When you find a snake in your yard, kill it


When you find a snake in your yard, kill it.

He’s just a numbers guy.


In the business of managing business there is one skill that should be prized as much as an M.B.A. or any other certification. That is the ability to appropriately plot data. Here is a link to a blog discussing the underutilized orbit chart.

Orbit charts, and why you should use them.

But to appropriately measure and plot the data one needs to be a bit of a numbers guy. One of the slurs received as a management consultant is “he’s a numbers guy.” It’s true. I am a numbers guy. What is missed in the epithet many times is the speaker’s concession, “I’m afraid of what the numbers reveal.”

Numbers are data points and reflect aggregated decisions/non-decisions. When plotted appropriately, the data points may tell a story. That story may be directly correlated to the quality of the decisions/non-decisions by the decision makers. For example in the Orbit Chart blog is a chart showing the cyclical tradeoff between productivity and quality.

Recently I had the opportunity to work with a manufacturer who overcame a bottleneck a few years ago by investing in the highest output machine of its kind. To no surprise, the bottleneck shifted as sales ballooned. But because everyone was so enamored with the new toy, no one was watching for the shift. Result, on time delivery dropped below 50%, late delivery penalties of 5% per day increased, shipping costs soared to expedite late deliveries, and customers grew unhappy with the experience. The operating profit before the hits was 4%. The company was near extinction, which meant all jobs there were at risk.

So here I come on the scene with a project charter to source and implement corrective actions on the fountainhead of undesirable effects (UDE’s). Using intuition, interviews, and frameworks designed to uncover the UDE’s, my sights became set on a workgroup. This began the quest for data to validate or invalidate the initial hypothesis. In this case the initial hypothesis was validated.

This particular workgroup had for years been neglected/ignored by senior management and mostly middle management. All of a sudden the workgroup finds itself in a fishbowl. They are then being measured in some critical areas. Middle management is now focusing on the pace of this workgroup to set the pace for the front end of the business and learning how to increase the output of the troubled workgroup.

Senior management was concerned with feedback that ‘he’s just a numbers guy.” Would the efforts fail with such resistance? The fact we were having this conversation told me that senior management had a problem with using data to make better decisions. And I had better get them on-board or the whole project would be doomed. My conversation with them went along the lines of

1) the story of your performance is not good

2) not good as measured by the numbers you determined were critical

3) that is the current story

4) want to tell a different story?

5) we’ll have to achieve different results

6) results as measured by the same or more relevant data

7) so let’s use the numbers as milestones to reflect the quality of decisions along the journey and not be afraid

Ensuring senior management was on-board was critical to success. So far the results are promising. Output is increasing from the workgroup, on time deliveries increased dramatically, expedited shipping costs have declined, and no one has left who was not invited by senior management to leave.

 

Market Risk 10.22.12


This is a model for measuring Market Risk in the overall equities markets. There are the short term indicators of which a simple average is calculated and a simple average of long term indicators. The short term are plotted on the horizontal axis and the long term indicators are plotted on the vertical axis. The goal is to identify the levels of risk within the market at a point in time.

Risk management is not a straightforward proposition in the markets. This will only give the reader an idea of the current level. It is important to note the 2008 beating in the markets came while this was in the middle box, albeit while trending from higher levels of risk the year before.

I welcome any feedback or suggestions.

Please consult your financial advisor before taking any action. This is not intended to be a substitute for financial planning, wealth management, or any other financial advice.

 

 

Relationships and Shifting Contexts


One of the benefits of my work is the opportunity to work with some outstanding people throughout the country. And as diverse as any population segment in America is, there are some common, not universal, traits. One of those is small and medium sized enterprise operators (SME’s) tend to make decisions based on more social reasons than business reasons.

A client is currently unraveling some decisions made over the years and as we are working through these, a distinct pattern began to emerge. The client had business and social relationships who were shifting the context of the interactions and the client was not quickly “putting on the business hat” to make better decisions.

This is a simple box graph illustrating the Relationships and the context of the interactions. Business relationships with business oriented interactions as well as the social/social interactions are straightforward. Where I have seen missteps is where a social relationship begins to shift the interaction to a business context and before the SME realizes it, they are making a decision based on the social relationship and not necessarily the best business decision.

I have been using this with those clients simply to illustrate to them the segments and provide “tools” for them to use when they find themselves in a shift.

Intermediate Objectives Map


Reblogging Bob Sproull’s take on Intermediate Objectives Map

 

A Link to NOVACES

Posted: 01 Sep 2012 03:01 AM PDT

Today I want to give you a link to my company’s (NOVACES) blog postings where I also contribute.  The link below is a link to a posting I wrote about a different way to use the Intermediate Objectives Map.  I use this when I don’t have time to do a full Thinking Process analysis.

http://novaces.com/blog/constraints-management/intermediate-objectives-map-%e2%80%93-a-great-planning-and-execution-tool

Bob Sproull

Geeks to face Geniuses


On Tuesday there was a need to acquire a flash drive at work. I asked where the nearest store was carrying these items. Best Buy. So I quickly drove there.

I was greeted by someone who was standing at a station facing into the store. He said something like welcome to Best Buy can I help you? This was awkward because he was not facing us as we were walking in to the store. After selecting a drive, I wanted to hurry to the checkout. I saw a desk where there were cash registers and employees. So I stood there. And I stood there. The reason, there were three other customers who were engaged in conversation with those employees. It began to become clear to me, this was more than a scan swipe scurry scenario.

Looking closer, I see Geek Squad logos. Ah, I must be at the customer service area where they do returns or fix the product or warranty stuff. Then slightly behind me I notice about 5 checkout lines with idle checkout employees.

Having thought nothing more of it, I read this WSJ article this morning. http://online.wsj.com/article/SB10001424052702303684004577507033027128596.html?mod=WSJ_article_MoreIn_Business. Aha. Now it all makes sense.

Best Buy is now going to offer service and support. The article suggests they are going to emulate the Apple experience at it’s Genius Bar. According to data from ACSI, the more complex features a user utilizes on a smartphone, the less satisfied they are. http://www.acsimatters.com/. And Best Buy is in a competitive market position to take advantage of increasing customer experience.

Additional considerations for Best Buy on improving the customer experience.

1. It is considered polite to be facing customers when they arrive. Apple stores don’t have stations in the front of the stores. There are usually an employee or two standing at the front door to ask if they can help.

2. If I were on my own looking at say iPads, an Apple employee would approach me and  offer answer any questions I may have on that product.

3. In the event I need someone to help me with a product, or I need a repair, I can go online to the Apple Store and book an appointment with the Genius Bar.

4. Advertise, Promote and Distinguish. Make every customer and potential customer know there is help with that product or device at the store.

Best Buy reported 1103 stores in the U.S. in their latest financial report. Apple has 257 listed in the U.S. on their web page. Best Buy has the advantage in number of stores and the potential to offer the broadest scope increasing customer satisfaction. And where customer satisfaction is increased, profits follow.

 

 


Where can Avatars replace us humans? Tellers, agents, drive-throughs, box offices, medical receptionists, cashiers, end of the aisle kiosks, restaurants, commoditized services such as car insurance.


Here are some great infographics on the usage of social media by the Fortune 500. With technology being the great equalizer in branding, this opens the door for the SME’s (small and medium sized enterprises)!!

Strategy Plan One

Strategy Plan One

May 22, 2012 

Social Media Statistics

How well are Fortune 500 companies doing in the social media world?  Here’s some more social media statistics on Fortune 500 companies through this Infographic by Go-Gulf web technologies.

Highlights of Fortune 500 companies and integration into social media:

  • Only 23% have corporate blogs, compared to 37% of Inc 500 companies 
  • Majority of blogs centered on consumer goods (clothing, retail, electronics, etc.)
  • 62% have a Twitter account, with Google at the top with 4.8 Million followers
  • 58% have a Facebook page, with Coca-Cola leading with ~ 42 Million likes

social media statistics - Fortune 500 companies

Other blogs on social media you may be interested in:

Strategy Plan One

http://strategyplanone.com

Business information, resources and tips for the entrepreneur

© 2012 Strategy Plan…

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Apple sells more Smartphones, but who sells more cell phones?


Image

http://www.statista.com/chartoftheday/media/

What’s up with that Yellow Dot?


Prahalad and Hamel wrote about monkeys in a cage undergoing operant conditioning as a lesson to the development of corporate culture in the book Competing for the Future. Researching this on the internet for factual basis led to several articles and blogs denying the events ever took place. It is a fascinating story and if the reader has not read it, it is worth a few minutes. Whether the Prahalad and Hamel monkey experiment is indeed factual, I do not know. But I have seen this played out in real time on consulting engagements with clients.

There is a particular occurrence to note. One day while touring one of the plants with a new client. He was proudly showing me the machinery, the dedication to continuous improvement processes and really showing off his people. Bragging wherever he could. And let me say, this client had a lot to brag about. This plant was one of the most productive plants, with engaged employees. I was encouraged to stop and ask randomly about important financial results of the company and what they meant. The employees seeing the pride in the client were only too happy to oblige in this play.

While reviewing one of the production lines I stopped and asked an employee who was placing yellow dots on completed units “What is the purpose of placing those yellow dots on the units?” He didn’t know. His response was “When I started here three years ago, I was trained to place them there.” The client sensing the visiting consultant had stumbled on one of those precious veins of opportunity quickly jumped in. He asked “Where do you get these dots?” “From the shift supervisor.” Good, the shift supervisor was someone we were going to see soon. Meanwhile, we asked downstream in packaging and shipping, “What is the purpose of those yellow dots?” No one seemed to know. What was more, the yellow dots did not serve a purpose or contribute to meaning of anything to anyone. So off we went to the shift supervisor. Hopefully going upstream back to the headwaters of the issue we would find answers.

The shift supervisor did not know the purpose of the dots. But added that when he was trained here seven years ago, it was pressed on him to make certain the front office supplied him with enough of them. He even commented that the front office held on to them as if they were vital raw material inventory. The plant manager did not know the purpose of those dots. As you can imagine now we had a retinue of employees all asking the question “What’s up with those dots?” Back to the shift supervisor “Who supplies those dots to you?” It turned out one of the front office employees was the supplier.

We all walked to her station all curious looking for the source of those dots. She, sensing possibly a village revolt was nervously answering “I don’t know how the dots get used, or what their purpose is.” She only knew from the lady who trained her in her role twelve years ago that she better never run out of those yellow dots. So each week she would open this large metal cabinet drawer dedicated to warehousing these seemingly important yellow dots and count them. Further, if they ran low, her mission was to run out to the office supply depot and purchase more on her lunch break. Sometimes as the plant seemed to use up some colors more than others, she found herself in fire drill emergencies rushing out to resupply dwindling supplies of dots. She commented about the constant struggle with the plant consuming the dots without her knowledge and the vital stock running low jeopardizing the entire enterprise.

By now we are all laughing with tears running! Some of us had trouble talking and breathing! She was aghast and didn’t appreciate this, I’m sure. It was after all an important duty for her. The retinue of the yellow dot curious were otherwise entertained with the idea that for a minimum of twelve years the company had dedicated resources to processes that no one can remember how they were begun nor why. Further, no one ever questioned “why are we doing this?”

The client walked around the rest of the day with a dot on his glasses hoping others would ask “What’s up with the dot?” His response “YOU TELL ME WHAT”S UP WITH THE DOTS?”

So, I do not know if the monkey cage experiment is true, but I have seen what Prahalad and Hamel were referring to the development of corporate culture.