Posts Tagged ‘assumptions’

Credit Union "Micro" Strategic Planning

Wednesday, May 11th, 2011


Credit unions face a challenge typical to many small- and medium-sized businesses: how to make the annual Board of Directors/Management micro retreat an engaging session that sets the strategic direction for the organization. I call these "micro" retreats because small businesses do not have the time or resources to devote more than a day — and sometimes less — to the entire strategic planning process. So everything has to be scaled down, miniaturized.

Critical success factors


Too often, a board and management team show up for a strategic planning event to find a facilitator and blank chart paper. There has been little preparation and the decision-making process is opaque. The team grinds through the day, fails to agree to priorities, and finishes spent and frustrated.

Alternately, a successful micro retreat depends upon four key factors:

  • A lean strategic planning process
  • Preliminary research and detailed preparation
  • Dynamic group process and skilled decision support
  • Strong, consensus agreement to act

I will use a case study to illustrate each of these factors. Since 2003 Bridgeway Federal Credit Union has used Prism Decision Systems to facilitate its strategic planning. According to CEO P. J. Walker: "I contact Prism whenever I am ready to schedule a strategic planning retreat with my Board of Directors and executive staff.  Not only is Sean Brady an excellent facilitator, but he utilizes the most advanced technology to arrive at critical consensus and decision points for the group."

Factor #1: A lean strategic planning process


First, we need to determine which strategic planning process steps are most critical, can be skipped or can be completed before or after the micro retreat. For example, Bridgeway has a vision and mission they consider appropriate. No need for time spent there. Instead, because they typically faced a fork-in-the-road strategic decision, we customized the lean process to make that decision, and then to agree to a set of long-term targets and robust strategies to implement it. Project planning, identification of key milestones and a progress monitoring plan were assigned to be completed at a later time.

Factor #2: Preliminary research and detailed preparation


The CEO and his team determine the key information to be researched and the critical presentations to be prepared. Some research and preparation is "boiler plate," common across business sectors:

  • Five-year trends and three-year forecasts of key performance indicators
  • Updated progress implementing key strategic priorities
  • Current and emerging issues related to legal, regulatory, information technology, competitive environment, customer demographics, governance, mergers and acquisition, etc.

However, some is very specific to the organization. For example, Bridgeway prepared detailed presentations of alternative business case scenarios and financial plans to support the strategic decision they needed to make.

Factor #3: Dynamic group process and skilled decision support


Often without expert group process support, retreats ramble unproductively, leading to high levels of participant frustration and poor decision-making. Groups begin debating before they fully understand the available alternatives. They move to decision-making before they have evaluated the costs and benefits. They leave without explicit agreement and a strong, consensus commitment to act.

Prism’s efficient group process avoids those pitfalls. For example, after CEO Walker presented the business case scenarios, there was a structured question and clarification session to ensure that all 16 team members fully understood the alternatives. The group then went through a formal process to evaluate each scenario. They challenged key assumptions and assessed cost-benefit ratios. Only then did the team move to decision-making, which is accelerated and improved using Prism’s group decision support system. The Bridgeway team participated in a number of consensus votes, as well as a strategic profile (see chart above). Strategic profiling helped the team distinguish between high- and low-leverage strategies — and therefore to identify immediate priorities. By not considering all strategies to be equal, Bridgeway targets its limited resources at those opportunities providing the "greatest bang for the buck."

Factor #4: Strong, consensus agreement to act


Finally throughout the micro retreat each key decision is tested by a deliberate consensus process. For example, as the Bridgeway team began to converge on what appeared to be the group’s preferred fork-in-the-road decision, we voted to determine the degree of consensus support. The vote revealed that 14 members supported the decision but two absolutely could not. The process then required the two to articulate their irreconcilable issues. After the rest of the group listened respectfully, the whole team problem solved, addressing the "deal breaker" issues. Not only did the group then achieve consensus but they agreed that the final, modified decision was stronger as a result of the deliberate process.

The consensus chart below shows 12 members "strongly supporting" and four members "supporting" the final strategic plan. This public, explicit consensus assured that Bridgeway emerged from their micro-retreat focused and ready to act.

For additional information about Prism’s strategic planning with credit unions, see case studies with GHS and First Heritage federal credit unions.



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Changing Education Paradigms

Thursday, October 21st, 2010

Sir Ken Robinson’s fascinating, thought-provoking, and engaging animated narrative of the history of formal education, its current failures and a better path forward was presented upon the occasion of his receiving the Benjamin Franklin Medal by the Royal Society of Arts in London:

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Are Too Many Options Bad For You?

Sunday, August 15th, 2010

Ever since I read Sidney Parnes’ The Magic of Your Mind more than twenty years ago, I have firmly believed that having more options is preferable to having fewer options. On the other hand, just about every time I go to the grocery store, I wish there were fewer choices. So I am conflicted: my training and belief system tell me the more options, the better; my experience, sometimes just the opposite.

Research now validates the conflict I experience.

Sheena Iyengar’s fascinating presentation, On the Art of Choosing, discusses the impact of culture on decision-making. One of her key research findings is that the American belief that more options are better than fewer is not universally held by all cultures: “Though all humans share the basic need and desire for choice, we don’t all see choice in the same places or to the same extent.”

I find this interesting but not surprising. What did surprise me is her assertion that even for Americans, having too many options can result in poorer decision-making: “When there are too many choices to compare and contrast, the process of choosing can be confusing and frustrating. Instead of making better choices, we become overwhelmed by choice, sometimes even afraid of it. Choice no longer offers opportunities but imposes constraints.” In fact, Iyengar’s research demonstrates that when you give people “ten or more options when they are making a choice, they make poor decisions.”

To view Iyengar’s full discussion of the impact of culture on decision-making, click below. If you wish to go directly to her dismantling of the assumption that the “more choices you have, the more likely you are to make the best choice,” fast forward to 8 minutes 10 seconds.

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The Monkey Business Illusion

Monday, August 2nd, 2010


The video below tests your perceptual acuity. Listen carefully to the directions and then watch the video. (Note: if you think you’ve seen this video, you probably have not. It is a May 2010 sequel to the widely viewed 1999 selective attention test video that many of you probably have seen.)




How did you do? Miss anything? If you did, you are in good company. I, for one, counted the number of passes correctly but failed to see the gorilla in the 1999 version. And in this new version I missed the player in black dropping out. On a positive note: I did notice the color change!

Cognitive scientist Daniel Simons showed the video to 76 University of Illinois students. As reported in i-PERCEPTION, for those who had not seen the 1999 version, only 56% noticed the gorilla (23 out of 41). Just “11% of subjects noticed the curtain change, and 16% noticed the change to the number of players on the black team. Only 1 participant noticed both the curtain and the player change.”

Simons defines the phenomenon as inattentional blindness, “the failure to notice unusual and salient events in their visual world when attention is otherwise engaged and the events are unexpected.” In a Seed Magazine interview, he discusses the implications to our everyday life:

In inattentional blindness you’re not seeing something that’s right there because your attention is engaged. The most obvious practical application of that is driving. We intuitively think that if something important happens right in front of us, we will see it…Dan Levin has done studies where he just asked people, would you notice if something like this happens? He shows people the video, gives them the instructions, points out the gorilla, and then asks them “how likely would you be to notice the gorilla if you were doing this task and counting the passes?” Ninety percent of people say they’d notice. Regardless of how you ask that question, you get high confidence, and a high percentage saying “yeah, of course I’d notice that.”

That’s the intuition that’s interesting, and that’s the one that’s dangerous. If we were completely aware of these limits on attention, we wouldn’t do things like talking on cell phone while driving: We would know that it would make us just that much less likely to notice something. But we don’t have that insight into our own awareness. It’s only in that rare case where you actually have an accident that you become aware that you’ve missed something.

As Simon’s studies have demonstrated, we are all prone to innattentional blindness. What impact does it have on our problem solving? What salient events in our visual field are we missing, even though we are confident we are not? How often do we see what we are looking for and not what is there?

Post script

Science News reports on April 25, 2011 that a new study purports that multitaskers are better at spotting “invisible” Gorillas.


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Assumption Busting

Monday, March 1st, 2010


An idea that was useful at one time may no longer be useful today and yet the current idea has developed directly from that old and outmoded idea. It is historical continuity that maintains most assumptions — not repeated assessment of their validity.

–Edward DeBono, Lateral Thinking

____

W. E. Gordon, who died this week at his home in Ithaca, NY, designed and built the world’s largest radio telescope. The size of 26 football fields and nearly seven times larger than the next largest radio telescope, the Arecibo Observatory has been the source of great scientific discoveries, including proof that the gravity waves predicted by Einstein’s Theory of Relativity exist.

What was required for such a valuable innovation? Well, obviously, technical skill, creative thinking, persistence, and genius. The list could go on. However, according to his New York Times obituary, Dr. Gordon provided this insight: on the occasion of the Observatory’s 40th anniversary, he said that “he and his colleagues had not remotely grasped the challenges they faced. ‘Their saving grace,’ he suggested, ‘was that we were young enough that we didn’t know that we couldn’t do it.’”

In short, Dr. Gordon was not constrained by the governing assumptions of his day. Unshackled by their constraints, he was free to create what at the time was assumed to be impossible. Indeed, assumptions can act as a powerful constraint on our thinking. Consider the game of tether ball. Just as the pole and rope determine the distance and route the tether ball can travel, an assumption defines the universe of options available to solve any problem.

Creative problem solving and good decision-making often require assumption busting: identifying key assumptions, ruthlessly questioning their validity, generating new assumptions, and then asking “What if?” To complete the analogy, you need to dig up and move the pole; or even better: cut the rope and see where the ball sails.

While most of us are not on the cusp of an innovation on the scale of The Arecibo Observatory, we all face daily challenges. If you find yourself needing a breakthrough—at work, in a personal relationship, solving a technical challenge—identify your key assumptions. Challenge them. Find those that are no longer valid. Articulate new assumptions. And then seek your breakthrough among the fresh alternatives that emerge.

Photo courtesy of the NAIC – Arecibo Observatory, a facility of the NSF

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