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Posts selected fromManagement Blog - Engineering Blog - Investing Blog and other blogs

• Peter Scholtes on Teams and Viewing the Organization as a System

  Peter includes a description of the creation of the “organization chart” (which Peter calls “train wreck management”) that we are all familiar with today; it was created in the Whistler report on a Western Railroad accident in 1841.

  Almost a direct quote from the Whistler report: “so when something goes wrong we know who was derelict in his duty.” The premise behind the traditional organizational chart is that systems are ok (if we indeed recognize that there are such things as systems) things are ok if everyone would do his or her job. The cause of problems is dereliction of duty.

  ...

  This is an absolutely great presentation: I highly recommend it (as I highly recommend Peter’s book: The Leader’s Handbook).

  Without understanding a systems view of an organization you can’t understand whats at the heart of the quality movement and therefore everything else you do, management interventions, ways of relating to people, will reflect more likely the old philosophy rather than the new one.

  
  Points like this are very true but difficult to understand until you come to view organizations as systems.

  continue reading: Peter Scholtes on Teams and Viewing the Organization as a System
• 10 Stocks for 10 Years (2018 version)

  The 10 stocks I selected for this 2nd version are (closing price on 22 April 2005 – % of portofilo invested):

  • Tencent (TCEHY) – $43 and 15% (using the USA ADR). A phenomenal company with incredible global prospects for the long term. As the stock price has been hampered by concerns about China it has great potential for appreciation from the current price.
  • Alibaba (BABA) – $175 and 15% (using USA ADR). Another phenomenal company with incredible global prospects that has performed poorly this year due to China concerns.
  • Alphabet (GOOGL) – $1,254 and 11% (in the original 2005 portfolio the price was $216 and it started at 12% of the portfolio. The prospects are great long term, the stock price reflects that so it isn’t cheap but over the long term I expect it to do very well).
  • Apple (AAPL) – $225 and 11% (I added Apple to the original 10 for 10 portfolio in 2010. The biggest mistake in the original portfolio was leaving off Apple, I considered it but chose not to include it. It has been my largest stock holding for years. It has been very cheap even just a few years ago, though today I think the price is much more reasonable so it isn’t the great bargin it has been. Still the long term prospects are great.)
  • Abbvie (ABBV) – $97 and 10% (I added Abbive to the original portfolio in 2014. I would select a couple other healthcare stocks in a real invested portfolio for balance but Abbvie is the company I am most comfortable with so I include it here.)
  • Toyota (TM) $125 and 9%

  ...

  continue reading: 10 Stocks for 10 Years (2018 version)
• Iterative Customer Focus

  Like many of Deming’s ideas the idea of iterative customer focus can seem too simple to be very powerful. But in fact that idea is extremely powerful. Those familiar with agile software development can see the idea of delivering working software quickly and iterating based on actual customer use illustrated in Dr. Deming’s “new way” iterative cycle shown in his paper published in 1952.

  The importance of learning about non-users is something that still today is often overlooked...

  I have written about importance of customer focus to Deming’s ideas in several previous blog posts, including: Customer Focus with a Deming Perspective, User Gemba and the most important customer focus is on the end users.

  continue reading: Iterative Customer Focus
• Wonderful Jungle Hike at Mount Santubong, Borneo, Malaysia

  My hike on Mount Santubong was an amazing experience. The hike was quite challenging; very step climbing for a long time.

  The trail climbed like this for a long time. The ropes could help you climb (especially necessary if there had been rain recently as it is not only steep but slippery when went). Quite frequently rope ladders were necessary to aid the climb.

  The Rhinoceros Hornbills I saw on the hike were amazing.

   

  continue reading: Wonderful Jungle Hike at Mount Santubong, Borneo, Malaysia
• Improvements to Credit Collection Requirements Have Had a Positive Impact

  Abuse of the credit system by 3rd party collection agencies (and credit reporting agencies) in the USA has been a long term problem.

  An attempt to partially address some of the abuses was a change in the required reporting practices that impacted collections accounts specifically, known as the National Consumer Assistance Plan (NCAP), which rolled into effect during the second half of 2017.

  ...

  This was a small good step in protecting consumers from the bad behavior of credit reporting companies and their customers. But much more must be done to protect us from having our financial lives negatively impacted by bad practices of the credit reporting companies.

  continue reading: Improvements to Credit Collection Requirements Have Had a Positive Impact
• The Best Form of Fire Fighting is None at All

  The best form of problem solving is to avoid problems altogether.

  At the point you have a “fire” in your organizaiton you have to fight it. But it is better to create systems that avoid fires taking hold in the first place.*

  This is a simple idea. Still many organizations would perform better if they took this simple idea to heart. Many organizations suffer from problems, not that they should solve better, but problems they should have avoided altogether.

  continue reading: The Best Form of Fire Fighting is None at All
• What Loss Will a Business Suffer Due to a Dissatisfied Customer?

  You can’t know how much a dissatisfied customer will cost your business in the long run. You can make statistical judgements about how costly dissatisfied customers are to a business but those are loaded with many guesses. They can give a general indication of the magnitude of the costs but they are largely guesses, not something you can measure.

  Sometimes a business largely gets away poor quality for a long time. The customer doesn’t change behavior, doesn’t complain to others and doesn’t punish the company in the long term. But you never know when one small failure will cause the luck to run out and turn a customer against the business and costing it dearly.

  continue reading: What Loss Will a Business Suffer Due to a Dissatisfied Customer?
• Surviving Modern Conveniences

  Today my car wouldn't start. I guessed the battery died.
  
  I try to use Lyft. Their app says it is a bad connection and so it won't work (using iPhone on Sprint in Charlotte, NC - the 17th largest city in the USA). Sad but ok, whatever, deal with it. Ok try my iPad mini with ATT. Lyft connects and doesn't let me use it requires putting in a phone number before it will do anything so that I can get pin and give it to them. Ok, give them the number. Nothing ever comes from them. 
  
  Ok try Uber on iPhone. Uber asked for permission to spy all the time (not just when you are using Uber). Decline that intrusion. Now it can't find my current location. So I type it in. It finds it. Uber says it isn't available where I am and only offers their "luxury" options.

  ...

  The modern convinces really did help in many ways (I am still hoping the trickle charger will help, though as I write this it is still questionable). The battery is about 10 months old. But while it is great to have cell phones and apps to help us when we are stuck it is very annoying to have such bad connectivity in the 19th largest city in the USA and such lame usability failure in the Uber and Lyft apps. And it is frustrating to have to deal with your own lameness that likely caused the battery to die (I left the lights on in the car - the garage had lights on so I didn't register the car lights were not going off...) and putting in the wrong address...

  continue reading: Surviving Modern Conveniences
• Bad Ux by Google and the Value of RSS Feeds to Avoid Bad UX Practices

  Google has been really bad at UX (user experience) for a long time. I use RSS feeds to manage the content I want to enjoyand it works great (for blogs and You Tube and podcasts). Thankfully Google hasn't broken this yet (though given their track record in the last 10 years it would not surprise me if they do at some point).
  
  Of course it will be easy for creators to generate their own RSS feed for their videos if Google does break it. I created several feeds on my personal site for (selected blog posts by John Hunter and a time travel feed for my blog posts*).

  continue reading: Bad Ux by Google and the Value of RSS Feeds to Avoid Bad UX Practices
• Factfulness – An Extremely Valuable Book

  Data is extremely valuable in helping us make decisions and evaluating the effectiveness of policy. However it is critical to be careful. It is very easy to focus on meeting targets that seem sensible – increasing the number of hospital beds – but that lead to less effective policy.

  ...

  The book relentlessly points out the great progress that has been made globally over the last 50 years and how that progress continues today and looks to be set to continue in the future. We have plenty of areas to work on improving but we should be aware of how much progress we have been making. As he points out frequently he has continually seen huge underestimation of the economic conditions in the world today. This book does a great job of presenting the real success we have achieved and the progress we can look forward to in the future.

  continue reading: Factfulness – An Extremely Valuable Book
• Understanding Variation Doesn't Mean Crushing Any Variety

  Dr. Deming understood the organization as a system and how understanding variation fit within that system. When variation within the system causes problems and reduces efficiency then reducing variation important. It is a mistake to attempt to take thinking that is part of a system and analyze it without understanding the context within which it has meaning.

  continue reading: Understanding Variation Doesn't Mean Crushing Any Variety
• Good Project Management Practices

  This post is in the style of my Good Process Improvement Practices and Practical Ways to Respect People posts.

  Good project management practices include

  • Deliver a working solution quickly; add value as you have time. Don’t aim to deliver a final product by the deadline and risk missing the deadline. Deliver a good solution early, adjust based on feedback and add more as you have time.
  • Prioritize – do fewer things, and do them well.
  • Limit work in process (WIP) – finish tasks, avoid the problems created by splitting attention across numerous tasks.
  • ...

  continue reading: Good Project Management Practices
• Stone Forest, Yunnan, China

  I enjoyed my visit to the Stone Forest (South China Karst) area.  It was a shallow sea some 270 million years ago (the Permian period) when the sandstone and limestone deposits were formed. The entire Shilin National Scenic Area covers an area of 400 square km.

  Related: Floating Down River in Yangshuo, China on a Bamboo Raft, Jianshui Wet Market in Yunnan, China and Grand Mosque of Shadian, Yunnan, China

   

  continue reading: Stone Forest, Yunnan, China
• The Management System is the Key

  I think too often people (in relation to management ideas) demand that things be made more simple than is possible to adequately understand the systems involved. This of course leads to problems. A huge value provided by people like Russell Ackoff is their ability to help explain what is needed in fairly simple terms. Still understanding how these ideas are being expressed in our management systems and how to apply the concepts to our management systems is still a challenge.

  ...

  I think one of the big differences between the best lean efforts and the others is the increased value placed on deeper understanding and thinking systemically.

  continue reading: The Management System is the Key
• The Quality of the Entire Customer Experience

  Product quality, in many ways, has been raised in the last few decades and this naturally results in raised expectations. This pattern was well known in the 1960s (and before). Kano’s theory of customer satisfactionexpressed how new features moved from being “delighters” for customers initially and eventually became minimum expectations (you gain no credit for delivering them but will upset customers if you fail).

  It is also true that raising the overall customer experience is more difficult than raising product quality (due to the nature of the systems that deliver the results in each case).

  I do think there is truth to the idea that customers have raised expectations for businesses to improve the entire experience. Customers are less willing to accept excuses about how the provider is not responsible for various aspects of the experience...

  continue reading: The Quality of the Entire Customer Experience