In, The Seven Habits of Highly Effective People, Steven Covey discusses the circle of control, circle of influence and circle of concern. This provides a good framework from which to view issues as you look for improvement strategies.

Within your circle of control you have much more autonomy and have less need to win others over to your plan. However, in practice, even here, you benefit from winning over those who are involved (for example you are their boss).

Our circle of concern covers those things we worry about. Often, we believe because we worry we should find solutions. Problems that fall into this category (but outside our circle of influence) however often prove difficult to tackle. And often people don’t understand why they get frustrated in this case. You can save your energy for more productive activities by seeing some things are outside your influence and avoid wasting your energy on them.

A problem with this, I see in practice however, is that if you are creative many things that people think are beyond their influence are not. With some imagination you can find ways to have influence. Good ideas are powerful. And often that is all that is needed for influence is offering a good idea.

Understanding to what extent an issue is within your control or influence can help a great deal in determining good strategies. Where you have a good chance to influence the process you can focus on strategies that may require much more of your participation to be successfully adopted. As you have less influence such a strategy is likely a poor one.

You should remember, that there is a temporal component to your circle of influence. On some current issue, I may have a very low chance of success for getting the organization to adopt an improvement I think is best. But certain actions can build the understanding that will allow me later to have more influence. This can even be completely separate from how people normally think of circle of influence. By building an organization that moves toward data based decision making and therefore reduces HiPPO (Highest Paid Person’s Opinion) decision making I increase my ability to influence decision making in the future.

Long term thinking is a very powerful, and much under-practiced, strategy. Your influence within an organization is limited today but has great potential to expand, if you act wisely.

Thinking about the extent a current issue falls within your sphere of influence is important it determining the best strategies. But the most valuable insight is to understand how import your sphere of influence is. It determines what strategies you can pursue. And building your sphere of influence should be part of your decision making process.

By taking the long view you can put yourself in good positions to have influence on decisions. There are many ways to do this. My preferred method is fairly boring. Prove yourself to be valuable and you will gain influence. Help people solve their problems. They will be inclined to listen to your ideas. Provide people useful management tools and help them apply them successfully. Help get people, that you know are good, opportunities to succeed. Often this gains you two allies (the person you helped gain the opportunity for and the person that was looking for someone to step in). Work hard and deliver what is important. It isn’t some secret sauce for quick success but if you make those around you successful you grow your circle of influence.

Related: How to Improve – Helping Employees Improve – Operational Excellence – Management Advice Failures – Management Improvement

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

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

Slogans mainly are bad. But like most things they can be used in ways that help or hurt. The main problem is when they substitute for a method to achieve the aim (most of the time). If the slogan serves like a mission statement to focus people on something useful to focus on and it is one minor part of a system to achieve a result it can be fine and even useful.

The issue, to me, is not so much that slogans are innately horrible. It is that, in practice, slogan are used in harmful ways most often (especially outside of sports). They tend to substitute for system improvement. The main work of shifting psychology (we do expect to win now, we do expect a focus on reducing bugs in our code…) after years of creating a different culture has to be in changing methods, priorities, values… Slogans, if done right, can be a way of focusing on the change. Or they can be a real reminder of values. But the slogan only provides value as part of a system confirming the aim they emphasis.

Unfortunately, they also to be used as a way to focus criticisms on individuals. Don’t you know/care that our slogan says zero defects? Can’t you read? Jeez, I even put up a huge poster with our slogan saying zero defects and you can’t even do what it says in this beautiful poster? Well, I will give you a bad performance review now, you can’t say you don’t have that coming after you failed to do what our slogan told you to do.

A slogan by itself has negative value. Take any wonderful slogan and move it somewhere else it will do more harm than good. As a minor part of a system though it can tap into how we people think and act (psychology) and provide value. Be careful though, it is much easier to do harm with slogans than to provide value.

If the slogan emphasizes what is being practiced every day, it can be a helpful reinforcer. If it conflicts with what is done every day it breeds cynicism and shows disrespect for people. This which is a huge problem. And managers have to know it is very easy for people to see the lack of cloths on the emperor slogan. Dilbert does a great job showing the risks of using slogans. Those you are targeting the slogan to are more likely to think like Dilbert than the they are to think like the pointy haired boss (and if you are the one pushing the slogan that means you are well on your way to being the phb – so be careful).

Slogans clearly fall under Deming’s understanding psychology area of management. To use them effectively you need to make sure the value provided, exceeds the cost and risk. I see no better way to evaluate slogans than through the lens of Deming’s system of management, interdependent components of: psychology, systems thinking, understanding variation and theory of knowledge. If the slogan is not supported by they system of management in place it will do harm.

In response to: Are Slogans Always Bad or Can They Inspire?

Related: Deming on eliminating slogans and motivational posters – Eliminate Slogans – Toyota Targets 50% Reduction in Maintenance Waste – posts on psychology – How to Improve – Stop Demotivating Employees

The Curious Cat Management Improvement Carnival provides links to recent articles to help managers improve the performance organization.

• Lean in Sweden: Tools < Thinking by Mark Graban – “Tools have some value, but only in context of lean thinking and the lean management philosophy. Tools aren’t value-less, but thinking is better.”
• Manufacturing starts to come home by Dan Markovitz – “NCR sees domestic manufacturing as key to increasing sales as well. It enables them to make higher value-added products that their customers want.”
• Correlation or Causation? Interceptions and the Playoffs by Jeff Hajek – “this is a classic case of confusing correlation with causation. If this data truly was a cause and effect relationship, meaning interceptions caused losses, fixing the problem would be simple… If you never threw the ball, you could win nearly four out of five times.”
• Learning from Toyota’s Stumble by Steven Spear – “But as we are now sadly seeing, the capacity for developing people can be overstretched. It was not recognizing this and succumbing to the temptation to make growth its first priority that led to Toyota’s current problems.”
• When in doubt, timebox it by Mark Imbriaco – “If we can solve the compatibility problems in those 30 minutes, it will be a nice win and we can make use of the plugin that we want to. On the flip side, we already have a known solution to the problem.”
• Be Proactive – Prevent your problems! by Sonja Hughes – “Monitoring process performance through statistical process control or other performance measures allows us to detect changes or trends so we can take appropriate action before problems occur.”

(more…)

Gipsie B. Ranney has a great new article – The Trouble with Incentives: They Work

She sums it up very well:

Find more articles on management improvement in the Curious Cat Management Improvement Library, including: An Interim Report on Motivation in the Workplace by Gipsie Ranney, Remembering NUMMI by Gipsie Ranney and Improving Problem Solving by Ian Bradbury and Gipsie Ranney.

When you can’t prevent arbitrary targets and rewards based on meeting them the strategy I attempt to put in place is figure out how the system will be distorted in order to meet those targets and then put in measures that will discourage such distortions. It isn’t perfect but can help prevent some of the worst distortions (and degradation of system-wide performance they cause).

Related: Righter Incentivization – The Defect Black Market – Dr. Deming on the problems with managing with targets (and incentives based on them) – Extrinsic Incentives Kill Creativity

The practice of stopping (either the machine automatically detecting a problem and stopping or a person stopping) the line when a problem is detected is part of Jidoka. Jidoka is also highlighting and making problems visible. Jidoka and Just in Time are the two pillars of the Toyota Production System. Today Toyota practiced Jidoka on a large scale: Toyota Halts Sales of Eight Models After Recall

My guess is there are quite a few people in Toyota that are getting a frustrated that they continue to have problems that they have been unable to successfully address. This strikes is as the kind of action initiated near the top of the organization chart to remind the organization that problems must be addressed immediately. It is not ok to continue business as usually when problems have not been addressed in the Toyota Production System. Toyota is capable of failing to live up to the principles of lean manufacturing. But they also seem to understand this risk and continue to strive to improve. To succeed though they need to improve results – intentions alone are not enough.

Related: Cease Mass Inspection for Quality – Recalls at Toyota and Sony – Reacting to Product Problems – Workplace Management by Taiichi Ohno

This is an interesting video on Deming and American management (by the BBC in 1992): Prophet Unheard. It includes some nice old footage of Deming in Japan. The importance of respect for people is clear and the video also touches on the idea the danger of relying on data (when you do not understand variation and that many important matters and unmeasurable). The video features many snippets of Dr. Deming speaking and includes Don Peterson, Ford CEO; Clare Crawford Mason, If Japan Can, Why Can’t We producer; and Myron Tribus.

Related: Dr. Deming Webcast on the 5 Deadly Diseases – Red Bead Experiment Webcast – Performance without Appraisal – management webcasts

Part two of the documentary explores the Deming Prize, understanding data and the PDSA cycle:
(more…)

The collection of posts from 10 blogs that made up the 2009 annual management blog are counted as Management Improvement Carnival #85, making this post #86.

• Are Slogans Always Bad or Can They Inspire? by Mark Graban – “Why are slogans bad? Dr. Deming writes, in part, ‘They are directed at the wrong people. They arise from management’s supposition that the production workers could, by putting their backs into the job, accomplish zero defects, improve quality, improve productivity, and all else that is desirable.””
• Fail, Learn, Lead by Jamie Flinchbaugh – “we don’t want to encourage people to make mistakes, but what do we want? We want people to surface mistakes or errors as they occur. We want them to own them and fix them. And we do want them to learn from them when they do occur”
• Five Change Management Errors that Make You Wish You’d Read this Article Sooner by Jon Miller – “it’s best to spend most of the time debating the guiding principles and values of lean in order to gain deep alignment, and then let the tools and specific solutions follow from that.”
• Joy, hope, and lean by Karen Wilhelm – “I think it’s joy and hope that propel continuous improvement. We’re just humans, with primitive brains that run on emotions more often than on facts and figures.”
• Motiv’s Scott Wilbur Teaches Brunswick a Lesson by Kevin Meyer – “Brunswick moved a bowling ball factory from Michigan to Mexico to chase cheap labor… and paid for it in quality. Meanwhile Scott Wilbur decided to stay behind, started Motiv, and became profitable making bowling balls in Michigan.”

(more…)

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

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

I am skeptical that this reality show (Undercover Boss) will actually do any good but the webclip looks fun. It will premier right after the Super Bowl on CBS.

The concept, if done right, could actually be interesting. But even in that case, I would be skeptical it would do much good. I may be wrong, but I would think we will get a whole bunch of thoughts based on one single data point (no appreciation of a system, no understanding variation, no understanding psychology – just playing to psychology, and no understanding of how we form beliefs). My guess is the show will largely be having fun with making bosses actually do physical and customer service work. And probably the bosses trying to appeal to the common working man with admiration about how hard this work is.

They then will go back to their overinflated salaries and continue to limit the rewards for those they spoke so highly of while TV cameras rolled, and in general practice disrespect for people not respect for people. If it actually gets a few MBAs to stop managing by spreadsheet and start actually managing with an understanding the business systems they manage that would be great.

Going to the Gemba, where the rubber meets the road is great. But unless the management systems are in place to improve it is more like a site-seeing trip than a management tool. More like those people that go to a working ranch for a vacation (where they work on a ranch) to experience something new before returning to their normal life.

via: Dan McCarthy, How to be an “Undercover Leader”. He is more hopeful than I am about the show.

Related: Management Advice Failures – How to Improve – The CEO is Only One Person – Management Improvement

10 management blogs are participating in the 2009 Management Blog Carnival. Be sure to check out all the great posts. Here we are looking at some exceptional posts on the , Training Within Industry and Making IT Clear. The quotes below are taken from blog posts on these blogs (and include links to the posts they are taken from)

Visual Management Blog by Xavier Quesada Allue

“Visual Management is the practice of using information visualization techniques to manage work. A simple example is using sticky notes on a wall to manage a list of tasks, a better (and more complex) example is kanban.”

Agile and lean management both stress to the importance of making work in process visible. With agile software development workload is often managed using short iterations to create software code and deploy it (similar to continuous flow). “The goal is that any team can do any story in the backlog. You should stress that the ‘real’ Team is the big one. Sub-teams are just created for communication and coordination purposes. In my opinion, they should not develop too strong a team identity. For example, I would not measure sub-team velocity, and I would make sure people rotate from sub-team to sub-team a lot.”

Short software development iterations “require both soft and hard commitments from team members. The team is required to work as a team (for which soft commitment is required) and to commit to finishing a certain amount of work in one Sprint.”

Training Within Industry by Bryan Lund

Another method of making in process work clear is to make clear what the process is.
Building up Standard Work Using Job Instruction explains why job instruction is critical skill that supports standardized work, in that training is used as a countermeasure against variability. An important idea that is far to often ignored.

“The primary purpose of a Job Breakdown Sheet is to serve as a trainer’s aid. It is not meant to be read by the trainee.” and “My experience is that Work Instructions are used so a number of objectives may be achieved”: reduce training time, have trainees more directly involved with training and compliance and accountability through a a chain of approvals.

Early in the year Bryan included a series of lean comics, including:

Making IT Clear by Harwell Thrasher

Harwell Thrasher focuses on explaining IT issues to a business audience, and giving business people advice on how to improve the effectiveness of their IT organizations. “IT doesn’t succeed because of technology — it succeeds because of its contribution to the business.”

He has several posts with straight forward ideas for managers such as How to Become a Manager – 13 Skills You’ll Need: “Obstacle Removal… Part of your job is to remove the obstacles that are preventing your employees from doing their best.” Managers responsibility to intervene in the system to remove obstacle preventing people from doing their best is a big key to management I believe. One great thing about agile software development is how clearly this is shown to be a project managers responsibility.

As he says in The 7 Biggest Challenges of a Manager “If you ever get to the point where you honestly have no idea how to improve things further, then you should either (a) seek outside advice, or (b) look for another job. There’s always a better way, and you have to keep looking for it.”

“Most technical people who become managers do so because they want more scope and control… perhaps most important, you don’t become a good manager by being good technically – you become a good manager by being able to get things accomplished through other people.”

Take a look at the full list of posts pointing to excellent posts from over 30 management blogs from 2009.

Related: 2008 Curious Cat Management Carnival – Management Reddit – Curious Cat Management Search

The 2009 annual management improvement blog carnival continues with more bloggers posting highlights from some of their favorite management blogs (see 2009 Annual Management Blog Review Part 1). Kevin Meyer looked back through the posts from TimeBack Management, Lean Six Sigma Academy, Curious Cat Management Improvement, A Lean Journey, and Stats Made Easy and found some gems, including

• 7 Practical Ways to Respect People by Ron Pereira
• Sustainability: Ten Factors for Making Culture Change Stick by Tim McMahon
• Experiments for school now safer, but less educational by Mark Anderson
• Standardized Work: The Source of Creativity by Dan Markovitz
• Five Managerial Fallacies Concerning Layoffs by John Hunter

Dan Markovitz reviewed the Lean blog, Evolving Excellence and Jason Yip’s blog. Highlights include:

• This Year’s WSJ “JIT”-Bashing Article by Mark Graban
• The Toyota version for Information Refrigerator by Jason Yip – “When told of plans to use an IT system to monitor and control flow of a certain type of inventory, Hideshi Yokoi’s response: ‘When you put problem in computer, box hide answer. Problem must be visible!’”
• Chief Brain Officer by Kevin Meyer
• When The Neck Bone Isn’t Connected To The Head Bone by Bill Waddell

Hank Anderson has highlighted posts from the Hexawise blog for Stats Made Easy. Mark Anderson has reviewed Work Matters and will be reviewing Seth Godin in an upcoming post. Highlights from the Hexawise blog include: What Else Can Software Development and Testing Learn from Manufacturing? Don’t Forget Design of Experiments (DoE) by Justin Hunter, my brother.
(more…)

The more you pay for your hotel room the more likely they will charge to provide decent WiFi in your room. Whether a company tries to rip you off with exorbitant prices, or lousy service, is just a function of their lack of respect for customers. Obviously it is cheap to provide decent WiFi (as staying at numerous cheap hotels shows – nearly all offer WiFi completely free).

Most expensive hotels show they do not respect their customers. Some actually do rise to the level of a typical budget, and cheaper, hotels and motels so it isn’t all expensive hotels that fail to meet this low standard. The management of those hotels come from the same school of management thought that produces our bankers.

Jeff Bezos captures one difference between poor managers (prevalent in many spreadsheet focused managers) and lean manufacturing managers with the quote: “There are two kinds of companies, those that work to try to charge more and those that work to charge less.”

Thoughts on: Hotel WiFi Should Be a Right, Not a Luxury

Related: Making Life Difficult for Customers – Verizon Provides Lousy Service = Dog Bites Man – Is Poor Service the Industry Standard?

The 2009 annual management improvement blog review is underway. Jamie Flinchbaugh found excellent posts from In Pursuit of Elegance, Shmula blog and Got Boondoggle? Those posts include:

• The Art of Symmetry: Fractals and the Mandelbrot by Matthew May
• Respect for People, Underutilized People, and Waste by Pete Abilla
• Get Your Boots On! by Mike Wroblewski

Mark J. Anderson has highlighted posts from Work Matters and will be reviewing Seth Godin and the Hexawise blog in upcoming posts. Highlights from Bob Sutton include: Intuition vs. Data-Driven Decision-Making: Some Rough Ideas.

Jon Miller scoured the Lean is Good, Daily Kaizen and Jamie Flinchbaugh and has posted valuable highlights, including:

• Policy Deployment #4 – Catch Ball by Bryan Zeigler
• It’s All About the Why, the Other Why by Bruce Baker
• Three Ways to Root Cause by Lee Fried

Be sure to check out each carnival post and each of the posts they highlight. The review shows how much excellent material is published on management blogs. 2009 Management Improvement Blog Carnival provides links to the carnival posts noted above, and will include others as they are posted. This is the second year we have posted an annual management blog review: 2008 management blog review.

Reading these posts will give you plenty of ideas to help you make the new year a happy year.

Over the next 2 weeks several management blogs will be posting their contributions to the 2009 year in review of management blogs. Posts will highlight some of the best posts on other management blogs in the last year.

The home page of the 2009 review of management blogs will be updated as new posts are added.

The hosts of the 2009 management blog carnival include the: Lean Blog,
Jamie Flinchbaugh, Stats Made Easy, Gemba Panta Rei and Lean Reflections.

See the 2008 year in review for management blogs. See management improvement carnival posts.

Robert Lloyd, PhD From the IHI Open School’s, presents a nice overview of the PDSA Cycle (plan-do-study-act). The webcast includes an example of using PDSA to improve the discharge process for a hospital.

As I have said many times the keys to success are to turn the PDSA cycle rapidly, predict the results in advance, and analyze the results to continually improve. the Improvement Handbook is an excellent resource.

The IHI Open School is a great resource and exactly the type of thing organizations with a mission to improve performance should be doing. Provide resources online that are easy for people to access and then apply in their organization. See more management webcasts.

Related: Tom Nolan on PDSA – Saving Lives: US Health Care Improvement – 5 Million Lives Campaign

The CEO is important but they are only one person. Rarely do they determine the success of a company. The instances where they seem to are so rare as to almost seem like just random luck. I think they can make a difference, but that they make a significant difference rarely. Steve Jobs seems to have made a huge difference to Apple, for example (and Jeffery Bezos at Amazon – note both of these examples are also founders of the company). Jason Zweig has a good article on Why a New CEO Isn’t Always a Panacea

The management system is far more important than one person. Jim Press, Toyota N. American President, Moves to Chrysler (don’t expect much – Sept 2007). We are often fooled by randomness (understanding psychology lets you know this truth and factor it into your thinking): Illusions – Optical and Other, Attributing Random Results to a Special Cause, Seeing Patterns Where None Exists.

CEOs like to think they are royalty and take huge amounts of money from the company’s treasury, as a way, they hope, of providing evidence of this false belief. Don’t be fooled.

Jason Zwieg is the editor of the last few issues of the Intelligent Investor where he adds commentary on Benjamin Graham’s classic.

Related: Narcissistic Cadre of Senior Executives – CEO’s Given Lottery Sized Payouts – Diversification not Dazzling in Investing – Tilting at Ludicrous CEO Pay 2007 Edition

The Curious Cat Management Improvement Carnival provides links to recent blog posts on improving the management of organizations.

• How Do You Get from Here to Agile? Iterate. by Mike Cohn – “…following an iterative transition process. Making small changes on a continual basis is a logical way to adopt a development process that is itself iterative.”
• What is Lean? by Mike Wroblewski – “Do we measure leanness on the number of lean tools being used? Let’s see, 5-S check, Kanban check, Regular kaizen events check, A3 no, TPM no, VSM no, (add as many tools to your checklist as your experience tells you)….sorry you are not lean…”
• How to Deal with a Bad Boss — 3 Approaches by Harwell Thrasher – “There are basically three approaches to dealing with a bad boss: leave, get rid of the boss, or make the situation better.”
• Defining the Problem Statement by Tim McMahon – “The problem statement should not address more than one problem. The problem statement should not assign a cause. The problem statement should not assign blame. The problem statement should not offer a solution.”
• Hospitals Saving Millions with Staff Suggestions by Mark Graban – “The baseline number that Norman Bodek often cites for companies like Toyota or Canon is that the company saves $4,000 per employee based on employee kaizen suggestions.”
• How Much Time In Gemba? by Lee Fried – “Each leader has very clear standard work which includes checking on local standards, progress of improvements and walking frontline processes.”
• 2 Quick Tips on Meetings by Jamie Flinchbaugh – “First, consider if you even need the meeting to begin with…”
• The Advantages of A1 Thinking Over A3 Thinking by Jon Miller – “The A1 thinking document is four times larger than the A3 document. It is big. You can read it from across the room. The caveat is that you have to write at least four times as big as you would on an A3. Don’t use the extra space to cram in more information!”
• Historical Data on the Largest Manufacturing Countries by John Hunter – The first chart shows the USA’s share of the manufacturing output… at 28.1% in 1990, 32% in 2000, 28% in 2005, and 24% in 2008. China’s share has grown from 4% in 1990, 10% in 2000, 13% in 2005 to 18% in 2008.

Related: Curious Cat management articles – Curious Cat Economics and Investing Carnival

Some things about what people do also have their roots in psychology. Deming had an understanding of psychology as one of 4 areas in his system of management. A huge factor in what people do is based on what they are used to doing – habits. It is often difficult for people to change – not necessarily because they don’t want to, or the alternative is more difficult or they think it is unwise. It is difficult just because they are in the habit of doing something else.

William James explored the power of habits – The Laws of Habit

Often I favor convincing people why certain actions are best and then they can chose to take those actions. But you can also get people in the habit of the actions you seek to encourage and then let the power of habit work. For health, I think this, often is a good strategy.

But it also is done in many ways that culture is established in an organization. You enforce that meetings must have an agenda. Then it becomes a habit. You enforce that decisions are based on data. Then it becomes a habit. You enforce that the work area must be clean. Then it becomes a habit.

Two ways you can notice that things are becoming a habit:

1) when people bring “work” ideas to their personal life – Visual Management and Self-Reliance, Laundry Kaizen.

2) you find yourself in a new environment where the habit is not practiced and you are uncomfortable. You go to a new organization and 5s is not being practiced and you feel uncomfortable. You go to meetings without agendas and they seem to wander and waste time and you can’t imagine why they don’t use an agenda and follow it.

When the ideas have reached the level of habits you have changed. I think with health issues this is the understanding people should have. How do I change things so people adopt good habits. Then you have to find strategies that effectively move people to adopt those habits.

The strategy is based on the idea that adopting the habit can be easier than convincing someone to change with the power of pure logic. But it is also important as habit are adopted to explain the reasoning on why the habits are important. By understanding the role those habits play in successful health, for example, a person knows how to adapt to changing circumstances. And they know what are the key factors that should remain as methods are adapted over time. Explaining why 5s is valuable is important even beyond the habit.

If you get someone to behave in a certain way to get some incentive you rarely get the change in psychology. They don’t adopt a new habit. They do something to get what you offer. They will continue to do it if the incentive is offered. If not, they stop. Does Rewarding Children Backfire?

In response to: In search of metrics

Related: Flaws in Understanding Psychology Lead to Flawed Management – Respect for People, Understanding Psychology – Information Technology and Business Process Support – Punished by Rewards? A Conversation with Alfie Kohn

Henry Mintzberg, wrote an excellent article for the Wall Street Journal today, No More Executive Bonuses!

It is an great article on bad pay systems that let a few top executives (and their hand picked board members) in many companies to loot the treasury of the company. I have written about this problem many times, including: CEOs Plundering Corporate Coffers – Excessive Executive Pay (2005) – Narcissistic Cadre of Senior Executives – The Best Leadership Is Good Management – Another Year of CEO’s Taking Hugely Excessive Pay – More on Obscene CEO Pay – More on Failed Executives

There are executives that don’t act like corrupt dictators looting their country, unfortunately they are less common than those that act like looters. And they all seem to have built cultures that taking respect for people is more important that feeding a few bloated egos. Akio Toyoda’s Message Shows Real Leadership, Tony Hsieh, the Zappo’s CEO – Warren Buffett – Honda has Never had Layoffs and has been Profitable Every Year

The obscene pay is not just a matter of people taking a tens of millions of dollars they don’t deserve. Companies whole management systems are distorted in ways that lead the company to risk all the other stakeholders future for the potential gain of a few senior executives.