The Black Ecconomy
When you work in a large company, one of the things you hear quite often is “we have to follow the process”. Large companies, for very good reasons, have a need to standardise their processes. If you have 50,000 staff, having one way to do things makes a lot of sense. No matter where someone goes in the organisation, the process for ordering a new pen, or whatever, will be the same. The problem with defined processes though, is that unless they are regularly reviewed and cleaned up, they tend to accumulate complexity. Each time something happens that is just outside the normal way the process works, someone will add some extra checks into the process to make sure that that situation is now covered. Over the years it will collect enough of these extra checks that your carefully considered and streamlined pen ordering process now requires a 10 page form, 15 signatures and about 4 hours (and in some companies a pint of cockerel’s blood). The end result is that everyone spends all day looking for pens.
Our teams are stuck following these complex processes (which for the Lean folks out there equate to waste number 7 – Extra Processes) and the delays caused can significantly impact agility. How can a team release every 2 week sprint if following the release process will take 2 months? But the process is the process… we have to follow it. Or do we? Look closer at your teams. Sure, on the surface the process is being followed, but look under the surface. How did Fred manage to get that test environment set up weeks ahead of schedule? How come Joe always has enough pens when requisitioning a new one takes weeks? Welcome to the black economy.
Whenever things are artificially scarce and expensive, a thriving black market appears selling things cheaper. The cost of process complexity is time. The process black market sells things cheaper than the official process so the black market gets things done faster.
So how does the black market work? In secret but at the same time out in the open. Everyone knows it's there but it gets ignored (except for the corporate KGB – the process auditors). You can’t just walk into a black market shop and buy what you like though, it's still illegal so you have to have connections. You have to know who to go to to get stuff done. This is where the guy like Joe, the one with all the pens, is invaluable. They know the right people. They have access to the market.
The black market is built up from personal connections. Joe doesn’t need to fill in the pen ordering form; he knows the person who has the key to the cupboard and goes and asks them. Fred knows the environment manager and goes out for coffee with the server admins so he can just ask nicely. They trust him because of their personal connection and will pull some strings for him.
Although the official process is the way things are supposed to be done, it's the black economy where most things actually get done. In a way, this is fundamentally agile - individuals and interactions over processes and tools. But there are some down sides.
The biggest down side is that if the process is is too complex, no one follows it and you are back to an adhocracy so all that standardisation and efficiency you were aiming for gets lost. The other big problem is that the black economy can cut a few corners. If what you are doing is low risk then this may not be a problem. Maybe your website will have a glitch for a while if a production bug gets through. But if the stakes are higher, say in the financial or healthcare industries, a bug getting through can be disastrous. You may have just given someone the wrong drug or taken down a nationwide ATM network. Not good.
The trick is to keep an eye on your processes, and on the black economy. If the black economy becomes the main way to get things done, it's time to take a look at the process and simplify it. After one of their shuttle accident reports, NASA stripped 250,000 pages, (yes, two hundred and fifty thousand) out of the "get the shuttle ready for launch" process. The official process had become so unwieldy that the black economy took over and some key checks and balances went missing.
All processes need to be regularly maintained to stop them from collecting complexity. The trouble is, a process overhaul is a big and expensive exercise, so no-one wants to do it. The secret is to give the maintenance of process to the people who use the process day to day. Let them build it around the way their interactions actually happen.
Also, don't restrict them to a maintenance schedule. Give them permission to continually tinker with the process. That way, the process continually evolves in small steps and you don't end up with those big, expensive, major process overhauls.
It's like gardening. If you keep up with the maintenance, it only takes a few minutes a week. If you leave it for a year, it's going to be a solid weekend's backbreaking labour to get it all back into shape. Which means that you aren't likely do do it, so the weeds get bigger and we are now looking at a week's solid work to get it back under control... and so on. I have a vegetable garden... ask me how I know this.
So, keep up with the process gardening. That way you get the best balance between standardised process and the agile concept of individuals and interactions over processes and tools. Now... does anyone have a pen I can borrow?