Currently browsing the Innovation Category

Innovation is not a new idea (though the popular business press often seems to think it is). Deming on innovation.
Recommended posts: Better and Different - Innovation in Organizations - Managing Innovation - Reaction to Jeff Immelt - Ackoff, Idealized Design and Bell Labs - Six Keys to Disruptive Innovation
Articles by: Clayton Christensen and Gary Hamel


Pull Consulting: Immediate Management Consulting As You Need It

Posted on February 2, 2012  Comments (0)

I think the potential for consulting as you need it is great. I actually was looking into creating an application to support the ability to provide this service with someone else; but we just had too many other things going on. I have now made myself available for consulting you pull as you need it through MinuteBox. You can get consulting when you need it for as little time as you need.

So if you are trying to apply the ideas I discuss on this blog and run into issues you would like to get some help with connect with me and you can get some immediate coaching on whatever you are struggling with. I am offering a special rate of $1.99 a minute, for now. The graphic on the right of this post (any post on this blog, actually) will show if I am available right now (as does johnhunter.com). If so, you can connect and get started. If not, you can leave a message and we can arrange a time.

I am featured on MinuteBox with this cool graphic, isn’t it nice :-)

home page of MInute Box with John Hunter graphic

John Hunter feature on Minute Box homepage

One advantage of this model is that those of you following this blog have a good idea of what topics you would like to delve into more deeply with me. If you have any questions on a particular topic you would like answered today or arranging coaching on specific topics over a period of time or help planning a project or someone to bounce your ideas off give this consulting as you need it model a try.

For those of you management consultants reading this blog (I know there are many) you can create your own Minute Box account easily and provide this service also. And even if you are not a consultant if you have advice worth sharing (and I know there are many of you also) you can also set up an account.

Related: John Hunter’s professional life timeline – John Hunter online – John Hunter LinkedIn profile – Top Leadership blogs – Top Management and Leadership blogs – Top Management blog

You’ve Got to Find What You Love

Posted on October 5, 2011  Comments (2)

Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do. If you haven’t found it yet, keep looking. Don’t settle. As with all matters of the heart, you’ll know when you find it. And, like any great relationship, it just gets better and better as the years roll on. So keep looking until you find it. Don’t settle.

- Steve Jobs



Watch this great commencement speech by Steve Jobs at Stanford in 2005.

We lost a great person today, when Steve Jobs died at the age of 56. His words are just as important today: you have got to find what you love to do. Keep looking until you find it. It won’t necessarily be easy to do. But life is too short to waste merely getting by.

My father found what he loved and pursued that throughout his life. He also died young. They both died young, but they both had great lives because they took charge to make the most of their lives. By doing what they loved they made the world a better place for many others, and themselves. Take that message to heart and make your life the best it can be.

Related: Quotes from Steve Jobs – Peter Scholtes – Positivity and Joy in Work – Build an Environment Where Intrinsic Motivation Flourishes – Remembering Bill Hunter

The Need to Improve Management While Building Organizations Fit For Human Beings

Posted on September 29, 2011  Comments (2)


Gary Hamel: Reinventing the Technology of Human Accomplishment

I agree with Gary Hamel that we need to adopt new management strategies. I happen to believe most of new strategies we need to adopt have been known for decades, we just fail to implement many of them.

He argues it is hard to retain knowledge advantages (within companies). I agree. However execution advantages it seems to me are not that difficult to maintain. Few companies actually focus on the customer and continual improvement. Toyota can be incredibly open but still few others are not willing to actually put in the effort to execute fully.

The reverse accountability idea he discusses I don’t love as much as he does. I do believe it is good to value the entire workforce more and not base decisions on HiPPOs. Accountability is a loaded term, in my opinion. Even in he talk he focuses on the “fear” – if the supervisor doesn’t fix the issue to the reporters satisfaction in 24 hours it is escalated to the next level. The process could be better, without what seems like driving in fear, to me.

I agree that the best management strategy is to adopt the thinking he captures with “you cannot build a company that is fit for the future, without building one that is fit for human beings.” The part I don’t agree with is phrase he lead that quote with: “Because I think for the first time since the industrial revolution…” isn’t right. I think Dr. Deming taught that idea to Japan in the 1950′s and as we all know Toyota adopted as the core “Respect for People” principle. That concept was important in 1950. That management idea is needed. Adopting that principle would be new for many of our organizations. But it also is true that the idea has been known for decades.

I return to this theme frequently. We don’t need many new ideas. We just need to adopt the good ideas that have been proven for decades. The new ideas are mainly just a bit of flavoring to tweak the good ideas we have had available and just chosen to ignore.

Related: Respect People by Creating a Climate for Joy in Work – Management Advice Failures – Positivity and Joy in Work

Sometimes Micro-managing Works

Posted on April 27, 2011  Comments (3)

Sometimes micro-managing works. That doesn’t mean it is a good strategy to replicate. If you benchmark Apple you might decide that you should have a tyrannical obsessive involved CEO who is directly involved in every detail of products and services. After all Apple is now the second most valuable company in the world with a market capitalization of $324 billion (Exxon Mobil is the top at $433 billion) and a huge part of that is Steve Jobs.

Nice quote from How to beat Apple

Apple products & services that Apple does well are the ones that Steve Jobs uses

An interesting point, and really it doesn’t matter if it is completely true it illustrates a point that Steve Jobs is the rare leader that helps by being completely involved in nearly every detail. And at the same time he provides strategic leadership rivaled by very few others. But if you try to benchmark this (simplistically – as most benchmarking is done) you will fail. This works with Steve Jobs and maybe a handful of other people alive today. But with most leaders and organizations it would fail completely.

On another point Jason Kottke makes, I would normally suggest the opposite approach:

Openness and secrecy. Competitors should take a page from Apple’s playbook here and be open about stuff that will give you a competitive advantage and shut the hell up about everything else. Open is not always better.

I think you may well be better off doing the opposite and countering Apple’s secrecy with openness. It would depend on your organization, but, I think you might be better off trying to exploit Apple’s weakness instead of trying to do what they do well. Now things are never this simple but on a cursory level I think that is where I would look.

Google now has a market cap of $171 billion, Apple is almost double that – just 3 years ago Apple first exceeded Google’s value.

Related: Leadership is the act of making others effective in achieving an aim – The CEO is Only One Person – Jeff Bezos Spends a Week Working in Amazon’s Kentucky Distribution Center – Respect for People – Dee Hock on Hiring

Customer Focus and Internet Travel Search

Posted on March 24, 2011  Comments (1)

The internet should make finding airline flight information easy. Instead it is a huge pain. Hipmunk has taken on the challenge of doing this well, and I think they have done a great job. This video provides an excellent view of both web usability and customer focus. This is a great example of focusing on providing customer value and using technology to make things easy – which is done far to little at most companies.

Related: Innovation Example (Farecast – which seems to have been bought by Microsoft and broken) – Making Life Difficult for Customers – Confusing Customer Focus – Joel Spolsky Webcast on Creating Social Web Resources – CEO Flight Attendant

Learn by Seeking Knowledge – Not Just from Mistakes

Posted on March 7, 2011  Comments (1)

Being open to new ideas and new knowledge is what is needed to learn. Experimenting, seeking out new knowledge is even better.

You can be successful and see an even better way to do things and learn from it. This seems the best way to learn to me – not to just learn from mistakes. Of course this means your goal has to be improvement not just avoiding more mistakes than before.

Your actions are based on theories (often unconsciously): and learning involves improving those theories. Learning requires updating faulty ideas (or learning new ideas – in which case ignorance rather than a faulty theory may have lead to the mistake). Encouraging people to learn from mistakes is useful when it is about freeing them to make errors and learn from them. But you should be learning all the time – not just when you make mistakes.

You can be also be wrong and not learn (lots of people seem to do this). This is by far the biggest state I see. It isn’t an absence of people making mistakes (including carrying out processes based on faulty theories) that is slowing learning. People are very reluctant to make errors of commission (and errors of commission due to a change is avoided even more). This reluctance obviously makes learning (and improvement) more difficult. And the reluctance is often enhanced by fear created by the management system.

It is best to be open and seek out new knowledge and learn that way as much as possible. Now, you should also not be scared to be wrong. Taking the right risks is important to improving – encouraging creativity and innovation and risk taking is wise.

Experiment and be open to learn from what could be better and improve (PDSA is a great way to try things and evaluate how they work). And the idea is not to be so conservative that every turn of the PDSA cycle has no failures. In order to get significant successes it is likely you will try things that don’t always work.

The desire to improve understanding (and the desire to improve results provides focus to the learning) is what is valuable in learning – not being wrong. Creating a culture where being wrong needs to be avoided harms learning because people avoid risk and seek to distance themselves from failure instead of experimenting and digging into the details when something goes wrong. Instead of learning from mistakes people try to stay as far away from them and hide them from others. That is not helpful. But what is needed is more desire to continually learn – learning from mistakes is wise but hardly the only way to learn.

Related: The Illusion of Knowledge – confirmation bias – Management is Prediction

How to Get a New Management Strategy, Tool or Concept Adopted

Posted on December 6, 2010  Comments (6)

Often when learning about Deming’s ideas on management, lean manufacturing, design of experiments, PDSA… people become excited. They discover new ideas that show great promise to alleviate the troubles they have in their workplace and lead them to better results. But how to actually get their organization to adopt the ideas often confounds them. In fact, I believe most potential improvements efforts may well fail even before they start because people can’t get past this problem.

I believe the way to encourage adoption of management improvement tools, methods and ideas is to solve people’s problems (or give them new opportunities). Instead of trying to convince people by talking about why they need to adopt some new ideas, I think it is much better to show them. To encourage the adoption of whatever it is (a philosophy like Deming or a new tool) try to find projects that would be good candidates for visible success. And then build on those successes.

For adopting whole new ways of working (like lean thinking) you go through this process many times, adding more and more new ideas to the accepted way of doing things. It is a bit easier if you are the CEO, but I think the strategy is very similar whoever you are. For smaller efforts a boss can often just mandate it. But for something like a large improvement in the way work is done (adopting a lean management system, for example), the challenge is the same. You have to convince people that the new methods and ideas are valuable and that they can use the ideas to help improve results.

Start small, it is very helpful if initial efforts are fairly small and straight forward. You often will have limited resources (and limited time people are willing to invest) at first. so start by picking projects that can be accomplished easily and once people have seen success more resources (including what is normally the most important one – people’s time) should be available. Though, honestly getting people to commit will likely be a challenge for a long time.

It is a rare organization that adopts a continual improvement, long term focus, system thinking mindset initially. The tendency is often strong to focus on fire fighting, fear (am I taking a risk by doing x, if I spend time improving y – what about the monthly target my boss is measuring me on…) and maintaining the status quo. It is baffling to many hoping for improvement, when you have huge successes, and yet the old way of doing things retains a great hold. The inertia of organizations is huge.
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Annual Performance Reviews Are Obsolete

Posted on November 15, 2010  Comments (0)

Sam Goodner, the CEO of Catapult Systems, wrote about his decision to eliminate the annual performance appraisal.

the most critical flaw of our old process was that the feedback itself was too infrequent and too far removed from the actual behavior to have any measurable impact on employee performance.
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I decided to completely eliminate of our annual performance review process and replace it with a real-time performance feedback dashboard.”

I think this is a good move in the right direction. I personally think it is a mistake to make the measures focused on the person. There should be performance dashboards (with in-process and outcome measures) that provide insight into the state of the processes in the company. Let those working in those processes see, in real time, the situation, weaknesses, strengths… and take action as appropriate (short term quick fixes, longer term focus on areas for significant improvement…). It could be the company is doing this, the quick blog post is hardly a comprehensive look at their strategies. It does provide some interesting ideas.

I also worry about making too much of the feedback without an understanding of variation (and the “performance” results attributed to people due merely to variation) and systems thinking. I applaud the leadership to make a change and the creative attempt, I just also worry a bit about how this would work in many organizations. But that is not really what matters. What matters is how it works for their organization, and I certainly believe this could work well in the right organization.

Related: Righter Performance Appraisal – When Performance-related Pay Backfires – The Defect Black Market – articles, books, posts on performance appraisal

Why Don’t Football Players Just Thrown the Ball Out of Bounds to Stop the Clock

Posted on October 24, 2010  Comments (0)

I have never understood why players don’t lateral the ball out of bounds to stop the clock in pro or college football in the USA. If time is running out and the player is tackled in bounds the clock keeps running and time can expire. You can stop the clock by running out of bounds. Also if the ball goes out of bounds the clock is stopped. I figured maybe there was some rule against just throwing the ball out of bounds to stop the clock. I never hear announcers explain that they can’t just throw the ball out of bounds due to a rule, though.

John Clay, Wisconsin Badgers

I decided to go the the source, on page 73 of the official NCAA football rules it says the clock stops: “With fewer than two minutes remaining in a half a Team A ball carrier, fumble or backward pass is ruled out of bounds.”

However, on page 103 (of 272) it states: “A ball carrier may hand or pass the ball backward at any time, except to throw the ball intentionally out of bounds to conserve time. [The penalty for breaking the rule is] five yards from the spot of the foul; also loss of down.” The clock is started when the ball is ready for play (rule 3-4-3 says the clock restarts on the ready to play signal for “unfair clock tactics” penalties).

From the rule book appendix: “A ball carrier, late in the second period, throws a backward pass out of bounds from behind or beyond the neutral zone to conserve time. RULING: Penalty – Five yards from the spot of the foul and loss of down. The clock starts on the ready-for-play signal.” By the way an illegal forward pass has the same penalty.

Still to me this leaves a very good reason to lateral the ball out of bounds. It should certainly take less time to line up and ground the ball after the ball is marked ready for play than it would if the clock is never stopped. Often you could still have time to run a play or just ground the ball and stop the clock.

The NFL does use a 10-second runoff rule, and with the referee winding the clock on the ready for play, which would likely make an deliberate attempt a bad idea. But as far as I can tell college rules don’t have that time penalty. It seems to me, if you want to have a rule against stopping the clock that way, it probably is wise to have the 10 second penalty.

Even if for some reason taking that penalty doesn’t work if you are in the middle of the filed you could thrown it to someone near the sidelines to let them get out of bounds. Also if you at least make that attempt and then the ball goes out of bounds (just form your lateral) it seems to me you at least have the hope the referees won’t call the penalty that requires your intent to thrown it out of bounds to stop the clock, in order for it to be a penalty.

Related: Randomization in Sports – NHL Experiments with the Rules of Hockey – Physicist Swimming Revolution
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Change How Your Business Changes

Posted on September 13, 2010  Comments (0)

John Kotter believes technology and globalization are requiring us to change more rapidly. “It is very difficult to innovate without requiring people to do something different.” If an organization culture is mainly avoiding making anyone uncomfortable, innovation and improvement are quite difficult.

Improvement is required to stay in business today. The key to good management systems is how rapidly improvement is achieved, not that improvement is being made.

Related: Communicating Change – Process Improvement and Innovation – Building on Successful Improvement – How to Improve

Frugal Innovation

Posted on June 9, 2010  Comments (1)

First break all the rules

The device is a masterpiece of simplification. The multiple buttons on conventional ECGs have been reduced to just four. The bulky printer has been replaced by one of those tiny gadgets used in portable ticket machines. The whole thing is small enough to fit into a small backpack and can run on batteries as well as on the mains. This miracle of compression sells for $800, instead of $2,000 for a conventional ECG
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Frugal products need to be tough and easy to use. Nokia’s cheapest mobile handsets come equipped with flashlights (because of frequent power cuts), multiple phone books (because they often have several different users), rubberised key pads and menus in several different languages. Frugal does not mean second-rate.

The article goes on to talk about several methods for how to profit from reducing costs which seem misguided. Frugal innovation is about thinking about meeting the needs of huge numbers of customers that can’t afford conventional solutions. By talking a new look at the situation and attempting to find solutions with significant price constraints new markets can be opened. Often this requires thinking similar to disruptive innovation (products that serve a similar need but less completely than current options).

It also requires the engineering principles of appropriate technology. I highlight this thinking in my Curious Cat Engineering blog and find it very worthwhile. For organizations that have a true mission to serve some purpose using such thinking allows a greatly expanded potential market in which to make a difference in the world.

There is a great quote from Jeff Bezos that captures one reason why organizations so often fail to address frugal innovation: “There are two kinds of companies, those that work to try to charge more and those that work to charge less.” Many organizations are focused on trying to charge more, not less. Another problem is that decision makers often have no life experience with cheap solutions – this doesn’t prevent frugal innovation but it does make them less likely to see the need and to decide to solve those customer needs.

Related: Appropriate Management – Managing Innovation – Process Improvement and Innovation

Net Neutrality, Policy, Economics and Intelligent Engineering

Posted on April 13, 2010  Comments (3)

I believe net neutrality should be championed to prevent decay of the usability of the internet. It seems to me internet connectivity is a natural monopoly that economic theory says should be a regulated monopoly. Smart countries have invested in providing much better internet connectivity that the USA has at much lower prices. Now in the USA we have companies that seek to control internet connectivity and then use that monopolistic control to favor higher margin efforts. So force those that have resources available on the internet to pay or the ISP threatens to degrade the connectivity to their resources.

chart showing internet connectivity speed (USA 18th)

The investment in equipment and fiber that allows internet connectivity has to be paid for. If those regulated ISPs wanted to set bandwidth use pricing that is fine with me. If we decided it is best to have one low price say $30 a month for access at a similar perforance of 10 other countries (Japan, Germany, South Korea, Canada, United Kingdom…) and then charge extra for individuals those that use more than some amount fine. But I think it should not be tied to whether you use service that haven’t paid the ISP money to be favored. The USA is currently 18th and slowed down, while others continue to speed up.

The 2008 ITIF Broadband Rankings show the USA in 15th place, out of 30 OECD countries, for broadband adoption, speed and price. In 2001 the USA was in 4th place.

If ISPs don’t want to be in the business they should be in – providing internet connectivity. Fine, get out of that business and go into the business they want to be in. But don’t try to take control of a natural monopoly and then use that control to extort money from those that rely on the natural monopoly.

Google accused of YouTube ‘free ride’

Some of Europe’s leading telecoms groups are squaring up for a fight with Google over what they claim is the free ride enjoyed by the technology company’s YouTube video-sharing service. Telefónica, France Telecom and Deutsche Telekom all said Google should start paying them for carrying bandwidth-hungry content such as YouTube video over their networks.

I can understand why they would think that way. But isn’t it equally valid to say hey those that pay you for internet connectivity really want to use YouTube. If you need to make more investments in your infrastructure to support your customers use, then do so and raise the prices. I completely disagree with the ISP negotiating what content users can see. But if that were to happen why couldn’t Google instead of paying say, hey your customers really want YouTube – if you don’t pay us we won’t let you deliver it to your customers?

Net Neutrality: This is serious by Tim Berners-Lee

When I invented the Web, I didn’t have to ask anyone’s permission. Now, hundreds of millions of people are using it freely. I am worried that that is going end in the USA.
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Yes, regulation to keep the Internet open is regulation. And mostly, the Internet thrives on lack of regulation. But some basic values have to be preserved. For example, the market system depends on the rule that you can’t photocopy money. Democracy depends on freedom of speech. Freedom of connection, with any application, to any party, is the fundamental social basis of the Internet, and, now, the society based on it.

Let’s see whether the United States is capable as acting according to its important values, or whether it is, as so many people are saying, run by the misguided short-term interested of large corporations.

I hope that Congress can protect net neutrality, so I can continue to innovate in the internet space. I want to see the explosion of innovations happening out there on the Web, so diverse and so exciting, continue unabated.

Google’s Traffic Is Giant, Which Is Why It Should be Your ISP
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Toyota’s Journey to Lean Software Development

Posted on March 18, 2010  Comments (0)

Toyota’s journey from Waterfall to Lean software development by Henrik Kniberg

Toyota builds cars (duh). In the past that didn’t involve much software, and the little software that was needed was mostly developed by suppliers and embedded in isolated components. Toyota assembled them and didn’t much care about the software inside. But “The importance of automatic electronic control system has been increasing dramatically year by year” said Ishii-san.

A modern car is pretty much a computer on wheels! In a hybrid car about half of the development cost is software, it contains millions of lines of code as all the different subsystems have to integrate with each other. He mentioned that a Lexus contains 14 million lines of code, comparable to banking and airplane software systems. Ishi-san concluded that “Therefore Toyota needs to become an IT company”.
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Most of Toyota’s ideas about how to do Lean software development resonated well with me. My feeling was that they are on the right track.

One thing bothered me though – the extreme focus on detailed metrics. I agree with the value of visualization, standardization, and data-driven process improvement – but only if used at a high level. My feeling was that Toyota was going to far. They say engineer motivation is critical, but how motivating is it to work in an organization that plans and measures everything you do – every line of code, every hour, every defect, how many minutes it takes to do an estimate, etc?

via: Justin Hunter

Related: Toyota IT Overview – Toyota Canada CIO on Genchi Genbutsu and Kaizen – Lean Software Development – My First Trip to Japan by Peter Scholtes – Toyota IT for Kaizen

Observations of a New Googler

Posted on February 6, 2010  Comments (2)

Some interesting thoughts from a new Google engineer, Things I’ve learned at Google so far

I would describe Google’s culture as “creative chaos”. There was some confusion about where I was supposed to be when I started. This resulted in the following phone call, “Hello?”, “Hello Ben, this is Conner (that’s my new manager), where are you?” “Mountain View.” “Why are you there?” “Because this is where the recruiter said to go.” “Good answer! Nice of them to tell me. Enjoy your week!” This caused me to ask an experienced Googler, “Is it always this chaotic?” The response I got was, “Yes! Isn’t it wonderful?” That response sums up a lot about Google’s culture. If you’re unable to enjoy that kind of environment, then Google isn’t the place for you.
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Paul Buchheit was a software engineer at Google. He didn’t need permission to write something like gmail. Corporate culture says that if you need something like that, you just go ahead and do it. In fact this is enshrined as an official corporate policy – engineers get 20% of their time to do with pretty much as they please, and are judged in part on how they use that time. I found a speech claiming that over half of Google’s applications started as a 20% project. (I’m surprised that the figure is so low.) To get a sense of how much stuff people just do, visit Google Labs. No corporate decision. No central planning.
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Sick day policy. Don’t show up when you’re sick and tell people why you’re not showing up. Note what’s missing. There is no limit to how much sick time you get if you need it.

I think he overestimates the lack of central planning, still it is another interesting view of Google.

Related: Eric Schmidt on Management at Google – Google: Ten Golden Rules – The Myth of the Genius Programmer

Hospital Providing Better Health Care While Reducing Costs

Posted on January 19, 2010  Comments (0)

Business Week has a good article on the strides one hospital has been able to make at reducing costs and improving quality. Hospitals: Radical Cost Surgery

Walk into Providence Regional Medical Center, in Everett, Wash., and you will see a hospital trying something different: It brings the equipment to the patient. In 2003, Providence opened one of the few “single stay” wards in the nation. After heart surgery, cardiac patients remain in one room throughout their recovery; only the gear and staff are in motion. As the patient’s condition stabilizes, the beeping machines of intensive care are removed and physical therapy equipment is added. Testing gear is wheeled to the patient, not the other way around. Patient satisfaction with the “single stay” ward has soared, and the average length of a hospital stay has dropped by a day or more.
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High quality at a low price. Every other industry strives for that combination, but a hospital that does both is all too rare. Providence and its cost-efficient brethren demonstrate that quality care can be delivered at an affordable price, provided hospitals can be persuaded to rethink decades-old practices.

The crazy world of hospital economics does not offer a lot of incentives to change. Both Medicare and private insurers reimburse on a piecework basis – known as fee-for-service – that encourages hospitals to treat more, prescribe more, and test more.
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Providence has also published data showing that infections, lengths of stay, and surgical complications have dropped since starting its own program.

But hospitalists are still controversial in many communities, because primary care physicians are wary of giving up control of their patients, along with their share of inpatient fees. Dr. Joanne C. Roberts, one of the first hospitalists at Providence, has not seen this conflict in Everett, possibly because most of the hospitalists and primary care doctors are associates at one large medical practice, Everett Clinic. That’s not true everywhere, she says. “In another community where I worked, independent doctors were pretty hostile. Everyone was trying to grab part of the money. That just doesn’t happen here.”
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In a study of 2,531 operations at Providence, Brevig reported that the incidence of transfusions was reduced to just 18% in 2007, from 43% in 2003, while the average patient stay was reduced by half a day. The changes have saved Providence an estimated $4.5 million.

Brevig has been proselytizing for his plasma practices at medical meetings, but to little avail. Only some 200 U.S. hospitals have a blood conservation program. Since patients are billed the cost of the plasma, doctors aren’t motivated to change their habits.

There are many more great examples of positive actions being taken in health care. But all you have to do is look at the overwhelming evidence of how amazingly poorly the health care system in the United States is doing to know that it is, overall, an enormous failure. For decades the enormous cost of supporting special interest groups that benefit from the current broken system have forced the rest of society to pay for their unwillingness to improve. We can no longer afford to accept the poor performance. We need to adopt the new ideas much more quickly and eliminate the taxes on the rest of society to support those that want to take an every increasing amount from society to support their outdated, failed policies.

Related: Community Medical Care Successes – CEOs Want Health-Care Reform – USA Spends Record $2.3 trillion ($7,681 Per Person) on Health Care in 2008 – Health Care: Lessons for the USA from Switzerland

Systemic Health Care Failure: Small Business Coverage

Posted on December 27, 2009  Comments (1)

There are many significant problems with the medical care system in the USA. It makes sense that a system that costs over 50% more than other countries and has no better outcomes, from all that extra spending, suffers from many failures. Coverage for small business is one of the problems we face now – When Health Insurers Dump Small Companies:

In June testimony before the Senate Commerce Committee, Potter said insurers “dump small businesses whose employees’ medical claims exceed what insurance underwriters expected. All it takes is one illness or accident among employees at a small business to prompt an insurance company to hike the next year’s premiums so high that the employer has to cut benefits, shop for another carrier, or stop offering coverage altogether – leaving workers uninsured.”
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Joy Mosley, COO of Biotest Laboratories, a 77-person medical testing company in Minneapolis, recently got such a “requote” from her insurer, Medica, after an employee was diagnosed with pancreatic cancer. Medica covered the million-dollar treatment, but then said the large claim warranted $156,000 in additional premiums – a 72% increase.
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Not all entrepreneurs are equally vulnerable. About a dozen states prohibit insurers from basing premiums for businesses with 50 or fewer employees on workers’ health status. But in roughly three-fourths of the country, so-called ratings bands allow for considerable flexibility in pricing. In states with loose ratings bands, such as Texas and Nevada, one small company can be charged nearly 70% more than another. In Pennsylvania and Virginia, there are no ratings restrictions. No matter what state you’re in, ratings bands don’t apply to companies with more than 50 employees.

Just from an insurance perspective the companies are not providing what is needed. They are quick to say you can’t have healthy people remain uncovered and wait to buy insurance once for example, “their house is on fire” (they are sick). They are right. Well you also can’t have the insurance company cancel coverage during the fire and have a system that works.
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Russell L. Ackoff: 1919 -2009

Posted on October 31, 2009  Comments (4)

photo of Russell Lincoln Ackoff

We lost another of the absolutely best minds in management history, this week. Somehow, many managers, do not know of Russell Ackoff’s ideas. I find that amazing. Dr. Ackoff is one of two management thinkers that any manager, that is serious about improving management results in their organization, must study (the other is Dr. Deming).

The Curious Cat management library includes many articles by Russell Ackoff. Transformation and Redesign at the White House Communications Agency by March Laree Jacques is a great articles exploring adopting his ideas.

Like many management greats he had no limit to the great ideas he put forth. He believed in the value of people and the importance of social systems. He is well known his ideas on systems thinking and specifically human systems. He understood to create effective management structures the human element must be at the heart of the system. He firmly believed in respect for people and his management ideas built on providing the opportunity for people to flourish.

We lost another great management mind. But by reading Ackoff’s books and articles and learning from him we can continue the improvements he brought to management during his life. His ideas will continue to provide those that adopt them great success for a long long time. And the management community will continue to build on his work and that of others to help managers improve their organizations.

Earlier this year we lost Peter Scholtes, another management leader and friend of Russell Ackoff. Russell wrote the forward to Peter’s Leader’s Handbook.

Peter Scholtes is an education, not a guru. A guru is one who develops a doctrine and seeks disciples who accept and transmit it without modification. No deviation is acceptable…
Educators, on the other hand, encourage and even try to inspire progressive deviations from what they have said. Their objective is not to remove the need for further learning, as is the guru’s, but to initiate it

Those words also describe Russell Ackoff perfectly. He inspired those he worked with to adapt and transform his ideas as they worked to improve their organizations. Take this opportunity to learn more about his ideas, you will not be disappointed.

Related: Russell L. Ackoff, Management Consultant & Systems Thinker, 1919 -2009 – Ackoff, Idealized Design and Bell Labs – Quotes By Dr. Russell L. Ackoff – Dr. Russell Ackoff Webcast on Systems Thinking – From Mechanistic to Social Systemic Thinking – Traffic Congestion and a Non-Solution – Write it Down to Improve Learning – Designing a New Organization – Ackoff’s New Book: Management f-Laws – The Importance of Management Improvement

An Introduction to Deming’s Management Ideas by Peter Scholtes (webcast)

Posted on September 14, 2009  Comments (1)

An Introduction to Deming’s Management Teaching and Philosophy by Peter Scholtes – webcast from the Annual W. Edwards Deming Institute conference in Madison, Wisconsin, November 9th, 2008. My previous post on this speech: 6 Leadership Competencies.

Next month, the Annual Deming Institute conference will be held at Purdue on Oct 10th, 2009.

Related: Peter Scholtes’ Life – Curious Cat’s Deming on Management – The Leader’s Handbook – Performance without Appraisal

Unfortunately I cannot actually use the website to watch more than 5 minutes because the site fails to support linux operating system with their solution for longer videos. Google will only allow 10 minute videos without special permission – YouTube has not replied to my request for over 6 months. Update: Twitvid let me upload the whole video.

Zappos and Amazon Sitting in a Tree…

Posted on July 23, 2009  Comments (6)

Amazon is acquiring the unique company – Zappos: we have written about Zappos previously: Paying New Employees to Quit. Jeff Bezos uses the webcast above to talk to the employees of Zappos. Excellent job. The letter from Tony Hsieh, the Zappo’s CEO, to employees is fantastic. This is a CEO that respects employees. These are leaders I would follow and invest in (and in fact I am glad I do own Amazon stock).

First, I want to apologize for the suddenness of this announcement. As you know, one of our core values is to Build Open and Honest Relationships With Communication, and if I could have it my way, I would have shared much earlier that we were in discussions with Amazon so that all employees could be involved in the decision process that we went through along the way. Unfortunately, because Amazon is a public company, there are securities laws that prevented us from talking about this to most of our employees until today.
…
Several months ago, they reached out to us and said they wanted to join forces with us so that we could accelerate the growth of our business, our brand, and our culture. When they said they wanted us to continue to build the Zappos brand (as opposed to folding us into Amazon), we decided it was worth exploring what a partnership would look like.

We learned that they truly wanted us to continue to build the Zappos brand and continue to build the Zappos culture in our own unique way. I think “unique” was their way of saying “fun and a little weird.” :)

Over the past several months, as we got to know each other better, both sides became more and more excited about the possibilities for leveraging each other’s strengths. We realized that we are both very customer-focused companies — we just focus on different ways of making our customers happy.

Amazon focuses on low prices, vast selection and convenience to make their customers happy, while Zappos does it through developing relationships, creating personal emotional connections, and delivering high touch (“WOW”) customer service.

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Toyota Develops Thought-controlled Wheelchair

Posted on June 30, 2009  Comments (2)

Toyota has developed a thought-controlled wheelchair (along with Japanese government research institute, RIKEN, and Genesis Research Institute). Honda has also developed a system that allows a person to control a robot through thoughts. Both companies continue to invest in innovation and science and engineering. The story of a bad economy and bad sales for a year or two is what you read in most newspapers. In my opinion the more important story is why Toyota and Honda will be dominant companies 20 years from now. And that story is based on their superior management and focus on long term success instead of short term quarterly results.

Yes Toyota can improve their performance, based on the last few years. Does management understand what they need to do? I think so. Does management understand that the system needs to be improved rather than the numbers on the spreadsheets of various managers have to be made better? I think so. Do I think most companies today, with bad results, understand the difference between bad numbers on spreadsheets that are used to judge various managers and a system that needs to be improved? No.

I do not believe the bad earnings for the last year for Toyota are indicative of a failed system. The results do show a weakness in the Toyota system that allowed them to perform this poorly during this credit crisis. The risk to Toyota’s future is that they become too focused on short term results, mistakenly thinking the problem to be fixed in the bad quarterly results recently. They need to focus on improving the system for the long term. And the recent experience likely shows some areas that need to be improved. But in no way do the fundamental tenants of the management system need to be changed. For many other companies today, changing fundamental aspects of their management is what is needed.

Related: Toyota as Homebuilder – Honda’s Robolegs Help People Walk – Honda has Never had Layoffs and has been Profitable Every Year – Toyota’s Partner Robot – NUMMI, and GM’s Failure to Manage Effectively – Toyota iUnit – Invest in New Management Methods Not a Failing Company by William Hunter, 1986
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