The McKinsey Mind seeks to describe the process that a McKinsey strategy consultant follows when on assignment. I’ve been interested in the process of problem solving and the methodical way in which McKinsey consultants frame a problem, determine a hypothesis then confirm or deny the hypothesis. There were a host of take-ways from the book so I’ll just focus on one key concept, MECE – Mutually Exclusive Collectively Exhaustive.

MECE is a way of problem solving by organizing or grouping information into subsets where the subsets are both mutually exclusive (ME) and collectively exhaustive (CE). Making sure the subsets are mutually exclusive ensures that there are no overlaps or redundant information. Making sure the subsets are collectively exhaustive ensures that you’ve covered all the bases and there are no gaps in information.

Using the MECE concept to solve a problem helps you to methodically work through all the key drivers to a problem and bucket them appropriately. Once the items are bucketed you can create a hypothesis on how to solve each problem. MECE helps to make sure you haven’t overlooked anything. According to the book:

“Being MECE in the context of problem solving means separating your problem into distinct, nonoverlapping issues while making sure that no issues relevant to your problem have been overlooked.”

This concept can force you to structure your thinking and bring order to a chaotic set of issues. Being more structured in your thinking and problem solving can help you arise at a conclusion faster, make better decisions and in turn build a more successful business.

Feedback loop (Photo credit: Wikipedia)

#1. Did I give 100% today

My son plays lacrosse and at the start of every practice the team needs to do a couple laps around the field. My son hates running and typically ends up last. I ask him to look me in the eye and tell me if he gave 100%. The answer is usually no. He can run. He has no injuries. He just doesn’t want to do it. If you’re honest with yourself, there are days when you “mail it” in. For whatever reason, you give 80% or 50% or whatever the number. It’s important to be honest and investigate the WHY. What are the triggers that cause you to lose motivation? There are just some things you need to power through and still give 100% even when you don’t enjoy them. That’s how you get better. So at the end of each day ask yourself this question. Did I give it 100%? If not, be honest with yourself, figure out why and determine to give it 100% tomorrow. Don’t give yourself a pass.

# 2. Did I have the right attitude today?

Everyone wakes up on the wrong side of the bed from time to time, but how do you keep that from affecting your interactions with people and overall performance? It’s probably a good idea to check your attitude BEFORE you get into work. A bad attitude can put everything you deal with in a negative light. It can distort your decision making and de-motivate your staff. Put this feedback loop in place, and then seek to determine the “WHY”. What is causing the negative attitude? Not enough sleep, bad habits, stress, not eating right etc. Once you’ve figured out the WHY, work to put checks and balances in your life to prevent a negative attitude from forming and provide you with a strategy to deal with a negative attitude once it’s formed. Have an accountability partner that will help speak into your life and bring the right perspective.

#3 Was I teachable today?

I’ve written about teachability before. It is really a state of mind (much like attitude). It’s realizing that you don’t know everything and that every circumstance in life can teach you something. The fact is, you’re going to make mistakes. Being teachable allows you to learn from those mistakes and build the wisdom necessary to grow and make better decisions in the future. If you apply this concept to your life, you CANNOT lose. You will literally extract all you can out every circumstance. I have the benefit of having a few folks I can go to and ask questions about business. People that have, “been there and done that”. You should look for mentors and coaches in your life. At the end of the day, ask yourself, “was I teachable today”? If not, decide to be teachable tomorrow.

#4 What Did Today Teach Me?

This point is sort of point #3a but I thought it deserved it’s own section. Everyday has a lesson to teach if we listen. Did you react to a situation in a way that you shouldn’t have. I see themes emerge when I begin asking this question. For example, I looked back at Q1 and asked myself what did Q1 teach me about my business? The answer was, I got distracted and missed a key priority that I shouldn’t have missed. That realization will help me not make the same mistake again. Seek to find out what each day is trying to teach you. Write it down, start journaling your experiences.

Having this simple feedback loop going in your life is critical for helping you grow and be the best you can be.

One of the most interesting chapters focused on the Wall Street mortgage meltdown and how introverts and extroverts approached the situation.

According to the author, each personality type processes dopamine differently. Specifically how introverts and extroverts respond to the prosect of a reward. The author interviewed Dr. Janice Dorn, MD, pHD. Dorn explains that how our brain structure affects the relationship between risk and reward.

Our limbic system (old brain) includes the nucleus accumbens which is sometimes called the “pleasure center” of our brain. This part of our brain is telling us to take risks and “go for all the gusto that you can…and don’t think”. The limbic system also includes the amygdala which the book describes as the part of our brain that influences introversion.

Our “new brain” or the neocortex is that part of our brain which is responsible for reasoning, thinking, planning etc. It’s telling us to be careful, slow down, and think before we act. The old brain and new brain work together, but for extroverts the nucleus accumbens risk signals can tend to take over the reasoning ability of the neocortex. Here’s a quote from the book…

“But just as the amygdala of a high-reactive person is more sensitive than average to novelty, so do extroverts seem to be more susceptible than introverts to the reward-seeking cravings of the old brain. In fact, some scientists are starting to explore the idea that reward-sensitivity is not only an interesting feature of extroversion; it is what makes an extrovert an extrovert.”

The book is filled with studies and examples of how introverts and extroverts react differently to situations and more importantly WHY. I found the book really instructive for understanding my own reaction to situations as an introvert and how to deal with other personality types in a more effective manner. Understanding different personality types (including your own) can really help you to lead and communicate more effectively.

All in all it was a great read.

IMO, “The Lean Startup” is all about the process of making a good decision. As I see it, there are two components to making a good decision: (1) collecting the best data possible (2) grouping the data in a logical way to discover patterns (3) Making your decision

Small Batch Insights

One great insight I received from Ries was the concept of “small batches” (essentially devising a process where you’re able to collect the best data possible). To summarize, a “small batch” involves creating a product in as small of a batch as possible. For example, if you’re building something in assembly line fashion, the goal is to produce as few of the end products as possible. In doing so, you’re able to pick up on issues quickly without wasting a great deal of time or money. The book gives several examples of companies that used a small batch process to pick up on issues, improve quality, receive feedback and make corrections as quickly as possible.

Intuition Insights

The second insight I received from the book revolved around intuition. As an INTJ, I rely on my intuition quite a bit to make decisions. I’ve learned that this can actually hurt you and cause you to ignore new data. Ries reveals that our intuition can fool us at times. Using experiments or small batches can help to reveal problems which are often counter-intuitive.

I like to use the following methodology to determine what to focus on and to make progress on those initiatives. I bucket items into two main categories: priorities and concerns (what keeps me up at night). I then order these into the top 3 for each category. Note: It’s a good idea to check with your colleagues to make sure you don’t have a blind spot which is causing you to focus on something you shouldn’t. I use this same exercise for my direct reports. It ensures the team is focusing on the right things.

Bayes theorem (Photo credit: disownedlight)

I’ve gotten in the habit of tracking priorities and concerns overtime. This helps me to see if I’m spending my time on solving the top 3 concerns or not. I ask myself if I’m making progress on the top 3 priorities. If I’m concerned about the same things week after week, then I need to re-focus.

Next, I drill down even further and purpose to solve one of the top priorities. I Force myself to hyper-focus and get the most important things done. In order to do this, I create a decision tree which seeks to find the root cause of the problem. I talked about “framing” a problem in one of my earlier posts. I take the time to truly frame the problem I’m trying to solve. Do I have enough information? What is the root cause? What steps could I take to solve the problem?

This leads me into my next point which comes out of another book I’m reading, “The Lean Startup”. When you go to solve a problem or answer a question, you need to create a hypothesis. What is a potential answer to the question? I try to think about ways I could test my hypothesis BEFORE I run headlong into implementing a solution. This will allow me to confirm or deny my hypothesis and get to the solution in a methodic way.

So to recap, he’s the process:

1. Catalogue the issues into priorities and concerns
2. Pick the top 3 in each category
3. Purpose to solve one of the concerns (this keeps you from getting stuck)
4. Map out the root cause of the concern
5. Create an experiment to solve the concern
6. Go back to step 1

So what are the top 3 concerns facing your business?

Image via Wikipedia

In the software world (or anytime you engineer or build anything) the best practice is to create a detailed specification which describes what you’re building. Call it a blueprint or design specification; you’re most successful when all the details are defined up front BEFORE you start building.  Jeffery drives this same point home with regard to marketing campaigns…

• Define both success and failure criteria before starting a marketing campaign
  • How many leads?
  • How much traffic?
  • How many visits?
  • What are the goals?
• Design decision points into the campaign execution plan – be prepared to act at these stage gates
  • What will we do if the campaign doesn’t succeed?
  • What will we do if it does succeed?

Here’s a great quote from the book:

“For example, if you planned a 12 week campaign to deliver 1,000 qualified leads per week to the sales force and it delivers only 100, you can ask whether these leads are worth the cost of the campaign. If not, then review how you might improve performance…”

Being data-driven allows you to make better decisions and planning your campaign in advance allows you to make those decisions within a solid framework.

Problem Solving PDCA (Photo credit: Luigi Mengato)

Mr Friga provides a framework for team problem solving and gives real life examples from various McKinsey consulting engagements. He uses the acronym TEAM FOCUS to describe the approach.

T – Talk

E – Evaluate

A – Assist

M – Motivate

F – Frame

O – Organize

C – Collect

U – Understand

S – Synthesize

There are so many valuable take-aways from this book. With my background in science, the idea of creating a hypothesis really resonated with me. The “F” in focus is stands for “Frame”. It is critical to frame the business problem correctly. You do this by identifying the “right” question you are trying to answer and formulating the correct hypotheses. This scientific process forces you to make sure you are effective, efficient and aligned as a team to solve your problem. If the problem is not clearly defined, you can spend time going down rabbit trails that don’t lead to a solution. Once the problem / hypothesis is clearly defined, you can work to collect data which will either prove or disprove the hypothesis. This requires a more disciplined approach, but is necessary for solving complex business issues.

People use the word “love” all the time. I LOVE this pizza. I LOVE my Ipad. I LOVE going to the movies. The true meaning of the word “love” can get diluted and lose its meaning if we’re not careful. So what does it mean to “love and serve each other” when it comes to business? I think that this is an extremely important and powerful value if it is lived out in our lives.

I “love” the Wikipedia definition of the word: “The unselfish loyal and benevolent concern for the good of another”

It’s interesting that Wikipedia uses the term “unselfish”. In order for an enterprise to truly be successful, the participants must be unselfish. Under a high pressure environment, selfishness can easily creep in. Employees (and owners for that matter) can begin to overvalue their contribution and undervalue the contribution from other members of the company. It’s amazing how we can judge what other people do, when we’ve never actually held that position. There is a natural human tendency to look at someone else’s job and compare it to our own. We know all the details and nuances which make our job difficult and only see what’s happening on the outside for one of our colleagues. Take sales for example. Before I started my first company, I was an analytical chemist. I NEVER sold anything. My only exposure to sales was the annoying guy at Best Buy. Sales “looked” easy – until I tried it myself. Until I actually tried to cold call someone, set up an appointment, create a presentation, drive to their office, give the presentation, convince them to buy and collect their check – I had NO IDEA how hard it was (by the way what an incredible feeling when someone says, “yes”!). As they say, don’t criticize someone until you’ve walked a mile in their shoes.

This type of selfish attitude can be a killer in a company. If it gets too embedded you can have departmental wars. You see this sometimes between sales and production. It happened all the time when I ran a laboratory. The folks doing the testing often got frustrated with sales because of out of the box requests which the testing team had to perform. The sales team didn’t really care because they made a sale and were on to the next thing.

If the entire company has “unselfish loyal and benevolent concern for the good of” each other, what an amazing environment. How can that go wrong? This will be infectious to the customer and create a place where people “love” to work. So the next time you think your job’s much harder than anyone else’s, think again and try to love your coworker.

I immediately thought of several areas where a simple DO-CONFIRM checklist could help improve customer service and results for Astonish clients. The concept is simple. Checklists ensure the stupid, but critical tasks are not overlooked. Are there any “stupid but critical” tasks in your business? I’m sure there are. In a fast paced environment, memory and judgment can be unreliable. Checklists help make sure tasks which are critical to success happen every time without fail.

My suggestion is to examine your business for areas where your employees drop the ball. Every business has these areas. Put a simple checklist in place. It doesn’t keep your employee from thinking, but allows them the freedom and security of knowing balls are not dropped.

So how do the best businesses deal with problems? Let’s dive a bit deeper into the way we as individuals deal with problems for some insight.

If you think about your own life for a second, you could probably indentify a few areas where you are stumbling. If you look even deeper and are honest with yourself, you might even say you are ignoring problems.

If you’ve ever watched the TV show Intervention you can see this pattern first hand. The show chronicles the life of a drug addict who is at the end of his/her rope. At the beginning of the program, you get to see how this person first encountered a major problem in their life (divorce, abuse, death in the family etc) which became the trigger for their drug abuse. Instead of facing the problem head-on, they used drugs to numb the pain and avoid the problem. Of course, this never works and they end up having to face an even bigger problem. A good friend of my once told me, “if you leave a hungry dog in the basement, eventually it will get out”.

The truth is; we ALL do this. We ALL avoid problems both in our lives and our businesses. The best businesses have a deep understanding of their problems and are honest about them. They don’t deflect criticism or blame someone else. They are teachable and seek out mentors that can help them.  It takes a humble person to admit when they are the one who is limiting the growth or progress of their own company. Sometimes, the biggest problem is you.

So what to do?

1. Write down the top 10 issues your company is facing
2. Review these issues with a trusted colleague to ensure you are seeing the right issues
3. Honestly admit if YOU are the problem
4. Pick ONE item from the list and WRITE DOWN a detailed action plan to fix it. Don’t move on to the next problem until you’ve fixed the first one

The key here is not to IGNORE your problems. You are going to have to face them one way or another. Start attacking them head-on. Now go solve some problems.