Blog posts on critical thinkingPosts selected fromManagement Blog - Engineering Blog - Investing Blog and other blogs - The Exciting Life of Industrial Statisticians
All of this provides great new opportunities for industrial statisticians to serve as statistical leaders-a term popularized by the late and great Ed Deming (see Hahn and Hoerl, 1998). Statistical leaders engage principally in leveraging statistical concepts and thinking (see Hoerl, Hooper, Jacobs and Lucas , 1993), and focus their activities on mentoring and supporting the most business-vital and technically challenging problems dealing with getting the right data, and converting such data into actionable information.
continue reading: The Exciting Life of Industrial Statisticians - New Rules for Management? No!
“New” rule: “The customer is king.”
Yes. GE would have said the same thing. Shareholders rule as the old rule? Yeah they still seem to. Few companies today, 10 years ago, 50 years ago… understand that there are many stakeholders – all of which the organization should benefit: customers, stock holders, suppliers, workers, the community… I see no evidence there has been any shift in thinking.
“New” rule: “Look out, not in.”
What kind of rule is that? It is pretty obvious you need to do both. I find it incredible the amount of time that is taken trying to show “new” ideas that amount to absolutely nothing. See comments on: Fast Company Interview: Jeff Immelt. continue reading: New Rules for Management? No! - Usability Failures
I guess if you operationally define “nothing wrong” as a failure to work as the manufacturer intended that would be true. But is that what really matters? What is the number of defects that should be counted?
The design of the phone is broken if 63% of the returns work as intended and customers still think they are broken. You might argue that the instructions are bad, but really shouldn’t people just be able to use the phone if it is designed well? continue reading: Usability Failures - Motivation is Most Often Misguided
- Competition
Most aspects of Deming’s thinking seemed natural to me from the start. Some ideas have taken longer (it took me awhile to be won over to the harm caused by performance appraisals, for example). Competition is another area that I still struggle with. I have been moved greatly by my experience and the thoughts of people like Alfie Kohn (No Contest: The Case Against Competition).
But I still hold more promise for some aspects of competition and I hold less concern than some about other aspects of competition. Still I agree that there is a good deal to learn about the dangers of competition which often creates havoc within a system. continue reading: Competition - Distorting the System or the Data is Easier Than Improving the System
3 ways to improve the figures: distort the data, distort the system and improve the system. Improving the system is the most difficult.
When people mistake the data proxy for the thing to improve they focus on improvement of how the data looks not of the system. That is the wrong strategy. The correct strategy is to focus on improving the system and as a way of verifying results you then look at measures. But you must always remember those measures are not the end they are an attempt to measure the end you are trying to achieve. continue reading: Distorting the System or the Data is Easier Than Improving the System - Ackoff, Idealized Design and Bell Labs
“Doesn’t it strike you as odd,” he said, “that the three most important contributions this laboratory has ever made to telephonic communications were made before any of you were born? What have you been doing?” he asked. “I’ll tell you,” he said. “You have been improving the parts of the system taken separately, but you have not significantly improved the system as a whole. The deficiency,” he said, “is not yours but mine. We’ve had the wrong research-and-development strategy. We’ve been focusing on improving parts of the system rather than focusing on the system as a whole. As a result, we have been improving the parts, but not the whole.
We have got to restart by focusing on designing the whole and then designing parts that fit it rather than vice versa.
continue reading: Ackoff, Idealized Design and Bell Labs - Gladwell (and Drucker) on Pensions
The most influential management theorist of the twentieth century was Peter Drucker, who, in 1950, wrote an extraordinarily prescient article for Harper’s entitled “The Mirage of Pensions.” It ought to be reprinted for every steelworker, airline mechanic, and autoworker who is worried about his retirement. Drucker simply couldn’t see how the pension plans on the table at companies like G.M. could ever work.
Pension plans did work well for a short period of time. But recently they (along with the attached retiree health care) are one of the big problems facing large old companies: like GM. Gladwell talks about the dependency ratio for an economy and the dependency ratio of companies. Worsening dependency ratios can cause pension plans to kill companies (if they are not funded when the obligation is incurred) – as the company is forced to pay for more and more retirees with fewer and fewer workers. continue reading: Gladwell (and Drucker) on Pensions - Doing the Wrong Things Righter
Most of our current problems are, he [Russell Ackoff] says, the result of policymakers and managers busting a gut to do the wrong thing right.
I agree with the very big problem of ignoring the overall system and seeking to improve what really should be completely rethought and changed. However, I am a bit skeptical of the idea of it being better to do the right thing poorly than it is to do the wrong thing well.
I realize "It is far better to do the right thing wrong than to do the wrong thing right." as Russell Ackoff has said, is a catchy quote. But certainly the truth is that it depends on the system and how wrong or right a thing is and the action is. Sometimes it is far better to do the wrong thing fairly well (to increase the overall benefit to the system) than to do the right thing poorly (and create huge problems in the rest of the system). So sure pay attention to the concept of thinking about whether the best course of action is to completely change what you are doing instead of improving how you are doing it. But don't pretend it is really is better to do the right things wrong - it depends. Sometimes sure that is true, other times it isn't. continue reading: Doing the Wrong Things Righter - Righter Performance Appraisal
Just because it would be nice for performance appraisal to work doesn’t mean it does work. As Deming said some numbers are unknown and unknowable and the wish that it is possible to quantify the contributions of people doesn’t mean you can. People cling to the idea that performance appraisal is the only tool we have to manage performance so we must use it. Even if most people realize it is just a game that accomplishes little, if anything positive, and causes great frustration and animosity they persist. Hopefully performance appraisal will be seen as “artifact of the past” sometime soon. continue reading: Righter Performance Appraisal - Creating and Sustaining Great Management Systems
It is hard enough to create and sustain great management systems without adding more challenges to achieving success. When the management system results in having credit for each success fought over (to allocate credit to whoever convinces others they deserve the credit) it is much harder.
This is one of the many ways Performance appraisals schemes (where people have to claim responsibility for successes in order to get more cash) create problems. continue reading: Creating and Sustaining Great Management Systems - Ackoff’s F-laws: Common Sins of Management
Managers who don’t know how to measure what they want settle for wanting what they can measure.
continue reading: Ackoff’s F-laws: Common Sins of Management - Sub-optimize a Part to Optimize the Whole
...choosing to sub optimize a part to optimize the whole. One of management’s roles is to determine when to trade a loss to one part of the system for the sake of the overall system. One of the big losses for software development is interruptions which distract developers. continue reading: Sub-optimize a Part to Optimize the Whole - European Blackout: Human Error-Not
The focus seems to be that we didn’t do anything wrong, just some “human” made an error, which seems to be implied is out of their control. Why would the organization not be responsible for the people and the system working together? Management needs to create systems that works. That system includes people and equipment and process management and suppliers
…
If management tries to claim a failure was due to "human error" they have to provide me a great deal more evidence on why the system was designed to allow that error (given that they say the error is "human" implies that they believe the system should have been able to cope with the situation). Requesting that evidence is the first thing reporters should ask any time they are given such excuses. At which time I imagine the response options are:
- no comment
- we had considered this situation and looked at the likelihood of such an event, the cost of protecting against it (mistake proofing) and the cost of failure meant and decided that it wasn't worth the cost of preventing such failures
- we didn't think about it
- we think it is best not to design systems to be robust and mistake proof but rather rely on people to never make any mistakes
What they will likely say is we have these 3 procedures in place to prevent that error.
Are they every followed? You have something written on paper, big deal? What actually happens?
Yes they are always followed by everybody, this one time was the only time ever that it was not followed. Why?
This person made a mistake.
Why did the system allow that mistake to be made?
What? You can't expect us to design systems that prevent mistakes from being made.
Yes I can. That is much more sensible than expecting people never to make a mistake. continue reading: European Blackout: Human Error-Not - The Illusion of Understanding
It is important to understand the systemic weaknesses in how we think in order to improve our thought process. We must question (more often than we believe we need to) especially when looking to improve on how things are done.
If we question our beliefs and attempt to provide evidence supporting them we will find it difficult to do for many things that we believe. That should give us pause. We should realize the risk of relying on beliefs without evidence, and when warrented look into getting evidence of what is actually happening. continue reading: The Illusion of Understanding
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