The Goal: A Process of Ongoing Improvement, Third Revised Edition
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new measurement system."
"That's right," I smile.
"Is a new measurement system important for you?"
"Are you kidding? I don't know of another single thing
which is as important as that."
"So if it weren't for Jonah's refusal to continue giving you
pointed questions, am I right in assuming that you'd be on the
phone right now, trying to squeeze more hints from him?"
"Most probably," I admit. "It's certainly important enough."
"And what about Bob's idea," she continues. "Do you regard
that as something important?"
"If he pulls it off it'll be a revolution. It'll guarantee that we
take a big share of the market. Definitely our problem with get-
ting more sales will be over."
"And how much hope do you have that he'll be able to do
it?"
"Not much, I'm afraid. Ah. I see your point. Yeah, I would
have run to Jonah with these questions as well. And the same with
the issues that Stacey and Ralph have raised, each one of them is
essential."
"And how many more things will pop up when you start to
manage the division?"
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"You're right, Julie. And Jonah is also right. I felt it today as
well. When each one of them spelled out their immediate dream
in such a tangible form, I wondered what mine is. The only thing
that kept popping into my mind is that I must learn how to man-
age. But where on earth am I going to find the answer to Jonah's
question: What are the techniques needed for management? I
don't know, Julie. What do you think I should do now?"
"All the people back at the plant owe you a lot," she says,
stroking my hair. "They're proud of you, and rightfully so.
You've created quite a team. But this team is going to be broken
up in two months when we go to the division. Why don't you
spend the time that's left sitting with them and going over your
question. They'll have ample time after you're gone to work on
their problems. Anyhow, it'll be much easier for them to achieve
what they want to achieve if you have the management tech-
niques."
I look at her in silence. Here is my real, true advisor.
So I've done what my advisor suggested. I gathered them all
together and explained that if each of them wants to be free to
concentrate on his pet project the division must be well run, and
in order for the division to be well run the division manager must
know what he is doing. And since I, frankly, don't have the foggi-
est idea of how to run a division they had better put their brains
to helping me. Thus, we are going to devote the afternoons—
provided of course that no special emergency comes up—to help
me analyze how the division should be run.
I decide to start the meeting with the most naive questions.
Initially they might think that I've lost all my self confidence, but
I must expose to them the magnitude of the problem I'm about
to face. Otherwise I'm going to end up, at best, with some frag-
mented, vague suggestions.
"What are the first things I should do when I assume my
new position?" I ask them.
They look at each other, and then Bob says, "I'd start by
visiting Hilton Smyth's plant."
After the laughter dies, Lou says that I should first meet with
my staff; "you know most of them but you've never worked
closely with them."
"What is the purpose of these meetings?" I innocently ask.
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If this question had been asked under any other circum-
stances they would have taken it as a clear indication of a total
lack of managerial knowledge. As it is they play the game.
"Basically you should do general fact finding first," Lou an-
swers.
"You know," Bob adds, "like where the entrance is, where
the toilets are . . ."
"I do think that meeting the people is important," Stacey
interrupts the laughter. "Financial numbers only reveal a small
fraction of the picture. You have to find out what the people
think is going on. What do they see as problems? Where do we
stand vis-a-vis the clients?"
"Who has a grudge against whom?" Bob contributes, and
then in a more serious tone. "You also have to get a sense of the
local politics."
"And then?"
"And then," Bob continues. "I'd probably take a tour of the various production facilities, visit some of the big clients, and
probably even some suppliers. You've got to get the full picture."
Maintaining my poker face I ask, "And then?"
At last I've succeeded to provoke them, since both Stacey and
Bob answer vehemently, "And then you'll take it from there!"
How easy it is to give advice when the responsibility is on
someone else's shoulders. Okay wise guys, it's time to turn the
table, and in a calm voice I say, "Yes, what you suggested just now
is the usual line of action one takes when he is told to 'go there
and fix it.' Let me play it back for you, but in a more schematic
way. Where are the colored markers?"
I grab a red marker and turn to the white board.
"The first step, as you all have pointed out, is fact finding. I
hold a staff meeting and what do I find? Oh, here we find fact A,"
and I draw a nice red circle. "And here are three somewhat
smaller circles. And here is a tiny one and there are two which are
overlapping. Now let's talk with another manager, this is very
helpful. You see, this circle, he claims, is not as big as we were led
to believe. And here, in the left upper corner are two more big-
gies. Now, someone else reveals to us that some rectangles exist.
We check, and yes, he's right. Here there is one and here and
here and here. We're making progress, the picture starts to un-
fold."
What they actually see is how the white board is getting the
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measles. It looks like one of the drawings my kids used to bring
home from kindergarten.
I don't think they got the message, they just seem confused;
so I decide to continue a little more bluntly. "It's about time to
talk with another manager, we must get a sense of the local poli-
tics. Oh, this is very interesting, there are also green circles, and
even some green stars. Here's an unidentified shape—never
mind, we'll address it later. Now, let's tour the production facili-
ties, visit clients, and even some suppliers. We're bound to reveal
many more interesting facts." As I talk the board is filled with
overlapping shapes.
"Now that we have the full picture, we can take it from
here," I finally conclude and put the markers down. "Well?"
The board looks like a nightmare in Technicolor. I take a
deep breath and pick up the phone to order more
coffee.
Nobody says a word, not even Bob.
"Let's make it less personal," I say after a while. "Suppose that we are a committee that's been given the ungrateful task of
'find out what's going on.' How do you suggest we should start?"
They all smile. Somehow pretending that we're a committee
makes us feel much better. "The safety of being part of a herd," I think to myself; the blame will not be aimed at anyone in particular.
"Ralph, will you volunteer to describe the committee's ac-
tions?"
"They would probably start in the same way—fact finding.
And as you so vividly demonstrated, they would end up in the
same colorful ditch. But Alex, is there any other way to start?
How can you do anything sensible without knowing what's going
on, without having the data?" Ralph is true to his profession; for
him, knowing what's going on is equivalent to having the data
neatly stored in his computer files.
Bob points to the white board and chuckles, "You call this
mess knowing what's going on? Alex, come on. We all know that
this nonsense of fact finding will continue until our committee
runs out of ideas for gathering further facts."
"Or they run out of time," Stacey adds with a bitter smile.
"Yes, of course," Bob accepts, and turning to everybody he
finishes his questions, "What do you think that we, acting as a
committee, would do next? We know a committee can't submit
this mess."
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They all laugh nervously. I'm really pleased. They've finally
started to realize the problem that I'm facing.
"What are they going to do now?" Stacey muses. "They'll
probably try to arrange this monstrous pile of facts in some or-
der."
"Most likely," Lou agrees. "Sooner or later one of the com-
mittee members will suggest organizing the shapes according to
their relative size."
"I don't think so," Bob disagrees. "Determining the relative size of different shapes is quite difficult. They will probably decide to organize them according to the type of shapes." Lou
doesn't seem to accept this, and so Bob explains, "They can ar-
range the data by circles, rectangles, and stars."
"What are they going to do with those four arbitrary
shapes?" Ralph asks.
"Probably they'll be put in a class of their own, the excep-
tions."
"Yes, of course," Ralph agrees. "The major reason for the
constant reprogramming are those exceptions that keep popping
up."
"No, I have a better idea," Lou says stubbornly. "They'll
probably arrange them by color; in this way there will be no
ambiguity. Tell you what." He continues when he realizes that
Bob is about to object, "Let's arrange them first by color, within
color by shape, and within each subclass we'll arrange them by
size. This way everybody will be happy." Count on Lou to find an
acceptable compromise.
"It's a marvelous idea," Ralph picks up the ball. "Now we can submit our findings in the form of tables and histograms. It will be
a very impressive report, especially once I pump up the graphics
package. Minimum two hundred pages, guaranteed."
"Yes, an impressive, in-depth survey," I say sarcastically. We
all sit silently, absorbing the bitter lesson we've just taught our-
selves.
"You know," I say after a while, "It's much worse than just wasting time producing useless, pompous reports. This overcon-cern about the 'proper way to arrange things' manifests itself in
other harmful ways."
"What do you mean?" Lou asks me.
"I mean the merry-go-round that we're all too familiar with;
arranging the company according to product lines and then
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changing it according to functional capabilities—and vice versa.
Deciding that the company is wasting too much money on dupli-
cated efforts and thus moving to a more centralized mode. Ten
years later, we want to encourage entrepreneurship and we move
back to decentralization. Almost every big company is oscillating,
every five to ten years from centralization to decentralization, and
then back again."
"Yeah," says Bob. "As a president of a company, when you
don't know what to do, when things are not going well, you can
always shuffle the cards—reorganize." Mockingly he continues,
"That will do it! This reorganization will solve all our problems!"
We stare at each other. If it weren't so painfully true, we
might laugh.
"Bob," I say at last. "This isn't funny. The only somewhat
practical ideas I had in mind for what I should do as the new
division manager were all based on reorganizing the division."
"Oh, no," they all groan.
"O.K. then," and I turn back to the white board, which is not
so white any more. "What is one supposed to do with this pile of
colored shapes, except to arrange them in some order? Dealing
directly with the pile is obviously totally impractical. Arranging
the facts according to some order, classification, must be the first
step. Maybe we can proceed from there in a different way than
writing reports or rearranging the company, but the first step
definitely must be to put some order into the mess."
As I continue to look at the board, a new question starts to
bother me; "In how many ways can one arrange the assembled
facts?"
"Obviously, we can arrange them by color," Lou answers.
"Or by size," Stacey adds.
"Or by shape." Bob doesn't give up on his suggestion.
"Any other possibilities?" I ask.
"Yes, of course," Ralph says. "We can divide the board by an imaginary grid and arrange the shapes according to their coordi-nates." When he sees our puzzled looks he clarifies, "It'll give us the ability to construct many different arrangements based on the
shapes' relative position on the board."
"What a great idea," Bob says sarcastically. "You know what, I'd rather use the dart technique—throw a dart and start arranging the shapes according to the order in which we nail 'em. All
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these methods have just as much meaning. At least my last sug-
gestion offers some satisfaction."
"O.K. fellows," I say firmly. "Bob's last suggestion has really clarified what we're dealing with here. We're dealing with the fact
that we haven't got any idea of what we're doing. If we're just
looking for some arbitrary order, and we can choose among so
many possibilities, then what's the point in putting so much effort
in collecting so much data? What do we gain from it, except the
ability to impress people with some thick reports or to throw the
company into another reorganization in order to hide from the
fact that we don't really understand what we're doing? This ave-
nue of first collecting data, getting familiar with the facts, seems
to lead us nowhere. It's nothing m
ore than an exercise in futility.
Come on, we need another way to attack the issue. Any sugges-
tions?"
When nobody answers, I say, "Enough for today. We'll con-
tinue tomorrow—same time, same place."
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35
"Well, anybody got anything good, any breakthroughs?" I
try to start the meeting off as cheerfully as possible. It's not ex-
actly how I feel; I spent the whole night tossing in my bed,
searching for any opening, which I never did find.
"I think that I have one," Stacey speaks up. "Not exactly a breakthrough, but . . ."
"Wait," says Ralph.
Ralph interrupting. That's new.
In an apologetic tone he explains, "Before we go off on a
different angle, I'd like to return to where we were yesterday. I
think we were too hasty in our decision that classification of data
can't lead to something good. May I?"
"Sure," Stacey says, almost in relief.
"Well," Ralph fidgets, apparently uncomfortable, "as you
know, or maybe you don't, I minored in chemistry in college. I
don't know much about it, but one story stuck in my mind. Last
night I looked back at my notes from class and I think you'll find
it interesting as well. It's a story about a remarkable Russian
named Mendeleev, and it happened less than one hundred fifty
years ago."
Noticing that he grabbed our attention, he becomes more
confident. Ralph is a family man and has three little children, so
he's probably used to telling stories.
"Right from the start, in the days of ancient Greece, people
postulated that underlying the phenomenal variety of materials
there must be a simple set of elements from which all other sub-
stances are composed."
As he gets into his story his voice becomes rich with under-
tones.
"The Greeks naively assumed that the elements were air,
earth, water and . . ."
"Fire," Bob completes the list.
"Correct," says Ralph.
What a wasted talent. He's a real story teller, I think to my-
self. Who would have suspected it?
"Since then, as you know, people have proven that earth is
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not a basic element but actually composed of many different