The Capabilities Trap with Simon Jagers
Welcome Simon back to the podcast. Simon is the founder of Samotics and has been involved in technology throughout his Career. Today we will talk about capabilities trap. Although briefly, tell us more about you:
Involved with technology, our guest focuses on: machine learning, and the conversion of data into information.
In this episode we covered:
- What is a capabilities trap?
- It basically refers to sacrificing everything for the short-term, right?
- Why should we be aware of capabilities trap? How do we manage it?
What is a capabilities trap?
Despite its inherent operational and financial benefits, technology is sparingly adopted across all industries. Prof. John Sterman explains this in the article “The Capability Trap: Prevalence in Human Systems”. Briefly, the articles states;
- Production capacity depends on capabilities and the number of hours used.
- Capabilities refers to the quality of the tools and the skills of the people in the process.
- The trap begins when there is demand for high output for a short-term achievement-the team then starts to put in more hours, reduce maintenance activities, compromise on safety and quality, and reduce training hours.
- The long-term goals are thereby compromised because capabilities start to erode and performance eventually drops.
It basically refers to sacrificing everything for the short-term, right?
Yes, because unlike investing in long-term improvement processes (training, technology, maintenance), there are immediate short-term gains. Besides, investment in these improvement processes has a “worse before better” phase. Sometimes the benefits might arise but it will be difficult to conclusively link them to the investments.
Why should we be aware of capabilities trap? How do we manage it?
Neglecting capabilities trap will result in reduction of production capacity over time. Machines will fail, the organization will fall back in terms of technology, and people’s skills will erode. If you opt for these improvements, you must be willing to withstand the “worse before better” period. Though it is a challenge because managers are judged on short-term gains.
How do managers create a balance between being judged on short and long-term gains?
- Manage expectations- take the long-term view and not expect an immediate turn around in the initiatives.
- Pay attention to the maintenance KPIs
- Plan for the long-term
- Invest in capabilities that can be executed both in good and tough times.
- Even in a reactive maintenance environment, set aside some time (even 2hours per week) to focus on long-term investments.
What does capabilities trap mean to maintenance innovation technology?
Investment in technology has a lot of benefits but you shouldn’t always expect immediate returns. After a new technology is adopted performance will drop in the learning period.
In reliability, you must focus on the end result while capitalizing on the present opportunities. Pay attention to the technology; some can do one thing well (isolated tech) but not fit in the system in pursuit of the goal.
Have a clear road map because the more the complexities the more capabilities trap will manifest. If it gets too complex, desire for immediate performance rises and people sacrifice the long-term goal.
We call it the “value of despair”-trying to adopt new systems but people are still stuck in the old culture and eventually performance drops.
People often blame culture because it cannot be quantified to reveal culpability in the team. Prof. Sterman takes a systems modelling approach to explain the performance drop; If you work longer hours there will be no time to innovate. Consequently, your capabilities will erode.
Although we cannot quantify culture, it has a direct influence on organizational performance.
How do we overcome the capabilities trap?
- Long-term planning and vision – clear roadmap; calculate a realistic business case for the technology.
- Focus on the needed technology and make it scalable.
- Build and ecosystem of technology partners.
- Drive transformation from the top.
- Most importantly Acknowledge the “worse before better” phase and to avert it; invest in technology with a long time frame but daily useful.
- Have a shared understanding of the roadmap and invest in relationships.
Have you seen the results of ignoring the capabilities trap?
Yes. At a personal level; opting to work harder when things do not work out instead of being smart about it. Also, USA Airlines opted to lay off its skilled workers to cut costs during the pandemic but now travels have resumed and their ratings are plummeting.
What is the key takeaway?
Expect the “worse before better” phase in adoption of technology. Take the long-term view to help through it.
Simon Jagers Links:
- Samotics on Twitter (https://twitter.com/samotics)
- Samotics on Linkedin (https://www.linkedin.com/company/samotics/)
- Past Simon Jagers Episodes
- How to Save a Leaky Ship
- Book: Where Good Ideas Come From by Steven Johnson
- Book: What Technology Wants by Kevin Kelly
- Book: Abundance: The Future is Better Than You Think by Peter Diamandis
- 269 – The Capabilities Trap with Simon JagersJames Kovacevic
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