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This is a nice article discussing how people are often fooled by thinking there must be special causes for patterns in random data. I still remember my father showing my classes these lessons when I was in grade school. Playing At Dice - What That “Weekend Exercise” Was All About:
When people are asked to explain random variations in data they will make up special causes (that they often even believe are special causes even when they are not) but you can improve management a great deal by just stopping the requirement to “explain” common cause variation (which in practices mean to claim a special cause for the common cause variation). Use that time instead to standardize processes. Create control charts for critical processes. Run experiments using PDSA cycle…
Related: Seeing Patterns Where None Exists - Understanding Data - Operational Definitions and Data Collection - Red Bead Experiment
From my post on the Curious Cat Investing and Economics blog: My guess is that traveling for health care is going to increase greatly in the future. Health costs in the USA are enormous. Costs in Europe are different - often in wait time (or costs to avoid waiting) but another option is available - travel. Countries would be very wise to focus on building up this industry in my opinion. The economic benefits could be huge.
The market is huge and growing. And the rich countries do not appear to be doing very well - especially the USA. The country needs to invest in a rigorous system to ensure world class medical care. It is almost certain the first attack will be attempts to frighten customers by saying your country is unsafe…
On this management improvement blog I continue to encourage the USA to improve the health care system. And some great strides are being made. But, Dr. Deming named the excessive health care costs a deadly disease decades ago and it is much worse today. So much so that the odds of avoiding a huge increase in overseas travel for health care is very unlikely in my opinion - even if we make better progress than I expect toward improving the USA health care system. It is an macro-economic problem and not one easily solved in 5 years or 10 years. The results (as long as countries step in to fill the market need - as has been happening) is people will travel to get health care.
Related: USA Paying More for Health Care - Change Health Care - Health Care Crisis
Bringing ‘Lean’ Principles to Service Industries by Julia Hanna
In their research, Staats and Upton document how the use of lean principles affected the workflow at Wipro. The concept of “kaizen,” or continuous improvement, for example, resulted in a more iterative approach to software development projects versus a sequential, “waterfall” method in which each step of the process is completed in turn by a separate worker.
By sharing mistakes across the process, the customer and project team members benefit individually and collectively from increased opportunities to learn from their errors; the project also moves along more quickly because bugs are discovered in the system earlier in the development process.
Iteration is very important. It is important in proper use of the PDSA cycle - many quick iterations are much better than one long slow one. And for software application development it is an excellent strategy.
I think iteration is even more important in software application development than most other areas (for now anyway) because many stakeholders cannot visualize what they need from software. Therefore attempts to force rigid requirements up front fail. No matter how much effort you put in the stakeholder just doesn’t know until they see it and use it - then they can tell you what they want changed. so design a system that works given this - iteration and agile development work very well.
Related: lean thinking articles - Experiment Quickly and Often - Management Consulting (what does the consultants web site show?) - Indian Firms Learning From Toyota (on Wipro posted here in 2005) - posts on improving software development - Not Lean Retailing
Operations is a competitive advantage… (Secret Sauce for Startups!)
In my experience it takes about 80 hours to bootstrap a startup. This generally means installing and configuring an automated infrastructure management system (puppet), version control system (subversion), continuous build and test (frequently cruisecontrol.rb), software deployment (capistrano), monitoring (currently evaluating Hyperic, Zenoss, and Groundwork). Once this is done the “install time” is reduced to nearly zero and requires no specialized knowledge. This is the first ingredient in “Operations Secret Sauce”.
This is a nice short article discussing startup IT operations. On that topic it is interesting. It is also a good example of how a bit of up front planning can help any organizations. Make plans on realistic options - which often means not expecting everything to be perfect. Expect to have to make do with fewer resources than you would like but are what you will likely have… At work, I use subversion, Ruby on Rails (and practice continuous build and test - I’ll take a look at cruisecontrol.rb) and we are setting up Capistrano. I’ll let our system administrator know about puppet (it looks useful) and take a look at the monitoring options (we have something in place now, I forget the name).
Related: Better and Different - The IT Iceberg Secret - Sub-Optimize - If Tech Companies Made Sudoku
Strategic Deployment: How To Think Like Toyota:
Another company using strategy deployment, HNI Corp., has used a policy deployment mechanism for more than a decade. The office furniture manufacturer, an IndustryWeek Best Manufacturing Company for five consecutive years, deploys its strategy companywide using a Plan-Do-Check-Act (PDCA) sequence that moves from a three-year corporate plan to a unit-level development process that creates one-year plans with action steps. Progress reviews and annual reviews evaluate progress and then the cycle starts again, explains Todd Murphy, vice president and general manager of The HON Co.’s Cedartown, Ga., facility, a 2005 IW Best Plants winner. HON is the largest operating company within HNI Corp.
Also central to policy deployment at HON is rapid continuous improvement, or RCI, a company culture focused on making breakthrough improvements. Further aligning policy deployment at HON is its reward system, which is linked to the achievement of policy deployment goals.
The Google Way: Give Engineers Room
Consider the collection of engineers who wanted to promote “agile programming” inside the company. Agile programming is a product development approach that incorporates feedback early and often, and was being done in a few scattered parts of the organization.
The Agile grouplet formed to try to take this idea and spread it throughout the organization. It did so by banding together and reaching out to as many groups as it could to teach the new process. It created “Agile Office Hours” when you could stop by and ask questions about the process. It handed out books and gave internal talks on the topic. It attended staff meetings and created the concept of the “Agile Safari,” in which you could volunteer to work for a time in groups that were using Agile, to see how it ticks.
Related: Google Software Engineering - Agile Software Development - Agile Management - Managing Innovation - Larry Page and Sergey Brin Webcast - Google: Ten Golden Rules
Manufacturing takes off in India by John Elliott:
This is not some futuristic vision of India. It’s the main factory of Moser Baer, a 24-year-old Indian company that was one of the first in the world to make high-definition DVDs and is now starting on flash memories and solar panels. And while not typical of most Indian factories, Moser Baer is one of a number of companies utilizing the same brainy ability that fueled the country’s IT boom to remake its manufacturing landscape.
…
The second problem is India’s infrastructure, especially power shortages and the grossly inadequate highways and ports that make it difficult to transport goods. New highways are helping, but growing urban congestion is making the problem worse, and there are seemingly endless bureaucratic and physical delays at ports.
India has a great deal of potential for manufacturing. The roadblocks are largely economic I think. Poor infrastructure is a huge problem that requires huge investments be made. China has made huge investments in infrastructure and they have paid off. Another incredible drain on India’s progress in manufacturing is the government bureaucracy.
Related: Manufacturing in Asia - Hopeful About India’s Manufacturing Sector - Top 10 Manufacturing Countries - articles on manufacturing management
How Curiosity Empowers Toyota by Keith McFarland:
For more than 70 years, Toyota’s curiosity has allowed it to build, brick by brick, a commercial fortress. It has scanned the globe for the best ideas—from styling to manufacturing to quality management—and imbued those ideas with a power that often surprises even the people who came up with them in the first place.
Curiosity seems like just what a cat (or company) needs to grow and learn and improve 
Related: Curious Cat management articles - posts on the Toyota Management System - lean manufacturing portal
T.N. Goh received ASQ Statistics Division’s 2007 William G. Hunter Award. He sent me this email:
Also, statistical design of experiments has assumed an increasingly important role in performance improvement and optimization in the face of constrained resources, again something always in the minds of engineers, managers and business leaders. From time to time there are others who package statistical tools under labels Bill might not even have seen himself, such as “Design for Six Sigma“, but the underlying idea is still the same: recognize the existence of variation, and the earlier you anticipate it and do something about it, the better off you will be in the end.
Bill’s zeal in spreading the message and sharing his knowledge and expertise with people in other parts of the world is well known; I would even say that he had recognized that “the world is flat” way before the likes of Tom Friedman discovered the reality of globalization!
So that’s to share my thoughts with you, having being honored by the Bill Hunter award. I am copying this to Stu, also to Doug who chairs the committee for this award. I reality enjoy the professional association and friendship with you all.
I had not realized Dad was helping set up the first school of engineering in Singapore. This is the kind of thing I mentioned in, The Importance of Management Improvement, where I mention people telling me the positive impact Dad had on their lives.
Related: Curious Cat Science and Engineering Blog - Statistics for Experimenters - Singapore Research Fellowship
India continues to shine with Deming Prizes (and of course there economy and stock market have been doing pretty well too). Companies based in India took home both Deming Prizes this year and the Japan Quality Medal. Countries of organizations receiving the Deming Prize since 2000 (prior to that almost all winners were from Japan):
| Country | Prizes |
| India | 14 |
| Thailand | 8 |
| Japan | 4 |
| USA | 1 |
| Singapore | 1 |
The 2007 Deming Prizes went to Asahi India Glass Limited, Auto Glass Division and Rane (Madras) Limited. Three different divisions of Rane received awards in the previous the last 4 years, making this Rane’s fourth prize in 5 years.
The 2007 Japan Quality Medal went to Mahindra & Mahindra Limited, Farm Equipment Sector.
The 2007 Deming Prize for Individuals went to Mr. Masayoshi Ushikubo, Chairman, Sanden Corporation. The Sanden International portion of Sanden was the third USA based organization to win a prize in 2006 (prior winners were: Florida Power & Light Company in 1989 and AT&T Power Systems in 1993). I mentioned India’s economy and stock market above, China’s economy and stock market are doing amazingly well also and then have yet to have a Deming Prize winner. I hope China, USA and many another countries can follow India’s current performance in this area. Deming Prizes are not awarded on a quota or forced ranking basis - any deserving applicants in any year can receive a prize.
Learn more about the Deming Prize.
Related: Deming Prize 2006 - Deming Prize 2005 - Deming Prize 2004 - Top 10 Manufacturing Countries - Toyota Chairman Comments on India and Thailand - 2006 Deming Medal presented to Peter R. Scholtes
Please submit your favorite management posts to the carnival. Read the previous management carnivals.
What can we do to enhance passion amongst employees?
Some think you need to pay people more. If tomorrow you doubled everyone’s pay they are excited for a short time a few months later everything is the same on the passion front (it would lesson turnover as people stay for the extra money compared to what they would get elsewhere).
Douglas McGregor explained, in the Human Side of Enterprise, nearly 50 years ago, the theory x and theory y styles of management.
Theory x believes you need to get people to work by tricking them, threatening them, motivating them, etc. Theory y believes they want to work and managers need to eliminate the de-motivation that is in place in many organizations. Dilbert makes fun of quite of a few of the stupid management practices that sap passion from people.
What you need to do is eliminate de-motivation, not to try to enhance passion directly.
Also, as Guy Kawasaki’s makes a good point when he says “the key to getting great people to work for you is to have a great product. That is why Google does so well. That is why Apple does so well.” This can help. Being a part of something great gives many people passion.
Related: Why Extrinsic Motivation Fails - Motivation - Don’t ask employees to be passionate about the company!
I have mentioned Kiva before: Microfinancing Entrepreneurs (on our Curious Cat Economics and Investing blog). In addition to being a good cause Kiva really shows some great management strategies. The use of Information Technology to connect people directly is a wonderful example of using IT effectively (understanding psychology).
Kiva lets you loan money directly to an entrepreneur of your choice. Kiva provides loans through partners (operating in the countries) to the entrepreneurs. Those partners do charge the entrepreneurs interest (to fund the operations of the lending partner). Kiva pays the principle back to you but does not pay interest. And if the entrepreneur defaults then you do not get your capital paid back (in other words you lose the money you loaned). I plan to just recycle repaid loans to other entrepreneurs.
I have just placed an additional $150 in loans to 6 business entrepreneurs (in Honduras, Indonesia[2 loans], Tajikistan, Uganda and Ukraine), along with a $100 donation to Kiva (adding to my previous Kiva loans of $350). Since our last post the Oprah Winfrey Show, President Clinton’s newly released book Giving and others have sung the praises of Kiva and made it a challenge to find entrepreneurs of Kiva to lend to (Kiva is working on building their capacity - to keep up with the demand. That seems to have been partially fixed (for awhile the supply of the entrepreneurs was completely exhausted) in last few weeks (though still they limit you to no more than $25 per entrepreneur - in order to allow the large numbers of people that want to lend to at least have the chance to loan something).
If you lend through Kiva, add a comment with a link to your Kiva page and I will add you to our list of Curious Cat Kivans.
Related: Kiva: Microfinance Loans - helping people succeed economically - Thinking About the Future
Guest post by Dave Nave
The question of where to start improvement is not an ‘either/or’ choice of top-down or bottom-up approach. The place to start is both. Leading an organization requires both a long-term and a short-term focus. With changing management practices being long-term and improving operational efficiency being short-term. The organization is a system. Optimization of any single component (management practices or production operations) frequently detracts from the whole.
For many years I firmly believed (actually hoped) the bottom-up approach would be the most effective. Especially since I came from the shop floor. However, after watching several large companies try the bottom-up approach, I realized that it didn’t work. You can show management success, but they will not believe it. Especially when the management practices involves the underlying beliefs that workers are untrustworthy, and must be dominated and controlled. I saw one Fortune 20 company turn around their operations using a process improvement program. When the bottom line numbers drastically improved, upper management scrambled for years trying to find out why. Five years later, I don’t believe they still understand how it happened, or why.
To help clarify the various arguments of top-down or bottom-up approach to implementing improvement in my own mind, I wrote a paper. Most arguments focus on ’success’ - however that is determined! What I though was missing, was the perspective of a leader who has a broad knowledge of business, the desire to help the long-term health of the organization, but did not the ability to hold off the financial dogs of short-term results. Once I started looking deeper, two key factors came to light, time to see results versus scope of influence throughout the organization. Bottom-up produces short-term improvement however it’s effects are limited to the local area. Top-down takes a long time to see results, but it effects the very foundation of the organization. The hybrid of a top-down support for a bottom-up improvement approach is not the answer. The Fortune 20 company mentioned above, tried a high level support approach to a bottom-up improvement methodology. Looking through the lens of speed and scope, suddenly product redesign (Value Engineering) became a viable option. Providing a balance of moderate returns with a moderate time delay.
I concluded that a three prong approach is needed. But, how do you manage that? By cooperation and collaboration between improving; management practices, product redesign, and process improvement.
If anyone is interested in reading my thought paper, you can download the paper - Improvement Triad: Processes, Products, and Management Practices. I would love to hear your feedback.
Related: Lean and Theory of Constraints - How to Improve - Curious Cat Management Improvement portal
I started looking at quality management resources online in 1995 (maybe 1994). At the time I was on the board of the Public Sector Network - what would become the American Society of Quality (ASQ) government division. When we started working with ASQ it took something like 2 months from the time I wrote an article until people received it. Now in 1995, the internet (outside of universities) was in its infancy. I was writing a column on the resources online for quality management - these consisted of bulletin boards (that you used your modem to call directly) and “gopher” and “ftp” sites and email lists a very few web sites. Ftp and gopher are internet protocols (as is the hypertext transfer protocol - http - we all use for the web now). Well things changed frequently back then and by the time my article would be published phone numbers wouldn’t work, addresses would be out of date, etc..
So I figured I should post my article online so people could just go there and see the updated phone numbers, addresses, etc.. That wasn’t so easy to do back then. But several of us at a W. Edwards Deming Institute conference decided to create a Deming Electronic Network (DEN). And one of those people was Del Kimbler who worked at Clemson and had access to a web site where he agreed to host the DEN. So I asked about posting the Online Quality Resource Guide there and he agreed.
Del is retiring from Clemson and so we are moving some of the material off Clemson to curiouscat.com. As part of that I ran across this November 1995 edition of the Online Quality Resource Guide. There really was a small number of good online resources for managers back then. We forget how lucky we are today. The first article I can find (right now anyway) is from the Spring of 1995. It listed a total of 2 web sites in addition to a BBS and several email lists. Clemson was listed as a gopher site and web site.
We have recently moved the Public Sector Continuous Improvement Site and Community Quality Electronic Network to curiouscat.com. Some history on PSCI and CQEN.
Related: John Hunter history - Using Quality to Develop an Internet Resource by John Hunter (1999) - Management Improvement History
Lets say you buy a some ice cream. You get your wonderful ice cream cone from the employee and they point you to a small metal dish to pick up the coins you should recieve as change (the currency is handed to the customer by the employee). A fair number of stores in the USA do this (the change is automatically put in the dish - essentially by the cash register).
It is a small thing but it seems to me this is pretty lame customer service. Ok, I understand you can speed things up but still it seems not the right image to present to customers that you can’t be bothered to hand them their change. Chipotle (at least at some stores) has given this practice a smart twist - I think. The change is dispensed to the employee (they don’t need to count it) but they then hand it to the customer - which seems to convey a sense of customer focus. I am sure this doesn’t matter much to many people but my guess is that the psychology of personal contact is marred by being directed to pick up your change from a dish.
Read the previous management carnivals. The Management Improvement Carnival #20 is hosted by Evolving Excellence, some of the highlights include:
Elegance Offsets at Elegant Solutions. If carbon offsets are viable, then why not lean offsets, feature creep offsets, and even PowerPoint offsets?
Pushback at DailyKaizen. “… in the Toyota Motor company, staff understand why a certain thing needs to be done a certain way because it is explained to them as part of the process of training.”
Top 10 Success Factors for 5S at Gemba Panta Rei. Most organizations on the lean journey have 5S programs. Here’s how you can help ensure success.
Deciding About Indecision at Simplicity. “Indecision means the inability to reach a conclusion when many people are counting on you to validate their trust in your leadership.”
Leading a Retrospective Before Introducing a Team to Kanban at aremsan. “The purpose of this retrospective was to look back at how user stories find their way to production, and to find ways to shorten the process and increase quality.”
Please submit your favorite management posts to the carnival by commenting on this post.
My comments on: No Problem Without a Solution
“Having no problems is the biggest problem of all.” - Taiichi Ohno
I understand that most managers feel that their employees should not bring them problems. Instead, expressed in the most positive way, employees should fix things or bring possible improvements. However, I think that is poor management.
I understand there may well be more detail than you provide that adds a more sensible (but more complex) reaction that stated in your post about your situation. However, there are many example, of bosses that expect their people not to bring them “bad news” not to bring them “problems” and that attitude is exactly wrong in my opinion.
What they are saying is: if you know of a problem but don’t know of a solution I would rather have my company continue to have that problem than admit some of my staff don’t know how to fix it (and then have to deal with it myself - maybe then having to accept responsibility for results instead of just blaming you if I am never told and there is a problem later…). I think that is setting exactly the wrong tone to set.
Employees should fix things. They should bring solutions to managers to improve things that might be out of their ability to fix. But if they know of a problem and not a solution and a manager tells the employee they don’t want to be brought problems then I don’t want that manager.
If an employee never learns how to find possible solutions themselves that is not a good sign. But it is much, much better to bring problems to managements attention than to fail to do so because they know the manager thinks that doing so is weak. It is the attitude that problems are not to be shared that is weak, in my opinion.
Related: Management Training Program - European Blackout: Human Error or System Error - How to Improve - Respect for People (Understanding Psychology) - Don’t Empower
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