High Output Management

by Andrew S. Grove

The output of a manager is the output of the organizational units under his or her supervision or influence.

All you can do to improve the output of an employee is motivate and train. There is nothing else.

two ways in which a manager can impact an employee’s output: motivation and training. If you are not training, then you are basically neglecting half the job.

serve a breakfast consisting of a three-minute soft-boiled egg, buttered toast, and coffee. Your job is to prepare and deliver the three items simultaneously, each of them fresh and hot.

which of the breakfast components takes the longest to prepare?

whenever possible, you should choose in-process tests over those that destroy product.

detect and fix any problem in a production process at the lowest-value stage possible.

A manager’s output = The output of his organization + The output of the neighboring organizations under his influence

much of my day is spent acquiring information. And as you can also see, I use many ways to get it. I read standard reports and memos but also get information ad hoc. I talk to people inside and outside the company, managers at other firms or financial analysts or members of the press.

Someone adhering to the values of a corporate culture—an intelligent corporate citizen—will behave in consistent fashion under similar conditions, which means that managers don’t have to suffer the inefficiencies engendered by formal rules, procedures, and regulations that are sometimes used to get the same result.

Leverage of Managerial Activity

HIGH-LEVERAGE ACTIVITIES These can be achieved in three basic ways: • When many people are affected by one manager. • When a person’s activity or behavior over a long period of time is affected by a manager’s brief, well-focused set of words or actions. • When a large group’s work is affected by an individual supplying a unique, key piece of knowledge or information.

DELEGATION AS LEVERAGE

To gain better control of his time, the manager should use his calendar as a “production” planning tool, taking a firm initiative to schedule work that is not time-critical between those “limiting steps” in the day.

To use your calendar as a production-planning tool, you must accept responsibility for two things: 1. You should move toward the active use of your calendar, taking the initiative to fill the holes between the time-critical events with non-time-critical though necessary activities. 2. You should say “no” at the outset to work beyond your capacity to handle.

As a rule of thumb, a manager whose work is largely supervisory should have six to eight subordinates; three or four are too few and ten are too many. This range comes from a guideline that a manager should allocate about a half day per week to each of his subordinates. (Two days a week per subordinate would probably lead to meddling; an hour a week does not provide enough opportunity for monitoring.)

people can’t protest too much if they’re asked to batch questions and problems for scheduled times, instead of interrupting you whenever they want.

ideally, decision-making should occur in the middle ground, between reliance on technical knowledge on the one hand, and on the bruises one has received from having tried to implement and apply such knowledge on the other. To make a decision, if you can’t find people with both qualities, you should aim to get the best possible mix of participants available.

STEP 1—ENVIRONMENTAL DEMAND

You should evaluate the performance of your vendors. You should also evaluate the performance of other groups in the organization to which you belong.

You do this by listing your present capabilities and the projects you have in the works. As you account for them, be sure to use the same terms, or “currency,” in which you stated demand.

The first question is, What do you need to do to close the gap? The second is, What can you do to close the gap? Consider each question separately, and then decide what you actually will do, evaluating what effect your actions will have on narrowing the gap, and when. The set of actions you decide upon is your strategy.

People who plan have to have the guts, honesty, and discipline to drop projects as well as to initiate them, to shake their heads “no” as well as to smile “yes.”

“A person has to have a boss, so who is in charge here?” Could an employee in fact have two bosses? The answer was a tentative “yes,”

Free-Market Forces

It is a matter of “I want to buy the tire at the lowest price I can get” versus “I want to sell the tire at the highest price I can get.” Neither party here cares if the other goes bankrupt, nor do they pretend to.

how much an engineer is worth in a group cannot be pinned down by appealing to the free market. In fact, if we bought engineering work by the “bit,” I think we would end up spending more time trying to decide the value of each bit of contribution than the contribution itself is worth.

Cultural Values When the environment changes more rapidly than one can change rules, or when a set of circumstances is so ambiguous and unclear that a contract between the parties that attempted to cover all possibilities would be prohibitively complicated, we need another mode of control, which is based on cultural values. Its most important characteristic is that the interest of the larger group to which an individual belongs takes precedence over the interest of the individual himself.

How do we do that? One way is by articulation, by spelling out these values, objectives, and methods. The other, even more important, way is by example. If our behavior at work will be regarded as in line with the values we profess, that fosters the development of a group culture.

promotion from within tends to be the approach favored by corporations with strong corporate cultures. Bring young people in at relatively low-level, well-defined jobs with low CUA factors, and over time they will share experiences with their peers, supervisors, and subordinates and will learn the values, objectives, and methods of the organization.

if two things limit high output, a manager has two ways to tackle the issue: through training and motivation.

Once someone’s source of motivation is self-actualization, his drive to perform has no limit.

unlike other sources of motivation, which extinguish themselves after the needs are fulfilled, self-actualization continues to motivate people to ever higher levels of performance.

both competence- and achievement-oriented people spontaneously try to test the outer limits of their abilities.

In an MBO system, for example, objectives should be set at a point high enough so that even if the individual (or organization) pushes himself hard, he will still only have a fifty-fifty chance of making them. Output will tend to be greater when everybody strives for a level of achievement beyond his immediate grasp, even though trying means failure half the time. Such goal-setting is extremely important if what you want is peak performance from yourself and your subordinates.

Fear In physiological and security/safety need-dominated motivation, one fears the loss of life or limb or loss of job or liberty. Does fear have a place in the esteem or self-actualized modes? It does, but here it becomes the fear of failure.

Imagine how productive our country would become if managers could endow all work with the characteristics of competitive sports. To try to do this, we must first overcome cultural prejudice. Our society respects someone’s throwing himself into sports, but anybody who works very long hours is regarded as sick, a workaholic. So the prejudices of the majority say that sports are good and fun, but work is drudgery, a necessary evil, and in no way a source of pleasure. That makes the cliché apply: if you can’t beat them, join them—endow work with the characteristics of competitive sports. And the best way to get that spirit into the workplace is to establish some rules of the game and ways for employees to measure themselves. Eliciting peak performance means going up against something or somebody.

If your work is facilities maintenance, having your building receive the top score is a powerful source of motivation.

varying management styles are needed as task-relevant maturity varies. Specifically, when the TRM is low, the most effective approach is one that offers very precise and detailed instructions, wherein the supervisor tells the subordinate what needs to be done, when, and how: in other words, a highly structured approach. As the TRM of the subordinate grows, the most effective style moves from the structured to one more given to communication, emotional support, and encouragement, in which the manager pays more attention to the subordinate as an individual than to the task at hand. As the TRM becomes even greater, the effective management style changes again. Here the manager’s involvement should be kept to a minimum, and should primarily consist of making sure that the objectives toward which the subordinate is working are mutually agreed upon.

There is a huge distinction between a social relationship and a communicating management style, which is a caring involvement in the work of the subordinate.

The biggest problem with most reviews is that we don’t usually define what it is we want from our subordinates, and, as noted earlier, if we don’t know what we want, we are surely not going to get it.

I mean by listening: employing your entire arsenal of sensory capabilities to make certain your points are being properly interpreted by your subordinate’s brain. All the intelligence and good faith used to prepare your review will produce nothing unless this occurs. Your tool, to say it again, is total listening.

“leave yourself out.” It is very important for you to understand that the performance review is about and for your subordinate. So your own insecurities, anxieties, guilt, or whatever should be kept out of it.

The key is to recognize that your subordinate, like most people, has only a finite capacity to deal with facts, issues, and suggestions. You may possess seven truths about his performance, but if his capacity is only four, at best you’ll waste your breath on the other three. At worst you will have left him with a case of sensory overload, and he will go away without getting anything out of the review. The fact is that a person can only absorb so many messages at one time, especially when they deal with his own performance.

First, consider as many aspects of your subordinate’s performance as possible.

If you do not deal with the situation right at the first mention, you’ll confirm his feelings and the outcome is inevitable. Drop what you are doing. Sit him down and ask him why he is quitting. Let him talk—don’t argue about anything with him. Believe me, he’s rehearsed his speech countless times during more than one sleepless night.

Guess who will have learned most from the course? You. The crispness that developing it gave to your understanding of your own work is likely in itself to have made the effort extremely worthwhile.

Describe how you will monitor the next project you delegate to a subordinate. What will you look for? How? How frequently?

Generate an inventory of projects on which you can work at discretionary times.

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.