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Posts selected fromManagement Blog - Engineering Blog - Investing Blog and other blogs

• Warren Buffett’s 2005 Shareholder Letter

  Too often, executive compensation in the U.S. is ridiculously out of line with performance. That won’t change, moreover, because the deck is stacked against investors when it comes to the CEO’s pay. The upshot is that a mediocre-or-worse CEO – aided by his handpicked VP of human relations and a consultant from the ever-accommodating firm of Ratchet, Ratchet and Bingo – all too often receives gobs of money from an ill-designed compensation arrangement.

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• Saving for Retirement

  Saving for retirement is not complicated, it is just a matter of priorities.

  ...

  Savings for retirement is difficult mainly because of our trouble planning for the long term, it is not at all a complex problem. The fable of the ant and the grasshopper illustrates this point very simply and it is really that simple. ...

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• Saving for Retirement

  Saving for retirement is not complicated, it is just a matter of priorities. Most people care more about a Startbucks coffee each day (or season tickets, or new shoes, or a new car every couple of years or…) today than saving money for retirement. In a capitalist society we believe in letting people make their economic choices. The choices most of us make (in the USA) lead to the results above (few saving enough for retirement).

  Savings for retirement is difficult mainly because of our trouble planning for the long term, it is not at all a complex problem. The fable of the ant and the grasshopper illustrates this point very simply and it is really that simple. People need to do a better job of applying the lessons from that story to their retirement savings.

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• Cease Mass Inspection for Quality

  Deming’s point 3 is "Cease dependence on inspection to achieve quality. Eliminate the need for inspection on a mass basis by building quality into the product in the first place.

  Deming believed in improving the process, and doing so using process measures (which often may involve sampling) to guide improvement efforts. He did not believe in using inspection to select out the bad products, which is what inspection largely was before Deming...

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• Cease Mass Inspection for Quality

  Deming believed in improving the process, and doing so using process measures (which often may involve sampling) to guide improvement efforts. He did not believe in using inspection to select out the bad products, which is what inspection largely was before Deming.

  More on Deming’s thought on Inspection...

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• Not Lean Retailing

  Nothing is wrong with major decisions being made by the leaders but the article leaves the impression many non-major decisions are cetralized too. That is a problem for those who believe in management improvement ideas including lean thinking.

  ...

  Again moving away from good lean management ideas such as: longevity of management, focus on value of employees rather than cost of employees…

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• Theory in Practice

  Knowledge is built upon theory… Rational prediction requires theory and builds knowledge through systematic revision and extention of theory based on comparison of prediction with observation.

  W. Edwards Deming, page 102, The New Economics

   

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• Is Made in the USA Back In Vogue? (2006)

  This example provides more evidence of the benefits of "lean manufacturing," though it seems they are getting only a few benefits (reduction of waste, faster resupply of "hot items") and they may well not know about <a href="http://curiouscat.com/management/leanthinking.cfm">lean thinking</a>.  By studying and applying lean ideas they should be able to reduce the 45 day turn-around time.  Perhaps they should read the Fashion Incubator blog...

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• Innovation at Toyota

  While targets and goals can distract from improvement some guidance is useful. If the desire to is have incremental improvement one strategy may be reasonable but if the desire is to aim for huge improvement another strategy is likely required...

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• Innovation at Toyota in Developing the Prius

  By the end of 1993 the development team had determined that higher oil prices and a growing middle class around the world would require the new car to be both roomy and fuel-efficient. Other than that, they were given no guidance. “I was trying to come up with the future direction of the company,” says Watanabe, who headed corporate planning at the time. “I didn’t have a very specific idea about the vehicle.”

  Investing in innovation is risky. If successful, the benefits can build a competitive advantage that is difficult for others to eliminate. However, others will try and if you fail to execute as well in the future those benefits can disappear quickly. Toyota shows few signs of letting others catch up though.

   

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• Global Manufacturing Data by Country from 2001 to 2004

  This data shows the United States manufacturing economy is continuing to grow and is solidly the largest manufacturing economy: which contradicts what many believe. It is true manufacturing jobs are decreasing in the United States and worldwide – China is losing far more manufacturing jobs than the USA.

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• Quality Customer Focus

  Customers expectations change over time. Often what was once enough to delight a customer (remote control for a TV) becomes expected. Once a feature is expected the organization gets no credit for providing it they only risk a negative reaction if they fail to provide it.

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• Quality Customer Focus

  Kano model of Customer Satisfaction: Kano saw three types of customer satisfaction: required (basic quality also threshold requirements), more is better (performance quality) and delighter (excitement quality).

  Customers expectations change over time. Often what was once enough to delight a customer (remote control for a TV) becomes expected...

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• John Simpson

  This is the best I can do to create my Simpson self. Until I have a guest appearance on the show, I guess this will have to do.

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• Visible Data

  Take the time to find the important measures and then don’t keep data hidden in some drawer or computer file out of people’s view and therefore out of mind. Post the important data for everyone to see. Review the data as changes are made and see that the changes had the desired result. Update the measures when appropriate...

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