Ethical Decision-making in Business Operations

ethics-cross the finger

Last week, we had a special guest come to our MBA class. Rev. Anthony Rodgers, author of How God Restored My Life, shared with us his personal story that showcased a lifestyle of prestige, power, and wealth.  However, this pathway was through illegal and criminal behavior that the average individual would find distasteful.

Rev. Rodger’s was transformed; his life has become a symbol of how individuals can be redeemed and changed.  His lifestyle of drugs and crime are demised.  In the same vein, some business managers act immorally, unethically, and participate in illegal activities that can get organizations into trouble.  Do you remember Enron?  BP Oil?  There is a laundry list of these organizations.

If organizations are serious about having profitable operations, they must have good ethical systems.  Operations management does not exist in a vacuum; other business areas must be considered. Marketing and strategy are underlining principles that must be addressed for organizations selling abroad.

Michael Johnston and Greg Marshall, authors of Relationship Selling, argue that customers who reside in other countries pose unique ethical concerns for salespeople and management, especially in (1) cultural differences and (2) differences in corporate selling policies.[1]

Regis McKenna, author of Relationship Marketing, further suggests that effective marketing is the integration of the customer into the design of the product; to design a systematic process for interaction will create substance in the relationship.[2] Creating a good ethical system is critical for success.

First, any meaningful, ethical program must start with senior management behavior. In fact, ethical behavior must start at the top. Salespeople are not the only members of the sales force who face ethical concerns. Management must address significant ethical issues with (a) salespeople, (b) company policies, and (c) international customers and policies.

I do think that organizational culture is the cornerstone for understanding the ethical environment. Trust is the foundation of any meaningful corporate structure.  Gareth Jones and Jennifer George, authors of Contemporary Management, maintain that when leaders are ineffective, chances are good that workers will not perform to their capabilities.

Johnston and Marshall further suggest senior management style (do their actions match their words), the established culture of the organization, and external forces can create a climate where unethical or even illegal behavior is tolerated.[3] Therefore, senior managers should lead the way by example.

Second, the organization must evaluate the current corporate culture. There are both written and unwritten rules and behaviors that come into play. For example, Enron senior management demonstrated a lack of moral and ethical judgment that played a critical role in its decision-making (i.e. breaking laws) policies.  Therefore, one must review the organizational culture of the organization before attempting to implement an ethics program.

Last, the organization must be committed to a win-win approach. Companies need to have a plan for implementing ethics. However, these plans need to involve the workers. Typically, executives come up with a mandate on corporate policies and HR is forced to implement them.  There is little worker involvement.

Yet, ethical conduct impacts everyone.  Employees at various levels face ethical issues all the time. Their input would be invaluable. This fact has a great bearing on ethical behavior among employees.

Discuss your professional experience on how ethical decision making can impact business operations.

 © 2013 by Daryl D. Green


[1] Relationship Selling by Michael Johnston and Greg Marshall

[2] Relationship Marketing by Regis McKenna

[3] Contemporary Management by Gareth Jones and Jennifer George

Advertisements

Transformational Properties of Operations Management

Manufacturing-factory-China

Last week, I ran into an old friend at the Oak Ridge Post Office. He was a retired professional who I had played noon basketball with in my early years in Oak Ridge. He mentioned that most of the guys had retired from their jobs.

However, he also mentioned that one of the most seasoned professionals had been laid off from this prestigious firm after working for this organization more than 20 years. It was noted that the work had dried up. In fact, most of the local businesses are seeing the budget tightening in the government sector which is critical to the survival of most businesses in the area. Sadly, the financial crisis is not over.

Globalization will continue to drive down prices and force businesses to make hard decisions which impact the basic quality of living. Companies will look to operations management to gain greater efficiency and effectiveness in their systems.

The underpinning thread is how they understand value creation and what it means to customers. In this context, value can be defined as the perceived experience and worth gained from a product or service.[1] Creating value is not easy. Creating value across an international base is almost impossibility for most companies. Therefore, understanding operations management and supply management is a necessity.

Global markets continue to shift the direction of today’s businesses. Companies must be astute to the ever changing value perspectives of customers. According to KPMG 2013 Global Manufacture Outlook, companies should be optimistic. This international report surveyed 335 senior executives in five industries: Aerospace and Defense, Automotive, Conglomerates, Engineering and Industrial Products, and Metals.[2]

KPMG notes, “Global manufacturers’ ability to optimize performance and cost in their entire supply chain will be key to helping them become more competitive and resilient…Global manufacturers are building closer relationships with their customers, who in turn expect more due to advances in manufacturing technology.” These organizations are seeking a competitive advantage in several ways:

  1. Increasing transaction activity to take advantage of growth opportunities in global markets, while reassessing operations and product portfolios to control costs.
  2. Viewing their ‘channel partners’ as more of a network and building closer working relationships with their suppliers and other partners to maximize responsiveness to changes in the market. More effective and efficient collaboration enables them to optimize inventory, logistics, and other operational costs.
  3. Improving visibility in supply chain optimization provides a major opportunity for many companies to boost performance, agility, and resilience.
  4. Increasingly placing the supply chain at the center of their strategies to innovate, as they begin to look at suppliers not just as a source of production and logistics but also of ideas.
  5. Investing in breakthrough and incremental innovation to stay competitive. Nearly a third of respondents whose firms are stepping up R&D say their company will invest in breakthrough innovation.

Individuals as well as organization must understand the transformation properties of operations management.  Transformation processes relate to utilizing resources to convert inputs to desired outputs.

For example, automobile manufacturers convert primary inputs (i.e. sheet metal, plastics, engine parts) into a desired output (i.e. high quality cars). Yet, products are not the only thing that has a transformation process. Services also follow this paradigm. In the hospital industry, primary inputs (i.e. patients) create a desired output too (i.e. healthy patients).

Robert Jacobs, Richard Chase, and Nicholas Aquilano, authors of Operations & Supply Management, argue the merits of well-constructed organizational systems, especially during global competition: “Transformation processes are used in all types of businesses…Operations and supply management is about learning how to design these transformation processes.” Companies that understand what customers want and the intrinsic value desired by them will need to effectively retool their transformation processes in a cost effective manner.

 

According to the Economic Policy Institute, there are roughly 5.1 fewer American manufacturing jobs than at the start of 2001.[3] In fact, organizations argue that American worker’s wages have tumbled due to China’s cheap labor (i.e. primary input in the transformation process).

Global competition demands that organizations focus on the ‘small stuff’ as well as the big picture and embrace the attractive properties of operations managements.

Discuss the concept of operations management for today’s organizations.

© 2013 by Daryl D. Green


[1]Relationship Selling by Johnston & Marshall

[2] KPMG 2013 Global Manufacture Outlook

[3] “Report: America lost 2.7 million jobs to China in 10 years” by Danielle Kurzleben

Demising the American Living Wage

Are you worried about your children and grandchildren’s future in terms of a better life?  You should be!  Market forces will make it harder for individuals to make an honest wage.  American companies, once loyal to their employees, have abandoned the social contract with their employees.  

Leaving today’s workers vulnerable to the consequences of globalization.  Thomas Friedman, author of The World is Flat, notes ‘The best companies outsource to win, not to shrink. They outsource to innovate faster and more cheaply in order to grow larger, gain market share, and hire more and different specialists—not to save money by firing more people.”  

Sadly, most companies do not have this long-term perspective about globalization.  In hindsight, globalization may produce a more equitable average wage across the world, while reducing the earning power of developed countries and increasing the living wages for emerging countries.  These realities on living wages are a critical concern for most Americans.  

Since the recession in 2008, U.S. businesses have posted historical profits even while unemployment has risen.  Consequently, the market place is saturated with seasoned individuals who are willing to take massive pay cuts in order to obtain a secure job.  Employers understand that it is a buyer’s market where employers can be picky. This reality has bottlenecked millions of young college grads who must fight for entry level jobs with career veterans.  

According to a Manpower Group analysis, 52% of U.S. employers state they have a difficult time filing positions because of talent shortage.   Peter Cappelli, author of Why Good People Can’t Get Jobs, outlines the hypocrisy of most employers:  “With an abundance of workers to choose from, employers are demanding more of job candidates than ever before.…To get a job, you have to have that job already. It’s a Catch-22 situation for workers—and it hurting companies and the economy.”  Employers are setting unrealistic hiring expectations and offering low wages.  

People, from every country, seek to earn a living to sustain themselves, by taking care of their basic needs.  According to the United Nations’ Millennium Development Report, more than1 billion people on the globe live on less than $1 a day.  

Ironically, as most Americans have watched their wages decrease, most other workers across the globe sees a significant increase.  The world’s middle income class earns between $700 to $7,500 per family member. Consequently, individuals making more than $7,500 are considered part of the global affluent class.   

Some experts argue that globalization has eroded America’s standard of living, especially during the resurgence of manufacturing.  Economist Gordon Hanson notes, “The U.S. has held manufacturing wages in check while there has been strong wage growth in China and moderate wage growth in Mexico.  

With high unemployment and fierce global competition, manufacturing companies has used this fact to their advantage.  This reality has forced two-tier contracts with unions to pay new hires less than existing workers and reduce new hires’ benefits.  In 2010 and 2011, new hires (manufacturing of durable goods) who had three years or more of experience, were paid an average of .3% less than workers in 2007 and 2008. 

Today’s American workers are finding it difficult to make ends meet. According to the Pew Charity study, economic mobility will be more difficult for individuals, especially depending on where they live.  Economic mobility relates to the ability of a person to move up or down the economy ladder.  

The Pew study concluded that people living in Louisiana, Oklahoma, South Carolina, Alabama, Florida, Mississippi, North Carolina, and Texas would be less likely to improve their economic standing.  However, states such as Maryland, New York, and Pennsylvania would have a better chance of economic mobility due to higher wages in manufacturing and public jobs.  

While the poorest American class wouldn’t consider itself part of an affluent class, this relative inequality of incomes is a bitter pill from citizens of poorer countries.  According to an UN study, the poorest countries across the globe consume 14% of the planet’s resources while 20% of the richest countries with the industrialized nations (including the United States) consume 86% of resources.  

Due to globalization, economic mobility will produce a variety of winners and losers.  Consequently, social mobility becomes more difficult as Americans are forced into a caste system of unemployed or underemployed workers. 

What will happen to economic mobility in America? Will the inequality of wages for global workers create new problems for businesses and society at large?                                                                                              

 © 2012 by Daryl D. Green                                    

 


 

Noriko Connects With Japanese Workforce

Reiko Farr & Noriko Chapman pose for new Japanese book.

 There is nothing more flattering to a professor than a student taking his academic advice and being successful.  This situation played out for me with one of my own MBA students this year. However, this week she took it to a different level.  

 For Noriko Chapman, it has created an international collaboration between a local U.S. nonprofit organization and a global leader in the automobile industry which led to the empowerment and economic independence of disabled workers.   

Chapman, who is a DENSO production manager, had worked with the Tennessee Rehabilitation Center (TRC) in Maryville to help increase its operations efficiency as part of her MBA project. In 2009, the Maryville TRC was ranked at eighth in contract sales in Tennessee.

Its mission is to provide services that help lead individuals who have a physical and/or mental disability to employment and are designed to meet individual needs.

However, Chapman’s goodwill had many unintended consequences. She has had four versions of her first book published in one year, which is impressive for a beginning writer. She pledged 30 percent of the book proceeds to this organization. Chapman also helped to restore $75K of government funding to the Center. Chapman became connected to this organization.  She observed, “I was inspired by the staff and by individuals with disabilities who were trying very hard to learn work skills and seek permanent employment.” 

Through her first book, she was able to bring more attention by the media and the public in general to this disability cause. In fact, it landed the TRC’s director an expense-paid visit to DENSO in Japan.

DENSO Corporation, headquartered in Kariya, Aichi prefecture, Japan, is a leading global automotive supplier with customers that include all the world’s major carmakers. With more than 200 subsidiaries and affiliates in 35 countries and regions (including Japan), DENSO had worked to assist the nonprofit organization with a contract that allowed disabled workers to earn income.  In reality, DENSO was offering these workers a second chance. Chapman had made this relationship possible.

For the month of December (2011), Chapman is on an international book tour in Japan with her new Japanese version of her book. She hopes her new book and tour will help women in Japan too: “Japan is a male-dominated society.  Even though the culture is gradually adopting to accommodate female workforce, the career advancement for women in Japan is still limited. The changes are not quick enough to satisfy thousands of bright, hard-working Japanese women.”

Chapman hopes to other corporations and organizations follow in DENSO’s footsteps and help provide second chances to those who need it around the world.

 Please provide your insight on this topic.

 © 2011 by Daryl D. Green                                    

 

Increased Profitability through Value Creation

As I listened to the radio, I couldn’t believe the amount of grid lock in the Washington, D.C. area.  Would both parties be so petty as to bring the nation to the brink of credit default? 

There were many people depending on government official to survive.  I turned the radio station to catch Dave Ramsey, national radio personality, go into a passionate appeal for Americans to take responsibility for their own lives and quit depending on the government. It sparked my attention.  Yet, what Dave Ramsey suggested was no easy matter.  How does an individual turn their ideas into a profitable venue?

Making money isn’t easy! People look for magical equations such as productivity equals outputs divided by inputs.  Decrease your inputs and you can expand your outputs.  Many businesses build their profitability on this simple equation.

Companies seek to reduce their inputs (outsourcing labor, better technologies) to obtain ‘more get.’ Yet, it’s pretty self-serving with little regard to the customer (places less value on employees too). Over the years, I have seen experts suggest that making millions is really easy if you have the right method. 

Loral Langemeier, author of the Millionaire Maker, has created her own version of a Wealth Cycle Process. She notes, “You can make the decision to make a lot of money at any age and in any stage of your life….No matter who and where you are, wealth building is well within your grasp. You just need to step up to the plate.”   Some of these processes may work. Yet, most are only ‘get-rich-quick’ schemes that leave people broken-hearted and empty pocketed!

Chris Anderson on the Long Tail Theory of Selling

Today’s profitability must be built on solving customer’s problems that have a financial value to them. What’s value?  It depends on the individual. Value is defined as the net bundle of benefits the customer derives from a product or service.  Value creation can be defined as an organization’s ability to convey the worth of its product or service to customers. Therefore, it goes to value, which focuses on the relationship between the customer’s expectations of the quality of a product/service quality to the actual amount paid for it. 

Mark Johnston and Greg Marshall, authors of Relationship Selling, argue that understanding customer needs should be the primary objective for profitable businesses.  Therefore, understanding the customer is the center point for creating value.

What has been your experience in turning ideas and concepts into profitable ventures?

 © 2011 by Daryl D. Green

Guest Blogger – Career Opportunities in Operations Management

Prof. Green had asked me if I could write something for the upcoming MBA graduates. I am happy to oblige because, in my opinion, a career in operations management is very exciting and full of opportunities.

There are a few important things to keep in mind as you start searching for a job in the field of operations management. Don’t be hasty Aim to find a job that will give you most responsibility. While the position will come with a learning curve, it will also make you a more valuable employee in the long run.

Let’s examine the following charts from Career Builder to give you a further look into the career of operations management:

Please take a look at the charts, before you read any further. Try to absorb the meaning behind the numbers.

Ask yourself the following questions:

Does education plays a large role in compensation? 

Does experience plays a large role in salary?

What is notable about the industry and compensation graph? 

Take a few minutes to think about these questions and see what hidden information those numbers hold. The ability to read between the lines is one of the most important things that an operations manager can do. This is something you will need to do on a daily basis.

Now that you’ve done the exercise. Let’s delve into it.

First, let’s notice how education gives you a large edge in salary compared to experience in this field. If you are getting MBA or Masters in operations management, you can pat yourself on the back. It would take you 20 years of experience to get a slightly lower salary just by working. This is of course a rough, aggregated date, but what it really says is: education will get you a higher position that will give you a higher salary compared to just getting experience in the field.

Under the ‘Compensation based on Industry’ chart, you can see that between the #1 industry (Health care) and the #6 industry (Aerospace and Defense), the salary gap is $30,000 a year (or  approximately 36% less), just based on one factor: field. All fields are not equal. Making a proper selection of what you want to do in the ops career and focusing your job search on one or two specific fields, is not only smart thing to do, but mandatory.  

I have good news for all of the aspiring operations managers. There’s a very high demand for your services. It is one major in business schools that a lot of people and even students don’t think about or even know about and yet almost every business has a need for it.

 This results in a high demand for operations managers. Unlike finance majors who continue struggling after the crash, demand for operations managers is still growing due to the increasing complexities of supply chain, online logistics, international trade and a number of other factors. The higher the complexity, the more there is a need for a person to make sure that everything runs smoothly.

According to Career Builder’s current statistics, for every 87 job seekers, there are 100 openings in operations management field.  This is a huge discrepancy in supply and demand; especially in the economy we are in, where in some fields there are hundreds of candidates for one position.

As operations managers entering the workforce, you have one of the best job opportunities available to you. This is why you should focus on the field that can get you further, give you the most experience, and will give you the most room to grow. Be aware of what’s happening in the job market.

Follow where the new trends are moving, keep your fingers on a pulse and you will not be disappointed with a payoff in terms of great job and bright career path.

Please comment on this topic and provide the guest blogger with meaningful feedback. 


Artyom Malkov is the author of “Interviews with Masters of Operations Management.” He is one of the founders and the current CEO of OperationsManager.com.

 Artyom has an MBA in Operations Management from New York’s Zicklin School of Business.  When he is not handling the day-to-day business at OperationsManager.com, he consults companies on the best practices and trends in operations management.

Guest Blogger: “Is Real World Application for Real?”

Some MBA students find there is no relevancy in what they learn in class and the practical world. Yes, I was one of these doubters until I was engaged by one of my professors in an operations management course at Lincoln Memorial University.  The end results was assisting a local nonprofit organizations, writing my first book, and being thrust on the expert stage.

Operations management (OM) should be important to nonprofit organizations too. With shrinking funds for programs and a more competitive environment, nonprofit organizations will need to rethink their corporate strategies for future success.

This reality means managing their operations more efficiently and shifting their traditional thinking to a more entrepreneurial approach. Unlike businesses that are driven primarily by profit, nonprofits use any monies earned to be put back into the organization to cover their own expenses, operations, and programs. In 2005, there will be approximately 1.4 million nonprofit organizations registered to the IRS according to “Non-profit market” by Closerware.com.

My OM project called a “Real World Application” project was on the Tennessee Vocational Rehabilitation based in Maryville, Tennessee; it is one of these nonprofit organizations looking for more operational effectiveness in the future.

Tennessee Vocational Rehabilitation is a federal and state-funded program run by the Tennessee Department of Human Services Division of Rehabilitation Services to assist individuals of work age with physical and/or mental disabilities to compete successfully with others in earning a livelihood.

Based on the research data from the 2007 American Community Survey, approximately 12.8% of Americans between the ages of 21 and 64 have a disability.  In Fiscal Year 2009, the Division of Rehabilitation Services provided services to 30,289 individuals in Tennessee and 27,932 individuals met the eligibility criteria of the program. 

It is projected that 30,000 individuals will receive services and that 27,000 individuals will meet the eligibility criteria of the program and receive services during Fiscal Year 2011. Tennessee Vocational Rehabilitation in Maryville supplies automotive parts to Denso where I work. 

 The work usually requires a packaging or simple sub-assembly task while is a training tool for clients to learn work skills and experience. The average training length is 4 months.  However, I found all the staff being occupied with the daily routine and the primary mission of serving the clients. The  staff didn’t have enough time to observe and evaluate its capacity and capability. 

Also, the Center manager was afraid of committing to additional work and contracts due to the unique labor population and the number of clients being fluctuated.  My recommendations were to provide a tool to analyze the capacity frequently and to establish the fine balance of time-sensitive and non time-sensitive jobs to absorb the fluctuations. For instance, the center can prioritize and focus on the time-sensitive jobs for the Just-in-time customer due to high absenteeism.

Working with Dr. Green,  I published my results. My new book, Second Chance, provides nonprofit organizations with information about how to use
operations management tools to make them more efficient and better equipped to assist their clients and constituents in meeting their needs.

Nonprofit organizations like for profit organizations must find innovative ways to compete with others. This includes competing on several dimensions which are (a) cost or price, (b) quality, (c) speed, (d) delivery reliability, and (e) coping with change.   The concepts, theories, tools, technology or reading materials learned in the classroom are not to keep in a closet. 

They are to practice in a real world for an advanced career or a way to help organizations who need the knowledge and expertise. The support can be a time study, data analysis, plotting graphs for visual control, standardized work, material flows, and finally mock interviews for clients who were ready for job placement.

I just had to ask the very last question to a client during a mock interview at the center.  “How did you know about this center?  How did the experience at the center help you prepare for a job?” He answered without any hesitation, “It’s the best thing ever happened to me.  I get up every morning and cannot wait to come here. The experience gave me skills and confidence to find a real job. ”  He also appreciated his mother for finding out the program and encouraging him to pursue.

There are many other individuals with disabilities who can benefit from the service like the client who I interviewed.  How can we optimize the capacity to accommodate more clients without increasing the operation costs? I learned that I can make a difference, using my operational experience.

As a surprising result, I found a practical side of my MBA learning by helping others in the community. If we spend approx. 40 hours per week for a career
job, 2~3 hours a week of investment outside of the work seems to be very little.  However, you will be amazed by the positive impact you can make for the people who need help. 

Don’t underestimate your talent!  It can be fully utilized and appreciated outside of the classroom.  Pursuing a degree is an accomplishment, but we can even capitalize the talent and skills even further by reaching out.  It’s a genuine accomplishment.

© 2011 by Noriko Chapman

Please comment on Ms. Chapman’s points.

 

Noriko Chapman helps social causes as an industry expert.

Noriko Chapman is the mother of two children. She lives in Maryville, Tennessee.  She is a Production Control supervisor in the Instrument Cluster Division of DENSO Manufacturing Tennessee, Inc. She worked at DENSO specializing in production planning, new products start up, service parts operations, supply chain and warehouse operations for 16 years and for 2 years as a full- or part-time translator at the beginning before the first Tennessee DENSO plant was built. Given the fact that she was raised in Japan, she wrote a chapter “Japanese Practices in an Autoparts Plant” for the book, Effects of Japanese Investment In a Small American Community by Scott Brunger and Young-Bae Kim.  Her Maryville College undergraduate research paper, “A Dramaturgical Analysis of Japanese Organization Behavior” won an undergraduate award by North Central Sociological Association.  She is currently attending Lincoln Memorial University MBA program and now serves on the board of directors for the Tennessee Department of Human Services, Division of Rehabilitation Services.

Outsourcing the Great American Dream

In the 1957 classic movie “Desk Set, the technology revolution begins. The setting takes place at the “Federal Broadcasting Network.”  Bunny Watson (Katharine Hepburn), is responsible for researching and answering questions at the organization’s library.  With a merger pending, the company looks to automation.  In fact, organization ordered two computers  called “Electronic Brains.” Richard Sumner (Spencer Tracy), the computer inventor, is brought into the network in order to phase out the library functions in lieu of the human staff.  Bunny Watson fights to demonstrate the value of her human existence.

In a hypercompetitive environment, many businesses are outsourcing major functions rather than perform them in-house.  Today’s businesses have built elaborate systems for better efficiency and effectiveness.  Of course, they are driven by the quest for increasing profitability.  Robert Jacobs, Richard Chase, and Nicholas Aquilano, authors of Operations & Supply Management, suggest that operations management has been a key element in the improvement in productivity in businesses across the world.  Many times executive focus on the major expense to operate – labor.

It’s a simple equation:  productivity equals outputs divided by inputs.  If organizations can reduce their inputs for their operations, they can increase output (more profit).  Therefore, companies seek to reduce their inputs to obtain ‘more get.  Two of the chief strategies are to outsource non-core functions abroad or add new technologies to generate new efficiencies. These strategies are aimed at reducing labor costs, primarily people.

Since 2000, over 3 million U.S. jobs in the manufacturing sector have been moved abroad to countries like China, India, and
Korea. Yet, few executives worry about the aftermath of outsourcing initiatives.  The remaining workforce is shell shocked and
stressed since they are required to do the work of the laid off workforce.  Sadly, many supervisors feel that these workers should be happy to have a job.

Gareth Jones and Jennifer George, authors of Contemporary Management, maintain that one of the most important resources in all organizations is the human capital component. Many people wonder if American’s businesses cannot compete in
manufacturing and other high tech industries, will they forever forgo the Great American Dream for next generation of workers.

How do organizations stimulate their workers while outsourcing key components of their organizations abroad for greater efficiencies?

© 2011 by Daryl D. Green

 

A Process Mindset

If you want to research how to be a successful NBA franchise, you need to review the history of the Los Angeles Lakers. Yet, it is the run in the 1980s that is most intriguing to me as an organization.  With the retirement of Jerry West and Wilt Chambertain  in the 1970s, many people probably wrote them off.  Even with acquiring 7 footer Kareem Abdul-Jabbar, the Lakers couldn’t duplicate their past success.

However, the Lakers started building the framework for a future success. This process included selecting a young 6-9 point guard from Michigan State named Earvin “Magic” Johnson in the NBA draft.  With visionary coach Pat Riley, the franchise surrounded their 7 footer with much talent, including James Worthy, Spencer Haywood, Michael Cooper, and Jamaal Wilkes.

However, winning required All Star talent to become role players and swallow their egos so that they could win as a team, instead of individuals. This process thinking was successful. The 1980s Lakers, known as ‘Showtime” due to their electrifying performances, won five championships in a nine year span, including beating their rivals, the Celtics, several times in key games. Like the Lakers, organizations need a process for success.

If I could be a fly on the wall during student evaluations, I know my students would note that Professor Green is overly obsessed with process thinking. In fact, I even have a process for naming files for submission.  In a world that often promotes free thinking and spontaneity, some folks may believe that process thinking is too rigid to be used in an uncertain future.  On the contrary, having a process-oriented mindset will help organizations navigate the future. In this discussion, we will explore how a process mindset provides a competitive advantage during this economic crisis.

Being  process-orient is important in today hypercompetitive environment. High performance organizations in America understand that excellence does not happen by chance. Understanding one’s processes is vital. A process can be defined as “any activity or group of activities that takes an input, adds values to it, and provides to an internal or external customer.  Some of America’s shine across the globe has been taken for granted the small things in operations. 

H. James Harrington, author of Process Improvement notes, “We have taken a fine worldwide reputation and destroyed….We lost the important customer advantage, and each day our reputation worsens because our competition is improving more rapidly than we are.”  J. Davidson Frame, author of the New Project Management, further argues that organizations must evolve their processes. Frame notes, “Thus models contribute to the management of complexity by reducing the requirement for understanding a process in all of its details. They permit people to focus on the consequences of actions without having to understand their intricacies.”  Therefore, having a process mindset will have a greater impact on an organization’s effectiveness in the near future.

How can organizations more effectively utilize a process-oriented mindset in order to better compete in the future?

© 2011 by Daryl D. Green

 

Sustainability for the Future

Do we really want to pry into the future? Some people do not want to consider it.  In the 1970s, Alvin Toffler, author of Future Shock, wrote, “Citizens of the world’s richest and most technological advanced nations, many of them will find it increasingly painful to keep up with the incessant demand for change that characterizes our time. For them, the future will have arrived too soon.”

Clearly, the future is a highway with varying lanes, but do humans have the capacity to accept unhappy endings? In general, it is my position that humans are incapable of accepting unhappy endings. In fact, futurist Edward Cornish argues that it is easier for people to sustain a long-term perspective when they have a clear vision.  In this discussion, we will look at how organizations can create sustainable existence in the future.

Futurists utilize many techniques to anticipate the future. For example, strategic foresight can provide an avenue where organizations can strategically analyze short, mid-range, and long-term planning. Thus, it’s a glance into the future. This concept is easily seen on the Big Screen.

 

Hollywood blockbusters are the chronology of happy endings. People want to believe that all stories have positive endings. This concept is derived from childlike innocence of Americans. Unfortunately, the future may include unpleasant outcomes. Life doesn’t always provide a nice story. For example, globalization can provide many job opportunities, but the outcome isn’t always positive. In fact, the future prediction for the full-time worker is bleak. It is evident that technology and outsourcing are now making the part-time worker a reality of today, not tomorrow.

In fact, Charles Handy theorized that unemployed or spare workers will create their own new work in the future. Therefore, individuals will control their own destiny and become entrepreneurs. However, this runs counter to our American culture. Grandma taught us “go work for a good company and get a good job with benefits.” 

In fact, Bruce Sterling, author of Tomorrow Now, further argues that simple, predictable, and solvable jobs will go to the poorly educated and unprepared or to intelligent machines. However, high-paying jobs will go to the highly prepared, teachable, and creative individuals. In the future, good jobs will be the apex of human difficulty. Technology and understanding of complex systems will require a well-grounded person. However, futurist James Canton argues that American youth, our future workers, will be unprepared in math/science and may be locked out of future opportunities.

Based on many observations, organizations and individuals don’t want to hear negative scenarios for future generations. This reality reaffirms that people don’t want to think negatively about their future. Therefore, they often operate in denial or ignore the future.

Clearly, organizational leaders need to develop a strategy to deal with negative consequences. Many people don’t have the patience to look beyond short-term gains. Therefore, effective leaders need to know how to deal with the possibilities of negative futures.

How do organizations effectively navigate their operations for sustainability in the future?

© 2010 by Daryl D. Green