Balancing Processes

BALANCING PROCESSES: DISCOVERING THE SOURCES OF STABILITY AND RESISTANCE

If you are in a balancing system, you are in a system that is seeking stability. If the system’s goal is one you like, you will be happy. If it is not, you will find all your efforts to change matters frustrated—until you can either change the goal or weaken its influence.

Nature loves a balance—but many times, human decision makers act contrary to these balances, and pay the price. For example, managers under budget pressure often cut back staff to lower costs, but eventually discover that their remaining staff is now overworked, and their costs have not gone down at all—because the remaining work has been farmed out to consultants, or because overtime has made up the difference. The reason that costs don’t stay down is that the system has its own agenda. There is an implicit goal, unspoken but very real—the amount of work that is expected to get done.

In a balancing (stabilizing) system, there is a self-correction that attempts to maintain some goal or target. Filling the glass of water is a balancing process with the goal of a full glass. Hiring new employees is a balancing process with the goal of having a target work force size or rate of growth. Steering a car and staying upright on a bicycle are also examples of balancing processes, where the goal is heading in a desired direction.

Balancing feedback processes are everywhere. They underlie all goal-oriented behavior. Complex organisms such as the human body contain thousands of balancing feedback processes that maintain temperature and balance, heal our wounds, adjust our eyesight to the amount of light, and alert us to threat. A biologist would say that all of these processes are the mechanisms by which our body achieves homeostasis—its ability to maintain conditions for survival in a changing environment. Balancing feedback prompts us to eat when we need food, and to sleep when we need rest, or to put on a sweater when we are cold.

Body-temperature regulation is a familiar example: feedback helps bring temperature back toward a range the body can sustain.

Organizations and societies resemble complex organisms because they too have myriad balancing feedback processes. In corporations, the production and materials ordering process is constantly adjusting in response to changes in incoming orders; short-term (discounts) and long-term (list) prices adjust in response to changes in demand or competitors’ prices; and borrowing adjusts with changes in cash balances or financing needs.

Planning creates longer-term balancing processes. A human resource plan might establish long-term growth targets in head count and in skill profile of the work force to match anticipated needs. Market research and R&D plans shape new product development and investments in people, technologies, and capital plant to build competitive advantage.

What makes balancing processes so difficult in management is that the goals are often implicit, and no one recognizes that the balancing process exists at all. I recall a good friend who tried, fruitlessly, to reduce burnout among professionals in his rapidly growing training business. He wrote memos, shortened working hours, even closed and locked offices earlier—all attempts to get people to stop overworking. But all these actions were offset—people ignored the memos, disobeyed the shortened hours, and took their work home with them when the offices were locked. Why? Because an unwritten norm in the organization stated that the real heroes, the people who really cared and who got ahead in the organization, worked seventy hours a week—a norm that my friend had established himself by his own prodigious energy and long hours.

To understand how an organism works we must understand its balancing processes—those that are explicit and implicit. We could master long lists of body parts, organs, bones, veins, and blood vessels and yet we would not understand how the body functions—until we understood how the neuromuscular system maintains balance, or how the cardiovascular system maintains blood pressure and oxygen levels. This is why many attempts to redesign social systems fail. The state-controlled economy fails because it severs the multiple self-correcting processes that operate in a free market system.[10] This is why corporate mergers often fail. When two hospitals in Boston, both with outstanding traditions of patient care, were merged several years ago, the new larger hospital had state-of-the-art facilities but lost the spirit of personal care and employee loyalty that had characterized the original institutions. In the merged hospital, subtle balancing processes in the older hospitals that monitored quality, paid attention to employee needs, and maintained friendly relationships with patients were disrupted by new administrative structures and procedures.

Though simple in concept, balancing processes can generate surprising and problematic behavior if they go undetected.

In general, balancing loops are more difficult to see than reinforcing loops because it often looks like nothing is happening. There’s no dramatic growth of sales and marketing expenditures, or nuclear arms, or lily pads. Instead, the balancing process maintains the status quo, even when all participants want change. The feeling, as Lewis Carroll’s Red Queen put it, of needing “all the running you can do to keep in the same place,” is a clue that a balancing loop may exist nearby.

Leaders who attempt organizational change often find themselves unwittingly caught in balancing processes. To the leaders, it looks as though their efforts are clashing with sudden resistance that seems to come from nowhere. In fact, as my friend found when he tried to reduce burnout, the resistance is a response by the system, trying to maintain an implicit system goal. Until this goal is recognized, the change effort is doomed to failure. So long as the leader continues to be the model, his work habits will set the norm. Either he must change his habits, or establish new and different models.