Yikes! A new employee, an experienced user of the Total Quality Management system, is lobbying hard for you to adopt TQM. Yet a new board member is shocked your organization doesn't use the Balanced Scorecard approach. Then there's that major donor, a zealot for Six Sigma (TQM on steroids), who has offered a fat check if you implement that best practice.
So how do leaders and managers differentiate between all of the management systems and tools--and pick the right one, at the right time, for the right reason?
Harvard Business Review Press has come to the rescue with this terrific new book. It's a keeper.
Authors Jeremy Hope and Steve Player write, "Many tools and practices suffer from poor practice. And having absorbed huge amounts of management time and expense, companies abandon many tools as the consultants move out and the internal project champions move on. Abortive tools and systems are a major source of management frustration, added complexity, and wasted time and cost."
They add, "Too many organizations rush into buying and implementing tools without first considering the fundamental question: which problem are we trying to solve? Framing and answering this question would avoid many expensive mistakes."
Or as Peter Drucker said, "I was taught that you make a diagnosis before you operate. And nine times out of ten, when you make the diagnosis, you don't operate."
The workplace has changed, of course, since many of the classic management tools were born. Many of these tools still work yet, say the authors, but must be applied with "empower and adapt" management models versus the old "command and control" top-down approach.
The 40 tools are categorized into five major sections: Strategic Planning, Shareholder and Customer Value, Lean Cost Management, Performance Measurement and Performance Evaluation.
But think toolbox versus novel. There's no need to read the entire book from beginning to end (I didn't). Instead, do a quick scan of the table of contents and the 40 tools, and then, to get your feet and mind wet, read three or four tool summaries. That gives you the big picture of what to expect from the book--and how to leverage the wisdom. But this caution: the short chapters are so informative, you'll have a tough time putting the book back on the shelf.
Example: Tool #38 - Recognition and Rewards. "Incentive compensation is almost without exception dysfunctional to some degree or another.
"...if an employee is unhappy because of problems with pay, status, or working conditions, he will not suddenly be motivated to greater effort and productivity by removing these problems. Motivation is intrinsic to the job. It is about responsibility, recognition, and personal development, and no amount of pay on its own will drive a person to higher levels of achievement. In one of [Frederick] Herzberg's most telling metaphors, he said that, whereas a motivated person is self-powered by a generator, an unmotivated person is powered by a battery that needs constantly recharging."
Each 10-page (or so) chapter gives a succinct paragraph definition and then a helpful and non-technical discussion of the tool. Then the authors list several bullet points to answer the questions:
--What is the performance potential of this practice?
--What actions do you need to take to maximize the potential of this practice?
For the second question, they list both "Actions to Avoid" and "Actions to Take."
In the chapter on the Mission Statements tool, the authors quote British economist John Kay who writes, "Bogus rationality is probably best described as the kind of rationality that says, this is the way we are going to make decisions in a world in which we think we know much more than we (actually) do and believe we have much more control over it than we (actually) do. It is a process which has the appearance of rationality but in the end it doesn't. It isn't rational."
Each chapter also includes a list of books and articles for further reading, and every chapter has numerous sidebar articles--most of them fascinating, memorable and quotable for your next staff or department meeting, such as:
"In a recent interview, legendary leader and former CEO of General Electric, Jack Welch, stated, `Shareholder value is the dumbest idea in the world.' He added, `Shareholder value is a result, not a strategy ... Your main constituencies are your employees, your customers and your products."
Or as Kay said, "No one will be buried with the epitaph, `He maximized shareholder value.'"
They also warn leaders not to select a performance management model that just happens to be the "flavor of the month." Think back--here or in other places you've worked--where the "flavor of the month" approach failed to enhance organizational performance.
There are more than 40 management tools, of course, but this book highlights the 40 relevant-for-today tools including: Mission Statements, Strategic Planning, Stretch Goals, Knowledge Management, Benchmarking, Sustainability, Loyalty Management, Activity-Based Costing, Key Performance Indicators, Performance Appraisals and Executive Compensation. While the book is written for leaders of for-profit enterprises, nonprofit leaders and managers will certainly find huge value in this unique toolbox.
In 1995, Harvard's John Kotter pointed out that only 30 percent of change programs succeed. So...before you embrace a new tool (and create an unnecessary revolt in the trenches), read the book as part of your due diligence process.