When I first began working with KaiNexus a long time ago, I was excited to find opportunities to share methods that had been transformative in my own career, particularly Process Behavior Charts (PBCs) and the lessons from Dr. Deming's Red Bead Game. My goal was to help the team adopt a more systematic and data-driven approach to improvement, while avoiding the common trap of overreacting to routine variation in metrics.
A CEO's Perspective: From Science to Business Acumen
Greg Jacobson, MD, the CEO of KaiNexus, captured the impact of this shift beautifully:
“Signal vs. noise–understanding this distinction was one of the most profound changes to my business acumen. I come from a science background. I'm an ER doctor who leads a software company. For more than 25 years, I had competency in reading journal articles and understanding when data met a significant threshold. Being able to take that mindset and apply it to business data allows me to not only understand variations in the system but also frees up my time and sharpens my focus. It allows me to focus on what's important and still keep an eye on a large set of metrics.”
Greg's perspective highlights the power of PBCs: they help leaders like him step out of the reactive mode of managing data, saving time while focusing on improvements that genuinely matter. This mindset shift allows leaders to balance the big picture with the day-to-day metrics that reflect the pulse of the organization.
Teaching Process Behavior Charts
KaiNexus, like many organizations, was tracking a variety of performance metrics and sometimes found themselves reacting to every fluctuation. I introduced Process Behavior Charts as a way to distinguish between signal and noise, which brought clarity and focus to people's decision-making.
For instance, instead of treating a dip in website traffic as a problem or an uptick as a victory, PBCs revealed whether those changes were normal variations or signs of a systemic shift. By focusing only on the signals that indicated meaningful change, the team could save valuable time and energy, directing efforts toward sustainable improvements.
Lessons from the Red Bead Game
We also used the Red Bead Game, a classic exercise created by Dr. Deming, to illustrate how systemic issues–not individual effort–often drive results. This hands-on experience reinforced the importance of improving systems rather than blaming people for outcomes beyond their control.
Here's a photo of me facilitating the exercise with a KaiNexus team in 2018:
For Greg and his team, these lessons were pivotal. It helped them see their metrics in a new light, not just as numbers to manage but as insights into how their processes were performing.
Very often, I hear people giving reminders about not overreacting to a single data point — that's a great habit to have.
Previous Blog Posts about PBCs at KaiNexus
Here are some older blog posts that I've written about Process Behavior Charts at KaiNexus, including some examples and case studies:
Coaching Over Time
Over the years, I've worked closely with KaiNexus to embed these principles into their culture. We've tackled challenges like moving away from vanity metrics and aligning their internal practices with the principles our software promotes.
As Greg noted, adopting these methods has sharpened his focus as a leader. He no longer feels the need to chase every fluctuation in the data. Instead, he can direct his attention to what truly matters, confident that the tools and methods in place will alert him to significant changes when they occur.
Many core KaiNexus business metrics are maintained as “control charts” (another term for PBCs) in our own instance of our KaiNexus software system that we use in-house. I'm glad these charts aren't merely “corporate wallpaper” — they seem to drive insight through the separation of “signal” and “noise.”
Building a Culture of Improvement
What stands out about KaiNexus is the company's ability to embrace these ideas and make them our own. We've not only applied these lessons internally but have also incorporated them into their software, helping other organizations experience similar transformations.
The KaiNexus journey illustrates the profound difference that understanding signal versus noise can make. By freeing themselves from the distractions of routine variation, our founders and other leaders have created a culture that values focus, collaboration, and sustainable improvement.
It's been deeply rewarding to see KaiNexus thrive–not just as a business, but as a model of what's possible when organizations commit to leading better and improving more.
Let me know if you'd like to take your team or you company on a similar journey. Feel free to reach out to me.
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Check out my latest book, The Mistakes That Make Us: Cultivating a Culture of Learning and Innovation:
