The Tale of Two Squirrel Kingdoms (or Peter Drucker vs W. Edwards Deming on management organisation)

Is management in your organisation focused on goals or processes? Which is best? Here’s a fable that illustrates the differences...

A royal squirrel

Once upon a time there were two squirrel kingdoms and their names were Processia and Goalsland. Each squirrel kingdom lived in a very big tree. And each tree stood at opposite ends of a dark and competitive wood.

Processia was ruled by Queen Demingia and Goalsland by King Druck. One autumn when the nuts were ripe and the leaves on the walnut trees were golden the rulers came out into the wood.

Before long, being competitive creatures, the rulers began arguing about who ruled the best kingdom.

‘Processia is the best fed!’, said Demingia. ‘No, it’s Goalsland! We collect far more walnuts than you’, said Druck.

‘I’ll bet you a groat that we have more walnuts to eat this winter than you’, said Demingia. ‘And I’ll bet you a groat that we will have more than you!’. And so they agreed on the bet, even though a groat represented a significant proportion of each kingdom’s total nut revenues.

The next morning the squirrels went out with little sacks which they filled with nuts. They then buried the nuts in the wood. It soon became apparent that each kingdom had its own system for nut gathering and storage.

Processia was most interested in making the process of gathering and storing walnuts as good as possible over time. Each team of squirrels continually worked at making their processes efficient and high quality. Everyone could contribute and they got a bit better every day. If Processia won, the groat would be shared out fairly (probably using 360 degree appraisals).

Goalsland was most interested in giving each squirrel an objective which, if achieved by all, would result in their gathering and storing a record number of walnuts. The plan specified how much each squirrel should gather of a particular quality and how much each should store. They spent long days on getting everything right.

These squirrel objectives were called OKRs, which stood for Onlie Knut Rezults (squirrels are numerate but terrible at spelling). If Goalsland won, the groat would be shared out based on whether OKRs were achieved.

It got colder and there were no walnuts left on the floor of the wood. The squirrels went to their homes at the tippity top of the trees and settled down for winter.

Spring arrived at last. The shoots on the walnut trees were green. Queen Demingia and King Druck came out into the wood.

Demingia was happy: ‘All my squirrels are well fed. Look at their bushy tails!’.

‘We only gathered fine, fat nuts that would keep over the winter,’ said Queen Demingia.

One team of Processia squirrels had noticed that walnuts with black on them were beginning to rot. Black walnuts had thenceforth been rejected for storage by everyone in Processia. This meant they didn’t bury as many walnuts. But they hadn’t wasted time burying ones that would go bad.

‘We also had lots of clever storage places!’, said Queen Demingia.

The squirrels of Processia had kept track of spying birds as they worked. They moved sites a few times as the birds followed them. This meant they buried fewer walnuts. But the ones they did bury weren’t eaten by birds.

I am sorry to say King Druck shed some big tears and said, ‘My squirrels are as thin as twigs!’.

‘We achieved almost all our OKRs. We gathered and stored a record number of walnuts. But we didn’t have as many nuts to eat as we thought!

‘When we made our plan we assumed all walnuts were the same. We didn’t understand the ways in which they might go rotten.

‘We also assumed the birds would be spying on us from their usual places. We had new storage sites. But the birds moved to watch those.’

The squirrels of Goalsland were very keen on achieving their individual OKRs. They were excited about gathering and storing a record number of walnuts. So much so that they didn’t question what was really going on in the wood.

In truth, Goalsland HAD gathered and stored more walnuts than Processia.

But some of them were black and rotten when they were dug up. And some of them were missing, having been eaten by greedy birds.

Goalsland had fewer walnuts to eat over the winter.

And the squirrels of Processia WERE better fed.

King Druck gave Queen Demingia a groat. That evening the squirrels of Processia had bread and milk and blackberries (flown in from Chile given the season) for supper. The squirrels of Goalsland had some camomile tea to settle their rumbly tummies.

To learn more read what Peter Drucker and W. Edwards Deming have to say on management organisation.