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Leading and Lagging Indicators

My friend Lane Arthur used to say, “Rain is a lagging indicator.”  We measure the rain as an output of a complex atmospheric system with many inputs. 

Yet rain is a leading indicator for a farmer, or a whitewater kayaker seeking a bigger thrill.

Every system is perfectly designed to produce the results it generates.  Leaders and managers, being in the system improvement business, need to think clearly about leading and lagging indicators.

We can draw it this way:

Where to find leading and lagging indicators

Indicators are oriented before or after the critical step/event.   All indicators have some value; leading indicators are more valuable than lagging indicators for improving system performance.  It takes skill and ingenuity to create valuable leading indicators because they are rarely obvious.  Tap into multiple perspectives to identify candidate indicators.

Lagging indicators often become the leading indicator for the next interaction of a system, or a separate system. 

Be smart about indicators to ratchet up your leadership effectiveness.

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Six Helps for When You’re Criticized

“Criticism is something we can easily avoid by saying nothing, doing nothing, and being nothing.” (Aristotle)

All leaders are criticized.  Everyone who holds a firm view will be criticized.  For most of us this reality is no fun. 

A few helps:

Accept that being criticized is part of the package deal for leadership.  You have a set of responsibilities, significant privileges, and will receive criticism.  You don’t get to opt out of part of the package and keep the rest.

Distinguish between criticism based on misunderstanding and misinformation from criticism based on what you truly decided, said, and did.  As best you’re able, when there is a hope of corrected information being meaningful to others, gently provide correct information.  Avoid “throwing pearls before swine.”  Where criticism is a difference of opinion about what should have been decided/said/did, weigh it carefully to see what lessons are to be learned.  Stand firm if you remain convicted;  plan to behave differently in the future if that’s appropriate. 

Remember the limitations of your critics.  They see only a fraction (and usually a tiny fraction) of what you’re doing.  They most likely know less than you do about the information you had at the time you needed to make a decision.  There is no cost for them to be “Monday morning quarterbacks” because they’re not in the arena with you.  They often criticize as if it’s possible to do a proper split-test experiment on a historical situation, which simply cannot happen. 

Don’t give in to bullying and legalists.  Appeasement is a failed strategy.  Be disciplined but exercise your freedoms.  Both bullies and legalists despise humor, so use it well to help the larger audience understand their pettiness.

Be teachable.  Your critics can help you improve in the future.  There are sometimes hard kernels of truth in the fluff of popcorn. 

Don’t allow yesterday’s criticisms to use up too much of today and tomorrow.  Most of us feel and remember criticism more keenly than praise and commendation.  Train yourself to acknowledge them, and then keep whatever part is valuable in a well-managed “lessons learned” compartment of your mind.

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“Your blog is kinda texty.”

Several kind people have expressed their disappointment with the look of this website. They suggest more pictures, a nicer header, some nifty plugins. I chuckled when one friend wrote “Your blog is kinda texty.”

It’s understandable. Many popular sites are highly visual. People with fast connections like images, videos, flashy stuff.

I’m not likely to make this change.

First, I’m focusing on ideas and words, with the occasional supporting diagram or picture. That’s what I do.

Second, I want this site to load f-a-s-t! Well-formatted text loads faster than images, especially on phones and tablets.

I do appreciate the feedback.

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What’s More Useful than “Gen-whatever” Labels

I arrived near the tail end of the Baby Boomer generation – born 1946-1964

Then come Gen X – 1965-1980

Then Millennials (sometimes called Gen Y) – 1981-1996

Then Gen Z – 1996 to today

(Sidebar: Ever notice the US bias in the way these categories are set up?  Since we’re at the end of the alphabet I expect the next generation will get a nifty nickname rather than a letter.)

You can certainly identify major experiences and events that distinguish these generations.  Those experiences shape what each generation tends to value.  Keep in mind that experiences in the US, China, Columbia, Belgium, and South Africa were significantly different for those generations.

All that makes some sense in the abstract, and affects what self-narrative is reinforced for individuals in those generations.  Yet saying “She’s  in Gen Z therefore ________ must be true” will be inaccurate much of the time.

When it comes to interacting with individuals – genuine flesh and blood people – in your organization, the “Gen whatever” labels aren’t helpful.  It’s much more valuable to understand these things about a person:

  • Behavior and style characteristics (e.g., DiSC or Meyers-Briggs score)
  • Their personal experiences in life, especially early experiences
  • Their passions
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The Best Book for this Discussion is Not in the Business Book Section

Most organizations today strive to be agile, to adapt to new opportunities and threats, and become disproportionately successful with finite resources.  We live in amazing times, but there is no entitlement in a VUCA world.

Every organization must

  • overcome internal friction and disorder
  • make decisions in the face of imperfect information about the changing nature of the marketplace and competitive landscape
  • be creative on the what and how while fulfilling the why
  • focus resources for maximum effectiveness
  • manage the tempo of operations
  • develop and leverage talent and creativity

I can point you to many decent business books on these topics.  The absolute best 100 pages on these topics, however, is Warfighting.  This is the US Marine manual on maneuver warfare.  It has great depth and uses simple language. It fulfills Strunk & White’s dictum, “Omit needless words.”  It’s a book you can go back to many times for fresh insights.  Many pundits recommend Sun Tzu’s famous (and excellent) Art of War for strategy, but western business management is better served by the concepts in Warfighting.  

I often use the paperback version and have given away many copies.

You can read a free copy because it’s a US Government publication:

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The Fallacy and Usefulness of “AI”

“The first principle is that you must not fool yourself and you are the easiest person to fool.” — Richard P. Feynman

Don’t be fooled by the hype and sloppy language about Artificial Intelligence.  The technology advances exponentially, but human nature remains unchanged.  Living wisely requires clear thinking about what AI is, and is not.

The key ideas in one paragraph

“AI” today is all Artificial and no Intelligence.  A true AI would have consciousness and self-awareness, and today’s tools have neither.  Even the most sophisticated “AI” tools today are analogous to viruses – they aren’t alive and are completely dependent on the machinery built by others to work. The belief that a Singularity (a future combination of digital systems becomes independently intelligent) is coming relies on faith without evidence from physics or math.  Consciousness does not spontaneously arise from parts.  The digital tools we’re creating are increasingly useful, and there is great promise for improved human living by expanding our digital services.  All tools humans have developed could be used for good and for evil.  The existential danger of digital tools exists not because of a “Skynet” super-intelligence, but from the fallible humans creating and controlling algorithms and data. 

Let’s unpack these ideas.

“AI” is all Artificial and no Intelligence

Exciting announcements about AI advances come frequently now. Siri is a voice interface which can answer your questions.  AlphaGo defeats the best human Go players.  The Google assistant can make appointments for you.  Deep learning models can interpret X-rays better than human radiologists and make better medical diagnostics than experienced doctors, tapping into knowledge from thousands of medical research papers.  Multiple companies have engineered autonomously driven vehicles (John Deere tractors have had self-driving capabilities since the 1990’s). There are digital tools which can create music, write sports stories for newspapers and web sites, and make recommendations on what you should buy.  These digital tools deliver increasingly sophisticated results and iteratively improve as designers access more data and better prediction models.

All these are amazing and useful, but none of them are intelligent. They aren’t self-aware.  They don’t understand anything.  They are not conscious. They are clever algorithms executing on data, based on their designer’s intentions.  They can “appear” to be acting intelligently, but they only reflect the intelligence of their designers. 

It’s important not to confuse “analyzing a problem MUCH faster than a human” and “generating new information from existing information” with intelligence.  The Deep Blue chess software[1][2][3] which defeated Gary Kasparov in 1996 could analyze millions of sequences of moves in seconds but didn’t understand chess.  AlphaGo is engineered differently, using neural networks and reinforcement learning models[4][5], but is not self-aware that it is playing a game.  Story-creating software creates a news story based on a handful of facts about a baseball game using templated sentence structure and a library of phrases.  The Turing Test[6][7][8] is a measure of sophistication to fool another human being, but not a test for intelligence.

Language inherently requires the ability to infer meaning from a message.  Inference is the process of reaching conclusions that are not explicit in what was said. The fundamental design of digital systems today is deductive by default.  Anything which is predicted as an inference is a probability distribution.  This is a fundamental limitation of O’s and 1’s and silicon-based circuitry.  If an algorithm scans an image and “recognizes” the letter A it is because the probability distribution of the pattern is highly correlated with the letter A, which was trained into the algorithm.  When you speak with Siri or Google, a complicated back-end analysis is assessing the probability of word matches by matching audio wave patterns.  Siri and Google systems do not “understand” your speech. 

These digital tools cannot function apart from physical computer components, memory management systems, and networks to move data packets.  Remove of these human-engineered, human-supported components, and the digital tool is inactive code. 

Digital tools are like a virus. The virus carries information.  A virus is not alive.  A virus is only active when it infects a living cell and leverages the machinery of that cell to produce more viruses. 

The popular press reports on Craig Venter’s progress in creating an artificial living cell gave many people flawed perceptions of what was accomplished.  DNA synthesized in a lab was pieced together to create a working bacterial genome.  This was inserted to a living bacterial cell to replace the natural genome.  Apart from a new instruction kit – which was mostly patterned after the natural DNA instruction pattern – everything else about this “artificial cell” was original[9][10][11].  These attempts tell researchers a great deal about how small genomes operate but they have not created artificial life.

The popular press accounts about AI are also giving citizens flawed perceptions about the nature of AI.

The “Singularity” is a Fantasy

Ray Kurzweil, a brilliant engineer and futurist, has made many successful predictions about technological advances[12][13][14].  He is probably the most famous advocate of the coming “Singularity,” when a digital intelligence emerges which rivals and then exponentially outpaces human intelligence.  In his 2005 book, “The Coming Singularity” Kurzweil suggested that this would happen in 2029, based on the exponential trends of computing power.  More recently, the date has been pushed out to 2040, albeit with little explanation why. [15][16][17]

We can point to two singularities which already happened.  Life started.  Humans appeared with unique intelligence capabilities which exceeded other primates.  The origin of life, and of humans, is deeply disputed.  All known life exploits DNA as a code, and we know of no codes which are not designed.[18]  There is an X Prize available for anyone who can demonstrate a non-designed code[19][20][21]

People have debated the definition of life[22][23][24] and consciousness for thousands of years, without coming to agreement that would support an engineering design spec.  We have multiple mental models and philosophical constructs about consciousness and intelligence.[25][26][27] Even those who agree that not all living things are conscious agree that all known consciousness is associated with a living organism.  The general model that consciousness represents highly integrated information accessible by the brain is far short of an engineering model for how to create it. Kurzweil and others speak about uploading an individual’s consciousness to a digital “cloud” in the future.  A working detail for how consciousness operates will be required if we’re going to engineer an artificial environment to host it.   

I state confidently that a true Artificial Intelligence is not going to spontaneously arise from the kinds of computer systems we have today.  This is comparable to life arising spontaneously from non-life.  It doesn’t matter how many servers you have, what exponential CPU power exists, or how much data you collect.  There is no understood law of physics or math which supports the prediction that self-awareness and intelligence happens at a future critical threshold. 

Belief that a Singularity is coming is faith without supporting evidence. 

The Exciting Potential of Digital Tools as Servants

Digital tools can be extremely helpful and powerful, even if true AI is not going to happen with our silicon-based systems.  I admire and respect the optimism of techno-futurists like Peter Diamandis.  I recommend his book “Bold[28].”  Technology advances coupled with entrepreneurial organizations are responsible for much of the betterment of the world in every measure in the last 100 years.  In 2018 more than 50% of the global population was middle or upper class economically for the first time.  We produce so much food that almost no one has starved to death because of famines since 1990.  Medical advances are tremendous.  Literacy and schooling is available to a billion more people now than in 1980.  We could list many advances like this.

Digitization has been a powerful democratizing factor in making more capabilities available to more people at a much lower cost.  Digitization amplifies the technology advances from biotech, robotics, sensors, energy production/storage, and 3D printing.  Digitization will be a linchpin capability in solving many of the biggest problems still facing our global population.

Yes, we have concerns about privacy of data and how data is used.  Yes, parents are still figuring out how best to raise children who have access to practically any information and can spend hours in virtual reality.  Yes, there are new challenges in our social fabric when even video can be convincingly manufactured to tell any story we want, and bad journalism can promote false information.  Yes, the accelerating technical capabilities are transforming the workplace and eliminating whole some jobs which used to pay a living wage.

Let us be grateful for digital capabilities and aim to be wise in learning how to use it well.  We’ve done this for fire, for the printing press, for electricity, and for nuclear power.  I’m confident we’ll find solutions. Being a Luddite is not a constructive approach.

The Real Danger of Digital Tools

Collectivist political systems are incentivized to monitor thinking and behaviors of their citizens.  The Nazis, the Soviets, and East Germans developed tremendous networks of spies and paper-based tracking systems to monitor their citizens in the 20th century.  It required an enormous amount of human labor.  Before the Berlin Wall came down one of every three East German citizens was an informant for the government.  More recently, Cuba and Venezuela have had elaborate informant networks, though not as extensive.

The Chinese Communist Party is creating a digital, all-encompassing citizen monitoring system.  Digital tools are scalable in ways that human labor is not. They won’t need a third of their population to be informants.  Key components include ubiquitous video, facial recognition, mandatory tracking apps on all mobile phones, government access to all means of encryption, and systemic packet sniffing on network data flows.  They intend to tie this into a “social credit” scoring system where citizens are rated based on their behavior[29][30].  A significant fraction of the government’s investment in AI is related to this monitoring capability[31].

I hope you’re as horrified about this use of digital tools as I am. 

If you think “But that’s just in China,” think again.  Google and Facebook have been “outed” for nefarious use of the data they’ve collected from users.  The algorithms Google and Facebook (and other platforms) use both intentionally and unintentionally shape the way information is categorized and presented.  Google no longer uses their famous catch-phrase “don’t be evil” in their code of conduct.[32][33][34] The US Government has been monitoring network activity of citizens under the auspices of keeping citizens safe from terrorists.[35][36][37]  Amazon has large contracts to provide digital system tools to the US government.[38][39][40]

The common theme here is that a relatively small number of people have the potential to collect information, shape the way that information is accessible or presented, and could use these tools for evil purposes.  Hannah Fry and others have documented how human bias shows up in the way algorithms are designed.[41]

  Though we like to tell ourselves that we would never be the bad guy, history teaches us that anyone could be a participant in evil[42].  Solzhenitsyn observed “the line separating good and evil passes not through states, nor between classes, nor between political parties either — but right through every human heart — and through all human hearts.”[43] Biology and psychology teach us that everyone is limited by cognitive biases[44][45] and are therefore susceptible to manipulation by others. Digital tools greatly amplify the power of individuals to be evil.

We must guard against this current existential threat, rather than worrying about Skynet someday emerging and deciding to nuke the world.  We need frameworks for transparency and a willingness to overcome our greed to make the best decisions about use of digital tools.  They’re here.  They’re not going to disappear.  Nothing short of wise, moral people will do. 

How to proceed?

  • Be thoughtfully skeptical about the way AI is described and sold as a solution to problems.  When you hear “AI” think “digital tool,” like the tools craftsmen and engineers use to create other tools and services.  They’re useful in the right hands, but not independently intelligent.
  • Tell the truth, and don’t accept people telling lies.  This limits the abuses of collectivism and dictatorships.[46]
  • Watch for the unintended consequences of activating many digital tools. There are always unintended consequences.
  • Follow the Money and Power by asking “Who benefits?”  Who benefits from the current hype about AI and the coming Singularity?  Who benefits from controlling access to data and shaping how it is presented?  Who benefits from controlling how the rules work (in this case, the algorithms)?

May we be wise, intelligent people consciously using our non-intelligent digital services for good.

(Glenn Brooke is the author of the soon-coming book, “Bold and Gentle: Living Wisely in an Age of Exponential Change.”  This article is adapted from one of the chapters.)


[1]

[2] https://en.wikipedia.org/wiki/Deep_Blue_versus_Garry_Kasparov

[3]

[4]

[5] https://en.wikipedia.org/wiki/AlphaGo

[6]

[7] https://en.wikipedia.org/wiki/Turing_test

[8]

[9]

[10] https://www.technologyreview.com/s/419359/how-to-make-an-artificial-cell/

[11]

[12]

[13] https://www.wikiwand.com/en/Predictions_made_by_Ray_Kurzweil

[14]

[15]

[16] https://en.wikipedia.org/wiki/The_Singularity_Is_Near

[17]

[18] Evolution 2.0 (Perry Marshall)

[19] The Evolution 2.0 Prize

[20] https://www.herox.com/evolution2.0

[21]

[22]

[23] https://www.nasa.gov/vision/universe/starsgalaxies/life%27s_working_definition.html

[24]

[25]

[26] https://www.verywellmind.com/what-is-consciousness-2795922

[27]

[28] Bold (Peter Diamandis)

[29] Chinese “social credit” system

[30] https://en.wikipedia.org/wiki/Social_Credit_System

[31] AI Superpowers: China, Silicon Valley, and the New World Order (Kai-Fu Lee)

[32]

[33] https://gizmodo.com/google-removes-nearly-all-mentions-of-dont-be-evil-from-1826153393

[34]

[35]

[36] https://www.thenewamerican.com/usnews/constitution/item/16818-document-reveals-nsa-monitored-125-billion-phone-calls-in-one-month

[37]

[38]

[39] https://money.cnn.com/2018/04/03/investing/trump-amazon-bezos-government-contracts/index.html

[40]

[41] Hello World: Being Human in the Age of Algorithms (Hanna Fry)

[42] Man’s Search for Meaning (Victor Frankl)

[43] The Gulag Archipelago (Aleksandr Solzhenitsyn)

[44]

[45] https://en.wikipedia.org/wiki/Cognitive_bias

[46] How Do You Kill 11 Million People? (Andy Andrews)

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“Born This Way” is Not a Sound Theological Argument

(This post is written to my Christian brothers and sisters; all are welcome to listen.)

We often hear people say today, “I was born this way,” or “God made me this way” as a justification for their preferred self-narrative, or excuse for their choices.  

This idea holds less theological water than a colander.

This is logic from Satan, inconsistent with what the Bible teaches us.   We’re all born dead in sin, and yet held accountable by God for that sin.  God has provided a solution to a restored relationship with Him through the atoning sacrifice of Jesus and sanctifying work of the Holy Spirit. 

Supporting passages to explore:

“As he went along, he saw a man blind from birth.  His disciples asked him, “Rabbi, who sinned, this man or his parents, that he was born blind?” “Neither this man nor his parents sinned,” said Jesus, “but this happened so that the works of God might be displayed in him.” (John 9:1-3 and following)

“For as in Adam all die, so in Christ all will be made alive.” (1 Corinthians 15:22)

“As for you, you were dead in your transgressions and sins, in which you used to live when you followed the ways of this world and of the ruler of the kingdom of the air, the spirit who is now at work in those who are disobedient. All of us also lived among them at one time, gratifying the cravings of our flesh[a] and following its desires and thoughts. Like the rest, we were by nature deserving of wrath. But because of his great love for us, God, who is rich in mercy, made us alive with Christ even when we were dead in transgressions—it is by grace you have been saved. And God raised us up with Christ and seated us with him in the heavenly realms in Christ Jesus” (Ephesians 2:1-6)

“When you were dead in your sins and in the uncircumcision of your flesh, God made you alive with Christ. He forgave us all our sins” (Colossians 2:13)

I note that people do not apply the “born this way” logic to pedophiles, embezzlers, thieves, gluttons, drunkards, serial killers, rapists, and murderers – though people routinely claim they were indeed born that way.  This demonstrates the inconsistency of the argument.  Personal selectivity in defining something as not a sin is a hazardous venture.  You are setting your views above the Word from our Lord. You diminish the awful price Jesus paid to save us.  Frankly, it’s a Teflon-coated slope to a place you don’t want to be.

God holds everyone accountable (Ecclesiastes 12:14; 2 Corinthians 5:10).  All things are possible with God (Matthew 19:26) – including overcoming the pull of temptation (1 Corinthians 10:13).

None of this means we stop loving others.  We’re commanded to love others as Christ loves them, which includes calling them to righteousness and away from sin.  We judge those inside the Church fellowship, but not outside it (see 1 Corinthians 5:12-13).

We should hold our leaders to high standards of behavior.  They are not “above” anyone.  They are steering and setting the pace.  Their example is especially influential.  We have a host of historical examples of what happens when we don’t hold leaders to a high standard.

“Born this way”?  Yes.  Yet God loves us so much He doesn’t leave us there.

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Instead of Whining about [HR/IT/Facilities/etc]…

It’s generally low-cost to complain about the quality or quantity of help you’re getting from other parts of your organization… and practically cost-free to whine about groups like HR, IT, Procurement, Facilities, Finance, and Legal. 

Smart leaders cultivate relationships with people in these groups who are (1) critical to their teams’ success, and (2) can share insights about the priorities and perspectives of these groups. 

Here’s the test:  When you have a serious need, is there someone who will happily take your call and prioritize your request above the noise in their inbox? 

Evaluate your network.  Make amends if necessary.  Create new connections where you have gaps. 

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Be on the 5 Side of 95/5 Distribution

I refer to 80/20 frequently.  Distributions are not always 80/20; sometimes we observe 70/30, or 95/5. 

Inequity along any given dimension – athletic skill, access to a resource, particular technical skills, ability to persuade, personal health and wealth, etc – will happen.  Every historical example where people have tried to create uniform results across a population of people have failed spectacularly.  We’ve had much more success at creating equity in opportunities. 

The digitization of most elements of modern living has accelerated the power of network effects.  That means that 80/20 becomes 95/5, and even 98/2. 

You and I don’t have to like this reality, but we’re foolish to fight it. 

Do everything you can to be in the 5% on aspects of life which matter to you.   Most importantly, decide how to be a “benevolent dictator” when you get there, and use your standing for good.  Think of it as a stewardship responsibility.

Metaphor: waves in the ocean.  If you can get on the front side of the wave, the energy will carry you a very long way with almost no additional effort on your part.  That’s what being in the 5% is like.  Once you slip to the back side of the wave, it races away from you so fast you cannot catch it.  Make your plan to catch another wave.

HT: This article was inspired by comments from Perry Marshall

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Scenario Planning

Shaping a preferred future is the work of leaders. Steward Brand wrote “This present moment used to be the Unimaginable Future.”  The future will happen if you’re passive; a better future can happen when you act consciously.

Scenario planning is a useful practice for leaders operating in VUCA environments.  (That’s everyone reading this.)

A scenario is fundamentally a story about a future state – the who, what, were, when, and why.

All our knowledge is from the past; all our predictions are about the future. Be humble about the constraints on our knowledge:

We’re mostly ignorant…

(Image from https://www.smartinsights.com/managing-digital-marketing/planning-budgeting/scenario-planning-marketers/)

There are 4 types of future states:

  1. Possible — “might” happen (future knowledge)
  2. Plausible – “could” happen (current knowledge)
  3. Probable – “likely to” happen (current trends)
  4. Preferable – “want to” happen (value judgments)

Don’t make the mistake of confusing these interrelated but independent elements of scenario planning:

  • Strategic Thinking (exploration to generate options)
  • Strategy Development (assessing options to make decisions)
  • Strategic Planning (implementation actions)

Be sure you have a powerful WHY to carry you through the work.  Curiosity helps immensely, as does working with smart people you enjoy and respect.

Leverage the experience of others to manage the HOW process. Effective scenario planning is not a 30-minute exercise by one person.  Success comes from discussion in the context of deliberate practices.  This sequence will give you the best results:

  1. Identify the focal question and timescale
  2. Scan the internal and external environment (challenge assumptions!)
  3. Select and rank the change drivers.
  4. Identify wildcards.
  5. Build the scenario matrix (possible, plausible, probable, preferable)
  6. Flesh out scenarios with more detail
  7. Consider the strategic implications with stakeholder group(s)
  8. Decide, then create execution plan.  Revisit externals and assumptions periodically

Recommendations for each step:

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