In Alan G. Robinson and Dean M. Schroeder’s book Ideas Are Free: How the Idea Revolution is Liberating People And Transforming Organizations (2008) there is this passage on managerial humility:
“In a famous essay, Friedrich Hayek, founder of the Austrian School of Economics, articulated why employees often see problems and opportunities that their managers do not. In writing about decision making in organizations, Hayek divided knowledge into two types: aggregate knowledge and knowledge of the particular circumstances of time and place. Managers usually deal with the first kind of knowledge—things like “Sales are off 10 percent” or “Costs went up 5 percent.” The higher a person is in an organization, the more aggregated his or her information tends to be. While aggregate knowledge is important for understanding general relationships and formulating broad strategies, it is not very useful for coming up with specific performance improving ideas. These come primarily from the second kind of knowledge that Hayek discussed—the detailed knowledge of particular events, day-to-day problems and opportunities, and how things are actually done. This is exactly what employees tend to possess and why they can often come up with better ways to meet organizational goals than their managers can.”
Annotation : I remember one time when NSC was on a cost-reduction a year prior to its closure, rank-and-file supported the corporate’s thrust to reduce cost by initiating small cost reduction schemes that led to higher savings than across-the-board measures.
Robinson and Schroeder also noted that there is the importance of small ideas, the problems of rewards, making ideas as central part of work, making change easy, drawing attention to what is important, and helping employees see beyond the obvious. What was telling here was the one regarding rewards:
“A poorly designed reward scheme can also interfere with the free flow of ideas in more nefarious ways. It can give rise to unethical behavior, as managers look for ways to save money on rewards they owe, and workers look to “game” the system for higher payouts. . . As the saying goes, “If money can be made by doing something wrong, someone will.”
Annotation : Maybe somebody forgot this one when they devised the GSPI’s reward system to popularize TPM. Each kaizen generated, a set of number of fuguais identified, or a JH step completed were offered with equivalent monetary reward. In the long-run, however, the money budgeted for this scheme dried up, while some employees made it their prime activity of the shift that some forgot their very own jobs.
“When managers first realize the value in the ideas of their employees, it is a profoundly liberating experience. When they learn how to go after these ideas, they also learn that it is well worth the time and effort. Ideas are free. Employees become allies in solving problems, spotting opportunities, and moving the company forward, to the benefit of all. And when managers decide to let their employees think alongside them—and no longer seek to go it alone—they will have joined the Idea Revolution.”
Annotation : This is the basis of innovation. When people pool ideas, thus collaborate, there is much more greater rewards than by doing it alone. No one has the ultimate franchise of creating ideas, each of us are capable of doing them.
This calls to mind one of the key concept of Desiderata which states, “Even the dull and the ignorant, they too have their stories.”
Annotation : I guess ideas come from those stories, as well.
Notes:
Robinson, Alan G. and Dean M. Schroeder (2008). Ideas Are Free: How the Idea Revolution is Liberating People And Transforming Organizations. San Francisco, CA: Berrett-Koehler, John Wiley & Sons, 2005. p. 9, 18 back to text
Disclaimer: The posts on this site does not necessarily represent any organization’s positions, strategies or opinions; and unless otherwise expressly stated, are licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Philippines License.
The Grey Chronicles
Managerial Humility
Tags: Aggregate Knowledge, Alan G. Robinson, Change, Collaborate, Cost Reduction, Dean M. Schroeder, Desiderata, Fuguai, Humility, Idea, Idea Revolution, Ideas Are Free, Innovation, Kaizen, Manager, Organization, Reward, TPM
Annotation : I remember one time when NSC was on a cost-reduction a year prior to its closure, rank-and-file supported the corporate’s thrust to reduce cost by initiating small cost reduction schemes that led to higher savings than across-the-board measures.
Robinson and Schroeder also noted that there is the importance of small ideas, the problems of rewards, making ideas as central part of work, making change easy, drawing attention to what is important, and helping employees see beyond the obvious. What was telling here was the one regarding rewards:
Annotation : Maybe somebody forgot this one when they devised the GSPI’s reward system to popularize TPM. Each kaizen generated, a set of number of fuguais identified, or a JH step completed were offered with equivalent monetary reward. In the long-run, however, the money budgeted for this scheme dried up, while some employees made it their prime activity of the shift that some forgot their very own jobs.
Annotation : This is the basis of innovation. When people pool ideas, thus collaborate, there is much more greater rewards than by doing it alone. No one has the ultimate franchise of creating ideas, each of us are capable of doing them.
This calls to mind one of the key concept of Desiderata which states, “Even the dull and the ignorant, they too have their stories.”
Annotation : I guess ideas come from those stories, as well.
Notes:
Robinson, Alan G. and Dean M. Schroeder (2008). Ideas Are Free: How the Idea Revolution is Liberating People And Transforming Organizations. San Francisco, CA: Berrett-Koehler, John Wiley & Sons, 2005. p. 9, 18 back to text
Disclaimer: The posts on this site does not necessarily represent any organization’s positions, strategies or opinions; and unless otherwise expressly stated, are licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Philippines License.
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