Gene Kim and Steve Spear, Discussing ‘Wiring the Winning Organization’

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My guests for Episode #493 of the Lean Blog Interviews Podcast are Gene Kim and Steve Spear, co-authors of the new book Wiring the Winning Organization: Liberating Our Collective Greatness through Slowification, Simplification, and Amplification.

Joining us for the first time is Gene Kim, a Wall Street Journal bestselling author and researcher who has been studying high-performing technology organizations since 1999 – He was the founder and CTO of Tripwire for 13 years. He is the author of six books, The Unicorn Project (2019), and co-author of the Shingo Publication Award-winning Accelerate (2018), The DevOps Handbook (2016), and The Phoenix Project (2013). Since 2014, he has been the founder and organizer of DevOps Enterprise Summit (now the Enterprise Technology Leadership Summit), studying the technology transformations of large, complex organizations. He lives in Portland, OR, with his wife and family.

Dr. Steven J. Spear, DBA, MS, MS is a senior lecturer at the MIT Sloan School of Management, a Senior Fellow at the Institute for Healthcare Improvement, and the author of influential publications like the book The High-Velocity Edge, and the HBR articles “Decoding the DNA of the Toyota Production System,” and “Fixing Healthcare from the Inside, Today.” 

An advisor to corporate and governmental leaders across a range of fields, he is also the founder of See to Solve, a business process software company. He has a doctorate from Harvard, master's degrees in mechanical engineering and management from MIT, and a bachelor's degree in economics from Princeton. 

Steve was previously a guest five times in episodes 58, 87, 262, 358, and 386.

Questions, Notes, and Highlights:

  • Gene — what's your “Lean” origin story or however you would frame or label it?
  • Steve — what's a key highlight of your Lean origin story?
  • “The ultimate learning machine” – Toyota
  • Backstory on working together on this book?
  • How many copied 2 pizza teams from Amazon and failed??
  • What puts some companies in the “danger zone” and how is that detected if it's not obvious?
  • The andon cord was a way to speak up
  • Steve – see, solve, share? A 4th step? See, safe to speak, solve, share?
  • You write about recurring problems in a workplace. How do you think the behavior of managers punishing people for problems gets in the way of solving problems?

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Episode Summary

Wiring the Winning Organization: Unlocking Excellence Through Structure and Culture

In the quest for organizational success, there's been a perennial search for the elements that create an exceptional company. It's not just about the products you sell or the services you provide; it's fundamentally about the way your company operates. Leadership scholars and practitioners Gene Kim and Steve Spear explore this intricate dynamic in their new book, “Wiring the Winning Organization,” shining a spotlight on how specific organizational disciplines can unleash greatness.

The Cornerstone of Company Success: It's Not Just About the Work, It's About the Wiring

The basis of any successful organization isn't merely the individual excellence of its members but the symphony-like coordination of their talents into something greater than the sum of its parts. The most groundbreaking organizations treat talent like electricity–ensuring it flows smoothly, without impedance, throughout the system. The wiring, a term that Kim and Spear use extensively, refers to the processes, procedures, and routines harmonizing individual efforts towards collective goals.

Leadership styles in such organizations go beyond just being present; they involve being empathetic and proactive. Senior leaders frequently visit operational sites to understand the conditions their teams work in, exhibiting genuine interest and offering assistance to empower their teams to excel. This isn't solely a matter of control–it's about creating an environment where problems can be safely and proactively addressed.

Creating Conditions for Growth: The Framework of Slowing Down, Simplification, and Amplification

Kim and Spear emphasize “slowification”, simplification, and amplification as core mechanisms transformative organizations leverage.

  • Slowification suggests that taking the time to properly plan and prepare can enable efficiency and excellence. Inspirational examples include the US Navy's Top Gun program, which emphasizes rigorous training to create an environment for pilots to thrive under pressure. This approach, akin to Daniel Kahneman's “slow thinking,” endorses a reflective reaction over a reflexive one.
  • Simplification means altering the problems themselves so they become more solvable. Techniques like incremental solving, sequentializing, linearizing, and modularizing enable independence and reduce the chance of complex, coupled problems. Organizations that adopt a philosophy of simplification often lead to a culture where innovation becomes an everyday occurrence rather than an infrequent breakthrough.
  • Amplification is the ability to escalate even the faintest indicators of issues so that they become impossible to ignore and require immediate resolution. This concept is tightly linked with creating a culture of safety–psychological safety, where workers feel encouraged to flag concerns without fear of retribution.

Nurturing Psychological Safety and Encouraging Proactivity

Creating the right culture is as important as implementing the correct systems. Psychological safety–a concept Google's Project Aristotle and the State of DevOps support report as predictive of high-performance teams–stands pivotal in ensuring teams can freely express concerns and ideas. For this reason, leaders must adopt a mindset of systems thinking, which allows them to see how the organization's structure can either facilitate success or foster failure. It's the responsibility of those in charge to ensure the environment is primed for their teams to deliver value effectively and efficiently.

The Power of Independence and Collaboration in Innovation

Building on the architecture of processes and teams, the notion of “independence in action” plays a dual role. It applies not only to sequential processes where small batches and single piece flow prevail but also to parallel systems that empower teams–like the two-pizza teams at Amazon–to innovate without being bogged down by unnecessary coordination. Organizations that understand and put into practice these principles of independence paradoxically become more interconnected and robust.

Conclusion: Beyond Copying Best Practices to Understanding Principles

Spear and Kim caution against adopting initiatives akin to “cargo cult practices” in which organizations superficially imitate elements of successful firms without understanding the underlying principles. They push for a deeper appreciation of why certain practices work and encourage leaders to focus on building processes that organically prompt collective greatness. The art of “wiring the winning organization” is an interplay of structure, culture, and innovation–a blend that only works when underpinned by a deep understanding of personnel dynamics within any given company.

In embracing the triad of slowification, simplification, and amplification, businesses are not just optimizing performance but also crafting an environment where progress is the natural outcome. The work of Kim and Spear provides a compelling roadmap for leaders to turbocharge their organizations, liberating the collective intellectual prowess of their workforce, much like the electric circuitry that so smoothly harmonizes the power within a system.


Automated Transcript (Not Guaranteed to be Defect Free)

Mark Graban: Welcome to episode 493 of the podcast. It's November 29, 2023. My guests today are Gene Kim and Steve Spear. We're going to be talking about their new book, Wiring the Winning Organization. So you can learn more.

Mark Graban: You can find links to their book and their websites and more. Look in the show notes or go to leanblog.org audio Four nine three. There's so much we could to talk about related to the book and their expertise and applications of the ideas in their book. I think at the end we all feel like we just barely scratched the surface. We'd like to invite you, the listener, to submit questions.

Mark Graban: I think Gene, Steve and I are looking to do a follow up episode in early 2024. You can email me. Mark@markgraban.org if you have questions for that discussion based on the episode, get their book and see what questions you have. Always good to talk to them and look forward to doing it again. So again, mark@markgraban.org you can send me any feedback or ideas you have about the podcast there.

Mark Graban: And again, the episode page is leanblog.org/493.

Mark Graban: Welcome back to Lean Blog interviews. I'm Mark Graban. Very excited we're joined today. We have two guests here together, Gene Kim and Steve Spear, co authors of the new book Wiring the winning organization, liberating our collective greatness through slowification, simplification and amplification. And I got all through that in the first.

Mark Graban: So congratulations on the book. Before I tell you a little bit more about Gene and Steven Spear, welcome to the podcast. It's great to have you here.

Steven Spear: So great to be here.

Gene Kim: Yeah, Mark, it's good to be here.

Mark Graban: Yeah, I thought it was going to be like three tries. I was going to have to get through the title Wiring the winning organization. Joining us here for the first time, Gene Kim. He's a Wall Street Journal bestselling author researcher. He's been studying high performing tech companies since 1999.

Mark Graban: He was founder and CTO of Tripwire for 13 years. He's the author of six books, including the Unicorn Project, co author of the Shingo publication, award winning accelerate, and others. He has been the founder and organizer of DevOps Enterprise Summit, which Gene I saw an email earlier and I didn't update the intro. This event has no tell us about the new name for the event, the.

Steven Spear: Enterprise Technology Leadership Summit. And I think the observation is that kind of the aperture of the conference has kind of moved on between just Dev versus ops, the stuff in between Dev and QA, and also stuff afterwards operations and stuff before business and so forth. So really it's been conferences about experience reports of technology leaders transforming their organizations, often with their business counterparts. So it was time we got to make so many comments over the years saying, this is not the way I talk about the conference to other people. It's really about a leadership conference.

Steven Spear: So anyway, that was a long time coming and finally made the change. Yeah.

Mark Graban: Okay, we'll put a link to that in the show notes and hope people check that out. Gene's joining us from Oregon, and we're also joined, coming to us from Massachusetts, Steve Spear. Steve, this is your 6th time, I believe, on the podcast.

Gene Kim: You're the guy who returns my calls. Mark, what can I do?

Mark Graban: You return mine. And more than 100 episodes ago, we look at the gap between episodes. That's on me. That's my fault, but I'll put links to the previous episodes. Always great to talk to Steve.

Mark Graban: He is a senior lecturer at the MIT Sloan School of Management. He's a senior fellow at IHI, the Institute for Healthcare Improvement. He's the author of very influential publications like the book the High Velocity Edge HBR articles including Decoding the DNA of the Toyota production System and Fixing Healthcare from the Inside, Comma. Today, he is also founder of C to solve a business process software company. He has a doctorate from Harvard, master's degrees in mechanical engineering and management from MIT, and a bachelor's degree in economics from Princeton.

Mark Graban: So, Steve, unlike Saturday Night Live, I don't send a special jacket to the five time club members. We'll figure out something to help signify that other than a hearty thank you and welcome back.

Gene Kim: Mark. I'm highly motivated by a trivial swag, so if you come up with a jacket, T shirt, even a scarf, I'm good.

Steven Spear: Actually, Mark and I were brainstorming about the 150 pound trophy that's actually heading your way.

Gene Kim: And you know what? Nothing spouses and families love more than having that 150 pound trophy put central, like in the living room or the kitchen. Anyway, it can be waiting for it.

Mark Graban: It can be blurred behind you in the background. Every Zoom meeting and podcast you have, it'll be hard to miss. Before we talk about the book, Gene, I want to throw this at you first. I've sort of come to ask people as an introductory question, tell us your origin story, whether that was, I don't know, lean or agile or however you frame it, but to this whole world of kind of interconnected methodologies, how and where and when and why did you get started?

Steven Spear: Yeah, for sure. In fact, for those of you who don't know, Mark and I have a lot of friends in common in the technology community. And so my journey started back around 1999 with this observation that there were certain organizations that simultaneously had the best project due date, performance and development, the best operations, reliability and stability. They had the best posture, security and compliance. And so the natural question is, what are they doing differently that results in those amazing outcomes?

Steven Spear: And in that journey, I remember reading the 1999 article, decoding the DNA of the Toyota production system, and just was dazzled by the clarity of it. And this journey has taken me through sort of itils through the kind of an operations framework, led me to the DevOps community. And what I found so exciting was meeting Steve at an executive education course at MIT in 2014. And that was just changed my worldview. And it made me realize there was so much that I didn't see.

Steven Spear: And hopefully we integrated some of that into the DevOps Handbook. But it's been so rewarding working with Steve over the past three plus years, really trying to answer this question of what is in common between DevOps Agile, the Toyota production system, lean safety culture, and so much more. And I think a phrase that Steve uttered that just forever I'll carry around is they're all incomplete, of a far greater whole. And so that's really what we tried to put into winning. The winning.

Mark Graban: And real quick, for all the different terms there, not everybody listening has that software or tech background, and I don't even know. So I'm going to ask you just myself, what is DevOps?

Steven Spear: In a nutshell, yeah. In fact, I would say the kind of pre wiring the winning organization, I would say it is a set of architectural practices, technical practices, and cultural norms that allow organizations to do tens or hundreds of, or maybe even hundreds of thousand deployments per day, like at Amazon, while preserving world class reliability and stability. And I think the way they do that, which is in a world where most organizations ten years ago were doing maybe one release a year, and it was often resulting in terrible outcomes, think healthcare Gov. That was just unthinkable, irresponsible, maybe even immoral. And yet, if you take a look at the techniques they were using, I think that you would recognize so much of it in the Toyota production system.

Steven Spear: The small batch sizes, single piece flow, linearized processes as you go from development to QA to operations and information security baked in at every step. How am I doing? Mark and Steve?

Gene Kim: Right on.

Mark Graban: That sounds good to know. Like I said, I don't know to grade your answer, but thank you for. We might be able to dive back into that as we talk about different concepts from the book, if that helps illustrate things. Steve, since you haven't, I think, been on here since episode 386, I don't know if I was asking the origin story question. I feel like I've somewhere heard you talk about this, but let me ask a question about your TPS origin story.

Mark Graban: So how does Steve Spear GO from bachelor's degree in economics to engineering and study? Like, what tipped you in that direction?

Gene Kim: Yeah, no, thank you. I appreciate the question. So I'm of the generation, which is sort of post Cold War, that I got out of college. In the intense rivalry of the even early 70s between the US and the Soviets and their respective domains, it was clear there was a winner and a loser in that. But there was an opportunity for relaxation, because while there was no longer this sort of military political threat, there was this industrial threat.

Gene Kim: Japanese companies were on the rise and posing real existential threat to American manufacturers, some of which faced their demise. US steel, Bethlehem Steel, RCA, I mean, General Motors still struggles around, but not nearly at the pinnacle of what they. So, you know, you and I are of that generation where we were like, what the hell is going on in Japan? Which is so fabulous in terms of their ability to generate and deliver value into society, which is wildly appreciated, whereas others can't. And we were fortunate that we were not the first wave of that question, because the first wave of that question had a sort of a Cold War answer, because the Cold War was sort of a nation state contest.

Gene Kim: And so the first wave of answer to that question in the early 80s was, there must be something nation state in nature. It's Japanese versus American culture, which wasn't actually the case, or something about the great wisdom of the Japanese governmental bureaucracy, which was not the case. Theirs is equally poor. Fortunately, we arrived with the second wave, where the studies were no longer at the nation state level, but at the corporation, the enterprise level. And what was becoming more and more obvious was that the huge distinction wasn't Japan versus the United States, because there were perfectly crummy organizations within Japan and some great ones in the US.

Gene Kim: It was at the level of the factory or the studio, whatever the organizing, generating, productive unit. You know, we had the good fortune of being an MIT when folks like Lester Thoreau were around, kind of encouraging us to think this way. The leaders for manufacturing program was being gestated across the business school and the management school. And I got caught up in that wave of what is going on there. And I had the good fortune, I mean, really just the blessing that Kent Bowen, who is a professor at MIT and material science, we started a conversation, started a relationship, and he took me on as a doctoral student.

Gene Kim: And there it was, the mid 90s, where I end up as a student of Kent's. And we're ten years into lean manufacturing. And Toyota is arguably one of the most studied organizations ever, and there's no second Toyota. And by good fortune, I had this chance to do a karate kid immersion inside a Toyota organization to learn firsthand what it was they did. And this was the huge freaking epiphany.

Gene Kim: And I'm going to connect it right back to what Gene was working on at the time, is I went in like a lot of people, thinking, oh, man, they must have some production control algorithm or something like that. It was in the math, it was in the robots. And what I came to appreciate, unfortunately, not as quickly as I wish I had, but what I finally came to appreciate, that they created the ultimate learning machine that they had established themselves and the way they organized the work of many, many people in a way that people were seeing and solving problems with a rapidity, a breadth, a depth, which no one else could match. Now, what I want to carry this over to Gene's work is we hit the Sloan school right around the time that MIT was the host for the International Motive Vehicle Program, which generated the research to show these enormous disparities between the quality, productivity, agility, et cetera, et cetera, that a handful of Toyota factories could achieve versus everyone else. And that was that program that coined the term originally lean production, that became lean manufacturing.

Gene Kim: Right? Gene was doing on his own the sAme, trying to understand disparities. And if you look at the International Motor Vehicle program was a study of 186 plants, and da da da da. And Gene was on his own doing the same thing across the projects of his type, where first he documented the enormous disparity between what was not good and best and worst, but typical and outstanding. And then he started to dig around and dig around and dig around to try and figure out what explained this enormous gap between the very best and everyone else.

Gene Kim: And I think he was arriving at the same conclusion. It was the learning dynamic that separated the best from the. So at some point, Gene and I have a common acquaintance of a guy who's just a phenomenally good connector, this guy, Tim Taylor. I'm saying his name because everyone on your show probably knows him, because everyone's removed by, like, two degrees of separation. He knows everybody or knows someone who does?

Gene Kim: But he made the introduction, said, you guys should start talking. That was 2014 or so, and we've been talking since. And a couple of years ago, whether it was someone in his family or mine, said, would you stop talking and start writing? And so we did.

Mark Graban: Well, so that leads into what I wanted to ask you best. Next. We heard some of the origin. Know Gene had been reading your work, Steve, and then you met and tell us more than I was going to ask about how your paths became intertwined here to work on a book together, because that's a big commitment there, work wise.

Gene Kim: Yes. I'll just do a short version on this and then kick it over to Gene. But, Mark, like you, my roots are in factories, and I'm very comfortable in places where before you go in, they say, do you have your eye protection and your steel tip shoes? As far as technology, I use apple products because they require no skill at all. I turn them on and everything happens.

Gene Kim: And Gene was coming out of an environment which I understood not at all. That's actually not an exaggeration. Yeah, not at all. And yet, when I listened to him talk and he got past a description of the technology being used, and he started talking about the organizing principles, that's a little foreshadowing of our gene, right? When he started talking about the organizing and the management principles, it was like, holy crap, he's talking exactly the same ideas that I was picking up.

Gene Kim: Not picking up, but being immersed in, at Toyota and immersed in. In great places like Alcoa. And that just fueled the conversation, because we're talking exactly the same language about what I thought were two completely different things. But over to gene.

Steven Spear: Yeah. In fact, I mean, I'll just characterize the working relationship with Steve as the most intellectually challenging but rewarding relationship I've had ever. And just to maybe get concrete, here are some of the kind of epiphanies that have come up over the last couple of years. I think so much has been written about the independence of action that's created within the Toyota production system. The notion that somehow we're able to lower the cost of change, to be able to do so much experiments and be able to be so resilient during production.

Steven Spear: And so that is actually something that you see in great engineering organizations, where they're able to do so much more with such a dramatically lower cost of change. So we could certainly derive some of the similarities there. But another sort of Kia ha moment is that there's another independence of action that happens on a total orthogonal axis. So we're talking about independence of action within sequential processes. There's actually a whole other category where we can create independence of actions for parallel processes.

Steven Spear: And so that's so much based on the work of Dr. Carlos Baldwin and Dr. Kim Clark around their study of the System 360 project at IBM. So that's a modest $5 billion project. That's $20 billion US in current dollars.

Steven Spear: That created the basis of dominance in the computer industry. It turns out that's exactly what we saw happen in Amazon in the had 2000 engineers. They were able to do maybe hundreds of deployments per day in the early days of their ecommerce property. But that sort of ground to a halt as they kept on adding product categories to the point where they're only doing tens of deployments, software deployments per year. And so that's what led to the famous creation of two pizza teams, the Jeff Bezos memo saying, we want teams no larger than can be fed by two pizzas, able to work independently of each other with no communication coordination, as opposed to spending all their time communicating, coordinating.

Steven Spear: And so in the same way that independence of action creates this dazzling amount of ability to innovate and to adapt, we can do that similarly in parallel systems like in software. Steve, how am I doing?

Gene Kim: It's fantastic. And Mark, if you'll indulge me here, I want to pick up on something Gene was saying, is that the opportunity to embed inside Toyota was a once in a lifetime experience for me. And what I came to appreciate was they were designing systems. And you and I know this going through business school, right, that the influence is, oh, you're supposed to think about the efficiency of the flows of materials through machines. And what I came to appreciate in this immersion is that they were designing the material and the machines and their flows around the human mind.

Gene Kim: Is there clarity of purpose, is there clarity of approach? And is there clarity of error so that the system can be rapidly self correcting? And it was such a mind boggling thing to realize that this is what was going on. It was designing around the human mind and the potential of the human mind to be creative and have ingenuity and recognize problems that hadn't been recognized and generate solutions that previously didn't exist. And now I'm going to tie this back to Gene's comment about the Amazon Two pizza thing.

Gene Kim: So it's rare that you encounter an organization which says, what we're going to do is gain our competitive advantage by creating conditions in which people's brains can be put to the best possible use. So ToyoTA, and in fact, if you go back through Taiichiono's seminal book from 1988 in English, 1978 in Japanese, and you read it with an eye towards what he's really saying, he's not talking about manufacturing processes, he's talking about manufacturing conditions that allow people to make intellectual and creative contributions. So that carried over to Toyota. I had a 20 year relationship with Paul O'Neill, who was a CEO at Alcoa and went through just some phenomenal transformation there. And I had the advantage of being mentored and tutored by Paul O'Neill.

Gene Kim: And one of the things he said, look, it was simple, which is if you think about the complexity of the process and the sprawl of the organization, he said, no, my competitors, when someone showed up every day, they said to the body, put your lunchbox, your coat and your brain in the locker and bring your brawn out onto the shop floor. And Paul O'Neill said, all I had to do was say to the bodies, thank you for bringing 30,000 brains into my enterprise, because now I outnumber the bad guy, right, the competitors. And you take that a step further. And this is back to the two pizza thing. Now, Amazon, I think the bulk of its profits come from its cloud services.

Gene Kim: And as Gene was talking about, the cloud services emerged not because someone deliberately designed cloud services. They're trying to solve for the problem of the complexity of their business process software. And there was a redesign. But here's the sequence is that some might think it's like, oh, we're going to design this business process software and then allow us to create two pizza know, small coherent teams. But the way I understand it from Gene is first they set the rule that the thing we're going to design, we're going to design the thing so that we can work on it two pizza teams at a time.

Gene Kim: And once they set that criteria, then came up with this whole idea of modularity and APIs and this thing and that thing. And it was really quite remarkable is, if you follow that chronology, that they realized that their exit velocity out of the problem situation they were in was around liberating human intellectual know, allow the ingenuity to be focused in a highly productive way. And then they landed on the modularity. And again, like I said, that's a very rare thing. Toyota, Amazon, Alcoa, I don't know, that's three out of naval reactors, for know.

Gene Kim: Admiral Rickover, I talk about that in my first book. He also designed processes to allow people to be creative. But in Manmark. It's rare, and they don't teach it in business school, unfortunately.

Mark Graban: The title of the book, again, wiring the winning organization. That wiring seems to include systems, high level design decisions, that this is not the top down genius at the top, making every decision for everybody. The subtitle talks about, you use the word liberating, Steve. Liberating our collective greatness. And then I think we'll have time to get to the how.

Mark Graban: It's a rich title and subtitle. We could talk for an hour just unpacking the title, but I wanted to ask one follow up question, though, about wiring. And I know this has happened. A lot of people studying whether it was Toyota or some health system that people thought was maybe going to be the Toyota healthcare. Gene, there's a chance to ask you if this happens with other tech companies, but people get enamored with one piece and like, oh, that's the magic beans.

Mark Graban: So my question is, how many people copied two pizza teams and failed spectacularly because they didn't understand the rest of the wiring?

Gene Kim: Yeah, how about, this is a sequence, Gene, you can answer Mark's very particular question about how many failed. I'll just take a guess at most. Because so many people try to copy Toyota, and there's no imitators, no good imitators. And then what I was thinking is, I explained the concept of the wiring and you explained the concepts of danger and winning ticket all.

Steven Spear: I'll just riff off of you, maybe. Let's set the stage for the foundational concepts in the book that I think that we find so rewarding.

Gene Kim: I'll take a stab, Mark, that those who copied the two pizza teams actually went out and bought a lot of pizza and didn't understand why the hell they were buying pizza. And if you were the dude who owned the pizza store down the block, you had like six months of just, like, profits you couldn't imagine. Then you wonder what the hell happened to the pizza? And that's because they said, oh, no, it's not pizza, it's falafel or whatever. Anyway, the concept of wiring, I'll tell you where it comes from, is that in the book, we talk about a big focus.

Gene Kim: The book is focused around the individual and their ability to be creative in a productive, contributory fashion. And we say most organizations think about where people focus their ingenuity. And we say there are three layers. The first layer is the object in front of them. And look, trained as an engineer, if you're a mechanical engineer, you learn to think about the design, the structure of a gear.

Gene Kim: If you're a geneticist, you think about the design and structure of DNA, whatever it is, you think about the object in front of you. And I guess the it people, which Gina is representing, they think about code or something or whatever they do on their little keyboards all day. And then there's a second level where you have to focus not on the object, but the instrumentation through which you act on that object, right? So for mechanical engineer, it might be a lathe or some other kind of machinery. For a geneticist, it might be the CRISPR technology, but it's the instrumentation through which you act on that thing.

Gene Kim: But then there's a third layer, and that's the argument we make. And this is where folks like Toyota really sweat it. It's the processes that allow the individual connect to the larger whole in a way that the individual efforts actually harmonize together smoothly towards some collective creative action, towards common purpose. And the reason we use the term circuitry to describe processes, procedures, routines, the things that join us together, it's not metaphorical. So you start thinking about what a technical circuit does, a technical versus social circuit.

Gene Kim: A technical circuit takes something which is in high concentration in one location and allows it to flow, ideally, smoothly, efficiently, without impedance, viscosity, whatever allows it to flow where it's actually needed. So an electrical circuit takes charge from here to here. Plumbing takes pressurized gases and fluids and whatnot, allows them to go from here to here. Sometimes because they're needed here, sometimes they have to meet in the middle and to react, whatever else it is. You start thinking about an enterprise, we form up enterprises.

Gene Kim: Why? Because there are big, huge, hairy problems that we can't solve individually. We have to put a lot of minds on it. And why do we have processes then, is allow the thing that you know to flow to me, because I actually need that information, or the thing gene knows and the thing, you know, to come together and have a very positive reaction. And so we were really deliberate and non metaphorical in saying there's all these processes which are meant to join people into this collaborative, creative, joint effort.

Gene Kim: And if they're well designed, the brain power of the people who are in the circuit can harmonize and synthesize in a beautiful fashion. But if that circuitry is ill designed, then so much ingenuity and effort is just squandered just trying to figure out where do I fit in, what do I do? Who do I depend on, who depends on me, what do they. That's the ultimate finite resource. Right.

Gene Kim: Sorry for the digression. I once did this thing with a group. It turns out that, let's say the average person burns 2000 calories a day. I'm doing the math off the top of my head, and some huge portion of that is consumed by the brain. I think it's like 1000 calories of the 2000 calories.

Gene Kim: It's just your brain just functioning. It sounds like a lot until you figure out how a slice of bread is 100 calories. All right, so then basically you start thinking about your strictly limited resource. I'm sorry, I forgot this example because I'd have a nice little pantomime here. But pretend this is a slice of toast.

Gene Kim: That's your resources for an hour of brain power. And so the question is, how are you going to invest that slice of toast? And in most organizations it's like, and this would be more scrap of paper anyway. Just imagine I'm throwing little crumbs away. You tear this off, it's like, oh, what am I supposed to do?

Gene Kim: Oh, you tear this off. Who am I supposed to work with? Oh, you tear this off. What resources do I need? You tear this off.

Gene Kim: Where do I get those resources? Oh, you tear this off. Oh, how do I clean up this area to actually do my work? And then when you do all that tearing off, because you've burned your brain power just figuring out what to do, what you're left with is like this tiny little scrap. That's your brain budget for the hour, is that now on the other hand, you've got that circuitry wired right, you got this.

Gene Kim: And if you've got this as your brain budget versus this little thing, you're going to win every day. And so anyway, can you tell us.

Steven Spear: A little bit about the danger zone versus winning zone?

Gene Kim: Yeah. So what we say is the folks who give this is the nutritional budget for the brains in their organization to actually do useful stuff. The reason there's so little energy left to solve hard problems is because they put themselves in what we call the danger zone. And the danger zone is characterized, again, the reason we form up in the first place is that we're trying to solve problems together. We can't solve individually.

Gene Kim: So you ask the question, well, what makes it hard to solve a problem? Well, give me a really hard problem when we've got a lot of factors and a lot of intertwining of forces and this and that, and when I look at that thing, I can't even characterize the thing and forget about making any guess about pulling what lever causes what outcome. Think about in Mary Poppins with that whole contraption of the horns and the toots and the drums and this thing and that thing like that. So that's one. What else?

Gene Kim: Well, if you're going to ask me to solve a problem, give me very little time. So I got no time to really think it through. I just have to go, whatever muscle memory, habit, routine, bias, apply that onto the problem, because I can't. No time to be creative, erase the stakes of the situation. So my heart is pounding.

Gene Kim: I know if I get the wrong answer, poof, don't give me any control over the situation. So I don't even have access to the levers. I just have to watch a thing and guess. And then don't give me any iteration, because we all know learning is an iterative process where hopefully we converge on an answer or a skill. So that's the danger zone.

Gene Kim: And we say, well, what's characteristic of the winners? And this is kind of the beauty of synthesizing gene's experience and perspectives with my own, because I have no flipping idea what they do in DevOps like you. It's like, what is this DevOps thing? I was like, what's a computer? I still use mechanical pencils.

Gene Kim: But what we both found is that the winners in whatever sector we encountered is that they move conditions from the danger zone to what we call the winning zone. And the winning zone is the danger zone, but just the opposite. Yes, people, to solve a problem and you say, hey, there's this big, huge, hairy problem, but we're going to give you the piece that you can actually see and understand and characterize. It's tractable. We're going to give you some time so that rather in this sort of fast, impulsive, reactive thinking, you can actually be in a deliberative, reflective, self critical, slow thinking state.

Gene Kim: We're going to create conditions that no matter what you try, it's safer than not. We've reduced the risk, we've reduced the hazard. We've given you some control. So actually not only are there fewer levers, but you actually can grab them or dials and you can turn them. And the last thing is we're going to give you several shots on goal so that you have this chance to learn iteratively.

Gene Kim: So the danger zone is a horrible place to be if you have to generate new useful information. And the winning zone is where you really want to inhabit. And then linking that to the circuitry is that organizations that are wired to win, they create the processes the procedures, the routines, et cetera, by which people are regularly moved out of that danger zone into that winning zone where they can engage their brains most productively.

Steven Spear: Mark, can I riff off of that and maybe answer your question in terms of like, I think one of the things I'm really proud of in the book that we wrote is that I think we make it very difficult to just cargo cult. We don't just copy the vocabulary, we don't just copy the tools and really work from first principles. And essentially, we assert that whenever you see an organization go from worst to first, there's only three mechanisms at work. The first is to slowify. So whenever we see people doing brilliant work in high consequential environments where you can't undo that, have terrible things go wrong if we screw up.

Steven Spear: When you see them perform brilliantly, they have to have invested time in planning and practice. And so there's 26 case studies in the book, and we have these examples, not from just technology, but from the medical community, from engineering. And I think a great example is the US Navy Top gun program. Right. During the Vietnam War, US Navy pilots suffered unexpected losses.

Steven Spear: And as Steve wrote, one of the findings of the Alt report was that pilots were having to do on the job training. So what was the answer? High intensity training under very realistic conditions so that they had all the muscle memory needed when they were actually in combat. And so we were able to tap the work of Daniel Kahneman, Amos Daversky, and show that in organizations, something very similar is happening. We want to build the routine so that we can perform brilliantly when it matters the most.

Steven Spear: And that means we have to slow. Just a little trivia fact. One of the things that we kind of grappled with is that slowify is a made up word, but there's no one English word that actually says you have to slow down to speed up. There's a lot of adages that insinuate it, but we felt like it was very important that we described. This is a short term investment for long term gain.

Mark Graban: There is that expression go slow to go mean. We heard that attributed to Toyota people. Toyota people say it. Is that the right way to say it?

Steven Spear: Yeah. Slow is smooth, smooth is fast. You got to stop sawing to sharpen the saw. I think there's all these adages that allude to it, but no exact word. Steve.

Gene Kim: Yeah, and Gene, if I could just butt in a little bit, is. Mark, we actually did find a term, and I think it's called bullet time, and it's that experience that you see of Neo in the matrix, where he's got such an intense perception of the environment that everything seems to be moving slow to him. One of your three main mechanisms, bullet time is really a lousy word, right? And it turns out that Kahneman and Torsky, with this whole notion of thinking fast and slow, and this idea that fast thinking has a time and place, but at other times it'll compromise your performance. So to use the term that builds off their idea of thinking fast and slow, slowification was, I think, a very accurate representation of our indebtedness to their research.

Mark Graban: So I wanted to ask about, well.

Steven Spear: Can I finish that just like this? One of the three. Can I give the other two names just so that we can. So slow Fi is like one dimension. The second dimension is how do we make sure that the problems are actually easier to solve?

Steven Spear: So take those wildly complex problems that are highly coupled, right? So some of the work of the nuclear reactor safety guy, I have this book on my shelf, Charles Perot. Perot. Dr. Charles Perot.

Gene Kim: Right.

Steven Spear: We don't want highly coupled problems, right. Because, I mean, small little failures cause global, catastrophic failures. And so this is really three ways that we can chop up problems. We can make them instead of large batch problems, we solve them incrementally. We can sequentialize and linearize problems like the Toyota production system or like the Amazon example.

Steven Spear: We modularize it. And all of them have this incredible benefit of enabling independence of action. We contain issues so that it can't cause global Castro failure. They lower the cost of change, enable innovation, all these dazzling things that people have marveled at, Toyota. And then the third one is around amplification.

Steven Spear: We got to be able to amplify even weak signals of failure so they can be acted on decisively to better prevent or detect or. Correct. And this should summon images of Paul O'Neill, the Alcoa safety culture and so forth. Anyway, so those are, I think our goal is really to go from first principles of how you create greatness and not fall into the trap of cargo culting, say, certain tools in the lean Toolkit. Or to answer your question, in the DevOps space, we very much do the same thing.

Steven Spear: Right? There's a Spotify model of how we organize. There's around automated testing that we see the tech giants do. So the two pizza teams. So hopefully this will give leaders a very firm foundation to reason why organizations do the things that they do.

Mark Graban: Yeah, I wanted to ask about amplification. Before I do that, though, I can't pass up this is a time of day where I feel like all I can contribute is pointing out the fact that you talked about Top Gun program, and you're also talking about Danger Zone. And I've been singing Kenny Loggins, or I've been hearing him sing in my head for about ten minutes. We don't have the rights to use that music, so we will keep that out of the real background of the episode. But you think about the wiring, and that seems to include culture.

Mark Graban: And one thing you write about in the book is the factors that help amplification include leaders encouraging people to speak up, comma, psychological safety. So I wanted to explore that, because, Steve, I think of you, and I think of see, solve, share, but I always think that there's a fourth one implied see safe to speak up, solve, and share. Or maybe that's assumed in some organizations and then doesn't get copied into others. But I was wondering maybe, Steve, if you first could talk about some of those habits or the wiring in your experience, that creates the psychological safety so people do feel safe to get from C to solve with speaking yeah, no, Mark, that's great.

Gene Kim: And just to link back the CSOL share, that was something I realized around 2005 when I wrote that article fixing healthcare, and it became the skeleton around which I draped the entire book, the High Velocity Edge, and kind of connecting the two works. I think the High Velocity Edge is a book in some regards about linearization, one of our simplification techniques. And it's a book a lot about amplification to unpack. In that book, I make the argument that critical is that you design whatever you're designing so you can see what's wrong with the design. So you design things to see problems, and that's supposed to be the trigger, that when a problem is seen, it's swarmed, so it can be solved.

Gene Kim: Contained first, but then solved. So see, solve, and then what's discovered locally can be shared, systemically spread, or shared. The fourth part, I worked with a client who, they came up with a fourth s, which they call sustain. And what they mean by sustain, they just wanted a fourth s is the leadership role in actively keeping the wheel spinning to maintain that angular momentum. Because just like you pointed out, is that the whole notion of raising one's hand to say, yo, this is not working right now.

Gene Kim: I see the problem, and I'm calling it out. That's not a natural act. It's certainly not a natural act in traditional Japan, which was coming out of samurai culture and the militarism through the 40s. But the Toyota people said, shoot, the only way we're going to become not sucky and actually become competent than world class was. We got to give opportunity to people to call problems out.

Gene Kim: And we're finding this, Mark, I'm sure you find this everywhere you work. And Gene, too, which is the pivotal moment, is when the most senior person is consistently present in the workplace. And they say, what are you working on now? And what is compromising your best effort? And we're doing this in a place right now where a guy shows up every day and people say, oh, what's that senior person doing there?

Gene Kim: And that took weeks to just culturalization, where it's like, oh, he's here again. Oh, he's here again. Well, I guess it's just normal for him to be there. And then he started asking, what is compromising your ability to do an outstanding job? And people started telling, then, what's the next part that's so critical, Mark, is he responded to it.

Gene Kim: It's not just know, call it out, but call it out. Two digressions real quick on this. We had a doctoral student who wrote his dissertation compare two plants both had and on cords. And in one, no one ever pulled the and on cord. And the other one, it was being pulled every 40 minutes by every individual.

Gene Kim: And the thing was, the place that no one pulled the and on court they should because they sucked. I mean, they were terrible quality, productivity problems there all the time. So he goes in there and says, why don't you ever pull this cord? And they said, oh, no. Well, one guy says, well, I was pulling it because I didn't have materials, I didn't have instructions.

Gene Kim: I didn't know how to do my work. I pulled the cord. No one showed up. And then his colleague says, well, it's a good thing no one showed up because let me tell you what happened when I pulled the cord. Oh, they showed up all right.

Gene Kim: Now in the factory where people pulled the cord all the time. He said, well, how come you pull it all the time? They said, because we start with the assumption that the environment should be designed, that I can succeed, to do something valuable that I'll be appreciated for. And they've told me if that's our baseline, that is designed for me to succeed in a way that I'm appreciated. They said, if we violate that, let us know what's the response when he pulls the cord, that someone shows up and says, oh, Mark.

Gene Kim: Oh, Gene, what's the problem? How can I help? So anyway, Mark, to this point. You're absolutely 100% right. It's not even the safety.

Gene Kim: It's the encouragement and the reward. Raise the hand. And where does that come from? It's from the senior leader who's present, persistently present in a very empathetic way.

Steven Spear: Yeah.

Mark Graban: Well, I want to give a quick shout out, because your story of the factory, of why don't they pull the and on cord? Touches on the two things. I don't know if you're familiar at all with Professor Ethan Burris from University of Texas at Austin. He's done research of why do employees choose to not speak up? And if it's not the fear factor, I get yelled at, it's the futility factor of, I pulled the cord and nothing happened, so I stopped.

Gene Kim: Right? Yeah, why bother? It's a waste of time.

Mark Graban: It seems very universal, sadly, in research, that those factors keep coming up.

Steven Spear: If I can add one thing, I think one of the neatest kind of data points in my journey, it was a project called Project Oxygen, and I think before that was called Project Aristotle at Google. And essentially it was this multi year study that spanned over 600 teams and really tried to ask what makes great teams great? They found that one of the top predictors was really, it wasn't a sense of mission, it was really around. To what degree do people on team feel safe to say what they really think without feeling like that they're going to get ridiculed, made fun of marginalized, et cetera. And they found it not just in the engineering teams and software teams, but also even sales teams.

Steven Spear: And so this is actually repeated year over year. And so when we did the state of DevOps research across population study that spanned 60 years, 36,000 respondents, again, there were like two factors that predicted this amazing performance. One was that notion of organizational safety, the ability to say what you really think. And the second was architecture. In other words, how do we wire our organizations that really dictate how easy is it for us to do our work easily and welL.

Steven Spear: And I just love this quote that we put into the book. Winston Churchill once said, we shape our buildings, and thereafter they shape us. And so too, with the systems that we create, the management systems that we have to work within, we shape it, and then forever after, it shapes us. And really, I think the goal of the book is to show what are the most important things to get right, and there are only three, and really make the case of why each one of them work that hopefully people will recognize when they survey the Toyota production system. Lean, Agile, DevOps they all have common.

Gene Kim: Mechanisms at work, high reliability organizations and all the other acronyms and terms and Reengineering and this and that. If you read deeply into them, the ones that have substance, they all come back to. We either change the conditions in which people are asked to solve problems. That's the slowification. We've actually changed the nature of problems themselves so they're easier to solve.

Gene Kim: The simplification, or we've just made it so obvious that you have to draw attention on the small thing versus not, and you respond to it. That's the amplification. And we even have a nice Venn diagram in the book, which we repeat a couple of times, which just shows how each of these very popular practices and tools, how they're at least one, but typically some combination of two and even three of slowification, simplification and amplification.

Mark Graban: And it seems like in any of the study of other organizations, there's just the risk of people getting a part of it. They installed the and on cords and didn't behave the same way as leaders might at Toyota. You talked here about frequent site visits by leaders. I've been in manufacturing companies where you didn't want the leaders going there because they weren't going to behave the way that I think one quick story of trying to play defense of keeping a vice president of Lean Six Sigma away from a shop floor team, because it's just the real quick story of, like, this is why I'm thinking, like, go to Gemba is not a panacea. We were kind of trying to guide him as we walked down the stairs and out in the vacuum, like, okay, we're going to an area, but this one machine's been down for like a day and a half.

Mark Graban: So it's just bracing him for what he was going to see. We started going on this rant of like, well, we need to send those workers home early, because then they'd have incentive to get the machine up and running again. And I'm like, this machine was older than me at that point. The machine was over 30 years old, and this guy was just so far out of touch with, boom, any of it. We're like, please, no frequent site visits by him.

Steven Spear: Right?

Gene Kim: So, Mark, I'm going to do a rant about that. No, it's fantastic, because you get that attitude of, we throw an appendix at the back of the book which takes shot at a lot of these conventions, that it's all about incentives. If we just pay people the right way and measure them the right way and pay them according to the right measurements. We all know that if you go anywhere, shop floor, deck, plate, studio, laboratory, nursing, that's not how it's working. But the thing is, all that ridiculous thinking and then it gets phrased in terms of accountability, we got to hold people accountable.

Gene Kim: You take your anecdote, it's the perfect inversion of accountability. So that jackass comes in, ooh, sorry. BLEEP. That unelevated executive comes in and he's wanting to hold the workers accountable. You know what?

Gene Kim: Because he's going to send them home early and dock them to pay because they're not doing their work. But who's responsible for having competent equipment on the floor that they could do their work? Holy cow, it's him. Right? And so in the outstanding organizations, the senior leadership is not only present and persistently so they understand the accountability.

Gene Kim: And the reason they're present is to find out their accountability, to make sure the machine is fixed or the engineering instructions are in place, or the material is properly repaired, or this thing, or that thing. So when the nurse, the doctor, the machinist, the mechanic, the coder, the chef, whatever, when they show up in that moment of actually doing the beautiful thing they have to do to create something of value, the conditions are prepped for them to do that. And if they're not prepped, whose fault is that? The machinist? No, she showed up to do her job.

Gene Kim: Is that jackass senior executive who didn't prep the situation?

Steven Spear: Mark, can I add one story just to give a software example of exactly that? So one of the stories, pairs of stories I'd love in the book is like, how could the Apple iPhone. In the early stages, it was like ten software engineers beat Nokia. And one of it is that they had a very small team, but they had everything they needed to quickly iterate and generate new builds and even figure out how do you make a keyboard that someone could actually type on when it was even less than the width of a credit card? And it's an interesting case study to look at what happened at Nokia that had 24,000 software engineers.

Steven Spear: And there's this phenomenal book called Transforming Nokia by Risto Salasma. And he described how, as the board chairman, actually, before he was the board chairman, as one of the board members, he said it felt like being hit in the sludge. Like in felt like being hit in the head with a sledgehammer. When he learned from the VP of strategy at Nokia that the compile time for the operating system that Nokia was relying on to compete against Apple was 48 hours, because he said if any engineer took 48 hours to learn whether change worked or would have to be redone, then all of this operating system was an illusion. He said, when I got to talk with him, I asked him, it seems like such a tactical measure, 48 hours, compile times.

Steven Spear: How did you detect that as a signal that was important to you as a board member? And he said, in any organization, you have to ask who is doing the most important work of the organization, and then how easy is it for them to do their work? And when he heard 48 hours compiled times as a former developer, he said, it's impossible for them to actually get. That's just one piece. To actually put together the whole and see if it actually worked together took two weeks.

Steven Spear: And he said, there are two reasons why this could be the case. Senior leadership didn't know, and that's a problem. Or senior leadership did know, and that's even a bigger problem. And that led to the firing of the CEO. And I think to Steve's point, I think what we need in these leaders are systems thinkers who can see the wiring of the organization and detect these sometimes weak signals of failure and do the right thing so that people can do their work easily and well.

Steven Spear: Yeah.

Mark Graban: I apologize that we have kind of a hard cut off here time wise. I would enjoy carrying this on. Maybe we can do this again after the first of the year and get questions or input from people who've started reading the book and open invitation one or the both of you. Or, heck, I could just open up a Zoom room and fireside chat with Gene and Steve, and I'll just get out of your way. But it's always a pleasure talking with you both.

Mark Graban: Gene, I'm glad we could record it here in this venue. This is the first time, right? I had to go and double check that.

Steven Spear: Absolutely.

Gene Kim: Okay.

Mark Graban: But let's not let it be the last. You're not quite close to Steve's giant trophy level of guest appearances. Again today we've been joined here by Gene Kim and Steve Spear, co authors of the new book, Wiring the winning Organization, Liberating our collective Greatness through slowification, simplification, and amplification. Two for two on that. So thank you for being here.

Mark Graban: Thank you for the book. Can't wait to get deeper into it, even though my questions may have implied I only got through the title on the front cover. But thank you.

Steven Spear: Great. Thank you, Mark.

Mark Graban: Thank you both. This has been fun.

Gene Kim: Thank you.

Mark Graban: Thanks again to Gene and Steve. Look for links in the show notes. Or you can go to leanblog.org four nine three. If you have questions for them for a future episode, you can email me. Mark@markgraban.org thanks for listening.

Gene Kim: This has been the Lean Blog podcast for lean News and commentary, updated daily. Visit www.leanblog.org. If you have any questions or comments about this podcast, email mark at leanpodcast@gmail.com.


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Mark Graban
Mark Graban is an internationally-recognized consultant, author, and professional speaker, and podcaster with experience in healthcare, manufacturing, and startups. Mark's new book is The Mistakes That Make Us: Cultivating a Culture of Learning and Innovation. He is also the author of Measures of Success: React Less, Lead Better, Improve More, the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, and the anthology Practicing Lean. Mark is also a Senior Advisor to the technology company KaiNexus.

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