Day 1: The Matrix of Management

Welcome to the Real World

In the sci-fi dystopic movie, The Matrix, Morpheus tells Neo: "The Matrix is everywhere. It is all around us... It is the world that has been pulled over your eyes to blind you from the truth." Morpheus then offers to show Neo the real world by unplugging him with a program that looks like a red pill. And so he tumbles down a rabbit hole...

For managers and leaders, there's a similar matrix—a set of deeply embedded practices and beliefs that seem obviously correct but actually obscure reality and undermine the very results we seek.

Dr. W. Edwards Deming, a statistician and physicist, spent decades helping organizations see through this illusion. He observed that most managers operate within a system of thinking that creates the problems they're trying to solve. Like Neo before taking the red pill, they can't see it because they're inside it.

This book is for people who are living under the tyranny of the prevailing style of management. The huge, long-range losses caused by this style of management have led us into decline. Most people imagine that the present style of management has always existed, and is a fixture. Actually, it is a modern invention--a prison created by the way in which people interact. This interaction afflicts all aspects of our lives-government, industry, education, healthcare.

W. Edwards Deming. The New Economics for Industry, Government, Education (2nd Ed. p. xv, 3rd Ed. p. ix)

The faulty practices Deming identified aren't just ineffective—they're counterproductive. They create the opposite of what we intend:

• We rank employees to motivate and reward performance, but destroy cooperation, teamwork, and learning
• We set numerical targets to drive results, but incentivize gaming the system, destroying it for the bargain
• We manage by over-prioritizing visible figures, ignoring the intangible unknown and unknowables that need to be accounted for to improve

It is interesting to note that the prevailing system of management has been created by best efforts, without the knowledge that we shall learn in later chapters. We pause here to ask what is the effect of

Hard work? Best efforts?

Answer: We thus only dig deeper the pit that we are in. Hard work and best efforts will not by themselves dig us out of the pit. In fact, it is only by illumination of outside knowledge that we may observe that we are in a pit.

W. Edwards Deming, The New Economics for Industry, Government, Education
(2nd Ed, pp. 22–23; 3rd Ed, pp. 17–18)

Over the next seven days, you'll learn to recognize these artificial constructs and discover a radically different way of understanding your organization—one based on systems, variation, knowledge, and human psychology.

Reflection Questions

1. What management practices in your organization feel like "the way things are done" but don't seem to produce the results you want?
2. Are you ready to question fundamental assumptions about how organizations work?
3. How would you describe your theory of management to a new hire? What principles and practices guide the way you see, think, and act?

Today's Challenge

Notice one common management practice today. Ask yourself: "What is this practice actually optimizing for? Does it achieve that goal?"