The Customer Does Know Best

I'm staying with the "Cake Boss" theme, as there is one more point I'd like to make with the help of the Carlo's Bakery team, before I move on. First, if you haven't read my other post about the bakery, please read in now, so you know what I'm referring to here.

Cakes Parade

During the show you can see Buddy and other members of his family and team refer to the "Carlo's Standard". I think you can get a glimpse of that in this picture of their cake display (which I wish I took). As you can see the cakes are extremely tidy and similar.

In his spin-off show "Next Great Baker", a reality competition to gain an internship at the Carlo's bakery, Buddy had the contestants make the purple cake with the flowers. He had any cake that was not up to "Carlo's Standard" trashed. He trashed cakes because 2 neighbor flowers were the exact same colors (instead of different colors in each tier) or because the dots were not contrasting to the nearest flower. So, I'd say we were talking military precision.

Rehearsal for the Victory Day military parade in St. Petersburg 

In the military parade, by using uniforms and keeping all the details exactly the same, you make individuals look similar and create a single unit. There is, of course, nothing wrong with that. Well, at least if you are in the military and a parade is called for. I'm just not sure how useful a contribution this has for everyday life.

But, I promised we'll talk about customers, not about the merits of putting your cakes on military parade. So, let's get there.


Carlo's Bakery has set itself a standard. Standards are good, I'll be the first to admit that. But they are tools and just like any tool they are good if, and only if, they serve their purpose. If the standard becomes the goal in and of itself, it is no longer useful and it may even become a threat.

How do you decide where to set your standard so it is not so high that it's wasting your resources and not so low that quality becomes a problem? You turn to your customers. Now, in all honesty, customers do not always know best. Often the supplier is the authority on a subject matter, not the customer. But, and it is a great big But, there is just one part of life where the customer is always (and I do mean ALWAYS) right and does know best and no one but the customer is the authority on that subject. That is, of course, the customer itself. If a customer tells you there is no difference between product A and product B then, for all practical matters, A and B are the same. You, as an expert, may be sure these are different but they are not because, as far as the customer is concerned, they are equal in all important parameters. So you must only set your standards to appease your customers.

Consider the Carlo's Standard - would you notice if the color of the dot was similar to the color of the bottom layer of the nearest flower? and if you did notice, would you care? would that make the cake not as good as a cake with a good contrast, in your consumer eyes?

Many professionals start off by setting a high standard that is rewarded by the market. Then, to keep that lead, they keep pushing their standard up. This can work for a while but, eventually, the bar passes the indifference point, the point of satisfacficing and so additional improvement is not valued, or at least not values as much. This improvement still requires investment and so the market turns a cold shoulder to the offer, no longer willing to pay the ever increasing premiums as they no longer see additional value for themselves.

How does this all tie in with Theory of Constraints? easily, just 2 words - local optima. Optimizing, setting standards too high are just examples of local optima. Theory of Constraints holds local optima to be the original sin that leads to reduced performance in goal units.

How would you set your standards to avoid local optima?

The perfectionist's honey trap

Lately I've been watching old episodes of Cake Boss on YouTube. I'm enjoying it because I like cake decorations (I've already fessed up to that), and the show is funny and genuine. For those who have no clue what I'm talking about, Cake Boss is a TLC reality TV show following day-to-day life in Carlo's Bakery, a Hobolen NJ landmark establishment. Of course I also look at the situations from a Theory of Constraints point of view. Seems to me, although it could be just editing, that Dr. Lisa Lang, over at Science of Business, with their Velocity job shop scheduling system and maybe some Critical Chain Project Management skills could come in pretty handy for them. I'd also get his sisters, who run their store, to read "Isn't It Obvious" to get some new ideas about retail and expansion. But, that's not my subject for this post.

The reason I'm bringing this up is the fact that Buddy Valastro, the "Cake Boss" himself, is a self professed "perfectionist". After I brought up the subject of perfectionism Vs. satisficing is my last post, and following some reactions on LinkedIn groups, I started thinking if I can use Buddy as a test case (with all due respect, of course).

First off the bat, before I even dive in, I realize that one man's optimizing can be another's satisficing or it may not even make the bar. So, if you go back to my original Satisficing post, both of my cakes would have met with the inside of the Carlo's bakery trash can. My best is not good enough for them and that's fine. Optimizing and satisficing are subjective and maybe even personal. I write maybe because when your job's on the line the fact that you, subjectively, feel you've done good enough is just not that relevant.

Buddy's a pro, he's really good at what he does and he wants everything to be perfect. This leads, at least on the TV screen, to stress, outbursts, rework, hurt feelings and fear. It also creates a self enforcing loop (remember loops?) in which each time Buddy and his team step up to a challenge, delivering perfect cakes that are bigger, wilder and more impossible, someone (Buddy, his family or a client) comes up with an even harder challenge. Is this necessarily negative? I don't know. There are clearly positive implications, staying ahead of the competition and being interesting enough for your own reality TV show, to name a couple. Then there are clearly negative implications as these projects amplify and generate a lot of the stress, outbursts and stuff I already mentioned (and, yes, I know this can all be just editing).

I think this clearly showcases the honey trap of the perfectionist. Perfectionists always strive for more, for better. While they drive themselves and those around them nuts, they can also come through with amazing results. After all, being the best means doing something that has never been done before, otherwise it can't be The best with a capital T. Think about Nadia Comăneci's 1976 Olympic performance. She scored perfect 10s for her performance then, the first female to ever score a perfect 10 (the score watch did not have the 10.00 option as it was considered impossible). Had this exact performance been repeated now - would it be hard enough, impressive enough to justify the perfect score? Not at all, the bar has been raised. So, the more you strive to deliver, the higher the bar for best and perfect become, not just from you but from anybody delivering these types of outputs. So, to stay the best you have to do more and then even more. It's a never ending cycle, with all the positive and negative implications. Is it worth it? in the Olympics? Sure, in the business world? Maybe not.

I have an idea on how to break the loop with help from the customers themselves. It needs some thinking, but if you want me to work on it - press the Like +1 button and I'll know.

Satisficing and the Siren's Song - Same or Different?

In a post about avoiding change I shared my experience and presented the concept of the "siren". I then recalled a much older post about Satisficing. At first there seemed to be a contradiction. I mean, how can I tell you not to fall for the spell of the siren while I'm the one telling you to be a satisficer? Seems like double standard, but it isn't. So, I figured clarification is in order.

First off, let's recall the overcoming resistance to change video, where change is basically compared to climbing a mountain to reach the "pot of gold". I'll use mountain climbing to explain my point, then. So let's agree that we set our goal to be climbing up a very tall mountain. Not a very hard mountain, no tricky technique needed, it's all just walking up a mountain. That's not to say it won't be hard. The elevation is high and there will be oxygen considerations, for example.We have defined what we want to achieve - we want to reach the highest peak of the mountain. our pot of gold is quite clear then, the sense of achievement.

Kilimanjaro

Now that we have our goal set out and defined well we make a plan - we need to get in shape, train, learn the necessary skills, purchase equipment. There is stuff to be done, targets and milestones to achieve in the quest to the top of the mountain.

The optimizer will go into analysis paralysis quiet early in the process. This character will do a full research on everything - tents, sleeping bags, garments, training protocols. The need is to know what is the best of anything and everything. Time goes by and there is no progress because things aren't perfect. How can you start training if you don't know what is the best protocol and what is the best nutrition? When, at last, things do start happening they are slow because everything has to be perfect. You can't move to the next stage or the next piece of equipment until you get this stage or this piece just right. When climbing the mountain, anything but getting to the very top will be considered a failure for this type. Even if the "pot of gold" has been discovered, the peak must still be conquered, and an exhaustive search must be undertaken to ensure that the pot of gold is THE pot of gold and there is no other, better, pot.

The satisficer will move quite briskly through the paces. The targets are there for a reason and that reason defines the bar to achieve. So if a tent is called for, it's because sleeping out at night will be cold on the mountain, so a tent good enough for the expected temperatures is needed. Find out a good source of knowledge about tents, get an answer which is good enough for these temps and get a tent, on to the next task. Is this the best tent there is? Who cares, It is good enough, it'll do the job needed. Training will be handled much the same way. Each phase is there for a reason, a certain bar that must be attained. Once you reach that bar, the fact that more can be achieved is not a hurdle. The satisficer may try to improve the result, but it is not imperative so if there is time for more training it will be done, but if there is not, no problem. Then, on the mountain, this type will have a point where, having gone this far, finding a pot of gold, she will feel accomplished. So, while going all the way to the top is an appealing option, she will have no problem finishing the climb earlier if need be. When I prompt you to be a satisficer, this is what I'm talking about - go for good enough.

A person under the spell of the siren song will do nothing, no preparation, no training, no climbing. This person will want to reach the summit, will envy those who do and even those who try. Still, nothing will be done. The current situation seems safe and comfortable. So even though there is a desire, no effort is put forth, not even a little try, one that comes at basically no risk. No looking at equipment, no training that's good for your health anyways. Nothing. Not even climbing a small hill, just for fun. This person is stuck in the "comfort" of the bland current situation - settling for far less than possible.

It is clear now that the satisficer is not under the sirens spell. The satisficer makes change happen and balances effort with reward, leaving the optimizer and those listening to sirens song far behind.

I have more ideas on this subject but first I'd like to know can you relate to this? let me know what you think and subscribe to get more post from this blog.

Satisficing

Theory of Constraint talks a lot about avoiding local optima, about maximizing the system and not its parts. This leads to road runner ethics, to making sure we are not trying to be more accurate than the noise in the system and so forth. The Theory of Constraints solutions tell us what to do at a good enough granularity. The rules are simple. Don't protect every step, protect the system by protecting the constraint, maintain flow. The tools are there. DBR and sDBR, CCPM, Logistics. So what's the problem?

The problem is there is still a void, although it seems to be just a verbal one. If we are not optimizing, if we are not "doing the best we can", than what are we doing? We can't just brush this off as being "just a verbal thing, just definitions", definitions are the starting point of clear thinking, as Dr Goldtratt taught us repeatedly.

There is another reason that makes this important. While the human logic can accept fuzziness, our subconsciousness can't, and that's where it counts the most, since most of our decision making is actually done there, at the most instinctive level. There are no voids in the subconscious mind and there are no gray areas. Like Master Yoda said in one of the Star War movies: "Do, or do not, there is not try". That's your subconscious mind for you.

So, for our subconscious mind not "doing the best we can" is, actually "not doing the best we can" or, if we'll put English grammar aside for a second, "doing NOT the best we can". Which sounds bad, doesn't it?
So, we really need a good name for not optimizing. That name, to me, should be "satisficing", a term I first heard during my MBA from Prof. Boaz Ronen, a TOC disciple in the academic world.
Satisficing means being good enough, not perfect. It has lots of merits. It reduces "analysis paralysis" and stress levels, allows for better flow through faster outputs  (I demonstrated this while discussing the hiring process here) and it sounds good.

What do you think?

Edited to add:
Following the replies I got here and on LinkedIn, I guess satisficing needs a bit more elaboration. Here's an easy example - say I have to prepare a birthday bash for a 6 years old and my goal is to make that 6 years old as happy as possible. I know I'll make a chocolate cake, cover it with chocolate cream and decorate it. Once the cake is ready I can make this cake:   decorated with M&Ms and a sugar paste "Happy Birthday". Time invested is about 1 hr and child is very happy.

On the other hand, I can make this cake: covered with sugar paste and decorated with sugar paste designs. Time invested 4-5 hrs (at least) and child is very happy, perhaps a bit more than with the first cake but not significantly so.

Both cakes are eaten up at about the same rate.


(yep, I made both of these cakes, and other "optimizer" cakes you can see here.There is room for hobbies in this wold, IMHO)

What we see is that I can go for a satisfactory cake or an optimal cake. The result, in goal units of child happiness, will not vary substantially, the only difference is the effort I put in. The first cake demonstrates satisficing - doing the necessary, the sufficient and nothing over that. The second cake demonstrates optimizing - doing the necessary, the sufficient and everything else, trying to be perfect.

One last thought (Thanks Henry for bringing it up) - whatever you do, it has to move you in the right direction. It is not enough to "do it right", you have to "do the right thing right"

I'd love to hear what you think about this.

TOC for hiring part 2 - Sorting through the CVs

From a TOC point of view handling the classical hiring process (advertise opening, get CVS, sort, interview, hire) is entirely an operating expense (OE), it does not create any throughput, even though the end goal of the process is, indeed, an increased throughput. Then at the end of the process what you get is "marriage after a blind date", with neither sides really sure if the right decision is being made. Taking that into consideration – perhaps there is place for paradigm shift in hiring.

But assuming we have to use the current process – how can we minimize the impact it has on out throughput? As always – it is done step by step.

So, once a company announces an opening it will receive candidate CVs and most of the times it will receive a lot of CVs, much more than needed to create a meaningful selection. We can divide these CVs into three basic groups:

• The "No-s" – these CVs present candidates that are clearly not relevant when compared to the defined characteristics for a good enough candidate (as discussed here)
• The "Yes-s" – CVs that represent candidates with good fit to the defined characteristics
• The "Maybe-s" – CVs that are not clear cut, perhaps there is great fit in some of the defined characteristics but not in others, perhaps something else is creating doubt

How to treat the "No-s" and the "Yes-s" is clear, assuming there are enough CVs that are not "No-s". So the only problem is the "Maybe-s". This should not be a problem, if we look at the situation from a satisficer point of view. First these should only be considered after the "Yes-s" have been exhausted.

Once it is clear that there is need to go into the "Maybe-s" pool, the first step would be to re-analyze them. There is more data and knowledge in the system now, so perhaps some of these are actually "Yes-s" or "No-s" and should be treated accordingly. Then process them in order from the most promising to the least promising. Stopping as soon as possible (when the position has been manned, there are enough eligible candidates to move to next phase etc.)

One point to keep in mind is that often times bias leads to wrong decisions in hiring. This does not have to be the "regular suspects" of bias such as gender, race, religion and so on. There can be many hidden assumptions about the position, the appropriate candidate and so on that will lead to bias.

Using TOC for a hiring process

Let us begin by defining the goal of the process as finding a good enough candidate for the job. This is how a "Satisficer" would look at this. An "optimizer" will look for the best candidate possible and thus will take much more time and effort to fill up the opening – is this beneficial for the organization? I dare say it is not, since not only is the job open for a longer time, meaning that required output is delayed, the recruiting team also spends more time on this task and thus is not available for other tasks.

To recruit a good enough candidate you first must define the characteristics of a good enough candidate. It is important to keep some slack in these definitions to allow for variability between candidates, so recruiters have a real choice. In order to get a good understanding of necessary characteristics, just get a good understanding of the job this candidate will be doing.

Adding a person to the company's staff is a process of change and should be handled like such (as discussed here). Hiring managers should consider all 4 quadrants of this change first at the general level of hiring someone and then at the specific level of hiring a certain candidate. Throughput considerations should be used.

At the general level consider:

	+	-
Hire new person (change)	"Pot of Gold" - increased throughput by manning position	"Pain" – losing throughput by paying more salaries (increasing OE) without sufficient return
Don't hire (don't change)	"Mermaid" – low OE, business as usual, no need to train and bring someone up to speed….	"Alligator" – overloaded workers, missing capabilities….

This would be valid even when the manager leading the process is very willing to hire the new person. Also notice that these are very generic possibilities and should be replaced with the specifics of each situation in real life.

At the specific level each candidate is different so a generic analysis is not relevant. One point to consider, though, is how would the analyses differ between a candidate that is an acceptable fit on all parameters and one that is a very good fit on some parameters but poor on others. Which parameters are the most important to your throughput?

Continued here