Review Book of High Output Management

October 13, 2024 (1y ago)

by Satrya ⚡

Introduction:#

  • By Andrew Grove — worked at Intel, former CEO of Intel.
  • Key ideas:
    1. Output oriented approach to management
    2. Managerial leverage: what managers to do to increase the output of their teas.
  • User sports analogy, task-relevant feedback

Chapter 1: The Breakfast Factory#

  • delivery products at a scheduled delivery time, at an acceptable quality level, and at the lowest possible cost.
  • Limiting Steps: construct production flow by starting with the longest (or most diffcult, or most sensitive, or most expensive) steo and work our way back.
  • Adding value for steps
  • detect and fix any problem in production porcess at the lowest-value stage possible.

Managing the Breakfast Factory#

  • Need a set of good indicators or measurements.

  • Breakfast factory example:

    1. Sales Forecast— variance between plan and the actual delivery
    2. RAW Material inventory — enough materials to run factory today.
    3. Equipment Condition — is it good or broke? need to repair
    4. Manpower — enough to backup if someone sick.
    5. Quality Indicator — setup customer complaint log.
      • Good indicator: physical and countable thing
      • e.g vouchers processed, square feet cleaned, sales orders entered, transactions procesed, people hired, item managed in inventory.
      • it has effect of motivation

  • Leading Indicators

    • linearity indicators
    • trend indicators can use stagger chart for forecasting.

  • indicators can be a big help in solving all types of problems.

  • controlling future output by creating a forecast.

  • Do quality assurance to inspect at lowest value points.

  • increase productivity

    • faster; reorg the work area or hard work.
    • second way is, increase ratio of output to activity by leveraging; work smarter, not harder.
    • SWE — solve many problems per hour of programming.
    • leverage by automation; work simplification.

  • Stressing output is the key to improving productivity, while looking to increase activity can result in just the opposite. Improving productivity is best achieved by concentrating on the quality and quantity of the output rather than simply increasing the amount of activity

Chapter 2: Management is a Team Game#

Managerial Leverage#

  • Manager's output = the output of his organization + neighboring organization under his influence.
  • Manager's life activity are conveying information, making decisions, and being a role model for your suboridantes.
  • Managerial productivity can be increased in 3 ways:
      1. Increasing the rate with which a manager performs his activities, speeding up the work.
      1. Increasing the leverage associated with the various managerial activities.
      1. Shifting the mix of a manager's activities from those with lower to those with higher leverage.
  • Delegation as leverage, should follow through.
  • Time-management techniques is most common approach.
  • Batching similar task.
  • Calendar is medium of manager's forecast.
    • active to use the calendar, fill the holes between time-critical with non-time critical.
    • should say no for work beyond the capacity.
  • Allow slack — a bit of looseness in the scheduling.
  • Follow well-established procedures and, rather than reinveting the wheel repeatedly.
  • Rule of thumb, 6-8 subordinates.
  • Handle interruptions with active decision instead of hiding. Communicate like, 'I am doing individual work. Please, don't interrupt me unless it really can't wait until 2:00'.

Meetings#

  • Spend 50% in meetings, mostly wasted time.

  • Meeting as "non-contributory labor" that managers must endure.

  • Meeting is the medium through which mangerial work is performed e.g supply information and know-how.

  • Process-oriented meetings — one-on-one meeting, staff meeting, and operation review.

  • 1:1 meeting — a supervisor and a subrodinate are mutual teaching and exchange information. Talking about specific problems and situations, the supervisor teaches the subordinate his skills and know-how, and suggests ways to approach things The subordinates provides the supervisor with detailed information about what he is doing and what he is concerned about.

    • The 1:1 meeting frequency should based on the subordinate experience. More frequently if inexperienced.
    • 1 hours long at a minimum
    • agenda and tone set by subordiante.
    • should cover anthing important since the last meeting: news, hiring problems, people problem, future plans, and potential problem.
    • should have 1:1 notes.
    • encourage heart-to-heart issue, e.g satisfied with performance, frustration, carrer path.
    • subordinate can teaches the supervisor, about what he found — sharing his base information with supervisor.
    • also 1:1 meeting can be implmeneted in our family.

  • Staff meeting — supervisor and all of his subordinate participate.

    • discuss anything like brainstroming session or controlled with agenda.
    • ask questions if something is not clear

  • Mission-Oriented Meetings — held by ad hoc chairman and designed to produce a specific output, frequently a decision.

Decisions, Decisions#

  • Flow: Free Discussion -> Clear Decision -> full support; if wrong, looping again start from free discussion.
  • any decision be worked out and reached at the lowest competent level as it will be made by people who are closest to the situation and know the most about it.
  • Peer-group syndrome — decision made by just one group, afraid to speak their mind.
  • Peer-plus-one approach — peers tend to look for a more senior manager for take over and shape a meeting.
  • Overcome that with self-confidence — remember that nobody has ever died from making wrong decision.
  • Don't fear of sounding dumb.
  • don't push for a decision prematurely.
  • Manager key task questions:
    • what decision needs to be made?
    • when does it have to be made?
    • who will decide?
    • who will need to be consulted prior to making the decision?
    • who will ratify or veto the decision?
    • who will need to be informed of the decision?

Planning: Today's Actions for Tomorrow's output#

  • General planning steps — project need, established present status, compare, and reconcile step 1 and 2.
  • Step 1: environmental demand
    • environment: customer, stakeholders, vedors, and competitiors.
    • examine environment in 2 time frames:
      • now and in a year
      • e.g what do my customers want from me now? what will they expect from me 1 year from now?
  • Step 2: present status
    • detemine it — capabilities and the projects you have in the works.
    • some project may get scrapped or aborted.
  • Step 3: What to do to close the gap?
    • gap between your environmental demand and your present activities will yield.
    • undertaking new tasks or modifiying old ones.
    • Questions:
      • what do you need to do to close the gap?
      • what can you do to cloe the gap?
    • strategy: set of actions decided.
    • tactic: what action to implement the strategy.
    • Output of the planning process is the decisions made and the actions taken as a result of the process.
    • Need feedback for the next planning.
  • Management by objectives (MBO) — should know quite well what our environment demands from us.
    • Need to answer 2 questions:
      1. WHere do I want to go? (objective)
      2. How will I pace myself to see if I am getting there? (key results)
    • Shuld focus on small objectives — focus on everythings -> focus on nothing?.
    • if subordinate's objectives are met, the supervisor's will be as well.

Chapter 3: Team of Teams#

  • game of management is a team game — a manager's output is the output of the organizations under his supervision or influence.
  • have to build a team of teams, where the various individual supportive relationship with each others.

Hybrid organizations#

  • organizations forms: 2. Mission-Oriented; 2. functional form.
  • In the mission oriented organization — completely decentralizaed, each indivudal business unit purses what it does e.g branching.
  • In the functional form — completely centralized. It has finance department, that manage all finance in all branches.
  • Good manager has to balance the combincation of responsiveness and leverage.
  • Hybrid: mixed mission and functional.

Dual Reporting#

  • report two or more individual to make hybrid organizations work.
  • report to peers manager, skip manager that know the works.
  • or has two supervisor because of functional organization and mission oriented function.

Modes of Control#

  • Our behavior in a work environment can be controlled by:

    • free-market forces
    • contractual obligations
    • cultural values

  • fee-market forces — get best possible price.

  • contractual obligations — there are some kind of work will do and the standars that will govern it.

  • cultural values — believe all share a commont set of values, objectives, and methods. So it gives trust.

  • CUA (Complexity, Uncertainty, and Ambiguity) factor —

    • free-market: low factor and more for self-interset.
    • contractual-obligations: low factor and more for group interest.
    • cultural-values: high factor and more for group interset.
    • when CUA factor is high and is based on self-interset, no mode of control will work well.

  • the employee can then be promoted into a more complex, uncertain, amiguous jobs, that tend to pay more as long as he ready for it.

  • bring young people in at relatively low-level, well defined jobs with low CUA factors, and over time they will share experiences with their peers, superviosrs, and subordinates. and will learn the values, objectives, and methods of the orngaization. They will gradually accept, even flourish in, the complex world of multiple bosses and peer decision-making.

  • Senior person tends to has having high self-interest, and manage organization that in trouble. It's very high CUA (no experience best common practive of organization). Hope for the best for his jon to reduce his CUA factor.

Chapter 4: The Players#

  • The single most important task of a manager is to elicit peak performance form his subordinates.
  • How? create an environment in which motivated people.
  • better motivation means better performance.
  • In early days of Industrial Revolution — motivation was based mostly on fear of punishment. not worked->not paid->can't buy food.
  • Abraham Maslow's theory — motivation is closely tied to the idea of needs, which cause people to have drives, which in turn result in motivation.
  • Maslow hierarchy: bottom to top
    • Physiological — needs of things that money can buy (food, clothing, house, etc)
    • Security/Safety — protect oneself from losing basic necessities. e.g medical assurance.
    • Social/Affiliation — quite powerful because people want to be around to people they want.
    • Esteem/Recognition — when a need is gratified it can no longer motivate a person (self-limiting).
    • Self-Actualization — "What I can be, I must be". it continues to motivate people to ever higher levels of performance.
  • Culvative achievement-driven motivation -> values and emphasize output.
  • Money and Task-Revelant Feedback — money is important. but some people thinks more money and a steady job provided no more motivation. in self-actualize money will be measure of achivement. money in lower level only motivates until the need is satisfied.
  • How to test someone in motivational hierarcy? — if the abosulte sum of raise in salary an individual receives is important to him, he is wokring moslty within the physicological or safet modes. if, however what matters to him is how his raise stacks up againsts what other people got, he is motivated by esteem/recognition or self-actulaization, because in this case money is clearly a measure.
  • Can not stay in the self-actualized mode if you're always worried about failure. So no fear!
  • What manager do to motivate the subrodinates?
    • train individuals to horizontal axes of individual capability.
    • bring them to the point where self-actualization motivates them.
  • How to lead people to self-actulization?
    • think about marathon runner, they trying to beat other people or the stopwatch.
    • beat the metrics, like distance, the clock, or other people.
    • endow work with the characteristic of competitive sports.
    • manager is the coach — takes no personal credit, turst, tough the team, critical, good player at on time, also understand it well.
    • turning the workplace into a playing field can turn our subordinates into athlete dedicated to performing at the limit of their capabilities.

Task Relevant Maturity#

  • Task-revelvant maturity (TRM) of the subordinates — combination of the degree of their achivement orientation and readiness to take respobsibility, as well as eduication, training, and experience.
  • effective management style is TRM of the subrodinates.
    • TRM: low —> management style: structrued, task oriented (what, when, and how)
    • TRM: Medium —> management style: individual-oriented; emphasis on 2-way communication, support, and mutual reasoning.
    • TRM: high —> management style: involvement by manager minimal; establishing objectives and monitoring.

Performance Appraisal: Manager as Judge and Jury#

  • why do we review the performance of our suboridantes?

    • to assess the subordinate's work
    • to improve performance
    • to motivate
    • to provide feedback to a subordinate
    • to provide disiplince
    • to provide work direction
    • to reinforce the company culture

  • giving such reviews is the single most important form of task-revelant feedbackwe as supervisors can provide.

  • to improve the subrodinate's performance by determine what skills are missing and to intensify the subordinate's motivation.

  • Assessing performance — it's very difficult; needs to be objective.

    • easier way to define what we want from our subordinates.
    • review manager should review their subordinates too.
    • by asking questions and making judgmental.
    • be careful with 'potential trap' – asses performance not potential.
    • manager can always find ways to suggest improvement, something about which manager need not feel embarrased.

  • Delivering the Assessment.

    • When delivering a review: Level, Listen, and Leave (3L)

      • level — manager should level the subordinate.
      • listen — employing manager entire arsenal of sensory capablities to make certain manager's point are being properly interpreted by the subordinates. Make sure the subrodiantes is receiving your message, and do not stop delivering it until you are satisfied that he is.
      • leave yourself out — manager insecurities, anxieties, guilt, or whatever shold be kept out of it.

    • target a few key areas — scan material such as progress reports, performance againts quarterly objectives, and 1 on 1 meeting notes. write everything down on the paper, do not edit in your head. draw conclusion and specific example to support them.

    • example of worksheet for performance review:

      • Positives:

        • planning process much better! (quick start)
        • good report to Materials Council.
        • helped on Purchasing cost analsis project.

      • Negatives (Just important one):

        • spec process: zero!
        • debating society meetings — all mushy.
        • ppor kick-off for spec training

      • Messages:

        1. Good results on planning system (analytical/financial back ground useful)
        2. Hard time setting clear, crisp goals — satisfied with activities instead of driving results!

    • Concentrating on the stars (high performance person) is a high leverage activity; if they get better, the impact on group output is very great indeed.

    • there is always room for improvement.

    • suboridantes do self-review comes wrong when supervisor revise and give superior rating because it's cheated.

    • give subordinate the written review sometime before the face-to-face discussion.

    • example of perfomance apprisal strucure:

      • output measure: is it good or not
      • internal measure: lacking; activity as output.
      • note: statement supported by example.
      • compliments need example too!
      • attempt to show how to improve performance.

Two Difficult Tasks#

Two other emotionally charged tasks: interviewing a potential employee and trying to talk a valued employee out of quitting.

Interview seek and make judment about the potential from the candidate.

Someone valuable quit — ask why quit, dont argue, seek manager's supervisor help, convice again that him is important to you.

Compensation as Task-Revelant Feedback#

Base salaries detrmine by

  • experience only:
    salary increases with the time he has spent in a particular position.

  • Merit-only aprroach; salary is independent of year experience. but it depends on how well perform in the job.

Promotion — consider Peter Principle: which says that when someone is good at his jon, he is promoted; he keeps getting promoted until he reaches his level of incompetence and then stay here.