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Interruptions Can Severely Damage Performance

Posted on May 12, 2010  Comments (5)

Interruptions can severely degrade your performance. The type of work you are doing impacts the cost greatly. I have spent some of my time programming web applications. When I am doing that interruptions are huge drain on my performance (for me the costs of interruptions while programming are far higher than any other type of work I have done – many times higher). If the interruption disrupts my flow (an interruption needn’t necessarily disrupt it I found, instant messages may not, while speaking to someone else almost surely would – it is a factor of how much of your brain much shift focus I imagine) it can take a huge amount of time to get back into a high performing state. Other work I do can be interrupted with much less impact. I am easily able to slip back into what I was doing.

For me the main cost of interruptions is the time it takes to get back to where I was before the interruption. And the cost is related to how much focus is needed to address what you are working on. Most programming takes a huge amount of focus.

Another big cost of interruptions is the increased risk of mistakes. When people are distracted and then have to go back to a task, and then are distracted, and then go back and… it is more likely they will miss a step or miss noticing some issue than if they can work without distraction. One tool to help cope for distractions that can’t be designed out are checklists.

Paul Graham addressed the importance of managing the system to provide uninterrupted time very well in, Maker’s Schedule, Manager’s Schedule

One reason programmers dislike meetings so much is that they’re on a different type of schedule from other people. Meetings cost them more
…
Most powerful people are on the manager’s schedule. It’s the schedule of command. But there’s another way of using time that’s common among people who make things, like programmers and writers. They generally prefer to use time in units of half a day at least. You can’t write or program well in units of an hour. That’s barely enough time to get started.

Paul Graham’s article also shows why managers so often fail to adequately address this issue. Manager, by and large, work in an environment where interruptions are the work. I know, much of my time as a program manager is driven by interruptions and is doable even with many interruption every day.

When managing you need to understand how big a cost interruptions have and design systems appropriate to optimize system performance for all parts of the system. The design of the system needs to take into account the costs and benefits of interruptions for those people working on various processes in the system.

Related: Understanding How to Manage Geeks – Explaining Managers to Programmers – What Motivates Programmers? – Joy in Work – Software Development – Programmers Cartoon – Checklists in Software Development

Kiva – Giving Entrepreneurs an Opportunity to Succeed

Posted on April 3, 2010  Comments (1)

photo of a Kiva entrepreneur

Tony, a Kiva entrepreneur in Pennsylvania, USA looking to manufacturing specialty cars.

I really like Kiva. Kiva lets you lend small amounts of money to entrepreneurs around the world. My latest loan is to a manufacturing entrepreneur in the USA.

When Tony’s 6’0 6″ body could not fit in the traditional supercars, he built his own in 1990. Tony says, “If one door closes I just look for another opening; I don’t give up.” With much patience and hard work he continues to expand his business and hopes to make it a full-time job. With his ACCION USA microloan he has hired two designers to work with him part-time and has purchased a laptop.

I must admit I wouldn’t take this as an investment. It seems a very risky and doesn’t seem that likely to pan out, to me. But I see my loans through Kiva as a way to give people a chance to pursue their dreams. This loans is probably the one I find less compelling from a business point of view (to me), but I like to provide some loans in the USA so I decided to give Tony a chance.

I do try to select loans that look promising and seem to provide the entrepreneur an opportunity that will help them. By which I mean I love finding loans where, for example, they will buy equipment that will improve their productivity or take on new business. Very often loans are to buy raw materials or supplies, which is also fine but the potential gains are often less than something that improves the efficiency (it seems to me). Often this allows the entrepreneur to buy more and grow their business.

I have made nearly 200 loans now. The top country has been Togo (at 12%). I don’t target Togo but I do pay attention to the loan costs to the entrepreneurs (part of my assessment of the good business case for the loan) and some of the micro finance organizations offer good terms to entrepreneurs. Some of the microfinance organizations are more charitable (they may use donations to fund significant parts of the operating expenses, instead of profits from interest on the loans). Read more details on how Kiva works. It also used to be a bit difficult to find loans I really thought were great. It is getting easier to find more options so my guess is that the top few countries now will see declines in their percentages.

So far I have lent to 37 countries. Cambodia is 2nd at 7.7% of my loans, Viet Nam 3rd at 6.7%, Tanzania 4th at 5.1%, Nicaragua 6th at 5.1% along with Kenya, and Ghana and Boliva are 8th at 4.6%. The United States now makes up 2.6% and Mexico 1.5%. The sectors the loans are categorized in are: Services 25%, Food 18%, Manufacturing 17%, Retail 14%, Agriculture 12% and various others. Though the sector categorizations are pretty weak in my opinion (they seem to be fairly inaccurate – so it gives you an idea but it isn’t exact).

The default rate on my loan portfolio is 2.1% (3 defaults). One was in Kenya where $71.50 out of $75 was paid back and then huge civil unrest took place and it defaulted. The other 2 are from the same microfinance bank in Ecuador that was closed down due to mismanagement. In that instance I lost $87.50 out of $100 lent. 94 loans have been fully paid back and 94 are being paid back now.

I would love it if more Curious Cat readers joined Kiva and helped other entrepreneurs. If you do let me know your Kiva page and I will add you to the Curious Cat Kivans page. Also join the Curious Cats Kiva Lending Team.

Related: 100th Entrepreneur Loan – Thanksgiving: Micro-financing Entrepreneurs – Using Capitalism to Make the World Better – Kiva Opens to USA Entrepreneur Loans – MicroFinance Currency Risk

Aligning Marketing Vision and Management

Posted on March 23, 2010  Comments (3)

Why do so many companies market one thing and provide something else? I know it might be easier to sell something different than what you offer your customer today. But if you decide to market one vision, why don’t you change your organization to actually offer that?

I suspect this is substantially due to the outsourced nature of large marketing efforts. It makes sense to me that when you outsource your marketing message creation it isn’t tied to your management system and the two silos can pursue their own visions.

I would imagine marketers would claim they “partner” yada yada yada (and sometimes it actual seems to happen, but not often). As a consumer it sure looks to me like companies outsource marketing to ad agencies that come up with marketing plans that are not in harmony with the real company at all. I can understand putting a positive spin on things, but so much marketing is just completely at odds with how the company operates.

Treating a marketing message as something separate from management is a serious problem. When your marking message says one thing and your customers get something else that is a problem. I think the message is often based on what the executives wish the company was (and the outsourced marketers think it should be), but it isn’t the customer experience the management system provides.

If you believe the vision of your marketing then make sure your organization has embraced those principles. I think, often, companies would be wise to follow the vision their marketers came up with. But instead they tell customers to expect one thing and manage the organization to provide something else. I just don’t see how that is sensible.

Related: Marketing in a Lean Company – Packaging Improvement – Customer Service is Important – Confusing Customer Focus – Incredibly Bad Customer Service from Discover Card
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Improving Software Development with Automated Tests

Posted on March 8, 2010  Comments (7)

Automated software testing is a mistake proofing (poka-yoke) solution for software development.

The way automated testing works is that software code is written that tests the software code of the application. This automated testing code test that business rules are correctly being followed by the code in the application.

So for example, a user should not be able to create a new account without entering password. Then you create code that does not allow an account to be created without a password. And you write a test that passes if this is true and fails if it is false.

The best implementation will then not allow deploying code to your production environment until the code has passed all the automated tests. So if a software developer changes the code, the automated tests are all run and if there is an error noted by the automated testing the code cannot be deployed to the production environment. So, in the example above, if somehow the changes made to the application code somehow now let an account be created without a password the test would fail, and the developer would know to fix the problem before putting the code into production.

Thus automated testing mistake proofs the process. Now the mistake proofing is only as good as the test that are added. Software development is complex and if the code has an error (based on the business rules) that is not tested then the code can be deployed to production and affect customers. But it is a huge help in preventing many errors from affecting customers.

It seems pretty obvious but until the widespread adoption of agile software development techniques and frameworks that make it easy to adopt automated testing (like Ruby on Rails) this sensible process improvement tool was used far less often than you would think.

Related: Combinatorial Testing for Software – Metrics and Software Development – Checklists in Software Development – Google testing blog – Hexawise software testing blog

Circle of Influence

Posted on February 9, 2010  Comments (1)

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

Understanding Psychology: Slogans – Risky Tools

Posted on February 3, 2010  Comments (2)

De-motivation Poster

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

Soren Bisgaard

Posted on December 22, 2009  Comments (1)

photo of Soren Bisgaard

Soren Bisgaard died earlier this month of cancer. Soren was a student of my father’s who shared the commitment to making a difference in people’s lives by using applied statistics properly. I know this seem odd to many (I tried to describe this idea previously, also read his acceptance of the 2002 William G. Hunter award). Soren served as the director of the director of the Center for Quality and Productivity Improvement at the University of Wisconsin-Madison (founded by William Hunter and George Box) for several years.

Most recently Soren Bisgaard, Ph.D. was Professor of technology management at Eugene M. Isenberg School of Management at the University of Massachusetts – Amherst. He was an ASQ Fellow; recipient of Shewart Medal, Hunter Award, George Box Medal, among many others awards.

I will remember the passion he brought to his work. He reminded me of my father in his desire to improve how things are done and allow people to have better lives. Those that bring passion to their work in management improvement are unsung heroes. It seems odd, to many, to see that you can bring improvement to people’s lives through work. But we spend huge amounts of our time at work. And by improving the systems we work in we can improve people’s lives. Soren will be missed, by those who knew him and those who didn’t (even if they never realize it).

Contributions in honor of Søren may be made to The International Mesothelioma Program or to the European Network for Business and Industrial Statistics. Read more articles by Søren Bisgaard.

The Future of Quality Technology: From a Manufacturing to a Knowledge Economy and From Defects to Innovations (pdf) by Soren Bisgaard

Related: The Work of Peter Scholtes – Management Improvement Leaders – The Scientific Context of Quality Improvement by George Box and Soren Bisgaard, 1987 – Obituary Søren Bisgaard at ENBIS – Obituary: Soren Bisgaard, Isenberg Professor in Integrative Studies

Habits

Posted on December 10, 2009  Comments (3)

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

The Biggest Manufacturing Countries in 2008 with Historical Data

Posted on December 7, 2009  Comments (4)

Once again the USA was the leading country in manufacturing for 2008. And once again China grew their manufacturing output amazingly. In a change with recent trends Japan grew output significantly. Of course, the 2009 data is going to show the impact of a very severe worldwide recession.

Chart showing percent of output by top manufacturing countries from 1990 to 2008Chart showing the percentage output of top manufacturing countries from 1990-2008 by Curious Cat Management Blog, Creative Commons Attribution.

The first chart shows the USA’s share of the manufacturing output, of the countries that manufactured over $185 billion in 2008, at 28.1% in 1990, 27.7% in 1995, 32% in 2000, 28% in 2005, 28% in 2006, 26% in 2007 and 24% in 2008. China’s share has grown from 4% in 1990, 6% in 1995, 10% in 2000, 13% in 2005, 14% in 2006, 16% in 2007 to 18% in 2008. Japan’s share has fallen from 22% in 1990 to 14% in 2008. The USA has about 4.5% of the world population, China about 20%. See Curious Cat Investment blog post” Data on the Largest Manufacturing Countries in 2008.

Even with just this data, it is obvious the belief in a decades long steep decline in USA manufacturing is not in evidence. And, in fact the USA’s output has grown substantially over this period. It has just grown more slowly than that of China (as has every other country), and so while output in the USA has grown the percentage with China has shrunk. The percentage of manufacturing output by the USA (excluding output from China) was 29.3% in 1990 and 29.6% in 2008. The second chart shows manufacturing output over time.

charts showing the top manufacturing countries output from 1990-2008Chart showing the output of the top manufacturing countries from 1990-2008 by Curious Cat Management Blog, Creative Commons Attribution.

The 2008 China data is not provided for manufacturing alone (the latest UN Data, for global manufacturing, in billions of current USA dollars). The percentage of manufacturing (to manufacturing, mining and utilities) was 78% for 2005-2007 (I used 78% of the manufacturing, mining and utilities figure provided in the 2008 data). There is a good chance this overstates China manufacturing output in 2008 (due to very high commodity prices in 2008).

Hopefully these charts provide some evidence of what is really going on with global manufacturing and counteracts the hype, to some extent. Global economic data is not perfect. These figures are an attempt to capture the economic reality in the world but they are not a perfect proxy. This data is shown in 2008 USA dollars which is good in the sense that it shows all countries in the same light and we can compare the 1995 USA figure to 2005 without worrying about inflation. However foreign exchange fluctuations over time can show a country, for example, having a decline in manufacturing output in some year when in fact the output increased (just the decline against the USA dollar that year results in the data showing a decrease – which is accurate when measured in terms of USA dollars).

If the dollar declines substantially between when the 2008 data was calculated and the 2009 data is calculated that will give result in the data showing a substantial increase in those countries that had a currency strengthen against the USA dollar. At this time the Chinese Renminbi has not strengthened while most other currencies have – the Chinese government is retaining a peg to a specific exchange rate.

Korea (1.8% in 1990, 3% in 2008), Mexico (1.7% to 2.6%) and India (1.4% to 2.5%) were the only countries to increase their percentage of manufacturing output (other than China, of course, which grew from 3.9% to 18.5%).

Related: posts on manufacturing – Global Manufacturing Data 2007 – Global Manufacturing Employment Data – 1979 to 2007 – Top 10 Manufacturing Countries 2006 – Top 10 Manufacturing Countries 2005 – lean manufacturing resources

Making Better Decisions

Posted on November 24, 2009  Comments (3)

I think the most important thing you can do to make better decisions is to learn from the decisions you make. It sounds easy, but very few people do so effectively.

The best strategy to learn from decisions is to:

Highlights from Recent George Box Speech

Posted on November 16, 2009  Comments (4)

The JMP blog has posted some highlights from George Box’s presentation at Discovery 2009

Infusing his entire presentation with humor and fascinating tales of his memories, Box focused on sequential design of experiments. He attributed much of what he knows about DOE [design of experiments] to Ronald A. Fisher. Box explained that Fisher couldn’t find the things he was looking for in his data, “and he was right. Even if he had had the fastest available computer, he’d still be right,” said Box. Therefore, Fisher figured out how to study a number of factors at one time. And so, the beginnings of DOE.

Having worked and studied with many other famous statisticians and analytic thinkers, Box did not hesitate to share his characterizations of them. He told a story about Dr. Bill Hunter and how he required his students to run an experiment. Apparently a variety of subjects was studied [see 101 Ways to Design an Experiment, or Some Ideas About Teaching Design of Experiments]
…
According to Box, the difficulty of getting DOE to take root lies in the fact that these mathematicians “can’t really get the fact that it’s not about proving a theorem, it’s about being curious about things. There aren’t enough people who will apply [DOE] as a way of finding things out. But maybe with JMP, things will change that way.”

George Box is a great mind and great person who I have had the privilege of knowing my whole life. My father took his class at Princeton, then followed George to the University of Wisconsin-Madison (where Dr. Box founded the statistics department and Dad received the first PhD). They worked together building the UW statistics department, writing Statistics for Experimenters and founding the Center for Quality and Productivity Improvement among many other things.

Statistics for Experimenters: Design, Innovation, and Discovery shows that the goal of design of experiments is to learn and refine your experiment based on the knowledge you gain and experiment again. It is a process of discovery. If done properly it is very similar to the PDSA cycle with the application of statistical tools to aid in determining the impact of various factors under study.

Related: Box on Quality – George Box Quotations – posts on design of experiments – Using Design of Experiments

Learn Lean by Doing Lean

Posted on November 13, 2009  Comments (6)

In response to: Developing Your Lean Education Plan

If you actually let the lean leaders practice lean management you are probably doing more to help them learn than anything else. Reading is great, but 10 times better when reading to find solutions you need to deal with issues you have in place. Same for going to conferences. Consultants can be a huge help, but if you just bring in consultants without allowing the changes needed to improve they are not much use.

Far more damaging than not approving training, or giving the lean leaders any time to learn, is not giving them freedom to adopt lean practices and actually make improvements in your organization. That is what kills learning, and the desire to learn.

A great lean education plan: give them opportunities to apply what they know. As they gain knowledge and have success give them more opportunities. I think often lean leaders (and management improvement leaders) have to spend so much effort fighting the resistance in the organization they don’t have the energy to seek out much new knowledge. If you can reduce the effort they have to spend on fighting the bureaucracy most lean leaders will naturally focus on learning what they need for the current and future challenges.

Related: Building Organizational Capacity – Helping Employees Improve – People are Our Most Important Asset – Respect People by Understanding Psychology

Peter Scholtes

Posted on July 11, 2009  Comments (28)

photo of George Box, John Hunter and Peter Scholtesphoto of (from right to left) Peter Scholtes, John Hunter and George Box in Madison, Wisconsin at the 2008 Deming Conference

Peter Scholtes died peacefully this morning in Madison, Wisconsin. His family was with him.

My father wrote about the First Street Garage project in W. Edwards Deming’s Out of the Crisis (pages 245-247). Peter (who was working for the City of Madison at the time) and he became good friends working on that project together. Peter went to work for Joiner Associates afterwards and was a primary author of the Team Handbook. And Peter spent many years working with Dr. W. Edwards Deming and moving forward Dr. Deming’s ideas.

I would meet with Peter when consulted in Washington DC (which he did a good deal) and when I would visit Madison. He was extremely funny, compassionate, competent and effective. It was always a joy and educational to spend time with him. His Leader’s Handbook is the first management book I recommend to anyone. Peter enriched my life and the lives of many of others. And he will continue to do so through his works and those who were influenced by him.

Peter was a great friend and a wonderful person to talk with. I valued our shared interest in improving people’s lives by improving the practice of management. Peter was a priest before moving into management improvement. He retained his focus on helping people lead rewarding lives as a consultant. And we shared the desire to make the huge amount of time people spend working a much more rewarding experience. Making progress in that vein requires not just a wish to do so but the ability to learn and effectively apply ideas to affect real improvement. He was exceptionally gifted at this difficult task and was aided here, as with most things he did, by his considerable empathy and respect for others. His books provide evidence of this gift and effort. And those who were lucky enough to hear him speak enjoyed his ability to use humor to great affect in the effort.

In one of his last speeches, for example, when he speaking at the Deming conference (where the photo was taken) he used the action of kissing to underscore a point he was making about systems thinking and he described the challenges of gathering accurate data by recounting a radio interview he had heard about a research scientist who, in order to accurately assess the hibernation activities of bears, had to discretely sneak up on them during hibernation and well… take their temperatures in a non-genteel way.

I am very lucky to have developed friendship’s with several of my father’s friends. The photo shows me with two during my last visit to Madison: Peter and George Box.

It was a happy surprise when I found out Peter Scholtes wrote They Will Know We are Christians by our Love (link to a nice mp3 recording of the song). I think it is a wonderful song. Here are the words to that song (and a webcast is below):

We are one in the spirit we are one in the Lord
We are one in the spirit we are one in the Lord
And we pray that all unity will one day be restored

And they’ll Know we are Christians by our love, by our love
Yes they’ll know we are Christians by our love.

We will walk with each other we will walk hand in hand
We will walk with each other we will walk hand in hand
And together we’ll spread the news that God is in our land.

We will work with each other we will work side by side
We will work with each other we will work side by side
And we’ll guard each man’s dignity and save each man’s pride

All praise to the father from whom all things come
And all praise to Christ Jesus his only son
And all praise to the spirit who makes us one.

Continue reading →

Leadership

Posted on April 17, 2009  Comments (2)

Leadership is the act of making others effective in achieving an aim.

Leadership is not about being great yourself.

Leadership does involve more than making others effective. Leaders need to know what needs to be done, and then make others effective, based on that knowledge. As Dr. Deming said about any situation:

It is not enough to do your best; you must know what to do, and then do your best.

Leadership is not about getting a good performance appraisal. Leadership is not about making your numbers. Leadership is not about following the latest fad. Unfortunately, in my view, far too many managers fail to focus on making others better. Instead, probably largely influenced by performance appraisal mentality, they focus on making the case for why they, personally, are valuable.

Related: Deming on being destroyed by best efforts – 6 Leadership Competencies – The Leader’s Handbook – Seven Leadership Leverage Points – How to Improve – People are Our Most Important Asset – Bring Me Problems – Dr. W. Edwards Deming quotes

How We Know What We Know

Posted on April 9, 2009  Comments (6)

Dr. W. Edwards Deming’s management philosophy is a system of management composed of four interdependent areas: knowledge about variation, understanding psychology, systems thinking and the theory of knowledge. The theory of knowledge is the least understood, and the least adopted in the various other management improvement theories (lean manufacturing, six sigma, theory of constraints…). A recent op-ed in the New York Times touches on the ideas behind how we learn: Learning How to Think

The actor was introduced as “Dr. Myron L. Fox” (no such real person existed) and was described as an eminent authority on the application of mathematics to human behavior. He then delivered a lecture on “mathematical game theory as applied to physician education” — except that by design it had no point and was completely devoid of substance. However, it was warmly delivered and full of jokes and interesting neologisms.

Afterward, those in attendance were given questionnaires and asked to rate “Dr. Fox.” They were mostly impressed. “Excellent presentation, enjoyed listening,” wrote one. Another protested: “Too intellectual a presentation.”

So if you want to rate know if your consultants or trainers were entertaining maybe a survey is a good idea. Of course, if you want to know if people learned something useful that they can apply and make your business more effective a survey may not work so well.

The marketplace of ideas for now doesn’t clear out bad pundits and bad ideas partly because there’s no accountability. We trumpet our successes and ignore failures – or else attempt to explain that the failure doesn’t count because the situation changed or that we were basically right but the timing was off.

I think this sounds good, but wouldn’t work. In general, the way people build up beliefs, is full of all sorts of systemic problems. Like above, they tend to think someone entertaining is more educational than someone not entertaining. They may be more entertaining, but taking the ideas of those who are entertaining and rejecting the ideas of people who are not is not a great strategy to build up a great system of knowledge. To more effectively adopt good ideas and reject bad ideas, understanding the theory of knowledge (how we know what we know) and then apply that knowledge to how you learn is a better strategy. Learning to recognize confirmation bias and take steps to avoid it is one positive step. Learning to recognize when you accept ideas from those you like without critical judgment and reject ideas from those you find annoying and then learning to evaluate the ideas on the merits is another positive step you can take.
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Out of the Crisis Seminar

Posted on March 31, 2009  Comments (1)

I will be co-presenting an Out of the Crisis seminar for the W. Edwards Deming Institute next month, April 20-22, in Philadelphia.

Companies around the world are on the brink of destruction. When they get bailed out, or economies improve, they won’t survive if they continue to make products and provide services the same way as before, with the same style of management. They need to change.

It was the ideas of an American, W. Edwards Deming, that transformed Japanese industry after the devastation wrought by World War II. More than fifty years later, American businesses and much of the rest of the world find themselves in a somewhat similar position. Isn’t it time for American industry to wake up? Management practices need to change!

This seminar will help you work on transformation of management practices at your organization. It will show how current governance practice leads to the heaviest losses, how inconsistencies between policy and strategy create sub-optimal outcomes, how mismanagement of people leads to unethical and ineffective behavior. You will learn how to overcome these problems and focus on creating a system of continual improvement, just as Toyota and other Japanese firms did some fifty years ago.

You may find more information and register online. I hope to see you there.

Related: Deming Institute Conference: Tom Nolan – Louisville Slugger – Deming Practices – Curious Cat Management Improvement Calendar – 6 Leadership Competencies – Deming Conference 2005

Management Blog Posts From December 2005

Posted on March 30, 2009  Comments (0)

chart of executive pay 1990-2005

The executive pay excesses are so great now they will force companies to choose to:

  1. take huge risks to justify such pay and then go bankrupt when such risks fail (and some will succeed making it appear that the pay was deserved rather than just the random chance of taking a large risk and getting lucky).
  2. make it impossible to compete with companies that don’t allow such excesses and slowly go out of business to those companies that don’t act so irresponsibly.
  3. hope that competitors adopt your bad practice of excessive pay (this does have potential as most people are corrupted by power, even across cultural boundaries). However, my expectation is the competitive forces of capitalism going forward are going to make such a hope unrealistic. People will see the opportunity provided by such poor management and compete with them.

As long as the pay packages were merely large, and didn’t effect the ability of a company to prosper, that could continue (slicing up the benefits between the stakeholders is not an exact science). The excesses recently have become so obscene as to become unsustainable.

  • Innovate or Avoid Risk – “There are many reasons why avoiding risks is smart and should be encouraged. But when avoiding risks stifles innovation the risks to the organization are huge.”
  • Quality, SPC and Your Career – “I believe far too often we look for the newest ideas and miss all the great ideas that have been known for decades but are not practiced widely. The key to success is applying good ideas well – not just applying new ideas.”
  • America’s Manufacturing Future – “The best hope, as I see it, for retaining manufacturing leadership in the USA is through increasing the adoption of management improvement methods including lean manufacturing.”
  • Ford’s Wrong Turn – “The biggest change needed is an improvement in management. Other things would also help greatly, such as improving the health care system.”

Community Banks Asks Why They Must Pay for Wall Street Greed

Posted on March 7, 2009  Comments (1)

Minnesota Bank Asks Why It Pays for Wall Street Greed

TCF is among more than 8,300 banks and lenders insured by the FDIC facing increased fees and a one-time “emergency” charge designed to raise $27 billion this year for the agency’s depleted coffers.
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Community banks rely more on deposit funding, so they suffer a “much heavier burden” as a result of deposit insurance proportionate to size than peers such as New York-based Citigroup Inc. and Wells Fargo & Co., with its headquarters in San Francisco, Fine said.
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Community lenders “are feeling like they are paying for the incompetence and greed of Wall Street,” Fine said this week in an interview.
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FDIC assessments are set per $100 in deposits and not weighted by bank size. That’s a formula that could be modified to shift the cost burden to the largest banks “that caused this train wreck,” Fine said. TCF never “securitized anything, we never engaged in any of those unscrupulous activities,” said Cooper, 65.

I am not very surprised that politicians provide big favors to those that give them huge amounts of money (former investment banks, farming interests, private plane owners, Fortune 100 companies, owners of oceanfront mansions, private equity speculators…). I am a bit surprised how much money is being lavished on those huge donors now, with the bailouts. Especially with how lacking in even minor consequences those huge gifts to their donors are (normally if the payoffs to supports get too huge there are at least some cover provided by putting in consequences for this “need” to send taxpayer money to their contributors).

The FDIC is a great government program. But allowing huge banks to take enormous risks and then passing on the much of the costs, of a small portion of those risks (FDIC insured deposit accounts), to banks that do not act as irresponsibly as the risk takers is a bad idea. Insurance should have increasing costs based on increasingly risky behavior.
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Mount Timpanogos Trail, Utah Photos

Posted on January 25, 2009  Comments (0)

Photo on the Mount Timpanogos Trail by John Hunter

In 2007, I kept failing to plan for a vacation, finally I just booked some tickets to Utah without much of a plan. And still had done little to plan as I departed. So I bought some travel books and started on the trip while I was figuring out where I should go. I did know Utah offers amazing hiking options and I found many great hikes that made for a great trip.

The first day of the trip began in Salt Lake City and then a visit to Antelope Island State Park in the Great Salt Lake. The next day I hiked the Mount Timpanogos Trail (where the photos on this page are from). The following morning I enjoyed the Timpanogos Cave National Monument. The Mount Timpanogos area is about an hour from Salt Lake City. My trip continued to the Dinosaur National Monument. Once I add more of the photos to my travel site, I will add a new post here.

Related: Curious Cat photos while hiking through National Parks – Wind Cave and Jewel Cave – Grand Teton National Park Continue reading →

Federal Government Chief Performance Officer

Posted on January 15, 2009  Comments (0)

A Quality Manager for Obama

President-Elect Obama has hired a quality manager, and her name is Nancy Killefer. She is the newly appointed “Chief Performance Officer” whose mandate is to manage budget reforms while eliminating waste in government processes, ultimately making it more effective. An MIT & McKinsey alum, Time calls her the “first official waste watchdog.”

Previous administrations have had exactly the same thing (regardless what Time magazine says), so I don’t think we should get carried away. Eliminating wasteful government spending is a refrain from every new administration. She will be running the Office of Management and Budget (OMB) and have this new title “Chief Performance Officer.” OMB has been the official waste watchdog, for at least decades. They are far from understanding muda. Time will tell if there is any change on that score going forward, I am skeptical.

Here is very typical OMB language from a 1995 memo by Alice M. Rivlin, Director of OMB:

Management controls are the organization, policies, and procedures used to reasonably ensure that (i) programs achieve their intended results; (ii) resources are used consistent with agency mission; (iii) programs and resources are protected from waste, fraud, and mismanagement; (iv) laws and regulations are followed; and (v) reliable and timely information is obtained, maintained, reported and used for decision making.

I worked with improving management in the federal government at the Office of Personnel Management, Office of the Secretary of Defense, Quality Management Office and the White House Military Office. I was one of the founders of the ASQ Public Sector Network (now Government Division) and have managed the Public Sector Continuous Improvement Site since 1995. There have been plenty of great efforts to improve management in government that have made real progress. But there is much more that needs to be done.

There are complications in applying management improvement in government but they are fairly minor comparatively. In general, the difficulty is not the necessary adjustments for a different environment than the private sector, but similar challenges to improving private sector management.

In 1982, The Grace Commission provided a report to the Regan Administration. Radio Address to the Nation on the Management of the Federal Government by Ronald Reagan, October 29, 1988

“We also set up the Private Sector Survey on Cost Control led by Peter Grace — almost 200 top business executives. This Commission spent months looking at every part of the Government, finding out where modern business practices could eliminate waste, fraud, and abuse in the Government. When they were through, they’d come up with 2,478 suggestions. And almost every recommendation we could put into effect without congressional action has been implemented. And we’ve saved close to $80 billion. We’re hoping that the next Congress will pitch in and do its part.”

The Clinton administration had the National Performance Review which was the closest thing to an attempt to move toward my concept of management improvement.

The current administration had their own President’s Management Agenda. Government Accountability: Efforts to Identify and Eliminate Waste and Mismanagement Hearing before the Committee on International Relations, House of Representatives, September 4, 2003.
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