How to Guarantee Non-Results: Fund Problems, Not Solutions




Editor's Note

It seems so elementary. You would think everyone understands it. There's a big difference between a problem's symptoms and its root cause(s).

Even when the assignable cause (a.k.a. root cause) of a management problem is known, in many instances, there is a reluctance to implement the appropriate solution.

Further, there is always more ignorance with respect to what could really be causing a serious management problem than fundamental knowledge of what the likely cause is and what must be done.

It should be mentioned–indeed, emphasized–the purpose of continuous self-learning, organized programs for sharing of best internal practices/experiences and formal leadership/management courses (hopefully) provides managers/executives with the width, breadth and depth of methodologies and concepts to pinpoint assignable causes of mission-critical management problems.

For example, if innovative activities/projects/ventures at a given organization continually fail or have a very low success rate, it may not be realized by practitioner managers the solution may reside in the establishment of separate centers of initiative (i.e., autonomous, separate business units).

The maintenance of the present business is far too big a task for the people in it to have much time for creating the new, the different business to capitalize on a different tomorrow.

As we have discussed in other CLN articles, organizations that exist to get today's job done cannot also do tomorrow's job very well. Tomorrow's job needs a new structural entity, staffed with first-class talent, and funded and measured differently than the ongoing organization.

The appropriate management training programs go a long way in helping practitioner managers understand the assignable cause of many failed attempts to innovate and possible remedies.

Without the right kind of training/self-learning programs, practitioner managers may not be able to identify the root cause of many reoccurring management problems. They will fall prey to the tendency to continue to treat the symptoms rather than the true cause of the problem.

This article, hopefully, sheds much-needed light on why many organizations of all kinds (businesses, not-for-profit, government agencies,) are prone to fund problems rather than fund solutions.

The Problem of Defining the Problem

Said Peter F. Drucker: "Practically no problem in life–whether in business or elsewhere–ever presents itself as a case in which a decision can be taken… What appears at first sight to be the elements of the problem rarely are the really important or relevant things… They are at best symptoms… And often the most visible symptoms are the least revealing ones…"

Drucker's point? The first job in decision-making is to find the real problem and to define it. Drucker wrote extensively about why many management decisions are based on symptomatic diagnosis rather than root cause analysis.

That said, to arrive at a real solution to a well-defined management problem requires, first, discovering the root cause of the problem. Otherwise "throwing money at the problem" and continually obtaining embarrassing non-results will continue to occur.

Said Drucker: "You don't make a decision about symptoms when you have a fundamental, underlying, degenerative structural problem."

Take-home message: " Attempt to 'doctor symptoms' rather than search for the "root causes" and you're nearly 100% guaranteed the problem won't be solved."

This article provides you with symptoms/root cause basics and some likely causes for reoccurring management problems not normally discussed in typical leadership programs.

A Simple Example and its Lessons

Let's start with a simple example. Organizations who claim they have a cash flow problem are incorrect. What they have is a cash flow consequence.

Inadequate cash flow is a symptom. What's the cause?

It could be a pricing problem, lack of salable products, inadequate or the wrong distributive channels. It could be poor financial planning, that is, lack of financial foresight that would have prepared the organization for rapid growth.

It could be a failure to craft and implement a unique selling proposition, an irrational product line or poor product design leading to out-of-control field sales costs. The list of possible causes is endless.


Funding Problems vs. Funding Solutions

How many times have you heard/read a story about a new venture that successfully launches a new product, grows fast with respect to sales and profits, issues rosy forecasts and gains much media attention?

Then, without warning, it suddenly becomes awash in red ink. Lack of cash, inability to raise the capital needed for expansion, and runaway expenses, bloated inventories, and overdue receivables always seem to be the major afflictions.

Savvy investors or established companies in the market look for the "root cause" of these afflictions. They know they are "symptoms" of a deeper, underlying problem.

Giving an organization more cash to make up for the cash shortfall, without rigorously diagnosing the reasons for the deficit, can be called “funding the problem.

If, however, the root causes of the problem are identified and needed corrections can be made to make the company profitable, then “funding solutions” could be a wise decision if the expected return on the additional invested capital is attractive.

Everyone agrees with this. It makes great sense. Plenty of yo-yo nods when this is explained. Unfortunately, the practice of this universal wisdom is not as commonplace as it should be.

Some Useful Management Examples Of Defining The Wrong Problem

Management may see efforts to effectively compete on analytics falter and blame L&D for inadequate training programs; the real problem may well be the existing organizational structure which impedes assimilating today's groundbreaking technologies. 

Management may see retail sales declining in a given geographic area and attempt to boost advertising to retrieve market share; the real problem may well be E-tailing competitors or even a demographic shift to the suburbs which is causing the loss of customers (this would point to a location problem not an under-selling problem).

Management may see a clash of personalities, high turnover, absenteeism, & declining profitability; the real problem may well be the need to change its basic structure because the organization has grown significantly in size which makes the organization ungovernable, unmanageable and uncontrollable. Any organization that doubles or triples in size is usually in need of a radical change in organizational structure.

Non-Business Institutions Are The Worst Offenders of The "Funding Problems Syndrome"

The worst offender with respect to "throwing money at problems" is government. Indeed the inability to stop doing anything, that is, abandoning the unproductive and the obsolete is "a major reason why annual federal deficits are growing at an alarming rate."

Even though it is now fashionable to preach "smaller government," it won't work. We need strong, effective government. Indeed, we can expect more rather than less government in the years just ahead.

The new tasks–combating cybersecurity threats, protection of the environment, catching up to the Russians and Chinese with respect to their recent (not yet developed by the United States) advancements in military warfare, making arms-control more effective and the like–all will require more rather than less government.

However, today's government is loaded down with things that no longer work, never worked, and things that have outlived their usefulness and their capacity to contribute to meaningful results. In short, many government activities and programs are result-less. (We'll discuss how to identify candidates for abandonment in future articles).

The Needed Welfare System Turnaround–Funding Solutions

The welfare system provides a good example of how "funding problems" rather than "funding solutions" leads to never-ending embarrassing non-results.

Most thoughtful people realize America's (as well as many other countries) welfare system creates dependence, learned helplessness and low self-esteem.

Said Drucker in 1995:

"Welfare can work… But only if the axiom is changed from 'All the poor need is money," to 'All the poor need is competence."

… According to Drucker: "… By itself, alone, money encourages incompetence and irresponsibility… Today's welfare focus is on needs… There will be true 'welfare,' however, only if the focus is on results."

Never have truer words been spoken. What's required to do this? As is always the case, first-class people must always be allocated to major opportunities. And first class opportunities must always be staffed with people of ability and with proven track records.

Simply put, to make this happen requires government decision-makers that want to "fund solutions" not continue by just "throwing money at problems." People who are trained and deeply experienced in making the right things happen–not just in making speeches.

Take-for example–the under-reported work of the Trump administration (under the direction Ivanka Trump) to aggressively promote and help finance workforce development, that is, skilling, re-skilling & up-skilling. Her thoughtful program includes earning while learning initiatives including the removal of many restraints that prevent people from participating in a life-changing opportunity to acquire needed skills.

Many states (e.g., Iowa and Indiana) are helping subsidize organizations in a variety of ways to provide those willing and able to learn new competencies & to earn salaries of $60-$80,000 per year. This increases future tax revenues and, properly viewed, is a true war on poverty.

Also, the pioneering work of Mike Rowe in organizing programs for supplying needed competencies to a wide range of minority groups and others are steps in the right direction. If welfare starts providing results such as these programs indicate it can, welfare would be cheap even if it cost twice as much.

Funding domestic welfare policies, that is, solutions that provide positive incentives to fund not going on welfare in the first place, and for not staying on it, requires political courage, political imagination, political innovation and political leadership.

Many believe this is what welfare has to be. In other words, for far too many years the Welfare State has asserted the less fortunate and less competent/skilled deserve to be financially supported. That's funding the problem.

This is now changing (perhaps too slowly) that people can and should be restored to or equipped with required competencies which, in turn, leads to self-respect, and self-support. These are the results welfare needs to aim for and pay for.

But make no mistake: There will always be certain percentage of people who cannot take advantage of competency-based programs for a variety of legitimate reasons and, therefore, should be financially supported.

In Conclusion

Sports coaches help people realize their full potential; they know why slippage occurs in untrained athletes; they know the often simple points that must be mastered to help individuals significantly improve their playing performance.

Yet few people–especially, elected officials at the local and state levels–have ever had any systematic, well-organized training programs (coupled with coaching/mentoring) on how to make effective decisions.

We believe many people, in fact most, are almost completely self-trained in decision-making. Learning a rigorous, disciplined step-by step approach to making the right decisions (and thereby avoid colossal blunders) could work like a miracle drug in combating making decisions guaranteed to produce non-results. At least, it's a first step.

Make no mistake: in addition to the decision-making process, executives/managers have to be trained in a variety of core disciplines which definitely assists in making better, more informed decisions. 

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