In my last post, I discussed the link between an organizations’ culture and overly aggressive customer commitments.
In this post I want to document the dysfunction that occurs internally within an organization which severely over commits to customers. What I am describing in this post is one of the major pathologies of the high tech industry today.
John (CEO) and Enrique (Chief of Sales) have just signed an 800 million dollar deal. Deployment of the (yet to be developed) product which has been sold will start in two years. John and Enrique are naturally far more happy than is VP R&D, Karl. Karl knows that while it may be possible to develop what has been sold, he does not have the time or resources to make it happen in the time frame which has been committed to.
Karl convenes his 12 development “leads” to conduct a three day summit to discuss “how to make the development miracle happen”. Karl dictates an impossible schedule. Moshe from Israel and Pieter from Holland speak up, questioning the soundness of the timetable which is “handed down”. Moshe tells Karl: “You cannot manage by “wishful non thinking”. Karl crushes Moshe, who is replaced and dismissed.
Subsequently each development-leads convene summits with their respective teams. The story about Moshe being axed is all over the company. The story in the trenches is that “John and Enrique are dead if we don’t deliver to schedule”. (The scheduled commitments are compared to committing to learn Chinese in a month).
The commitments are rolled down into the trenches and by the time it has reached the 600 developers, everyone know it is purely absurd. Sandbagging, dithering and belittling management as “out of their fucking minds” become common.
Furthermore, developers adapt the following behaviours:
1) They wait passively for a needed component from a peer to be late, and then blame one another for their own delays.
2) The troops ask for more and more “clarity” about what the client “really needs”; management asks people to “assume ownership”.
3) The troops ask for “planning sessions”; management demands hard work and a better attitude. Management asks for more efficiency and priority management; the troops ask for more time.
4) Several sets of parallel commitments co-exist…1) what was told to the customers, 2) what was told to management, 3) what “we tell ourselves”, 4) what we tell our peers, 5) what the troops tell senior management. None of these commitments is solid or real.
5) The entire system breaks down and spins into chaos very suddenly. This can happen at a initial benign customer review session which turns bad. Or, someone from development “leaks” what is going on to the customer, who demands a review and the shit hits fan.
There are many OD interventions which can mitigate this damage. Read on.