Forrest Breyfogle III Talks About Wisdom On The Green

A Harvard Business Review article “Why Few Executives are Skillful Managers” made the following points: “despite the billions of dollars, euros, and yen invested in coaching and management development, remarkably few executives can be regarded as skillful managers.” It’s my guess that the majority of managers with responsibility for large teams and significant businesses either do not possess the requisite skills of a manager — or they just don’t put them into practice. Why? There are three main reasons. Firstly, time constraints and day to day pressure to deliver instant results make it almost impossible for execs to ponder, think through, and apply their new abilities. Second, budget constraints can result in a lack of support and follow-through on the best intentions. Finally, behavioral change is difficult — it’s all too easy for a development plan to slip to the bottom of the to-do list.” The article suggested the following development areas: delegation, management distance, visibility, work-life balance, and continuous learning and reflection.

Some other thoughts …
I do not disagree with the issue of executives making skillful managers; however, I have some other thoughts on what should be done to address the problem. I suggest that Executives would be much improved if they were to operate within a well defined strategy that leads to the 3 Rs of business; i.e., everyone doing the Right things, and doing them Right, at the Right time. This management system needs to be different than the establishment of somewhat arbitrary goals throughout the organization for departments without a structure plan for determining what will be done differently to determine how the goals are to be met. Furthermore, this system of management needs to consider the evolution of business strategies that lead to specific behaviors that are congruant with the focused financial needs of the organization.

Executives operate their organizations using strategic planning, scorecards and business improvement systems that can lead to decisions that are wrong for the company. These issues with resolution are described in “The Elephant in the Room: Corporate Performance Management Issues and its Reinvention, Going Beyond Lean Six Sigma and the Balanced Scorecard”.

With the linked described system, Executives would now have a structured framework for them to operate within that cannot be gamed. Lean Six Sigma consulting and/or coaching would provide more of a structure for what they should be doing to be successful operating their businesses within this infrastructure.

For more information you can also visit http://www.ieeblackbelt.com.

Fewer than 50% of businesses survive beyond five years. Visit government census or Depart of Industry web sites and if you look at the detail you will see irrefutable evidence

The industry experts common reason for death is the unfortunate ones just ran out of cash. This lack of detail is of no value and so I decided to find those directly and indirectly connected with failed businesses to see if I could uncover the details, establish any consistent reasons for failure and present them on the web in the hope that my discoveries would help others avoid a similar fate. I discovered eight common reasons for business death. Here are three of them:

No Vision, mission or strategy

“If you haven’t a clue where you are headed then how are you going to get there?” You have to have a clear picture of what you want to achieve and how the environment will be for your business if you achieve it. To achieve anything you it is essential to have a strategy. Strategy is very similar to a road map it shows you how to get to your destination. It’s a structured list of actions. To make a strategy work you have to create a business plan that not only contains the key actions and milestones but can used to measure business performance against. A key tool for monitoring business perfomance is the sales forecast.

Lack of a system for marketing or sales

Marketing is about identifying markets and trying out strategies to position your proposition in the minds of prospects and moving them into your sales channel. Sales is about engaging the prospect and getting them to buy your product or service. Marketing is a process of measuring and improvement of the ways you employ to acquire prospects. Sales is the process of creating leads, forecasting sales and closing business. In successful companies a good marketing and sales system is often supported by a well designed sales forecasting software system. Systems like these enable you to track and measure the activity in the sales and marketing processes. Results arederived from reports created by the software which can then be used to compare what you predicted would happen versus the real outcomes. The point I am making is what gets measured gets improved or discontinued. This is the critical formula for success.

Lack a system to get sales from their captive customer list

There is a common phrase that eighty percent of your sales should come from twenty percent of your customers. Your focus is to achieve or exceed this number. Customers that have already bought from you are easier and more cost effective to sell to than prospects that haven’t. A combination of decent web based crm software and sales forecasting software will give you the information of historical activity and enable you to find opportunities in your current customer base.

Organizations can have many problems because they are measuring the wrong things, which can lead to unbeneficial or detrimental behaviors.  Improvements are needed in many organization’s measurement and improvement systems.  Red-yellow-green balanced scorecard measures, should be avoided because they can lead to firefighting measures that do not benefit the overall enterprise.

Data needs to be from a stable process or “in control” process to create a valid process capability statement.  Let’s also strive to have a sampling process so that if more than one person reviews the same process their conclusions should be considered similar even if the process is considered “in control” or not.  With this statement, reference is made to how they sample from the process, not a chance occurrence.  “Predictable” is often a better term than “in control”. 

It is better to use ppm as a response for process capability and process performance indices, rather than Cp, Cpk, Pp, and Ppk, which can be very confusing and deceiving.  A better practice is to use a probability plot to describe process capability/performance, since a probability plot offers more output flexibility and data understanding potential than process capability analyses that also provided Cp, Cpk, Pp, and Ppk outputs.  When make a process capability/performance metric statement probability plots are also very useful, even though no specification exists.  Please note that probability plotting is not the most critical issue relating to the creation of a no-nonsense balanced scorecard measures system that keeps organizations out of the firefighting business.

With IEE (or Integrated Enterprise Excellence) measurement system when implemented from the top down can help you achieve your corporate objectives.  In the IEE methodology, there can become a measurement “pull” for the initiation of projects when a predictive metric does not produce a desirable improvement for the enterprise as a whole.  To make this happen, a measurement system is most be developed which is independent from how someone designed a sample collection system.

The primary purpose of a 30,000-foot-level control charting should be an overall view of customer experience. Assuming that there is consensus with this position, a couple questions need to be asked to determine if there is agreement as to what should be considered as a potential common cause and special cause input variable source in a 30,000-foot-level control chart.  Compare this to the timely identification of a problem using a control chart to halt a manufacturing line to fix the problem because of a signal that is out of control.

Let’s discuss a typical situation where process raw material is changed day by day.  Add to that you must consider that some raw material characteristic affects the output of the process.  Would raw material be considered as a potential common cause variability source or should it be considered a special cause variability source?

Most will agree that raw material should be considered a source of common cause variability.  If there is agreement on this and there is also agreement that control charting should provide information consistent with what we believe with respect to special and common cause identification, we will not use x-bar and R charts.  

Why is this?  With our current belief system, the fundamentals behind the creation of an X-bar and R chart can seem inconsistent. X-bar and R chart control limits are only a function of within subgroup variability. For x-bar and R control chart limits, variability between subgroups has no affect.   The control limit calculations of an individuals control chart provides control limits that are a function of the variability between subgroups.  The individuals control chart upper and lower control chart limits would consider the variability between raw material lots; however, this would not occur in an x-bar and R chart.

One could use x-bar and R charts to calculate process capability in statistical programs such as Minitab; however, this is not consistent with our belief system.  X-bar and R charts can force an enterprise into a lot of damage control.   X-bar and R charts are not used when making an IEE 30,000-foot-level assessment.

It can be tough for some to accept that the taught x-bar and R chart in a basic statistics class has problems.  Several 30,000-foot-level articles can be found in the “On-line Resource Library” link at www.SmarterSolutions.com, which provides more details and shows an example, not only for a continuous response output but other outputs as well.

The volume, Integrated Enterprise Excellence Volume III – Improvement Project Execution: A Management and Black Belt Guide for Going beyond Lean Six Sigma and the Balanced Scorecard describes on how to create 30,000-foot-level charts for various situations and much more. You can also visit www.ieeblackbelt.com for more information.