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  • Losses Covered Up to Protect Bonuses

    Does it surprise you to learn traders would cover up losses to protect bonuses? It shouldn’t, it happens over and over. Would it surprise you that almost any bonus (or quota) scheme increases the odds that the data will be doctored to meet the goals? It shouldn’t. Intelligent measures to make such doctoring difficult can help reduce the practice. But it is a likely risk of any such goal.

    As we have quoted Brian Joiner as saying: there are: “3 ways to improve the figures: distort the data, distort the system and improve the system. Improving the system is the most difficult.” So it is no shock that distorting the data is often the tactic people use (especially when the rewards are great or the punishment for missing is severe).

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  • Unconscionable Executive Pay

    The behavior of executives that take what they have no right to in unjustifiable pay schemes continues to be a disgrace... Excessive executive pay is both a sign of awful ethics and a driver of bad management action.

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  • Interview of Bill Hunter by Peter Scholtes on Statistical Variability and Interactions

    For some processes it is enough to know a couple important variables and have an understanding of how they interact to impact results. Often though problems are created because the organization doesn’t learn enough about variables that can have a substantial impact on results and therefore feels blindsided by poor results. In some of those cases they were blindsided not by unforeseeable random factors but by variables they should have learned about. And then based on that knowledge designed their processes to take into account the potential impact of variations in that variable...

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  • Management Advice from Warren Buffet

    Charlie and I look for companies that have a) a business we understand; b) favorable long-term economics; c) able and trustworthy management; and d) a sensible price tag. We like to buy the whole business or, if management is our partner, at least 80%

    A truly great business must have an enduring “moat” that protects excellent returns on invested capital. The dynamics of capitalism guarantee that competitors will repeatedly assault any business “castle” that is earning high returns.

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  • Using Customer Feedback to Drive Continual Improvement

    That impact of creating systems that continually improve the value provided to customers is still very much under appreciated. The Deming Chain Reaction is such a powerful concept that allows us to create more value and reduce costs over the long term.

    ...

    Long term thinking with an appreciation for systems allows managers to focus on improving value over the long term while many of their competitors focus on reducing current costs no matter how much damage they do to their customers and the long term success of their business.

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  • Profound Podcast with John Hunter, Part Two

    In this podcast I discussed my thoughts on management improvement, Deming, respect for people, systems thinking and more.

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  • Alzheimer’s and the Complex Scientific Inquiry Process

    Medical research is complex. Once we figure out what is most critical and discover effective treatments often the explanations can then make it seem fairly simple. But that process is often decades of efforts that include years of frustration and confusion.

    For long term medical impacts we often need to guess at important biomarker indications that may be closely related to health outcomes. But that process often isn’t as easy as it sounds.

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  • Profound Podcast with John Hunter – Curious Cat

    In this podcast I discussed a bit of my history with management improvement. My father introduced me to the ideas as I was growing up.  And that became formal during high school, when I attended a class for City of Madison employees (during the summer) on management improvement (Deming included a couple pages on those efforts in Out of Crisis).  I also discussed: Design of Experiments, Peter Scholtes, W. Edwards Deming, PDSA cycle and six sigma.  This podcast is part one of the interview.

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  • Capital Crescent Trail Photos (Washington DC)

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

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  • Confusing Improving A Proxy Measure with Actually Improving the System

    The more experience you gain trying to improve, the better you become at improving. That journey is not easy, but it is very rewarding. I find keeping your sight on the long term is a great help. If you focus too much on the short term (which is very easy to do), it is easy to become so invested in achieving a short-term success that you seek to find numbers that let you claim victory. That is the death of efforts to improve.

    It is just so easy to find some numbers that can be used to declare victory no matter how badly things are really going. Instead, accept that there will be many short-term failures and short-term successes, but each of those are fairly minor data points on the long term journey to create an organization that continually improves day after day, week after week, month after month, and year after year.

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  • Interview of Bill Hunter, Brian Joiner and Peter Scholtes on Better Management Practices

    That kind of experience could not have happened if management wasn’t willing to listen to the workers and wasn’t willing to say to the workers “you have brains and you have ideas and why don’t you go out and see if you can solve it and I will back you up. And that is what they did

    Bill on creating jobs people want to do:

    If they are going to work with the attitude that part of my job is to figure out how we can make things work better around here it adds another challenge to the job which makes the work more fun and more enjoyable. It all points in the same direction it seems to me. These methods do feed into making jobs more interesting and morale going up and the job being better.

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  • Photo from the top of Borobudur

    I have been adding some photos to Curious Cat Photos including this one from Borobudur in Indonesia.

    Also see photos of Mount Rainier National Park in Washington state and others from the USA.

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  • Toyota Mirai – Hydrogen Fuel Cell Electric Car

    I am curious, even skeptical, about the potential for hydrogen fuel cell versus battery passenger cars. I do respect Toyota and so am wondering if they do indeed see something that most others are missing.

    ...

    I do think hydrogen fuel cells may provide a better option for larger vehicles (maybe even shipping), but I have done next to no research on this so I may be wrong.

    It seem unlikely to me that hydrogen fuel cell passenger cars are going to make it but I would be happy to be wrong. Perhaps the advantages will overcome what seem to me to be challenges that are going to prevent them from being successful. I am confused about how committed to this strategy Toyota is (which makes me question my belief that hydrogen fuel cell passenger cars are not going to be successful).

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  • The Early History Of Quality Management Online

    I started looking at quality management resources online in 1995 (maybe 1994). At the time I was on the board of the Public Sector Network – what would become the American Society of Quality (ASQ) government division. When we started working with ASQ it took something like 2 months from the time I wrote an article until people received it. Now in 1995, the internet (outside of universities) was in its infancy. I was writing a column on the resources online for quality management – these consisted of bulletin boards (that you used your modem to call directly) and “gopher” and “ftp” sites and email lists a very few web sites... Well things changed frequently back then and by the time my article would be published phone numbers wouldn’t work, addresses would be out of date, etc..

    So I figured I should post my article online so people could just go there and see the updated phone numbers, addresses, etc.. That wasn’t so easy to do back then. But several of us at a W. Edwards Deming Institute conference decided to create a Deming Electronic Network (DEN)...

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  • Psychology Often Drives Decisions Rather Than Rational Thought

    I think that the primary thing to remember is that often people's actions and decisions are guided by psychology rather than thoughtful deliberation and choosing the most sensible option (given that person's desires).  What this means is you can't expect rational decision making to guide others decisions and actions.  You are often better understanding common psychology and how that impacts decision making.

      ...

    There are 2 reasons this is important: first you are likely making decisions this way and can improve your decision making by understanding how you are making decisions.  And second if you are trying to influence others understanding how they make decisions is important.

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