Showing posts with label management. Show all posts
Showing posts with label management. Show all posts

Wednesday, February 3, 2016

Flip Flops

I get a bit tired of candidates accusing each other of "flip-flops."

I suppose no one remembers Ralph Waldo Emerson, who penned perhaps the last word on the subject:“A foolish consistency is the hobgoblin of little minds, adored by little statesmen and philosophers and divines. ”

― Ralph Waldo Emerson, Self-Reliance

Mahatma Gandhi also touched on the subject; he often changed his mind publicly. An aide once asked him how he could so freely contradict this week what he had said just last week. The great man replied that it was because this week he knew better.

--- Gandhi

"When the facts change, I change my mind. What do you do, sir?"

--- John Meynard Keynes

Monday, May 25, 2015


“Responsibility is a unique concept... You may share it with others, but your portion is not diminished. You may delegate it, but it is still with you... If responsibility is rightfully yours, no evasion, or ignorance or passing the blame can shift the burden to someone else. Unless you can point your finger at the man who is responsible when something goes wrong, then you have never had anyone really responsible.”
― Hyman G. Rickover

Saturday, April 4, 2015

Dr. Strangelove, Andreas Lubitz and General Jack D. Ripper

We learned soon after the Germanwings crash that it appeared to have been intentional.

The movie Dr. Strangelove immediately came to mind.

In the movie, US Air Force general Jack D. Ripper, undergoing an apparent mental health crisis, launched a first strike attack on the Soviet Union with disastrous consequences.

The movie was a black comedy, but was viewed by some experts as "a documentary," in that it depicted very realistically a scenario of what could happen if one demented individual were to take over the procedural machinery of launching a nuclear attack.

In the movie, General Ripper made use of a "safety" procedure to allow a retaliatory strike even if the central command authority had been destroyed.

That's exactly what Andreas Lubitz did, making use of the safety device designed to keep hijackers out of the cockpit.

In the real world of nuclear weapons control, there were two control mechanisms in place to prevent unauthorized release of nuclear weapons: (a) the Personnel Reliability Program (PRP) and (b) the two-man rule.

The PRP identified every person with a role in the handling and release of nuclear weapons. Both personnel and medical records were flagged so that administrative and medical personnel were aware of the PRP members. Medical personnel were expected to take immediate action to bring any such person going through a mental health crisis to attention of the command. No worries about privacy. Too much at stake.

It appears that Lufthansa and Germanwings had no such program. Plainly, passenger safety must override any concern for privacy of pilots and other flight deck personnel.

It also appears that Lufthansa had no rules prohibiting a single person in the cockpit in a position to crash the aircraft. This needs to be changed immediately.

Friday, January 30, 2015

On Changing One's Mind

A foolish consistency is the hobgoblin of little minds, adored by little statesmen and philosophers and divines.
Ralph Waldo Emerson

"When the facts change, I change my mind. What do you do, sir?"
John Maynard Keynes
Mohandas K. Gandhi often changed his mind publicly. An aide once asked him how he could so freely contradict this week what he had said just last week. The great man replied that it was because this week he knew better.

Sunday, April 6, 2014

What Is A Robber Baron?

A little etymology is in order.  Fortunately, Timothy Taylor in his blog "The Conversable Economist" saves us the trouble of poring over the archives.

He explains the origin of the term in the Middle Ages here and provides some helpful examples from Nineteenth Century oratory using the term in very descriptive ways.

Where are the orators of our day?

W.C Flagg, president of the Illinois State Farmer's Association, was such an orator in his day. He explains the results of the Robber Barons' in the field of transportation: "There-by you, the citizens of a democratic-republican country, are enabled to know how cruel, relentless, and unscrupulous a thing is arbitrary power in the hands of a few. Regulation by combination means that the railroad managers are feudal lords, and that you are their serfs."

An 1870 article in Atlantic Monthly draws a picture that seems all too familiar today:

"They make money so rapidly, so easily, and in such a splendid sensational way, that they corrupt more persons by their example than they ruin by their knaveries. As compared with common rogues, they appear like Alexander or Caesar as compared with common thieves and cutthroats. As their wealth increases, our moral indignation at their method of acquiring it diminishes, and at last they steal so much that we come to look on their fortunes as conquests rather than burglaries."

The article might have been referring to the practice of high frequency trading, where margins of time in microseconds result in vast stock trading fortunes as described this week in the New York Times. In times past, such people were also described as parasites. 

Monday, February 24, 2014

American CEO's Are Forty Times As Productive As German CEO's

American CEO's Are Forty Times As Productive As Germans

At least that is what one might assume from the above graphic. That is, if you believe that capitalism dispenses rewards in a rational and proportional manner.

Then there's this:

Who was Tesla? He invented and designed the entire infrastructure to distribute electricity by alternating current, generate it more efficiently using the Tesla turbine, and invented radio. He had to fight all those "job creators" like Thomas Edison and Guglielmo Marconi to get his ideas adopted.

Friday, January 4, 2013

On Cabals

Some years ago, then-First Lady Hillary Clinton asserted that a "vast, right-wing conspiracy" had targeted her husband, President Bill Clinton.

In today's New York Times, columnist Timothy Egan stimulated a better word: "Cabal." I like "cabal" for the purpose. Cabals don't have to be vast in order to be effective.

Wikipedia explains: "A cabal is a group of people united in some close design together, usually to promote their private views or interests in a church, state, or other community, often by intrigue." Wikipedia elaborates: "The term can also be used to refer to the designs of such persons or to the practical consequences of their emergent behavior, and also holds a general meaning of intrigue and conspiracy. The use of this term usually carries strong connotations of shadowy corners, back rooms and insidious influence; a cabal is more evil and selective than, say, a faction, which is simply selfish; because of this negative connotation, few organizations use the term to refer to themselves or their internal subdivisions."

Egan didn't use the word "cabal" in his column. Instead, he referred to "a knot of Tea Party extremists who will never consider a fresh idea and a House Speaker whose notion of compromise is to tell his Democratic counterpart in the Senate to commit an unprintable act. For John Boehner, his profane shout-out to Harry Reid passed for a New Year’s toast." It was one of Egan's readers who suggested that "cabal" is a better word than "knot" for the phenomenon.

I agree with the reader. For many years now, a small group of extremely wealthy individuals, most of whom got their money the old-fashioned way  (they inherited it) and who don't actually make anything but deals, have put their extreme wealth on the scales to change the rules that served the country well until the early seventies.

These are people who show nothing but disdain for Americans who actually work for a living. And they have proven adept at using intrigue to take resources from workers to line their own pockets.

That's the real story behind the "giant sucking sound" candidate Ross Perot talked about twenty years ago. Not the giant sucking sound of jobs fleeing to Mexico but of capital and jobs fleeing to China and India.

How can American workers (of all different-colored collars) counter  this trend?

Get smart! Vote for jobs.

When everyone is back to work, get control over the banks and other financial institutions.

Uncloak the cabal.

Wednesday, December 12, 2012

Another Interesting Post On Technology, Jobs And Salaries

Here is an interesting post by economist Tim Taylor, reposted by Mark Thoma.  It addresses issues of manufacturing productivity and suggests the only bright spot is computers. And that sector isn't doing much for jobs. Capital rather than labor scarfs up the profit.

I think this fits in with my previous post on technology, jobs and salaries. Taylor's post clarifies many of the issues involved in assessing manufacturing productivity. The picture may not be as rosy as government statistics indicate. Taylor explains: "Our statistical agencies try to measure price changes, but they miss them when the price drops because companies have shifted to a low-cost supplier. So because we don’t catch the price drop associated with offshoring, it looks like we can produce the same thing with fewer inputs—productivity growth. It also looks like we are creating more value here in the United States than we really are."

"Suppose," Taylor explains, "an auto manufacturer used to buy tires from a domestic tire manufacturer. Then it outsources the purchase of its tires to, say, Mexico, and the Mexicans sell the tires for half the price. That price drop—when the auto manufacturer switches to the low-cost Mexican supplier—isn’t caught in our statistics. And if you don’t capture that price drop, it’s going to look like, in some statistical sense, the manufacturer can make the same car but only needs two tires."

Figures don't lie....

Saturday, November 24, 2012

Hostess Demise

Michael Hiltzik, writing in the Los Angeles Times, makes it pretty clear that Hostess' problems were caused by management, not the unions.

This should come as no surprise to anyone who has studied W. Edwards Deming's insights into quality control. He attributes 85-90 percent of quality control problems in any enterprise to management, rather than workers.

It is clear from Hiltzik's summary, citing chapter and verse, that Hostess' problems could have been resolved long ago by exercising quality control. Instead, they rewarded their top level magement and raided the pension funds.

It's an all too common story.

But it helps keep up the income share of the top decile.

And then there's this observation.

Wednesday, September 12, 2012

Aleksei Grogorievich Stakhanov - Hero of Socialist Labor

In August, 1935 Soviet newspapers reported that a twenty-nine year old miner, Aleksei Grigorievich Stakhanov (Алексе́й Григо́рьевич Стаха́нов) in the Donbass region mined 102 tonnes of coal in five hours, forty-five minutes. The output was fourteen times his quota. Less than a month later, he mined 227 tons in a single shift.

These heroic accomplishments were held up as a model for others to follow. Workers who exceeded their quotas were known as "Stakhanovites." The movement inspired others to follow suit. The government's goal was to exhort individuals to ever greater efforts at productivity.

Several curious things about the Stakhanovite movement.
1. The Soviet Union had just completed a bloody collectivization campaign, collectivizing every industrial and agricultural activity, yet Stakhanov's accomplishment was to exceed a personal, piece-work goal;
2. Central planners also established output goals for enterprises, but managers apparently saw no way to achieve those goals except to prod individual workers;
3. Central planners were heavily engaged at the time in mechanization of production, but management methods followed pre-revolutionary hierarchical and authoritarian models of management;
4. Management focus was on gross output, not quality;
5. Exhortation was a major instrument of motivation - this instrument almost never works well;
6. Seeds of later failure of the Soviet economic model were sown in the late twenties and early thirties.

My main conclusion: Soviet economic shortcomings resulted from poor management methods - methods handed down from at least the time of Peter the Great.

The failure of the Soviet Union as a political system, however, stemmed from the difficulty of incorporating more than 120 nationalities, with as many languages and at least that many cultures.

It was a pretty impossible task. The breakup of the Soviet Union has not completely played out to this day.

Though the experiment failed, it accomplished some amazing things.

Friday, September 7, 2012


The style is unmistakeably "socialist realism."  In the National Review? A blatant copy of a Soviet poster (rolled up sleeves and all) declaring that "The Union of Soviet Socialist Republics is the Socialist Government of Workers and Peasants."

Pretty heroic pose. What gives? A resurgence of Stakhanovites? Thanks to for the connection.

Pretty curious. I have some thoughts, having to do with the real reason for the demise of the Soviet Union and the role of Soviet management style.

Stay tuned.

Wednesday, March 14, 2012

General Prosperity Or Particular Prosperity?

Along the same lines as yesterday's post by Robert Reich is an interesting examination of why business leaders aren't calling for economic stimulus. As this article points out, in the 1940's business leaders joined together to press for a substantial federal stimulus to protect against a postwar depression.

It worked.

Even in an earlier period, Henry Ford recognized that if his workers couldn't afford to buy his products, his factories wouldn't prosper. So he paid well and prospered greatly himself.

But in today's world, executive compensation is divorced from the overall performance of the economy. For that matter, it seems divorced from executive performance in any normal sense.

This needs attention.

Saturday, January 28, 2012

Bonaparte's Retreat

OK, it wasn't Bonaparte. It was really the Board's retreat, but that doesn't have quite the same ring.

Liz and I spent the past two days as members of the public attending the Oriental Town Board's retreat at River Dunes. The big news was disclosed early on the first day, when we learned the details of Mr. Chris Fulcher's proposal to exchange the end of South Avenue with a nearby site already dredged, with pilings for a pier already installed, and the site bulkheaded. It is a very interesting proposal, which merits careful study.

More importantly, it soon became clear that the town manager, Mr. Bob Maxbauer,  has initiated an ambitious program of identifying, prioritizing and planning projects for improving the Town. The purpose of the retreat was principally for the manager to brief the town board and seek policy guidance before proceeding further. It appears likely that the Town will schedule more detailed workshops to flesh out specific plans.

We have a manager! Details to follow.

Monday, January 23, 2012

Politics And Leadership

Divide and rule, the politician cries; unite and lead, is watchword of the wise.

Johann Wolfgang von Goethe

The iPhone and America's Discontents

Yesterday's New York Times had a very informative article focused on why iPhones are made in China, not in America. And the answer is, it isn't just about price.

The article explains: "It isn’t just that workers are cheaper abroad. Rather, Apple’s executives believe the vast scale of overseas factories as well as the flexibility, diligence and industrial skills of foreign workers have so outpaced their American counterparts that “Made in the U.S.A.” is no longer a viable option for most Apple products."

In short, at least in Apple's case, it is about quality. And continuous improvement.

For the past two decades, Americans have been misled by a chorus of triumphalist pronouncements about the decline and fall of the Soviet Union. "See," we are told,"communism failed. It can't work. Only capitalism can work, everyone knows that."

Is that so? The last time I checked, the People's Republic of China had a communist government.

So how come they are taking over production of our goods from our industries?

I think they have been paying attention not to the thoughts of Mao, but to the thoughts of W. Edwards Deming.

Read the New York Times article.

I'll share more thoughts later.

Tuesday, October 4, 2011

Oriental Town Meeting October 4, 2011: Rainy Day?

Bizarre town meeting tonight. Only four commissioners present (Commissioner Styron was absent).

After an interminable discussion of minutes, the board considered a request by the town manager to amend the budget. Purpose: to appropriate funds to pay bills incurred and projected for hurricane clean up and remediation, including mosquito control. When two commissioners pointed out that there are still unexpended funds in the budget, the manager explained that he has no authority to expend those funds for any purpose other than the authorized line items. Except for hurricane expenditures, the approved budget is being implemented with no problems. He further explained that hurricane expenditures will be reimbursed 75% by FEMA and 25% by the State of North Carolina. The purpose of the amendment is to allow the town to pay its bills before FEMA and state reimbursements are received.

"Well what if they don't reimburse us?" Commissioner Johnson asked. "I'm worried that the Oriental taxpayers will be stuck with the bill."

After reiterating that he has negotiated the details both with FEMA and the state and explaining that he is carefully establishing a project number for each job, following FEMA guidelines, the manager posed a key question. Suppose there were no FEMA and no funds from the state. Is there anything the town is doing (debris pickup, mosquito control, etc.) that the board wouldn't want the town to do anyway. He received no answer.

The board rejected the motion to approve the budget amendment.

Commissioner Johnson then introduced a new motion to approve a smaller amount than requested for hurricane debris pickup and for mosquito control.

A similar series of actions first rejected a requested amendment to the water fund, and then approved a lower amount than requested.

"Oh, we don't want to dip into the reserve fund," Commissioners Johnson, Roe and Bohmert explained.

In many states, the reserve fund is known as the "rainy day fund."

We just had a very rainy day (Irene) and the health and welfare of the residents of Oriental are seriously threatened. And our commissioners want to dither about whether to pay for contracted services for which we will be reimbursed.

Looks like tonight was another rainy day at the meeting.

Thursday, September 1, 2011

Good Bye Irene, Don't Darken Our Door Again

Things slowly getting back toward normal in Oriental. Only thing lacking is DSL Internet connectivity from Century Link.

Everything else: Water, Electricity, Phone, working normally.

Kudos to Progress Energy. We had power back in the heart of Oriental Monday evening, a little less than 72 hours after the lights went out Friday night. Power poles were down all over the county. Don't know how they did it, but one thing is clear - teamwork and cooperation were impressive.

And kudos for the gang at Town Hall, especially the public works department. We did lose water for a few hours, but had it back even before the power came back on.

It was beautiful to see how everyone in the town pulled together. Neighbor helped neighbor. If anyone had something they shared it with others. Bama Deal's pot lucks under the tents were a great way to get together and cook up people's food before it had to be discarded. People shared generators, cookers, propane and labor.

That's what community and cooperation are all about.

It's great to live in a community like Oriental.

Monday, July 18, 2011

Town of Oriental Referendum 1993

The North Carolina Legislature in its 1991 session passed An Act to Set a Referendum on Possible Changes in the Electoral System for the Town of Oriental (Chapter 878, Senate Bill 968). That act is posted on the Town of Oriental's web site at pages four and five of "town charter and amendments" under General Ordinances and Town Charter. The 1991 act scheduled a referendum for a special election to be held November 3, 1992.

Anyone reviewing the 1991 Act can see immediately that each of the three choices to be presented to the voters begins: "(a) Sections 3 and 7 of Chapter 184, Private Laws of 1899 (the original 1899 charter) are repealed."

Section 3. of the 1899 charter stipulates: "That the officers of the town shall be a mayor, three commissioners, a constable, who shall be elected by the commissioners, and such other officers as the commissioners may deem necessary and proper, as provided by said chapter sixty-two of The Code [of 1883]; Provided that no person shall be a mayor, commissioner or other officer of said town unless he be a qualified voter therein."

Before the special election was held, the state legislature passed "An Act to Make Technical Corrections to a 1992 Charter Amendment to the Town of Oriental, and to Reschedule a Referendum. The act rescheduled the referendum for November 2, 1993, modified option B to provide for a five-member rather than a six-member board and stipulated that whichever choice received a plurality of votes would go into effect beginning with the 1995 regular municipal election. That act is not posted on the town's web site, but is posted on the web site of the North Carolina Secretary of State.

The Pamlico County Board of Elections conducted the referendum at the same time as the November 2, 1993 municipal election. Sherrill Styron was elected mayor with 265 votes. Commissioners were Radford Lewis (265 votes), Joe Harris (249 votes), and Dave Nelson (185 votes). A plurality of voters voted for question 'C', a mayor and five member board of commissioners with the mayor voting only in case of a tie (218 votes). Question 'A', keeping a three-member board received 73 votes and question 'B', a five member board with the leading vote getter serving as mayor, received 69 votes.

The Pamlico County Board of Elections retains a copy of the abstract of canvassing (the vote count) for that election, as well as a copy of the ballot used for the election.

The 1993 repeal of sections 3 and 7 of the 1899 charter had no immediate effect. The town continued to have a "mayor-council" form of government, which gave the board of commissioners as much operational control of day to day operations, including hiring, as the board wanted to exercise. But in 1997, the town amended the charter by ordinance, changing to a "council-manager" form of government. Under that form, the commissioners have no day to day administrative powers - only the right to establish general policies and exercise general oversight.

North Carolina General Statutes establish the duties and responsibilities of the manager by law.

Thursday, June 30, 2011

Oriental Town Commissioners and Management

Some Oriental Town Commissioners seem to have great difficulty grasping the proper role of the board of commissioners. Let's try again.

The Town of Oriental has a council-manager form of government. That means the board of commissioners exercises a legislative role by providing general direction and control over town government, adopting general personnel rules, regulations, policies or ordinances and providing oversight over the Town Manager's activities.

The Town Manager is the chief administrator of the town. He is responsible to the board of commissioners for all municipal affairs. His powers and duties are spelled out in North Carolina General Statutes.

The manager supervises and directs all departments of Town Government, including appointing, suspending or removing ALL city officers and employees not elected by the people (subject in some cases to other provisions of the law).

In brief, the town board gets to hire the town manager. The board has NO statutory authority to hire or fire any employee subordinate to the manager. To be sure, the board can establish general personnel rules, regulations and policies.

Commissioners have NO operational role in the town's administration. No supervisory role and no authority over employees. No individual commissioner has any administrative or disciplinary authority over the manager or any other employee. Neither does the mayor.

We saw at today's agenda meeting the sort of problem that can arise when an individual commissioner takes on the task of obtaining cost estimates, "bids," making design decisions, and attempting to move forward with a project instead of asking the entire board to task the manager with the project. In this case, the project that seems unnecessarily muddled is the pier at the end of South Avenue.

There have been other matters unnecessarily muddled by commissioner meddling in the past year and a half.

The board needs to address this. It is a procedural issue.

Tuesday, June 21, 2011

Can Americans Make Anything Besides Deals?

Interesting column by Harold Meyerson in last week's Washington Post.

The question Meyerson addresses is whether the United States can learn from the example of others - in this case, Germany. The first part of the question is whether there is anything to be learned from other countries. Clearly there is.

The second part of the question is whether we are capable of learning from the successes of other countries. That's an open question.

Meyerson comments on the German model: "German manufacturers, particularly the midsize and small-scale ones that often dominate global markets in specialized products, don’t seek funding from capital markets (there’s a local banking sector that handles their needs) and don’t answer to shareholders. They make things, while we make deals, or trades, or swaps."

David Leonhardt, the New York Times economics columnist, wrote last week that Germany owed its edge in global competitiveness to a range of policies that could not be more different than ours: limiting home ownership, improving education (including vocational and technical education) and keeping unions strong — which is why “middle-class pay,” he noted, “has risen at roughly the same rate as top incomes.”

The German model differs from the laissez-faire approach to globalization that has dominated U.S. policy and discourse for decades, dooming many American workers to penury. Meyerson's article emphasizes the crucial distinctions between Germany’s stakeholder capitalism, which benefits the many, and our shareholder capitalism, which increasingly benefits only the few.

Can we learn from others? Let's give it a try.Link