I interviewed Rod Collins who discussed Plan and Control to Iterate and Co-create.
It’s great to speak with you again, Rod. I’m looking forward to hearing your views on the topic of plan and control to iterate and co-create—you were mentioning thriving companies. What do you see with thriving companies, and how do the upper levels of management do things differently? Can you start by providing a brief background of yourself?
Sure, good to be with you again, Dustin. I’m Rod Collins and I’m the director of innovation for Optimity Advisors and also the author of the recently published book Wiki Management: A Revolutionary New Model for a Rapidly Changing and Collaborative World. Our topic today is really at the heart of the transformation that’s happening in management, where the fundamental dynamics are shifting from a foundation of plan and control, which is the way it’s been for well over a century, to a new set of dynamics, which can best be termed as iterate and cocreate.
Can you start by providing a definition on what is plan and control compared with iterate and cocreate?
There’s a lot changing in the world today; let’s start with what’s not changing. What’s not changing are the two timeless accountabilities of senior business leaders: strategy and execution. If they do those things well, they keep their jobs and companies stay around. If they don’t do either one of those well, they could be in peril. What’s shifting is the foundation to each of those two timeless accountabilities. For the past hundred years, planning has been the fundamental basis of strategy. We even have the term strategic planning; that’s how much it’s been institutionalized.
The typical modus operandi was the senior leadership team would go off maybe on an off-site once a year, they’d do some deep thinking, and they’d work on three- to five-year plans and lay these out in great specificity; some of them were PowerPoints that went into the hundreds. Then, with that plan in hand, the foundation for execution in the old model was control. You got the plan with all the details, we know exactly where we’re going, how we’re going to get there, all those little things we’re going to do, and the control structures are in place to make sure there are no variances, no deviances, that we stick with the plan. That has worked pretty well for over a century.
That’s all shifting now, thanks to the digital age and the accelerating pace of change that it has driven and the requirement for companies to become innovative. Now, when you look at companies like, let’s say, for example, Google or an Amazon or a Wikipedia, look at LINUX; they’re a very successful, crowd-sourced operating system. The foundation for strategy in these enterprises is not planning at all; it’s iteration. And the foundation for execution is not about control; it’s about co-creation. This looks very, very different from the way we’ve done it before.
Let’s talk a little bit about how iterating and co-creating are different. The leaders of what I call vanguard companies understand in a fast-changing world, you don’t need maps;- and plans are now, I guess, the maps. You need a compass because when the landscape keeps shifting, a map is totally useless, but a compass gives you a general sense of direction.
It’s well-known, for example, that Google is working on driverless cars; this is a long-term project of theirs, but they certainly intend to revolutionize driving as we know it. They have a general sense of direction of what they want to be doing, but as they’ve been working on these driverless cars, they’re iterating as they go along. They’re finding what works, what doesn’t work, and they make adjustments. There’s no master plan that knows exactly what it’s going to look like when they get there. They’re kind of learning as they go along, and they think learning is an important part of the strategic process.
Rather than expect people to comply with an elaborate set of controls, companies like Google have their workers intimately involved in the creation or, as I say co-creation of what they’re building. There is this continual cadence of we iterate a little bit, find out what works, what doesn’t work, learn that together, then co-create the next phase. This is also the same rubric that operates in agile software development, which is very different from the traditional model known as waterfall. Waterfall is essentially a planning and control model, whereas in agile software development, they are constantly iterating and co-creating and not worried much about having long-term, elaborate plans. Planning is done with each different iteration as they work on.
Some people listening to this might say this sounds very chaotic, it sounds very haphazard, and would be a nervous wreck if they ever did anything like that, because how do things get done well and on time? Well, it turns out those who use iterate and co-create tend to deliver faster, tend to deliver higher quality than those who don’t because control in a fast-changing world is essentially an illusion. What the business leaders who practice iterate and co-create are very firm on is they tend to set some firm timelines in which they will work. If they’re working to deliver something by a particular date, they keep their eye on that as they’re going through the iterative and co-creative process.
To demonstrate how fast this can happen, somebody at Zappos came up with the idea a little while back: Wouldn’t it be wonderful if somebody’s sitting on a subway train and sees a pair of shoes on somebody else on the subway that they like? Obviously, they’re not going to tap a stranger on the shoulder, but what they can do is take a picture of the shoes. What if, after they take that picture, Zappos can send that style of shoe to them in their shoe size? That was an innovative idea. They got to work on that, and they went from concept to functionality in 12 weeks. Iterate and co-create, despite the fact it may not seem, on first blush, to move quickly, actually does because it is building continual learning into the process, and the faster you learn, the faster you can deliver.
The problem with planning and control is that it leaves no room for learning, it doesn’t like variances, and when things don’t work, you have to rework all of the plans again, and that takes time and drives a lot of delays.
Can you talk about, people have habits and mind-set which is still planning and control, how do you change that mind-set and those habits?
That is the $64 million question. That’s the crux of the management problem today. Most companies are being led by leaders who are very skilled in the planning-control dynamics of management and highly uncomfortable with the notion that we will have a general sense of direction, iterate and co-create together. They’re uncomfortable because their role essentially shifts.
It’s funny we’re having this conversation today because the thought occurred to me just this morning that the title of chief executive officer is probably becoming obsolete. The whole picture of chief executive officer is here’s somebody at the top of the pyramid and has purview of everything, and their job is to make sure that we execute according to plan. This is the mind-set that executives have. I think the new CEO going forward is the chief enabling officer, and that leader’s job, that version of CEO is, they’re making sure that the workers have all the tools that they need to learn and to deliver.
If I can quote Google, I just recently finished Eric Schmidt’s new book How Google Works. He said that their management formula is very simple: You hire good people and get the hell out of the way. The chief enabling officer gets the hell out of the way. Now, they are not laissez-faire because they are holding up we need to get from here to there by this date, and that is the focus. Instead of laying out everything for everybody, you let them figure it out. This requires business leaders to be highly trusting that their workers will figure a way to get it done. That has not been the case in the past, but these are the habits of what I would call the chief enabling officers, the new CEOs of tomorrow.
I think those who can make the transition, which I think may be psychologically challenging, I think will be greatly rewarded. Those who can’t make the transition are going to be handicapped because in this fast-changing business world in which we are today, only the fast and the adaptable survive, and iterate and co-create is much better at adapting than planning and control.
Do you have any final recommendations?
Yeah, I think that senior business leaders today need to read a lot of the literature that’s coming out. There’s a lot of good literature coming out in the space of innovation. I think business leaders need to understand what innovation is. I think they will discover it’s very different from what they think. Innovation is not a function, it’s not a department, it’s not something you can purchase like software. Innovation is fundamentally a different operating system that the heart of this operating system of these dynamics of iterate and cocreate. I would encourage business leaders to read some of the fine books that are coming out now in the innovation space.
Thanks again for sharing.
Thanks, Dustin, always a pleasure to spend some time with you.
Yep, I look forward to talking with you again soon.
"See Rod's New Book on Wiki Management for Growth in a Rapidly Changing World. http://www.optimityadvisors.com/WikiManagement/
About Rod Collins
Author, Speaker, and Innovation &
Organizational Design Expert