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November 24, 2008

Deming's Profound Knowledge & Taylorism

The father of Scietific Management, Frederick Winslow Taylor who's thinking was what led to an era of industrilisation in the Western nations. He was someone who, like Deming, also firmly believed in the forces of system variation and work hard to remove it from the process. His approach, later known as the scientific management invovled breaking down complex task into multiple simple tasks so that worker's effciency can be greatly improved. And Taylor proposed using various financial incentives to control the output of worker's performance. Taylor's idea was highly influential in his timer because the meaning of a job in the early 20th century was different from today. It was simply an exchange of labour for monetary reward.

When we look at what what is being discussed in class we'd realise how the makangement thinking have progressed so profoundly. In today's business environment work has a much different meaning. No longer is it a mere ouput of labour. Now we have machines and computers to help us carry out monotomous tasks which means things can be done in much greater precision at a fraction of cost than before. More importantly, work today require special talent and expertise which machines cannot imitate easily. Intellectual capability is vital to the quality of work.

So like Taylor, Deming also teach us to eliminate the sources of variation in the system. But different from Taylor, Deming shows us a different approach that is the appreciation for the system. Understand that there are inherent variations that are despite our best effort and intention we can never truly get rid of. What then is the appreciation for the system? Perhaps instead of bogging down on the details of the actual process, we would look at the whole picture. Okay, what exactly is this whole picture? A simple way to explains this is that there are other factors outside the process itself which can influence the outcome. For example, worker's morale, the influence of culture, the worker's job satisfaction and etc just to name a few. Such factors , as we would all agree are all pretty important for the quality of outcomes but are nevertheless not captured by financial incentives alone. Psychology , one of Deming's four profound knowledge is a nice illustration of this idea.

To me it seems like what we have been learning in CBE (EFQM, Deming, Baldrige, TQM in lesser extent)has all pretty much revolved around same set of core fundamental concepts. That is, management is no longer a simple one way process where the manager can quite easily control outcome with various incentive schemes. Workers today are just as intelligent and capable as their bosses. To release their fullest potential and direct them to work, manager has to be able to understand their workers as human beings, know their needs, remove the barriers that inhibit their ability to perform. This I think, are the fundamental management concepts underlying everything we've studying until this day.



November 23, 2008

Deming and the learning organisation

One thing you notice about Deming is that his style of writing is very different. Sometimes he would write a short sentence that would just turn what you used to believe up side down. I would like to share my thoughts on one of Deming's greatest contribution to management thinking ('greatest' according to Delavigne 1994 ...)

"Every system has variation: hence, the information needed to create optimum systems is unknown and unknowable." (Deming's quote adapted from Delavigne 1994; pp47)

When we read something as abstract as that, it is worthwhile thinking about what it means exactly...

Why is it unknown?

Because all systems contains variation, no matter how sophisticated the system is, sources of variation will always exist and that prevent us from producing an outcome that is exactly identical with the last outcome.

(Hmm... fair comment? maybe for actions controlled by man we can expect significant amount of variation. But with learning and practice this variation can be reduced significantly. Further the advances in machinery and automation has given much greater precision to production process and outcome which makes this comment less convincing then it was before recent technological advances took place)

So all we can possibly do, in a system under statistical control, is to change the system somehow so the range of variationis reduced, albeit never truyly eliminated.

Why is it unknowable?

The optimum system is a goal by which we gear all our effort to achieve. We do not know how to get there nor do we know it when we get there. All we essentially know, is that we need to constantly improve our system if we want to become closer to this goal.

This creates a need for a learning orgnisation since a learning organisation by definition is:

"the process of improving actions through better knowledge and understanding" (Fiol, C.M 1985; adapted from CBE Group 1 presentation)

THERE! I established the link between Deming and the learning organisation XD Hope you find this useful ...


Cost of bad quality

Deming's 14 points of management seems to be designed to improve the quality of product or services in the modern industry, obvious enough. But I think it's worthwhile to relate his philosophies to the real world and think whether they will really work.

In the #4 point "End of the practice of awarding businesses on the basis of price tag alone", he writes "Price has no meaning without a measure if the quality being purchased. Without adequate measures of quality, business drifts to the lowest bidder, low quality and high cost being the inevitable result" Out of the crisis p32. As I read this, I am just thinking how crucial is quality in our purchasing decisions, and compare that to the cost of the product/service we are buying. I believe both are very important but very often we consider cost before quality.

Some cynics would simply says 'this is the way the world works, people go where they can get the best deals'. True, and many businesses have operated and suceeded based on this mentality. But  I suppose the point Deming is getting at is that too much has been placed on the price tag. And that we would go to supermarket to buy the cheapest milk, call our family on the cheapest network.What we often do no realise is the trouble we end up getting into. It may well be the milk we buy was not processed properly and we end up in hospital, or the network we use never connects and we are stuck in a 12 month contract. Either case our decisions have costed us much more than what we initially anticipated. A hard lesson learned?

Perhaps instead of blaming ourselves for being cheap or the sneaky vendors for their deceit, we can ask oursleves whether our behaviors have helped to bring about this consequence. In Deming's words " The price tag is still too easy to read, but an understanding of quality requires education" p33.  Is the customer to blame? Perhaps not, it is the businesses themselves who need to communicate product superiority and charge a fair tariff. Moreoever, we ourselves needs to be more educated to understand quality is not just something that businesses has to achieve, moreover it is something we have to support and believe.


October 09, 2008

Most expensive book ever bought !

If the value of a book is determined by the following formulae;

                   Cost of the book

Value = -----------------------------------

                  Number of book pages

Then I just purchased the most valuable book in my collection

At 45 pounds and 90 pages, the EFQM twin set has a value of 50p / page !!

================================================================================

Seriously though, I am begining to see this as good investment...At the first glance, it is just a book with some meaningless boxes. But the real gem of this EFQM is in the inter-relationship between each boxes. Like for the Measurement of Result (II) project, if I imagine myself as a company manager in a automobile part supplier company, supplying parts to Toyota. With the matrix on page 10 , I can quickly find that partnership is related to leadership 1C, Policy 2A & 2C, Partnership 4A, and Process 5C and 5E, and Result 9A & 9B, flick to relevant pages and find more information about how to manage that. It's like an encyclopedia for business success. Haha... maybe I am exagerating a little bit XD


October 08, 2008

Class blogging

I was scrolling through my teamate's blogs and found links to everyonelse's blogs. To be honest I am totally amazed by the quantity and quality of blogs that are being created by my classmates. Everyone is very energised about our tasks and the uncertainty (in a good way) that lie ahead of us. Thankfully, our course leader Paul Robert has designed such a brilliant learning environment where all of us is able to learn from each other's experiences. It feels wonderful when you're trying to learn something and see that same topic being discussed by another member who may have looked at it from totally different perspective.

This is going to be a wonderful year!



Traditional Performance Measurement

TPM- Traditional Performance Measurement

BSC- Balance ScoreCard

What is TPM, to me it is simply a comparison between  Present (NOW) and the Past (BEFORE) or an arbitrary projected figure. This is known as a paired comparison. Why is it that we need to compare? Well, like everything we do, we would like to compare it with somone or something else to see if we are doing better or worse. It may be our exam result, we would compare this year's grades with previous's. We want to see if we improved or became worse at something. As production or any services is concerned, a comparison between now and the past can give indication whether the Curent Practices fares better or worse than the previous ones. This allows manger to decide whether a new technology is functioning well, whether a new employee is performing as expected, or on the company level, did the revenue increase as we thought  it would, and if not , why not? This links in with the Deming's idea of natural variation and the search for a special cause (Theory of Profound Knowledge (Deming, 1992)). I remeber when I worked in retail, industry, the store manager would check our daily, weekly and monthy sales volume and determine if we met the target or not. Usually the target is an arbitrary figure . This figure is usually adjusted depending on season if it's a yearly target (summer people would do more shopping than in winter) , on days of the week if it's a weekly target (apparently it used to be the case that shops are opened for longer on Wedneday so our target for Wednesday is usually higher than othe weekdays, but then the Wednesday shop open hours became the same as other weekday but our target for Wednesday still remained higher. I used to wonder why no-body changed it since we never meet our target on Wednesdays!!).

Obvious advantage with the TPM approach is that it is simple and straightforward. It can be done quickly and any period (week, month, year) of performance can be evaluated quickly be simply comparing it to another period of interest.

Some disavantages with this approach
1. As I implied in my little story as a shop keeper =) TPM after a while may become just a procedure without any meaning to go along with the numbers.

Some of the other disavantages suggested by Paul are
1. Paired comparison provides no context to the management data (i.e. historical data, operational data, human resource data e.t.c) , we do not know whether an observation is simply a natural variation or a special case caused by other things (since TPM does not measure other thing, we have no way of knowing what kind of things are those "other things").
2. Overemphasis on financial data - a point I explained in the above
3. laggin measurement- this part I am not sure exactly... something about measuring what is the the past but not the future...

Given the short-comings of the TPM approach, one can understand how other approaches such as the BSC complement and improve the management of performance measurements . Mainly the idea is that business decisions cannot be based on figures and numbers alone, the amount of output or size of revenue does not provide a complete picture of organisational performance. Certainly, the shareholders and investors may be pleased that their stock prices are increasing, but it may be a result of many possible causes (i.e. booming economy, focus on short-term gains, sell-off of a potentially profitable business unit), this does not mean the business will continue to grow into the future. On the other hand, if management has Knowledge of the four BSC perspectives (customer needs, internal process, learning capability, and fincancial data) , it can predict the future trends in consumer tastes and allocate resources to add value of its product and services to the consumers accordingly.

As I am writing up this entry I am reminded by a SONY personal digital assistant (PDA) that I bought years ago. At the time Sony was in the business of making PDA to cater the needs of businessman, students, and anybody who has a keen interest in digital portable diary. It was one of the market leaders at the time, making PDAs that had more functionality than its competitors. However, as the technology progressed, people are begining to integrate various technology products into one simple solution,  for example, mobile phones with in-built camera. At that time , some people speculated the inevitable integration of mobile phone, digital camera, and PDA's but others were more reserved about that speculation because of technological barriers. Some companies were able to see the shift in consumer trend and began investing in the 3 in 1 solution. Simplicity, it seemed, was going to be the next idea. Sony however, continued making PDAs that comes with more and more functionality and lesser and lesser user friendly. Eventually, Sony stopped its PDA production due to dwindling sales. I can still remember seeing a picture of the final and last generation of SONY PDA which looked a a huge rectangle metal box with lots of little keyboard button. the review I read championed the functionalities but rated poorly for it's ease of use and staggering ticket price.



October 06, 2008

Leadership? still much to learn

After today's group meeting my feelings were mixed, confused, and feel quite unsure about myself. I welcome our new member Apollo, seem like a nice guy, looks like we will get along just fine.

We have agreed each of us will get one chance to lead a mini project, but I don't know how that will pan out. Since we won't necessarily will have a meeting about every topic. Perhaps it is best to roate leader on the basis of meetings.

Naturally , I have always felt the urge to stand out the crowd and make a difference. At the same time,I worry about wrting something which I still have little idea about. So to save you the boredom of lengthy blog, i will cut things short this time

Back home, I have been invovled in numerous group situations, most of the times group resolved into some sort of consensus decisions making which is nice, no one is hurt, no hard feelings, but it was inefficient, sometimes it seems like people would just follow the dominant opinion.

Being a part of MBE and living in a new environment, I feel I must make some changes to my old habits. To take more risks, be more up front, stand my grounds, and tackles confrontations with grace and respect.

So today ... was our first group meeting

Having been involved in several group project prior to Warwick, I understood the importance of preparation. Valuable time can be easily wasted away in a group without clear objectives. So last night I spent sometime reading Paul's materials to make sense of our assessment, then brained-stormed some ideas on team work including some key points about leaders, thinking this would make today's meeting go smooth-as. 

To my surprise, the meeting was far from smooth. Admittedly I am not always comfortable with confrontation. As the group leader I felt I was able to observe the group dynamics yet I struggled to adapt to it. For example, I went into direct confrontation with my group memebers. Mei and Ally especially disagreed with me that leader have the power to delegate tasks. My understanding differs radically with Ally and Mei. To me, leader should have a reasonable amount of power which comes inherently with the position. So this means even if members do not agree with what the leader says, part of being a follower, and in a group is to listen to their leader.  I mean, don't get me wrong, different voices are welcomed and I'd be happy to listen to them, but still at the end of the day without a leader to make a decision , people with different opinions may find it impossible to cooperate, and hence the group progress is hindered.

Personally I feel leader is more than a manager, it is someone who concern him/her self with directions, strategies, and objectives. To Mei and Ally, the idea of leader is someone who manages things. For example, we disagreed strongly on whether the group leader should also be the note-taker, time keeper. Just a minor thing and maybe it was simply a misundertanding of the meaning of words but the tension was a little much, for me. 

Well, even with the ups and downs, I feel today's session was more a success than anything else, we settled on some housekeeping issues, made everyone aware of their obligation to the group, and ensured the meeting was completed just over 1 hour.

I am thankful for a such active and dynamic group. Toon is excellent, she brings with her great consulting experience from the industry. Her explanation of how groups actually work in workplace settings were immensely valuable. Gilbert is also as great, thankfully he corrected me when I tried to give a elaborate explanation about sampling bias. Ally and Mei each have their own opinion and experience to contribute. I'm still yet to learn a bit more about Apollo though but I believe he too is an important member of this group.

See you guys tomorrow



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