Managers’ Knowledge: What Remains Once You Have Forgotten Everything

To what extent should managers be able to do the work of their subordinates? And, if they are, how should they use this ability? This is not a topic I have seen addressed in the management literature, perhaps because there are no generic answers. The manager of a car repair shop is typically a mechanic who can do everything the technicians can, but the manager of an opera company usually can’t sing.

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Is there such a thing as managerial DNA? | LinkedIn

Scientific and technical terms are frequently used metaphorically in business, in ways that don’t always make sense. Companies, nowadays, are commonly described as having certain practices, “in their DNA,” and you hear discussions of “changing their DNA.”As is known to anyone who has taken High School biology or watched a recent cop show on TV,  the one thing you can’t change is your DNA. We each have our own version, formed at conception and replicated in every cell of our body.

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Dr. Deming: ‘Management Today Does Not Know What Its Job Is’ (Part 1) | IndustryWeek

[…]”Management today does not know what its job is. In other words, [managers] don’t understand their responsibilities. They don’t know the potential of their positions. And if they did, they don’t have the required knowledge or abilities. There’s no substitute for knowledge.”


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Making time for improvement

“How do you make time for improvements?” asked a manager on The Lean Edge. The anonymous questioner is self-described as experienced in Lean and currently CEO of a company in the outdoor sports industry, with employees who want time to climb, backpack, canoe, etc. This question brought forth an unusually brutal answer from usually mild-mannered Art Smalley, casting doubt on the questioner’s actual experience of Lean and telling him or her to exercise leadership.

I would not be so harsh. The situation in the CEO’s company is best described by this cartoon I found on Scott Simmerman’s site:

Getting out of this dysfunctional mode of operation is not obvious, and can be a challenge even for someone who has experienced Lean in a company that has been working on it for a few years.

While I have never seen it acknowledged in the literature, my own experience is that first-line managers — whether called supervisors, group leaders, or area coordinators — are the key agents for improvement activity. As part of management, they have the clout needed to get support from Maintenance, Engineering, and other support groups; from being on the first line, they are in direct contact with production operators and communicate with them daily. This puts them in a unique position to lead improvement projects, but the way their job is set up in many companies prevents them doing it.

In the Toyota system in assembly, the first-line managers are in charge of four to six teams of four to six operators each, which translates to a minimum of 16 operators and a maximum of 36, with the actual average being near the low end. When NUMMI was running, the figure was an average of one first-line manager for 17 operators. Contrast this with a situation I encountered in many manufacturing companies, where each first-line manager had 80 to 100 operators, and had no time for anything but expediting parts, keeping records, and disciplining rogue operators. The upper managers were proud of this situation, and described it as “Lean.” They didn’t think it was a good idea to have more first-line managers because they are “non-value added.”

I don’t presume to know whether this is the case in the questioner’s sporting goods company but, if it is, reinforcing first-line management is a good place to start, particularly if it can be done by internal transfers, for example by giving engineers the opportunity to try their hand at running production. It must also be clear that these new first-line managers, with fewer operators, are expected to spend 30% of their time on improvement.

Starting continuous improvement in an organization is a bootstrapping process. Pilot projects not only demonstrate value but free resources and develop skills that allow you to ramp up the activity. For this to happen, the selection of pilot projects is critical and here are some of the conditions they must meet:

  • They must be few in number. An organization that is starting out in Lean may have the capacity to undertake two projects, but not ten.
  • They must be within the area of responsibility of a single first-line manager, to avoid the complexity associated with involving multiple departments.
  • Each one must have tangible, measurable improvements at stake, at least in quality and productivity. Otherwise, they will not be “pilots” of anything.
  • They must be feasible with current skills of the work force.
  • They must be opportunities to develop new skills.
  • The target area must have a sufficient remaining economic life. If you plan to shut it down in six months, don’t bother improving it.
  • The first-line manager must perceive the project as an exciting opportunity.

Most “Lean initiatives” do not bother with such considerations.  No wonder they fail.

Drop the “Sensei” nonsense!

In the US, many use the Japanese word “Sensei” for the people who help companies implement Lean; in Japan, they use the English word “Consultant.” On both sides, words borrowed from the other’s language have snob appeal, and give the jobs a mystique it doesn’t need or deserve.

See What to Expect from Lean Manufacturing Consultants for  a Japanese perspective on this profession. As I also pointed out earlier, “sensei” (先生) is the Japanese word for school teacher. As a title, it is used through High School but not in Universities. You might use it to say that a person teaches at a university, but there is another word for “Professor” (Kyoju).

In Karate, there are six levels of instructors, from Deshi to Soke, and Sensei is the second lowest. The word is also attached to people’s names as a form of address, instead of “San,” either to make them feel respected for their expertise or sarcastically. It is nothing special.

In Lean, there is nothing a “Sensei” does that is different from what a good consultant would do. There is no need for new vocabulary. Consulting involves a business relationship that is different from employment, but the same kind of agreement also covers contractors as well as consultants.

What is the difference?  Most people don’t see any, and many contractors call themselves “consultants.” The key distinction is that a contractor works like a temporary employee, while consultants advise, train, and coach employees. The contractor’s output is more tangible, but the ability to produce it walks out with the contractor, whereas the consultant transfers know-how that remains after the end of the engagement.

You hire a contractor to write control software for your production equipment, because you don’t have engineers who can do it, and you don’t think you have a need for this skill on an on-going basis. If, however, you think it should be available in your organization, you may bring in a consultant to help your managers set strategies and policies on equipment control programs, select tools, and learn how to use them.

There are as many ways to work as a consultant as there are fields in which they are needed. Often, the know-how they transfer is procedural. They tell companies how to comply with regulations, pass audits, get ISO certified, or win the Shingo Prize.

Less often, it is about thinking through business strategy and finding the right moves in management and technology to be competitive. It is much more challenging, and there is no 12-step methodology for it. Lean consulting is in the latter category, because Lean implementation cannot be reduced to a procedure to be rolled out without thinking in every organization, whether it makes sausages or airplanes.

It is challenging, but it is what high-level consultants have been doing ever since Frederick Taylor invented the profession 125 years ago. It does not need a new name.

The Putin Production System

In an earlier post we saw a message from Stalin to a factory manager that showed his way of motivating employees. Now Youtube has the following video illustrating Vladimir Putin’s approach to manufacturing:

The video was first posted on Youtube on 2/17/2012, when Putin was Prime Minister and running for President in the election that took place on 3/4/2012. The event took place three years earlier, and was reported in the New York Times on June 4, 2009. It happened at the Baselcement factory, which makes alumina, in Pikalevo, 150 miles East of Saint-Petersburg. The video was obviously not taken with a hidden camera; it was a deliberately staged event.

Putin comes to this cement factory, berates the managers for being unprepared, and “running around like cockroaches when I said I was coming.” He tells the owners that they are “unprofessional and greedy,” and then that this factory, which we didn’t know was closed, would be restarted “one way or another,” and without the owners if they didn’t cooperate.

One of the owners in the room is Oleg Deripaska, a rich businessman and political ally of Putin. Putin has an agreement in hand, that is apparently missing Deripaska’s signature, which he demands. The last touch, after Deripaska signs is Putin demanding his pen back, which seems intended as a counterpoint to the White House signing ceremonies where the US President gives away pens.

Seeing the confidence with which Putin passed judgement on manufacturing issues, I assumed it was based on his own extensive experience. The wikipedia article on him, however, only mentions 16 years in the KGB prior to entering politics.

BeripaskaIn the video, we see what appears to be a cheap nerd watch on billionaire Deripaska’s wrist. The same watch is prominent on his home page, and has to be there on purpose. If Deripaska has a Rolex, he keeps it out of the public eye.

A Company Without Job Titles Will Still Have Hierarchies | Harrison Monarth | HBR Blog

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“Radically flat. That’s the management goal that Tony Hseih, founder of e-commerce giant Zappos, aims to achieve by the end of 2014. To get there, Hsieh plans to toss out the traditional corporate hierarchy by eliminating titles among his 1,500 employees that can lead to bottlenecks in decision-making. The end result: a holacracy centered around self-organizing teams who actively push the entire business forward.”

Michel Baudin‘s comments:

In this strange article, organization, hierarchy, and status is treated exclusively as a psychological issue. There is not a word about the need to get the organization’s work done, and its implications in terms of responsibility and authority.

For example, you need a process to resolve differences of opinion on what needs to be done. Particularly when the choice is not obvious, you need one person mandated to make a decision and take responsibility for the consequences. It’s called a manager.

As an employee, at any level, you need someone who speaks for the company and can tell you its expectations. It’s called a boss.

It may be psychological uncomfortable to follow procedures and report to another human being, but it is generally recognized as a price you have to pay to get 10 people — or 300,000 — to work effectively towards a common goal.

Remove all these structures and procedures, and what do you get? Self-organized teams doing great work? Or indecision, frustration, bullying, and chaos?

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Is it a Bad Idea to Pay a Lean Consultant Based on a Percentage of Cost Savings? | Mark Graban

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Blog post at Lean Blog : The price paid for most management consulting work is based on either a daily rate or some variation of a flat-rate fee based on what is being delivered. Enterprise software pricing is also often fixed. In both cases, the client pays this with some expectation of benefits and even an “ROI” for the customer.[..]

Michel Baudin‘s comments:

I agree with Mark, and I am happy when clients report that they get ten times in benefits what our services cost. A daily fee for work done on site and a fixed fee for deliverables for offsite work are simple arrangements; paying a percentage of benefits, whether cost savings or revenue increases, is a complicated arrangement, conducive to misunderstandings and disagreements.

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Lean and Management Processes

An online sparring partner of 15 years, Bill Waddell, concluded our latest exchange with the following:

“Lean is comprised of three elements: Culture, management processes and tools. While you obviously have a keen awareness of the culture and tools, you continually under-appreciate the management processes, Michael.”

It is a 3-step progression: first, Bill makes a general statement of what Lean is, then he points out a serious shortcoming in my thinking, and finally he misspells my name.

As I am not trying to go global cosmic with Lean but instead remain focused on Manufacturing, rather than Bill’s three elements, I see Lean as having the four dimensions identified by Crispin Vincenti-Brown. Whatever you do has some content in each of the following:

  • Engineering, in the design, implementation, and troubleshooting of production lines.
  • Logistics and Production Control, covering both physical distribution and the processing of all information related to types and quantities of materials and good.
  • Organization and People, covering the structure, sizing, responsibilities and modes of interaction of departments in production and support, to run daily operations, respond to emergencies, and improve.
  • Metrics and Accountability. How results are measured and how these measurements are used.

Attention must be appropriately balanced in all of these dimensions and, if one is under-appreciated in the US, it is Engineering, not Management. Metrics and organization issues hog the attention; what little is left over goes towards Logistics and Production Control, and Engineering is taken for granted. The tail is wagging the dog, and reality bites back in the form of implementation failures.

What is a management process, and how does it differ from a tool? The term sounds like standard management speak, but, if you google it, the only unqualified reference to it that comes up is in Wikipedia, where it is defined as “a process of planning and controlling the organizing and leading execution of any type of activity.”

Since Henri Fayol, however, we have all been taught that the job of all managers is to plan, organize, control, and lead. In those terms, there doesn’t seem to be any difference between a “management process” and just “management.” All other Google responses are for the processes of managing different functions, like the “Project Management Process,” “Performance Management Process,” “Change Management Process,” or the “A3 Management Process.” The corresponding images are a variety of box-and-arrow diagrams, pyramids, wheel charts, dish charts, and waterfalls/swim lanes, as in the following examples:

A manufacturing process is the network of tasks to make a product from materials — with routes that merge, branch, and sometimes even loop. A business process, likewise, is a network of tasks to turn inputs into outputs, like the order fulfillment process that turns customer orders into deliveries. A political process  is also a network of tasks leading to a particular result, like the election of a president or the approval of a budget. So, what about a management process? And what is the level of appreciation that it deserves?

Bill is the one who should really explain it, but, if I were to use this term, at the most basic level it would be for what I have been calling protocols, by which I mean the part of management work that is done by applying sets of rules or procedures rather than making judgement calls. They are pre-planned responses to events that might occur but are not part of routine operations. It can be the arrival of a new member into a team, the failure of a truck to show up, or a quality emergency.

This is the spirit of Toyota’s Change Point Management (CPM), in which the pre-planned responses are prepared by the teams that are potentially affected by the events and posted in the team’s work place. When the event occurs. all you have to do is retrieve the plan and you know what to do. And it is usually a better plan than what you would have improvised in the heat of the moment.

At a higher level, I would call process a protocol used to organize the way you make judgement calls. You can’t set the strategy of a company by applying rules, but you can use Hoshin Planning to organize the way you do it. A process like Hoshin Planning is akin to the rules of a game; it doesn’t determine how well the managers play. If they just comply with a mandate and go through the motions, they will produce a certain result. If, on the other hand, they understand what they are doing, connect it to their own work, and see the value in  it, then they will produce a different result.

A good process does not guarantee a good outcome, and great teams have been able to coax performance out of dysfunctional processes. What is the proper level of appreciation for these management processes? Clearly, there is more to management than processes, and the best managers are those who excel at endeavors for which there is no script.

I learned to appreciate the relationship between management and engineering in Manufacturing from working with my mentor, Kei Abe. When he took me on as a junior partner in 1987, one of the first things I learned from him was to approach problems in a holistic manner, simultaneously at the technical and and the managerial levels. I saw him coach a shop floor team on the details of SMED in the morning, and the board of directors on company strategy in the afternoon. It’s not a common mix of skills, but I believe it is what a manufacturing consultant should have.

Employees are Colleagues, Not Assets | Eric Bigelow | IndustryWeek

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“A lot of organizations claim that employees are their greatest assets. To many this seems like a very profound way to view the employees. I disagree. I think that this terminology can be very harmful to organizational culture.

The word asset means ‘anything tangible or intangible that is capable of being owned or controlled to produce value.'”

Michel Baudin‘s insight:

This is a point I have grown tired of making in vain. Assets are things you own and, unless they are slaves, you don’t own the people who work for you. Saying “People are our greatest assets,” is not only inaccurate and distasteful, it also suggests that you want to have as many assets as you can.

In private life, it may be true: the more you own, presumably, the better off you are. Business, however,  is different: you want to generate income with as few assets as you can get away with. That’s why you monitor ratios like “Return on Assets.”

Assets and liabilities are mistakenly viewed as positives and negatives. They are in fact technical terms from accounting to designate respectively what you own and what you  owe. Whether you like it or not, you own excess inventory, and it is an asset you would rather not have. A 0% long-term loan, on the other hand, is a liability you are happy to have.

In and of themselves,  employees are neither assets nor liabilities. On the balance sheet, what the company owes them in benefits appears in the Liabilities column. So does the shareholders’ equity. There should be no value judgement attached to terms like Asset or Liability.

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