Principle 6: Variability (Item 2)
All systems and processes exhibit variability, which impacts on
predictability and performance.
This is very probably one of the crucial issues in good management.
When you understand variation, you know how
to respond appropriately to fluctuations, you don't tamper, you don't
blame. You stop asking stupid questions that waste time and can begin
to ask useful questions that will lead to fixing systems.
When it comes to our business life, we usually forget our intuition
and suddenly expect that everything we produce, every service we give
or receive, every person we deal with, will be exactly the same
every single time. Or that when we run our process we will get exactly
the same result every single time. We intuitively know this cannot happen,
but behave as though it were not so.
Unfortunately, most managers are trained to think that variation is
abnormal and must be controlled. Traditional month-to-month management
reporting, such as exception reports, budget variances and month-to-month
comparisons, is typical of this old thinking. People are often asked
to explain what has happened, particularly where the variance is unfavorable!
Most management systems are built without an understanding of the concepts
in the simple example. Consequently, owners/managers/bosses blame people
rather than fix systems.
Do this. Stand up. Take you pen and balance it on your  outstretched finger.
Make certain your hand or arm is not resting on a table or some other
support. Balance the pen so that its point is exactly still.
Do not allow the pen to wobble! Have you done that? Why
is the pen wobbling? I know you can give many excuses about why the
pen is wobbling, but what were your instructions? Why can't you do this
simple task? A graph of the tip of your pen plotted against time probably
looks like this. The wobbling is variation.
The question "Why are you letting the pen wobble?"
is a stupid question, a boss's question. The question is stupid because,
given the process we set up, the pen must wobble. Employees
know that the boss's job is to ask stupid questions like "Why are
you letting the pen wobble?" Bosses know that it is the
employee's job to answer such stupid questions. Employees also know
that they can usually offer nothing better than excuses. They are caught
in a system that they did not create and which they cannot control and
the boss is demanding answers to questions like "Why are you
letting the pen wobble?" The question implies that the individual
can control the pen. Which is clearly not the case in the example.
The belief that asking, "Why are you letting the pen wobble?"
is useful is widespread. It has led to incentive and reward schemes
that mean "I will reward you for not wobbling the pen", an
impossible task. And to performance appraisal of "how you did at
keeping the pen still".
Another form of stupid question is "What caused that (particular)
wobble?" This implies that each individual wobble has a cause that
can be `tracked down and fixed'. This is the question being asked when
people are asked to respond to month-to-month comparisons and accountant's
`variance'. For example, an individual difference between a predicted
number (e.g. `budget') and an achieved number (e.g. `actual').
These reporting practices, although common, are very destructive of
good business practice. For the simple reason that it has people chasing
smoke. This results in people wasting time investigating systemic causes
of variation (e.g., trying to answer the stupid questions of the wobbling
pen) and, through intervention in the situation, exacerbating the problem.
For example, most air conditioning systems vary a little throughout
the day. If you grab the air conditioning control and turn it up every
time you feel a little cold and turn it down when you feel a little
hot, the poor air conditioner which is trying to meet the 22C that you
originally asked for is heating one minute and cooling the next. All
in an effort to catch up with your demands.
Consider some useful questions. "Why is the pen wobbling"
or "How can we stop the pen from wobbling – so much or at
all?" These questions are seeking information about the system
that is producing wobbles.
In finding an answer to these questions, we have to understand the
causes of the variation. Then we can get to a useful solution. To provide
a solution to this type of question requires that you change the process
that causes the variation. For example, to stop the pen wobbling so
much, we could have you seated and resting you hand on something.
To stop the pen from wobbling at all, we could clamp it. The
point is that this is another illustration of Principle 4 (`To Improve
the Outcome, Improve the System') —in order to change this
outcome (in this case the variation) we must change the process. In
this case, to reduce the variation, we must understand its causes.
If someone was to come up behind you and give you a push. The question
"What was that wobble?" is not stupid - because there is a
special cause — a push.
 Because of the strong
interconnectedness between variability and systems, much of the discussion
of Principle 4 (`To Improve the Outcome, Improve the System')
could be reproduced here - especially the sections on Process Capability.
We will not do that. In Principle 6, we will stick to specific examples
about variability. Variability is probably the one area where most people
have most difficulty.
Consider this finding in terms of performance appraisal. Everybody
has good days and bad bays. Suppose you had a policy of giving praise
when someone did very well and delivering an admonishment when they
did badly. Believe it or not some bosses do have such policies. Let
"good" be "up" and "poor" be "down"
on the wobbling pen graph above. Immediately after poor performance,
when an admonishment is delivered, performance usually improves. The
policy clearly works — admonishments cause performance to improve.
However, immediately after the good performance, when praise is delivered,
performance usually goes down. Woops! You knew that praise stuff did
not work! Better to stick with the reprimands they clearly work. Or,
perhaps you should understand and expect variation in the performance
and do neither.
Clearly, variation is an important consideration that should be considered
as part of performance management, but seldom is. Most people (99%)
perform around average within the systems that are around them. Some
days are good and they perform a bit better than average. Some days
are bad and they perform a bit worse than average. Overall neither good
(deserving praise) nor bad (deserving sanction). Just average. Ranking
people who are all performing about average becomes a real nonsense.
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