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Where Is Marketing In All of This?:
I agree. The company needs to be viewed as one interdependent system not independent departments. The system needs to be optimized as a whole. And that means optimizing the overall system not optimizing the individual departments independently.
World class management understands this concept. But so many of our current management practices undermine attempts to optimize the overall system: rating and ranking people, accounting systems, performance goals, focus on quarterly profits, etc. Some have difficulty understanding that optimizing individual components of a system is not the best strategy to optimize the overall system but that is the truth.
Book, online articles and web links on systems thinking
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October 24th, 2005 at 12:02 am
This sounds good, and certainly I am hapy to agree that optimizing at the system level is optimal. But without a blueprint for action in a given company, this is about as effective as saying “what we need to do is do more better stuff”. Until transforming a company from local optima to global optima is a well-established series of steps, making noises about systems thinking is just preaching to the choir.
October 25th, 2005 at 12:27 am
Thanks for your comments. I think there are a vast majority of people making decisions in organizations today that don’t understand that you sub-optimize the whole by attempting to optimize the pieces (I don’t think they are thinking yes I will sacrifice the overall results for the local results - some do, but a minority I believe).
So I think it does help to get people to understand that concept.
Then I think there are specific examples of things that we have in our systems now that encourage this focus on sub-optimization: rating and ranking people, accounting systems, performance goals, focus on quarterly profits, commision pay, lack of understanding of managing with variation, etc. Again I think many do not understand that for example rating and ranking people contributes to sub-optimization. So raising those issues are important (it will likely take a long time to convince people).
Finally, I don’t think there will ever be an easy answer. I don’t think their will be a “well-established series of steps.” I think managers and leaders must educate themselves and then use their knowledge and experience to make decisions that do not have answers that can be stated in some “well-established series of steps.”
I realize it might be seen as a weakness, or failure, but I believe there is no quick fix management solution (or prescriptive one for that matter).
There probalby are many methods that will work fairly well to take bad management to medicore management, but I don’t find much interest in thinking about the types of systems that could prescriptively get improved, though medicore, results.
There are steps that can be taken such as focusing on reducing variation. Creating and publicizing an aim and align the organization around that aim (now most efforts to do this are a huge waste of time with no value so how you caputre that you do it right and not poorly I am not really sure). Focus on long term not just the short term. Eliminate performance appraisal. Value your workforce.
But the system of the organization is interdependant and therefore it can be that bad management practices must be employeed to conteract other weaknesses in the system until management can improve the organizaiton so that it can function properly.
I might need a cast if my leg was recently broken, but if I have a cast on my leg 4 years later that is not good. It might even be that I have become so dependant on that cast that taking it away might cause more problems. But it should be the goal to move away from bad management practices (just as it would be to remove the cast). But how that move is managed seems to me to be best managed by an educated experienced manager not a “well-established series of steps.”
I would rather focus on what I think is the correct method even if it isn’t something that is very easy to sell. I would be perfectly happy if someone does figure out a series of steps that work, I just can’t concieve of that being possible. It seems to me every year many people offer their new cookbook for management success and they don’t work. I happen to believe that is because they try to provide simplier answers than are possible. Creating a management system that runs as well as Toyota takes decades, and they still have much to improve - as they will say themselves.
April 9th, 2008 at 8:49 am
The packaging doesn’t actually change the taste, but really it is not the taste that is likely a concern but rather the perception of taste. To me this is very similar to the studies on people preferring wine they are told costs more…