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  • Writer's pictureLars Christensen

High Output Management by Andrew S. Grove

I finished this book in April 2023. I recommend this book 8/10.

Written in 1995, this might be the most practical book for middle management. It felt like Intel CEO, Andrew Grove, decided to sit down and write the day-to-day tactics and responsibilities for his middle managers.

Get your copy here.

My notes and thoughts:

  • P23. In my experience, nowhere has the stagger chart been more productive than in forecasting economic trends. The way it works is shown in the figure below, which gives us forecasted rates of incoming orders for an Intel division. The stagger chart then provides the same forecast prepared in the following month, in the month after that, and so on. Such a chart shows not only your outlook for the business month by month but also how your outlook varied from one month to the next. If you do not systematically collect and maintain an archive of indicators, you will have to do an awful lot of quick research to get the information you need, and by the time you have it, the problem is likely to have gotten worse.

  • P36. Typically, you will find that many steps exist in your workflow for no good reason. Often they are thereby tradition or because formal procedure ordains it, and nothing practical requires their inclusion. Remember, the "visa factory" at our embassy in Britain didn't really have to process 100 percent of the applications. So no matter what reason may be given for a step, you must critically question each and throw out those that common sense says you can do without. We found that in a wide range of administrative activities at Intel, a substantial reduction —about 30 percent—could be achieved. Of course, the principle of work simplification is hardly new in the widget manufacturing arts. In fact, this is one of the things industrial engineers have been doing for a hundred years. But the application of the principle to improve the productivity of the "soft profession"—the administrative, professional, and managerial workplace—is new and slow to take hold.

  • P40. A Manager's output = The output of his organization + The output of the neighboring organizations under his influence. Why? Because business and education, and even surgery represent work done by teams. A manager can do his "own" job, his individual work, and do it well, but that does not constitute his output. If the manager has a group of people reporting to him or a circle of people influenced by him, the manager's output must be measured by the output created by his subordinates and associates.

  • P47. My day always ends when I'm tired and ready to go home, not when I'm done. I am never done. Like a housewife, a manager's work is never done. There is always more to be done, more that should be done, and always more than can be done. A manager must keep many balls in the air at the same time and shift his energy and attention to activities that will most increase the output of his organization. In other words, he should move to the point where his leverage will be the greatest.

  • P53. A great deal of a manager's work has to do with allocating resources: manpower, money, and capital. But the single most important resource that we allocate from one day to the next is our own time. In principle, more money, more manpower, or more capital can always be made available, but our own time is the one absolutely finite resource we each have. Its allocation and use, therefore, deserve considerable attention. How you handle your own time is, in my view, the single most important aspect of being a role model and leader. You, as a manager, can do your work in a meeting, in a memo, or through a loudspeaker, for that matter. But you must choose the most effective medium for what you want to accomplish, and that is the one that gives you the greatest leverage.

  • P54. Managerial productivity—that is, the output of a manager per unit of time worked—can be increased in three ways:

    • Increasing the rate at which a manager performs his activities speeds up his work.

    • Increasing the leverage associated with the various managerial activities.

    • Shifting the mix of a manager's activities from those with lower to those with higher leverage.

  • P59. For me, paying close attention to customer complaints constitutes a high-leverage activity. Aside from making a customer happy, the pursuit tends to produce important insights into the workings of my own operation. Such complaints may be numerous, and though all of them need to be followed up by someone, they don't all require or wouldn't all benefit from my personal attention. Which one out of ten or twenty complaints to dig into, analyze, and follow up is where art comes into the work of a manager.

  • P64. To use your calendar as a production-planning tool, you must accept responsibility for two things:

    • You should move toward the active use of your calendar, taking the initiative to fill the holes between the time-critical events with non-time-critical events through necessary events.

    • You should say "no" at the outset to work beyond your capacity to handle.

  • P75. A key point about a one-on-one: It should be regarded as the subordinate's meeting, with its agenda and tone set by him. There's a good reason for this. Somebody needs to prepare for the meeting.

  • P84. Very often, no one is officially given that title, but by whatever name, one person usually has more at stake in the outcome of the meeting than others. In fact, it is usually the chairman or the de facto chairman who calls the meetings, and most of what he contributes should occur before it begins. All too often, he shows up as if he were just another attendee and hopes that things will develop as he wants. When a mission-oriented meeting fails to accomplish the purpose for which it was called, the blame belongs to the chairman.

  • P97. Basically, like other things managers do, decision-making has an output associated with it, which in this case, is the decision itself. Like other managerial processes, decision-making is likelier to generate high-quality output in a timely fashion if we say clearly at the outset that we expect exactly that. In other words, one of the manager's key tasks is to settle six important questions in advance:

    • What decision needs to be made?

    • When does it have to be made?

    • Who will decide?

    • Who will need to be consulted prior to making the decision?

    • Who will ratify or veto the decision?

    • Who will need to be informed of the decision?

  • P103. How one plans at the factory can then be summarized as follows: step 1, determine the market demand for the product; step 2, establish what the factory will produce if no adjustment is made; and step 3, reconcile the projected factory output with the projected market demand by adjusting the production schedule. Your general planning process should consist of analogous thinking. Step 1 is to establish projected need or demand: What will the environment demand from you, your business, or your organization? Step 2 is to establish your present status: What are your producing now? What will you be producing as your projects in the pipeline are completed? Put another way, where will your business be if you do nothing different from what you are now doing? Step 3 is to compare and reconcile steps 1 and 2. Namely, what more (or less) do you need to do to produce what your environment will demand?

  • P105. Much confusion exists between what is strategy and what is tactics. Although the distinctions are rarely of practical significance, here's one that might be useful. As you formulate in words what you plan to do, the most abstract and general summary of those actions meaningful to you is your strategy. What you'll do to implement the strategy is your tactics. Frequently, a strategy at one managerial level is the tactical concern of the next higher level.

  • P108. I have seen far too many people who, upon recognizing today's gap, try very hard to determine what decision has to be made to close it. But today's gap represents a failure of planning sometime in the past. By analogy, forcing ourselves to concentrate on the decisions needed to fix today's problem is like scurrying after our car has already run out of gas. Clearly, we should have filled it up earlier. To avoid such a fate, remember that as you plan, you must answer the question: What do I have to do today to solve—or better, avoid—tomorrow's problem?

  • P110. A successful Management By Objectives system needs only to answer two questions:

    • Where do I want to go? (The answer provides the objective.)

    • How will I pace myself to see if I am getting there? (The answer gives us milestones or key results.)

  • P182. Performance reviews are a very complicated and difficult business, and we, managers, don't do an especially good job at it. The fact is that giving such reviews is the single most important form of task-relevant feedback we, as supervisors, can provide. It is how we assess our subordinates' level of performance and how we deliver that assessment to them individually. It is also how we allocate the rewards—promotions, dollars, stock options, or whatever we may use. As we saw earlier, the review will influence a subordinate's performance—positively or negatively—for a long time, which makes the appraisal one of the manager's highest-leverage activities. In short, the review is an extremely powerful mechanism, and it is little wonder that opinions and feelings about it are strong and diverse.

  • P187. One big pitfall to be avoided is the "potential trap." At all times, you should force yourself to assess performance, not potential. By "potential," I mean form rather than substance.

  • P188. There are three L's to keep in mind when delivering a review: Level, listen, and leave yourself out. You must level with your subordinate—the credibility and integrity of the entire system depend on your being totally frank. And don't be surprised to find that praising someone in a straightforward fashion can be just as hard as criticizing him without embarrassment.

  • P191. How can you target a few key areas? First, consider as many aspects of your subordinate's performance as possible. You should scan material such as progress reports, performance against quarterly objectives, and one-on-one meeting notes. Then sit down with a blank piece of paper. As you consider your subordinate's performance, write everything down on the paper. Do not edit in your head. Get everything down, knowing that doing so doesn't commit you to do anything. Things major, minor, and trivial can be included in no particular order. When you have run out of items, you can put all of your supporting documentation away. Now, from your worksheet, look for relationships between the various items listed. You will probably begin to notice that certain items are different manifestations of the same phenomenon and that there may be some indications of why a certain strength or weakness exists. When you find such a relationship, you can start calling them "messages" for the subordinates.

  • P200. Example of written performance report.

  • P204. The applicant should do 80 percent of the talking during an interview, and what he talks about should be your main concern. But you have a great deal of control here by being an active listener. The person should talk about himself, his experience, what he has done and why, what he would have done differently if he had it to do over, and so forth, but this should be done in terms familiar to you so that you can evaluate its significance. In short, make sure the words used mean the same thing to both of you. Here are some of the best questions:

    • Describe some projects that were highly regarded by your management, especially by the levels of your immediate supervisor.

    • What are your weaknesses? How are you working to eliminate them?

    • Convince me why my company should hire you?

    • What are some of the problems you are encountering in your current position? How are you going about solving them? What could you have done to prevent them from cropping up?

    • Why do you think you're ready for this new job?

    • What do you consider your most significant failures? What did you learn from them?

    • Why do you think an engineer should be chosen for a marketing position (Vary this one according to the situation.)

    • What was the most important course or project you completed in your college career? Why was it so important?

  • P207. The candidate can tell you a great deal about his capabilities, skills, and values by asking you questions. Ask the candidate what he would like to know about you, the company, or the job. The questions he asks will tell you what he already knows about the company, what he would like to know more about, and how well-prepared he is for the interview.

  • P210. Drop what you are doing. Sit him down and ask him why he is quitting. Let him talk—don't argue about anything with him. Believe me; he's rehearsed his speech countless times during more than one sleepless night. After he's finished going through all his reasons for wanting to leave (they won't be good ones), ask hon more questions. Make him talk because after the prepared points are delivered, the real issue may come out. Don't argue, don't lecture, and don't panic. Remember, this is only the opening skirmish, not the war. And you cannot win the war here—but you can lose it!

  • P217. Merit-based compensation simply cannot work unless we understand that if someone is going to be first, somebody else has to be last. As Americans, we have no problem accepting a competitive ranking in a sports event. Even the person who comes in last in a race feels comfortable about the system that says someone has to finish last. But at work, unfortunately, competitive ranking frequently becomes a highly charged issue, difficult to accept and administer—yet it is a must if we want to use salary as a way to encourage performance.

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