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We perform Product Development System Assessments (PDSA) for our customers. I’m frequently surprised by how many product development organizations still use email as their primary medium for the communication of information. Attached to these emails are test reports, marketing information, requirements, etc. Documentation that is critical to the performance of their product development!

I recently read a British study stating 38% of a knowledge worker’s time is spent looking for information. I can’t really believe that. We’ve run into organizations where it is that high, but not as a standard or average. But event if you discount that and cut it in half, that is about 20% of the time that knowledge workers spend just hunting for information. And this time spent hunting, this loss of efficiency, is invisible because it just gets buried with everything else inside the charges to project time within specific projects.

The other issue we have with email is that it’s open loop. It has no feedback. If the timing of the sending of some information is wrong, then the recipient will have to search through their inbox for the information after the fact and often times will ask for it to be resent rather than hunt for it. Also, you have various revisions distributed across the organization sitting on various hard drives – some of them current and some of them out of date.

When Bowen & Spears, famous researchers, talked about the need for a direct link between internal suppliers and internal customers, I think they talked about that connection as more personal, more collaborative, and closed loop. For your information flow, if you’re still using an open loop system, find a collaborative tool — PLM for instance. Help your researchers and knowledge workers take the pain out of their information flow.

Contact us to learn more about how Systems Thinking and the application of our Product Development Operating System can help your organization become more efficient, productive, innovative, and competitive.

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The default management system that we use is Taylorism or Scientific Management. It’s our default management system because when it was introduced it was highly successful, became deeply rooted, and now is the default management methodology in all parts of an enterprise.

In World War II there was a change in the way that factories were managed. Factory workers went overseas to fight the war and women, farmers, and those physically unfit to serve moved in to occupy vacant positions in factories. Faced with the crisis of needing a reliable supply chain the Army introduced a training program called Training Within Industry or TWI. It introduced a different management system into factories. If you analyze that management system you’ll see that it very clearly reflects the 14 points of management made famous by W. Edwards Deming.

I post-war Japan there was another crisis. There was no industry, there was poverty, and there was idleness. General MacArthur pulled over American resources to train the Japanese and help them rebuild their industry. The system that was adopted by the Japanese is the Deming Management System.

When Deming returned home he was ignored until 1980 when Ford, in it’s own crisis, threatened by the high quality of imported automobiles, sought Deming out as a consultant to help turn around their business.

It’s beyond dispute that the management system we use for knowledge workers and in product development is a management system that fails. It’s counter productive. We know that there is a better way and we know how to move to a better way. The better way is based upon the Deming cycle — PDCA (Plan, Do, Check, Act) — and it’s implemented for closed loop and experiential learning; for improvement.

If we know how to move to the better way, why don’t you? Do you prefer to wait for the inevitable crisis? As Deming said “Survival. It’s optional.”

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When we think of Systems Thinking, most of us think of Peter Senge and his classic book The Fifth Discipline. But the first instance of Systems Thinking that I’ve seen recorded is by W. Edwards Deming. He used “Systems Thinking” in the model of production he first published in the 1950’s at an international conference at Mt. Hakone in Japan.

Deming serves as a nice point/counterpoint with the standard American management system and it’s founder Frederick Winslow Taylor. Taylor believed in open loop process thinking. E.g. You have a job, you have a series of tasks, execute them step by step. Deming is a proponent of closed loop system thinking. In closed loop system thinking the feedback from the system provides opportunity to learn and improve. It’s been clearly shown that in product development, when managed by Taylor’s system, we see counter productive activities and low productivity. When we have Deming’s, we have nothing but good.

It’s probably not surprising if you think about it. Taylor’s fist hand experience was in a labor machine shop. Deming’s first hand experience was as a researcher in an agriculture department and he had a close working relationship and was mentored by the famous researcher Walter Shewhart of Bell Laboratories.

So, if we’re looking for a management system that is appropriately applied to the knowledge workers in product development, whose do you think would be more appropriate? The one from a man with first hand experience in a machine shop or the one with first hand experience as one of us…as a knowledge worker.

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Knowledge workers think for a living, but in America, with our Taylor based management system, we’re driven by tasks and overburdened. So, when do we find time to think? I often cite Peter Senge’s book the Fifth Discipline. In the opening chapter he cites a conversation with a colleague that talks about the differences between Japan and America’s relationship with time.

In Japan they respect thinking and they see time as a friend. And they use the time constructively. In America, overburdened, we see time counting down as the enemy and we hurry through activities and hurry through our days.

In Japan if someone approaches somebody sitting quietly at their desk they assume they are thinking and they go away so they don’t interrupt the flow of thought. Because they respect time and it’s not an enemy, they move gracefully from desk to meeting place and it’s an appropriate venue to be interrupted and have a conversation in transition.

We scurry from meeting to meeting and deflect conversations in a sense of self-importance, so when people see us quietly sitting at our desk they think “oh good, I’ve caught him or her” and interrupt our thinking.

The Japanese thinking includes a concept called Hansei, which is generally translated as reflection, but is really a critical self analysis — looking at their own behaviors, thoughts, and actions; and determining if any of them should be improved.

For us that’s a foreign concept, no pun intended, because we live in an environment that still uses fear as a management tool. It makes us defensive. And, when we’re defensive it makes us focus on external factors.

The Japanese system is based upon Deming’s theories. It promotes thinking and reflection. Those are the basis of learning. And what is more important in a knowledge worker environment than learning? Think about it…if you can find the time.

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I love basketball. In fact, my three sons all play. Two of my son’s teams have/had completely different cultures. One son’s team looked to win the game, but spend the minimum amount of energy they need to win. The other son’s team goes all out the whole game, fully investing in the game, in an attempt to win.

Product development is an investment. Although it is often managed and viewed as a something that needs expense management. In product development we have the classic tradeoffs. Phillips Corporation has a very nice way of prioritizing these tradeoffs. They call it QTF$. Quality — It’s the first tradeoff, but it’s not really a tradeoff. You have a quality threshold your product needs to meet, and there’s no negotiation about that. The other three, TF$, stand for Time, Functionality, and Cost. Time is the second most important of the tradeoffs. If your product is delivered on time, it positively impacts your entire customer base. If you withhold some Functionality to get the product out on time, it will negatively impact some small section of your market that relies on that functionality. If Costs are overrun; if the cost of the project or the build cost of the project itself fail to hit the target and go over, that effects you internally and doesn’t affect your customer base. So Phillips, from the standpoint of serving the customer, ranked order of the tradeoffs as QTF$.

Time is king and yet we get hung up on costs. We bring our classic business short-term focus to the system, product development, that’s concerned about growing our future. If you’re familiar with the work of product development guru Don Reinertsen, then you’re probably familiar with his theory of the cost of delay. On-time is the greatest lever for optimizing the return of investment in product development. Expense management in projects should be about measuring costs, not about squeezing them.

We recognize the investment nature of product development in our portfolio management where we require predictive ROIs. But how many of your companies follow through and actually check your investment by measuring the S-curve for your return. Very few, at least in my experience, because we are bound by linear process thinking, which ends as the project ends, as opposed to closed-loop systems thinking, which goes back and checks the results of our actions.

So of my two boys…the one who played on the team with a culture to conserve energy, they had a player who now plays in the NBA. None-the-less they lost as many games as they won. The team that goes all-out, they don’t have any NBA caliber players on that team. In fact, the best player on that team will play in Division 2 college ball next year, and yet that team wins five times as many games as they lose and they’re currently ranked #7 in the state.

When you make an investment, fully commit to the investment. The investment in product development is most carefully managed, and gives it’s greatest return, when you focus not on costs and expense, but rather on time.

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Peter Drucker, the recognized management guru of the 21st century, talked about Knowledge Workers in his final work. Specifically he addressed the requirements for increasing productivity among knowledge workers; which ultimately is EAC’s goal – increasing productivity within product development.

To increase product development productivity there needs to be a focus on quality of output. Drucker contends that the quality of output is as important, and perhaps more important, than the quantity of output. If you find a mismatch between informational needs of somebody doing work and the information that arrives with them, then you have a problem. If that’s the case then the thing to do is take this problem, raise a flag, and move into the Continuous Improvement subsystem, which we will discuss separately. It is a critically important one of the three subsystems of The Product Development Operating System.

Also, please reach out to us if you are finding a wide gap between information needs and availability. We offer the tools and services you may need to close that gap and move to a better position.

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