All entries for March 2009

March 27, 2009

A bit about 5s, organizing a clean enviroment of work

Reading a bit for the future KBAM PMA (still finishing PEUSS....). It came to my mind and incident and something I learn from an older person.

Many years ago I worked on a structure that had a good mix of (very!) experienced people with (very!) junior employees. I was on the second group but I had risen a bit faster so I actually worked as a kind of assistant to the general manager of the area. One day this manager was assigned to take over another area (as well as the one he already had). The are had a quite repetitive work, dealing with LOTSSSSS of papers. It was very easy to lose a paper in there (and depending on the paper it could have quite serious financial consequences).

This manager of mine was a senior person, with about 15-20 years experience but was not a formally educated person and it also had a bit of difficulties communicating, he was not good at it (even though he had some other fantastic qualities). When he assumed the new are he was appalled by the amount of paper and by the lack of organisation on some people`s desks (even though, to be fair, it seemed to work that way because loosing papers was not a particular problem of that area). The thing is that right in the begining he got everyone together (about 20 people on that area) and said that personal stuff should be kept to a minimum on the desks and that they should be very organised, with everything on defined, standardised places). He understood that by doing that the risk of loosing anything would be minimised as productivity would also increase. I did not know (and I`m pretty sure that to this day he still does not know) that this approach is the basis of the Japanese 5S way of managing the working space. Once again, he did not need to know that theory, was just common sense working (like I said very long ago here in this blog, in the end it is all common sense). That made me think, specially because I`m not a organised person. I`m not going to finish the case because this simple request, done in the way he did (and I told him I think he did not do it properly and he agreed), caused all sorts of problems, uncovering serious relantionship questions and ending with the dismissal of a employee.

That entry if for KBAM, for that reason I`ll not go down the road of discussing the communication issues. But the idea of having a organized space stickied with me. So After that I always had quite a bit of organisation when dealing with work. Documents stay on the right place, with the right names, files are organised on the computer, I always do back up, etc etc. I keep a bit of mess on the space itself, in part because it is part of me and I don`t think would be helpful to add any more stress. Besides in the last few years being creative was part of my profession and a bit of confusion, colours, information are proven to help creativity. But for production places, with many parts, objects I think the idea of having a organised space with established processes make all sense.


March 12, 2009

Less selfish capitalism

Fantastic article from today`s FT. The subject itself can interest anyone. But for the discussions we are having specifically on MBE, towards the end of it the author criticises continuously changing. For some that coulr read as a criticism to the whole notion of continuously improving in order to achieve customer requirements and sustainable success in an ever changing reality. I would not agree.
A few days ago I was having that discussion with a friend that works as a business consultant in Brazil. I was defending the concept of constancy of purpose of Deming and he was going against it. He said we always needed to change. I had to explain here that he was mixing different levels of decision. Of course a company has to always change, because the world changes and if the one does not changes it will simply be left behind. As simple as that. But changing is just a way to allow the bigger objective that should not be changed reachable under circumstances that are always new. For example, if taken that concept described on the article bellow that we should create an economy based on values that are more human that should be a constant vision, considered not only on time of crisis like now, but also on the good times. But to do that we will need to constantly improve, learn and improve how to do it. The purpose is always constant (and the deeper it is, the less changed it should go through. For instance you could say that you major life objective -Being happy?- should never change) or should change very seldom, but the strategy the tactics should constantly change, constantly improve.
It took me quite a while to make him understand my point. It is not easy, and I applied the same thinking to the understanding of this article, specially to the bit on the end.

Now is the time for a less selfish capitalism

By Richard Layard

Published: March 11 2009 20:02 | Last updated: March 11 2009 20:02

What is progress? The Organisation for Economic Co-operation and Development has been asking this question for some time and the current crisis makes it imperative to find an answer. According to the Anglo-Saxon Enlightenment, progress means the reduction of misery and the increase of happiness. It does not mean wealth creation or innovation, which are sometimes useful instruments but never the final goal. So we should stop the worship of money and create a more humane society where the quality of human experience is the criterion. Provided we pay ourselves in line with our productivity, we can choose whatever lifestyle is best for our quality of life.

And what would that involve? The starting point is that, despite massive wealth creation, happiness has not risen since the 1950s in the US or Britain or (over a shorter period) in western Germany. No researcher questions these facts. So accelerated economic growth is not a goal for which we should make large sacrifices. In particular, we should not sacrifice the most important source of happiness, which is the quality of human relationships – at home, at work and in the community. We have sacrificed too many of these in the name of efficiency and productivity growth.

Most of all we have sacrificed our values. In the 1960s, 60 per cent of adults said they believed “most people can be trusted”. Today the figure is 30 per cent, in both Britain and the US. The fall in trustworthy behaviour is clear in the banking sector but can also be seen in family life (more break-ups), in the playground (fewer friends you can trust) and in the workplace (growing competition between colleagues).

Increasingly, we treat private interest as the only motivation on which we can rely and competition between individuals as the way to get the most out of them. This is often counterproductive and does not generally produce a happy workplace since competition for status is a zero-sum game. Instead, we need a society based on positive-sum activities. Humans are a mix of selfishness and altruism but generally feel better working to help each other rather than to do each other down.

Our society has become too individualistic, with too much rivalry and not enough common purpose. We idolise success and status and thus undermine our mutual respect. But countries vary in this regard, and the Scandinavians have managed to combine effective economies with much greater equality and mutual respect. They have the greatest levels of trust (and happiness) of any countries in the world.

To build a society based on trust we have to start in school, if not earlier. Children should learn that the noblest life is the one that produces the least misery and the most happiness in the world. This rule should apply also in business and professional life. People should do work that is useful to society and does not just make paper profits. And all professions – including journalism, advertising and business – should have a clear, professional, ethical code that its members are required to observe. It is not for nothing that doctors form the group most respected in our society – they have a code that is enforced and everyone knows it.

So we need a trend away from excessive individualism and towards greater social responsibility. Is it possible to reverse a cultural trend in this way? It has happened before, in the early 19th century. For the next 150 years there was a growth of social responsibility, followed by a decline in the next 50. So a trend can change and it is often in bad times (such as the 1930s in Scandinavia) that people decide to seek a more co-operative lifestyle.

I have written a book about how to do this and there is room here for three points only. First we should use our schools to promote a better value system – the recent Good Childhoodreport sponsored by the UK Children’s Society was full of ideas about how to do this. Second, adults should reappraise their priorities about what is important. Recent events are likely to encourage this and modern happiness research can help find answers. Third, economists should adopt a more realistic model of what makes humans happy and what makes markets function.

Three ideas taught in business schools have much to answer for. One is the theory of “efficient capital markets”, now clearly discredited. The second is “principal agent” theory, which says the agents will perform best under high-powered financial incentives to align their interests with those of the principal. This has led to excessive performance-related pay, which has often undermined the motive to work well for the sake of doing a good job and introduced unnecessary tension among colleagues. Finally, there is the macho philosophy of “continuous change”, promoted by self-interested consulting companies, which disregards the fundamental human need for stability – in the name of efficiency gains that are often not realised.

We do not want communism – as research shows, the communist countries were the least happy in the world and also inefficient. But we do need a more humane brand of capitalism, based not only on better regulation but on better values.

Values matter and they are affected by our theories. We do not need a society based on Darwinian competition between individuals. Beyond subsistence, the best experience any society can provide is the feeling that other people are on your side. That is the kind of capitalism we want.

Lord Layard is at the London School of Economics Centre for Economic Performance. He has written ‘Happiness’ (2005) and co-authored ‘A Good Childhood’ (2009)


Ch ch ch ch changessss!

The most interesting question I took of from the PIUSS PMA (that tks God, I already sent on Monday) was questioning myself if one is really able to build a planned process to change the culture of an organisation. REading books about it I found lot`s of arguments for (and a few against. Smaller quantities because defending that is not possible is obviously less interesting commercially speaking....)


I particularly think that it is possible. But it will take a LONG time. And will need not only a method, a plan, but a lot of skill and occasionally a quite strong fist. I thing it is almost impossible (if not impossible) to change a whole organisation`s culture (unless, perhaps, if it is a small or recently created organisation) smiling, without beeing quite hard and though from time to time.

But I think is possible and Six Sigma can be a good method to do so, if done properly and with care. 


How much would you pay for all the knoweledge in the world?

I did my MBA in finance. I did not particularly love it, but it was useful. But there was one specific module called asset valuation that I liked. I was particularly impressed with a book called "Value at Risk"by an Indian-American scholar called Damodaran. He is a major expert on the subject (Actually pretty much all his writings are available for free in his web page http://pages.stern.nyu.edu/~adamodar/ ) . It was fascinating the way he worked solutions to try to put a value on everything (on a economical sense, of course). For example, how to measure the value of an organisation that never profited? Or of something that is still a plan? He discuss it. 

Of course that is interesting only for people that enjoy financial matters (And important to say not all economists understand or like finance. Several economists are dedicated to historical questions, or development, or marketing related issues, etc etc). But that idea of trying to find a way (creative, often) to measure things often comes to my mind.

All techniques we study recommend (and that is quite logical) that measures should be established to measure the evolution of the initiatives. Fantastic. How to measure knowledge? Of course there are processes and suggestions in several papers. You could measure number of improvements taken from knowledge present on a database, or number of ideas collected from employees, etc etc. BUt is that a good measure?

One could also think about how much money was taken out of an database, or how many bytes on a database..all numerical measures. But are that a good wat to measure?

Of course the best way would depend on the circumstance, on what you are using Knowledge Management for (and a very important feature is that you have to know EXACTLY what you are using it for, exactly what you are expecting to gain from it.


But is something hard to measure...

 



March 08, 2009

Rewards, good or bad?

Every organisation I have always been part of had rewards of some sort. IF you behaved properly, a reward (and sometimes if you didn`t a punishment). Every chance I had to organise something on my professional life took that into consideration. I created prizes related to process improvement, to Knowledge Management, etc. I must say I remember reading some people against this kind of approach, but never paid attention to it. When working on my OPP and CBE PMA`s a found this book (Punished by Rewards - The problem with gold stars, incentive plans, A`s,praise and other bribes) that defended the opposite idea. He said people did not change because of those bribes. They just tried to cheat the system. Once again is something that relates to Deming, that was also not a fan of it. His argument builds on psychology, and is very well defended and rational. I used it as a criticism and reflection in my OPP, CBE, and PIUSS PMA. That came to my mind because in PIUSS several authors defend it a form of making a new culture stick. Create punishments and rewards for those who behave. Today reading something about KBAM I found the same kind of argument. I must say I think the logic behind the book is perfect. I can not argue against it. On the other hand, perhaps out of habit I still can`t think this is wrong. The only defence I can present, however, that if people are not changed by prizes or punishment at least you use those prizes to communicate, to indicate what is desired. This might raise awareness, might make people think about why this reward/punishment is been applied and if you can clearly communicate the reason....another possible advantage is that by giving recognition to someone who behaved in an specific way you could be just saying a "thank you"to someone who did something that the organisation understands is good and desired by it. And that can be used on a Six Sigma program or in a KM initiative. But I agree that people will not change just because of that, they can see that, reflect on it and perhaps change out of their reflection, but not because of the reward itself.


targets

Sometime ago I had a discussion in this blog with the Deming idea that one should not put targets on production. It took a while for me to fully understand and agree that the problem were not the targets themselves, but individual production related targets were wrong. For example, having the idea of continuously improving a company is a target because you will have to measure and identify that those measures are improving. That is the target, improving.

However everything you study and see asks for measures. Study for KBAM one of the procedures that is recommended is to have measures and to attach those measures to results and numbers. And those measures/targets have to be SMART, (what means they should be specific...). So that is an important balance. You need to have objectives and some degree of objectivity is needed , some target is needed. But that has to be real and collective, and has to be thought in such a way that will stimulate everyone to drive honestly together, everyone to work as a system toward this guiding objective.

So that is the hard thing, have objectives that help the system to improve, have the people to know what to do and that actually bring performance benefits that are real and not only created to achieve short term advantages.

 



March 02, 2009

Knowing is more them having

About 1,5 years ago I decided to go overseas to study. I had that dream for a while but for one reason or the other I had not done it. However that moment seem very appropriate.

I started looking for it and found all the information's needed. I liked everything but one thing. It was a very expensive thing to do.  I looked for scholarships and they were available however if I wanted them I would have to wait at least one more year and that could have completed cancelled the possibility of coming due to several personal and professional issues.

The thing is, I had money for that. I`ve been working since I was a teenager and I managed to save money for that. I had just enough with a certain margin of safety (and of course if something REALLY out of control, a special Cause happened, I had some emergency alternatives in place). But was it worth? Would not I be better off keeping it, or using it to help me buy a flat or something else?

The first answer to my problem came from my financial background. I calculated what this degree could bring to me in terms of salary increase and compared it to what the overall amount of money would give me interest-wise in a low risk application (if you prefer, made an economical cost calculation using the cost of opportunity concept).  It made sense to spend it that way.

Second I had a very nice conversation with an uncle I have.  And he reminded me of something I always said but had forgotten. What you know is worth much more then what you have. That is specially true when we are young. Knowledge is the best possible asset. No one will never be able to take it away from you. And in this digital workd even more. That was the killing argument, and perhaps the main reason why I am here in the first place.

Therefore it makes all sense the people and organisations should do their best to manage knowledge, to try to make the best out of it. That`s actually what they are paying for when hiring people, specially expensive ones.



March 01, 2009

Six Sigma

Working on PIUSS PMA I read a lot about 6 sigma. Somebody asked what it was and I was trying to explain. SOmething that comes to my mind that I think it is quite interesting is the idea that a method that started basically as statistical control of processes evolved to became a sort of philosofical way of thinking management. It became something bigger, broader. The concept evolved and could be used to all process in te company.

I have only two strong criticisms to it. First the most common way to address it have little concern for human related issues. It needed a bit more of soft skills in my opinion. Second, I think variation works well for the average and mass production. But human beings are individuals, hard to establish limits, averages for several activities that are basically human. For example, assuming everything is a system, every system has processes that are measurable. But and if this system has someone fantastic, a genius? 

Just thinking.

 


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