The Art of Action: How Leaders Close the Gaps between Plans, Actions, and Results

by Stephen Bungay

However, in the back of my mind was the thought that the real hard men in the military took the soft stuff very seriously. They seemed to believe that success came from bringing the hard calculating and soft motivational sides together. They also seemed to believe that the soft stuff was more difficult than the hard stuff.

with the habits of a consultant now being second nature, I saw battles not as clashes between nations – as the Battle of Britain is usually portrayed – nor as clashes between individual commanders – as Alamein is usually portrayed – but as clashes between organizations.

Each generation has to relearn old lessons and acquire old skills.

Rommel had inherited an intelligent organization in which the characteristics he displayed were inculcated in every officer.

In 1911, Frederick Winslow Taylor’s classic The Principles of Scientific Management enshrined the machine model for several generations. This approach to management rests on three premises: 1 In principle it is possible to know all you need to know to be able to plan what to do. 2 Planners and doers should be separated. 3 “There is but one right way.”

In 1955, those premises were explicitly challenged by Peter Drucker in his classic The Practice of Management. Describing scientific management as “our most widely practiced personnel-management concept,” Drucker praised the brilliance of its early insights, but added that “its insight is only half an insight.”4 He argued that simply because you can analyze work into its component parts, it does not follow that it should be organized that way. He also argued that planning and doing are not separate jobs, but separate parts of the same job.

Most of the systems in large organizations which determine how people carry out planning and budgeting, target setting and performance management, are still based on engineering principles.

In an unpredictable environment, this approach quickly falters. The longer and more rigorously we persist with it, the more quickly and completely things will break down. The environment we are in creates gaps between plans, actions, and outcomes: The gap between plans and outcomes concerns knowledge: It is the difference between what we would like to know and what we actually know. It means that we cannot create perfect plans. The gap between plans and actions concerns alignment: It is the difference between what we would like people to do and what they actually do. It means that even if we encourage them to switch off their brains, we cannot know enough about them to program them perfectly. The gap between actions and outcomes concerns effects: It is the difference between what we hope our actions will achieve and what they actually achieve. We can never fully predict how the environment will react to what we do. It means that we cannot know in advance exactly what outcomes the actions of our organization are going to create.

There is a model for creating a link between strategy and operations and bridging the three gaps. It involves applying a few general principles in continually changing specific circumstances.

1 DECIDE WHAT REALLY MATTERS You cannot create perfect plans, so do not attempt to do so. Do not plan beyond the circumstances you can foresee. Instead, use the knowledge which is accessible to you to work out the outcomes you really want the organization to achieve. Formulate your strategy as an intent rather than a plan. 2 GET THE MESSAGE ACROSS Having worked out what matters most now, pass the message on to others and give them responsibility for carrying out their part in the plan. Keep it simple. Don’t tell people what to do and how to do it. Instead, be as clear as you can about your intentions. Say what you want people to achieve and, above all, tell them why. Then ask them to tell you what they are going to do as a result. 3 GIVE PEOPLE SPACE AND SUPPORT Do not try to predict the effects your actions will have, because you can’t. Instead, encourage people to adapt their actions to realize the overall intention as they observe what is actually happening. Give them boundaries which are broad enough to take decisions for themselves and act on them.

In the eighteenth century, the Prussian King Frederick the Great had come closer than anyone has ever done to creating an army of robots. It was highly successful. In the early nineteenth century it met with disaster, and embarked on a program of fundamental change to enable it to cope with an altered environment. The changes it embraced were based on insights into the limits of human knowledge and a view of organizations as organisms rather than machines. Far from throwing out Taylor’s initiative baby and Mintzberg’s planning baby, the Prussians embraced them both and helped them to grow up. The methods they adopted evolved from practical experience and experimentation, so they work. They have since been copied by many modern armies, including the British and American.

Frederick the Great had come closer than anyone has ever done to creating an army of robots. It was highly successful. In the early nineteenth century it met with disaster, and embarked on a program of fundamental change to enable it to cope with an altered environment. The changes it embraced were based on insights into the limits of human knowledge and a view of organizations as organisms rather than machines. Far from throwing out Taylor’s initiative baby and Mintzberg’s planning baby, the Prussians embraced them both and helped them to grow up. The methods they adopted evolved from practical experience and experimentation, so they work. They have since been copied by many modern armies, including the British and American.

The word “strategy” comes from the Greek strategos – στρατηγόζ – a military commander.

I tap into the help on offer in order to understand causation and outline the theory on which the solution is based. I find it in the concept of “friction,” the defining characteristic of the environment of war, which I argue is also the defining characteristic of contemporary business which makes executing strategy so difficult. Friction creates the three gaps. The concept of friction is entirely consistent with systems thinking and chaos theory, but it is more useful to managers because it describes how working in a complex adaptive system is experienced. Its elements can be seen and felt, so we can more easily work out how to deal with them.

Clausewitz was on the field on the catastrophic October day in 1806 when two French forces, acting almost as one, destroyed the Prussian Army in the twin battles of Jena and Auerstedt.

3 On War is not only very long, but has a reputation as an abstract, difficult text. As a result, Clausewitz is in good company among his remarkable generation of Germans in being more cited than read.

4 Clausewitz felt the need to confront this reality early on. His first article, published in 1805, was a critique of the most widely read theorist of the day, Heinrich Dietrich von Bülow, who believed that the essence of war could be captured mathematically, through such things as the geometric relationship between the location of an army’s objective and its base.5 Clausewitz castigated von Bülow for distorting the nature of his object. He was trying to turn war into a science because that would make it understandable and tractable. That attempt, Clausewitz believed, created a dangerous delusion.

Clausewitz gives an account of Frederick the Great’s campaign of 1760, which, he observes, has often been cited as an example of strategic mastery. What was truly remarkable about it, however, were not the marches and maneuvers in themselves, but the way they were carried out – “it is these miracles of execution,” Clausewitz writes, “that we should really admire.”9

war, “everything is very simple, but the simplest thing is difficult… taking action in war is movement in a resistant medium.”11

leading Clausewitz scholar has summarized the concept of friction as referring to the totality of “uncertainties, errors, accidents, technical difficulties, the unforeseen and their effect on decisions, morale and actions.”13

It is important here to understand the nature of Clausewitz’s disagreement with von Bülow, and others of the school of scientific generalship.14 They too recognized that chance and uncertainty played a role in war. The difference was that they believed these factors could be eliminated by a more scientific approach to planning.

Clausewitz disagreed on two counts. First, he believed that friction was as inherent to war as it is to mechanical engineering and could therefore never be eliminated but only mitigated. Secondly, he believed that studying march tables and the like was not a fruitful means of mitigation. In fact, he came to think that friction had to be worked with. It actually provided opportunities, and could be used by a general just as much as it could be used by an engineer.

war instantly exposes the exaggerations and half truths of the plan.

The very business of getting an organization made up of individuals, no matter how disciplined, to pursue a collective goal produces friction just as surely as applying the brakes of a car.

The existence of friction is why armies need officers and businesses need managers. Anticipating and dealing with it form the core of managerial work.

Not only is an army not a “well-oiled machine,” the machine generates resistance of its own, because the parts it is made of are human. Although Clausewitz’s metaphors are all taken from mechanics rather than biology, he clearly sees where the metaphor itself begins to break down.

While the scientific school sought to eliminate human factors to make the organization as machine-like as possible, Clausewitz sought to exploit them.

In April 1812, Clausewitz wrote a letter to his pupil, the Crown Prince, listing eight sources of friction: 1 Insufficient knowledge of the enemy. 2 Rumors (information gained by remote observation or spies). 3 Uncertainty about one’s own strength and position. 4 The uncertainties that cause friendly troops to exaggerate their own difficulties. 5 Differences between expectations and reality. 6 The fact that one’s own army is never as strong as it appears on paper. 7 The difficulties in keeping an army supplied. 8 The tendency to change or abandon well-thought-out plans when confronted with the vivid physical images and perceptions of the battlefield.

If we turn again to Clausewitz’s most mature account of friction in Book One of On War, some patterns emerge from the disparity of the elements he enumerates. The following table is derived from a reading of it: GENERIC SOURCE OF FRICTION SPECIFIC SOURCE FROM ON WAR Imperfect information Uncertainties False information Rumors Imperfect transmitting and processing of information Making judgments based on probabilities Stress caused by emotions, including fear Stress caused by physical exertion The number of people in an organization who can cause a misunderstanding or delay Differences of views, especially between leaders External factors Chance (e.g., the weather) Complexity reducing the chances of success through an accumulation of risk We experience friction because of our cognitive limits as human beings.

Hence complexity itself exacerbates other sources of friction.

The outcome is unpredictable because tiny differences in the starting conditions or in the environment of each run can produce a significantly different pattern.

A linear system has two characteristics. It is proportional, in other words a small input produces a small output and a large input a large output; and it is additive, in other words the whole is the sum of the parts. A nonlinear system is neither.

Today, there is a whole realm of scientific endeavor called nonlinear dynamics with mathematical foundations. It has been known since 1975, rather misleadingly, as “chaos theory.” Systems are nonlinear when the state they are in at a given point in time provides the input to a feedback mechanism which determines the new state of the system. Some such systems are sensitively dependent on the starting state. If so, future states are unpredictable. Such systems are called “chaotic.” The term is misleading because their states are not random, merely unknowable.26 Only recent increases in computing power have enabled scientists and mathematicians to grasp their behavior.

The question for managers is what to do. For that, Clausewitz may be more useful. Clausewitz was able to characterize war as chaotic 200 years ago. It was by no means clear at the time that business, which in its modern sense was in its infancy, shared these characteristics. That was about the time that battles had grown so big that no single individual was in a position to control them directly. Wellington was one of the last to do so at Waterloo.

Critical information is held at the periphery, strategy has to be developed and adopted by large numbers of people, and the half-life of a viable strategy has shrunk. Change is now the norm. The syndication of decision making and the ubiquity of change have dramatically increased friction in businesses. It rises with the number of decision makers and it is higher in a changing environment than in a steady state.

Friction is a function of the finitude of the human condition – the fact that our knowledge is limited and the fact that we are independent agents.34 It matters when we work together in organizations because we are then trying to overcome our limitations as individuals by pooling our knowledge in order to achieve a collective purpose. Our limited knowledge is due to things we could know in principle but happen not to – that is, lack of information – and things we could not know even in principle – that is, unpredictable events. And the fact that we are independent agents with wills of our own means that there is further information loss in transmitting and processing information between each other, and we can react differently to that information – even if it is perfectly transferred – because we have independent wills.

Clausewitz describes the effects of friction in terms of two gaps. One gap, caused by our trying to act on an unpredictable external environment of which we are always somewhat ignorant, is between desired outcomes and actual outcomes (as in the example of the simple journey of the overoptimistic traveler). Another gap, caused by internal friction, is the gap between the plans and the actions of an organization. It comes from the problem of information access, transfer, and processing in which many independent agents are involved (as in his example of a battalion being made up of many individuals, any one of whom could make the plan go awry).

How do we get an organization actually to carry out what has been agreed? However, because of the nature of the environment, even if the organization executes the plan, there is no guarantee that the actual outcomes will match the desired ones; that is, the ones the plan was intended to achieve.

A gap in alignment is often indicated by top-level frustration and lower-level confusion.

Gathering and processing more information costs money and time. It is driven by a desire for certainty, a quest which can never be satisfied. Time passes and decision making slows down. Providing more detail is a natural response to a demand for clarity. But clarity and detail are not the same thing at all.

People become demotivated and keep their attention firmly fixed on their KPIs, which become more important than what they were supposed to measure.

A survey conducted by the University of Michigan in 2005 identifies a range of barriers to execution, first among which is the “past/habits” of the organization.

A business organization is a complex adaptive system. We need to understand it as a system in order to know where and how to intervene to change it.

Jeffrey Pfeffer and Robert Sutton, who see it as aspects of yet another gap: the knowing–doing gap. They identify a range of symptoms: talk substituting for action; past habits constraining future action; fear resulting from interventionist and controlling leadership; the proliferation of metrics tied to reward systems; and the misplaced use of internal competition which suppresses cooperation.43

Prussian. QUICK RECAP Before we do so, let us review the argument so far. Clausewitz observed that armies find executing strategy difficult and developed the concept of friction to explain why. Friction manifests itself when human beings with independent wills try to achieve a collective purpose in a fast-changing, complex environment where the future is fundamentally unpredictable. Friction is a universal phenomenon ultimately grounded in the basic fact of human finitude. Its universality means that it applies in some degree to all organizational life, including business. It also means that we can never completely escape it. Our finite nature means that we have limited knowledge, due to things we could know but happen not to (because we do not have perfect information) and things we could not know even in principle (such as unpredictable future events). It also means that we are independent agents. When we engage in a collective enterprise we therefore face the problem of communicating with each other and aligning our individual wills. While we cannot become God, we can deal with the more tractable implications of our finitude. The first step is to recognize it. Internal friction is exacerbated by the fact that in business as in war, we are operating in a nonlinear, semi-chaotic environment in which our endeavors will collide and possibly clash with the actions of other independent wills (customers, suppliers, competitors, regulators, lobbyists, and so on). The internal a...

QUICK RECAP Before we do so, let us review the argument so far. Clausewitz observed that armies find executing strategy difficult and developed the concept of friction to explain why. Friction manifests itself when human beings with independent wills try to achieve a collective purpose in a fast-changing, complex environment where the future is fundamentally unpredictable. Friction is a universal phenomenon ultimately grounded in the basic fact of human finitude. Its universality means that it applies in some degree to all organizational life, including business. It also means that we can never completely escape it. Our finite nature means that we have limited knowledge, due to things we could know but happen not to (because we do not have perfect information) and things we could not know even in principle (such as unpredictable future events). It also means that we are independent agents. When we engage in a collective enterprise we therefore face the problem of communicating with each other and aligning our individual wills. While we cannot become God, we can deal with the more tractable implications of our finitude. The first step is to recognize it. Internal friction is exacerbated by the fact that in business as in war, we are operating in a nonlinear, semi-chaotic environment in which our endeavors will collide and possibly clash with the actions of other independent wills (customers, suppliers, competitors, regulators, lobbyists, and so on). The internal and externa...

Directed Opportunism Do not command more than is necessary, or plan beyond the circumstances you can foresee

3 The Army had been run as a machine which required iron discipline to function because the motivation of its men was low.

The Prussian Army needed to get cleverer and faster. Of the three fundamental variables in warfare – force, space, and time – lost forces could be replaced and lost space could be recaptured, but lost time could never be made good. It was essential to take actions which were about right quickly, rather than waiting to be told what to do. The only way of doing so was to develop a professional officer corps with the ability, authority, and willingness to take decisions in real time. With the introduction of general conscription in 1808, the officer ranks were officially opened to all, regardless of social position, and promotion was driven by performance rather than years of service.7 So it was that the transformation of the Prussian Army began with people and culture, spearheaded by officer selection and training.

Von Moltke espoused the cause of independent action by subordinates as a matter of principle.