Sometimes a Little Micromanagement is a Good Thing

Hello All! It's been a while since we updated our blog, and this topic is a great example of how having flexibility in your leadership toolkit is a great thing -- especially if you want to get stuff done. And what entrepreneur doesn't want to get stuff done?

Modern entrepreneurs and managers of growing companies have long boasted about the benefits of a flat, lean organization. Surrounding themselves with smart, motivated colleagues allows the boss to focus on the big picture -- the cohort accomplishes more because the boss doesn't have to help with the details and micromanage. This leadership style is welcomed by the team, who appreciate the respect and trust of the leader -- and appreciation manifests itself in even higher job satisfaction and productivity.

But in the December 2009 / January 2010 issue of Inc magazine Joel Spolsky makes a case for why entrepreneurs need to keep the ability to sometimes micromanage in their leadership toolkits. In his How Hard Could it Be column, Spolsky's article When and How to Micromanage sums up the recognition for micromanagement like this:

"At the top of every company, there's at least one person who really cares and really wants the product and the customer experience to be great. That's (the entrepreneur and close staff). Below that person, there are layers of people, many of whom are equally dedicated and equally talented. But at some point as you work your way through an organization, you find pockets of people who don't care that much. For them, it's a job. They just want to get through the day and don't find (less-than-awesome performance) upsetting.
If you're lucky, none of those people are employed by your company. But the minute you begin to rely on outside vendors, you expose yourself to their people, some of whom inevitably just won't care enough or know enough or have the right skills to deliver the awesome experience you're trying to deliver."

So -- sometimes the most motivated for results have to get into the gritty details and help the team work out the issues. Handing out objectives ("Get the phones hooked up by Thursday...or else") is probably not as effective as helping the team with the details of building a process and/or checklist (determine the number of phones, select system, schedule service provider, etc.) -- especially if the task is complex and you really want to get it done right. Applied strategically with planning and care, micromanagement is a powerful leadership tool.

Compensation Rules

Darren Dahl writes The New Rules of Compensation in the July/August 2009 issue of Inc and talks to four entrepreneurs about changes they made in their employee compensation strategy. The tactics are varied, but the results all point to a better bottom line AND HAPPIER EMPLOYEES!

Go figure. What works? How about:

• Eliminating a 5% premium over competing employers by paying market rates as an alternative to layoffs.
• Changing the commission structure so salespeople earn a bigger commission the less they discount the price.
• Making a fast price change to reflect new market realities, and then restoring a previous pay cut to compensate the team's hard work.
• Using the opportunity to replace B-Team players with A-level performers. "When we replace the B-level performers, it actually elevates morale" says the owner.

Dahl refers to today's economy and it's effect on employee compensation as "unprecedented". Managed carefully, entrepreneurs can lever the circumstances to create win-win opportunities for both themselves and their employees.

Jerkiness and Bad Decisions

Tom Davenport's NEXT BIG THING BLOG on the harvardbusiness.org site has an interesting entry Why Jerks Are Bad Decision-Makers which dives into the correlation between the jerkiness and the bad decision making of executives. Davenport recalls some of the all-star executive a******s and their world-class blunders, including:

• Joe Cassano, CEO of AIG, and Credit Default Swaps for Subprime Mortgages.
  
• Jimmy Caen, CEO of Bear Stearns, and how overconfidence destroyed an 85 year old investment bank.
  
• Dick Fuld, CEO of Lehman Brothers, and how arrogance and personal disrespect may destroyed any hope of a US Treasury bailout for the firm.

Davenport's summary points certainly resonate with the values I hold -- basically, extensions of the "Golden Rule". But his closing line is what gives me pause:

"Jerks often seem to get ahead in firms and advance through the ranks, but that's a dangerous phenomenon. If you want good decisions in your organization, don't hire, promote, or retain jerks."

Dangerous phenomenon? Yeah, I guess the utter destruction of billions of dollars of investor wealth and the near collapse of the world financial system due to personal arrogance, greed, and pettiness could be thought of as beyond risky.

So, why do so many jerks end up hired, promoted, and retained in some of the most powerful positions at the most powerful companies?

Product Development at the Improv

While buying books for my son's high school summer reading assignment on Amazon.com, I stumbled on Improvisation for the Spirit: Live a More Creative, Spontaneous, and Courageous Life Using the Tools of Improv Comedy by Katie Goodman. Goodman is an improv comedian who has recognized the correlation between skills required for comedic improv -- quick-thinking, collaboration, getting out of your own way, and being in the moment without being a perfectionist -- and skills required to be more effective in working with others in everyday life.

My interest in these skills stems from my comfort zone and my own social style and feedback I've received -- the situations of being uncomfortable without a script, worrying too much about the past and future, and negating someone's idea all sounded too familiar. The book includes exercises, and I found those quite challenging as well. But I'm looking forward to the growth opportunity and the chance to try something new.

Bottom line, I've found the book interesting, useful, and applicable to the product development process. The book opens with the "The First Four Skills of Improv", which are great skills to have in any collaborative situation:

#1 - You Must be Present and Listen Carefully -- "To be creative with others and to brainstorm solutions, you must first understand where everyone is coming from, and to do that, you've go to listen. (And not sneak a peek at your incoming text messages.)"

#2 - Don't Negate -- "Negation is when you deny someone's idea. The classic example actors use to explain negation is this:

One actor says, "Hey, look at the that pink elephant!"
The other actor says, "What are you talking about? There's no pink elephant."
Plop. The first actor is shot down, and there's nowhere to go."

#3 - Affirm and Add -- "You accept what your partner is suggesting, and you add to it."

#4 - Always be Willing to Surrender your Plans -- "In improv, you must be willing to give up your idea if it isn't working or the time to offer it has passed. You might be tempted to negate a new idea simply because you're attached to your original one. But the better approach is to go with flow and alter your course."

Good stuff, and an interesting approach to improving collaboration and team-building.

btw - my fave quote from the book: "Is anal-retentive spelled with or without the hyphen?"

The Power of Personal Metrics

Finally getting caught up on some reading, and came across The Nike Experiment: How the Shoe Giant Unleashed the Power of Personal Metrics by Mark McClusky in the July 2009 issue of Wired. Most of you who know me know I've lost a significant amount of weight over the past two years (~40 lbs.) largely through increased exercise. Although I do not use the Nike+, I do use a Polar heart rate and speed / distance monitor and log my training on the PolarPersonalTrainer website. I've also started to use the MapMyFitness.com and Facebook sites to track my progress and share the results with friends. The results, for me, have been incredible. The tracking of metrics has allowed me to chart progress and identify what works well and what doesn't. And sharing my progress has generated words of encouragement that keep me motivated. Any operations manager will tell you that if you want to improve something, measure it objectively and set goals for improvement. Turns out it works for weekend-warrior athletes as well as olympians and companies.

While your at it, check out Wired's 10 Gadgets We’d Like to Throw Into a Black Hole.

Wisdom for Entrepreurs

In the July/August issue of Inc. Street Smarts columnist Norm Brodsky answers questions from readers on a variety of start-up and growing business issues. Some highlights:

"Entrepreneurs don't make good employees. What's more, they are often crummy managers."

"It's a bad idea to offer ownership in a new business to people who are making no investment but their time."

"In times like these, it is natural to worry about survival [cash flow]. But you need to remember that recessions don't last forever. Just don't make the usual mistakes. Now is not the time to cut back on your marketing and product development. Whatever you do, don't fall into the trap of cutting prices. Offer additional services instead."

Check out the rest of the Norm's column here.

Also, check out Norm's 10 Things Every Entrepreneur Needs to Know. Good stuff.

Managing through Better Questions

I recently discovered the Harvard Business Publishing website -- lots of good (and free!) info on managing and leading here. Found Judith Ross' blog entry How to Ask Better Questions with some great tips on putting leadership into practice. I've always been a supporter of participative leadership, where you focus on collaboration with and delegation to subordinates on finding solutions to problems. Although sometimes frustrating, in the long run it beats being "the answer man" and enables teaching and learning that creates a very healthy and capable organization. Ross has interviewed Michael J. Marquardt, a professor of human resources and international affairs at George Washington University regarding his book Leading with Questions: How Leaders Find the Right Solutions by Knowing What to Ask (John Wiley & Sons, 2005). Marquart makes the case for asking questions instead of offering solutions, and suggests effective questions have the following characteristics:

1.They create clarity: "Can you explain more about this situation?"

2.They construct better working relations: Instead of "Did you make your sales goal?" ask, "How have sales been going?"

3.They help people think analytically and critically: "What are the consequences of going this route?"

4.They inspire people to reflect and see things in fresh, unpredictable ways: "Why did this work?"

5.They encourage breakthrough thinking: "Can that be done in any other way?"

6.They challenge assumptions: "What do you think you will lose if you start sharing responsibility for the implementation process?"

7.They create ownership of solutions

Check out www.harvardbusiness.org for more great management and leadership information and resource.

Dew We Think Detroit Ready for Next Year's Modules?

Charles C. Mann writes in the June 2009 issue of Wired about the need for fundamental change in how Detroit manages technological innovation and the explosion in automotive related start-ups. Venture capital supplied roughly $300 million to fund auto-related companies in 2008, a 3,750% increase from the $8 million invested in 2003. New enterprises like California-based Tesla Motors and Transonic Combustion are bringing new innovation and a garage-shop, Mountain Dew and pizza-fueled entrepreneurial excitement to an industry that's been mostly hostile to outside innovation.

Mann writes...

If a domestic auto industry is to survive, it will have to incorporate and encourage breakthroughs from outsiders....Automakers will need to transition from a vertical, proprietary, hierarchical model to an open, modular, collaborative one, becoming central nodes in an entrepreneurial ecosystem. In other words, the industry will need to undergo much the same wrenching transformation that the US computer business did some three decades ago, when the minicomputer gave way to the personal computer.

By shifting away from vertical integration, [the American car makers] will inherently play a smaller role in the overall industry. As system architects, they would lay down the framework in which independent developers work, communicating and enforcing those standards with would-be suppliers.

...[I]n seeking a model for outsourcing in a heavily regulated industry, automakers might look to pharmaceutical companies, which also operate under severe regulatory, legal, and safety constraints. Manufacturing is simpler for drug companies, but the process of testing new products with clinical trials is nightmarishly complex and costly. Yet this has not prevented drug firms from relying on outsiders; they routinely buy startups and test out their technology. Many or most of the acquisitions prove unusable, but the successes pay for failures. Managing and using outside innovation is difficult, but it has helped keep the US drug industry alive in a climate of unforgiving competition.

Mann makes a strong case, but there hardly seems to be support for this revolutionary approach to innovation within the industry. Although hit hard by the economy, Toyota and Honda still rely on internal and their traditional suppliers for innovation and have made no attempts (at least publicly) towards using the pharmaceutical model for new innovation. Ford, the most likely of the Detroit 3 to survive without bankruptcy protection, or Fiat, who will soon control Chrysler, are not publicly signaling such a radical shift in their engineering innovation processes. Perhaps the remnants of GM will bite, but it sure seems like a long shot to get Detroit to give up percolated coffee for Mountain Dew as the innovation beverage of choice. The very interesting thing is -- it might not matter what GM, Ford, Chrysler/Fiat, Toyota or Honda do, as their ability to dominate an industry has been severely compromised.

Reid Hoffman and Greenspace

Another great read in the May 2009 issue of Inc. magazine, the "How I Did It" section features the story of Reid Hoffman, founder of LinkedIn. I'm a huge fan of LinkedIn -- I'd say it's the most relevant and useful of all the social networking sites. You'll notice my LinkedIn profile link on the right-hand column of this blog, and you can also find my profile by clicking here.

At Stanford University Hoffman studied symbolic systems, which he describes as the combination of artificial intelligence and cognitive science. He worked at Apple and Fujitsu Software before launching Socialnet in 1997. He left Socialnet in 1999 to join Paypal before it was acquired by eBay, and then launched LinkedIn in 2002.

ON LAUNCHING A COMPANY:

"The trick to doing well with these things is to be in a place where people are saying, Hey, that's a crazy idea. If you're right, there's the opportunity to produce something really big. You
want to be one to three years early. You want to start before others think it's an easy idea. It's much harder to be successful when 10 similar things are being financed."

There's analogy to this philosophy in coaching soccer. To get the team to advance the ball to the goal, often the best opportunity is the play the ball to an open area -- "Greenspace" -- where your attackers can gain possession of the ball and continue the attack with many more options for creative play. Unfortunately, many inexperienced players will play at the nearest available option -- whatever appears safe, because the player in control of the ball can visualize the next steps. It's often not particularly productive, because your opponent sees the same scenario and can react accordingly. That's why trust and confidence in your teammates is so important in sports -- you want to be able to exploit the skill and creativity of your teammates to go somewhere and do something the other guys didn't think was possible.

Why Circuit City Can't Blame the Economy

In the May 2009 issues of Inc., Joel Spolsky writes about the demise of Circuit City. Spolsky notes that everyone, from Circuit City's CEO to the Associated Press blamed "poor economic conditions" for the end of one of the nations largest retailers. Yet somehow Best Buy, Apple, and independent electronics retailers like B&H Photo seem to thrive in these conditions -- folks literally line-up on weekends to make purchases. Poke a little into the Circuit City business model, and you'll find the real reason for the failure: COMPELLING THE CUSTOMER TO SHOP ELSEWHERE...

• Aggressively unknowledgeable salespeople, caused by firing anybody who knew anything about electronics.
• Aging mechandise, including offering "Y2K Ready" laptops in 2007
• A frustrating experience once the customer decided to buy
• Uncompetitive pricing, including raising prices for the liquidation "sale"

Yuck! No tears shed here. It's how capitalism is supposed to work -- treat your customers poorly, and you will fail.

Every Product Manager's Dream: Obsessive Consumers

In the May 11, 2009 issue of FORTUNE check out Beth Kowitt's article "True Obsessions". Here are six stories of people who take consumerism to a whole new level. These folks don't just purchase the latest products from their favorite companies, they continue a deep (and perhaps slightly psychotic) emotional committment to a specific brand through how they've integrated the products into their lives.

Questions for marketing and product managers:

• Who are your obsessives?
• Where are they? How do you find them?
• Are you giving your customers the potential to be obsessive about your product?

Mom's home, and she's really mad: The Product Development Pipeline at Yahoo.

In the April 27 issue of Fortune magazine I read Jon Fortt's article "Yahoo's Taskmaster" about Carol Bartz, the new CEO at Yahoo. Bartz is most recognized as the retired CEO of Autodesk, makers of the ubiquitous AutoCAD suite of engineering tools. Under her 14-year reign, Autodesk increased sales at a 13% compounded annual growth rate and the stock price peaked at an 8X increase.

According to Bartz, the success at Autodesk is the result of disciplined product management. Once slow to innovate, she led Autodesk to grow its offerings by acquisition and a focus on new products developed internally. So you would assume that she would employ the same approach at Yahoo. But wait, hasn't Yahoo continuously rolled out new product and features on its core site to attract new and keep existing users? Varied and sometimes multiple products for on-line dating, job posting, original entertainment, photo sharing and social media have been introduced on the Yahoo.com portal, some even more timely and technically better than the offerings from competitors like Google. Few, if any, of these products have made strong connections with customers, and Yahoo has a reputation not as a leader but more like a company whose best days are past.

Bartz has identified the problem as the management of Yahoo's product development pipeline -- it's a mess. Bartz is not impressed with the chaotic management structure and unconventional job titles instituted by the founders, including "Chief Yahoo" Jerry Yang. She referred to Yahoo's product management as "amateur hour" and is revamping the process:

• Roll out new product and features BASED ON CUSTOMER FEEDBACK
• Completely DROP PRODUCTS THAT HAVE NO COMPELLING REASON TO EXIST.
• OBTAIN FEEDBACK FROM THE CUSTOMER at every stage of the product development cycle
• Make sure PRODUCTS ARRIVE ON SCHEDULE
• Use the best ideas from customers to update product in the next version to GIVE CUSTOMERS A REASON TO COME BACK AND BUY MORE

In other words, expect Mama Bartz to whip the Yahoos into shape (perhaps literally, as Fortt mentions Bartz's widower father used a belt to discipline his kids). Known for once sending a casually-dressed subordinate home to put on a coat and tie, surviving Carol Bartz means the Yahooligans may need to embrace the business-wear department at Macy's as well as the concept of a management control.

Stay tuned...this should be fun to watch.

Welcome to the Mackie Associates blog!

Welcome to the Mackie Associates blog. Here we will publish news, information, our observations and other items of interest in the areas of engineering and program management for growing business.

About Mackie Associates
Mackie Associates LLC is a provider of engineering leadership and program management services to growing businesses. Our mission is to scale and make accessible the latest, most effective engineering and program management tools and provide services and leadership that enable growing companies to get the job done. Our practice is based upon 28 years of product development, marketing, and manufacturing success in the semiconductor and automotive industries. We have hands-on, practical experience in leading technical people and solving problems around the globe. We have completed extensive formal business and technical training and continue to seek learning opportunities to improve the service we offer. We believe this commitment to continuous improvement and learning is what makes us different from other service providers.

Glen Mackie, PE
Mackie Associates LLC
P.O. Box 700181
Plymouth, Michigan 48170
USA

gmackie@mackieassociates.com