[Script Info]
Title: 
[Events]
Format: Layer, Start, End, Style, Name, MarginL, MarginR, MarginV, Effect, Text
Dialogue: 0,0:00:00.74,0:00:02.74,Default,,0000,0000,0000,,I have spent the last years
Dialogue: 0,0:00:02.74,0:00:05.40,Default,,0000,0000,0000,,trying to resolve two enigmas:
Dialogue: 0,0:00:05.40,0:00:09.76,Default,,0000,0000,0000,,Why is productivity so disappointing
Dialogue: 0,0:00:09.76,0:00:11.64,Default,,0000,0000,0000,,in all the companies where I work?
Dialogue: 0,0:00:11.64,0:00:15.34,Default,,0000,0000,0000,,I have worked with more than 500 companies.
Dialogue: 0,0:00:15.34,0:00:17.78,Default,,0000,0000,0000,,Despite all the technological advances --
Dialogue: 0,0:00:17.78,0:00:21.07,Default,,0000,0000,0000,,computers, I.T., communications, telecommunications,
Dialogue: 0,0:00:21.07,0:00:23.43,Default,,0000,0000,0000,,the Internet.
Dialogue: 0,0:00:23.43,0:00:24.83,Default,,0000,0000,0000,,Enigma number two:
Dialogue: 0,0:00:24.83,0:00:27.86,Default,,0000,0000,0000,,Why is there so little engagement at work?
Dialogue: 0,0:00:27.86,0:00:29.97,Default,,0000,0000,0000,,Why do people feel so miserable,
Dialogue: 0,0:00:29.97,0:00:33.62,Default,,0000,0000,0000,,even actively disengaged?
Dialogue: 0,0:00:33.62,0:00:35.14,Default,,0000,0000,0000,,Disengaging their colleagues.
Dialogue: 0,0:00:35.14,0:00:39.87,Default,,0000,0000,0000,,Acting against the interest of their company.
Dialogue: 0,0:00:39.87,0:00:43.98,Default,,0000,0000,0000,,Despite all the affiliation events,
Dialogue: 0,0:00:43.98,0:00:47.97,Default,,0000,0000,0000,,the celebration, the people initiatives,
Dialogue: 0,0:00:47.97,0:00:50.57,Default,,0000,0000,0000,,the leadership development programs to train
Dialogue: 0,0:00:50.57,0:00:54.96,Default,,0000,0000,0000,,managers on how to better motivate their teams.
Dialogue: 0,0:00:54.96,0:00:56.69,Default,,0000,0000,0000,,At the beginning, I thought there was
Dialogue: 0,0:00:56.69,0:00:58.66,Default,,0000,0000,0000,,a chicken and egg issue:
Dialogue: 0,0:00:58.66,0:01:01.22,Default,,0000,0000,0000,,Because people are less engaged, \Nthey are less productive.
Dialogue: 0,0:01:01.22,0:01:03.45,Default,,0000,0000,0000,,Or vice versa, because they are less productive,
Dialogue: 0,0:01:03.45,0:01:05.64,Default,,0000,0000,0000,,we put more pressure and they are less engaged.
Dialogue: 0,0:01:05.64,0:01:07.51,Default,,0000,0000,0000,,But as we were doing our analysis
Dialogue: 0,0:01:07.51,0:01:09.43,Default,,0000,0000,0000,,we realized that there was a common root cause
Dialogue: 0,0:01:09.43,0:01:10.82,Default,,0000,0000,0000,,to these two issues
Dialogue: 0,0:01:10.82,0:01:15.37,Default,,0000,0000,0000,,that relates, in fact, to the basic \Npillars of management.
Dialogue: 0,0:01:15.37,0:01:18.54,Default,,0000,0000,0000,,The way we organize is based on two pillars.
Dialogue: 0,0:01:18.54,0:01:21.29,Default,,0000,0000,0000,,The hard -- structure, processes, systems.
Dialogue: 0,0:01:21.29,0:01:22.52,Default,,0000,0000,0000,,The soft --
Dialogue: 0,0:01:22.52,0:01:27.97,Default,,0000,0000,0000,,feelings, sentiments, interpersonal\Nrelationships, traits, personality.
Dialogue: 0,0:01:27.97,0:01:29.44,Default,,0000,0000,0000,,And whenever a company
Dialogue: 0,0:01:29.44,0:01:33.16,Default,,0000,0000,0000,,reorganizes, restructures, reengineers,
Dialogue: 0,0:01:33.16,0:01:35.60,Default,,0000,0000,0000,,goes through a cultural transformation program,
Dialogue: 0,0:01:35.60,0:01:37.63,Default,,0000,0000,0000,,it chooses these two pillars.
Dialogue: 0,0:01:37.63,0:01:39.68,Default,,0000,0000,0000,,Now, we try to refine them,
Dialogue: 0,0:01:39.68,0:01:41.58,Default,,0000,0000,0000,,we try to combine them.
Dialogue: 0,0:01:41.58,0:01:43.21,Default,,0000,0000,0000,,The real issue is --
Dialogue: 0,0:01:43.21,0:01:45.24,Default,,0000,0000,0000,,and this is the answer to the two enigmas --
Dialogue: 0,0:01:45.24,0:01:48.18,Default,,0000,0000,0000,,these pillars are obsolete.
Dialogue: 0,0:01:48.18,0:01:50.86,Default,,0000,0000,0000,,Everything you read in business books is based
Dialogue: 0,0:01:50.86,0:01:52.52,Default,,0000,0000,0000,,either on one or the other
Dialogue: 0,0:01:52.52,0:01:53.79,Default,,0000,0000,0000,,or their combination.
Dialogue: 0,0:01:53.79,0:01:55.10,Default,,0000,0000,0000,,They are obsolete.
Dialogue: 0,0:01:55.10,0:01:57.40,Default,,0000,0000,0000,,How do they work
Dialogue: 0,0:01:57.40,0:01:59.69,Default,,0000,0000,0000,,when you try to use these approaches
Dialogue: 0,0:01:59.69,0:02:01.84,Default,,0000,0000,0000,,in front of the new complexity of business?
Dialogue: 0,0:02:01.84,0:02:04.83,Default,,0000,0000,0000,,The hard approach, basically \Nis that you start from strategy,
Dialogue: 0,0:02:04.83,0:02:08.46,Default,,0000,0000,0000,,requirements, structures, processes, \Nsystems, KPIs, scorecards,
Dialogue: 0,0:02:08.46,0:02:11.34,Default,,0000,0000,0000,,committees, headquarters, hubs, clusters,
Dialogue: 0,0:02:11.34,0:02:12.45,Default,,0000,0000,0000,,you name it.
Dialogue: 0,0:02:12.45,0:02:17.88,Default,,0000,0000,0000,,I forgot all the metrics, incentives, committees, \Nmiddle offices and interfaces.
Dialogue: 0,0:02:17.88,0:02:19.88,Default,,0000,0000,0000,,What happens basically on the left,
Dialogue: 0,0:02:19.88,0:02:23.14,Default,,0000,0000,0000,,you have more complexity, the \Nnew complexity of business.
Dialogue: 0,0:02:23.14,0:02:27.43,Default,,0000,0000,0000,,We need quality, cost, reliability, speed.
Dialogue: 0,0:02:27.43,0:02:29.81,Default,,0000,0000,0000,,And every time there is a new requirement,
Dialogue: 0,0:02:29.81,0:02:31.29,Default,,0000,0000,0000,,we use the same approach.
Dialogue: 0,0:02:31.29,0:02:34.40,Default,,0000,0000,0000,,We create dedicated structure processed systems,
Dialogue: 0,0:02:34.40,0:02:37.64,Default,,0000,0000,0000,,basically to deal with the \Nnew complexity of business.
Dialogue: 0,0:02:37.64,0:02:41.38,Default,,0000,0000,0000,,The hard approach creates just complicatedness
Dialogue: 0,0:02:41.38,0:02:43.22,Default,,0000,0000,0000,,in the organization.
Dialogue: 0,0:02:43.22,0:02:44.80,Default,,0000,0000,0000,,Let's take an example.
Dialogue: 0,0:02:44.80,0:02:47.69,Default,,0000,0000,0000,,An automotive company, the engineering division
Dialogue: 0,0:02:47.69,0:02:49.49,Default,,0000,0000,0000,,is a five-dimensional matrix.
Dialogue: 0,0:02:49.49,0:02:51.52,Default,,0000,0000,0000,,If you open any cell of the matrix,
Dialogue: 0,0:02:51.52,0:02:54.53,Default,,0000,0000,0000,,you find another 20-dimensional matrix.
Dialogue: 0,0:02:54.53,0:02:57.39,Default,,0000,0000,0000,,You have Mr. Noise, Mr. Petrol Consumption,
Dialogue: 0,0:02:57.39,0:02:59.35,Default,,0000,0000,0000,,Mr. Anti-Collision Properties.
Dialogue: 0,0:02:59.35,0:03:01.18,Default,,0000,0000,0000,,For any new requirement,
Dialogue: 0,0:03:01.18,0:03:03.06,Default,,0000,0000,0000,,you have a dedicated function
Dialogue: 0,0:03:03.06,0:03:05.85,Default,,0000,0000,0000,,in charge of aligning engineers against
Dialogue: 0,0:03:05.85,0:03:07.39,Default,,0000,0000,0000,,the new requirement.
Dialogue: 0,0:03:07.39,0:03:09.99,Default,,0000,0000,0000,,What happens when the new \Nrequirement emerges?
Dialogue: 0,0:03:09.99,0:03:12.08,Default,,0000,0000,0000,,Some years ago, a new requirement
Dialogue: 0,0:03:12.08,0:03:13.93,Default,,0000,0000,0000,,appeared on the marketplace:
Dialogue: 0,0:03:13.93,0:03:16.08,Default,,0000,0000,0000,,the length of the warranty period.
Dialogue: 0,0:03:16.08,0:03:19.02,Default,,0000,0000,0000,,So therefore the new requirement is repairability,
Dialogue: 0,0:03:19.02,0:03:20.52,Default,,0000,0000,0000,,making cars easy to repair.
Dialogue: 0,0:03:20.52,0:03:24.52,Default,,0000,0000,0000,,Otherwise when you bring the car \Nto the garage to fix the light,
Dialogue: 0,0:03:24.52,0:03:26.78,Default,,0000,0000,0000,,if you have to remove the engine
Dialogue: 0,0:03:26.78,0:03:28.11,Default,,0000,0000,0000,,to access the lights,
Dialogue: 0,0:03:28.11,0:03:30.55,Default,,0000,0000,0000,,the car will have to stay one week in the garage
Dialogue: 0,0:03:30.55,0:03:33.44,Default,,0000,0000,0000,,instead of two hours, and the \Nwarranty budget will explode.
Dialogue: 0,0:03:33.44,0:03:36.38,Default,,0000,0000,0000,,So, what was the solution using the hard approach?
Dialogue: 0,0:03:36.38,0:03:39.43,Default,,0000,0000,0000,,If repairability is the new requirement,
Dialogue: 0,0:03:39.43,0:03:41.52,Default,,0000,0000,0000,,the solution is to create a new function,
Dialogue: 0,0:03:41.52,0:03:43.69,Default,,0000,0000,0000,,Mr. Repairability.
Dialogue: 0,0:03:43.69,0:03:47.64,Default,,0000,0000,0000,,And Mr. Repairability creates \Nthe repairability process.
Dialogue: 0,0:03:47.64,0:03:51.49,Default,,0000,0000,0000,,With a repairability scorecard, \Nwith a repairability metric
Dialogue: 0,0:03:51.49,0:03:54.31,Default,,0000,0000,0000,,and eventually repairability incentive.
Dialogue: 0,0:03:54.31,0:03:58.07,Default,,0000,0000,0000,,That came on top of 25 other KPIs.
Dialogue: 0,0:03:58.07,0:04:01.58,Default,,0000,0000,0000,,What percentage of these people is variable compensation?
Dialogue: 0,0:04:01.58,0:04:05.40,Default,,0000,0000,0000,,Twenty percent at most, divided by 26 KPIs,
Dialogue: 0,0:04:05.40,0:04:09.50,Default,,0000,0000,0000,,repairability makes a difference of 0.8 percent.
Dialogue: 0,0:04:09.50,0:04:11.56,Default,,0000,0000,0000,,What difference did it make in their actions,
Dialogue: 0,0:04:11.56,0:04:14.18,Default,,0000,0000,0000,,their choices to simplify? Zero.
Dialogue: 0,0:04:14.18,0:04:17.85,Default,,0000,0000,0000,,But what occurs for zero impact? \NMr. Repairability, process,
Dialogue: 0,0:04:17.85,0:04:22.52,Default,,0000,0000,0000,,scorecard, evaluation, coordination \Nwith the 25 other coordinators
Dialogue: 0,0:04:22.52,0:04:24.42,Default,,0000,0000,0000,,to have zero impact.
Dialogue: 0,0:04:24.42,0:04:26.96,Default,,0000,0000,0000,,Now, in front of the new complexity of business,
Dialogue: 0,0:04:26.96,0:04:29.90,Default,,0000,0000,0000,,the only solution is not drawing boxes
Dialogue: 0,0:04:29.90,0:04:32.32,Default,,0000,0000,0000,,with reporting lines.
Dialogue: 0,0:04:32.32,0:04:35.41,Default,,0000,0000,0000,,It is basically the interplay.
Dialogue: 0,0:04:35.41,0:04:37.98,Default,,0000,0000,0000,,How the parts work together.
Dialogue: 0,0:04:37.98,0:04:42.71,Default,,0000,0000,0000,,The connections, the interactions, the synapses.
Dialogue: 0,0:04:42.71,0:04:47.21,Default,,0000,0000,0000,,It is not the skeleton of boxes, \Nit is the nervous system
Dialogue: 0,0:04:47.21,0:04:50.25,Default,,0000,0000,0000,,of adaptiveness and intelligence.
Dialogue: 0,0:04:50.25,0:04:53.15,Default,,0000,0000,0000,,You know, you could call it cooperation, basically.
Dialogue: 0,0:04:53.15,0:04:55.69,Default,,0000,0000,0000,,Whenever people cooperate,
Dialogue: 0,0:04:55.69,0:04:59.62,Default,,0000,0000,0000,,they use less resources. In everything.
Dialogue: 0,0:04:59.62,0:05:02.15,Default,,0000,0000,0000,,You know, the repairability issue
Dialogue: 0,0:05:02.15,0:05:04.90,Default,,0000,0000,0000,,is a cooperation problem.
Dialogue: 0,0:05:04.90,0:05:08.12,Default,,0000,0000,0000,,When you design cars, please take into account
Dialogue: 0,0:05:08.12,0:05:10.83,Default,,0000,0000,0000,,the needs of those who will repair the cars
Dialogue: 0,0:05:10.83,0:05:13.94,Default,,0000,0000,0000,,in the after sales garages.
Dialogue: 0,0:05:13.94,0:05:16.55,Default,,0000,0000,0000,,When we don't cooperate we need more time,
Dialogue: 0,0:05:16.55,0:05:20.34,Default,,0000,0000,0000,,more equipment, more systems, more teams.
Dialogue: 0,0:05:20.34,0:05:25.43,Default,,0000,0000,0000,,We need -- When procurement, supply \Nchain, manufacturing don't cooperate
Dialogue: 0,0:05:25.43,0:05:28.20,Default,,0000,0000,0000,,we need more stock, more inventories, \Nmore working capital.
Dialogue: 0,0:05:28.20,0:05:30.15,Default,,0000,0000,0000,,Who will pay for that?
Dialogue: 0,0:05:30.15,0:05:32.11,Default,,0000,0000,0000,,Shareholders? Customers?
Dialogue: 0,0:05:32.11,0:05:33.44,Default,,0000,0000,0000,,No, they will refuse.
Dialogue: 0,0:05:33.44,0:05:36.25,Default,,0000,0000,0000,,So who is left? \NThe employees,
Dialogue: 0,0:05:36.25,0:05:38.96,Default,,0000,0000,0000,,who have to compensate through their super
Dialogue: 0,0:05:38.96,0:05:42.28,Default,,0000,0000,0000,,individual efforts for the lack of cooperation.
Dialogue: 0,0:05:42.28,0:05:45.94,Default,,0000,0000,0000,,Stress, burnout, they are \Noverwhelmed, accidents.
Dialogue: 0,0:05:45.94,0:05:48.77,Default,,0000,0000,0000,,No wonder they disengage.
Dialogue: 0,0:05:48.77,0:05:52.56,Default,,0000,0000,0000,,How do the hard and the soft\Ntry to foster cooperation?
Dialogue: 0,0:05:52.56,0:05:57.20,Default,,0000,0000,0000,,The hard: In banks, when there is a problem
Dialogue: 0,0:05:57.20,0:06:00.26,Default,,0000,0000,0000,,between the back office and the front office,
Dialogue: 0,0:06:00.26,0:06:02.34,Default,,0000,0000,0000,,they don't cooperate. What is the solution?
Dialogue: 0,0:06:02.34,0:06:05.44,Default,,0000,0000,0000,,They create a middle office.
Dialogue: 0,0:06:05.44,0:06:07.48,Default,,0000,0000,0000,,What happens one year later?
Dialogue: 0,0:06:07.48,0:06:09.48,Default,,0000,0000,0000,,Instead of one problem \Nbetween the back and the front,
Dialogue: 0,0:06:09.48,0:06:10.84,Default,,0000,0000,0000,,now I have two problems.
Dialogue: 0,0:06:10.84,0:06:11.96,Default,,0000,0000,0000,,Between the back and the middle
Dialogue: 0,0:06:11.96,0:06:14.18,Default,,0000,0000,0000,,and between the middle and the front.
Dialogue: 0,0:06:14.18,0:06:16.64,Default,,0000,0000,0000,,Plus I have to pay for the middle office.
Dialogue: 0,0:06:16.64,0:06:19.90,Default,,0000,0000,0000,,The hard approach is unable to foster cooperation.
Dialogue: 0,0:06:19.90,0:06:24.34,Default,,0000,0000,0000,,It can only add new boxes, \Nnew bones in the skeleton.
Dialogue: 0,0:06:24.34,0:06:25.97,Default,,0000,0000,0000,,The soft approach:
Dialogue: 0,0:06:25.97,0:06:29.80,Default,,0000,0000,0000,,To make people cooperate, we need \Nto make them like each other.
Dialogue: 0,0:06:29.80,0:06:31.49,Default,,0000,0000,0000,,Improve interpersonal feelings,
Dialogue: 0,0:06:31.49,0:06:34.45,Default,,0000,0000,0000,,the more people like each other, \Nthe more they will cooperate.
Dialogue: 0,0:06:34.45,0:06:36.22,Default,,0000,0000,0000,,It is totally wrong.
Dialogue: 0,0:06:36.22,0:06:38.62,Default,,0000,0000,0000,,It is even counterproductive.
Dialogue: 0,0:06:38.62,0:06:41.04,Default,,0000,0000,0000,,Look, at home I have two TVs. Why?
Dialogue: 0,0:06:41.04,0:06:43.91,Default,,0000,0000,0000,,Precisely not to have to cooperate with my wife.
Dialogue: 0,0:06:43.91,0:06:45.55,Default,,0000,0000,0000,,(Laughter)
Dialogue: 0,0:06:45.55,0:06:48.45,Default,,0000,0000,0000,,Not to have to impose tradeoffs to my wife.
Dialogue: 0,0:06:48.45,0:06:52.46,Default,,0000,0000,0000,,And why I try not to impose tradeoffs to my wife
Dialogue: 0,0:06:52.46,0:06:55.13,Default,,0000,0000,0000,,is precisely because I love my wife.
Dialogue: 0,0:06:55.13,0:06:58.36,Default,,0000,0000,0000,,If I didn't love my wife, one TV would be enough:
Dialogue: 0,0:06:58.36,0:07:00.85,Default,,0000,0000,0000,,You will watch my favorite football game,
Dialogue: 0,0:07:00.85,0:07:03.40,Default,,0000,0000,0000,,if you are not happy, how is the book or the door?
Dialogue: 0,0:07:03.40,0:07:04.61,Default,,0000,0000,0000,,(Laughter)
Dialogue: 0,0:07:04.61,0:07:06.49,Default,,0000,0000,0000,,The more we like each other,
Dialogue: 0,0:07:06.49,0:07:09.10,Default,,0000,0000,0000,,the more we avoid the real cooperation
Dialogue: 0,0:07:09.10,0:07:13.28,Default,,0000,0000,0000,,that would strain our relationships \Nby imposing tough tradeoffs.
Dialogue: 0,0:07:13.28,0:07:16.28,Default,,0000,0000,0000,,And we go for a second TV or we escalate
Dialogue: 0,0:07:16.28,0:07:19.21,Default,,0000,0000,0000,,the decision above for arbitration.
Dialogue: 0,0:07:19.21,0:07:23.92,Default,,0000,0000,0000,,Definitely, these approaches are obsolete.
Dialogue: 0,0:07:23.92,0:07:27.70,Default,,0000,0000,0000,,To deal with complexity, to enhance the nervous system,
Dialogue: 0,0:07:27.70,0:07:30.96,Default,,0000,0000,0000,,we have created what we call \Nthe smart simplicity approach
Dialogue: 0,0:07:30.96,0:07:32.48,Default,,0000,0000,0000,,based on simple rules.
Dialogue: 0,0:07:32.48,0:07:34.74,Default,,0000,0000,0000,,Simple rule number one:
Dialogue: 0,0:07:34.74,0:07:37.77,Default,,0000,0000,0000,,Understand what others do.
Dialogue: 0,0:07:37.77,0:07:39.66,Default,,0000,0000,0000,,What is their real work?
Dialogue: 0,0:07:39.66,0:07:43.30,Default,,0000,0000,0000,,We need to go beyond the boxes,
Dialogue: 0,0:07:43.30,0:07:47.32,Default,,0000,0000,0000,,the job descriptions, beyond the surface
Dialogue: 0,0:07:47.32,0:07:50.82,Default,,0000,0000,0000,,of the container, to understand the real content.
Dialogue: 0,0:07:50.82,0:07:53.53,Default,,0000,0000,0000,,Me, designer, if I put a wire here,
Dialogue: 0,0:07:53.53,0:07:55.53,Default,,0000,0000,0000,,I know that it will mean that we will have to
Dialogue: 0,0:07:55.53,0:07:58.10,Default,,0000,0000,0000,,remove the engine to access the lights.
Dialogue: 0,0:07:58.10,0:08:00.95,Default,,0000,0000,0000,,Second, you need to reenforce integrators.
Dialogue: 0,0:08:00.95,0:08:04.81,Default,,0000,0000,0000,,Integrators are not middle \Noffices, they are managers,
Dialogue: 0,0:08:04.81,0:08:06.57,Default,,0000,0000,0000,,existing managers that you reinforce
Dialogue: 0,0:08:06.57,0:08:09.00,Default,,0000,0000,0000,,so that they have power and interest
Dialogue: 0,0:08:09.00,0:08:11.17,Default,,0000,0000,0000,,to make others cooperate.
Dialogue: 0,0:08:11.17,0:08:14.90,Default,,0000,0000,0000,,How can you reinforce your \Nmanagers as integrators?
Dialogue: 0,0:08:14.90,0:08:16.37,Default,,0000,0000,0000,,By removing layers.
Dialogue: 0,0:08:16.37,0:08:17.74,Default,,0000,0000,0000,,When there are too many layers
Dialogue: 0,0:08:17.74,0:08:19.29,Default,,0000,0000,0000,,people are too far from the action,
Dialogue: 0,0:08:19.29,0:08:21.40,Default,,0000,0000,0000,,therefore they need KPIs, metrics,
Dialogue: 0,0:08:21.40,0:08:25.73,Default,,0000,0000,0000,,they need poor proxies for reality.
Dialogue: 0,0:08:25.73,0:08:27.33,Default,,0000,0000,0000,,They don't understand reality
Dialogue: 0,0:08:27.33,0:08:30.43,Default,,0000,0000,0000,,and they add the complicatedness of metrics, KPIs.
Dialogue: 0,0:08:30.43,0:08:32.88,Default,,0000,0000,0000,,By removing rules -- the bigger we are,
Dialogue: 0,0:08:32.88,0:08:34.52,Default,,0000,0000,0000,,the more we need integrators,
Dialogue: 0,0:08:34.52,0:08:36.84,Default,,0000,0000,0000,,therefore the less rules we must have,
Dialogue: 0,0:08:36.84,0:08:40.73,Default,,0000,0000,0000,,to give discretionary power to managers.
Dialogue: 0,0:08:40.73,0:08:41.86,Default,,0000,0000,0000,,And we do the opposite --
Dialogue: 0,0:08:41.86,0:08:44.04,Default,,0000,0000,0000,,the bigger we are, the more rules we create.
Dialogue: 0,0:08:44.04,0:08:47.29,Default,,0000,0000,0000,,And we end up with the Encyclopedia \NBritannica of rules.
Dialogue: 0,0:08:47.29,0:08:49.39,Default,,0000,0000,0000,,You need to increase the quanitity of power
Dialogue: 0,0:08:49.39,0:08:51.12,Default,,0000,0000,0000,,so that you can empower everybody
Dialogue: 0,0:08:51.12,0:08:54.11,Default,,0000,0000,0000,,to use their judgment, their intelligence.
Dialogue: 0,0:08:54.11,0:08:56.26,Default,,0000,0000,0000,,You must give more cards to people
Dialogue: 0,0:08:56.26,0:08:59.62,Default,,0000,0000,0000,,so that they have the critical mass of cards
Dialogue: 0,0:08:59.62,0:09:01.58,Default,,0000,0000,0000,,to take the risk to cooperate,
Dialogue: 0,0:09:01.58,0:09:03.33,Default,,0000,0000,0000,,to move out of insulation.
Dialogue: 0,0:09:03.33,0:09:05.69,Default,,0000,0000,0000,,Otherwise, they will withdraw. They will disengage.
Dialogue: 0,0:09:05.69,0:09:07.94,Default,,0000,0000,0000,,These rules, they come from game theory
Dialogue: 0,0:09:07.94,0:09:10.17,Default,,0000,0000,0000,,and organizational sociology.
Dialogue: 0,0:09:10.17,0:09:13.02,Default,,0000,0000,0000,,You can increase the shadow of the future.
Dialogue: 0,0:09:13.02,0:09:15.92,Default,,0000,0000,0000,,Create feedback loops that expose people
Dialogue: 0,0:09:15.92,0:09:18.52,Default,,0000,0000,0000,,to the consequences of their actions.
Dialogue: 0,0:09:18.52,0:09:20.47,Default,,0000,0000,0000,,This is what the automotive company did
Dialogue: 0,0:09:20.47,0:09:23.26,Default,,0000,0000,0000,,when they saw that Mr. Repairability had no impact.
Dialogue: 0,0:09:23.26,0:09:24.89,Default,,0000,0000,0000,,They said to the design engineers:
Dialogue: 0,0:09:24.89,0:09:29.59,Default,,0000,0000,0000,,Now, in three years, when the new \Ncar is launched on the market,
Dialogue: 0,0:09:29.59,0:09:32.53,Default,,0000,0000,0000,,you will move to the after sales \Nnetwork, and become in charge
Dialogue: 0,0:09:32.53,0:09:34.90,Default,,0000,0000,0000,,of the warranty budget,
Dialogue: 0,0:09:34.90,0:09:38.28,Default,,0000,0000,0000,,and if the warranty budget explodes,
Dialogue: 0,0:09:38.28,0:09:40.95,Default,,0000,0000,0000,,it will explode in your face. (Laughter)
Dialogue: 0,0:09:40.95,0:09:46.89,Default,,0000,0000,0000,,Much more powerful than 0.8 \Npercent variable compensation.
Dialogue: 0,0:09:46.89,0:09:50.61,Default,,0000,0000,0000,,You need also to increase reciprocity,
Dialogue: 0,0:09:50.61,0:09:54.33,Default,,0000,0000,0000,,by removing the buffers that make us self-sufficient.
Dialogue: 0,0:09:54.33,0:09:56.80,Default,,0000,0000,0000,,When you remove these buffers,
Dialogue: 0,0:09:56.80,0:09:59.80,Default,,0000,0000,0000,,you hold me by the nose, I hold you by the ear.
Dialogue: 0,0:09:59.80,0:10:01.18,Default,,0000,0000,0000,,We will cooperate.
Dialogue: 0,0:10:01.18,0:10:02.72,Default,,0000,0000,0000,,Remove the second TV.
Dialogue: 0,0:10:02.72,0:10:04.96,Default,,0000,0000,0000,,There are many second TVs at work
Dialogue: 0,0:10:04.96,0:10:06.26,Default,,0000,0000,0000,,that don't create value,
Dialogue: 0,0:10:06.26,0:10:10.95,Default,,0000,0000,0000,,they just provide dysfunctional self-sufficiency.
Dialogue: 0,0:10:10.95,0:10:13.38,Default,,0000,0000,0000,,You need to reward those who cooperate
Dialogue: 0,0:10:13.38,0:10:15.06,Default,,0000,0000,0000,,and blame those who don't cooperate.
Dialogue: 0,0:10:15.06,0:10:18.13,Default,,0000,0000,0000,,The CEO of The Lego Group,
Dialogue: 0,0:10:18.13,0:10:20.95,Default,,0000,0000,0000,,Jorgen Vig Knudstorp, has a great way to use it.
Dialogue: 0,0:10:20.95,0:10:23.86,Default,,0000,0000,0000,,He says, blame is not for failure,
Dialogue: 0,0:10:23.86,0:10:28.39,Default,,0000,0000,0000,,it is for failing to help or ask for help.
Dialogue: 0,0:10:28.39,0:10:30.77,Default,,0000,0000,0000,,It changes everything.
Dialogue: 0,0:10:30.77,0:10:33.29,Default,,0000,0000,0000,,Suddenly it becomes in my\Ninterest to be transparent
Dialogue: 0,0:10:33.29,0:10:35.33,Default,,0000,0000,0000,,on my real weaknesses, my real forecast,
Dialogue: 0,0:10:35.33,0:10:37.42,Default,,0000,0000,0000,,because I know I will not be blamed if I fail,
Dialogue: 0,0:10:37.42,0:10:41.29,Default,,0000,0000,0000,,but if I fail to help or ask for help.
Dialogue: 0,0:10:41.29,0:10:44.21,Default,,0000,0000,0000,,When you do this, it has a lot of implications
Dialogue: 0,0:10:44.21,0:10:47.16,Default,,0000,0000,0000,,on organizational design.
Dialogue: 0,0:10:47.16,0:10:49.58,Default,,0000,0000,0000,,You stop drawing boxes, dotted lines, full lines;
Dialogue: 0,0:10:49.58,0:10:50.97,Default,,0000,0000,0000,,you look at their interplay.
Dialogue: 0,0:10:50.97,0:10:53.94,Default,,0000,0000,0000,,It has a lot of implications on financial policies
Dialogue: 0,0:10:53.94,0:10:55.16,Default,,0000,0000,0000,,that we use.
Dialogue: 0,0:10:55.16,0:10:57.78,Default,,0000,0000,0000,,On human resource management practices.
Dialogue: 0,0:10:57.78,0:11:00.20,Default,,0000,0000,0000,,When you do that, you can manage complexity,
Dialogue: 0,0:11:00.20,0:11:01.80,Default,,0000,0000,0000,,the new complexity of business,
Dialogue: 0,0:11:01.80,0:11:04.73,Default,,0000,0000,0000,,without getting complicated.
Dialogue: 0,0:11:04.73,0:11:08.38,Default,,0000,0000,0000,,You create more value with lower cost.
Dialogue: 0,0:11:08.38,0:11:12.96,Default,,0000,0000,0000,,You simultaneously improve \Nperformance and satisfaction at work
Dialogue: 0,0:11:12.96,0:11:15.68,Default,,0000,0000,0000,,because you have removed the common root cause
Dialogue: 0,0:11:15.68,0:11:17.30,Default,,0000,0000,0000,,that hinders both.
Dialogue: 0,0:11:17.30,0:11:22.01,Default,,0000,0000,0000,,Complicatedness: This is your \Nbattle, business leaders.
Dialogue: 0,0:11:22.01,0:11:24.84,Default,,0000,0000,0000,,The real battle is not against competitors.
Dialogue: 0,0:11:24.84,0:11:27.26,Default,,0000,0000,0000,,This is rubbish, very abstract.
Dialogue: 0,0:11:27.26,0:11:29.92,Default,,0000,0000,0000,,When do we meet competitors to fight them?
Dialogue: 0,0:11:29.92,0:11:32.82,Default,,0000,0000,0000,,The real battle is against ourselves,
Dialogue: 0,0:11:32.82,0:11:36.18,Default,,0000,0000,0000,,against our bureaucracy, our complicatedness.
Dialogue: 0,0:11:36.18,0:11:39.33,Default,,0000,0000,0000,,Only you can fight, can do it.
Dialogue: 0,0:11:39.33,0:11:41.42,Default,,0000,0000,0000,,Thank you.
Dialogue: 0,0:11:41.42,0:11:44.11,Default,,0000,0000,0000,,(Applause)