“Simplicity-Minded Management”

Ron Ashkenas

Harvard Business Review

December 2007, pp. 101-109

Organizations have become increasingly complex, ungovernable and unwieldy. Performance is declining, accountability is unclear, decision rights are muddy and data are crunched repeatedly, often with no clear purpose in mind. The author of this article and his colleagues have studied the sources of organizational complexity and identified several areas of opportunity that need to be address simultaneously in a “multidimensional, ongoing strategy”:

• Make simplification a goal not a virtue—Approaches include:
• Include simplicity as a theme of the organization’s strategy
• Set specific targets for reducing complexity
• Create performance incentives that reward simplicity
• Simplify the organizational structure—Approaches include:
• Reduce levels and layers
• Increase spans of control
• Consolidate similar structures
• Prune and simplify products and services—Approaches include:
• Employ product portfolio strategy
• Eliminate, phase out, or sell low-value products
• Counter “feature creep”
• Discipline business and governance processes—Approaches include:
• Create well-defined decision structures (councils, committees)
• Streamline operating processes (planning, budgeting, and so on)
• Involve employees at the grass-roots level
• Simplify personal patterns—Approaches include:
• Counter communication overload
• Manage meeting time
• Facilitate collaboration across organizational boundaries

The article includes a survey to help a manager gauge their organization’s “complexity quotient”. It also provides a set of questions for senior executives to ask themselves to assess their own complexity-inducing behaviors.

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“Strategic Deployment: How to Think Like Toyota”

Jill Jusko

Industry Week

November 2007, pp. 34-37

This article argues that Toyota’s success derives to a great extent from its planning and execution system, known by various names as hoshin kanri, hoshin planning, strategy deployment, or policy deployment. It “aims to formulate clear corporate objectives and goals, disseminating and aligning those objectives throughout all levels of the organization, and then creating plans of action to achieve those objectives.”

The article identifies the key elements of hoshin planning as:

• Hoshin planning is driven by the organization’s vision, not today’s problems
• It is a system to translate the vision into tangible and measurable objectives for achieving the breakthroughs
• Alignment is created by cross-functional planning to achieve short-term objectives each year
• Hoshin planning fosters learning through the review process
• The Plan-Do-Check–Act cycle of continuous improvement is at the heart of the hoshin process
• “Catch-ball” is the driving force of alignment, clarification, and employee involvement

In Industry Week’s 2007 Census of Manufacturers, 26.9% of US manufacturing plants say strategic or policy deployment occurs in their facilities. This is especially common in plants of 500 employees or more, where the figure is 53.3%.

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“Taming the Dragon: A Look at the Current State of Manufacturing Operations in China”

David Blanchard

Industry Week

November 2007, pp. 28-33

Industry Week recently collaborated with the Manufacturing Performance Institute to study the current state of manufacturing in China.

When asked to name their top three market strategy objectives, Chinese manufacturers listed:

• High Quality (83.3%)
• Low Cost (56.6%)
• Innovation (53.9%)
• Service and Support (28.2%)
• Fast Delivery (23.9%)

US manufacturers listed

• High Quality (73.7%)
• Service and Support (55.8%)
• Total Value (41.2%)
• Fast Delivery (32.0%)
• Customization (26.6%)

While lean manufacturing is the predominant improvement methodology in the U. S., in China 81.7% use total Quality Management, 25.1% use lean manufacturing, 19.3% use agile manufacturing, 7.8% use theory of constraints, and 3.0% use Six Sigma.

When comparing strategic practices within plants:

• Customer Satisfaction Surveys are used by 59.6% in China and 51.4% in the U. S.
• Quality Certifications such as ISO are used by 54.6% in China and 55.9% in the US
• Continuous improvement is used by 47.4% in China and 76.9% in the US
• Total Productive Maintenance is used by 40.2%% in China and 34.2% in the US
• Environmental Management is used by 33.9% in China and 43.6% in the US
• Open-Book Management is used by 24.9% in China and 16.0% in the US
• Kaizen Events/Blitzes are used by 19.5% in China and 45.5% in the US
• Recycling/Reuse Programs are used by 16.5% in China and 56.1% in the US
• Value Stream Mapping is used by 9.2% in China and 45.5% in the US

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“What Every Leader Needs to Know About Followers”

Barbara Kellerman

Harvard Business Review

December 2007, pp. 84-91

This article argues that in spite of all the emphasis on leadership research, followers have hardly been studied at all. There are three authors who are exceptions:

• Abraham Zaleznik looked at “dominance vs. submission” (ranging from those who want to control their superiors to those who want to be controlled by them) and “activity vs. passivity” (ranging from those who initiate and intrude to those who do little or nothing), and segmented them into four categories: “impulsive”, “compulsive”, “masochistic” and “withdrawn”.
• Robert Kelley identified five different follower styles:
• Alienated followers—who “think critically and independently but do not willingly participate in groups of which they are members”.
• Passive followers—who “do not think critically and do not actively participate”.
• Conformist followers—who “do participate in their groups and organizations but are content simply to take orders”.
• Exemplary followers—who are “nearly perfect, or at least they perform well across the board”.
• Pragmatic followers—who “play both sides of the fence, ranking in the middle in terms of independent thinking and level of activity”.
• Ira Chaleff classified followers based on how much they supported leaders and how much they challenged them. His four types of followers are:
• Implementers—who are the most common, and who are depended upon to get work done without much questioning.
• Partners—who strongly support their leaders but also challenge them when necessary.
• Individualists—who “tend to withhold support from people in positions of authority”.
• Resources—who do what’s expected of them, but not much more.

The author, Barbara Kellerman, proposes another typology based on level of engagement. Her categories are:

• Isolates—who “do not care about their leaders, know anything about them, nor respond to them in any obvious way.” These are most often found in large companies, where they are not very visible so long as they do their jobs at a minimal level.
• Bystanders—who stand aside and disengage, without participating in an active way. They may go along passively when necessary, but their withdrawal acts as tacit support.
• Participants—who care enough to try to make an impact. They may support or oppose their leaders.
• Activists—who “feel strongly one way or another about their leaders and organizations, and they act accordingly. These followers are eager, energetic, and engaged”; They may work hard on behalf of their leaders or against them.
• Diehards—relatively rare individuals who “are prepared to go down for their cause—whether it is an individual, an idea, or both...They exhibit an all-consuming dedication to someone or something they deem worthy”.

“Good followers” are those who:

• Do something
• Actively support an effective and ethical leader and actively oppose a leader who is bad
• Invest time and energy in making informed judgments about who their leaders are and what they think, and then take appropriate action

Similarly, “bad followers”:

• Will make no positive contribution
• Will actively oppose a leader who is good
• Will actively support a leader who is bad

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“The Japanese Management Metamorphosis: What Western Executives Need to Know About Current Japanese Management Practices”

Markus Pudelko and Mark Mendenhall

Organizational Dynamics

Vol. 36, No. 3, pp. 274-287

The authors of this article analyzed data from 68 Japanese firms “to better understand the perceptions and opinions of Japanese managers regarding the viability of adopting Western management practices”.
Some key findings were:

• The Japanese managers perceived their management systems to be in a state of crisis.
• Japanese companies are undergoing profound strategic reorientation. There is a shift to shorter-term orientation, to less over-diversification, and the scaling down of traditional company networks (or “keiretsu”).
• Japanese companies are opening up more to outside influences.
• There are major shifts in HR practices, including more focus on individual performance (instead of seniority) for compensation, more flexibility in recruitment practices (including less emphasis on lifelong employment), and more focus on specialists instead of generalists.

The article also discusses where the authors think Japanese management is heading and how Western companies should react to these changes.

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Making It Stick

John McNeil, GP
 

Jill Jusko points out that Toyota plans well. But this is like the story of the blind men who approach the elephant only to report severally that it is like a rope (the one who held the tail), a house (the one who felt the side), a tree (the one who grabbed a leg) and a snake (the truncated blind man). Great organizations plan well, pursue Ashkenas’ simplicity, have great leaders and followers and leverage all of Blanchard’s tools. They also stick at the very basics until they succeed. In fact, rather than tools, we often find that this focus on doing the basic blocking and tackling in a repeatable fashion is what is the hardest and most critical component of continuous improvement.

Why doesn’t everyone do this? We have found that:

• Process improvements backslide. Organizations that conduct kaizen events typically report dramatic improvement at the end of each event. However, check on the performance six to nine months later and often the reported performance has deteriorated. Backsliding also occurs with many other process-improvement projects.
• A limited percent of the organization is involved. At one of our clients, a Six Sigma team took on a process that generated an 11% scrap rate and reduced it to 5%—a success for the Black Belt and team. Months later, however, the scrap rate remained virtually unchanged when a number of small, front-line initiated process changes should have reduced scrap to well below 5%. Clearly, the front-line workers were not engaged in continuing to improve performance. Although executives, sponsors, and belts all received training, these groups totaled less than 7% of employees and the vast majority of employees were not really part of the initiative. Lacking a sufficient critical mass, the initiative stalled.
• Workforce development is absent or insufficient. Another client supplied an automotive OEM with critical parts, but defects resulted in line stoppages—a costly issue for both the supplier and the OEM. Most of the defects occurred in the molding department and one countermeasure required that the molding operators remove the part from the mold using a specific movement. Unfortunately, the front-line leaders lacked the skills to teach the operators correctly the required de-molding process or to continue to check that the operators followed the standard. Without these skills, and other critical skills for supervisors, the organization will continue to struggle.

Where do we learn to do these basic things well? Surprisingly, we often can find exemplary performance within our own organizations. A ready path to success is to transfer the knowledge, skills and abilities of Kellerman’s Good Followers to the Bystanders and Participants. In that way, great plans can be executed in great ways by the great employees that we tell ourselves we have.

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