Competency vs Capability Mindset: The Organisation

Design your organisation for the potential of its people and their capabilities, not the limits of an expertise.

I recently noticed that Capability or Competency? Mindsets matter was the second most read post on this blog. Part of the appeal of that post is that it addresses a critical shift in mindset for those grappling with the new dynamics of the future of work. We stand facing an organisational version of the personal insight Marshall Goldsmith described succinctly as “What Got Me Here Won’t Get Me There”

Competency-led Organisations

The Core Competency concept introduced by Prahalad and Hamel refined a concept that had been strong in management for decades. It is undoubtedly true that organisations compete by being better, more competent, at something than their competitors. However the mindset of being more competent differs from a competency. This subtlety was often lost as core competency flowed into the mainstream of management thinking.

The focus on core competencies created a mindset that organisation gets to choose its competencies as part of a strategic planning process and should set targets for competencies to fulfil its strategy.  While Prahalad and Hamel spoke of the need for organisations to look forward to assess and build their competencies, much of the focus in organisations has been historical. The biggest outcome of the discussion of core competency has been a narrowing of organisational ambition and a focusing of activity on historical strengths. “That’s not our core competency” is more common than “We can leverage core competencies”.

Influenced by themes that go back to the beginning of scientific management, we have turned core competencies into rigid processes, standards and policies. We have judged these competencies by what sustained competitive advantage in past markets. We have spent less time on the changing customer perceptions of value and the ongoing dynamics of the future marketplace driven by new competitors. The list is long of disrupted organisations who felt safe because a new entrant lacked their core competencies. In many cases the infrastructure to reinforce and sustain these core competencies became a burden in their ability to adapt and survive. 

Capability-led Organisations

The Big Learning mindset that pervades the future of work highlights that competitive advantage in the next century is based on the ability to build the capabilities required to compete in an environment of uncertainty. Rather than specifying a fixed goal of competency, we seek to build an open capability to fulfil our strategic intent and our customers’ needs as they arise.

Adapting organisations to foster autonomy, learning and change is what enables people to build the practical capabilities necessary to learn, grow and execute. The process you inherit is less important than the customer insight you gain in working to meet your customer needs. Prahalad and Hamel reinforced that in Competing for the Future their update of the core competencies discussion. The discussion on the need for organisations to build open capabilities that can help manage and drive adaptation.  These capabilities include openness to their networks and environment, collaboration, ability to learn, share and drive change. Critical too is the development of purpose as the new focus for organisational activity and the inherent rationale for groups of people to come together in work to benefit others.

Design for Capabilities

Responsive Organisations need to design for a capability-led response to a uncertain future. They need to develop core Big Learning practices like working out loud, personal knowledge management, adaptive leadership and experimentation. They need to design their organisations to allow individuals and the collective to focus on the realisation of purpose.

This organisational design will leverage networks, transparency, autonomy, experimentation and the inherent motivation of employees in ways that we have not yet seen. Developing a new competency in holocracy, agile, lean product development, design thinking, big data or any other single practice is not enough. An organisation must build the capability to continuously adapt to customer needs in a changing market.

Ultimately, it will also focus organisations more strongly on realising the potential of people, customers and other stakeholders. We need to design our organisations to build the capabilities that realise human potential. That can only help make work more human.

The Future Belongs to the Curious #PSKEvents

Curiosity is a critical capability for the future of work. We have reached the end of stocks of expertise.

This morning I was lucky enough to be involved in a fishbowl conversation with Cheryle Walker, Andrew Gerkens, Renee Robson, Charles Jennings and an insightful audience. The final question of the engaging conversation about learning and performance was ‘What capabilities matter for learning and development professionals in the future?’ The question prompted a great discussion of the value of strategic, business, relationship and systems acumen as learning becomes more focused on performance improvement & more integral to work.

My contribution was that curiosity is an important capability. As the attention shifts to how organisations can manage big learning systems, those facilitating this change need to be curious well beyond traditional domains of expertise. When work is learning and learning is the work to quote Harold Jarche, there is a need for facilitators of this process to be looking at their system and looking beyond the organisation with an intense curiosity. The question is not ‘what do I or our team need to know?’ The question needs to be ‘what can we learn that helps us work better and be more effective?’

Traditional approaches to learning often have an implicit or explicit assumption that there is a fixed reservoir of knowledge to be known by employees. Global connectivity has shown us that the required knowledge is constantly expanding, being shared and being created as people experiment with the edge and step into new domains or engage with new systems.

Big learning processes are key to the future of responsive organisations. Performance will depend on how fast and how effectively we learn. To shape this we must remember, the future of work belongs to the curious.

Expertise in the Way

Clients often say something to me along the lines of ‘I don’t want to offend you, after all, you’re the expert, but I think we might need to change this recommendation’. I am not offended. I am relieved. I can’t possibly know everything about their problem and circumstances.

Their ideas and knowledge improve mine. I am learning. We are learning together. We can’t let expertise get in the way of mastery.

The advantage of Big Learning approaches in organisations is that they break down the barriers that form around expertise. When an expert says no, trying to move forward can be hard because of both the reactions of other less expert stakeholders and because the expert has now invested ego in blocking.

Shifting the focus to gaining new external perspectives, testing ideas in practice, learning more or experimentation can be a great way to validate all opinions but judge on results. The learning from the tests will move everyone forward. Momentum is your friend.

An expert who doesn’t want to pursue mastery used to be an expert. Never let expertise get in the way of learning more through work.

Execution is a Big Learning challenge

‘Vision without execution is just hallucination’ Thomas Edison

Vision & strategy is nothing without execution. Execution is often presented as a challenge of discipline. However the discipline at the heart of great execution is learning. Organisations need to use Big Learning systems to adaptive lay execute their strategy

Vision & Strategy are Hypotheses

The PowerPoint deck might land on the desk with a reassuring thud. The tables of data, the charts and the pictures explaining the vision and strategy are impressive. No matter how excited your strategy team is their plan is just still a guess.

Competitors don’t sit still. Customers are fickle. You underestimated the effort. You over estimated the upside. Reality is always different when you execute a strategy. Local leaders need to adapt the strategy to the reality they must tackle.

Organisations have tried to enforce stronger execution discipline to prevent this adaptation. They worry that the fragmentation of approach will cause issues. However a disciplined execution of a strategy that is not fit doesn’t add any value and can be disastrous. The learning opportunities for the organisation are lost.

Learning and adapting in coordinated ways throughout the organisation is the art of Big Learning. If your vision and strategy can’t adapt to reality, it is still a hallucination, no matter how widely it is shared. Organisations need to focus less on the discipline and more of the coordination of learning throughout the organisation. Finding effective adaptations and proofs of the strategy at work, changing to align and sharing them widely is what brings a vision to life.

Flip the question

John F Kennedy in a famous piece of rhetoric said ‘ask not what your country can do for you — ask what you can do for your country’. We can all benefit from the perspective of a flipped question.

As you congratulate yourself on your 3% conversion rate, do you wonder what went wrong with 97% of your efforts? As you hear about the engagement of employees are engaged, do you ask what engagement you have in their work and life? When you talk of driving employee motivation what if your not in the driver’s seat? When you measure your market share do you also consider your share of wallet? What happens if you flipped all the positive performance indicators in your business? And now the negative ones?

Taken too far like Kennedy’s quote flipping can become trite rhetoric. However there are moments when it can open a new insight, particularly in settled and traditional modes of business and thinking.

Organisations that are successful and dominant in their industries are inclined to accept the usual logic. Success is its own momentum and brings its own blinkers. Many times the attackers will come with new metrics or a flip of the traditional logic.

Ask not how this data confirms your thinking – ask how your thinking is challenged by the data. That’s where the Big Learning lies.

Learn from the Practice of Work with #wol

Working out loud is key practice to move beyond the theory of work. Working out loud helps solve the obstacles of work, tests ideas and creates interactions to keep work grounded in reality.

The most theoretical conversation in the modern workplace is often when a stakeholder says ‘I agree’. What they are actually saying is ‘I agree in principle to your approach given our common theoretical understanding of what you are doing, the absence of obvious obstacles and my limited understanding of the context’. Agreement like that falls apart when practice diverges from theory, obstacles occur or when more context surfaces.

The theory of work diverging from practice impacts more than stakeholder conversations. It is at the heart of breakdowns of many customer experiences, work processes and policies, incentive schemes, restructures, change initiatives and many other domains. In each case as the theory leaves the design table it meets obstacles, exceptions and other challenges in practice.

Some organisations try to eliminate these issues with a stricter adherence to theory. Instead, the defining practice of an effective modern organisation is how it accepts theory’s limitations and focuses on learning the lessons of real practice. Big learning practices take advantage of the organisations ability to learn through each employee’s work and adapt to break the boxes of the theory. Knowing obstacles are the work, organisations plan to learn and adapt. These organisations never get stuck in theory because it is always subject to improvement in a live test.

Working out loud plays a key role in these responsive organisations bridging the gaps between theory and practice. Working out loud puts ideas out for early tests, surfaces obstacles and shares context widely. A stakeholder who says I agree in a process of working out loud has a surer foundation and a better expectation of what is ahead.

Judge the success of your work in practice. Allow for learning and adaptation. Use working out loud to strengthen the culture of learning in your organisation.

Speaking to Senior Managers

Senior leadership engagement in change is a hot topic. Social collaboration makes the absence of leader engagement obvious. I’m often asked to speak on collaboration, learning and leadership to senior executives. As I used to be one, people want me to share a little of my passion for these topics. Here are some suggestions to guide you in your senior leadership engagement.

It’s not a priority

Collaboration, leadership and learning is unlikely to be a priority for your senior leaders. Sure they’ll discuss it but they don’t want to do it. They don’t know anyone who got made a CEO because his team was the most collaborative or the most agile. There is always a bigger business or customer problem that is on their mind.

Rather than engage in an argument as to why this mindset is wrong (it is – see Big Learning), I start with understanding the real business problems that they want to solve. Once we understand the business problems we can connect collaboration, learning and leadership as solutions to that problem.

Avoid Capitalised Nouns

Senior executives are busy and distracted. They don’t want jargon and hype. They are allergic to empty captalised nouns. The more you use words like Collaboration, Leadership, Engagement etc without making them tangible the less credible you are. The more it sounds like a futuristic vision or a quixotic quest the less relevant you are to their world.

Tell Stories

Stories make change tangible to busy & smart people. Ben Elias of remarked to me recently that it is hard for people to conceive of how their organisation could be highly collaborative. They have never seen it, so the ideas and practices don’t connect with their reality. Specific stories make that connection. Tell rich and engaging stories of how things can be and how to get there.

Ask for something specific

There’s nothing worse that taking the time of senior leaders, winning their support and not being able to define exactly what you want them to do. Always have a specific ask of them ready to go. Have two in case they say yes to the first. Better yet have a personal ask that is framed as something simple that they can agree to do to sustain change. The 3 simple habits of working out loud was designed as one such example.

When you are done, Stop. Leave.

Senior executive time is precious. Give it back to them. Tempting as it may be to bask in the glory of a good meeting and deepen rapport, you will win more credit by leaving when you have done your job. Remember when something is not a priority you are always on borrowed time.

The Hypotheses of #wol – #biglearning

Working out loud helps us to learn faster by making our hypotheses explicit.

Hypothesis is one of those words that makes something simple sound elegant & scientific. Many digital practices like experimentation and design thinking push people to work and test from explicit hypotheses. It sounds better than draft or work in progress. Using hypotheses and testing them quickly is a core practice of organisations that leverage big learning approaches.

Working out loud can help you to discover the speed, engagement and agility of explicitly testing ideas as hypotheses with your work colleagues. If you are reluctant to share a draft idea, ask for help to validate a hypothesis that shapes how your idea will advance.

Confirming the underpinnings of your work as you go both brings stakeholders on the journey and also enables you to get to the destination faster. Treat every share as an opportunity to confirm that you are on the right track. You will benefit by making small adaptations now rather than rework later. You will also be helping your organisation to practise big learning.

The Two Small Wicked Challenges of Organisations #BigLearning

If we focus on our organisations as places to work and learn together, two small but wicked challenges come to the fore. The design of a Big Learning system needs to help an organisation manage these challenges at scale.

Two Small Challenges

Knowing what we know: Lew Platt of HP originally coined ‘if only HP knew, what HP knows’ but the frustrations of shared knowledge have been around since the beginnings of management. We can’t achieve knowledge sharing (& shouldn’t try). However finding a more effective way is an ongoing process of evolution in any group.

Knowing what works: Since FW Taylor management has known its role is focused on isolating what works and what can be improved, but clearly this has been a challenge for as long as people gathered together in challenges. One need only look at the many thousand year history of military thinking so see an example of the evolution of approaches to effectiveness. Separating out what performs well and how to be more effective is an everyday challenge. This encompasses both what works in internal relationships and what works externally for customers, community and other partners.

The problems worth working on in life often have the characteristic that they are easy to describe but wickedly complex to solve. There are no simple transactional or universal solutions to these issues. They sum up the quest of the entire history of management and human organisation.

Many Solutions. An Evolving State

The wickedness of these two small problems is why we require a systemic response. Individual approaches can contribute to the sharing of knowledge or learning what works or both. However effectiveness and scale will require an interplay of many elements of a system and continued learning and enablement of evolution of that system. Organisations that do not focus on creating a Big Learning system that encourages its people to learn, to share and enables them to continuously improve their practices will be left behind.

Enable Employee Careers through Learning

There is no organisational strategy without the capability to execute it. The demands of a disruptive economy mean organisations need to create systemic approaches that scale learning through every role, Big Learning. However, organisations need to build employee capability in their interests and not just for the sake of the organisation.

Holding on to a Wooden Box

Imagine you asked a friend to hold a wooden box for you.  If they are a good friend, they might hold it for an hour or so. Some will give up and take it home to return it later.  A great friend might put it down and stay by for a little longer. Very few would bother with the box for more than that without some further instructions, some value to them or some better proof of the worth of the exercise. 

Yet organisations continue to ask employees to learn knowledge and skills for the sake of the organisation. Worse still, these approaches to learning are often rolled out with little communication as to the value of the learning for the organisation, let alone the employee. 

Consider mandatory role and compliance learning. To employees it is as mysterious as the box request and it is cannot be escaped. The signals sent remind employees that it is designed to protect the organisation as part of a compliance system, rather than helping the achievement of employee goals. 

The employee is left to complete the learning for the organisation and then forget it. There’s little surprise that much learning is wasted and is not applied to help organisations achieve strategic goals.

Enable Employee Careers & Purpose

Imagine you had a friend who shared that they wanted to develop a career as a public speaker. You might explain that practice & feedback is a critical part of developing as a public speaker and you could help them see that a wooden box would let them speak at a speaker’s corner whenever they want. There’s a far greater chance your friend is going to make an effort to carry their own box. 

Organisations can do more to make their key strategic learning a part of a process of creating greater career options for employees. Learning that advances employee goals first is more engaging, more effective and more likely to endure. Very few people will seek mastery in a skill that is imposed on them. Mastery requires purpose.

Working in this way begins with employees goals and enabling the employee learning journey through all their work. Learning in this approach means thinking beyond tasks & roles to lifetime needs and career lattices.  In addition to specific technical skills, learning must develop portable skills that increase the diversity of an employee’s career options. 

Designing first for the employee journey while still achieving the organisations strategic needs will improve the effectiveness of learning. Importantly it is a key part of creating an Big Learning environment where every employee contributes to the ability of the organisation to learn and improve