Posts selected fromManagement Blog - Engineering Blog - Investing Blog and other blogs - Traffic Congestion and a Non-Solution
For decades traffic congestion has been a problem in American cities and one that has continued to get worse. The typical proposed solution is to increase the number of roads. The theory behind this solution is not normally stated but, I believe, it amounts to: “if we build more roads then the system will have more capacity which has to decrease congestion.” Unfortunately this theory fails to take into account the past data on the increasing capacity of roads “solution.”
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Ackoff’s solution does require actually changing the system. That is not easy to accomplish. However, if the desire is to reduce congestion the solution is not likely to be to just keep doing what we have been doing (given that it isn’t working). Building more and more capacity doesn’t seem to achieve the desired results. continue reading: Traffic Congestion and a Non-Solution - Targets Distorting the System
 I still remember Dr. Brian Joiner speaking about process improvement and the role of data well over a decade ago. He spoke of 3 ways to improve the figures: distort the data, distort the system and improve the system. Improving the system is the most difficult. continue reading: Targets Distorting the System - Could Toyota Fix GM
Yes, Toyota could fix GM. Even the right leaders and managers, within GM, could fix GM but it is a huge long term job and it would be harder to do it internally because you will have to do it while competing with Toyota. Also they have some difficult issues to deal with since their previous managers did not tihnk of the long term (20-50 years out from the decisions they were making in the 70s though 90s).
I wouldn’t buy GM if I were Toyota, though. Why bother. Just grow Toyota, it is working very well so far. It makes sense to buy if you need to grow quickly to gain critical mass, or you will lose the opportunity to grow early in a fast moving market. High tech companies (like Cisco and Intel) often do well buying other companies – but just as often high tech companies make more mistakes buying than is justified by the successes. continue reading: Could Toyota Fix GM - Managing Fear
A good article on this topic is, Managing Fear by Gerald Suarez (who I worked with for several years). There are also 3 videos on this topic by Dr. Suarez, available from Management Wisdom, the producers of the Deming Library videos. I must admit I didn’t really understand the effects of fear and anxiety on performance until hearing Dr. Suarez speak on the topic many years ago. continue reading: Managing Fear - Fast Company Interview: Jeff Immelt
My guess would be that what lead to this quote is not a lack of understanding that managers need the same qualities today they needed 10 years ago but the compulsion to feed the media frenzy for some incredible new insight. It just isn’t sexy to say “we need the same leadership qualities we needed in the past.” Deming stressed the importance of these “new” qualities he states more than 50 years ago and I think most decent managers have know you need to “know why we’re doing them”
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Customer focus and innovation would also be at the top of the list of important issues and were 10 years ago and will be 20 years from now. What is important for management does not change much.
occasionally innovation is so dramatic it drastically changes the practice of management, two examples:
1) the use of information technology
2) the whole quality movement [Deming’s ideas, SPC, Toyota/Lean, Six Sigma… continue reading: Fast Company Interview: Jeff Immelt - Management is Prediction
I believe Deming’s thoughts about prediction are most effectively put into action using the PDSA cycle. Specifically, you must predict the results in the planning phase (prior to piloting improvements). I find that this is rarely done. I don’t think the form of that prediction is critical (narrative with loose numerical guesses, precise numerical prediction…). The critical issue is making the prediction, then comparing the results to that prediction and then figuring out how your original understanding can be improved based on the new data.
Learning will not only be about the specific case being examined, but also, over time, learning about your tendencies in prediction. continue reading: Management is Prediction - Deming’s Ideas at Markey’s Audio Visual
Mark Miller, General Manager, Markey’s Audio Visual spoke on Markey’s experience adopting Deming’s ideas.
- Markey’s needs to anticipate the changing needs of customers and anticipate those needs
- Unknown and unknowable – not really unknown just un-measurable (again taught to all employees)
- Gemba – where the real work gets done (the customer interaction – he stressed time and again that the key to their success was Markey’s employees interaction with customers – Markey’s aims to provide the best customer experience the customer has with any company)
- Break down barriers between departments – Markeys doesn’t charge internally. Indianapolis looses money – they own the high end equipment used by the other offices.
- Intrinsic motivation v. Extrinsic motivation – he has the chart from page 122 of New Economics in Deming’s handwriting on his wall.
continue reading: Deming’s Ideas at Markey’s Audio Visual - Jeff Bezos on Lean Thinking (2005)
I read a book recently about Toyota’s lean production methodology, which is very interesting
continue reading: Jeff Bezos on Lean Thinking (2005) - W. Edwards Deming’s Seven Deadly Diseases
Seven Deadly Diseases
- Lack of constancy of purpose
- Emphasis on short term profits (Overreaction to short term variation is harmful to long term success. With such focus on relatively unimportant short term results focus on constancy of purpose is next to impossible.)
- Evaluation of performance, merit rating or annual review (see: Performance Without Appraisal: What to do Instead of Performance Appraisals by Peter Scholtes).
- Mobility of top management (too much turnover causes numerous problems)
- Managing by use of visible figures, with little of no consideration of figures that are unknown or unknowable.
continue reading: W. Edwards Deming’s Seven Deadly Diseases - Design of Experiments in Advertising (2005)
It is great to see the application of Designed Experiments increasing. I am reminded of an article by my father, William G. Hunter, from 1975: 101 Ways to Design an Experiment, or Some Ideas About Teaching Design of Experiments. Examples of the topics of the designed experiments his students performed:
- taste of stewed chicken
- toys child chose to sleep with
- quality of ground malt for brewing beer
- distance football was kicked
- absorption characteristics of activated carbon used with municipal waste water
continue reading: Design of Experiments in Advertising (2005) - Customer Service is Important
My experience did not give me the impression they were focused much on what was important to me as a customers. The service I received seemed to be what I would expect from a company very focused on the idea that the objective of the company is to increase profits at the expense of everyone else. Two models of organization provide a very different customer experience. One that sees customers as fools to be fleeced seems common among USA arilines, health care providers, cable companies, large banks, car dealers and phone companies. The idea that organizations exists to provide customers value and the company takes a profit for providing that value sadly seem rare in the USA (though some organizations behave this way: Trader Joe's, many credit unions, many small restaurants and Apple (though some may disagree with me placing them here). continue reading: Customer Service is Important - The Purpose of an Organization
W. Edwards Deming described the purpose of an organization in New Economics, on page 51, as:
The aim proposed here for any organization is for everybody to gain – stockholders, employees, suppliers, customers, community, the environment – over the long term. continue reading: The Purpose of an Organization - Six Sigma Pitfalls
When people say “Six Sigma is great” or “Six Sigma is a waste” often they are talking about different things. But because in both instances “Six Sigma” is used people believe that the meaning must be the same in both cases. It often isn’t. While I find some Six Sigma efforts, books or consultants very useful many others (that also use the words “Six Sigma”) do not offer much of value.
What exactly is meant by “Six Sigma” varies quite a bit. And execution is critical to what makes one program succeed and another fail. continue reading: Six Sigma Pitfalls - Deming and Six Sigma
I agree aspects of Six Sigma are bad. I also think some aspects of Six Sigma are good. And I think the same things about TQM.
continue reading: Deming and Six Sigma - Measurement and Data Collection
I find it useful to ask what will be done with the results of data collection efforts (in order to confirm that the effort is a wise use of resources). If you don’t have an answer for how you will use the data, once you get it, then you probably shouldn’t waste resources collecting it (and I find there is frequently no plan for using the results).
I have found it helpful to ask: what will you do if the data we collect is 30? What will you do if it is 3? The answer does not need to be some formula, if 30 then x. But rather that the results would be used to help inform a decision process to make improvements (possibly the decision to focus resources in that area). I find, that asking that question often helps reach a better understanding of what data is actually needed, so you then collect better data. continue reading: Measurement and Data Collection
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