When One System Fails Another

Robinson Crusoe Shipwrecked

Ten days ago, when I wrote the post “Uber and the Cost of a Culture of Corruption”, I said that assuming there will be negative consequences (both legal and financial) from the incidents in the news, then it is in Uber’s best interests to fix the problem that led to them in the first place. The negative consequences are now becoming visible in the form of people abandoning ship.

Over the weekend, Uber’s president, Jeff Jones, resigned with the following statement:

I joined Uber because of its Mission, and the challenge to build global capabilities that would help the company mature and thrive long-term.

It is now clear, however, that the beliefs and approach to leadership that have guided my career are inconsistent with what I saw and experienced at Uber, and I can no longer continue as president of the ride sharing business.

There are thousands of amazing people at the company, and I truly wish everyone well.

Travis Kalanick’s announcement to Uber’s employees, while factually accurate (the decision did come after the announcement of the search for a COO), doesn’t quite convey Jones’ reasons for leaving:

Team,

I wanted to let you know that Jeff Jones has decided to resign from Uber.

Jeff joined Uber in October 2016 from being CMO at retailer Target. In 6 months, he made an important impact on the company—from his focus on being driver obsessed to delivering our first brand reputation study, which will help set our course in the coming months and year.

After we announced our intention to hire a COO, Jeff came to the tough decision that he doesn’t see his future at Uber. It is unfortunate that this was announced through the press but I thought it was important to send all of you an email before providing comment publicly.

Rachel, Pierre and Mac will continue to lead the Global Ops teams, reporting to me until we have signed a COO. Troy Stevenson, who leads CommOps, and Shalin Amin who leads brand design will report to Rachel Holt. Ab Gupta will report to Andrew MacDonald.

Thanks,

Travis

Jones is not the only Uber executive to resign this weekend. Brian McClendon, vice president in charge of Uber’s mapping, is “…leaving to return to his hometown in Kansas”.

These resignations are also not the only recent executive casualties. Ed Baker, vice president of product and growth, had also announced his departure earlier this month amid questions regarding his conduct with other Uber employees. This came after senior vice president of engineering Amit Singhal was asked to resign when it was discovered that he failed to disclose that he was investigated for sexual harassment while at Google.

It’s cliché to talk about people as assets, but for companies like Uber, their talent really does comprise the majority of their value. While the media will take note of high-profile departures like these, it would be a mistake to consider them the entirety of the damage. How many lesser known employees have left or will be leaving as a result of the recent scandals? How much potential talent will pass by opportunities at Uber due to what’s happened? In particular, how much harder will this make Kalanick’s search for a Chief Operating Officer who can turn things around?

If the talent drain is not quickly plugged, what happens to the quality of Uber’s service?

This situation perfectly illustrates the theme of organizations as systems. Uber’s software and business model have done well for it, but the culture created by the lack of leadership and lack of ethics of its management may well sink it. One bad component can bring down a system, whether software or social. The tragedy is that the innocent would be harmed along with the guilty.

Uber and the Cost of a Culture of Corruption

'Personification of the Faculty of Law' from the pedestal of the statue of Emperor Charles IV, Prague, Czech Republic - via Wikimedia Commons

Even before I hit the “Publish” button on Monday’s post, “Regulating Software Development”, I had already started composing this post in my head. In that post I had used the words “corrupt culture” in passing. I needed to expand on that, because I believe that’s what lies at the heart of Uber’s cascading collection of scandals.

Uber’s business model has always displayed a certain flexible attitude towards government regulation. Greyball represented a departure from dancing on the line to barging over it. Caught with their hand in the cookie jar, Uber has now announced “We are expressly prohibiting its use to target action by local regulators going forward”. I doubt this act of contrition on their part will be deemed sufficient.

In this environment, Susan Fowler’s account of her time at Uber becomes less of a “how could they be so stupid” story and more of a foregone conclusion. When, to all appearances, violating the law is part of your business model and you’re building software intended to thwart enforcement of the laws you’re violating, your moral authority is rather thin. In this type of culture, I’d imagine things like unwanted sexual advances and retaliation aren’t seen as a big deal, rather business as usual. Crossing lines, like other activities, becomes easier with practice.

Assuming that there will be negative consequences (both legal and financial), from these incidents, then it is in Uber’s best interests to fix the problem that led to them in the first place. This means radically changing Uber’s culture, otherwise new problems will continue to arise. Uber’s CEO has announced that the company is looking for leadership assistance:

“This morning I told the Uber team that we’re actively looking for a Chief Operating Officer: a peer who can partner with me to write the next chapter in our journey,” Kalanick said in a statement on Tuesday.

It remains to be seen whether this will represent a radical change in leadership or not. Anything less than a radical change will be unlikely to affect the current culture which appears to be a deeply entrenched. Debbie Madden, CEO of Stride, published an open letter to Uber’s Travis Kalanick on Wednesday. In “Dear Travis Kalanick: Here’s What You Must Demand From Uber’s New COO”, she noted that “Uber’s culture is broken and you need help to fix it”. She outlined seven steps to do just that:

Step 1: Change Uber’s core values

Step 2: Kill Greyball

Step 3: Adopt a zero-tolerance harassment policy and fire offenders

Step 4: Hire a strong head of HR and an employment lawyer and educate employees

Step 5: Fire or PIP each manager and HR employee who turned a blind eye

Step 6: Shift focus from individual productivity to team productivity

Step 7: Change your recruiting process

Uber isn’t the only organization in trouble due to a troubled culture. Volkswagen is in the same boat and it isn’t over yet. It’s reported that the pollution hidden by their cheating on emissions testing could contribute to the early death of 1,200 Europeans. It’s a solid bet that there will be more litigation to come.

Uber hasn’t killed anyone as a result of their corporate culture, but with their interest in self-driving vehicles, we should all be rooting for a turn-around in the ethics department. Uber can only exist in the future by eliminating the Uber of the past.

Fear of Failure, Fear and Failure

Capricho 43, Goya's 'The Sleep of Reason Produces Monsters'

Some things seem so logically inconsistent that you just have to check them out.

Such was the title of a post on LinkedIn that I saw the other day: “Innovation In Fear-Based Cultures? Or, why hire lions to be dogs?”. In it, Michael Graber noted that “…top-down organizations have the most trouble innovating.”:

In particular, the fearful mindsets that review, align, and sign off on “decks” to be presented to Vice President-level colleagues often edit out the insights and recommendations that have the power to grow the business in new ways.

These well-trained, obedient keepers of the status quo are rewarded for not taking risks and for not thinking outside of the existing paradigm of the business.

None of this is particularly shocking, a culture of fear is pretty much the antithesis of a learning culture and innovation in the absence of a learning culture is a bit like snow in the desert – not impossible, but certainly remarkable.

Learning involves risk. Whether the method is “move fast and break things” or something more deliberate and considered (such as that outlined in Greger Wikstrand‘s post “Jobs to be done innovation”), there is a risk of failure. Where there is a culture of fear, people will avoid all failure. Even limited risk failure in the context of an acknowledged experiment will be avoided because people won’t trust in the powers that be not to punish the failure. In avoiding this type of failure, learning that leads to innovation is avoided as well. You can still learn from what others have done (or failed to do), but even then there’s the problem of finding someone foolhardy enough to propose an action that’s out of the norm for the organization.

Why would an organization foster this kind of culture?

Seth Godin’s post, “What bureaucracy can’t do for you”, holds the key:

It lets us off the hook in many ways. It creates systems and momentum and eliminates many decisions for its members.

“I’m just doing my job.”

“That’s the way the system works.”

Decisions involve risk, someone could make the wrong one. For that reason, the number of people making decisions should be minimized (not a position I endorse, mind you).

That’s the irony of top-down, bureaucratic organizations – often the culture is by design, intended to eliminate risk. By succeeding in doing so on the mundane level, the organization actually introduces an existential risk, the risk of stagnation. The law of unintended consequences has a very long arm.

This type of culture actually introduces perverse incentives that further threaten the organization’s long-term health. Creativity is a huge risk, you could be wrong. Even if you’re right, you’ve become noticeable. Visibility becomes the same as risk. Likewise, responsibility means appearing on the radar. This not only discourages positive actions, but can easily be a corrupting influence.

Fear isn’t the only thing we have to fear, but sometimes it’s something we really need to be concerned about.


This post is another installment of an ongoing conversation about innovation with Greger Wikstrand.

Go-to People Considered Harmful

Neck of Codd bottle

Okay, so the title’s a little derivative, but it’s both accurate and it fits in with the “organizations as systems” theme of recent posts. Just as dependency management is important for software systems, it’s likewise just as critical for social systems. Failures anywhere along the chain of execution can potentially bring the whole system to a halt if resilience isn’t considered in the design (and evolution) of the system.

Dependency issues in social systems can take a variety of forms. One that comes easily to mind is what is referred to as the “bus factor” – how badly the team is affected if a person is lost (e.g. hit by a bus). Roy Osherove’s post from today, “A Critical Chain of Bus Factors”, expands on this. Interlocking chains of dependencies can multiply the bus factor:

A chain of bus factors happens when you have bus factors depending on bus factors:

Your one developer who knows how to configure the pipeline can’t test the changes because the agent is down. The one guy in IT who has access to the agent needs to reboot it, but does not have access. The one person who has access to reboot it (in the Infra team) is sick, so now there are three people waiting, and there is nothing in this earth that can help that situation.

The “bus factor”, either individually or as a cascading chain, is only part of the problem, however. A column on CIO.com, “The hazards of go-to people”, identifies the potential negative impacts on the go-to person:

They may:

  • Resent that they shoulder so much of the burden for the entire group.
  • Feel underpaid.
  • Burn out from the stress of being on the never-ending-crisis treadmill.
  • Feel trapped and unable to progress in their careers since they are so important in the role that they are in.
  • Become arrogant and condescending to their peers, drunk with the glory of being important.

The same column also lists potential problems for those who are not the go-to person:

When they realize that they are not one of the go-to people they might:

  • Feel underappreciated and untrusted.
  • Lose the desire to work hard since they don’t feel that their work will be recognized or rewarded.
  • Miss out on the opportunities to work on exciting or important things, since they are not considered dedicated and capable.
  • Feel underappreciated and untrusted.

A particularly nasty effect of relying on go-to people is that it’s self-reinforcing if not recognized and actively worked against. People get used to relying on the specialist (which is, admittedly, very effective right up until the bus arrives) and neglect learning to do for themselves. Osherove suggests several methods to mitigate these problems: pairing, teaching, rotating positions, etc. The key idea being, spreading the knowledge around.

Having individuals with deep knowledge can be a good thing if they’re a reservoir supplying others and not a pipeline constraining the flow. Intentional management of dependencies is just as important in social systems as in software systems.

Systems of Social Systems and the Software Systems They Create

I’ve mentioned before that the idea of looking at organizations as systems is one that I’ve been focusing on for quite a while now. From a top-down perspective, this makes sense – an organization is a system that works better when it’s component parts (both machine and human) intentionally work together.

It also works from the bottom up. For example, from a purely technical perspective, we have a system:

Generic System

However, without considering those who use the system, we have limited picture of the context the system operates within. The better we understand that context, the better we can shape the system to fit the context, otherwise we risk the square peg in a round hole situation:

Generic System with Users

Of course, the users who own the system are also only a part of the context. We have to consider the customers as well:

Generic System with Users and customers

Likewise, we need to consider that the customers of some systems can be internal to the organization while others are external. Some of the “customers” may not even be human. For that matter, sometimes the customer’s interface might be a human (user) rather than software. Things get complicated when we begin adding in the social systems:

Generic EITA with Users and customers

The situation is even more complicated than what’s seen above. We need to account for the team developing and operating the automated system:

Generic System with Users, customers, and IT team

And if that team is not a unified whole, then the picture gets a whole lot more interesting:

Generic System with Users, customers, and IT teams

Zoomed out to the enterprise level, that’s a lot of social systems. When multiplied by the number of automated systems involved, the number easily becomes staggering. What’s even more sobering is reflecting on whether those interactions have been intentionally structured or have grown organically over time. The interrelationship of social and software systems is under-appreciated. A series of tweets from Gregory Brown last week makes the same case:

A number of questions come to mind:

  • Is anyone aware of all the systems (social and software) in play?
  • Is anyone aware of all the interactions between these systems?
  • Are the relationships and interactions a result of intentional design or have they “just happened”?
  • Are you comfortable with the answers to the first three questions above?

Organizations as Systems and Innovation

Portrait of Gustavus Adolphus of Sweden

Over the last year or so, the concept of looking at organizations as systems has been a major theme for me. Enterprises, organizations and their ecosystems (context) are social systems composed of a fractal set of social and software systems. As such, enterprises have an architecture.

Another long-term theme for this site has been my conversation with Greger Wikstrand regarding innovation. This post is the thirty-fifth entry in that series.

So where do these two intersect? And why is there a picture of a Swedish king from four-hundred years ago up there?

Innovation, by its very nature (“…significant positive change”), does not happen in a vacuum. Greger’s last post, “Innovation arenas and outsourcing”, illustrates one aspect of this. Shepherding ideas into innovations is a deliberate activity requiring structural support. Being intentional doesn’t turn bad ideas into innovations, but lack of a system can cause an otherwise good idea to wither on the vine.

Another intersection, the one I’m focusing on here, can be found in the nature of innovation itself. It’s common to think of technological innovation, but innovation can also be found in changes to organizational structure and processes (e.g. Henry Ford and the assembly line). Organization, process, and technology are not only areas for innovation, but when coupled with people, form the primary elements of an enterprise architecture. It should be clear that the more these elements are intentionally coordinated towards a specific goal, the more cohesive the effort should be.

This brings us to Gustavus Adolphus of Sweden. In his twenty years on the throne, he converted Sweden into a major power in Europe. Militarily, he upended the European status quo in a very short time (after intervening in the Thirty Years’ War in 1630, he was killed in battle in 1632) by marshaling organizational, procedural, technological innovations:

The Swedish army stood apart from its’ contemporaries through five characteristics. Its’ soldiers wore uniform and had a nucleus of native Swedes, raised from a surprisingly diplomatic system of conscription, at its’ core. The Swedish regiments were small in comparison to their opponents and were lightly equipped for speed. Each regiment had its’ own light and mobile field artillery guns called ‘leathern guns’ that were easy to handle and could be easily manoeuvred to meet sudden changes on the battlefield. The muskets carried by these soldiers were of a type superior to that in general use and allowed for much faster rates of fire. Swedish cavalry, instead of galloping up to the enemy, discharging their pistols and then turning around and galloping back to reload, ruthlessly charged with close quarter weapons once their initial shot had been expended. By analysing this paradigm it becomes apparent that the army under Gustavus emphasized speed and manoeuvrability above all – this greatly set him apart from his opponents.

By themselves, none of the innovations were original to Gustavus. Combining them together, however, was and European military practice was irrevocably changed. Inflection points can be dependent on multiple technologies catching up with one another (since the future is “…not very evenly distributed”), but in this case the pieces were all in place. The catalyst was someone with the vision to combine them, not random chance.

Emergence will be a factor in any complex system. That being said, the inevitability of those emergent events does not invalidate intentional design and planning. If anything, design and planning is more necessary to deal with the mundane, foreseeable things in order to leave more cognitive capacity to deal with that which can’t be foreseen.

I fought the law (of unintended consequences) and the law won

Sometimes, what seemed to be a really good idea just doesn’t turn out that way in the end.

In my opinion, a lack of a systems approach to problem solving makes that type of outcome much more likely. Simplistic responses to issues that fail to deal with problems holistically can backfire. Such ill-considered solutions not only fail to solve the original problem, but often set up perverse incentives that can lead to new problems.

An article on the Daily WTF last week, “Just the fax, Ma’am”, illustrates this perfectly. In the article, an inflexible and time-consuming database change process (layered on top of the standard change management process) leads to the “reuse” of an existing, but obsolete field in the database. Using a field labeled “Fax” for an entirely different purpose is far from “best practice”, but following the rules would lead to being seen as responsible for delaying a release. This is an example of a moral hazard, such as Tom Cagley discussed in his post “Some Moral Hazards In Software Development”. Where the cost of taking a risk is not borne by the party deciding whether to take it, potential for abuse abounds. This risk becomes particularly likely when the person taking shortcuts can claim a “moral” rationale for doing so (such as “getting it done” for the customer).

None of this is to suggest that change management isn’t a worthy goal. In fact, the worthier the goal, the greater the danger of creating an unintended consequence because it’s so easy to conflate argument over means with disagreement regarding the ends. If you’re not in favor of being strip-searched on arrival and departure from work, that doesn’t mean you’re anti-security. Nonetheless, the danger of that accusation being made will likely resonate for many. When the worthiness of the goal forestalls, or even just hinders, examination of the effectiveness of methods, then that effectiveness is likely to suffer.

Over the course of 2016, I’ve published twenty-two posts, counting this one, with the category Organizations as Systems. The fact that social systems are less deterministic than software systems only reinforces the need for intentional design. When foreseeable abuses are not accounted for, their incidence becomes more likely. Whether the abuse results from personal pettiness, doctrinal disagreements, or even just clumsy design like the change management process described above is irrelevant. In all of those cases, the problem is the same, decreased respect for institutional norms. Studies have found that “…corruption corrupts”:

Gächter has long been interested in honesty and how it manifests around the world. In 2008, he showed that students from 16 cities, from Riyadh to Boston, varied in how likely they were to punish cheaters in their midst, and how likely those cheaters were to then retaliate against their castigators. Both qualities were related to the values of the respective cities. Gächter found that the students were more likely to tolerate free-loaders and retaliate against do-gooders if they came from places whose citizens took a more relaxed view on tax evasion or fare-dodging, or had less trust in their courts and police.

If opinions around corruption and rule of law can affect people’s reactions to dishonesty, Gächter reasoned that they surely affect how honest people are themselves. If celebrities cheat, politicians rig elections, and business leaders engage in nepotism, surely common citizens would feel more justified in cutting corners themselves.

Taking a relaxed attitude toward the design of a social system can result in its constituents taking a relaxed attitude toward those aspects of the system that are inconvenient to them.