Blog posts on managing people

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

• Management Training Program

  So I said to the Toyota executive, “You’ve only got two or three suppliers per category, and you never take bids. How do you know you aren’t being ripped off?” So this guy, who was around 60, gives me an incredibly frosty look and says, “Because I know everything.” Everything? “That’s my job,” he says.

  Reading “Because I know everything” brings to mind an arrogant blowhard to many in America (I think). Probably because most who would say that, are arrogant blowhards. But when someone has worked (a Toyota executive or a baker) for 40+ years in the same area those words can have quite a different meaning than a 31 year old MBA working in his third industry. Managing with constancy of purpose and long term thinking can make a big difference.

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• Superior Customer Experiences Start with Respect for Employees

  Oakley found that there is a direct link between employee satisfaction and customer satisfaction, and between customer satisfaction and improved financial performance. Employee satisfaction is a key antecedent to employee engagement. He also found that organizations with engaged employees have customers who use their products more, and increased customer usage leads to higher levels of customer satisfaction.

  This is not a zero-sum game. Good managers grow the pie so all the stakeholders can get more benefit (customers, investors, employees…).

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• Performance Appraisal Problems

  There are no easy answers, but what it should be about is managing the system to produce the best results. My best advice is to read chapter 9 of The Leader’s Handbook and read the rest of the Leader’s Handbook and other great management improvement books. And manage using the ideas of Deming, Ackoff, Scholtes, McGregor, Ohno… 

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• People: Team Members or Costs

  Both Toyota and GM seek to use technology to improve but Toyota sees the technology as useful to help people to be more efficient, eliminate menial repetitive tasks, eliminate tasks that cause injury… and it seems to me GM saw technology as a way to eliminate people. The action showed a company that viewed people as a cost to be eliminated. GM did not act as though people were their “most important assets” as we so often hear, but see so little evidence of in the action of companies.

  
  Toyota does try to reduce overall costs (including labor costs) by continually improving and making cars more and more efficiently (so they can produce cars using fewer hours of labor in the future than they need today). Trying to become more efficient by engaging everyone in the effort is a part of the system of management at Toyota. The current Toyota employees are an important part of the system and are not viewed as a cost to eliminate. 

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• Problems with Bonuses

  Commission pay and bonus often set up a conflict between what is in the interest of the company and the employee. They lead to bunching of orders around quarterly quotas, deadlines and competitions. They lead salespeople to think their job is to sell whatever pays them the most not to assist the customer.

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• Respect for People

  “Ohno was absolutely ruthless, employees and suppliers lived in fear of him.” I would say that while Taiichi Ohno was truly remarkable that doesn’t mean he did everything right.

  ...

  The difference between respect and disrespect is not avoiding avoiding criticism. In fact often if you respect someone you can be much more direct and critical than you can with someone you treat as though they don’t have the ability to listen to hard truths and improve. I think we often have so little respect for people we just avoid dealing with anything touchy because we don’t want to risk they won’t be able to react to the issues raised and will instead just react as if they have been personally attacked.

  It may also be that it is easier to train managers to behave in this way than to effectively deal with though issues. But that is not training them to respect people, it is your organization accepting you don’t respect your people (managers and others) so just train people how to behave in a way that avoids difficult areas.

   

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• Management: Geeks and Deming

  Several of Deming’s 14 obligation of management and 7 deadly diseases are noted in this quote, including: “Remove barriers that rob people of joy in their work” and the disease – “Emphasis on short term profits.” Deming was a physicist so that may explain the similarity of this ideas to geek management culture.

  • “Geeks seek knowledge for it’s own sake” – Deming’s point 13 “Institute a vigorous program of education and self-improvement.” Deming encouraged organizations supporting education of employees – even when unrelated to work in any direct way.
  • “Geeks like to experiment” – many of Deming’s ideas focus on this point, most obviously is the emphasis on PDSA
  • “Geeks openly debate the merits of technical ideas”

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• Problems Caused by Performance Appraisal

  People are increasingly challenging the notion that we just have to live with performance appraisal systems. As usually, I will make my suggestion that chapter 9 of the Leader’s Handbook offers great material on performing without appraisal (and the rest of the book is great too).

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• Forget Targets

  While targets and goals can distract from improvement some guidance is useful. Systems thinking is important when using targets. As is an understanding of psychology (given the tendency to manage to what is measured the system can often be distorted to achieve a target). See more in: dangers of forgetting proxy nature of data.

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• Arbitrary Rules Don't Work

  You can’t just expect people to act in a way that seems arbitrary.

  ...

  It is not ok to expect people to think the way you want them to. You have to understand how people will react and create solutions based on that.

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• Employee Ownership

  I have always liked the idea of employee ownership. To me this can be a great help in creating a system where employees, owners, customers, suppliers work together. Alone an Employee Stock Ownership Plan (ESOP) does little. But as part of a system of management it is something I think can be beneficial.

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• 10x Productivity Difference in Software Development

  I think these orders of magnitude are not present between people in many jobs. And I think people’s ability to correctly access who are orders of magnitude better is often faulty. But my experience leads me to believe the difference between exceptional software developers and average (not even below average) is very high.

  In many fields interruptions are costly (and multi-taking is wasteful. In software development those interruptions are often much more costly than in other fields.

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• CEO Flight Attendant

  This getting out and seeing work in action is exposed a great deal, including a lean management concept, Genchi Genbutsu – to go to see the problem in situ (not just reading a report about it).

  The success of many management practices is more a matter of how the practice is done than if it is done. Also the success depends on the rest of the management system. Practices cannot just be copied. But you can learn from what others find useful and figure out how that idea would work within your organization.

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• Ex-Toyota Manager Consulting with Porsche in 1994

  While respect for people is an important part of the Toyota Production System, the practice of former Toyota managers were often the "tough love" variety. Today, many people are often too timid, in my opinion, to call out things that need to be improved for fear of making someone uncomfortable. Where that balance properly lies though is based on the culture of the organization (and what needs to be done - occasionally there is a need to "shake people up" in order to make change take place more effectively).

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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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