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Day 6 of 7

Unplugging from the Management Matrix

Day 6: Lens Three—Theory of Knowledge

"I Can Only Show You the Door. You're the One Who Has to Walk Through It."

Morpheus can't give Neo knowledge. Neo must develop it through experience guided by theory. This is exactly what Deming means by Theory of Knowledge—understanding how we learn and improve.

Most organizations don't learn. They copy.

They see a successful company and imitate their practices without understanding the underlying principles. They implement "best practices" without knowing why they work (or whether they'll work in a different context). They react to data without having a theory to explain it.

Deming's insight: Without theory, there is no learning. There is only copying, imitation, and random trial and error.

What is a theory?

A theory is a framework that:

  • Explains why something happens
  • Predicts what will happen under different conditions
  • Can be tested against experience
  • Evolves when predictions don't match reality

The cycle of knowledge:

  1. Start with a theory (prediction about what will happen and why)
  2. Test it (Plan-Do-Study-Act)
  3. Compare prediction to reality
  4. Revise theory
  5. Repeat

This is the foundation of the PDSA Cycle (Plan-Do-Study-Act):

  • Plan: What do we predict will happen, and why? What will we test?
  • Do: Carry out the test on a small scale
  • Study: What did we learn? How does reality compare to prediction?
  • Act: What changes should we make to our theory? What next?

Why "Study" not "Check"?

Many people use "PDCA" (Check). But "Check" implies you're just verifying the plan worked. "Study" recognizes you're learning—sometimes the plan works, sometimes it doesn't, but either way you gain knowledge.

Without theory:

  • "Our sales are down" (okay, but why? what's your theory?)
  • "This best practice worked at Company X" (okay, but why? will it work here?)
  • "Let's try this and see what happens" (okay, but what do you predict? how will you know if you learned anything?)

With theory:

  • "I predict sales are down because of X, which should also show up as Y. Let's test."
  • "This practice worked at Company X because of these conditions. We have/don't have those conditions, so I predict..."
  • "Based on our understanding of the system, if we change X, I predict Y will happen because Z. Let's test on a small scale."

The profound shift: Management becomes less about having "the answer" and more about having better theories, testing them, and continuously learning.

Reflection Questions

  1. When was the last time you made a change based on a theory you could articulate? What did you predict would happen?
  2. When you copy a "best practice," do you understand why it works? In what contexts? What theory explains it?

Today's Challenge

Choose a problem you're facing. Write down:

  1. Your theory about why it's happening,
  2. A prediction about what would happen if you made a small change,
  3. Create a small test you could run to learn what would happen.