Response to: Sales Compensation Plan Changes

I believe the best way to communicate such changes are to explain how they tie into the long term vision of the organization. This requires that such a vision actually exists (which is often not the case). Then all strategies are communicated based on how they support and integrate with that vision. In addition that communication strategy incorporates an understanding about what weaknesses with past practices are addressed by this new strategy. And how this strategy is based upon what we have learned in strategies we have attempted recently.

That is the communication plan shows how using the PDSA improvement cycle has driven the new strategy. This has at least 2 benefits. First it forces management (well ok not quite, it forces them to frame the decision with PDSA but it encourages them to) actually use the PDSA cycle to make decisions which will result in better decisions. Which will also mean, when possible they will have piloted the change on a small scale prior to adopting it widely (avoiding major mistakes and allowing for more rapid experimentation). And secondly it reinforces that everyone should be using PDSA for those changes they are responsible for.

Most often there is no continuity or rigorous examination of past attempts in communicating change. In such situations I see no reason to be surprised that most people just see random changes by whoever is in charge that just must be survived until the next random change.

Free, Perfect and Now is a great book by a CEO at Marshall Industries that eliminated sales commissions as an integrated strategy to improve the performance of the entire organization. I think it is a great book on this topic.

Maybe I should also say that this isn’t a particularly easy way to communicate change (having to actually examine evidence prior to making decisions, then explain how new strategies support…). But I am not looking for the easiest way to communicate change but the most effective way to continually improve. Communication change is important as a supporting process within the systemic goal of continuous improvement. The easiest communication strategy is not important. The most effective methods for the entire system are. That is sub optimize the ease of communication for the benefit of the whole. If you want an easy communication strategy just send an email that says this is how we will do things from now on.

Related: Making Changes and Taking Risks in the Sales Force - Corporate Communication Through Blogging - Improving Communication - Stop Demotivating Me!

Carnival of Human Resources #23 by Ann Bares:

Related: posts on performance appraisal - The Joy of Work - Hiring the Right Workers - Stop Demotivating Employees

This is a pretty counter-intuitive statement, I believe:

But some simple math shows it is true. If you drive 10,000 miles you would use: 667 gallons, 556 gallons, 200 gallons and 100 gallons. Amazing. I must admit, when I first read the quote I thought that it must be an wrong. But there is the math. You save 111 gallons improving from 15 mpg to 18 mpg and just 100 improving from 50 to 100 mpg. Other than those of you who automatically guess that whatever seems wrong must be the answer when you see a title like this I can’t believe anyone thinks 15 to 18 mpg is the change that has the bigger impact. It is great how a little understanding of math can help you see the errors in your initial beliefs. Via: 18 Is Enough.

It also illustrates that the way the data is presented makes a difference. You can also view 100 mpg as 1/100 gallon per mile, 2/100 gallons per mile, 5.6/100 gpm and 6.7 gpm. That way most everyone sees that the 6.7 to 5.6 gpm saves more fuel than 2 to 1 gpm does. Mathematics and scientific thinking are great - if you are willing to think you can learn to better understand the world we live in every day.

Related: Statistics Don’t Lie, But People Can be Fooled - Understanding Data - Seeing Patterns Where None Exists - Optical Illusions and Other Illusions - 1=2: A Proof

Please submit your favorite management posts to the carnival. Read the previous management carnivals.

• Some theoretical thinking by John Dowd - “Deming was fond of saying, ‘management is prediction‘ and, in this, I think he was exactly right. Management never takes action or makes decision to affect what happened yesterday, but rather to bring about what is hoped to be a desirable outcome tomorrow.”
• TPM Excellence: Visual Equipment Management by Mike Gardner - Visual aids must be clear to be useful, but they do not have to be fancy. You can see this gauge was effectively marked with a red marker–effective and cheap.
• A3–Its about the Thinking by Lee Fried - “the A3 is a tool and without the process and thinking behind it nothing really changes.”
• Lean Enterprise Rules of Three by Jon Miller “Like any good system of continuous improvement, Lean should be used to nurture people, profit and the planet (let’s expand our thinking off-planet after we confirm that our impact beyond it is significant). This is sometimes called the ‘triple bottom line.’”
• Why Sham Employee Participation Is Worse Than No Participation at All by Bob Sutton - “Hire the least expensive and least disruptive consultant you can find; if you aren’t going to listen to them anyway, you might as well waste as little money and time as possible.”
• Meeting Rules by David Maister - “1) Do not call meetings when some other form of information sharing is possible. 2) Since most people can read ten times faster than a presenter can speak, send material ahead. 3) Meetings need to have concrete goals” (previous curiouscat post: Most Meetings are Muda)
• Poppendieck: Should Lean be top-down or bottom-up? by Peter Abilla - “At its heart, Lean is a management philosophy based on deep respect for people and relentless elimination of waste from the delivery of value to customers to return sustainable prosperity for the organization.”
• No Standards No Kaizen by Ron Pereira - “Once you have the steps documented ask someone who does the same or similar job to review the steps to see if they agree with them. If they don’t, and many times they won’t, discuss it with them and see if you can mutually agree on the best way to do this task.”

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I get asked for examples of Deming managed companies fairly often. And recently I have had a number of such requests. So I figured I would provide an answer as a blog post. First, Dr. Deming would respond to such questions by referring to the theory of knowledge and the fallacy of trying to learn via examples. So remember to read up on why learning from examples is dangerous before taking to much from this.

I see Toyota as the best example of a Deming company. Dr. Deming did not propose a cookbook to follow. Instead he proposed a theory that requires learning and application within the specific institution. Toyota has created a management system that is based on Dr. Deming’s ideas and then they have evolved that over 60 years into something that is consistent with Deming’s management philosophy and has new ideas Deming did not mention. As odd as it may sound that very act of developing new concepts that were not mentioned by Dr. Deming is exactly what makes them the company that most exemplifies Deming’s management system.

Other companies that have also done a great job applying his ideas. Peaker Services has done great things. Ian Bradbury is the President and a friend. He spoke at a seminar I co-presented and I included links to a couple documents of his in a blog post. He worked at GM Power System when Dr. Deming was working with GM. Richard R. Steele founder and also serves on the Deming Institute board of trustees.

Hillerich & Bradsby Company has been following Dr. Deming’s ideas since 1984. John A. Hillerich is President and Chairman of the Board of Hillerich & Bradsby Company and serves on the Deming Institute board of trustees. The companies brands include: Louisville Slugger and Powerbuilt.

A couple of good books explore companies adopting Dr. Deming’s ideas: Free, Perfect and Now by Robert Rodin (a great book by the CEO of Marshall Industries), highly recommended). Unfortunately the company was bought by a larger company and I do not believe the Deming philosophy is alive and well (but I could be wrong). Always Think Big by Jim McIngvale is by the CEO. Mattress Mack: One man, one store, one of a kind.

Omnilingua has had amazing success applying Dr. Deming’s idea and I am proud to call Eric Christiansen their president a friend. Lean Blog Podcast with Eric Christiansen “A Deming Company”. In a previous post I recapped another example: Dr. Deming’s Ideas at Markey’s Audio Visual.

Companies awarded the Deming prize can also provide good examples. Four subsidiaries of the Rane Group in India has received awards in the last few years. Numerous people have done great things within companies - creating pockets of Deming practice. Some great examples include Steven Prevette - see some of his articles on Deming. David Anderson has incorporated Deming ideas within Microsoft and then Corbis - see his Agile Management Blog. William Bellows has a long term effort at Boeing’s Rocketdyne Propulsion & Power business unit. They offer conference call study sessions on Deming’s ideas for those within Boeing and also allow outside participation. He is also a member of the Deming Institute board of trustees.

This is just off the top of my head so I am sure I have left off many good examples. Also, for me the company needs to have an understanding what they are doing evolved from Dr. Deming’s ideas to list them (many companies have practices which are Deming based but they do not have an appreciation for Deming’s system of management - I think that appreciation is needed to be a “Deming company”). Many companies that truly and deeply practice lean manufacturing are applying many of Deming’s ideas. However to me if they do not understand the roots of the ideas from Dr. Deming I don’t consider that a “Deming company.” But that label is not all that meaningful anyway - so this just explains my thinking.

Feel free to add your suggestions in the comments.

Related: The Purpose of an Organization - Deming management blog posts

This does a great job of explaining what you need to know clearly. While this presentation for Azithromycin doesn’t prevent a mistake it sure makes it much more likely that the process can be completed successfully. We need more effort in creating such clear instructions.

Visual clarity is more important than lots of words. Applying that concept is not as easy as it sounds but it is a very important idea for instructions to end use and instructions for processes in your organization. Expecting people to read much is just setting yourself up for failure when they don’t bother (you should consider psychology, and how people will actually use your instructions not how you want them to).

via: Prescription UI

Related: Using Design to Reduce Medical Errors - Visual Instructions Example - Visual Work Instructions - Standardized Work Instructions - Health Care Pictographs - 5s - Edward Tufte’s: Envisioning Information

Appraisals are a waste of Time

That is just a start on the problems with annual rating of people. On page 101 of Out of the Crisis Dr. W. Edwards Deming states the following as one of the seven deadly diseases:

Related: Dr. Deming on performance appraisal - Continuous, Constructive Feedback - Performance without Appraisal - Righter Performance Appraisal - The Leader’s Handbook

The W. Edwards Deming Institute is sponsoring a 4 day seminar using videos of Dr. Deming’s seminars and facilitated by Ed Baker, Dave Nave, and Joyce Orsini: Quality, Productivity, and Competitive Position. Ed Baker was the person at Ford responsible for helping Ford apply Dr. Deming’s ideas.

Hear and watch Dr. W. Edwards Deming identify faulty management practices. He will describe how, as better practices are introduced, quality of products and services increases, costs decline, and you create a globally competitive advantage for your organization.

Built on archive videos of Dr. Deming, this seminar blends footage of Dr. Deming presenting his theories with live facilitation by Ed Baker, Dave Nave, and Joyce Orsini to create an interactive learning environment. Facilitated discussion following each film segment will provide opportunity to deepen your understanding of the concepts, and interpret what these ideas might mean for your organization.

This seminar explores simple and powerful principles for anyone who manages people, or holds an executive responsibility in an organization. For more details see: Quality, Productivity, and Competitive Position.

Related: Scoring a Whole in One by Dr. Ed Baker - Deming on Management - Curious Cat Management Calendar - Deming Institute Conference (2006) - Deming Seminar Update - Investors Business Daily on Deming - Where to Start Improvement

I have posted some photos from my walk last year on the Capital Crescent Trail in Washington DC.

The Capital Crescent Trail goes along the Potomac River in Washington DC (on the C&O towpath). I hiked first along the Arlington, Virginia side of the Potomac (starting at the north end of the Teddy Roosevelt Island Parking lot) then crossing over at Chain Bridge and heading back down the Capital Crescent trail and over the Key Bridge to and making a loop hike out of it.

More photos: Egypt Photo Essay - Boston (Museum of Fine Arts, Science Museum, Boston Commons…) - Glacier National Park - Great Falls National Park - Olympic National Park Photos

Great article on The Checklist - If something so simple can transform intensive care, what else can it do? by Atul Gawande

Related: Why Isn’t Work Standard? - Visual Work Instructions - posts on quality tools - European Blackout not Human Error-Not

Latest robot in Toyota’s line showcases violin skills

As I have mentioned before Toyota continues to invest and plan for the long term. And that future is not limited to automobile manufacture. We posted previously on Toyota’s partner robots. The Curious Cat Engineering Blog Robotics category has a great deal of posts on robots.

On the Toyota web site they list the following areas of non-automotive Toyota business (I don’t understand why robots are not included here): financial services, new business enterprises, marine and most surprisingly Biotechnology and Afforestation.

Related: Toyota as Homebuilder - Toyota Engineers a New Plant: the Living Kind - Toyota’s iUnit webcast (personal transport) - Toyota’s Early History - Interview with Toyota President - More on Non-Auto Toyota - 12 Stocks for 10 Years Update
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Please submit your favorite management posts to the carnival. Read the previous management carnivals.

• Is it Scrum or Lean? by Jeff Sutherland - “A thoughtful analysis of the relationship between complex adaptive systems and Lean will show that both Scrum and Lean are instantiations of complex adaptive systems theory.”
• Deming’s Inconvenient Truth by Shaun Sayers - “Deming actually believed that a lot of important management information is not only unknown, but also unknowable.” (See Curious Cat on: “most important figures that one needs for management are unknown or unknowable”
• Clothing manufacturer Fit Couture trip reports by Susanna Tisa - “To envision that these multiple SKU, complex products were being made on demand from website orders with a quick turnaround was mind-boggling.”
• Five Questions to Ask When You Hear “We’re too busy for Lean” by Jon Miller - “If the manager is already in a constant fire-fighting mode, asking them to take on yet another project in the promise that it will make their life easier is like asking for spiritual enlightenment by reading a book.”
• How Often Must the Same Mistake Be Repeated? by Mark Graban - “Wow, that is one hell of a systemic problem. It’s not as simple as one nurse being careless one time if the Quaid twins were overdosed TWICE and it happened with other patients.”
• The Lean Approach to Email Management: It’s Not About Technology by Dan Markovitz - “To paraphrase Kevin Meyer, it doesn’t pay to worship the false god of the technological solution. Attack the problem at the root, rather than trying to apply some sort of electronic panacea to a fundamentally broken system. That’s lean thinking. And it works.”

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Mary Poppendieck on The Role of Leadership in Software Development, very nice 90 minute webcast:

via, Leadership is not Obsolete for Self-Organizing Teams!

Once again Mary provides a great resource. This is a great overview. Lean Software Development by Mary Poppendieck and Tom Poppendieck is an excellent book on these topics.

Related: articles and webcasts by Mary Poppendieck - posts on software development - more management webcasts