How to make your organization more experimental

Oscar Corona started his own company, an agency for a large Mexican insurance company. Oscar quickly recognized that in order to succeed in an industry in which 90% of start-ups failed, he had to experiment; he had to be open to changing his mind in the light of results if he was to avoid financial ruin. “I learned quickly there is no one predetermined guaranteed path to success, there is only a series of business experiments from which you learn”.

Oscar decided to experiment with the recruitment process. He realized that the traditional approach to recruitment attracted conventional people, and he needed exceptional people. Oscar asked himself a question (all good experiments start with a question): where do you find large numbers of people queueing up to take part in something?

Notice that the question itself indicates a different mindset about what it is to join a business. At the heart of the question is the phrase, ‘to take part’. Some of the synonyms for the phrase, ‘to take part’, include, ‘throw in with’, ‘come on board’, ‘sign up with’, and ‘be in’.

In contrast, the more conventional question: how do I persuade people who have the required pre-existing competencies ‘to apply for’ a predefined role, has at its heart the phrase ‘to apply for ‘, the synonyms for which include, ‘to bid for’, ‘to appeal to’, ‘to seek to’ and ‘to claim’.

The starting point for creating an experimental organization is to encourage people to ask great questions.

And to do that we have to let go of the comfort of the status quo. To allow people to think the ridiculous. The futurist Jim Dator is credited with saying: “any useful idea about the future must at first seem ridiculous”. We need not only to think about the ridiculous but to express it. And that requires psychological safety, the confidence to express whatever seemingly ridiculous, counter-conventional ideas we may have, without fear of sanction. The first condition for creating an experimental organization is psychological safety.

But Jim Dator goes on to qualify his statement by cautioning us that: “not every ridiculous idea is useful’. The problem is you can’t know in advance which ridiculous ideas are useful and which are not. So, you need a mechanism for selecting and testing the most promising ideas – an experimental method.

Experimentation is a disciplined process of testing hypotheses to learn and then applying what is learned. A business must decide how many of its operations, products, and management practices it can experiment with at once. If there is no experimentation it is only a matter of time before you are out of business; too much experimentation and the same applies.

The principle is: don’t bet the farm; bet the field. The second condition for creating an experimental organization is to establish and train people in a business experiment method. ‘Agile’ project management is one such method.

But as many organizations have learned, sticking an experimental method on top of a traditional hierarchical bureaucratic organization simply adds to people’s workload, dissipates effort, and undermines performance.

Successful experiments depend on a dedicated multidisciplinary team with the time and resources to focus on executing and completing experiments in a timely manner. This means freeing up people’s time and particularly managers’ time.

Most organizations make inefficient use of managers’ time. Meetings are attended by too many people, go on too long, and are held too frequently. Why? Because management has become synonymous with control, and to control your need to be constantly checking and monitoring other people’s work to ensure the right decisions are being made and the right results delivered.

Managers need to get out of their comfort zone and trust the people who report to them to do the right things to keep the business on track.

In his counter-conventional approach to captaining and turning around the performance of the US submarine the Santa Fe, David Marquet insisted on moving the authority down the hierarchy to where the information lies. This is in contrast to the conventional hierarchical approach of feeding the information up to the highest level for the decision to be made and cascaded back (through middle management) down to the front line. David Marquet gave his crew intent – ‘here is what we are trying to do’: – and then gave them control – ‘you decide how to do it’. He retained one decision only, whether to launch a missile. If giving away control can be done in the military, it can be done in business.

So, if we remove the managerial comfort banket of having control what do we replace it with?

We replace it with asking great questions, developing promising hypotheses, constructing experiments, and maximizing learning. This is the third condition for creating an experimental organization, shift the management role from control to experimentation.

Oscar Corona answered his question, “where do you find large numbers of people queueing up to take part in something?”, with the ridiculous idea that recruitment is like selecting candidates for a television reality show such as The Voice. These are shows where ‘hopefuls’ line up in large numbers in order to display their singing talents in front of a live audience and a panel of established singing stars.

Oscar then turned this answer into a testable hypothesis. IF I think of my business as an exciting experience, present that experience to the outside world, and design an audition process rather than a recruitment process, THEN, I will have the opportunity to select people who want to take part in and contribute to an experience rather than those who want a job to match their existing expertise, and this will enable me to select exceptional people.

The best organizations are not those with the best strategy – most organizations in the same sector have very similar strategies.  The best organizations are those with the ability to generate great ideas, test them through experimentation, learn and then experiment again.