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Please submit your favorite management posts to the carnival. Read the previous management carnivals.
There are those rare companies where interacting with them is not a dreaded experience: Trader Joe’s, Southwest Airlines, Ritz Carlton, Crutchfield, Cannon, Groovix. There are not many. And even just providing something that just works is seen as a treat. The all too common dis-service, combined with the internet, leads to Consumer Vigilantes:
Pretty lousy systems thinking (or really failures to think systemically). Pay executives obscenely and cut service until customers literally can’t stand you so much they don’t just want to avoid you they want you out of business.
And then instead of fixing the system, just burn the toast (follow the link for an explanation). Then wait from those that get the burnt toast to tell everyone that you sold them burnt toast. Then, after they do that, go scrape it for them. This is not what Dr. Deming meant when he encouraged companies to eliminate the need to inspect for quality. Of course you know that (you are reading this blog after all). Maybe the business schools decided to cut down Deming’s ideas to just eliminating inspection and a couple other sound bites. And then tell the MBA’s not to bother reading all the rest of that… we have to get on to the cost reduction strategies that will make sure you move into the c-level and get the real money.
But some companies just push people so far they have to let people know about how poorly they have been treated. Some past posts highlight the frustrating experiences bloggers, including me, share about how badly we have been treated: Ritz Carlton (good) and Home Depot (bad) - Incredibly Bad Customer Service from Discover Card - More Bad Customer Service Examples - Poor Service, an Industry Standard? (HP) - Comcast HD DVR Is Simply, Terribly Awful
Consumerist, is a great site, doing what it can to counter some of the horrible service.
ValuMetrix Services provides some really nice lean six sigma case studies. Simple short but still with enough detail to actually provide some sense of what is going on.
While on the topic of online case studies let me plug the Curious Cat management improvement library. I think it is one of the more valuable resources for management improvement offered on the Curious Cat sites. Library shelves: health care articles, lean manufacturing articles, six sigma articles, newly added articles…
via: Daily Kaizen
Related: Curious Cat Management Search - Management Consulting, what does the web site show? - Lean Management Case Study
Do corporations exist solely to maximize their bottom lines? We don’t think so., Forbes Magazine:
They don’t mention the importance of other stakeholder (employees, customers, suppliers - other than the Starbucks example) but still it is nice to read some support for the principles Deming supported: the corporation seeking to benefit all stakeholders.
Related: Curious Cat management search engine - Deming on Management - Focus on Customers and Employees
Jules Verne predicted cars would run on air. The Air Car is making that a reality. The car would be powered by compressed air. Certainly seem like an interesting idea. Air car ready for production:
The car is said to have a driving range of 125 miles so by my calculation it would cost about 1.6 cents per mile. A car that gets 31 mpg would use 4 gallons to go 124 miles. At $3 a gallon for gas, the cost is $12 for fuel or about 9.7 cents per mile. I didn’t notice anything about maintenance costs. I don’t see any reason why the Air Car would cost more to maintain than a normal car. Five-seat concept car runs on air
Now does that sound like the Toyota Production System to you? It should. If I were an executive at Toyota I would sure examine this to see if it really is as promising as it looks. And if it is Toyota sure has plenty of cash and the management practice to make a very compelling case for allowing Toyota to produce this globally. The engineers desires closely match what Toyota has learned. Both seek to eliminate the waste of transportation (friction).
Related: Click Fraud = Friction for Google - Manufacturing Takes off in India - Electric Automobiles
At Toyota, a Global Giant Reaches for Agility
The videos show everything from the correct way to hold a screw to the best way to hold an air gun so that a worker’s hand will not tire in a few hours. This month, workers from Toyota’s plant in Thailand took part in training required for jobs in their plant’s paint shop. Listening as an interpreter translated from Japanese into Thai, the workers were shown how to bend their knees and spray a water gun across a clear panel of Plexiglas.
Yet another article on the management of Toyota. And here is another: Toyota heir slowly following in family footsteps. And another: Toyota explores more efficient methods to build cars.
Related: 12 Stocks for 10 Years Feb 2008 Update - No Excessive Senior Executive Pay at Toyota - New Articles on Toyota Management - Toyota’s Effort to Stay Toyota - More Positive Press for Toyota Management - Toyota in the US Economy
Last week their was a recall of 143 million pounds of beef in the USA. Lets take a short systemic view at what is going on. The public has an interest in a safe food supply which is difficult to enforce through caveat emptor (buyer beware). So this is a natural situation for government regulation (to protect the public interest) - plus it relates to public health which is another natural for government regulation.
The USDA regulates the industry and puts in place rules as new threats emerge. So a few years ago they instituted rules that if an animal can’t walk after the USDA pre-death inspection they be re-inspected “largely as a precaution against bovine spongiform encephalopathy, or mad cow disease .” It seems hard to argue with that plan. If the pressures to maximize profits (assuring every cow is processed) exceed the desire to take precautions to ensure the safety of customers the risk of losing the trust of consumers is great.
There have been several instances, that have been made public, which call into question how effective the system is at preventing self interest from endangering the food supply. That then calls into question the safety of all meat that is part of that system. Many in the industry seem not to realize that they will be judged by the failures of any in the industry. And in my view, it is in their interests to have strong protections industry-wide.
The export market for meat is large. For political reasons some countries aim to protect local farmers and ranchers (the USA is a huge subsidizer of farmers and ranchers - Sugar Industry Quotas). And when the system continually shows that bad practices are allowed to continue it makes it a very easy decision to not allow the import of meat. Why would a country want to import food from a system that fails to follow food safety standards (especially if politically that is what they want to do - this provides them a pretty darn good reason to do what they want).
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Awhile back I wrote about why I didn’t think the American Customer Satisfaction Index claim that Yahoo beat Google for customer satisfaction was evidence of a broken indicator. Well here is another indicator, but this time it puts Google clearly in 1st place, while Yahoo has been improving: Search Engines: Intense Competition Drives Better User Experiences
Google still has plenty of room to improve (for one example, their blog search is still very poor). And Yahoo is better than many people realize. But I think Google is still clearly better from my experience and looking at the available data (Google keeps gaining market share for one import piece of data).
Related: Search Share Data, Checking the ACSI - Meeting Like Google - Improve Google
A fun read on What motivates programmers?
The tips in the post are worth reading. Yes, real world situation are always more complex but there is a great deal of truth in the post. Also, I will repeat my statement for all managers for all employees: your job is to eliminate de-motivation not to motivate.
If you really want to manage programmers well, read these blogs and take action to prevent yourself from becoming a pointy haired boss: Signal vs. Noise - Joel on Software - Paul Graham - Coding Horror - Scripting News - xkcd
Related: Joy in Software Development - Hiring Silicon Valley Style - Most Meetings are Muda - Metrics and Software Development - Amazon Innovation - Two Screens Are Better Than One
Yahoo’s Severance Plans a Defense Against Microsoft?
The severance packages would extend regular compensation for a period of four months to two years, depending on the employee’s job level. Employees would also receive continued health benefits, financial assistance for finding a new job (up to $15,000) and accelerated vesting of stock options. The move comes as reports are circulating that Microsoft will go hostile in its acquisition bid, waging a proxy battle to replace Yahoo’s board rather than raise its offer.
Interesting. Yahoo is does seem to be losing staff so there is a business reason (even for those that don’t think the way I do about benefiting all stakeholders). It also seems to fit with respect for people to me. I actually am leaning toward thinking this is something lean/Deming companies should adopt to show that the company does not support treating employees as costs to be reduced. I could see those that see companies more like balance sheets than system would object to implementing a new idea that makes MBA style layoffs more difficult. I am fine with that. I’m sure Yahoo! is actually driven partially by the poison pill feature of such a plan (which isn’t the greatest place to start but I can live with that). I haven’t thought this through completely but I like it now.
Related: People are Our Most Important Asset - Getting and Keeping Great Employees - Hiring: Silicon Valley Style - Tilting at Ludicrous CEO Pay - Curious Cat Management Job Board
That kids get tired of many toys long before the toys are worn out is not a recent revelation Those frustrated by this waste surely number in the millions in the last few decades alone. Some attempts to reduce the waste exist: garage sales, goodwill, saving for younger siblings… but the waste remains frustratingly high. While I am sure some override the cultural bias against (at least in the USA) gifting used, perfectly serviceable, toys, that practice doesn’t seem to be acceptable to many parents doing the giving (I doubt most kids would care - at least until they absorb the throw away culture as their own). Netflix for the Toddler Set highlights an attempt to deal with this waste aided by technology.
Good, I hope it is successful. It does remind me a bit of something I saw online recently (a joke I assume) looking for something that was like Netflix but for books. Um, libraries have existed for quite a long time.
Related: New, Different, Better - Science Toys You Can Make With Your Kids - Classic Children’s Books - Capitol Kids (in Madison)
The percent of GDP spent on health care in the USA increased again in 2006 - to 16%. Health care spending reached a total of $2.1 trillion, or $7,026 per person in 2006, up from $6,649 per person in 2005.
Related: USA Healthcare Costs Now 16% of GDP - Measuring the Health of Nations - USA Paying More for Health Care
Five American Manufacturers Doing It Right
Related: North American Manufacturing - Top 10 Manufacturing Countries 2006 - Top 10 Manufacturing Countries (2005) - Innovation Needed to Keep USA Manufacturing?
This is a good post on the systemic drivers of complex processes, take the time to read the whole post. I have a bias is against off the shelf software as it often ends up forcing the process to be designed around the software. And with the amazing power and relative ease of web based applications creating solutions that are specifically designed to the organization are often relatively easy. And yet, as indicated in this article there is often a strong bias in the other direction for buying off the shelf software because it is cheaper and/or faster.
Of course, the decision in each case must be weighed to determine the benefits and cost of the various alternatives. Just remember, if you decide you want simple and flexible, to have your decisions reflect that. I enjoy a telling quote from a software vendor on Toyota’s IT expectations: “it demands that the software or technology be flexible and adapt, often by customizing the code, to its business processes, and not the other way around.” They are right.
Related: Agile Software Development - Complicating Simplicity - Joy in Software Development
Six Principles for Making New Things by Paul Graham
Great advice. Similar to the evidence Clayton Christensen documents in the Innovators Solution on how to innovate successfully. New products and services often start out simple and limited and often are dismissed as unacceptable in various ways. But they solve a real problem and over time are improved and grow market share.
Experimenting quickly and often (iteration) is extremely important and given far to little focus. The PDSA improvement cycle provides a tool to encourage such thinking but still few organizations practice rapid iteration.
Related: Deming on Innovation - What Job Does Your Product Do? - Innovation at Google - Experiment and Learn - more posts related to Paul Graham
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Some people think business is only about making money. I agree with Dr. Deming that the purpose is much larger than that. Even if you take a view similar to mine though, it is not often companies intentionally help those that compete with them. But here is an example where Samuel Adams acts like a good neighbor:
So we looked at our own hops supplies at Boston Beer and decided we could share some of our hops with other craft brewers who are struggling to get hops this year. We’re offering 20,000 pounds at our cost to brewers who need them.
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We’re not looking to make money on this so we’re selling them at our cost of $5.72 a pound plus $.75 a pound to cover shipping and handling
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The purpose of doing this is to get some hops to the brewers who really need them. So if you don’t really need them, please don’t order them. And don’t order them just because we’re making them available at a price way below market. Order them because you need these hops to make your beer. We’re not asking questions, so let your conscience be your guide.
I can see a farmer helping out his neighbors in a similar way. But I don’t see companies acting this way often. I applaud Boston Beer’s action even as my cynical nature sees this as possibly more a marketing gimmick than just solely an effort to help. Still I applaud it. Too few organizations seem to have progressed beyond thinking that business is amoral. Actual good behavior is worthy of praise compared to what else goes on so often.
Related: Obscene CEO Pay - Open Source Management Terms - Tricking Customers With Sneaky Fees - Make the World Better - photo of Samuel Adams’ gravestone
Mark Graban is hosting Management Improvement Carnival #29 on the Lean blog, some of the highlights include:
Read the previous management carnivals.
I like to continue to push for some things that might not seem achievable to many. It is too easy to accept that things have to stay the way they are. Several of Dr. Deming’s list of Seven Deadly Management Diseases are now accepted as serious problems by most. Performance appraisal is a strange disease: most people agree performance appraisals are not effective and indeed are harmful. Yet, most still don’t think anything can be done about it. But we can, and should, take steps to improve. Just don’t do it.
Managers are from Mars, Performance Appraisals from Venus discusses Mary Poppendieck’s recent presentation - Appraisals and Compensation: The Elephant in the Room
Mary went over the false assumptions behind individual pay-for-performance (money, motivation, individual assessment), and the negative effects they have on the system.
She finished by a case study done by HP across 13 organizations over a year 4 year period where each division implemented a different type of incentive plan. The results are just mind boggling. They all failed and got canceled.
I strongly suggest chapter 9 (Performance Without Appraisal) of The Leader’s Handbook, by Peter Scholtes, for those thinking about this topic.
Related: Righter Performance Appraisal - Problems Caused by Performance Appraisal - Performance Without Appraisal - Find the Root Cause Instead of the Person to Blame
Comment on New or Different? by Matthew May:
I wrote a similar post on my blog awhile back: Better and Different:
Frankly, if you have to choose one, just being better will work most of the time. The problem is (using an example from Deming, page 9 New Economics) when, for example, carburetors are eliminated by innovation (fuel injectors) no matter how well you make them you are out of business.
I agree with Matthew May that it is often easy to see “new things”, when you look from a different perspective, as really just an enhancement of existing things or combining existing things in a somewhat novel way. Especially since so many things are packaged as amazing new breakthroughs when really they are nice enhancements.
Even management ideas are sold this way. And, for management ideas, I think they are most often actually degradations of what Deming, Ohno, Shewhart, Ishikawa, Ackoff… said - not enhancements. See: failures of management consulting advice.
Related: Process Improvement and Innovation - Toyota, Lean, Consultants… - Google Innovation - Management Improvement History - Doing the Wrong Things Righter - Six Sigma and Innovation - leading management thinkers
Recommended Reading From an Employee-Owned Company
In the 18 months since Mr. Quarrey picked up “Ideas Are Free,” he’s gotten back into business books – largely because of his enthusiastic employees. Web Industries, a Hartford, Conn., manufacturer, is a 100% employee-owned company. “It’s a very weird experience to be in your factory and have people comparing business books they’ve read,” he says.
There are excellent books available that would help you improve your organization. I have mentioned some of my favorite management books before but here some are again: The Leader’s Handbook by Peter Scholtes, Toyota Talent by Jeffrey Liker and David Meier, Six Sigma Beyond the Factory Floor by Ron Snee and Roger Hoerl, Lean Solutions by James Womack and Daniel Jones and The New Economics for Industry, Government, and Education by W. Edwards Deming.
My main suggestion is to read excellent books regardless of when they were written. The Human Side of Enterprise by Douglas McGregor, Fourth Generation Management by Brian Joiner, and many others might not be new but they offer more than almost any new books you will find. There is nothing wrong with excellent new books, just don’t think that because a book is 10 or even 30 years old your organization has already adopted most of the good ideas. In my experience, if more than 20% of the books you read for management ideas in the last few years are less than 5 years old you are making a mistake and would benefit a great deal from reading books written earlier.
Related: Curious Cat management article library - Curious Cat Management Improvement books - Workplace Management review - Ackoff’s New Book, Management f-Laws
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