The Value of Zero-Based Thinking to See the Forest Beyond the Tree

by Tom "Bald Dog" Varjan, Organisational Provocateur

Some people may say that we must specialise (or die), but I believe it is even more important to develop a breadth of knowledge not only narrow but also deep skills. For example, look at firms that – used to - promote narrow concepts like Six Sigma, Reengineering or Quality Circles.

Where are those puppies? All right, Six Sigma is still alive and kicking, but the other two and many other fads have died in screaming agony. And people who specialised on those concepts have just vanished. Where is Michael Hammer, the Reengineering dude?

On the other hand, look at Peter Drucker. He is a lawyer by schooling, but his real skills help him to reach well beyond law. Or consider Tom Peters? All right, he is a first class provocateur. Beyond that he is a great generalist who can think big and kick some corporate arses into serious action.

And here comes a typical problem with accountants who also pose as business consultants. The problem is that accountants are pretty risk-allergic people and business is inherently riddled with risks. The other problem is that accountants are educated in numbers. For them every problem is a number problem. When all you have is a hammer, everything looks like a nail. I still maintain that profitability is the material manifestation of a great business culture and people with passion, enthusiasm, ambition, and other emotional indicators.

And this is what most accountant-turned-consultants do. They look at the balance sheet and recommend to cut the marketing budget, disallow any kind of skill development and propose a 35% downsizing. These are the people for – most of - whom every expenditure is a waste of money, and there is no such thing as investment in future improvements. Maybe that is why most accounting firms suck financially. Just check productivity (generated annual fees per person)

So, why do executives hire broad-based consultants, coaches and other advisors? They provide ongoing reality check, they offer new perspectives and fresh frames of reference. Here are some more examples:

giving us a broader view of the problem
helping us to discover the real cause beyond symptoms
expanding our thinking and our horizons
pulling my nose off the grindstone, so I can see clearly the forest from the tree
assisting us to dissect problems and rebuild the pieces into a brand new whole

The common denominator is that advisors offer their experience, education, intuition and finesse to think and act beyond the limitations of a specific industry’s conventional wisdom.

A firm’s senior partners can say they are planning to grow by 25% in the next year by hiring two new associates. That is great, but maybe with the help of an external advisor they could achieve 33% growth without hiring anyone.

For example, when people at a firm say, that for next year we project 15% revenue growth. That is great, but with a short examination an external advisor may discover how to push that growth up the 15% to 25%.

But most service firms are complacent (yes, the overinflated ego) and grossly mismanaged, so they will overlook that potential extra 10%.

What clients value the most in their advisors is zero-based thinking, that is, thinking big, thinking on the edge, which is based on the skill of synthesis, and not analysis, as so many managers mistakenly believe.

Analysis is taking the whole apart, and anyone can do that with reasonable ease. Just look at a simple example. Can you take your car apart? I bet you do? What about putting the pieces together in such a way that you end up with a roadworthy car and not with a pile of scrap metal? That may be just a tiny bit more complex.

Synthesis is putting the pieces together and creating a broad variety of “wholes”. That is real skill. The concept of synthesis is that you have the ability to recognise patterns and trends, reframe things and simplify concepts, so you can re-build the whole in many many ways.

Because of this ability to synthesise, it is always a good idea to invite a consultant to conduct a company’s strategic planning programmes.

Very often synthesis includes a healthy dosage of illogical, counterintuitive and even crazy ways of putting known pieces together.

Just look at the telephone and the telex. How many years had gone by until some renegade – someone who was not limited by the conventional wisdom of that specific industry - dissected both the phone and the telex, put the pieces together in a completely different way (the way the industry is not supposed to work) and called it the fax machine. Can you see why it is a dumb idea to demand industry-specific knowledge from your advisors?

The common problem with analysis is that it repeatedly uses the same patterns to find out more about something that should be replaced altogether. Just think about it. For years, people had been breeding better and better horses for their carts, and one day a “lunatic” came along and suggested that people should get rid of their horses, put engines into their carts and call them cars.

Or here is another example. Firms get so busy growing their revenues that they totally ignore an even more important indicator: Revenue per employee. Tell me quickly. If you double your revenue from $1,000 per year to $2,000 (100% growth), and also grow your personnel from 10 people to 15 people (50% growth), what is that? Is it really 100% growth or self-delusion? It is fine and dandy, except that your growth is not 100%, but a mere 33% from $100 revenue per person to $133.

But analysts are still basing a company’s growth on total revenue. How sad! How narrow-minded! How analytical! How retarded!

So let’s discuss how we can bring in some zero-based thinking to our clients.

Let’s get started with the basics, which is usually a great purpose of doing what we are doing. As Bill Gates’ purpose is to put a Windows-driven PC on everyone’s desk, we too must have a purpose that is huge. So, with this in mind, we must keep our clients’ biggest goals in mind.

You must understand the client’s bigger picture. There is a good chance that you will see much further, thus you can think bigger than your clients. Remember, besides thinking big, your clients are also bogged down with micromanaging. Count on this puppy. It is just human nature that we love poking our little noses into other people’s affairs. The only exception I have experienced is in the United Kingdom. The British have this – in my opinion – highly admirable attribute of “None of my business”.

You must understand the company’s critical challenges, so you can make sure your clients do not get replaced by working on irrelevant issues. When a company has 100% talent turnover, then it is a fatal mistake to run a marketing analysis project. However, if the CEO got her MBA in marketing, then everything is likely to be marketing issue for her, and the board of directors may easily pronounce the ultimate “Red Queen” judgement on her: “Off with her head”.

This is where the purpose comes to your aid. Every critical issue must be measured against the purpose and vision of the company. If the company’s vision is to be a market leader, it cannot clog up the shop with minimum-wage people (a sadly common practice in Canada). As the British say, “if you pay peanuts, you get only monkeys”, and when we look at the overall business performance and level of innovation in Canada, we can better understand why Canada is ranked at the bottom end of the western world.

The other factor is that what your clients see is hardly ever the problem but a mere symptom. As an objective outsider, you have a much better chance to see the real problem. Yes, when you point out that the emperor has no clothes, sometimes you may get fired, and in the long-run it is better for your sanity if you want to keep business a jerk-free zone.

So, let’s sum it up here the three key ingredients you need for doing a thorough analysis and, even more importantly, synthesis. Get clear on the client’s vision, the big picture of the business and the critical realities. Also, it is important to note that more businesses are limited by attitudes, beliefs, behaviours and thinking patterns, not by economy and governments. First people must be willing to change inside, and only then they can manifest changes outside.

Conventional wisdom says: If I have (something), I can do (something) and I can be (someone).

I believe first we must be (vision, beliefs, character, attitude, etc,) then we can do (behaviour, whatever we are ready, willing and able to) and then we will have (whatever).

And now let’s see some tools and tactics for zero-based thinking.

Framing The Pieces Together

Here we are talking about synthesis, where actually the real work starts. By now we have analysed everything to little pieces, so we now have to put the pieces together in innovative ways, way our clients have never thought about before.

The way we put the pieces together must outline some aspects of the initial issue we are addressing. Some of the frames are fairly simple, and some of them are more complex. For example look at the extensive use of simple visuals - charts, diagrams - used ion business presentations. One typical example is Stephen Covey’s Important/Urgent matrix. It is simple, but how meaningful and eye-opening it is when you plot your activities on it.

And considering that the brain thinks in terms of pictures, it would be a big mistake to ignore that fact, and base presentations on worlds. You can create a fairly simple visual with a few variables on almost any concept. It serves you in two ways: 1) Your prospects understand what you talk about a lot easier, 2) they can get better involved in the process. All you have to do is to give them some pens and. This method will drastically improve their understanding and increase the level of their commitment for projects.

Humans have three major submodalities: Auditory (hearing), visual (seeing) and kinaesthetic (doing). With this approach you can engage all three. They hear you, see your visual aids and actively participate in modifying those visual aids to their specific situations. There you have prospects fully engaged.

The Use Of Analogies

Analogies are very powerful tools to help clients to understand our ideas. We basically create a similarity between our ideas and the client’s views.

When some prospects are surprised by advanced payment, I tell them the example of a university.

Consulting is like a university course in many aspects. You can only start the course if you pay the tuition first. If you do not pull your weight, you get kicked out. And even if you graduate, there is no guarantee that you get a job. It means, the outcome (graduation and getting a job) depends on both parties. The university gives you knowledge and tools, but it is up to you how much of the given knowledge you are willing to receive and apply. But if you do fail to study hard and apply your that knowledge, you are doomed.

In another example, consulting is like mountain climbing. In order to get to the summit you need to hire a mountain guide, but she is not going to carry you or your backpack. She will slow down if you get tired, but if you are not fit or committed enough to get to the top, you cannot blame your guide, let alone demanding your money back.

It would be the same as hiring a personal trainer, demanding her to exercise and diet on your behalf and passing on the weightloss to you.

Sometimes clients demand excessive amount of content knowledge. You know, when the brain surgeon can only operate on an accountant if the surgeon is an accountant as well. Otherwise how would a surgeon know how to fix an accountant’s brain? It is just plain stupid, but is still conventional wisdom.

I friend of mine was selling Mercedes-Benz in England. An insignificant General Motors dealership turned his application down because he did not have a minimum of 15 years of GM experience. That is amazing. Six years of successfully selling luxury cars in London, UK, was not good enough for an insignificant dealership that is selling scrap metal. (Our perception of GM)

I usually say that it is school kids, not food scientists, who successfully operate McDonald’s all over the world.

And here comes one more thing. Develop visual aids for your analogies. Talking about a concept and showing it simultaneously can be very powerful at communicating your message.

When I want to create large contrast, I use I use the difference between sex education and sex training.

If your 14-year-old daughter comes home from school and says, “We had sex education”, you say that is fine. It is part of the curriculum.

But what do you say when she says, “We had sex training in school”?

Do you ask, “And how many guys did you train personally, honey?” I doubt it. But the example hits people.

Or sometimes clients want to skip the whole marketing (relationship building) process and want to sell right away. This is similar to the difference between building a long-term romantic relationship and a one-night stand with a prostitute. Then I tell clients that going for the instant sale is just like whores selling themselves for the quick buck. It works like being hit on the forehead with a 2 by 4.

Developing A Broad Range Of Perspectives

One upon a time clients put huge value on subject experts but in today’s nipplepiercingly complex business world clients put more value on consultants with broad perspectives.

There is a very good chance that clients have the appropriate subject experts on the payroll, but since they are too involved in the day-to-day running of the company, they simply cannot see the forest from the tree.

Here are some examples. IBM did not lose out on the PC market due to the lack of computer knowledge. Or Chrysler did not almost go to the wall because they did not know enough about cars.

They simply did not have broad perspectives to properly assess the situation. After that mishap both organisations learnt from their mistakes, and have been using extensive consulting help ever since.

Executives must understand one big fact: Good consultants are ahead of their times, and usually this is why they are not employees. People who piss of the status quo-centred establishment with their innovative and cutting edge thinking, usually get eliminated from companies. So, many of them become consultants.

What would it mean to you to have access to this resource goldmine?

Can you see where small business operators shortchange their performance by saying, “I pay my people well, thus I want them to be able to figure out every problem we may face”. How sad. How ignorant. How narrow-minded. How small businessish.

Reflections And Ponderings

Bodybuilders know that training in the gym creates microscopic tears in their muscles (catabolic stage), and it is the resting period that actually builds new muscle tissue (anabolic stage). Zero-based thinking is the same.

You can brainstorm for ideas (catabolic stage), but you may well need some quiet time to reflect on things or on life in general to come up with innovative solutions (anabolic stage). Solitude and inner peace can be very powerful to help you to create not so much solutions to problems, but amazing insights.

Intense activity can trigger our brains and stir up some stuff inside, but when the dust settles, we see what we have never seen before.

Suspending Your Judgement

This is the analysis process and many people make the mistake of judging the situation based on their analyses. However analysis is the first of the three “sis”s. Then comes diagnosis and synthesis.

During the analysis phase we can establish some basic symptoms, but then we must proceed to diagnosis to double-check if we are dealing with the real cause or just some symptoms. Sadly most companies get stuck here and end up addressing symptoms. When sales are down they often hire another sales trainer for one more workshop or another motivational speaker to pump up the gang.

Management fails to realise that most often low sales are caused by changes in the firm’s culture, attitude and atmosphere and to remedy this problem requires more than a sales trainer. So, very often managers decide to go for the quick fix, either by running a quick sales workshop or firing some of the sales staff and hiring new ones. Then the cycle starts again.

Then comes the hardest part. Putting the pieces together in fundamentally new ways. This is the synthesis – and I believe the hardest - part of the game. In comparison to this, analysis is easy. There are not too many ways of absorbing and dissecting raw data.

It is important to suspend our judgement during these processes, so instead of criticising ourselves, we can really concentrate on improvements.

Seeking Patterns, Trends And Commonalities

When you do zero-based thinking, you use both sides of the brain. Both the analytical left-hemisphere and the creative right hemisphere.

You use analysis (to take concepts apart), diagnosis (examining them individually) and synthesis (putting the pieces together). The key is putting the pieces together in a variety of ways.

In a way every concept is like let’s say a boat made of LEGO. You can disassemble the boat into little pieces, and assembling the elements in a different way, you can build something completely different.

The sad fact is that most business and management courses emphasise analytical ability while ignoring diagnostic and synthesis skills. As a result, they keep rebuilding the same boat while trying to cross the desert. Objectives change, but the tool remains the same.

Using Humour

This is a very interesting puppy.

You may have noticed that most highly analytical people do their best to keep humour out of their work environments. They say work and humour do not mix, so they get really serious about work.

But, they also are some of the least innovative, most underachieving and most risk-allergic people. They are extremely left-brained, so the fun and creativity of the right brain is a definite no-no to them.

This is why whole-brained thinking is so important? Watch this baby?

Creativity is basically the number of connections between brain cells.

Let’s say, Webster Sponpule uses all four brain cells of his left hemisphere. The four cells can make maximum six connections. Upon engaging his right hemisphere, two halves of the brain can make a total of 56 connections.

If the number of connections define creativity, is six or 56 better?

Jokes make us think differently as they remind us of different experiences. Use this powerful tool extensively.

Trenchwork

Once upon a time, sometimes in the 19th century, a French diplomat criticised the English for their pragmatism, saying, “It will work in practice, yes. But will it work in theory?”

This is the area where parents (the ultimate consulting profession) have a lot to teach to consultants. Parents understand that children do not need memos, evaluations and reports, but some hands-on help and unconditional love and care. You cannot teach children how to walk by giving them comprehensive reports on walking. You must be there in the trenches with them and actually help them.

Service professionals must understand that the value of their help has nothing to do with the volume of the reports and the number of Powerpoint presentations they generate.

They must be willing to get dirt under their fingernails and help their clients to implement recommendations and make sure that those recommendations actually result in some kind of improvement in the client’s condition.

Summary

The good news is that all this is pretty easy if businesspeople can slow down a bit and start thinking and acting differently. At the end of the day, it is not what you do but how you do it that makes the difference.

Copyright 1997-2008 Tom "Bald Dog" Varjan. All rights reserved. You are free to use this article in whole or in part. One favour though: Can I ask you to you include complete attribution, including a live website link. Also, can you please let me know where you plan to publish the article.

The attribution: This article was written by Organisational Provocateur, Tom "Bald Dog" Varjan of Dynamic Innovations Squad, a firm specialising in helping consulting firms to sell their expertise at the highest margins. Get Tom's free Practice Management Black Paper when you sign up for his monthly newsletter, Commando Consulting: Lessons And Practices From The Ultimate Professional Service Firm, The Military. Visit Tom's website at http://www.di-squad.com.

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