Castles in the Sky

One of the signs that an organisation is not in good health is when grand plans are being mooted while the basic functions are deteriorating. Tesla is a good example of this. What they need to do is figure out how to mass produce cars, deliver on customer expectations, and turn a profit. Instead Elon Musk is talking about building a network of tunnels beneath LA to relieve congestion. This is probably a distraction, but in other cases it’s simply a matter of the leadership being too distant from the coal face to understand the basics. Added to that is the ego of those who end up in charge believing they’re put on this earth to deliver grand projects to the masses, and the nuts and bolts that hold everything together are unimportant or beneath them.

A few years back I was pulled into a meeting where an enthusiastic young engineer was explaining the new project his department was undertaking. It would be a colossal interactive data centre containing every piece of information an oil company engineer could ever want to lay his or her hands on: drawings, 3D models, specifications, spare parts lists, process parameters, production figures, you name it. Data for every facility in the company would be centrally stored, updated in real time, and accessible to anyone who needed it. This project was backed by senior management right up to the CEO, who may or may not have recently attended a lecture in which the term “information is the future” was used. I was asked my opinion on it, and I said I thought it was absolutely fantastic, a brilliant idea which would transform the lives of every engineer working in the oil industry. Sadly, it was hopelessly unrealistic. One of the absolute basic functions of an oil company is to maintain up-to-date drawings of its facilities using an industry-standard document control system. My outfit couldn’t even manage that. The drawings were not available let alone updated, and the Engineering Managers to whom the responsibility fell either didn’t understand this was a key part of their job or they simply didn’t care. Either way, we had demonstrated we lacked the organisational and cultural discipline to run a standard database with a tenth of the complexity of the one they were proposing. In fairness, nobody disagreed with me on my assessment of our current performance, and admitted if this new system was to work we needed “a new culture”. Good luck with that.

Similar things were happening at the corporate level. I may be old fashioned and my views outdated, but I’m of the opinion an oil company’s long-term success depends largely on its ability to discover new oil reserves and its project management capabilities. Despite enormous expenditures and several large gas discoveries, we’d not found a sizeable oil reservoir in years (they still haven’t). As for our project management capabilities, we seemed incapable of bringing a project on-stream without years of delays and cost overruns which needed a widening of the columns on Excel spreadsheets to display. The reasons for this were pretty obvious to anyone who’d wandered the corridors for long enough with their eyes open (massive loss of expertise through retirement being the chief cause; compulsory gelding of all male managers another). But what was occupying the minds of senior management? A branch-out into renewable electricity generation and supply. Getting an oil company to supply your electricity is a bit like getting the army to organise your son’s twelfth birthday party. Which, to be fair to European armies, is something they’d probably do better than defending their borders.

Another example of leaders announcing grand plans while the foundations on which they stand crumble appeared on Twitter this morning:


Angela Merkel couldn’t even manage to hold onto the leadership of her own party, and remains Chancellor only because Germany is so divided nobody can agree on a replacement. Emmanuel Macron jets from one international conference to another while the biggest mass protest movement seen in France since the sixties sets Paris on fire each weekend in opposition to his rule. Yet here they are announcing that Europe should become “the new shield for the people” under a Franco-German alliance that nobody else seems to know about.

One of the reasons so many British MPs are against leaving the EU is because it will force them to abandon the grand schemes they hope will get their names written in history books, and return to the mundane task of governing which they consider beneath them. In business as in politics, it’s a widespread problem with so-called leaders everywhere.

Liked it? Take a second to support Tim Newman on Patreon!
Share

21 thoughts on “Castles in the Sky

  1. Talking of Macron, I saw something that said on the first of his grand debates he spent 2 hours making a speech. The sel awareness of à Richard Murphy.

  2. Spot on!
    This summarises every middling-to-large company I have worked for. The disease seems widespread.

    But what ideas for a cure? There’s the challenge…

  3. One wonders to what extent the entire EEC/EU period of the UK’s recent history was driven by the desire of the senior politicians to be able to strut on a larger stage than the post-Empire UK would allow. It must be a great shock to someone like Cameron that he wouldn’t be able to swan around Europe having Heads of Governments meetings with big cavalcades of limos and helicopter rides etc, and have to attend Parliament week after week and have his Cabinet discuss things like how often people’s bins should be collected, and what the the appropriate hygiene rules should be for kebab shops. Its not really what a narcissist signed up for……………….

  4. The cure is for the companies to be taken private and the fat trimmed. If the idiocies in the oil companies as as bad as TimN says, I predict mega takeovers by some of the big PE firms.

  5. Jim, my enthusiasm for the EU took a dive when I realised that it was a way for failed politicos such as Kinnock to strut around and achieve more power and influence than he was ever entrusted by his electorate. Then you look at absurdities such as Tusk, Juncker and Verhofstadt… Who would ever put them in charge of anything more than a sweet shop or very unimportant country?

  6. When I started reading this I assumed this had been prompted by some tweets by The Secret Barrister. The courts IT is basically appalling. They have email down all the time. Email. Seriously, to everyone else, email is utility IT. It’s there all the time. You don’t have problems. At the same time, courts IT are talking about a shiny, glorious digital future.

    This sort of thing nearly always reflects bad management. It’s continual, marginal improvement that works. In the case of your oil company, you get standard drawing software in and get the plans on it. Preferably one that can integrate with other software, so you can integrate it with other information. Something that adds value to people working there. Then, you do the next thing.

    When people plan a Glorious Future, they never get anywhere. They just keep imagining. “well, maybe the Glorious Future will need this” and so they start tearing up the plans and drawing new ones.

    The best startups start by providing the Minimal Viable Product. You might dream of a great future, but what’s the minimum that is of use to a customer. Remember, Amazon started selling books. Bezos’ plan was always to sell everything. The logo literally has A->Z in there. But he implemented Amazon in stages. And he was really smart – everything is built in their software as a service, so it’s easy to fit things together and change them for the future.

  7. The cure, as far as companies are concerned is creative destruction. Alter the regulations that make start ups difficult and hamper small company growth, remove protective tariffs and they will either sharpen up or be replaced.
    Of course the present management hates that idea, hence their love of the EU which provides them protection.

  8. When I started reading this I assumed this had been prompted by some tweets by The Secret Barrister.

    I don’t read or follow him/her. After the self-serving garbage they wrote about Tommy Robinson’s arrest followed by a very mealy-mouthed explanation as to why they were utterly wrong, I have no inclination to read anything else by that person. That said, others tell me they write some good stuff; I just don’t think I could trust they’re telling the truth in all instances.

  9. @Tim the Coder 10:23 23rd January: “But what ideas for a cure? There’s the challenge…”

    Competition. Which EU rules stifle for new entrants. Get out. Totally out. Now.

    *edit* Ah – Pat just above beat me to it!

  10. Lockers: Agree completely, and then cut the corporate welfare.Let the big incumbent incompetents go bust. Make space for smaller, well run outfits.

    But thinking back to my conman(sorry, contractor) days, the great advantage of Flights of Fancy like a “Glorious Future” is that it can run for years before hitting the Concrete Pavement of Reality. Thus very little sanity check on what has been done or delivered. So much easier than all that tedious running the business, serving customers and making profit nonsense: there’s a bureaucratic empire to build!
    As a manager, the trick is to know when to jump ship. As a contractor, the rubble is often as lucrative as the Grand Project that created it. There’s always the recently departed manager to blame! 🙂

  11. NB TimN, I’m a little surprised there’s not been a blog post on the Californian electricity company, the cause of the dreadful wildfires, and the departure of their CEO (with massive payoff) shortly before the company files for bankruptcy under all the damage claims…
    Hits a lot of your topics, though I cannot say if she is a pink haired cat collector, etc.

  12. “Either way, we had demonstrated we lacked the organisational and cultural discipline to run a standard database with a tenth of the complexity of the one they were proposing. In fairness, nobody disagreed with me on my assessment of our current performance, and admitted if this new system was to work we needed “a new culture”. Good luck with that.”

    You don’t just need a new culture: you need the Holy Trinity of People, Process, Technology.

    Shiny new tech will never fix a mess created by dodgy people and processes. It usually just makes it more fragile. 🙂

  13. I’m a little surprised there’s not been a blog post on the Californian electricity company,

    I’ve not heard anything about them!

  14. I wonder if the huge, new, shiny IT project is going to join the huge, new, shiny headquarters as a sure sign that the company concerned is about to go West?

  15. Horrible echoes of a GEC business unit in the 1990s: we were going to bring in Electronic Design Management. It was going to be awesome. We’d have all the drawings and design documents available on our desktops, would be able to do mark-up and editing and the changes would go through for approval automatically instead of requiring reams of paper and lots of irrelevant attention, this would transform the way we were going to do business.

    A few of us did ask how this would work in practice, given that we were struggling to get enough PCs for the technical staff to even do basic word processing and e-mail (at one point our request for four more PCs was met with the offer of… one second-hand machine with a 286 processor and no hard drive… that wasn’t good going for 1995) but we were told not to worry, it was all going to be fine.

    Of course it took far longer, cost far more and achieved far less than promised; the scanned drawings were just .TIF files of gigantic size (that took ages to get off the server and onto your desktop) and couldn’t be edited, or even viewed well on the standard 14″ 640 x 480 VGA monitor (remember those?). The design documents never did get scanned or brought into the system properly. The “approvals system” never got off the ground and everyone stuck to paper trails to prove they’d done their part and the delay wasn’t their fault.

    Five years later I was part of the implementation team for Earned Value Management, which was going to transform the way we did business, make us much more profitable, help us meet deadlines, show us where to strip away bureaucracy and nugatory effort, et cetera. We did some (pretty good, if I do say so myself) process mapping on “how our better projects were run and what our less good projects seemed to do wrong”, we were expensively trained on the software to implement it, it was actually looking as if it might achieve some of its goals… and then with a change of management the Very Senior Person whose pet idea it was moved on and their replacement binned the lot. It wouldn’t have worked as well as hoped (and we knew that!) but we’d tried to get the “stable intermediates” into the setup: so that if it fell short of perfection it would still be “better than the current mess of paper, MS Project and guesswork”.

    When you’re a one-man-band consultancy you make damn sure you find out what your customer needs and deliver it to them; when you’re a big business unit you’ve got a lot of places for the Bright Ideas Club to loiter.

    And from a systems engineer’s point of view, expect failure but build something that will still be useful if it drops short of expectations.

    The most useful stuff was often ad hoc and small scale, like Hywell’s improvised database: he’d been told to teach himself “how to make a database” with a spare copy of Lotus Symphony, so he’d used a stack of MOD Form 2022s (defect reports for when our torpedoes misbehaved) as his working material. That grew into a really useful tool to search for defects and problems, so when we did Sting Ray Life Extension we hammered that database for “which bits break most often?” so we could fix them properly. It was created by accident, grew into something useful because his boss made time and found budget to support it (and eventually made it Hywell’s main job to run and maintain that database) and get all the 2022s in there, and also because it grew organically (so, getting the key words and metadata right, so it could be properly indexed and searched, became blatantly obvious from the beginning as “if you don’t do this on your first draft database of just fifty items it’s no use” rather than “that’s so obvious that nobody thought of it until we’d entered thousands of forms and now it’s too late to go back and fix”.

    Nicholas Naseem Taleb is entertaining on stuff like this, and I agree with a lot of what he says (and when I don’t he’s interesting and thought-provoking). “Big Bang” solutions imposed from above rarely work as well as improvised fixes evolved from below…

  16. @Graeme on January 23, 2019 at 11:44 am

    Major appointing failure Kinnock as UK’s EU Commissioner was the point I went from “we should” to “we must” leave EU.

    It exemplified how undemocratic & totalitarian EU is. Also how in thrall Major was to EU & Socialism, not UK.

  17. @Tim Newman on January 23, 2019 at 1:32 pm

    +1 on cuck Secret Barrister

    @Tim Newman on January 23, 2019 at 5:45 pm

    PG& E I’ve not heard anything about them

    Relying on BBC News?

    Not searched, but try Breitbart, Spectator and Spiked

  18. @Jason Lynch on January 23, 2019 at 10:58 pm

    so he’d used a stack of MOD Form 2022s (defect reports for when our torpedoes misbehaved) as his working material. That grew into a really useful tool to search for defects and problems, so when we did Sting Ray Life Extension we hammered that database for “which bits break most often?” so we could fix them properly.

    That’s what good automotive reman firms do. A reman (not refurb/recon) frequently better – and cheaper – than OEM,

  19. Very true again. One thing misses is that organic improvement ideas when implemented without the bosses say so or support become pre-planned initiatives and therefore the bosses ideas if they work. My patch is now exactly that. Bitter? Moi?

  20. Good points in general, but I’m not sure Tesla/Musk is the best example. To him Tesla has always been intended to be a thing that helps him get “Humanity” to Mars (for better or for worse) rather than an end in of itself – he wouldn’t be happy running Tesla as it is today – a mere car company with a couple of expensive electric vehicles, he wants to get to a wide range of price points by aggressively pushing things forward whether it’s profitable or not to do so. Tesla (and to some extent SpaceX) is more of a religious crusade than a company really, and the Boring Company stuff isn’t out of character if you think of it like that. To date he has had some success in this, and I wish best of luck to him, but I wouldn’t say he’s an example of a CEO/company losing the plot; he never really had it to start with or at least he had a different plot in mind 😉

    I found this Wait But Why series to be instructive in deciphering some of Musk’s motivations for what he does, although it’s a little too fawning for my taste.

Comments are closed.