Dear All, In light of the recent exchanges between Edna, Jay, et al, I
thought you might fine this recent exchange between Larry Griener (USC) and
Steve Kerr (Goldman Saks) interesting.
Greiner: What about your old classic "The Folly of Rewarding A, While
Hoping for B"?
Kerr: It's funny, only 2 weeks ago, a colleague sent me an e-mail, "By the
way, you should know, I just used your article in one of my staff
meetings." It's ironic, because it was built around a false assumption,
which is that these things happen through ignorance, and here's the article
and people read it, and read it, and read it, and yet these things continue
to happen. So, my guess about causation must be wrong, because if I was
right, we should have had the capacity to fix it. There's something odd
about how people build reward systems that are divergent with the goals
they hope to attain. There's got to be something quirkier or more
deep-rooted in the human psyche, because we just keep doing it. We still
don't incentivize people enough. (pg. 347).
For those interested in reading the entire interview with Steve Kerr,
formerly Chief Learning Officer at GE, and now with Goldman Saks, here is
the citation.
Griener, Larry. 2002. Steve Kerr and his years with Jack Welch at
GE. Journal of Management Inquiry, 11, 343-350.
The Journal of Management Inquiry is published by Sage.
Regards, Kim Boal
At 03:47 PM 3/5/2003 +0700, you wrote:
>Dear all,
>
>I always hope that I am wrong, at least I do not posses enough informations,
>but please consider following:
>
>1. I always compare my student's works on forecasting with the actual data,
>and none is true (either in margin or direction)
>2. See the article that have written by Pierre Wack in 1985 (the reason why
>Shell using Scenario Planning).
>3. See also "The Fortune Sellers- The big business of buying and selling
>predictions" from William Sherden.
>4. According Hammer self, about 70% of BPR attemped failed. Or how can we
>explain the Wallace Pipe declared bankruptcy after winning Baldrige Award.
>Or Florida Power &Lights dismantled much of its TQM programs after becoming
>the first US company to win the Deming Prize,
>
>5. etc.
>
>Can we say that all the errors are only anomalies? One of my biggest
>interest area is maintenance (and I have learned with dynamics that happened
>in workfloor). But how many companies/organizations have good maintenance
>program? Few? I believe it is not because the managers are not good informed
>about TPM, RCM, etc., instead they know better than most of academicians.
>The reasons because of complexity of problems they faced (note: complexity
>means "intertwined"). Most of our world problems are now intertwined. Please
>considerd what happened in workfloor. If I am trying to improve my plant
>realibility, it means I need to build a good maintenance program (planned
>maintenance), but it means it will take many hours from production (at
>beginning of program). But if manager allowed this, it means that they will
>lost production target. Off course we can see that they must make trade
>off!, but the problem is not simple like that. Please
>consider also the role of shareholders, financial analysists (who measure
>performance as event).
>
>My point is this I believe that most of the tools (whatever the names) based
>on optimalization. To optimize we need to make assumptions. The problem is I
>think that what explained by late Thomas Kuhn, all we do (as educators &
>consultans) is normal science. "Normal science..is predicated on the
>assumption that the scientific community knows what the world is like.
>Normal science . often suppresses fundamental novelties because they are
>necessarily subversive of its basic commitments." But how about when our
>assumptions about reality are changed?
>
>
>Regards
>Enda D. Layuk Allo
>Universitas Pelita Harapan
>Karawaci, Indonesia
>
>
>Please considerd this if I am trying to do what we called PM (preventive
>maitneance) that we have to take some hours from production.
>
> > > Dear Enda Layuk Allo,
> > >
> > > I don't wish to disagree with your experience, which is probably very
> > real.
> > > However, I believe that chaos is not the best descriptor of the "world
>we
> > live
> > > in." It may be very true that the variation in our world (i.e., the
> > business
> > > world our students go into) is very large. This, however, changes the
> > > precision of the estimates and projections we make, not the expected
> > values.
> > >
> > > I see a lot of managers who do not believe that their school material
> > applies
> > > to them, or to their operations. That really means they do not see how
>it
> > > applies, and how the linkages between 'inputs' and 'outputs' control
>their
> > > lives. If our courses do not teach what those linkages are, and how to
> > find
> > > them, then we are failing our students as well as our subject.
> > >
> > > Just one small example. I have a client who is working to develop
> > improvements
> > > in their product. The production plant plays a central role in this
>work,
> > > which is mostly directed from the Development department at the home
> > office.
> > > The management bonus for the plant manager strongly urges him to keep
> > > production up, and produce parts that meet the print specification. A
> > product
> > > which is returned from the field is another part for the plant to make.
> > If the
> > > project is successful, it will increase the performance of the product,
> > and it
> > > will last longer in the field. the plant manager believes (I think)
>that
> > he
> > > already knows all he needs to know about the product, and that this
> > project may
> > > reduce his bonus.
> > >
> > > Do you suppose that his plant employees really want to do this project?
> > >
> > > See how far away the customers are? No amount of preaching by me or any
> > > professor is going to change that product, until the bonus structure is
> > > changed, or the sales really tank. Where did the bonus structure come
> > from?
> > > Who controls that?
> > >
> > > Cheers,
> > > Jay
> > >
> >
--------------------------------
Kim Boal
College of Business Administration
Texas Tech University
Lubbock, TX 79409
(806) 742-2150
KimBoal@ttu.edu