Three basic ideas:

Use an output-oriented approach to management, like manufacturing
High output depends on using managerial leverage at a team, not individual, level
The team only performs well if the individuals perform well

Foreword

All you can to improve the output of an employee is motivate and train. If you are not training, then you are basically neglecting half the job. (of management)

CEOs always act on leading indicators of good news, but only act on lagging indicators of bad news. In order to build anything great, you have to be an optimist, because by definition you are trying to do something that most people would consider impossible. Optimists most certainly do not listen to leading indicators of bad news.

Ch 1

(Optimizing tech interviews: build the sequence around its most expensive feature, which is the students' trip to the plant. Cost of travel + manager time.) To minimize the use of this step per final college hire, we obviously have to increase the ratio of accepted offers to applicants invited to visit the plant, which we do by using phone interviews to screen people before issuing invitations.

A college graduate to whom we are ready to extend an employment offer is more valuable to us than the college student we meet on campus for the first time.

A common rule we should always try to heed is to detect and fix any problem in a production process at the lowest-value stage possible. If we can decide that we don't want a college candidate at the time of the campus interview rather than during the course of a plant visit, we save the cost of the trip and the time of both the candidate and the interviewers.

Ch2

To run your operation well, you will need a set of good indicators, or measurements. Candidates:

sales forecast
raw material inventory
equipment condition
manpower
quality indicator

Indicators tend to direct your attention toward what they are monitoring.

Obviously, you measure a salesman by the orders he gets (output), not by the calls he makes (activity).

We can draw a black box to represent college recruiting, where the input is the applicants on campus and the output is college graduates who have accepted our employment offers.

Ideally, inventory should be kept at the lowest-value stage. The lower the value, the more production flexibility we obtain for a given inventory cost.

To get acceptable quality at the lowest cost, it is vitally important to reject defective material at a stage where its accumulated value is at the lowest possible level. Such decisions can only be made properly by a balanced group of managers. This group can weigh all the consequences of rejecting or accepting substandard raw material.

(To balance quality needs, there are two types of inspections: gate checks and monitoring. The first is more thorough, the second is faster and based on sampling.) For the same money we can do a lot more monitoring than gate-type inspections... we may well contribute more to the overall quality of the product. As a rule of thumb, we should lean toward monitoring when experience shows we are not likely to encounter big problems.

(One way to increase the productivity of the black box is work simplification.) To implement the actual simplification, you must question why each step is performed. Typically you will find that many steps exist in your work flow for no good reason.

Ch 3

On reports

Value stems from the discipline and the thinking the writer is forced to impose upon himself as he identifies and deals with trouble spots in his presentation. Reports are more a medium of self-discipline than a way to communicate information. Writing the report is important; reading it often is not. (Status reports often follow this logic)

To improve and maintain your capacity to get information, you have to understand the way it comes to you. Verbal sources are the most valuable, but what they provide is also sketchy, incomplete, and sometimes inaccurate, like a newspaper headline. Your information sources should complement one another, and also be redundant because that gives you a way to verify what you've learned.

It's obvious that your decision-making depends finally on how well you comprehend the facts and issues facing your business. Information-gathering is the basis of all other managerial work.

Work done in advance of the planning meeting obviously has great leverage.

(On the negative leverage of managerial meddling, or micro-management) The subordinate will begin to take a much more restricted view of what is expected of him, showing less initiative in solving his own problems and referring them instead to his supervisor. The output of the organization will consequently be reduced in the long run.

Avoid the charade of insincere delegation. Delegation without follow-through is abdication. Because it is easier to monitor something with which you are familiar, if you have a choice you should delegate those activities you know best.

As a rule of thumb, a manager whose work is largely supervisory should have six to eight subordinates; three or four are too few and ten are too many. A manager should allocate about a half day per week to each subordinate. (too little is not enough monitoring, too much is meddling)

Ch 4

(Two basic kinds of meetings:

process-oriented = information is exchanged, knowledge shared, regularly scheduled basis
mission-oriented = ad-hoc, designed to solve a specific problem and produce a decision

)

A key point about a one-on-one: it should be regarded as the subordinate's meeting, with its agenda and tone set by him.

Staff meetings

It should be mostly controlled, with an agenda issued far enough in advance that the subordinates will have had the chance to prepare their thoughts for the meeting. The supervisor's most important roles are being a meeting's moderator and facilitator, and controller of its pace and thrust.

Mission-oriented meetings

The chairman must have a clear understanding of the meeting's objective. Before calling a meeting, ask yourself: What am I trying to accomplish? Then ask, is a meeting necessary? Or desirable? Or justifiable?

Routine meetings will take care of maybe 80 percent of the problems and issues. (mission-oriented meetings for the rest)

Ch 5

Status symbols most certainly do not promote the flow of ideas, facts, and points of view.

Each time an insight or fact is withheld and an appropriate question is suppressed, the decision-making process is less good than it might have been.

Ch 9

Hybrid organizations and the accompanying dual reporting principle, like a democracy, are not great in and of themselves. They just happen to be the best way for any business to be organized.

(The hybrid model might be thought of as functional and technical manager matrix, or like administrative and faculty management in a university)

The two or multi-plane organization is very useful. Without it I could only participate if I were in charge of everything I was a part of.

Ch 10

(culture is) a common set of values, a common set of objectives, and a common set of methods. These can only be developed by a great deal of common, shared experience.

If our behavior at work will be regarded as in line with the values we profess, that fosters the development of a group culture.

Ch 13

Giving performance reviews is a very complicated and difficult business and we, managers, don't do an especially good job at it.

No action communicates a manager's values to an organization more clearly and loudly than his choice of whom he promotes.

Ch 14

The purpose of the interview is to:

select a good performer
educate him as to who you and the company are
determine if a mutual match exists
sell him on the job

Here we sit somebody down and try to find out in an hour how well he is likely to perform in an entirely new environment. If performance appraisal is difficult, interviewing is just about impossible. The fact is, we managers have no choice but to perform the interview, no matter how hard it is. But we must realize that the risks of failure are high.

The applicant should do 80 percent of the talking during the interview, and what he talks about should be your main concern.

( The four categories of knowledge you seek are ) Technical Proficiency, What He Did With Knowledge, Discrepancies, Operational Values.

The ultimate purpose of interviewing is to make a judgement about how the candidate would perform in your company's environment. (You) project the candidate's future performance in a new environment based on his own description of past performance.

You can't get away from relying on a candidate's self-assessment. Don't worry about being blunt; direct questions tend to bring direct answers.

The candidate can tell you a great deal about his capabilities, skills, and values by asking you questions. Ask the candidate what he would like to know about you, the company, or the job.

If possible, you should talk with the applicant again after you have checked his references, because you may have gotten some new perspectives.

Remember, a candidate is a potential employee. He will go away from having talked to you with a strong set of first impressions. If those are wrong and you hire the person, it will take a long time before they change. So show yourself and your environment as they really are.

This is what I most dread as a manager: a subordinate, highly valued and esteemed, decides to quit. If he feels his efforts have gone unrecognized, you have not done your job and have failed as his manager. This subordinate is valuable and important because he has attributes that make him so. Other employees respect him; and if they are like him, they identify with him. So other superior performers like him will track what happens to him, and their morale and commitment to the company will hinge on the outcome of this person's fate.

Ch 16

Much deeper knowledge of a task is required to teach that task than simply to do it.