The following is another in a new series of columns that will provide answers to small business questions. The new question and answer column is written by Dr. Leonard Bertain, Ph.D., the president of The Bertain Consulting Group of Oakland, CA a consulting firm specializing in the improvement of business processes and business re-engineering. Dr. Bertain's book, "The New Turnaround", contains a fictionalized character known as "Dr. Elbie". Should you have a question regarding business management issues, write or fax them to Dr. Elbie, Bertain Consulting Group, 3758 Grand Ave., Suite 25, Oakland, CA 94611, phone (510) 653-6355 or lbertain@bertain.com Dear Dr. Elbie: I heard you mention, in a class that I attended at the UC Berkeley Extension, something about a new approach to business that you labeled, "The Scientific Paradigm." Would you care to elaborate? Interested in Menlo Park. Dear Interested: I definitely would. As I mentioned in class, I developed a business analysis process which I call "Value-added Analysis Process", VAP for short. I felt very uncomfortable describing VAP as a TQM program. It certainly accomplished the objectives of TQM programs but I felt that VAP was more comprehensive than TQM. TQM as the name implies is involved with creating an organization based on the principles of quality, ie, delivering product or value to meet the customer's needs. That is certainly a worthwhile objective. But TQM falls short in the financial arena, in general business strategy, in product development, and in technology issues. TQM is a fine paradigm for a business but it stops short of more lofty objectives. There is more to business than quality and process. Let me explain. I was trained in my undergraduate and graduate school training to understand the workings of the Scientific Paradigm. Scientists are trained in the Scientific Paradigm. But now I am working as a consultant in the world of business. It it not surprising then that I bring my scientific training to bear on not only in the way that I solve problems, but my whole mindset and understanding of the basic truths of business are guided and controlled by the way I look at problems. I solve problems from the perspective of the rules of the Scientific Paradigm. When I look at strategy or new ideas, I treat them as ideas or approaches to business and no more. I don't worship the strategy nor do I allow my clients to put strategy into concrete terms. The strategy for a business is a path to follow, it is a theory about how one might approach a market, it is a new way of thinking about a market, but it is not a direction that should be etched in concrete. It is like a scientific theory, it stands on its own merits. The data of the market either support the strategic path or they don't. But the Scientific Paradigm is more than about strategy, it provides a whole new way of dealing with change. Change and radical new ideas are part of Science, they are inevitable, as well they should be in business. Change is part of the Scientific Paradigm that tells us that no theory is perfect and that it must be continually examined for appropriateness to the data that is collected by scientists. We do that in business as well. In fact, Drucker, in his recent article in the Harvard Business Review, (Sept-Oct. - 1994, p. 95) tells managers that they must continually evaluate the assumptions of the business. He goes on to say that these assumptions fall into three categories: 1. assumptions about environment, mission and core competencies must fit reality. 2. these assumptions must fit one another. 3. these assumption must be tested constantly. In Science, we continually test the mission of our research and core capabilities against competitive researchers, i.e., labs in the same discipline working on the same problems. While working in the discipline we both test the assumptions against what we feel is our understanding of how theory describes nature, and we continually challenge all the assumptions to insure that they fit one another. Why do we care about all of this? Very simply because we believe that this whole concept is rooted in the idea that organizations resemble the systems of nature and that there is a strong basis of analogy to link the actions of science that describe nature with those of management systems theory that describes business. We look at the Scientific Paradigm as an approach to business which recognizes that organizations are structures that mimic systems in nature and are therefore guided by the same rules. We believe that when we understand one universe we can use that understanding to understand the other. In this context, the Scientific paradigm provides a set of lenses that allow us to view the business world from a perspective of modern science. The lens of the scientific paradigm provides a view of the world that influences the way we observe and interpret information and allows us to look at business problems using much of the same insight that guides our thinking about science. We conclude by noting an argument given by Laurie Fitzgerald, a consultant active in this area when she says: "It should go without saying that one cannot expect to successfully steer a dynamically complex system moving at accelerating speed through a fiercely competitive and ever-changing global marketplace without an adequate grasp of how and why our organizations are the way they are and behave the way they do." And we think that the Scientific Paradigm helps us understand how organizations work but it also helps us think about problems from a different perspective. I will spend some time in the next column discussing some of the analogies from Science that help us understand business, business change, and profit improvement. Dr. Elbie's Corner is copyrighted by Leonard Bertain, 1995, 1996, 1997, 1998. Dr. Elbie's Corner is a monthly article published by the Bertain Consulting Group, in the CEO University Website @ Bertain.com or CEOU.com. This article is reprinted from October 1996.