In April 2018 the U.S. Government Accountability Office (GAO) released a report* on shortcomings in the quality assurance (QA) program at the Department of Energy’s (DOE) Waste Treatment Plant (WTP aka the Vit Plant) in Hanford, Washington. QA problems exist at both Bechtel, the prime contractor since 2000, and the DOE’s Office of River Protection (ORP), the on-site overseer of the WTP project.
The report describes DOE actions to identify and address QA problems at the WTP, and examines the extent to which (a) DOE has ensured that all QA problems have been identified and will not recur and (b) ORP’s organizational structure provides sufficient independence to effectively oversee Bechtel’s QA program.
Why do we care about QA? The GAO investigation did not target culture and there is only one specific mention of culture in the report.** However, the entire report reflects the weak nuclear safety culture (NSC) at Hanford.
There is a lot of history here (GAO has been ragging DOE about the need for effective oversight at DOE facilities since 2008) but let’s begin with ORP’s 2012 stop work order to address WTP’s most significant technical challenges. Then, in 2013, ORP’s QA division issued two Priority One findings with respect to Bechtel’s QA program, viz., both the program and Bechtel’s Corrective Action Program to address QA problems were “not fully effective.” (p. 3) This was followed by a DOE Office of Enforcement investigation which, in turn, led to a 2015 Consent Order and Bechtel Management Improvement Program (MIP). The Order specified all corrective actions had to be implemented by April 20, 2016. Currently, 13 of 52 total corrective measures have not been completed and some of the ones where Bechtel claimed completion are not yet completed. In addition, “. . . in some areas where [Bechtel] has stated that corrective measures are now in place, ORP continues to encounter quality assurance problems similar to those it encountered in the past.” (p. 25)
Why doesn’t ORP stop work again? Because ORP senior managers plan to evaluate the extent of Bechtel’s implementation of MIP corrective measures over the next year and have allowed work to continue because they believe Bechtel’s QA is “generally adequate.” (p. 22) We’ll reveal the real reason later.
The shortcomings are not limited to Bechtel. “ORP’s actions have not ensured that all quality assurance problems have been identified at the WTP, and some previously identified problems are recurring.” (p. 16) “When and where problems have recurred, ORP has not always required [Bechtel] to determine the extent to which the problems may affect all parts of the WTP.” (p. 25) Why not? Here’s a hint: ORP’s “Quality Assurance Division is not fully separate and independent from the upper management of the WTP project, which manages cost and schedule performance.” (p. 22)
Our Perspective
An article*** in the local Hanford newspaper summarizes the report’s contents. However, the problems described are not new news. Technical, quality and culture problems have swirled around the WTP for years. In 2011 we started reporting on WTP issues and the sluggish responses from both DOE and Bechtel. Click on the Vit Plant label to see our previous posts.
Goal conflict (cost and schedule vs. QA and a strong NSC) has always been the overarching issue at the WTP. Through fiscal year 2017, DOE spent $11 billion on WTP construction. It will cost approximately $16.8 billion to complete the first phase of the WTP, which transfers low-level radioactive waste to the low-level vitrification facility. No one knows how much it will cost to complete the WTP or when it will be functioning.
GAO gives their subjects an opportunity to respond to GAO’s reports and recommendations. The DOE response is an unsurprising continuation of their traditional rope-a-dope strategy: concur with GAO recommendations, rationalize or minimize the current extent of condition, exaggerate current corrective actions, promise to investigate identified issues and do better in the future, wait for GAO’s attention to turn elsewhere, then continue with business as usual. What DOE needs to do is issue a stop order for the money train—that would get the attention of everyone, especially Bechtel and ORP managers.
How does your QA department stack up? Does it add value by identifying and helping to solve real problems? Is it a distracting irritant, enamored of its own authority and administrivia? Or is it simply impotent?
** “One [ORP] quality assurance expert specified that ORP’s culture does not encourage staff to identify quality assurance problems or ineffective corrective measures. This expert said that people who discover problems are not rewarded; rather, their findings are met with resistance, which has created a culture where quality assurance staff are hesitant to identify quality assurance problems or problems with corrective measures.” (p. 24) This quote exposes the core NSC issue at the WTP.
Ray Dalio is the billionaire founder/builder of Bridgewater Associates, an investment management firm. Principles* catalogs his policies, practices and lessons-learned for understanding reality and making decisions for achieving goals in that reality. The book appears to cover every possible aspect of managerial and organizational behavior. Our plan is to focus on two topics near and dear to us—decision making and culture—for ideas that could help strengthen nuclear safety culture (NSC). We will then briefly summarize some of Dalio’s other thoughts on management. Key concepts are shown in italics.
Decision Making
We’ll begin with Dalio’s mental model of reality. Reality is a system of universal cause-effect relationships that repeat and evolve like a perpetual motion machine. The system dynamic is driven by evolution (“the single greatest force in the universe” (p. 142)) which is the process of adaptation.
Because many situations repeat themselves, principles (policies or rules) advance the goal of making decisions in a systematic, repeatable way. Any decision situation has two major steps: learning (obtaining and synthesizing data about the current situation) and deciding what to do. Logic, reason and common sense are the primary decision making mechanisms, supported by applicable existing principles and tools, e.g., expected value calculations or evidence-based decision making tools. The lessons learned from each decision situation can be incorporated into existing or new principles. Practicing the principles develops good habits, i.e., automatic, reflexive behavior in the specified situations. Ultimately, the principles can be converted into algorithms that can be computerized and used to support the human decision makers.
Believability weighting can be applied during the decision making process to obtain data or opinions about solutions. Believable people can be anyone in the organization but are limited to those “who 1) have repeatedly and successfully accomplished the thing in question, and 2) . . . can logically explain the cause-effect relationships behind their conclusions.” (p. 371) Believability weighting supplements and challenges responsible decision makers but does not overrule them. Decision makers can also make use of thoughtful disagreement where they seek out brilliant people who disagree with them to gain a deeper understanding of decision situations.
The organization needs a process to get beyond disagreement. After all discussion, the responsible party exercises his/her decision making authority. Ultimately, those who disagree have to get on board (“get in sync”) and support the decision or leave the organization.
The two biggest barriers to good decision making are ego and blind spots. Radical open-mindedness recognizes the search for what’s true and the best answer is more important than the need for any specific person, no matter their position in the organization, to be right.
Culture
Organizations and the individuals who populate them should also be viewed as machines. Both are imperfect but capable of improving. The organization is a machine made up of culture and people that produces outcomes that provide feedback from which learning can occur. Mistakes are natural but it is unacceptable to not learn from them. Every problem is an opportunity to improve the machine.
People are generally imperfect machines. People are more emotional than logical. They suffer from ego (subconscious drivers of thoughts) and blind spots (failure to see weaknesses in themselves). They have different character attributes. In short, people are all “wired” differently. A strong culture with clear principles is needed to get and keep everyone in sync with each other and in pursuit of the organization’s goals.
Mutual adjustment takes place when people interact with culture. Because people are different and the potential to change their wiring is low** it is imperative to select new employees who will embrace the existing culture. If they can’t or won’t, or lack ability, they have to go. Even with its stringent hiring practices, about a third of Bridgewater’s new hires are gone by the end of eighteen months.
Human relations are built on meaningful relationships, radical truth and tough love. Meaningful relationships means people give more consideration to others than themselves and exhibit genuine caring for each other. Radical truth means you are “transparent with your thoughts and open-mindedly accepting the feedback of others.” (p. 268) Tough love recognizes that criticism is essential for improvement towards excellence; everyone in the organization is free to criticize any other member, no matter their position in the hierarchy. People have an obligation to speak up if they disagree.
“Great cultures bring problems and disagreements to the surface and solve them well . . .” (p. 299) The culture should support a five-step management approach: Have clear goals, don’t tolerate problems, diagnose problems when they occur, design plans to correct the problems, and do what’s necessary to implement the plans, even if the decisions are unpopular. The culture strives for excellence so it’s intolerant of folks who aren’t excellent and goal achievement is more important than pleasing others in the organization.
More on Management
Dalio’s vision for Bridgewater is “an idea meritocracy in which meaningful work and meaningful relationships are the goals and radical truth and radical transparency are the ways of achieving them . . .” (p. 539) An idea meritocracy is “a system that brings together smart, independent thinkers and has them productively disagree to come up with the best possible thinking and resolve their disagreements in a believability-weighted way . . .” (p. 308) Radical truth means “not filtering one’s thoughts and one’s questions, especially the critical ones.” (ibid.) Radical transparency means “giving most everyone the ability to see most everything.” (ibid.)
A person is a machine operating within a machine. One must be one’s own machine designer and manager. In managing people and oneself, take advantage of strengths and compensate for weaknesses via guardrails and soliciting help from others. An example of a guardrail is assigning a team member whose strengths balance another member’s weaknesses. People must learn from their own bad decisions so self-reflection after making a mistake is essential. Managers must ascertain if mistakes are evidence of a weakness and whether compensatory action is required or, if the weakness is intolerable, termination. Because values, abilities and skills are the drivers of behavior management should have a full profile for each employee.
Governance is the system of checks and balances in an organization. No one is above the system, including the founder-owner. In other words, senior managers like Dalio can be subject to the same criticism as any other employee.
Leadership in the traditional sense (“I say, you do”) is not so important in an idea meritocracy because the optimal decisions arise from a group process. Managers are seen as decision makers, system designers and shapers who can visualize a better future and then build it. Leaders “must be willing to recruit individuals who are willing to do the work that success requires.” (p. 520)
Our Perspective
We recognize international investment management is way different from nuclear power management so some of Dalio’s principles can only be applied to the nuclear industry in a limited way, if at all. One obvious example of a lack of fit is the area of risk management. The investing environment is extremely competitive with players evolving rapidly and searching for any edge. Timely bets (investments) must be made under conditions where the risk of failure is many orders of magnitude greater than what acceptable in the nuclear industry. Other examples include the relentless, somewhat ruthless, pursuit of goals and a willingness to jettison people that is foreign to the utility world.
But we shouldn’t throw the baby out with the bath. While Dalio’s approach may be too extreme for wholesale application in your environment it does provide a comparison (note we don’t say “standard”) for your organization’s performance. Does your decision making process measure up to Dalio’s in terms of robustness, transparency and the pursuit of truth? Does your culture really strive for excellence (and eliminate those who don’t share that vision) or is it an effort constrained by hierarchical, policy or political realities?
This is a long book but it’s easy to read and key points are repeated often. Not all of it is novel; many of the principles are based on observations or techniques that have been around for awhile and should be familiar to you. For example, ideas about how human minds work are drawn, in part, from Daniel Kahneman; an integrated hierarchy of goals looks like Management by Objectives; and a culture that doesn’t automatically punish people for making mistakes or tolerable errors sounds like a “just culture” albeit with some mandatory individual learning attached.
Bottom line: Give this book a quick look. It can’t hurt and might help you get a clearer picture of how your own organization actually operates.
* R. Dalio, Principles (New York: Simon & Schuster, 2017). This book was recommended to us by a Safetymatters reader. Please contact us if you have any material you would like us to review.
** A person’s basic values and abilities are relatively fixed, although skills may be improved through training.
