Think Research

Right versus right By Richard Silberman

When two or more business entities come together, one of the biggest challenges they face is determining how they will work together. Whether teams are collaborating on a project, divisions within a company are joining forces, or two corporations are merging or partnering, all parties involved need to agree on how they're going to work or else risk friction, inefficiency and possible failure.

At the core of these risks are differences in business practices, or how an organization conducts its work based on beliefs, assumptions, principles and values. These business practices determine the behavior of people in an organization and are a tangible representation of a company's culture.

Common sense says that everyone needs to agree upon and understand business practices-but few culture transformation or integration methods focus on them. And because everyone comes to the table with his or her own way of doing things (and each side thinks that way is best), achieving consensus is much easier said than done.

Sara Moulton Reger, an expert in organization and culture change at IBM, has developed an innovative new process for organizations to work through cultural issues, agree on business practices, and provide the detail and clarity necessary to put them into action. Known as the Business Practices Alignment Method (or BPA), Moulton Reger's approach is far more rigorous than traditional methods of culture alignment and far more effective at supporting desired business results.

The method's key component is what Moulton Reger calls the "right versus right" concept.

"Transforming a culture or bringing two organizations together creates a clash of viable alternatives--'right versus right,'" Moulton Reger said. "The fact is that when it comes to business practices, there are many plausible ways to achieve a desired outcome. Reconciling them is vital to achieving success."

In any effort, the easy part is eliminating the options that won't work, Moulton Reger explained. The hard part is deciding which of the multiple realistic options is best. BPA provides organizations with a systematic approach for working through the conflicting right ways to do something and ultimately choosing the best practice for a particular situation. The approach then defines those practices in a clear and actionable manner, and then, over time, evaluates their effectiveness.

"We hope this new methodology will convince clients that there is a tangible, objective way to approach culture change efforts," said Moulton Reger.

IBM recently filed for patent protection for the Business Practices Alignment Method, which the company plans to use in its client engagements as well as in its own internal transformation efforts. This significant development in the emerging field of services science evolved out of work Moulton Reger did to integrate PricewaterhouseCoopers Consulting into IBM's corporate culture after its acquisition.

Moulton Reger developed the method with co-inventor Mike Armano while they were with IBM Business Consulting Services (BCS) and then she fine-tuned it during her current rotational stint in IBM Research. A number of other current and former members of BCS contributed to the early foundations of the method, including Michael Lueck, Anthony Harris, Mike Applin, Andrew Stevens, Mike Monday, Carli Kinnear, Wolfgang Raudaschl, Geoff Kitt, Susan Ranft, Elyse Kaplan and Jay Sibel.

The method is beneficial for any organization that needs to transform its culture internally, but it's especially useful when two or more companies need to come together to achieve targeted business objectives.

"Clashes in culture are typically cited as one of the top three-and often the number one-reason that partnerships, alliances, mergers and acquisitions fail to achieve their potential," Moulton Reger said. "This technique is specifically geared to provide a level of clarity that is often neglected in ventures like these. And without it, the efforts are almost guaranteed to underperform."

The power of "right versus right"

The traditional and still commonly used methods for aligning cultures have proven inadequate in many instances because they tend to focus on high level statements that are too vague to put into action. Parties can agree on principles, values or behaviors, for instance, but these are typically abstract and leave room for multiple interpretations. Even when organizations develop "day in the life" scenarios to help people visualize how they are supposed to act, they often neglect telling people how to address difficult problems.

BPA takes traditional approaches to culture alignment and expands on them significantly. Rather than provide vague, high level expectation statements, it explicitly conveys how people are supposed to work in various situations.

The best way to understand the limitations of traditional principle and behavior-based statements and the value of the method-and particularly the right versus right concept-is to consider an example:

Let's say that two companies come together in a partnership and agree that they want to "execute with speed." Everyone's in total agreement that this principle is crucial for success. But what, exactly, does it mean to "execute with speed?" How does one do it?

One company may prefer to execute with speed by giving certain people the authority to make key decisions. The other company may believe its focus on process and role definitions will bring quick and consistent results.

These are perfectly plausible ways to execute with speed, but to work effectively the organizations have to agree on an approach and then put it into operation.

"It doesn't matter which one you choose, or if you craft a way to combine the approaches, but you can't leave it undecided," Moulton Reger said. "That would be an enormous barrier to business results."

Four key steps

BPA has four primary steps that enable businesses to align effectively:

Step 1: Reconcile the right versus right business practice alternatives. The method provides a process for business leaders to assess reasonable yet conflicting ideas and come to an agreement on how they want things done.

Step 2: Apply the business practices that were established in Step 1 to realistic problem situations to develop outcome narratives. The narratives are structured mini-stories that define the desired outcome along with who should do what, and in what way. To work in a consistent manner, employees need a concrete sense of how to put business practices into action.

The method deliberately focuses on dealing with problems rather than routine "day in the life" scenarios. When multiple people need to make decisions and take action to deal with difficult issues, conditions are ripe for delays, conflicts and inconsistencies.

Step 3: Identify the gaps between the way you want things done and the current state. Because the future expectations are defined, an objective, tangible gap assessment can be performed. Then, a prioritized action plan is developed to make changes that will help people work in prescribed ways.

Step 4: Use the defined expectations to evaluate progress towards alignment. Identify areas needing further improvement and take necessary actions until business behavior is aligned the way you want it.

With traditional methods, the definition of the desired changes is often so vague that determining whether the organization is acting in an aligned manner is difficult. Because BPA specifies outcomes that are easy to compare to actual occurrences, it enables objective monitoring and evaluation of progress -which is key to carrying out a successful culture transformation or integration.

The end result: With properly aligned and communicated business practices, employees can focus on doing work and not on wrangling over conflicting approaches. This means that organizations experience fewer episodes of strife and increased productivity. Clear expectations help employees feel less frustration and confusion, and allow lower level employees to feel empowered. All of these benefits help organizations improve their chances of reaching their objectives.

IBM's new focus on services science

This major breakthrough for culture transformation also represents a significant new direction for IBM Research. Moulton Reger has been working at IBM's Almaden Services Research center, which was established 18 months ago to develop methodologies and innovations that can be used by IBM's rapidly growing global services division.

Services science is an emerging area in IBM and beyond, as services now account for about half of both the United States economy and IBM's business. The Almaden Services Research center pulls together researchers such as ethnographers and anthropologists and allows IBM to apply its research prowess to advance theories and techniques that focus on how people and organizations work.

Addressing the human element is fundamental to the success of the technological solutions IBM deploys for its clients," said Jim Spohrer, director of Almaden Services Research. "IBM is making a commitment to bring innovation to services as much as we've done on the product and technology side."

BPA is a prime example of the type of innovations that will come out of Almaden Services Research, and how they will benefit IBM and its clients. The method is particularly relevant as clients embrace IBM's on demand vision, which often involves partnerships with other companies.

"We care about our clients' business results- our relationship with them extends beyond getting their technology up and running," Moulton Reger said. "Our focus on business models and innovative, yet practical methodologies shows that IBM is far more than just a technology provider."