by AARNI HEISKANEN, AEC Business
This article was originally published to the AEC Business blog on January 21, 2016.
I’ve attended numerous seminars and workshops that came to the same conclusion: construction must become more customer-focused and, at the same time, productivity must go up. In spite of even substantial investments in development projects and change programs, very little has changed. Could a culture of experimentation come to the rescue?
Recently, I’ve had very interesting discussions with business coach Mikko Taskinen. We both have helped companies and organizations with change programs and development projects. Mikko has helped steering groups and managers explore, develop, and maintain their ability to change. I have provided vision, strategy, and innovation consulting.
We both have experienced the same challenge. Visionary managers who have a need to renew or at least substantially improve their companies are faced with the “realities” of the business. Change programs with good intentions never get off the ground. Employees are occupied with their daily routines and middle managers don’t see the value of changing old habits.
Ways to encourage change
The ultimate driver of change is a crisis. Some business thinkers have even claimed that a CEO can only succeed if he or she is able to create and maintain an atmosphere of crisis and uncertainty. Surely, this cannot be the only way to renew an organization?
Development projects and change programs are another, less disturbing way to introduce change. However, companies tend to focus too much on goal-setting and planning, and too little on learning and doing. The programs easily become too ceremonial, abstract, and distant from employees’ daily routines.
Experimentation as vehicle for change
In construction, visionary managers are rare. In fact, a “no-nonsense” attitude is considered a virtue. Many construction industry companies are not doing great financially. Perhaps the old way of doing business, as rational as it may seem, no longer pays off. Customer-centricity is not possible, since it would ruin a project’s budget. Productivity remains poor because information and processes are not in control.
What should a construction industry company do if it wants to improve? I think that many great things in construction have started small. Someone with a problem comes up with a duct tape solution. When that solution works, others follow and improve it. Finally, the original solution changes the whole business or creates new businesses.
I think that there has always been a culture of experimentation in construction, but it has been overrun by a culture of exploitation.
Culture of experimentation
Is it possible to turn grassroots experimentation and innovation into a corporate culture? There is evidence that some companies, especially in engineering, are encouraging teams and projects to experiment systematically. This is formidable, especially as many firms are struggling with tight or no budgets for experimentation.
Experimentation should not be haphazard. However, the end result and the path toward it can vary. Certain elements, like management commitment, the possibility of challenging roles and habits, interaction, communication, and metrics form the framework for experimentation.
Individuals and their attitudes, preconceptions, and interactions are challenged during experimentation. That’s why it can be a tough sale to experts and middle managers.
What to experiment on and how
Technical experiments are self-evident, but only a part of the story. Your company can re-examine and re-imagine everything in your business, starting with the way you bid for projects. The list is actually endless: how you communicate with clients, how you collaborate with subcontractors, how you reward employees, how you buy, how you manage information, and so on.
Experimentation does not always lead to anything useful. That’s the hard fact that you’ll have to accept. However, it always leads to learning. In fact, experimentation is learning how to learn. Experiments create stories of success or failure. Stories have the power to change people’s thinking and behavior. Read my interview with Sweco Structures, and you’ll see what I mean.
The point is that you do something real. Sometimes it is time to turn “plan-do-check-act” into “do-check-plan-act.”
Adaptive companies will flourish
Companies that are capable of experimenting, learning, and implementing what they’ve learned can become adaptive. Adaptive corporate cultures are most effective in driving financial performance (see Research from Charles O’Reilly et al.).
How can a company become more adaptive? Viktor W. Whang, in his book The Rainforest: The Secret to Building the Next Silicon Valley, compares the rules of the rainforest (for innovation) with the rules of the plantation (for production):
Plantations are necessary, but having a rainforest in the neighborhood opens up new opportunities. Ideally, a company has elements of both ecosystems. Is your company ready to take a step into the rainforest?
Aarni Heiskanen is the managing partner at AE Partners and co-founder of Thinking Portfolio. Based out of Finland, Aarni boasts 15 years of experience within the design community, both as an architect and as an architectural R&D pioneer. More recently, Aarni has become an industry thought-leader via his books, articles, blogs and podcast.