https://en.wikipedia.org/wiki/W._Edwards_Deming#Seven_Deadly...
Years ago in an effort at self improvement I did a postgrad course on software quality. Studying what Deming has to say was a big part of it. Turns out it is not so easy to apply it to engineering (as opposed to manufacturing what the engineers designed), and the ham fisted approaches the postgrad course was promoting at the time (like CMM) didn't look promising, and with the benefit of 20 years hindsight now look farcical.
Nonetheless, his dogma of extracting statistically valid measures of processes, propagating those through the organisation so harvesting everyone's ideas on how to improve them struck a deep cord, and it's something that I've tried to apply ever since. I've been exposed to other MBA related ideas, but that is the only one that ever made sense to me.
It's a pity it's so damned hard to apply to software engineering. It has one one notable effect - I'm now seen by my co-workers as near obsessive about collecting and monitoring failure rates - whether they be bugs or things like people reporting software being difficult to use.
And somehow that got cargo-culted into "we should continuously get rid of the bottom X% of people all the time".
his book maybe?
He was still defending the practice in 2005: https://usatoday30.usatoday.com/educate/college/careers/Advi...
> You've got a bad take on it. It's letting the bottom 10% know where they are and then giving them a chance to move on. About 70% (of the bottom 10%) leave on their own. Who wants to be on the bottom once they know it? You don't fire them. That's being mean.
Though of course firing is always an option especially in the USA.
From that article the key point I found was that he would rather expend company resources nurturing top performers instead of salvaging the bottom performers. He believes it's a much better investment.
This is why the sensible thing to do is to save up a cushion of 6 months. You can continue with your employer health care with COBRA for 6 months or a year.
For example, I know a fellow who told me he could not handle the slightest disruption in his paycheck. He was driving a new car, living in new house, wore expensive clothes, and was starting a family.
A friend of mine living in an apartment told me he was unable to pay his bills. I asked him what the payment was on his new car. I suggested he sell the car, and buy a car he could pay cash for. He surprised me by following my advice and was able to reduce his stress about his finances.
My father, an officer in the AF, was once tasked with counseling the privates on their finances, as many were unable to pay their bills on the local economy. (The AF really tries to be a good citizen in the community where the base is located.)
The privates were paid every two weeks. Half of them drank their paycheck away and ate steak for the first week, and begged/borrowed/stiffed others for money the second. They received the same paychecks, but half could not manage their finances. My father would counsel them, work up budgets for them, all for naught.
Apart from the upfront restaurant bills, also you can save money health wise on the longer run.
Or, another scenario, the 'poverty line' is arbitrary and hardly an indicator of universal financial power.
In other words : the poverty salary 'line' tells you nothing of burden, it's just a magic number. If an individual has multiple unknown burdens, their 'poverty line' is at a much different , unknown, level.
I live in California, mostly. I know of families that live (far) below the 'Poverty Line', but because they send everything they can back to their home country for the rest of their family to live on.
Suddenly an individual at the poverty line is supporting 3-7 people in another country; and has no real legal way to justify or exemplify the practice in any legal financial way that would signify their increased burden - they become essentially a lost statistic and generally lie on their taxes due to fear of losing the arrangement.
Individuals that lead this style of life tend to go back home periodically simply because the burden of living in the US with a sub-poverty income isn't realistic.
tl;dr : The poverty income line alone means next to nothing in personal context. Don't assume that you can dwindle every persons' life down to fitting within it, that's not realistic. Saving money is absolutely important, I agree, but let's not just assume that that kind of financial flexibility exists for every individual. It'd be nice, but it's fantasy.
I said "a majority of people". Not every individual.
For some other people, if they'd drop the "keeping up with the Joneses" mentality even just a little bit, they could develop significant savings.
Yes, there are many people in the US who are just barely getting by, and can't meaningfully save without making cuts to essential spending, but that certainly doesn't describe everyone who currently lives paycheck-to-paycheck.
Signed, a homeowner who sees a lot of his less well off neighbors making much more extrvagant purchases than he does.
Braces for downvoting
If you're a democrat, it's because the economic deck is stacked against people.
I thought that a very large majority of credit card debt was healthcare costs and other structural life costs, so that is score one for the democrat view, although we are a very unhealthy population (so back to the republican view a bit)
Then again, the real estate bubble showed that people were getting way too much house (republican view)... of course enabled by almost no oversight of the lending and financials underling it (democrat view).
Did you even read my post? I specifically noted this doesn't apply to poor people (the ones the right-wingers will claim are only poor because of bad choices), I'm addressing middle-class and up people.
As a non-cook myself, I can fry some eggs in 3 minutes or so, and a steak a bit longer. Sometimes I'll dump a bowl of frozen veggies into a bowl, put a pat of butter on top, microwave for a couple minutes, and it's ready to eat. A can of beans takes a couple minutes.
The idea that to eat decent food requires much prep time in the kitchen isn't true.
There are numerous Americans and American institutions whose work specifically involves pushing the interests of insurers, pharma and hospitals on Capitol Hill, against those of average people who work minimum wage jobs and can't afford basic coverage.
Our system is messed up.
1. Cutting cost will always yield a quick gain
2. It's a lot more difficult to turn it around and win in the long term
3. Even if the banker wants a long term picture, cutting cost is not necessarily a bad idea.
In my first year there I had 3 different managers, so by the time my review came around, nobody really knew me very well. At least not well enough to fight for me in the ranking meetings.
So ultimately, I received the lowest ranking. What made it most annoying is that it was prefaced with a speech about how I was doing a good job, but someone had to get that ranking. This was just me.
About the only good advice that manager gave me was that if this happened again, I should leave the company because it was going to be an endless spiral that I couldn't get out of.
It was actually the last time they did the stack ranking and I left before finding out if things got any better. The whole project I was on got canceled a few weeks after I left anyway.
He consistently increased earnings via Windows and Office during his tenure as CEO. He was a very good businessman.
He was not, however, a product guy. Witness their failures with the Zune, mobile, search, and early cloud computing. His problem was that he always tried to do what would be best for Microsoft first and not the customer. You can get away with this if you already have an entrenched install base (windows/office), but with net new products people will look at what's best for them first. Even with developers developers developers he tried too hard to get people to use pure MS tech and made developing for the web on MS ugly if you are using anything other than .NET. He didn't see the geeks learning to program in their basement or dorm rooms who ended up using free software instead of going through any "free" channels that may have been available to them (were they?). The result is a generation of developers on Macs and to a lesser extent linux. MS is only now catering to them.
Funny enough, thinking of the customer is what MS did with the xbox and it worked out well enough.
In my experience this turns out be a huge scam. Worse a legally sanctioned scam.
Say she had 11 members in her team. She will give $90 to her pet, and $1 each to the remaining 10. That is how this works on the longer run. The definition of a 'high performer' is often hazy here, and a case can be built up to justify giving the money to whom she wants.
Eventually it turns out there are enormous cartel like structures, you have to be in them to get paid up well. Or you slog like a donkey and quit eventually.
People who are supposed to approve, audit and verify are a part of the same system playing with the same incentives.
Uh...no. He was a trained chemical engineer, and understood products, manufacturing, and operations perfectly well.
In his own words, here's why he emphasized finance:
"My gut told me that compared to the industrial operations I did know, this business [GE Capital] seemed an easy way to make money. You didn't have to invest heavily in R&D, build factories, and bend metal day after day. You didn't have to build scale to be competitive. The business was all about intellectual capital - finding smart and creative people and then using GE's strong balance sheet. This thing looked like a 'gold mine' to me." (emphasis mine)
A good MBA finance curriculum might kick off with the Modigliani-Miller theorem (M&M), which basically says:
1. Theoretically, you can't create value through your mix of financing. It doesn't matter whether you use 100% equity, 100% debt, or 50/50, your mix of financing won't create value (unlike good R&D for example).
2. #1 above is predicated on the absence of tax incentives, bankruptcy costs, agency costs, and asymmetric information, and the market being efficient.
The creators of M&M believed that the assumptions in #2 are mostly false most of the time. The beauty of the theory is in the assumptions themselves. Prescriptively, it basically says that your mix of financing matters only insofar as the assumptions in #2 are false for your project at your company in your country. If you start a division like GE Finance, and you start using complicated financial derivatives, you have several things to prove. You have to show which M&M assumptions are false for your company, to what degree they are false, that your suggested method of financing will take advantage of the M&M violations, and that the magnitude of financing matches the magnitude of M&M assumption violation (this last bit is important, GE really went hog wild with derivatives in a way that was completely not justified). GE Capital never passed the M&M sniff test.
Modigliani-Miller refers to the financial structure of your corporation, GE in this case: it refers to the mix of capital that GE raises from investors (debt + equity). To give a simple example to illustrate, the value of your lemonade stand as a business is based on your revenue minus your costs, it's based on your "business". You need to raise money to buy your raw materials and equipment to get started or expand? Whether you borrow that money or sell shares in your lemonade stand does not change the value of your business. The bit about absence of tax incentives is because you can write off the interest on debt from the income taxes, but the dividends you pay actually get taxed, so there is an incentive for the equity holders to raise some money via debt rather than equity; but the point that M&M makes remains true.
GE Capital did not fund GE, so M&M doesn't apply.
M&M would apply to GE's ownership of GE Capital, but if all the debt and equity is owned by one entity there really isn't a difference between them (see Humpty Dumpty, back together again).
It's quite common for large industrial companies to have large credit arms: oil companies extend credit to gas stations to buy their gas, just like automobile manufacturers finance car purchases. GE was no different. Leveraging their expertise in finance was a natural extension of the business, and financial firms sometimes fail like any other business, whether they are standalone or wholly owned subsidiaries.
Welch more than quintupled GE during his time. None of his successors could manage the company so what he built is slowly being dismantled. What I never understood is why they didn't just split the company in half which would have returned more value to the shareholders.
Or GE Financial was hiding a ton of bad debts while he was in charge.
"Tell me about a time when..."
"I want to see how you think."
"What your greatest..."
95% of my philosophy is don't be an asshole, work hard, know my stuff, and don't let the turkeys get me down. I spend no time dwelling on mistakes, as I internalize the lessons and throw out the reason I learned those lessons.
So does Jeff Bezos. 10% forced "least effective" is still implemented here at Amazon and is truly destructive. The quota often gets passed down to small teams. The worst part is that performance evaluations have almost nothing to do with performance.
Juking the stats! I'm shocked there isn't a middle management bible dedicated to this.
Where is the hackers guide to middle management?
During the 2000s and early 2010s Microsoft's stack-rank reviews were infamous for the internal politics created. Didn't matter if you had a full team of top-tier engineers, the bottom 15% WAS going to get managed out. Savvy managers would hire low-tier performers to protect the productive ones.
That's the only lens through which I have to view Mr. Welch's contributions unfortunately.
https://en.wikipedia.org/wiki/Vitality_curve
https://money.cnn.com/2013/11/13/technology/enterprise/micro...