Sunday, December 21, 2014

I Don't Take "Better Management" for Granted

My response to a post on Management Innovation is at the Top of the Innovation Stack and the authors reply to my first comment:

JD Meier: "I think we are so used to 'better management' now that we take it for granted."

You are much luckier than I (both as an employee and customer). I find very few companies show evidence of practicing what Deming, Drucker, Ackoff etc. talked about many decades ago. Better management is still a distant hope for most organizations in my opinion.

I do think Hamel talks about lots of good stuff. I admit my study of his is not extensive, but from what I remember he does tend to (as do nearly all these people trying to sell their ideas) make more of what he is saying than is merited.

It reminds me of college when about 50% of my professors in the first lecture had some version of: In [this class] we are studying the true core of knowledge, everything else is just a different take on what we will study here. If it was physics then chemistry, biology... are really sub-disciplines of physics. If it was philosophy everything else was a sub-discipline of philosophy. I thought it was pretty funny. And that passion likely made them great professors, even if I think they lost perspective on reality.

I think even many fairly good management thinkers get hung up on the wonderfulness of their thoughts and how critical their details are. I do still I do like Hamel but I think he is too caught up with his ideas and thinking what he has been looking at is more important than it really is.

My first comment:

I agree with what I think is the premise - that better management is critical for the ability for an organization to successfully innovate. And that bad management can kill otherwise excellent innovation in the other domains you list.

I think calling it management innovation however is misleading. It is true management at very valuable companies (and less valuable ones) needs a great deal of improvement. But it is mainly adopting good management practices people like Deming, Ackoff and Drucker talked about many decades ago.

Related: The Need to Improve Management While Building Organizations Fit For Human Beings - Quality and Innovation - New? Different? How About Better?

Tuesday, December 16, 2014

Niche Markets

One of the things I find amazing is how focused niche markets are. I noticed this as a kid collecting baseball cards and then paying attention to all the very focused niche markets I saw. When people find it surprising that people actual focus on that I don't really find it surprising but I do still find it interesting.

Here is a good example of what I mean, a business focused on manufacturing bottle caps specifically for use in craft and jewelry projects. That is not a market I think most people think of and say wow if only I could build a business in that market I would be set.

But by focusing on customers and building your business to give customers what they want you can build a good business. That is how the Bottle Cap Company built itself. It started out selling on bottle cap products at local farmer's markets and then ended up with an extra supply and sold that on eBay. And based on that response they saw a larger global market and expanded. And now they ship products and supplies daily all over the world from their warehouse located in Nampa, Idaho.

The success of companies like Google and Apple and Tesla are interesting. But far more success is gained in small companies providing needs to niche markets. I wrote about recent lean startup weekend in Johor Bahru, Malaysia recently along the lines of providing products and services to meet customers needs and not needing to try and become the next Twitter. Sure making billions sounds nice but that is extremely unlikely. However building a successful small business is possible by managing the business well and applying good customer focus principles.

Related: What Works for One Business May Not Work For Others - Pilot on a Small Scale First, Good Advice We Often Ignore - The Customer Knows Best?

Sunday, December 14, 2014

It isn't Fair to be Judged for Performance Outside Your Control

My response to Simon Guilfoyle post
It’s also necessary to acknowledge that multiple variables affect crime rates; factors such as economic cycles, substance abuse, the weather, societal influences, changes in legislation, and so on. None of these are directly within the gift of the police to influence. Also, what about where the police cause an increase in reported crime by having the temerity to find someone carrying a weapon? Surely proactive problem-solving should not be discouraged on the basis that finding hitherto unreported criminal offences is incongruous with an over-simplified crime reduction narrative...
I would say many of the examples are outcome measures of the system - which is a better measure than is often used.

However, they are often beyond the control of individuals and even police departments overall (many other factors play a part - economic development, social services system, education system...).

Likely more directly relevant the measurement error is often so high that the figures have more to do with measurement than the actual outcome. And when the figures are being used to blame then it dramatically increases the likelihood the figures will be a poor representation of outcomes.

I would rather see more focus on outcome measures. We should also reduce incentives to misreport data (often blame related).

I think the issues you raise about the system being larger than the police can tackle alone should be a reason to INCREASE the view of the SYSTEM. The important system is LARGER than the police department. When we have institutional walls that break up the system we need to find ways to knock down those walls so the system can work together. Granted this seems nearly impossible given how much difficulty we have even just breaking down barriers inside tiny pieces of our organizations.

Nevertheless that is where the focus should be. We shouldn't decide the outcome measures are not fair given where we put organizational barriers. We should decide that we need to realize when we cut funding for x it drives bad results in section a. And when we allow y to retain fitfully outdated management practices that doesn't just impact their ability to succeed it likely creates lots of other problems all over the place.

Related: Be Careful What You Measure - Millennium Development Goals

Sunday, December 07, 2014

Sustaining Management Improvement Through Personnel Changes

My reply to a comment on Reddit about my interview: Leadership While Viewing the Organization as a System.

So if a new manager is able to mess it up, the system was necessarily weak? Not sure I agree.

Looking at the context the interviewer asked about a new CIO coming in a gutting the management system. I said if they have a strong management system that can't happen. Executives can't just have whims (usually driven by a desire to "make their mark") that throw out the principles used to manage the company if there is actually a strong management system.

Most organizations just float with whatever fads are going on, so in most they can flip flop as new executives come into place.

On the question of new managers making mistakes. Yes, I agree they can. Once again good management systems make a significant effort to bring new managers up to speed. Those management systems reduce the likelihood of failures created by new managers making mistakes. Again, most organizations do a poor job of brining new managers up to speed: Toyota does a good job, the USA military does also, Costco does a good job, I think P&G does (but my information could be outdated). Many others do this well, but the majority of companies do this extremely poorly. That is a serious failure of a management system and I would put more of the blame for those failures on the poor management system, that the managers making mistakes when they were put in a position they shouldn't have been (being made responsible without proper preparation).

Related: Poor Results Should be Addressed by Improving the System Not Blaming Individuals - Management Training Program (2005 Curious Cat post) - Curious Cat Management Improvement Dictionary

Monday, December 01, 2014

Data Must be Understood to Intelligently Use Evidence Based Thinking

All metrics are wrong, but some are useful
Metrics might tell you something about the world in a quantified way, but for the how and why we need models and theories … metrics are generated must be open and transparent to make gaming of the system more difficult, and to expose the biases that are inherent in humanly created data
True, understanding the proxy nature of data (and how well or questionably the proxy fits) is important.

Data can't lie but we often make it easy for others to mislead us when we don't understand (or question) what the data really means (what operational definitions were used in the collection, etc.).

Related: Operational Definitions and Data Collection - Actionable Metrics