Business Today – 21 April 2001 – Nut Island Effect: When Good Teams Go Wrong

The Nut Island Effect

When Good Teams GoWrong

They were hardworking, uncomplaining, and dedicated beyond the call of duty. Yet the extraordinary team that ran a vital wastewater treatment plant actually brought about disaster. How could such well-intentioned people produce such perverse results? They fell prey to an organizational pathology that can strike any business.


They were every manager’s dream team. They performed difficult, dirty, dangerous work without complaint they put in thousands of hours of unpaid overtime, and they even dipped into their own pockets to buy spare parts. They had tremendous esprit de corps and a deep commitment to the organisation’s mission.

There was just one problem: their hard work helped lead to that mission’s catastrophic failure.
The team that traced this arc of futility was the 80 or so men and women who operated the Nut Island sewage treatment plant in Quincy, Massachusetts, from the late 1960S until it was decommissioned in 1997. During that period, these exemplary workers were determined to protect Boston Harbor from pollution. Yet in one six-month period in 1982, in the ordinary course of business, they released 3.7 billion gallons of raw sewage into the harbor. Other routine procedures they performed to keep the harbor clean, such as dumping massive amounts of chlorine into otherwise untreated sewage, actually worsened the harbor’s already dreadful water quality. How could such a good team go so wrong?

This question goes to the heart of what I call the Nut Island effect, a destructive organizational dynamic I came to understand after serving four and a half years as the executive director of the public authority responsible for the metropolitan Boston sewer system.

Since leaving that job, I have shared the Nut Island story with managers from a wide range of organizations. Quite a few of them – hospital administrators, research librarians, senior corporate officers – react with a shock of recognition. They, too, have seen the Nut Island effect in action where they work.

Comparing notes with these managers, I have found that each instance of the Nut Island effect features a similar set of antagonists – a dedicated, cohesive team and distracted senior managers – whose conflict follows a predictable behavioural pattern through five stages. The Nut Island story should serve as a warning to managers who spend the bulk of their time on an organisation’s most visible and obvious shortcomings: sometimes the most debilitating problems are the ones we can’t see.

The Nut Island Story

Nut Island is actually a small peninsula in Quincy, Masachusetts. Sitting at the southern entrance to Boston Harbor, Nut Island was a favourite landmark for seventeenth-century sailors, who savoured the scent of what one early European settler called the “divers arematicall herbes, and plants” that grew there. By 1952, when the Nut Island treatment plant went into operation, the herbs were long gone. Before the plant came on line, raw sewage from much of Boston was piped straight into the harbor, fouling local beaches and fisheries and posing a serious health hazard to the surrounding community.

The Nut Island plant was billed as the solution to Quincy’s wastewater problem. Hailed in the local press for its “modern design”, it was supposed to treat all the sewage produced in the southern half of the Boston metropolitan area, then release it about a mile out into the harbour. From the first, though, the plant’s suitability for the task was questionable. The facility was designed to handle sewage in-flows of upto 285 million gallons per day, comfortably above the 112 million gallons that flowed in on an average day. But high tides and heavy trains could increase the flow to three times the daily average, straining the plant to its limits and compromising its performance.

During most of the 30 years covered in this article, the team charged with running the plant was headed by superintendent Bill Smith, operations chief Jack Madden, and laboratory head Frank Mac Kinnon. The three joined me recently for reunion at Nut Island, which has been converted to a headworks that collects sewage from the southern Boston region and delivers it north through a tunnel under Boston Harbor to the city’s vast new treatment plant on Deer Island. The men’s affection for each other is evident, as are the lingering remnants of plant hierarchy. When someone has to speak for the entire group, Mac Kinnon and Madden still defer to Smith.
The three friends don’t need much prompting to launch into reminiscences of their years at Nut Island, which they still view as the happiest time of their working lives. They laugh often as they tell stories about the old days, featuring characters with nicknamed like Sludgie and Twinkie, and they seem cheerfully oblivious to the hair-raising conditions that were part of daily life at the plant. “It was fun,” Smith says, and his two friends nod in agreement.

Throughout our talk, the men frequently refer to themselves and their co-workers as a family. But Nut Island had not always been such a harmonious place. When Smith arrived there in 1963, fresh out of the navy, he walked into a three-way cold war among operations, maintenance, and the plant’s laboratory. For the next few years, Smith did what he could to “get a little cooperation going.” By 1968, he had gained Madden and Mac Kinnon as allies. Before long, they had weeded out most of the plant’s shirkers and assembled a cohesive team.

The people they hired were much like themselves: hard working, grateful for the security of a public sector job, and happy to stay out of the spotlight. Many were veterans of World War II of the Korean War, accustomed to managing frequent crises in harsh working conditions-just what awaited them at the aging, undersized, under funded plant.

Nut Island’s hiring practices helped create a tight-knit group, bonded by a common cause and shared values, but they also eliminated any “squeaky wheels” who might have questioned the team’s standard operating procedures or alerted senior management to the plant’s deteriorating condition. That was fine with Smith and his colleagues. Assembling a like-minded group made it easier for them to break down inter-departmental animosities by cross training plant personnel. The team leaders also made job satisfaction a priority, shifting people out of the jobs they were hired to do and into work that suited them better. These moves raised morale and created a strong sense of trust and ownership among plant worker.

Just how strong the sense of ownership was can be seen in the sacrifices the team made. Few people on Nut Island made more than $20,000 a year, low wages even in the 1960s and 1970s. Yet when there was no money for spare parts, team members would pitch in to buy the needed equipment. They were equally generous with their time. A sizable cadre of plant workers regularly put in far more than the requisite eight hours daily, but they only occasionally filed for overtime pay.

From 1952 until 1985, the Nut Island plant fell under the purview of the Metropolitan District Commission (MDC). Throughout the early and mid 1900s, the MDC had been known for the quality of its engineers and the rigor of its management. It had constructed and operated water and sewer systems that were often cited as engineering marvels. By the 1960s, though, the MDC had become the plaything of the state legislature, whose members used the agency as a patronage mill. Commissioners rarely stayed more than two years, and their priorities reflected those of the legislators who controlled the MDC budget. The lawmakers understood full well that there were more votes to the gained by building skating rinks and swimming pools in their districts than by tuning up the sewer system, and they directed their funding and political pressure accordingly.

The attitude of the MDC’s leadership toward the sewer division can be gauged by a story that ended up becoming a staple of plant lore. As it was passed around, the story became a central component of the Nut Island team’s self definition. It seems that one day, James W Connell, Nut Island superintendent in the 1960s, went to Boston to ask the MDC commissioner for funds to perform long-deferred maintenance on essential equipment. The commissioner’s only response: “Get rid of the dandelions.” Startled, the superintendent asked the commissioner to repeat himself.

“You heard me. I want you guys to take some money and get the dandelions off the lawn. The place looks terrible.”

At this point, the first stage of the Nut Island effects is in place. We have a distracted management and a dedicated team that toils, by choice, in obscurity. Team members, who share a similar background, value system, and outlook, and place enormous trust in each other and very little in outsiders, especially management. Now, an egregious display of indifference from management is all it takes to set the downward spiral in motion.

On Nut Island, this display came in January 1976, when the plant’s four gigantic diesel engines shut down. Since the early 1970s, the workers at Nut Island had been warning the top brass in Boston that the engines, which pumped wastewater into the plant and then through a series of aeration and treatment tanks, desperately needed maintenance. The MDC, though, had refused to release any funds to maintain them. Make do with what you have, plant operators were told. When something stops working, we’ll find you the money to fix it. In essence, the MDC’s management refused to act until a crisis forced their hand. That arrived when the engines gave out entirely. The team at the plant worked frantically to get the engines running, but for four days, untreated sewage flowed into the harbor.

The incident propelled the conflict between the Nut Island team and senior management from the second stage to the third-from passive resentment to active avoidance. The plant workers viewed the breakdown as a mortifying failure that they could have averted if MDC headquarters had listened to them. In ordinary circumstances, management indifferences might have killed off the team’s morale and motivation. It had the opposite effect on the Nut Islander’s. They united around a common adversary. Nut Island was their plant, and its continued operations was solely the result of their own heroic efforts.

It became a priority among the Nut Islanders to avoid contact with upper management whenever possible. When the plant ran short of ferrous chloride, a chemical used for odour control, no one from Nut Island asked headquarters for funds to buy a new supply. Instead, they would contact a local community activist and ask her to complain to her state representative about the odours emanating from the plant.

The rep would then contact MDC headquarters, and Nut Island would receive a fresh supply of ferrous chloride. Another way Nut Islanders stayed off the management’s radar screen was to keep their machinery running long past the time it should have been overhauled or junked. Among the plant’s most troublesome equipment were the pumps that drew sludge into the digester tanks. Years of deferred maintenance had degraded the pumps, but instead of asking Boston for funds, the Nut Islanders lubricated the machinery with lavish amounts of oil. Much of this oil found its way into the digested tanks themselves. From there, it was released into the harbor.

Rules of Thumb

A team can easily lose sight of the big picture when it is narrowly focused on demanding
task. The task itself becomes the big picture, crowding other considerations out of the frame. To counteract this tendency, smart managers supply reality checks by exposing their people to the perspectives and practices of other organizations. A team in the fourth stage of the Nut Island effect, however, is denied this exposure. Isolated in its lonely outpost, the team begins to make up its own rules. These rules are terribly insidious because they foster in the team and its management the mistaken belief that its operations are running smoothly.

On Nut Island one such rule governed the amount of grit-the sand, dirt, and assorted particulate crud that inevitably finds its way into wastewater-that the plant workers considered acceptable.
Because of a flaw in the plant’s design, its aeration tanks would become choked with grit if the inflow sewage exceeded a certain volume. The operators dealt with this problem by limiting sewage inflows to what they considered a manageable level, diverting the excess into the harbor. Reflecting the distorted perspective typical of teams in the Nut Island effect, these diversions were not even recorded as overflows from the plant because the excess wastewater did not, strictly speaking, enter the facility.

Another rule of thumb governed the use of chlorine at Nut Island. When inflows were particularly heavy the plant’s operators would add massive amounts of chlorine to some of the wastewater and pipe it out to sea. The chlorine eliminated some pathogens in the wastewater, but its other effects were less benign. Classified by the Environmental Protection Agency as an environmental contaminant, chlorine kills marine life, depletes marine oxygen supplies, and harms fragile shore ecosystems. To the team on Nut Island, though, chlorine was better than nothing. By their reckoning, they were giving the wastewater at least minimal treatment – thus their indignant denials when Quincy residents complained of raw sewage in the water and on their beaches.

In its fifth stage, the Nut Island effect generates its own reality-distortion field. This process is fairly straightforward in management’s case. Disinclined in the first place to look too closely at the team’s operations, management is easily misled by the team’s skillful disguising of its flaws and deficiencies. In fact, it wants to be misled – it has enough problems on its plate. One reason MDC management left Nut Island alone is that even as it was falling apart, the plant looked clean.

The manner in which team members delude themselves is somewhat more complicated. Part of their self-deception involves wishful thinking – the common human tendency to reject information that clashes with the reality one wishes to see. Consider, for instance, the laboratory tests performed at the plant. These tests were required by EPA. A former scientist with the Massachusetts Water Resources Authority tells me the staff in the Nut Island lab would simply ignore unfavorable test results. Their intent was not to deceive the EPA, the scientist hastens to add. “It was more like they looked at the numbers and said: “This can’t be right. Let’s test it again.” A long as Nut Island’s numbers appeared to fall with EPA limits; MDC management in Boston saw no reason to question the plant’s testing regimen.

Maintaining the alternate reality that prevailed on Nut Island required more than wishful thinking, however. It also involved strenuous denials when outsiders pointed out inconvenient facts. Consider what I learned from David Standley, who for several years was an environmental consultant to the city of Quincy. “I remember taking one look at the tanks’ operating parameters and saying, “this is going to die soon”,”Standley says. Predictably enough, these misgivings found an unfriendly reception on Nut Island. “Their initial reaction,” Standley says, “was hostility – they didn’t like me sticking my nose into their business.” Besides, they insisted, there was nothing seriously wrong with the digesters.

If external events had not intervened, conditions on Nut Island would probably have continued to deteriorate until the digesters failed or some other crisis erupted. The plant’s shutdown in 1997, forestalled that possibility. As part of a large-scale plan to overhaul Greater Boston’s sewer system and clean up the harbor, all sewage treatment was shifted to a new, state-of-the-art facility on Deer Island. The Nut Island team was disbanded, after 30 years of effort that left the harbor no cleaner than it was in the late 1960s when the core team first came together.

The field of organizational studies is a well-established discipline with extensive literature. Yet, the syndrome that I call the Nut Island effects has, until now, gone unnamed – though not unrecognized as I learned when I described it to other managers. Perhaps the lack of a name indicates just what a subtle and insidious thing it is; the Nut Island effect itself has flown under the radar of managers and academics just as the actions or team members go unnoticed by management.

Five Steps to Failure

The Nut Island effect is a destructive organizational dynamic that pits a homogenous, deeply committed team against its disengaged senior managers. Their conflict can be mapped as a negative feedback spiral that passes through five predictable stages.

1. Management, its attention riveted on high-visibility problems, assigns a vital, behind-the-scenes task to a team and gives that team a great deal of autonomy. Team members self-select for a strong work ethic and an aversion to the spotlight. They become adept at organizing and managing themselves, and the unit develops a proud and distinct identity.

2. Senior management takes the team’s self-sufficiency for granted and ignores team members when they ask for help or try to warn of impending trouble. When trouble strikes, the team feels betrayed by management and reacts with resentment.

3. An us-against-the-world mentality takes hold in the team, as isolation heightens its sense of itself as a band of heroic outcasts. Driven by the desire to stay off management’s radar screen, the team grows skillful at disguising its problems. Team members never acknowledge problems to outsiders or ask them for help. Management is all too willing to take the team’s silence as a sign that all is well.

4. Management fails in its responsibility to expose the team to external perspectives and practices. As a result, the team begins to make up its own rules. The team tells itself that the rules enable it to fulfill its mission. In fact, these rules mask grave deficiencies in the team’s performance.
5. Both management and the team form distorted pictures of reality that are very difficult to correct. Team members refuse to listen when well-meaning outsiders offer help or attempt to point out problems and deficiencies. Management, for its part, tells itself that no news is good news and continues to ignore team members and their task. Management and the team continue to shun each other until some external event breaks the stalemate

How to Stop the Nut Island Effect Before It Starts

What forms of preventive medicine can we prescribe to help organisations avoid the Nut Island effect? Managers need to walk a fine line. The humane values and sense of commitment that distinguished the Nut Island team are precisely the virtues we want to encourage. The trick is to de-couple them from the isolation and lack of external focus that breeds self-delusion, counterproductive practices, and, ultimately, failure.

On Nut Island, the worker’s focus paralleled their reward system. That system evolved by default as a result of MDC headquarters’ lack of interest and by explicit action from dedicated local managers. It rewarded task-driven results – avoid grit in the sedimentation tanks, keep the sludge pumps from seizing up, keep the digesters alive, maximize flows to the treated through the plant, produce fertilizer-quality sludge. The Nut Island crew were heroes, but unfortunately they were fighting the wrong war. As in combat, the generals were to blame, not the enlisted personnel.

The striking persistence of the syndrome – which lingered on Nut Island until the plant was shut down in 1997, despite a decade of structural and management changes that afforded the team greater financial resources, new career options, top management support, and other opportunities – should send a strong message to corporate managers. While there are probably ways to counteract the Nut Island effect in your company, you for better off to avoid it in the first place.

1. The first step is to install performance measures and reward structures tied to both internal operations and company-wide goals. The internal links are necessary to help build the team’s sense of local responsibility and camaraderie; the link to external goals ensures the proper calibration of internal operations to the corporate mission.

2. Second, senior management must establish a hands-on presence by visiting the team, holding recognition ceremonies, and leading tours of customers or employees from other parts of the organizations through the site. These occasions give senior management a chance to detect early warnings of problems and they give the local team a sense that they matter and are listened to.

3. Third, team personnel must be integrated with people from other parts of the organization. This exposes the local team member to ideas and practices being used by colleagues elsewhere in the company or in other organizations. This encourages them to think in terms of the big picture.

4. Finally, outside people-managers and line workers alike-need to be rotated into the team environment. This should occur every two to three years-not so often as to be disruptive but often enough to discourage the institutionalization of bad habits. So as not to appear punitive, this rotation must be a regular feature of corporate life, not a tactic aimed at a particular group.

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