Part IV
1

If we want to create solution or Vision
we need to agree what to change to...
2

Why are managers inclined to
measure each department
or even each employee
separately?
This is since the pyramidical
view on the organisation fosters
the belief that the longevity of the
pyramid depends on the quality of
its separate bricks. That means it is
naively believed that the different
organisational functions act in
isolation and that the sum of the
functions of separate departments
and efforts by individually-taken
employees and managers
determine the success of the
organisation. Furthermore it is
thought the sum of these efforts is
equal to the achievements of the
organisation. 3

Were Darwin and Machiavelli soul buddies?
It is also rational to assess each department, chief or
employee separately because, that way, the popular
principle for political, singular and economic strategy,
“Divide and conquer”, is being implemented. It is a
watered-down, much-liked idea of Social Darwinism
about internal competition. All the inner battles of the
organisation – pyramid arise due to this determination.
4

“Divide and conquer” has been
transferred into the modern
business organisation, is upheld
by all methods based on
allocating “something” to a
functional unit: the Hierarchical
structure, Balanced Score Card,
ABC, Profit and Cost centres
and other methods for allocating
costs. Due to such methods, a
leader of a pyramidical
organisation, without realising it
him/herself, runs it – or more
accurately – its departments and
every single member on the road
of the marginal individualisation
and egocentrism of internal
competitiveness.
5

Localised, individual measurements “dehumanise” an
organisation. Along with the men/flies, it also produces
“career werewolves”. Meanwhile career plans are based on
internal competition – those steps up the ladder in the
pyramid that blind all persons climbing up them. Competing
individuals do not associate with one another even under
normal conditions; thus they even become enemies during a
time of crisis when special solidarity is required.
Thereby employees become overly individualistic on one
hand while, on the other hand, as W. Edwards Deming
assures, employees and managers become a faceless mass
to the company’s top management.
Then all that’s left, as usual in Hollywood’s movies, is for the
lonely fighter – a leader – to grab weapons and battle with
the powers of the dark.
6

7

How much measurements do
we need to drive organisation?
Who knows all ten
commandments?
Ask your colleagues:
Who knows 5?
Who knows 3?
8

1. How many “Commandments” should there be for an entire organisation to move in the necessary direction?
Now try to name the ten
commandments. . .
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
9

If you’re a typical European male, it’s
probable that, 99 times out of a hundred,
you answered as follows:
For the first two, you probably named
“Thou shalt not steal” and “Thou shalt
not kill” without hesitation. When it
comes to the third one – “Thou shalt not
commit adultery” – a discussion seems
needed. Then, after about the fifth one,
not much more comes to mind.
10

Is it possible to get by with the one base measurement
characteristic of Western management philosophy?
It would seem logical that a
company’s entire measurement
system is based on the effective
measurement of an entity – an
employee, a piece of equipment,
a product, a department and
such – at the operational level.
One side of the coin is that it is
characteristic for the Western
culture of management to have
numerous differing measures
for different departments or
resources. The other side is that
all the measurements come
together into one base measure –
the effectiveness of a separately-
taken unit of a ratio.
11

Let’s see what quantum physics says about this.
The nature of light involves both waves and particles. That is – light
is a wave and a particle (corpuscle) at the same time. Duality is
characteristic of all matter. Thus one measurement is insufficient!
However, as we experienced earlier, five are already too many!
Apparently, in physics, an elementary particle, before you start
measuring it, could be in the state of particles or waves or it could be
both a particle and a wave at the same time (known as the
superposition of two possibilities).
Not with standing this, as soon as we begin measuring, according to
Werner Heisenberg’s principle, only one state is gained; whereas, the
others disappear!
Thus, in quantum physics, an elementary particle does not have any
specific characteristics while it is still unmeasured.
Let us rephrase this. As long as we are not measuring, an employee
might work, might not work or work and not work at one and the
same time! (Once again this is known as the superposition of two
possibilities.)
Let’s take an example. An employee is standing watching a
computerised machine tool finishing parts. In a way he’s not working
but, at the same time, he is working, because the machinery is
generating a flow of parts. Or the opposite happens - the machinery
is broken and the employee is repairing it. Thus, in a way, he’s
working but also not working, because the machinery is not
generating a flow of parts.
This is what scientists refer to as the superposition of two
possibilities. 12

The one who works with all his might does the most
damage – the second theorem by D. Edwards Deming.
If You measure an employee in terms of
personal effectiveness, as customary in Western
culture, that employee will try to produce all
the time without regard to whether or not it
needs to be done. With the prevalence of
globalisation and overproduction, leaders
realise that, in the face of rapidly changing
market needs and a short product life cycle, an
employee must not be permitted to work at
maximum effectiveness. It is necessary to stop
an employee from time to time.
It’s a paradox: wanting effectiveness, you
must not maximally exploit every resource!
The same as in a symphony, the drums
should only play when they’re needed.
13

So then, the conclusion is quite simple: if one measurement
is not enough, and duality is characteristic of all matter, two
“Commandments” should be enough for an organisation!
There’s only one question left: what should they be?
14

But, at first -if you’d like to relax and balance work with a
personal life, toss the pyramid conception out of your head.
The hierarchy operates on the basis of three main
assumptions:
a) the environment is stable
b) you can forecast results
c) the amount of production or services can be
established in advance
This cannot be said either about traffic
or about business.
15

It is difficult for managers to see themselves in a self-organising
system even if they are daily participants within it!
One of many successful, self-
regulating systems that people have
created is road traffic.
Numerous individuals comprise the
road traffic system, none of whom
follows any sort of hierarchy. They have
different levels of education, knowledge,
social statuses and experiences. They all
have their own temperaments, ambitions,
cell phones and some of them even have
children riding in their cars.
How many traffic rules do all the
people out on the roadways
remember? They can probably recall
no more than a few – on which side to
drive and the meaning of a stop light.
16

A simple
conclusion can be
drawn. Traffic
rules regulate the
flow of the traffic
process, not the
abilities of
different
individuals. At the
same time, these
rules are identical
for all traffic
participants even
for holly cows!
17

E. Deming’s organisational
structure

There are two ways to travel – one by land and the other by
water. A select few choose one way, and the majority
chooses the other. Which one will You choose?
Meanwhile there are three main “flows of water”
in every organisation:
1. Flow of information. In a company,
this is akin to the human nervous system,
which relates what the market needs and
how successful we are at servicing clients.
2. Flow of goods and services. In a
company, this is akin to the circulatory
system. Flowing blood, satiated with
nutrients, covers the entire supply and
production process – from the acquisition of
raw materials to the delivery of production.
3. Flow of money. This is akin to the
respiratory system, supplying the entire
organism with oxygen. If there is no money
in a company, there won’t be anything else
either.
Concentrate on managing these flows, and You
will accomplish the feats of the Vikings!
19

What does the management structure of
organisation look like?
• It happens to be very simple.
• It’s the same as pictured by the Taoist symbols – Yin and
Yang.
• There is a Flow Manager, and a Manager Servicing the
flow.
• First assignment: manage the operational flow and speed it
up.
• Second assignment: analyse the reasons for flow obstacles
and eliminate them. 20

From a self-organising to a constantly self-improving
organisation
Peter Drucker assures that, in our times,
management engages in integrating
people and it is deeply entrenched in the
culture. Managers in Germany, the
United Kingdom or the United States do
exactly the same only in different
manners. The difference between
Japan’s economic success and India’s
relative backwardness to a great extent
can be explained by the fact that Japan’s
leaders were able to plant imported
concepts on management into the
farrows of their own culture and make
them grow.
21

The formula to turn non-ferrous metal into
gold
Performed work = completed assignment
on time + invented and introduced
improvement
• Hitoshi Takeda, known in Europe as an
expert of Toyota’s secrets, is convinced that
the leader of every company who wants to
become a business magician, must adopt one
secret ritual, believe in it and manage under
its influence. “Today at the morning your
company is in its worst condition
compared to what can get done by
evening,” says Takeda.
• That could be the motto of an
organisation that is self-improving every day.
22

Two Commandments for today’s business
organisation
If you introduce two new Commandments that are
singular for the entire organisation, you will develop an
organisation that is not only self-organising but also self-
improving – a united community and team to do the
following:
1. Perform the divisional assignment you’ve
received qualitatively, in its required amount and in as
short a period of time as possible (per self-organising).
2. Allocate remaining time for observation and
consideration (by employees) about how to improve a
lagging, critical operation of the company’s business or
(by managers) about what the reason is for repeated
“fire alarms” regarding the lateness of client service
(per self-improvement).
Both of them together will give to your organisation
possibility to Innovate!
•
23

The Rose and Cross – or how much does the soul of
Your company weight?
• Knights sanctified into the Rose Cross, magi and
alchemists established that the human soul weighs 21 grams.
The live rose is the symbol of the fragile human heart;
meanwhile the metal cross symbolises order, suffering and
resurrection. Placed together these symbols signify the human
soul.
• Naturally not even brotherhoods of process flow managers are
able to measure the soul of a company. Nonetheless, they
measure all the divisions in their organisation by a single flow
index, the Due Date Performance (DDP). This index establishes
the level of company services, i.e., the % of orders executed
appropriately and on time.
• The members of the TOC (Theory of Constraints) Brotherhood
who are exceptionally knowledgeable about secrets improve the
DDP index by introducing an additional monetary relationship.
In other words, how much income did the company fail to
receive on time due to the untimeliness of the client service?
This is noted by a secret abbreviation, TVD (Throughput Value
Days), which measures how many days a specific “sum of
money” was not “delivered” on time. The days are multiplied
by the sum that is due, and this is counted as penalty points
against the division responsible for the lateness. 24

Be the Angel Watchers of your
company!
• It so happens that the tactic for forming a process flow
organisation is the same, exactly the same as one of the key principles
in sciences – observation. Watch and assess your organisation every
day – there’s nothing so complicated about that; isn’t that so?
• I. Introduce indices for measuring flow that encompass
the entire organisation – DDP and TVD (Due Date
Performance and Throughput Value Days).
• II. Analyse the main reasons causing a critical impact on
all three flows (information, goods and services, money).
• III. Establish the critical factors slowing down a flow.
• IV. Direct the efforts at improving the main factor slowing
down the flow.
• V. Teach employees to systematically observe and daily
improve the “weakest” factor, or the one slowing the flow the
most, and provide the employees with tools for observations.
• VI. Motivate employees as a community by taking into
account the overall results in the betterment of a flow, i.e.,
the improvement of timely client services.
• VII. Instal these principles in the entire chain of the
business; i.e., initially at least lay water canals between the
pyramids of partners, and that will provide the greatest
effect in speeding up the flow.
• Most importantly – do all this along with your process flow
superior and the flow service manager.
25

What’s left is to choose: which is better – the Sun
Tzu art of war or Wa harmony?
• Pyramid and hierarchical management – complete with all the consequential flows such
as an orientation towards short-term results, overproduction, environmental pollution, anti-
ecological mindsets and outright trickery? Or?
26

What’s left is to choose: which is better – the Sun
Tzu art of war or Wa harmony?
•
•Pyramid and hierarchical management –and harmony –consequential flows anti-
complete with all the
Process flow management overproduction, environmental pollution,
as an orientation towards short-term results,
such
production only
asecological mindsets replenishing what has already been used to ease
a means of and outright trickery? Or?
planning, lower overproduction and lessen production overloads.
27

In conclusion . . . a Hamlet-type
of question: “To believe or not
to believe?”
Since physicists keep on
asserting to now that
their science is
impossible to
understand, then
everything written here
might be true or untrue
or it might be true and
untrue at the same time.
28

If you like and want to know more
details, you’ll find them in the book!

You can order a book,
or consultancy, or
lecture, or just a
dream at:
+370 698 41 027
Darius Radkevi!ius
darius@stockm.eu
www.stockm.eu
www.versloknyguklubas.lt