Book of the Week: High Output Management
28 Nov 2015
High Output Management is one of the books that is on the reading list for business people. The book was written by Andy Grove, the former CEO of Intel (INTC). At first I was turned off by the book since it was directed at middle managers. I have a disdain for middle managers, because they don’t really do anything and add to organizational complexity. They aren’t the ones in the trenches doing things. Then Andy mentioned “know-how managers”, who use their specialized knowledge to influence organizations. A manager’s output is the output of their organization and output of other organizations influenced by the manager. Damn it, I’m a middle manager since my output is not solely dependent on myself. Once I got over that, the book was pretty good and I could see why it is on those reading list. There are three ideas in the book.
- Output-oriented approach to management.
- Work of a business is pursued by teams, not individuals.
- Motivating individuals for peak performance.
The point is, the clichés of globalization and the information revolution have real meaning-potentially deadly meaning-for your career. The sad news is, nobody owes you a career. You own it as a sole proprietor. You must compete with millions of individuals every day, and every day you must enhance your value, hone your competitive advantage, learn, adapt, get out of the way, move from job to job, even from industry to industry if you need to do in order to start again.
Most of the ideas of the book are a result of Intel competing with Japanese in DRAM and ultimately pivoting toward CPUs since they could not compete in price or quality. This book was first published in 1983. Since the book is old, most of the pronouns for manager are male. Leverage As with the Effective Engineer, what you want to do is increase your leverage by doing things that multiple output. There are three ways to increase managerial productivity.
- Increasing the rate with which a manager performs his activity, speeding up his work.
- Increasing the leverage associated with the various managerial activities.
- Shifting the mix of a manager’s activities from those with lower to those with higher leverage.
Managerial meddling is also an example of negative leverage. This occurs when a supervisor uses his superior knowledge and experience of a subordinate’s responsibilities to assume command of a situation rather than letting the subordinate work things through himself.
Leverage can be negative if you try to micromanagement too much. You have to let your subordinate mess up. If you try to help your subordinate do something, they’ll take a more restricted view of their role and will contribute less and less in the future. Fail now for future gains. When you delegate something, you need to be able to let go and have your subordinate do it. This doesn’t be your absolved from responsibility for the output. It makes sense to check it to make sure things are on track. Saying no is also important as a manager. Meetings Meetings suck time, but they are how managers do their work. There are two types of meetings. Process-oriented meetings where knowledge is shared and information is exchanged and mission-oriented meetings, where the purpose is to produce a decision to solve a specific problem. Strategy and Tactics
As you formulate in words what you plan to do, the most abstract and general summary of those actions meaningful to you is your strategy. What you’ll do to implement the strategy is your tactics.
People confusion what is strategy and what is tactics. They vary depending on which level of the organization you are at. Management by Objectives Before Alphabet (GOOG) had objective and key results (OKRs), Intel had management by objectives (MBO), where you identify where you want to go is the objective and how you will get there are the key results. You should say no to many objectives. Peak Performance 
Things that limit output for individuals are training and motivation. Training is more straight forward than motivation. [caption id=”attachment_3757” align=”aligncenter” width=”660”]
Maslow’s Hierarchy of Needs[/caption] We can look at Maslow’s Hierachy of Needs for what motivates people. Once the lower level needs are satisfied, people move up the next level and that is what concerns them. The most motivated people are at the top at self-actualization. Money affects each of the levels, but moves things less and less as you go up. Money becomes a proxy for impact of contribution instead of being used to pay for basic needs. Task-Relevant Maturity
That variable is the task-relevant maturity (TRM) of subordinates, which is a combination of the degree of their achievement orientation and readiness to take responsibility, as well as their education, training and experience.
Everyone one of your subordinates is special in their own way, which means you need to manage them differently. This is very difficult. Task-Relevant Maturity of Subordinate | Characteristics of the Effective Management Style
—|—
low | Structured; task-oriented; tell “what,” “when,” “how”
medium | Individual-oriented; emphasis on two-way communications, support, mutual reasoning
high | Involvement by manager minimal: establishing objectives and monitoring
Performance Review One part of improving performance is providing feedback. Feedback needs to be specific, timely and related to actions and results for it to be effective. If you slap the your dog an hour after the crapped on your floor, it won’t associate that crapping on your floor is bad. Randomly giving praise is also ineffective, because it is just confusing. As a manager, you don’t see the results till later. If you’re doing a good job now, it will manifest as better results later. If your team is under performing now, it means you screwed up in some time period before now. I Quit
This is what I most dread as a manager: a subordinate, highly valued and esteemed, decides to quit. I am talking not about someone whose motives are more money and better perks at another company, but about an employee who is dedicated and loyal yet feels his work is not appreciated. You and the company don’t want to lose him, and his decision to leave reflects on you. If he feels his efforts have gone unrecognized, you have not done your job and failed as his manager.
One difficult task is dealing subordinates who want to quit. When good people want to leave, it means you fucked up. Assignments Andy says to do at least 100 points worth and you’ll be a better manager Production | Points
—|—
Identify the operations in your work most like process, assembly, and test production. | 10
For a project you are working on, identify the limiting step and map out the flow of work around it | 10
Define the proper places for the equivalents of receiving inspection, in-process inspection, and final inspection in your work. Decide whether these inspections should be monitoring steps or gate-like. Identify the conditions under which you can relax things and move to a variable inspection scheme. | 10
Identify half a dozen new indicators for your group’s output. They should measure both the quantity and quality of the output | 10
Install these new indicators as a routine in your work area, and establish their regular review in your staff meetings. | 20
What is the most important strategy (plan of action) you are pursuing now? Describe the environmental demand that prompted it and your current status or momentum. Is your strategy likely to result in a satisfactory state of affairs for you or your organization if successfully implemented? | 20
Leverage |
Conduct work simplification on your most tedious, time-consuming task. Eliminate at least 30 percent of the total number of steps involved | 10
Define your output: What are the output elements of the organization you manage and the organizations you can influence? List them in order of importance. | 10
Analyze your information- and knowledge-gathering system. Is it properly balanced among “headlines,” “newspaper articles,” and “weekly new magazines”? Is redundancy built in? | 10
Take a “tour.” Afterward, list the transactions you got involved in during its course. | 10
Create a once-a-month “excuse” for a tour. | 10
Describe how you will monitor the next project you delegate to a subordinate. What will you look for? How? How frequently? | 10
Create an inventory of projects on which you can work at discretionary times. | 10
Hold a scheduled one-on-one with each your subordinates. (Explain to them in advance what a one-on-one is about. Have them prepare for it.) | 20
Look at your calendar for the last week. Classify your activities as low-/medium-/high-leverage. Generate a plan of action to do more of the high-leverage category. (What activities will you reduce?) | 10
Forecast the demand on your time for the next week. What portion of your time is likely to be spent in meetings? Which of these are process-oriented meetings? Mission-oriented meetings? If the latter are over 25 percent of your total time, what you should do to reduce them? | 10
Define the three most important objectives for your organization for the next three months. Support them with key results. | 20
Have your subordinates do the same for themselves, after a thorough discussion of the set generated above. | 20
Generate an inventory of pending decisions you are responsible for. Take three and structure the decision-making process for them, using the six-question approach. | 10
Performance
Evaluate your own motivational state in terms of the Maslow hierarchy. Do the same for each of your subordinates. | 10
Give your subordinates a racetrack: define a set of performance indicators for each. | 20
List the various forms of task-relevant feed-back your subordinates receive. How well can they gauge their progress through them? | 10
Classify the task-relevant maturity of each of your subordinates as low, medium, or high. Evaluate the management style that would be most appropriate for each. Compare what your own style is with what it should be. | 10
Evaluate the last performance review you received and also the last set of reviews you gave your subordinates as a means of delivering task-relevant feedback. How well did the reviews do to improve performance? What was the nature of the communication process during the delivery of each? | 20
Redo one of these reviews as it should have been done. | 10
Purchase High Output Management on Amazon.com or check it out from your local library.