Unnecessary Complexity - a Prime Corporate Hazard

Unnecessary Complexity, a Prime Corporate Hazard

Fernando Moraes RibeiroBMA Consultoria

Petrobras E&P Aviation Advisor

20 September

Tuesday, September 13, 11

Objectives

• NOT to reinvent the wheel

• NOT to rediscover the fire

• NOT to be boring

• Share a straightforward view of existing stuff that just seems to work

• Learn from the audience inputs

• Contribute to make our industry safer

2


Summary

• Introduction

• The problem:

- Sources of unnecessary complexity

• A solution:

- What corporations can do about it

• Why it can work:

- Crunching unnecessary complexity

3


Who prefers complexity?4


And yet...

“For every complex problem there is an answer that is clear, simple, and wrong”.

H. L. Mencken

5


Complexity setbacks

Sometimes, no matter how good are the intentions, it’s

just too much

6


Complex systems defined

• “A system in which large networks of components with no central control and simple rules of operation give rise to complex collective behavior, sophisticated information processing, and adaptation via learning or evolution”; or

• “a system that exhibits nontrivial emergent and self-organizing behaviors”, e.g. “ants colony”

Melanie Mitchell, in “Complexity, a Guided Tour”, Oxford University Press 2009

7


• Effective management systems should not fit the definition of complex systems

• Even facing a lack of coordination, direction and control, companies tend to keep going like complex systems

• That drive turns what could be “clockwork” into a form of “ants colony” work, reducing predictability and increasing risk, in a unnecessarily complex system

Complex systems defined

8


Clockwork or ants work?Your Organization

Effective Management

System?NoYes

9


My watershed event

• Brazilian Naval Aviation, solid safety culture, sustained success in high risk ops, but...

• June/2005: 2 pilots killed in single engine helicopter night VFR mishap over urban area

• More than17,000 potential system improvements treated in the previous 5 years

• What did we miss?

10


Lesson learnt

Abundant risk controls do not compensate for their lack of assurance

11


The problem:Sources of unnecessary

complexity

12


Sources of unnecessary complexity

Lack of systems and process approach

Misconceptions about quality and risk management

Poor recurrence investigation

Outcome-centered improvement

strategies


13


Agreed definitions

Process

“a set of interrelated or interacting activities, which transforms inputs into outputs”

ISO/TC 176/SC 2/N544R3 October 2008

So much better than “set of interrelated or interacting elements” (ISO 9000:2005, 3.2.1)

14


Agreed definitions

Inputs Activities Outputs

Work


15


Agreed definitions

System

“network of interdependent components that work together to try to accomplish the aim of the system”

W. E. Deming in “The New Economics”, MIT CAES,1994


16


System and process

Not a chance to solve the

puzzle!

Step 1:complete side,

considering sides interfaces

Rubik’s cube

17


System and process

Step 2:complete 2nd layer and keep

previous progress

Step 3:flip it upside down and complete final

layer, idem

Step 4:amaze your audience

18


System and process• System interdependencies

do exist even if unknown

• Any change in a component affects the system

• Change can be managed so that previous progress is preserved

• Not following the process steps makes the solution very much harder

• Procedures effectiveness is heavily process-based

19


Rubik’s cube lessons

• The cube can assume more than forty-three quintillion different system states, so it is very unlikely that you solve it by managing to revert the original shuffling sequence, but...

• ... a handful of procedures, underpinned by a single defined process, allow the average Joe to benefit from the system interdependencies and solve it in less than one minute, no matter how masterfully has the cube been shuffled

20


The systemProcessProcess

ProcessProcess

Interfaces

Interdependent components

21


Work W

ork

Work

Work

Work

ProcessWork

Work W

ork

Work

Work

Work

Work

Process

When a process output is needed as an input for

another process

Process interfaces


But how is the work generated?Like this?

(defined process, quality controls and assurance)


Or like this? (well, you know...)

Or like this?


"A rule of thumb is that a lousy process will

consume ten times as many hours as the work

itself requires."Bill Gates, in “Business @ the Speed of Thought: Succeeding in the Digital Economy”

25


Lack of systems approach

• Symptoms:

- Implementing some system rather than approaching the work as a system

- Disregard of the dependencies between undesired outcomes and of potential synergies/conflicts between improvements

- Poor traceability of the system objectives within the actual work

- "Big picture" more spoken than actually seen

26


Lack of process approach

• Symptoms:

- Nature of the system’s interdependencies is mostly unknown

- Gaps, overlaps, and conflicts within the procedural baseline

- Lower predictability of the outcomes

- Inadequate framework for improvement and for automation

- “We used to have those diagrams, didn’t we”?

27


Entrenching inefficiency

• ‘‘The first principle for any technology you contemplate introducing into a business is that automation applied to an efficient operation will magnify the efficiency”

• “The second is that automation applied to an inefficient operation will just entrench the inefficiency’’

28

Quotes attributed to Bill Gates


A quick recap

• Approaching the work as a process means to determine the inputs required and outputs provided by each activity and to sequence them efficiently and effectively

• Approaching the work as system means to consider the interdependencies (process outputs required as inputs for other processes) to achieve the work objectives

29






strategies


30


Agreed definitions

Quality

“degree to which a set of inherent characteristics fulfills requirements”

ISO 9000:2005, 3. 1.1

31


Agreed definitions

Risk

“effect of uncertainty on objectives”

ISO 31000:2009, 2.1

32


Agreed definitions

Management

“coordinated activities to direct and control an organization”

ISO 9000:2005, 3. 2.6

33


Work

Work

Work

Work

Work W

ork

Work

Objectives?Ha ha, what a

joke!

Daily firefighting

34

Hard working people doing their best under the lack of coordination, direction and control

Objectives


Work

Work

Work

Work

Work Work

Work

Objectives

“Coordinated activities do direct and control an organization”

Management

35


Work

Work

Objectives

Management system

36

Work

Work

Work

Work

WorkWork

Work

A network of interdependent and coordinated activities to direct and control an organization to accomplish its objectives


WorkWork Objectives

Unc

erta

inty

Req

uire

men

ts

Ass

uran

ce

Protection against variance

All kinds of requirements go here(and compete for resources)

Protection against the effects of uncertainty

Degree to which a set of inherent characteristics fulfills risk management requirements = SAFETY

Risk and quality management approached as a system

37

A valid argument providing confidence

RM QM


A challenge:

Could “safety” be defined independently of any need to

fulfill requirements (i.e. quality)?

38


Let’s try...

Safety:

“A vague assumption that supposedly takes place between accidents” ???

39


Safety: “There will always be holes in the cheese, so we need more slices for our protection”

Quality: “The holes in those cheese slices are nonconformities. Just eliminate their root-cause and we will be OK”

Reason’s

Swiss

Cheese

Model

Typical safety and quality mindsets

40


Lower quality, increased risk

Level of risk

ALARP

Risk controls

41



Level of risk

ALARP

Risk controls

42



Level of risk

ALARP

Risk controls

43



Level of risk

ALARP

Risk controls

44


Both more (or better) cheese slices and less holes can improve the

protection of the system’s objectives


But how to determine the quality and risk

management failures related to an intolerable

outcome?


“God, grant me the serenity to accept the things I cannot change;

Courage to change the things I can;

And wisdom to know the difference”

by Reinhold Niebuhr

The Serenity Prayer

Scope of risk management Scope of quality management

Our next slide47


What went wrong?Intolerable Outcome

Could it be prevented?

Failed Quality ManagementFailed Risk Management

“Hell, yes”Risk control requirements not

fulfilled under predictable conditions

“No, we never saw it coming”Effect of uncertainty on inadequate or absent

requirements

48

Includes tolerability assessment failures


What went wrong?

49

Replay


Misconceptions on quality and risk management

Mindset

QualityUncertainty is not considered as a

cause

SafetyUncertainty is assumed as the primary cause

Symptom (In)Effect Why

QM solutions for RM

problems Recurrent ineffectiveness

, leading to “more from the same” solutions

There will always be

uncertainty

RM solutions for QM

problems

Recurrent ineffectiveness

, leading to “more from the same” solutions

Lack of assurance

stays untouched

50






strategies


51



• Recurrence: a golden opportunity to make process or system level improvements...

• ...usually wasted by an absent or superficial investigation of why previous improvements were not sustainably successful

• A Safety Case can be extremely helpful in this regard

52


Why did it go wrong again?

Intolerable Outcome Effective investigation?

Recurrent intolerable outcome

53

Well conceived solutions?

Well implemented

solutions?



Yes

Yes

No

No

NoPlease go and take your bad luck

elsewhere!

Yes



• Symptoms

- Absent or lifeless Safety Case

- Memory-based recurrence threshold

- The adequacy of previous improvements is not validated

- Outcome-based rather than process-based classification systems

- Sisyphus mindset

54


Outcome-based classification systems

“Needles and haystacks and such” by Jessica Haggy in www.thisisindexed.com

55


http://www.thisisindexed.com

http://www.thisisindexed.com





strategies


56


Outcome-centered improvement strategies

• Symptoms

- Recurrent, uncoordinated and redundant efforts, which tend to fade away over time

- Ever-growing list of pending actions

- Prescription creep

- Resources exhaustion: “If it ain't broke, don't fix it”

57


Example of an outcome-centered strategy

58



Misconceptions on quality and risk management



strategies


59


A solution:What corporations can

do about it

60


What does the first ranked result on Google image search for “complex”, “process” and

“flowchart” look like?


Business Process Improvement (BPI) Objectives

• Effectiveness: Does the process produce the desired results and meet the customer’s/client’s needs?

• Efficiency: Does the process minimize the use of resources and eliminate bureaucracy?

• Adaptability: Is the process flexible in the face of changing needs?

Susan Page, in “The Power of Business Process Improvement”, AMACOM , 2010

62


The Ten Simple Steps to BPI

Susan Page, in “The Power of Business Process Improvement”, AMACOM , 2010

1 - Develop the Process Inventory 6 - Apply Improvement Techniques

2 - Establish the Foundation 7 - Create Internal Controls, Tools, and Metrics

3 - Draw the Process Map 8 - Test and Rework

4 - Estimate Time and Cost 9 - Implement the Change

5 - Verify the Process Map 10 - Drive Continuous Improvement

63


64

Good points, but how truly

new is all this process stuff?


ISO 9000-1:1994

• Organizations are made up of processes

• Organizations must identify, organize, and manage this network of processes

• The link or interface between each process must be clearly defined and well managed

• 20 prescriptive Quality system elements

Praxiom Research Group, http://www.praxiom.com/iso-9000-1.htm

65


http://www.praxiom.com/iso-9000-1.htm

http://www.praxiom.com/iso-9000-1.htm

ISO 9000:2000

Figure 1 — Model of a process-based quality management system66


Tough questions

• How much change did the ISO 9000:2000 process-based management system model brought into the actual work of certified Organizations?

• How many times has your continuous improvement effort focused not on the blocks, but on the arrows of the process-based QMS model?

• Can you “see” those interfaces in the real world?

67


68

But, hang on, flight safety

pro’s have been studying interfaces way before that!


CAP 719 - Fundamental Human Factors Concepts, 2002

Without these interfaces...

... no work is actually done

Edwards, 1972 + Hawkins, 1975

S = Software (procedures, symbology, etc.)H = Hardware (machine)E = EnvironmentL = Liveware (human)

In this model the match or mismatch of the blocks (interface) is just as important ad the characteristics of the blocks themselves. A mismatch can be a source of human error

69


The corporate responsibility

* That includes health, safety, security, environmental

How to create the conditions to drive contracted aviation Operators towards an

effective process-based management system, suitable to support the accomplishment of the system’s objectives* whilst fulfilling the

applicable requirements?

70


Current Petrobras contract requirements• The Aviation Operator shall have a fully

operationalized process-based management system

• SGSA (portuguese acronym for Aviation SMS) process framework, entirely based on Steve Walter’s Integrated Management System (IMS)

• Yearly process and contract 2nd party audits

71


SGSA process frameworkSGSA process frameworkSGSA process framework1. Management Commitment and Leadership 12. Assurance of Competence 23. Execution of Daily Operations

2. Culture 13. Communication 24. Process Metrics

3. Customer Focus 14. Service and Product Acquisition

25. Audit

4. Policy 15. Hazard and Effects Management

26. Investigation

5. Objectives 16. Safety Case 27. Evaluation

6. Organizational Structure 17. Procedures28. Quality Assurance in Flight Operations and Maintenance

7. Roles and Responsibilities 18. Planning and Plans 29. Action Plans

8. Process Definition 19. Change Management 30. Records and Data

9. Documentation of the Management System 20. Asset Integrity 31. Management Review

10. Resources 21. Work Environment 32. Continuous Improvement

11. Standards22. Contingencies and Emergency Response 33. Human Factors


Current Petrobras contract requirements

• For each of the 33 SGSA processes there is a single paragraph description, for which the Aviation Operator shall demonstrate:

- Documented inputs, activities and outputs

- Effective process operationalization

- Dedicated metrics and performance criteria

- Regular review and continuous improvement

73


Not bad!74

A process-based management system for an air transport service provider,

specified by the Client through just 33 non-prescriptive single paragraph process descriptions and 4 single-lined questions?


Auditor AuditeeLet’s have a look at your Process 4 - Policy Here is our Quality policy.

OK. Now, perhaps you could show me the process whereby such a neat product was generated.

I don’t know such process, but is it there a problem with our policy?

Not a problem at all, but I must determine if your Company has the ability to sustainably reproduce such “absence of problems” in any other policies.

If this one is good, why wouldn't the others?

Well, according to your reasoning, if there was no accident last year, there will be none ever. Should we worry about this? (resignated yet revengeful silence)

Anyway, although there is no defined process, your policy is good work and can evidence some operationalization. (stressed smile, sighs of relief)

Now, although there is no defined process, could you evidence a metric applied to your policy product? But who in the world does it anyway?

Mostly, Organizations committed to know if their policy generation skills are improving or degrading, and Operators aspiring to work for our Client.

(I hate you. Die at once)

Now, what can you show me about review and improvement? Management Review default agenda includes policy as a topic

Good stuff! When was the last time a meaningful improvement has emerged from such strategic activity? I have no record of this...

Hmmm,,, I see. Now, heads up for process 5 -Objectives... (Drunken Auditee tries to hang himself at the nearest tree)

Typical SGSA first time audit


76

Ok, I’ve got it. But how

can you recognize a process-based

management system in the real world?


Process-based management system traits

• Processes and their interfaces are the primary focus of the investigation of any undesired outcome or variation

• Processes are the primary focus of the improvement effort

• Processes and practices monitoring is paramount

77


Process-based management system traits

• Higher level documents (e.g. Management System Manual) containing the process’ definitions tend to be the most frequently updated

• Operational documentation (procedures, work cards, checklists) cascade from validated process improvements

78


A neat addition to...

Prof. James Reason “Errore Umano” presentation, 20 March 2007

Process-based MS investigation


Why it can work:Crunching unnecessary

complexity A sample of SGSA processes descriptions

80


8 - Process definition

• The process whereby the full scope of work is approached as a set of interrelated or interdependent activities which transforms inputs into outputs, which are then documented and integrated to form a system, in support to the achievement of the organizational objectives.




Outcome-centered improvement strategies

✓ ✓ ✓ Tuesday, September 13, 11

26 - Investigation

• Process to determine the root causes or failures in the prevention, control or mitigation of any undesired outcome, variation or condition with the the potential to adversely affect the achievement of the organizational objectives.

✓ ✓ Lack of systems and process

approachMisconceptions about quality

and risk managementPoor recurrence

investigationOutcome-centered

improvement strategiesTuesday, September 13, 11

27 - Evaluation

• Process whereby the mass of data generated against process metrics and performance criteria is systematically assessed, consolidating trends and variation as strategic information to support informed management decisions






29 - Action Plans

• Process whereby the Organization continually determines, sequences and documents the leanest set of viable actions that will maximize overall improvement, based on a informed system's approach to the bulk of recorded undesired outcomes or trends.






SGSA process modularity

• Even a process-based management system may have similar activities named differently within different processes.

• Each SGSA process has been tailored for its uniqueness within the framework

• This means that an entire SGSA process can be an activity within another process

• Let’s see a quick sample of this...

85


19 - Change management (sample)19 - Change management (sample)

Inputs

• Incoming change from:- Action plans (output of process 29)- Regulation, Client and internal requirements- Business Plan- Other sources

Activities

• Assess the change: mandatory/proposed, criticality, complexity, time frame, adaptation time, individuals/departments affected

• Assess system resilience to the effects of change• Determine the need of a change management plan• Assess the risk of change implementation (interface with process 15 - Hazards and

Effects Management)• Determine the resources and competences required to control the assessed risk

(interfaces with Process 10 - Resources and Process 12 - Assurance of Competence)• Determine the required authority level to approve the change (interface with process

7 - Roles and Responsibilities) • Approve/discard change (interface with Process 1 - Management Commitment)

Outputs

• Change is approved or discarded• Change management plan is mandated/dismissed• Planning information (input for process 18 - Planning and Plans): time frame, risk

controls, resources and competence required to effectively manage proposed change• Review information (input for process 31 - Management Review)


Advice on the transition to a process-based MS

• Define and document, for each process, inputs, activities and outputs based on the elements of the work as performed that match the given process description

• Investigate undesired outcomes starting from your documented process definitions. Challenge their effectiveness

87



• Adopt the number of correlations with undesired outcomes as the default metric for process performance

• Improve processes definitions and/or related work, after assessing the framework for potential conflicts or synergies

88



• Once your process definitions are able to withstand the reality check against the process related work, as actually performed, and the 33 given process descriptions, it is time for the next big move: matching your procedural baseline with your process definitions

• Final move: detailing individual activities at task level, based on your process-enhanced procedural baseline

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Integration through shared processes

• SGSA framework modularity and non-prescriptive nature allows processes to be shared across systems required by specific standards, including ISO QMS, ICAO SMS, IOSA, occupational health, environment, security

• Process sharing, rather than documental integration, makes life easier in document-centered audits, while preserving system cross-functional effectiveness


91

Integration through shared processes

• Integrate the management of requirements from different standards through shared processes, instead of through integrated docs

• Develop standard-based compliance docs, cross-referencing the processes shared, to make your life easier in audits. This would be your “Quality Case”


Final thoughts

• Don’t take systems approach and process approach for granted - extremely low acceptable means of compliance on those two principles haunt QMS certification in our industry

• Removing useless stuff from your system can be more effective than adding “more from the same” stuff - relief all the “bench sentinels” from duty

92


Final thoughts

• Unnecessary complexity does not happen at once, but incrementally over time

• Unfortunately in aviation, a few good people performing a really fine work may sometimes not to be a sustainable exercise

• Such sustainability can be more easily assured in aviation through effective process-based management systems

• That is a Petrobras requirement for their contracted aviation Operators

93


Unnecessary complexity

The equation above provides the following strategic information:

Equations provided by Prof. Gustavo Maia (In memoriam)

94

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Unnecessary complexity

1 + 1 = 2

What your management system should be able to deal with:

What most of your workforce should need to know:

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Questions?


Contact

• [email protected]

• [email protected]

• + 55 21 91938861

• Skype ID: fermrib

• Blog: www.process-based.com


mailto:[email protected]




http://www.process-based.com

http://www.process-based.com

Unnecessary Complexity - a Prime Corporate Hazard

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