High Output Management

by Andrew S. Grove

one explanation advanced for their ability to act quickly and decisively was the way Japanese offices were set up. In a Japanese office, a manager and his subordinates all sit around a big long table. People work on their own assignments but when they need to exchange information, everybody they work with sits within speaking distance, right around the same table. So information is exchanged in minutes and everybody can be reached with the same effort. As a result, because of the ease with which Japanese office workers communicate, they have, in fact, been slow to embrace electronic mail.

Middle managers are the muscle and bone of every sizable organization, no matter how loose or “flattened” the hierarchy, but they are largely ignored despite their immense importance to our society and economy.

Again, as a manager in such a workplace, you need to develop a higher tolerance for disorder.

three basic ideas.

output-oriented approach to management.

all our employees “produce” in some sense—

One basic role of management—the role of disseminating information—is no longer as important a managerial function as it was in the past.

one-on-one meeting

continually looking for ways to make things truly better in your department.

every hour of your day should be spent increasing the output or the value of the output of the people whom you’re responsible for.

Are you plugged into what’s happening around you?

it consistently uncovers brand-new management ideas or finds new insights into old standards.

High Output Management teaches the reader how to be great.

the essential difference between a manager and an individual contributor.

A manager’s skills and knowledge are only valuable if she uses them to get more leverage from her people.

“When a person is not doing his job, there can only be two reasons for it. The person either can’t do it or won’t do it; he is either not capable or not motivated.”

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

meetings.

how to conduct a one-on-one.

A test might be to imagine yourself delivering a tough performance review to your friend. Do you cringe at the thought? If so, don’t make friends at work.

it better to be a hands-on or hands-off manager?”

motivation and training.

He uniquely balances the highest standards for clear thinking and performance with an undying belief in the underlying person.

He is amazingly perceptive and can see every flaw in every person, yet despite that he believes in human potential more than anyone.

Production’s charter cannot be to deliver whatever the customer wants whenever he wants it, for this would require an infinite production capacity or the equivalent—

The first thing we must do is to pin down the step in the flow that will determine the overall shape of our operation, which we’ll call the limiting step.

the total throughput time.

The key idea is that we construct our production flow by starting with the longest (or most difficult, or most sensitive, or most expensive) step and work our way back.

three fundamental types of production operations:

assembly,

test,

equipment capacity, manpower, and inventory can be traded off against each other and then balanced against delivery time.

your task is to find the most cost-effective way to deploy your resources—

All production flows have a basic characteristic: the material becomes more valuable as it moves through the process.

A common rule we should always try to heed is to detect and fix any problem in a production process at the lowest-value stage possible.

Let’s say that as manager of the breakfast factory, you will work with five indicators to meet your production goals on a daily basis. Which five would they be? Put another way, which five pieces of information would you want to look at each day, immediately upon arriving at your office?

because indicators direct one’s activities, you should guard against overreacting. This you can do by pairing indicators, so that together both effect and counter-effect are measured.

first rule is that a measurement—any measurement—is better than none.

a genuinely effective indicator will cover the output of the work unit and not simply the activity involved.

you measure a salesman by the orders he gets (output), not by the call...

second criterion for a good indicator is that what you measure should be a ph...

they spell out very clearly what the objectives of an individual or group are.

linearity indicator.

stagger chart, which forecasts an output over the next several months.

two ways to control the output of any factory.

build to forecast,

So “building” to forecast is a very common business practice. Delivering a product that was built to forecast to a customer consists of two simultaneous processes,

inventory should be kept at the lowest-value stage,

But if we have carefully chosen indicators that characterize an administrative unit and watch them closely, we are ready to apply the methods of factory control to administrative work.

incoming material inspection