Podcast appearances and mentions of Michael Porter

Could 50% of the Fortune 500 vanish within eight years? In episode 169 of Manage Self, Lead Others video podcast, Dan Silberberg, master strategist for large enterprises, and with a storied CEO career, shares how Richard Koch's Star Principle 2.0 redefines market dominance and the shift from static enterprises to uncopyable ecosystems. Experience each episode in a whole new way and watch every video version on our YouTube channel HERE Subscribe now to be the first to catch our next release. Soundbites [02:29] Introduction to Richard Koch's The Star Principle and 80 / 20 Principle [02:52] Michael Porter's Five Forces model [06:24] How substitutes impact star businesses [06:59] Market shifts and changing consumer preferences [08:22] From company to ecosystem thinking [08:49] Predictions for Fortune 500 disruption and role of ecosystems [09:52] Service businesses enabling ecosystems [10:10] Adaptive intelligence and rapid market innovation [11:24] Cash cow stage and innovation timing [12:12] Agile innovation alongside existing cash cows [12:54] Static vs. exponential growth markets [15:26] Embedding innovation as standard operating practice [15:41] Shift from enterprise focus to customer-driven strategies [16:47] Key actions for using metrics effectively [17:07] Speed of reacting to data as competitive advantage [17:44] Building network platforms instead of static enterprises [19:27] Preview of “The Uncopyable Enterprise” eBook [20:14] Lessons from Buckminster Fuller [21:07] How to connect and work with Dan Silberberg CONTACT DAN SILBERBERG Website: https://entelechy.ai/ LinkedIn: https://www.linkedin.com/in/dansilberberg/ ABOUT PODCAST HOST, NINA SUNDAY Nina Sunday's latest book, ‘'Manage Self, Lead Others: Constructive Conversations, True Self-Leadership, and Culture You Can't Fake'' now on Amazon - paperback or kindle. Amazon USA ⁠⁠https://a.co/d/3WaplI9⁠⁠ Amazon Australia ⁠⁠https://amzn.asia/d/0KwghaM⁠⁠ You can read any Kindle eBook on your PC, laptop or phone; you don't need a Kindle device. Feel free to leave a review so others know it's a good read. === To learn more about face-to-face training programs with Nina Sunday or one of her experienced Facilitators from Brainpower Training Pty Ltd in Australia Pacific, visit: ⁠⁠⁠⁠⁠⁠⁠https://www.brainpowertraining.com.au/signature-programs/⁠⁠⁠⁠⁠⁠⁠ === To visit Nina Sunday's speaker site for conference speaking, Australia and globally, visit: ⁠⁠⁠⁠⁠⁠⁠https://www.ninasunday.com/⁠⁠⁠⁠⁠⁠⁠ === Connect with Nina Sunday on LinkedIn ⁠⁠⁠⁠HERE⁠⁠⁠⁠ === To subscribe to Nina Sunday's blog go to ⁠⁠⁠⁠⁠⁠⁠https://www.brainpowertraining.com.au/ ⁠⁠⁠⁠⁠⁠⁠and scroll to bottom of the page to register. Learn more about your ad choices. Visit megaphone.fm/adchoices

In this lecture, we explore Michael Porter's influential theory of corporate strategy and his warning about the dangers of being “stuck in the middle,” or in no man's land. We examine his three generic strategies—cost leadership, differentiation, and focus—and why clarity of choice is essential for competitive advantage. With real-world examples of both success and failure, we show how Porter's ideas remain deeply relevant in the age of digital transformation, where half-hearted strategies and unfocused digital initiatives risk leaving firms without direction. The episode also highlights the ethical dimension of strategy today, reminding us that clarity, responsibility, and courage are essential in shaping sustainable business success.

Discover how Andy Novins turns business challenges into big wins! Andy shares with host Andrew Stotz how he uses Deming strategies to outsmart competitors, watch for market shifts, and win loyal clients in one of the toughest industries around. TRANSCRIPT Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm here with featured guest Andy Novins. Andy, are you ready to join and share your Deming journey?   Andy Novins: I sure am. Yep.   Andrew Stotz: We've done a lot of prep for this, had some good conversations, and I'm looking forward to it. Let me introduce you to the audience. Andy first got introduced to the teachings of Dr. Deming more than 30 years ago and has been hooked ever since. He attended Dr. Deming's four-day seminar in August of 1993, only four months before the passing of Dr. Deming on December 20th of 1993 at the age of 93. Andy was a co-owner of a women's athletic apparel company, which was eventually purchased by Warren Buffett's Berkshire Hathaway. For the past 23 years, he's been applying Dr. Deming's philosophy to his work in real estate, which traditionally has operated in what could be described as in opposition to the teachings of Dr. Deming. Andy, why don't you tell us a little bit about what you're doing right now and maybe a little bit about how you got into what you're doing now, and then later we're going to talk a little bit about your experience with Dr. Deming and all that. But just let us know, where are you at? What are you doing?   Andy Novins: Okay. Well, I am in Northern Virginia, just outside Washington, D.C., and after my partners and I sold the company that Andrew just referred to, I had to decide what I was going to do. And I had about six months to do that because part of the contract required me to help the purchaser, which originally was Russell Corporation, a big athletic, they made all the Major League Baseball uniforms and everything. We had to transfer my company's systems to their systems, and that was one of the worst six months of my career, watching everything we had done, which was really all Deming-based, being sort of dismantled and worked into another Fortune 500 company at the time. It was, somewhat, actually it was a few years later that Berkshire Hathaway bought it, and it was because Russell was not doing very well. It was a rescue-type purchase by Berkshire Hathaway, which sort of had some satisfaction in mind that their systems weren't all that good. So that's where I got into Deming, and I've taken a lot of what I learned from the apparel company into real estate, which, as Andrew just mentioned, is very volume-centric, volume-focused, and focusing on processes as opposed to systems.   Andrew Stotz: And in the real estate world, for those people that don't know, let's say real estate, what position are you in? For instance, my sister is a mortgage broker in Maine, and that's a different place within the whole sphere of it, but maybe you can explain exactly where you are in the value chain.   Andy Novins: Okay. We focus on residential real estate. What we call in real estate farm, okay? I send out 5,000 newsletters a month that show to eight different areas, really, but they're all within, believe it or not, two miles of my house. And those news, I've been doing that for over 20 years. I've never made a cold call. I will never call anybody and say, are you thinking of selling or anything like that. Yet, using this process, which is all really Deming-based, I've done about 10 times the volume of any other realtor in the 5,000 homes that I service. It's the process... I don't want to use process. The system we used is based on Michael Porter, his concept of competitive advantage. And it's a system that's focused on a value chain, things that we do that other people can't do. For example, there are close to 300 sales a year in my 5,000 home market. I see every one of them. And when you see a house that's on the market, you know a lot more than anybody else does by looking at pictures. If you've ever been to an open house and after seeing it on the internet, it's a lot different than what you saw in the pictures. No other agent can do that because most agents in my area focus on Northern Virginia, which would be about 20,000 transactions a year, not 300. So they can't even try to compete with me in my area. So that's the whole concept of it is doing things. As Michael Porter would say, you have a value proposition. That's my expertise in my local area.   Andrew Stotz: Porter talks about different strategies. One, he says, is the low-cost leader. Another is the differentiation. And the third one he talks about is focus and where you're focused on a niche in the market. And then I guess I always kind of think that really he's talking about two, because with focus, you're picking a niche, but then you're going to either be a low-cost leader or probably a differentiator in that focused area. But when you talk about Porter and what he's teaching, can you explain a little bit more for those people that don't know what he talked about?   Andy Novins: Sure. Yes. Basically, yes. I mean, I'll never forget. My partner and I were at a breakfast, realtor breakfast at one point, and there was an agent sitting across the table from us and he said, I just got this listing. And he said, but I had to go down to 1%. And he's, you know, for commission. And at that time, commissions were pretty much 3%. And he kind of looked at us and said, that's better than nothing, right? And that's the low-cost. Low-cost producers will never win. It'll always be somebody else. And Porter says, you can't be the best either. Okay. There's no such thing as the best realtor. There's always going to be somebody else. So the concept for real estate is picking a niche, that for me, it was farming. I'm a pretty good writer. So I write a newsletter, and people call me when they're ready to sell their house. And it's worked beautifully for... I started that in 2003. Okay. But there's people that focus on luxury, the luxury market or people that focus on first time buyers, or people that focus on... There's all kinds of different niches downsizing or upsizing. And so you can become an expert in anything. And that's how you differentiate yourself in real estate.   Andrew Stotz: And that concept of not competing to be best that Porter talks about is great because it also forces you to think. You're focused on the wrong thing if you're focusing on how to beat the competitor. And I always enjoyed the fact that Deming was so focused on the customer.   Andy Novins: Yes.   Andrew Stotz: And that, I think with Porter, I like that. But with Deming, I just really love the idea that he saw quality in the eyes of the customer. He saw innovation and continuous improvement in relation to the customer as primary over trying to benchmark off of some competitor.   Andy Novins: Exactly. And if I go back to my apparel business, the name of our company was Moving Comfort, and we just made women's apparel. Nobody else ever stuck to just that. We were the only company. Just, everybody broadened out to try to get more. So again, it's the same concept of a niche. Okay. But one of the policies, I guess, we've developed, it was a Deming related policy, which was fun, okay, was when we made a mistake, which we often did, whether we shipped somebody the wrong thing or we did other things, our objective was to make the, delight the customer, as he would say, make them happy we made the mistake. And that didn't matter what that cost to do that, sending them free stuff, doing whatever. And I think that's a Deming concept that we used in the apparel business aside from many, many others. Back to real estate, that's, I don't know anybody else in the Washington area that does what we do, because nobody's willing, that's the so-called trade-offs. Nobody's willing to say, I'm just going to focus on 5,000 houses.   Andrew Stotz: Yeah. It's scary.   Andy Novins: They can pick whatever they get.   Andrew Stotz: Yep. Yep. And maybe why don't we now go back to August of 1993. How did you find yourself in a four-day seminar? And I'm kind of jealous because what... My seminars I went to in '90 and '92 were two-day seminars.   Andy Novins: Really? Okay.   Andrew Stotz: And I had thought that he... I had thought by that time, maybe he was only doing two days, but then I learned that he was still doing four days. But what got you to that seminar? Where was it, and what got you there?   Andy Novins: Okay, I was going on vacation. Okay, this was in 1990. We were going to go to Cancun. And there's this, I guess they're still around, but there was a bookstore in DC on K Street called Reiter's. And it was all business and science. And I used to go there because pre-Amazon or anything like that. I think it was even pre-Borders. But I used to go there and spend an afternoon looking at books. And I found Out of the Crisis. And I brought it home and I said to my wife, by perusing through it, I didn't know anything about Deming at that point. But perusing through it, it just struck me as something I really wanted to read. And I went home and I said, I'm taking this book to Cancun, and I'm going to sit on the beach and read it. Well, I actually didn't read it till got home. But I got completely enthralled with it.   Andy Novins: And being in suburban DC, we're like eight miles from the White House. The Deming Study Group was very active in DC. Dr. Deming lived in DC. And there were just a lot of very well-known, famous speakers that would be part of our group, including Deming at one point, but I wasn't. But I think it was before I joined the group. So I read the book, joined the group, and after about three years, I had heard enough about the seminar that I wanted to go. And I went to that in Chicago. It was the first or second week of August of '93. And one of the things that I never really understood that Dr. Deming would say a lot was talking about being transformed, or the transformation that you get when you're studying his philosophies. And I always kind of said, well, that's not going to happen to me. It just was foreign to me. That third day of the seminar, I was transformed. I don't know how to describe it, but ever since then, I look at the world through his eyes and see things and think in systems and variability. And you get all that when you first get exposed to them, but you're not transformed. Somehow it all comes together. I couldn't describe it, I never thought it was, but that happened during that seminar.   Andrew Stotz: And what Dr. Deming talked about was the idea is that the person who's leading the organization has got to go through a transformation in order to truly implement this.   Andy Novins: Exactly.   Andrew Stotz: What was it like there? How many people were in the room? And what was your... You walked in knowing a bit. I walked in knowing nothing, basically. And it was just like, whoa. But I'm just curious, what were your first impressions? For those people that have never and never will have a chance to go in, give us a feeling about how it went.   Andy Novins: I don't know if I mentioned it was in Chicago.   Andrew Stotz: Yep.   Andy Novins: Okay. Which is a great city, and it was in the summer, which is often hot. But I was amazed because at that point, and I may be wrong, but I think it cost $1,000 to go. Okay. And he had 500, and I'm pretty sure that's about what it cost. And do you remember what yours was?   Andrew Stotz: Mine was about 500 people, for sure. I didn't pay for it, so Pepsi paid for it but I would think it was even more than that. But who knows? But maybe mine was a two-day, so it was less, I don't know.   Andy Novins: But it was 500 people. That's what I remember, because being a numbers person, I translate that to 500,000 for the four days. And so that kind of stuck in my mind. And he did a lot of them. And one of the things, too, that he did a lot of them, and I think, geez, he's making a lot of money doing this. He lived in a little tiny house on a street in Washington, and he worked in the basement. One of the things that happened to me after that, again, with the Deming Study Group, was his son-in-law, Bill Ratcliff, okay? Somewhere shortly after the four-day seminar, he called me and he said, I'm getting a lot of feedback, you guys at Moving Comfort are doing a lot of using Deming's theories and everything. Could I come and visit the company and you show me what you're doing? And I said, sure. I mean, any more exposure to any of the people interested in Deming at that point was fascinating to me. And so he came and he spent a good part of the day at the company. And then I'm not even sure if at the time I knew that he was Deming's son-in-law, but then we went out, his wife was Linda Deming Ratcliff, okay? And so he and Linda and my wife went out to dinner a couple of times after that. And it was fascinating to hear both of their stories about Dr. Deming. What I remember is Bill would say, we used to go over there on Sunday mornings and read the newspaper, and Dr. Deming would be down in the basement working. And he'd come up periodically and say, how are you doing, Bill? In his voice, and then go back down and work. And he constantly was focused on his work. And so those relationships just tied me into Deming forever, especially after the four-day seminar.   Andrew Stotz: Yeah. I think it was a discussion with Bill Scherkenbach when I asked him about what it was like in the basement. And Bill was telling me, I don't think we got this recorded, but Bill was telling me that somebody asked him why you have all of this stuff around you and in your office. And he said, I'm desperate. I'm absolutely desperate. And with the idea that he was on such a mission. And I just feel like when I went to the seminar, the first one was in Washington, and then the second one was in Los Angeles. I didn't know how significant he would be in my life at the time, and I didn't understand the transformation I was going through. But what I did later really come to understand is that he inspired me to have a mission. And like, why am I doing what I'm doing? It's one thing for all of us to be busy, working really hard, doing all kinds of stuff and bringing value to our clients. But for what? What's the mission? And was a huge, that's a much bigger takeaway for me now than it was then. But what I witnessed was this man who is very old, just conveying an incredible message. So, yeah.   Andy Novins: Yeah, it was, and he was... Well, DemingNEXT, if anybody is involved in that and can see a lot of the videos with Dr. Deming, especially during the years that I was interested in watching and everything else, he just had a unique way of presentation, but he did have a sense of humor. And it was a dry sense of humor, I guess, maybe going with his dry martinis.   Andrew Stotz: Yeah, tell us that story about Deming Martini.   Andy Novins: Yes. As one of the sessions at the four-day seminar ended, apparently this Deming Martini is famous or was pretty well-known at that point. So he described how he loved martinis and he acted out the process of making one. And again, he's 93 and just you could tell this is just part of his life he loved. And he, so he kept his vermouth in the freezer, okay? And it was, and so he demonstrated how he poured the gin, and then he acted out like he went into the refrigerator freezer and took out the vermouth. And then he would not open the bottle, but he would wave the bottle around the glass and then he'd put it back in the freezer, and he'd say, this is the best martini you can make. And he had a lot of stories that added a lot of spice to it.   Andrew Stotz: So when you left that seminar, what changed in the way that you were operating? And obviously you had already had awareness of the teachings, but did that inspire you to go to a different level or what did it cause?   Andy Novins: Yes, and I'm not sure at what point the so-called transformation took place in the four-day seminar. You knew that that's how you were going to think for the rest of your life. That wasn't, you were going to think in systems and variation and predicting from the system and all those things. But so I can't really remember what years we did it, but as an apparel, our company basically, we designed, manufactured through separate factories and sold women's athletic apparel to specially sporting goods stores around the country. Nordstrom's was a client, one of the bigger ones, L.L. Bean and those kinds of things. And so one of the things we implemented that was really a Deming concept was improving our shipping, the picking process, which is filling an order. And we automated that with a carousel, which brought the product right to the picker, the warehouse person, and barcodes and scanned the order, and it brought the thing right to them. It incredibly reduced our error rate in shipping. And at the time, this would have been like 19, this was '91 or somewhere early on that. And at the time, we were way ahead of other companies.   Andy Novins: Even Nike, they would get an order, they'd walk around and pick their orders. And so that was a Deming-inspired process or way of improving our system. With apparel and you're designing 100 different styles or sizes and styles and everything else, the design development group, the functional silos that, I don't know if Dr. Deming used that term, but the system that every department has to hand off is working for the next department. In apparel, it's really complicated. And that was the biggest Deming issue we would focus on. It never went away. You really had to always, because our designers would put bells and whistles into a garment. We were very high-end and it either wasn't practical price-wise or it wasn't practical in the factory or we didn't have a good source for where we were going to put it, where, what factory we were going to put it in, that type of thing. So that's where really the Caribbean Basin Trade Initiative at that point came out. That's where we had factory, up until about 1990, all our production was in the United States.   Andy Novins: After that, it got too expensive, labor, sewing labor in the United States. That's when most companies started going offshore. We did a lot in the Caribbean. And when you're manufacturing apparel, back at the beginning, you would ship, we would buy the fabric and we would ship it to the Caribbean factory that we were using and they would sew it, and put it together. And then trade agreements came out where the factories could buy the material. And essentially, instead of they being just a sewer, they would be making a finished product for us. That had huge implications on simplifying the system and transferring responsibility to the people that really needed it. But now maybe I'm getting too much into apparel, but...they haven't been doing it for 23 years.   Andrew Stotz: So let's talk about what you're doing about your application of Dr. Deming's teaching in real estate. And I know you've also brought something along to share and go through, but maybe you can just talk a little bit about how you're applying that in the real estate business.   Andy Novins: Yeah, and that's the control chart concept. And all real estate statistics are lagging indicators, whether we're talking median prices or active listings, or I guess active listings are the only one that's not a lagging indicator, but almost virtually every month's supply of inventory, all those things are lagging indicators. So they tell us as realtors what happened. And in my market here, it bottomed out after the 2008 recession in March of 2009. And until this year, it's gone straight up for 16 years. So most realtors, virtually no realtors... Well, most realtors haven't experienced a shift in the market, which is what we're going through now, where the market goes from being a buyer's or seller's market for all those years. And I'm talking about a strong seller's market. A seller's market is defined by the National Association of Realtors as any market where the months' supply is less than six months. And our supply was hovering around two to three weeks. And it's now almost two months, but the market has shifted and it's incredible how many people don't realize that.   Andy Novins: Everybody knows there's something going on, but the media takes care of that. But all the statistics we get are, again, median prices are still very high, okay? But using control charts, you can plot, for example, a couple of months of live inventory. That started going down in April, okay? I mean, that went out of the control limits in April, okay? That's telling us that something's happened. It tells us directly that the market shifted, okay? The other thing that I watch is price drops, okay? How many price drops? That went out of the control limits in, I think, June, they started out, okay? And we're looking at that weekly, and that's showing us every week, the number of price, it's so far out of the control limit right now, it's amazing. There's no... You can't... You can look at price drops, and you can look at months' supply on a graph, okay? But it doesn't tell you that the system's now out of control. But control charts do tell you that, so...   Andrew Stotz: Should we look at your control chart? Maybe that's a good time to do that.   Andy Novins: Sure, yeah. And before we do that, one of the things in real estate is seasonality, okay? And that hides a lot of problems because prices go up in the spring, down in the summer, down in the fall, up a little bit, then down. But let me bring those up and talk about them. Okay, you can see this?   Andrew Stotz: Yep, and for the listeners out there, I'll just describe. You've got a line chart up here, and a line that's going up and down, and then recently is going up a lot. And it starts in July of 2023, and it goes to June of 2025. And so why don't you take that away and help us understand what you've got here?   Andy Novins: Okay. So the control limits, the upper and lower control limit are the red lines on this. And going back to July of '23, everything was stable. And if we went back long before that, it would also have been stable.   Andrew Stotz: Yeah, and by the way, just to make it clear, it's monthly supply, or month supply, sorry, of housing.   Andy Novins: I'm sorry.   Andrew Stotz: Can you explain what it means, month supply?   Andy Novins: Yeah, month supply is the number of active listings at the end of a month divided by the average monthly sales for 12 months, the 12-month average. So it's basically saying if you've got 10 active listings and the average is two a month, that you've got a five-month supply of listings. Okay?   Andrew Stotz: And the average on this is one month supply.   Andy Novins: The average, right. And you can see where during the pandemic, we've had times where it went down to just a number of weeks, which is pretty incredible, but that's our market. So again, this chart is telling us that... Well, there's another thing, other ways that Dr. Deming would look at this. We've got several months where it's going, the month supply is just going up. So starting in December '24, you can see that the supply keeps going up. And then it went out and broke the upper control limit. So what he would say in this, looking at this chart is that up until really of March 2025, the system was in control, it was predictable, okay? And then starting in March or April 2025, it was out of control, it was not a stable market, and the market is a system.   Andrew Stotz: And it went up above the upper control limit of 1.6 roughly or 1.55. And now the highest it went up in May was about one point, almost, yeah, 1.8.   Andy Novins: 1.8, okay. And so Dr. Deming would say that number one, it's a shift in the market, number two, the market is no longer predictable. Okay? Clients don't like to hear that, but using these charts and explaining it to them, they do understand it. And in real estate, one of the most important things when markets are changing, or always actually for that matter, is managing client expectations, okay? And using Deming's theories and control charts, it makes it... And I'll get into that a little bit more in a minute, but managing their expectations becomes more of a science than scripts, which is what...   Andrew Stotz: One of the things I learned from Dr. Deming was be skeptical of data,  and I know I've spent my career as a financial analyst manipulating tons of data. And every time I see something out of control like we see here, the first question I ask is, is there an error in the data? And then the next question is, okay, so what's going on out there that the chart is one thing, but can you just talk briefly about what's going on? What do you think is behind this? What's causing it? What is that shift that you're seeing?   Andy Novins: Well, if you were asking me this in 2008, I could have told you. The irresponsible lending and all kinds of other things. Today, the market is in our market more than others is impacted by uncertainty. Okay. Uncertainty surrounding the impact of tariffs. Okay. But especially in our area, the impact on federal workers job security. Okay. In our area, which is an expensive area, almost any couple that is buying a house is buying it on two incomes. And if one of those, one of the members of the couple is, works for the federal government or is a government or works for a government contractor or is affected by any, in any company that may be impacted by government cutbacks, they're not buying a house right now. They're waiting. So they don't want to buy on one income. And so they pulled out of the market. And that's, that's the biggest reason for the increase in the supply. The other is,  people do want to move. People want to downsize and upsize. Well, most people have a 3% interest rate or better or slightly around there. So with the impact of low, you know, of rising interest rates and everything else, there's people that want to downsize. And if they move, they'd be paying more for their smaller house than they were for their house they're staying in. So they stay.   Andrew Stotz: What are, what are mortgage rates right now? Roughly.   Andy Novins: That's  675, 6.75. 30 year. But what's interesting on that, and I haven't done it, but it would be an interesting exercise is when I began my career as a CPA in New York, I moved down here in 1982 to be part of the company that I talked about before, the apparel company. I, when I said to her, when I had that opportunity, I said to my wife, what do you think about moving down to Washington? We lived in Westchester County, New York, and she said, well, sure, but, and at that point, I was treasurer of a bank in the New York metropolitan area, and she was willing to take the risk. It was a risky move, but she said not, but not, we can't sell our house. We have an eight and a half percent mortgage. We'll rent it, and if it doesn't work in Washington, we can always come back to it. So that eight and a half percent mortgage back in '82 was not something you got rid of, and people don't realize that the average mortgage rate in the past 50 years is eight percent. So at 6.75, it's not that bad, but it's relative to the three percent interest rates we had. It's making it tough for people to move.   Andrew Stotz: So just talking now, I just want to wrap up on the chart by saying, so once you use, you're demonstrating using a control chart in the industry of real estate, and you're discussing the fact that right now, you've got three points that have breaking out of the upper control limit, which now tells us, as you said, it's unpredictable at this point. What else, what do you take from that, and how does that drive your actions when you see this chart? How does that impact you, and in other words, how are you applying Deming's teachings once you've now done this?   Andy Novins: Great question. When you price a house to sell it, you use what we call comparable sales. When a market is going up or stable, comparable sales are a good indication of what you're probably going to price it at if it's going to go on the market soon. What realtors do is what we call a comparative market analysis, and that's comparing at least three homes to their home. There's all different ways of doing that, which is part of a Deming system too. But when you go to somebody and say, well, we got these three homes and they sold it at 800, but if you're going to put your house on the market next month, we're probably looking more like at 750. And most people would say, well, I'm not going to use that guy. This other realtor says 800 is the way to go. And using the control chart showing that the market has shifted and that those comps are no longer valid is one of the most valuable uses of control charts in real estate because, again, it's evidence that the comps aren't valid anymore.   Andy Novins: The other thing is comps represent, even if it closed yesterday, it went under contract a month ago. So the comps are just not necessarily good if the market is shifting, and this is pretty powerful evidence to a potential client that pricing is really important and you can't just use past comps. I'll go to the next chart, which is price drops. And this is something, again, our market really just shifted recently, so this is something I'm actually doing actively right now looking at. But you can see that this is weekly price drops. Okay, it started off monthly because I can't go back and get that data. But if I go back to a stable year, last year is the base. You can see that price drops were pretty stable process in the pricing system. They were...   Andrew Stotz: So what does that mean? Just so we understand, let's say the average is 25% projected monthly price drop. What does that actually mean?   Andy Novins: That's saying that every month that of the active listings on the market, 25% of them are reducing their price. That month.   Andrew Stotz: So in other words, 75% are either keeping it the same or raising it.   Andy Novins: Say that. Yes, right.   Andrew Stotz: The opposite of that. Okay.   Andy Novins: Right. And that's each month. That doesn't mean somebody didn't lower their price on that same house the month before. But it's registering the number of drops that homes on the market are doing.   Andrew Stotz: And that would mean it's like a pretty good seller's market again when only a quarter of listings need to drop their price in order to get the sale.   Andy Novins: Yes, exactly. Yep. Exactly. And you can see this...   Andrew Stotz: And let's just talk about the January 2024 to December of 2024. So for the year of 2024, what's your observation of the data?   Andy Novins: It was stable. It's not a change in the market.   Andrew Stotz: Yep. Okay. Normal variation.   Andy Novins: Yeah, normal variation. Okay. But when it starts to go up like it has, and it's even worse because what I'm using is an average for these weeks. The next week starting tomorrow will have the four-week average. They're actually quite a bit higher, the last two, than what they show here because they were averaged down. But when you see rampant price dropping, that's out of control, so to speak.   Andrew Stotz: Right. So it's gone from a mean of 25 up to 60-plus percent of monthly price drop. I'm just curious. It says on your y-axis, it says projected monthly price drop. Does that mean somebody's making some estimate on that, or what does that mean?   Andy Novins: That's because right now I'm doing it by the week.   Andrew Stotz: Okay. Ah, okay.   Andy Novins: Okay. And I'm averaging the week. And then when I get the month, it'll be like the earlier ones.   Andrew Stotz: So the most recent ones are the projected, and the other ones are the actual month.   Andy Novins: Yeah.   Andrew Stotz: Okay.   Andy Novins: And right, I'm using, I'm multiplying them times four the week. So it's right now I'm projecting what July will be, basically, the total, but it'll be up around 60%.   Andrew Stotz: And this chart corroborates the conclusions that you made in the prior chart, or are there any other additional...   Andy Novins: Yeah. And the month supply chart is more of a leading indicator of a market shift, because this is the reaction of sellers and realtors to a market they didn't anticipate properly. And so this is a much more now type of thing. And again, if I go back to a client and say, you know, all the comps are 800, but we're going to recommend 750, this is pretty convincing evidence that basically almost everybody in the market is reducing their prices.   Andrew Stotz: Yeah.   Andy Novins: And in a falling market, the worst thing you can do is chase the prices, chase it down.   Andrew Stotz: Yeah. And what this doesn't show, it shows that 60% are dropping their price. It doesn't show what the remaining 40% are. And that composition of that could just be, there could be no price increases. We don't know from this data whether that's holding the price the same or increasing it.   Andy Novins: Right. But it doesn't mean that there aren't homes in those active listings that didn't reduce their price, that reduced their price. They may have reduced their price last month. Okay. So it's really just showing the panic that's out there.   Andrew Stotz: Okay. Got it.   Andy Novins: But it's a great leading indicator from that standpoint.   Andrew Stotz: Okay. So two charts that show us the application of control charts and Deming's teachings there in real estate and making a note of the fact that these are now out of control. Interesting.   Andy Novins: Yes. And again, the most important thing you can do, I think, in real estate is accurately manage your client's expectations. Yeah. Because, and I'm going to back up for a second, that's another real benefit of having a niche practice. And again, like the competitive advantage Michael Porter concept. And for me, writing a newsletter, which gives them what we hope to be useful information for the 5,000 homes that get it. When they're ready to sell, again, I don't call them, they call me. And they call me because they trust me. They believe I know what I'm doing. And so part of a system that would be outside of what Dr. Deming talked about, but part of the system is your clients, the quality of your system is going to depend on the quality of your clients. And so having a niche, again, what I'm doing in terms of that so-called farming and the newsletter is I'm attracting clients that will trust me. Okay. That's so much a Deming concept in terms of the overall system and how it affects it. We see all the time when buyers that are buying one of our listings and they have all these problems and the other real estate agents, their buyer's agent says, I know they're crazy. I can't wait till this is over because their buyer clients aren't listening to them and they're asking for unreasonable things or whatever. So a critical part of the system in real estate is getting clients that will listen to you because theoretically we know what we're doing.   Andrew Stotz: And if we look at this chart, one of the things that some people may ask is what about forecasts? And I know I spent my career as a financial analyst in the stock market forecasting earnings. And then when I worked on my PhD for my dissertation, I decided to calculate the accuracy of analysts in earnings forecasts. And as I said, the title of my dissertation was analysts were only 25% wrong. And in other words, here is the highest qualified people to forecast the earnings of these companies and they get it wrong by 25% on average. And so for those people that say, well, what about your forecast and all that? I always say, I live on the cutting edge of history. Don't try to go too far out in the future. Just make sure you understand. And that's where this chart shows July 19th to July 25th that you could say that's pretty much, and if you get the data out the next day, that's the cutting edge of history.   Andy Novins: Yeah, yeah, exactly. And in the past, people say, well, should I wait?  At this time of the year, they might say, should I wait and put the house on the market next spring? Or should we do it after Labor Day? And in the past, I would have said, wait till next spring because things were going to be better. You could... Everything was stable and rising. What these charts show, and they do require some explanation, is that the market is out of control right now. You can't predict it. And then if so,  then it becomes a decision that a client makes based on what they really need. Do they want to move yet? Do they want to wait? Do they... But these control charts are showing that you can't predict. Whereas in the past, you could be pretty safe.   Andrew Stotz: Yeah. And the point of that, too, is that a control chart can't solve every problem. It tells you where things are, so you understand things a lot better. But then, how you're going to actually use that information, well, somebody may use it to say, I need to sell my house now. Somebody else may say, I'm going to wait because I think this is bad and it's going to get better later. And somebody's going to say, I'm going to sell now desperately because I think this is going to get much worse, right? That's the hard part.   Andy Novins: Yeah.   Andrew Stotz: But if you don't know what's actually happening, which the control chart gives you that information, then there's none of that.  It's just, there's no basis in fact of what you're doing.   Andy Novins: Exactly. Right. They provide a window into the market that I have never seen anybody use this or talk about it.   Andrew Stotz: And do you have any more charts? Was that it?   Andy Novins: No. Yeah, I got more.   Andy Novins: Okay. Whoops. Oh, but before we get to that, okay, so this is a concept, and if I'm going too long, cut me off.   Andrew Stotz: No, no. Go ahead.   Andy Novins: So in a falling or stable market like we're in, okay, in a rising market, you pick a price, and if you're good, you're going to do well. If you do it right, they're going to bid it up. That's the way it's been for five years since COVID. Okay. Now the market is not rising. It's falling or even in a stable market. So the PDSA cycle that Deming talked about is absolutely so on target for what we're going through right now. So I'll just briefly go through this. The plan part is you price using comps or adjusted comps based on what the control charts are showing where the market is going rather than where it was. Okay. And then you put the listing on the market in the MLS. And then what we do, okay, is we study what's happening, okay? And again, the market is not in control. It's not a stable system. So we monitor and we subscribe to special services that most agents don't get. They cost money, but they give us a lot of information. We can see the number of views all over the internet that a house is getting that's on the market. And we can subscribe to another service that shows all the showings that are comparable houses in our zip code or any way we want to do it are getting. And then we use the control charts and we look at feedback and everything else.   Andrew Stotz: So do you have more charts, Andy?   Andy : I sure do. This isn't actually a chart. It's one of the core tools that Dr. Deming used. And it's what he called the PDSA cycle. And that is the most important tool that we use with the data we get from the control charts. So I'm going through an example here of pricing. And so the PDSA is plan, do, study, act. And the planning section of this process is we price using comps, like I've described. But we also use the control charts to let us adjust the comps for what's happening in the market right up to today, basically. And the do is just in real estate is just simply putting the listing in the real estate market, MLS, and listing it so people can see it. The study, though, is what's really important. And that's where a lot more data comes in. We subscribe to services where we can monitor all the views all over the Internet of our listings. And we can monitor showings that our listings are getting, which we know, but other listings. We can monitor what they're getting in terms of competitive listings, similar prices, and that type of thing.   Andy : And we also monitor what houses, if any, are going under contract since our property went on the market. And that provides what we talk. So we have to act on that data. And that's the A of the PDSA cycle. And so we use feedback loops. So just as an example, I won't necessarily go through all these. If we have a lot of views, high views, and high showings, we know the price is right. We're going to get offers. On the other hand, if we have high views and low showings, we know buyers are interested in it, they like it, but they're not ready to come and look at it. They're waiting for that price to go down, which in this market, it probably will. So we advise our clients based on the data we're getting, and then we either reprice or we don't. There's also some other things we use to monitor, but I won't go into those at this point.   Andrew Stotz: What's interesting about that is it's like every single listing is a test.   Andy : Exactly.   Andrew Stotz: That's cool.   Andy : Yeah. And that data is so important. And when you tell a client, you're getting all kinds of... You're getting... And we compare it to the other listings. We give them charts, which shows the other houses. And we say, look, you're getting twice the views of these other houses, but nobody's coming to your house, or very few are coming. And the other listings are getting less views and more showings. People think you're overpriced. And it's very convincing to a client.   Andrew Stotz: Is there one of these that you're aiming for? And if you are close to that in your listings, you're hitting the right spot? Or what are you aiming for?   Andy : High views and high showings. That's the best. Everybody's looking at it. People are coming. Okay. There's other tests down the road because traditionally if you get 16 to 18 showings and nobody makes an offer, you're still probably overpriced, but that's very unlikely. Okay.   Andrew Stotz: And is price the only factor that you can adjust here, let's say high views, high showings could be just the type of house, the location, but you don't necessarily control those things?   Andy : No, the one down near the bottom. Low views, high showings. It's ikely a niche piece of property. Not many people are looking at it, but the people that want that niche, whatever may be different, it's a unique piece of property, they'll get a lot of showings relative to their views, because most people aren't interested. But there isn't much else we can do because we spend... We pay for staging. We don't pay for it. We do it. We have our own inventory and staging. We have contractors that we've used for years to help get a house ready. So the product itself, the house, and the presentation, there's never much more we can do to make that better.   Andrew Stotz: And quality in the eyes of the customer is the best price sold quickly, I guess.   Andy : Yes. Yeah. That's right. There's a saying which not everybody agrees with in the real estate industry, but you want to make the most amount of money in the least amount of time with the least amount of hassle.   Andrew Stotz: I think that's everywhere.   Andy : That's true.   Andrew Stotz: Yes. I want that. Great.   Andy : That's what everybody wants, but some people say, well, if it's too fast, you didn't... But that's usually not true. Fast is usually good as long as it's priced right. The next chart I have is a whole other way we use control charts, and that's to evaluate our own performance, which is what this is doing. And it's using sales-to-list price ratios. In other words, what percentage of the list price was the sales? And here we're using a long base period, and I'm just going to back up for a second. In some of the two recent, the ones I did on price drops and supply of inventory, we only had a year worth of, for the base line. And normally it's better to use more than that, but those two years I used were stable, and we didn't go back further because the Fed had been raising interest rates, and that created a... That was not a stable market when they did that, so we didn't want to use that as a history.   Andy : So this is showing our performance, and you can see starting with the pandemic, we went way above the control limits a lot of times. But what you do when you're looking at or using a chart like this for your own improvement is you want to narrow the upper and lower control limits, the two red lines. The closer they get together, the less variation you have, the smaller your standard deviation. And for us, it's 0.2. And our range between what... That's normal is between 95% and 107% of the sales price. And just to how we use it and how we get better at it is we focus on pricing. We focus on improving negotiation, which is a big deal, especially in the last few years. We are always looking to improve our client base. We're always looking to improve our preparation and presentation. We think we got that pretty well down pat. And the other thing is to stay within your area of expertise, because when you go out of that, okay, if I was to work on a house out of my market, okay, I wouldn't get this kind of performance. So that's going to lead me to the next and really the final chart. And that's another group, okay? And I'm using this group because... Just to...   Andrew Stotz: Sorry, when you say another group, what do you mean?   Andy : It's not my team, no offense industry...   Andrew Stotz: So it's a competitor or it's...   Andy : This is a well-known group. It's led by two Ivy League graduates. And it's a much bigger team than ours. Their standard... And it's the same base period, 2017 to '19. Their standard deviation is three times what ours is. Their range of what they do within the control limits is 78% to 114%. And that... Why do we do this? Why do we care? It's always nice to benchmark yourself. But most of all, with groups or agents that we compete with, if these guys put a house on the market, okay, and we thought it was overpriced, or let's say we thought it was underpriced, okay, and it was competing with one of ours, we wouldn't tell our client to reduce their price to match their price, okay, because we know they probably are underpricing. In this case, we'd say let it go. Likewise, if we're working with a buyer who's buying one of their houses and we think it's overpriced, what their listing is overpriced, then we will probably make a lower offer knowing that they also know that their pricing can be way off. So understanding your clients and where they fit on these control charts is useful information.   Andrew Stotz: And I can imagine that some people, let's say, at another firm, as an example, may say, oh, I don't care about this variability because one side of the mean is more favorable than the other, so I'm just trying to get to that other side. Whereas what you're saying is I'm trying to reduce variation around the mean.   Andy : Yes, and that'll take me to this last section I have here. If we compare the two groups, what are the major differences? Number one, if it was a million-dollar listing, okay, we would probably get $43,000 more than they would based on these control charts. Most of all, the biggest difference...   Andrew Stotz: The selling price of your customer would be $43,500 more?   Andy : Well, our average selling price is a little over 100%. Their average selling price is 96%. So on average, they're getting $43,000 less on $1 million house than we are. But the most important thing in this is the consistency and the predictability of when you lower those control chart limits, you're making your performance much more predictable, and it's an important part to all of our clients. I mean, Deming had a... One of the things he used to say is quality is in the customer's eyes, not your eyes. So I can say we do all this great stuff and all that. It all boils down to what does the customer think. And when a group's working on volume, which is pretty typical in our industry, that's what we're taught, how to get more volume, how to get more volume, that's... The customer doesn't care. The client doesn't care about what kind of volume they do. What the customer cares about is service. And you can see some of the other things, consistency over time, process control and all that. I'll get out of here now and say that that's really what control charts and Deming's philosophy and the PDSA, it all focuses on quality in the customer's eyes, consistent performance, better service, and not a lot of guesswork. We're using data that other agents don't even know exists. And that's unfortunately not an exaggeration, really. I've never talked to anybody that knew about this.   Andrew Stotz: When Deming talked about quality, he often referenced the idea that you could have a quality system in place and still go out of business if you weren't looking at quality in the eyes of the customer and being completely connected to the customer. And I have a little story on this from my coffee business. Many years ago, we had a restaurant chain in Thailand that's a global chain come to us and we won the bid. And they said, we chose you over all these other suppliers for coffee and we're going to come to your factory and when we do, we're going to do an audit, we're going to ask 600 questions and if you get below 75% or whatever, you're fired. But, hey, I knew Deming and I knew all of this stuff and we cared about quality and we never had quality problems, so we thought we're in good shape. And they came out and they said, your score was 68, you're fired. You have six weeks to fix it or you won't be our supplier. Well, we learned something very quickly there, which was to them, paperwork was quality.   Andrew Stotz: And that was a quality system to them that meant that we had quality. And so we had a passion for quality, but we didn't have the paperwork system that they wanted. So luckily, when you have passion for quality, it's pretty easy to overlay a paperwork system on it, if that's what the customer required. I would hate to be in the opposite situation where you go and do like many people when they go and get certified or ISO or whatever and they build a paperwork system without that commitment to quality. Now, that's a disaster. But the point is that we had to realize that in order for us to satisfy that customer's needs, we had to appeal to quality as they saw it. And so we've got to always keep the customer in mind as we're working on our quality.   Andy : I got another story. My wife reminded me today that sometimes in probably early '80s, maybe mid '80s at the latest, I looked up in the... I wanted to find a statistician and I looked him up in the yellow pages, which a lot of the listeners may not know what that is. And I wanted to... What I wanted to do was find a way to improve, optimize our inventory and try to approach just-in-time inventory because we had factories all over the place and we were getting stuff in. And we never did it. And I imagine with Dr. Deming, we could have done it, but we never did it because exactly the quality's in the customer's eyes. We were shipping to specialty restock stores primarily, and if we couldn't stock their shelves, okay, they went somewhere else. Didn't matter how much they liked us, they had to have those shelves full. So we decided it wasn't worth the risk of just-in-time and optimizing our inventory at the expense of having maybe too much inventory, but satisfying our customers. And it's just so true.   Andrew Stotz: Yeah. Yeah. In the story that I told, that particular chain never ran out of product and certainly never ran out of coffee. And I know myself, being a customer of that chain, never in my life did I walk in there and they ran out of a particular product. And they made that very clear. That's quality to us is that our supply chains are never broken. And for 16 years, we never broke their supply chains. It was never the case. So in the eyes of the customer, well, on behalf of everyone at the Deming Institute, I want to thank you again for this discussions and for listeners, remember to go to Deming.org to continue your journey. But I thought I would leave the closing comments to you to maybe wrap up and give the audience what you think should be their main takeaway from this discussion.   Andy : I think probably the main takeaway would be that Dr. Deming's philosophy, the Profound Knowledge, everything he taught is as relevant to real estate, okay, pricing, probably most markets as it is to a factory or production or anything like that. I think that it took me a while, after I became a realtor, it took me a while to realize, wow, all these things we can use. And we have more data to play with than anybody. So that's a good takeaway for anybody, especially realtors.   Andrew Stotz: Yeah, I think, and I'll just add on, I enjoyed the conversation because I love Michael Porter's stuff and talking about figuring out where's your niche and trying to bring a differentiated offering to the market. And that differentiated offering could be based on what I like to say from my study and teaching of corporate strategy is there's kind of two main corporate strategies. One I would say is the type that engineers build, which is an operational corporate strategy. And another one is a differentiating strategy that a sales type of person would build, which is about the interaction with sales, with the product and all of that. And so with Dr. Deming, one of the benefits we get is the process part of our business can just be improved forever. And then we can overlay that with whatever we want from what we bring to the market. And I think you've given us an example of how you can apply Deming's principles to the process of your business and do that in a niche area or an area that you've defined and dominate. And so I love that.   Andy : Yeah, and one of the things, just a last thought, is something you and I had talked about, is you don't have to have a PhD in physics or you don't have to get a doctorate in something to understand Deming. And he even says it in his book. You don't have to be an expert in any of it. You just have to understand it. And that's the beauty of it. Anybody can do what I'm doing with just nowhere near the effort you'd have to do if you were going to be a physicist or something else like that. And that's something people can take away.   Andrew Stotz: And on that hopeful note, this is your host, Andrew Stotz, and I'm going to leave you with one of my favorite quotes from Dr. Deming. I always repeat it because it's such a great quote, and that is, "people are entitled to joy in work."      

How was Dirt not watching the FedEx Cup Playoffs? Michael Porter, Jr. on sports gambling. A potential World Series/College Football scheduling conflict. How a 12-team playoff would look with the current AP preseason poll. Patrick went to the Creed show. Tiersday: sports bucket list. Adam Gold of the Adam Gold Show in Raleigh & the Canes Corner Podcast talks new Blazers owner Tom Dundon, and drops some BOMBS.

Pete Alonso becomes the Mets all-time HR leader. | Travis Kelce is motivated this season after a mediocre last season. | Eric Edholm from NFL Media joins JR to talk all things football. | Michael Porter say a whole lot of stupid things. |

How was Dirt not watching golf this morning? Michael Porter, Jr. on sports gambling. A potential World Series/College Football conflict. What a 12-team playoff looks like under this AP preseason poll.

Strategi bukan cuma sekadar rencana, tapi juga cetak biru keberhasilan organisasi. Para pakar punya pandangan unik: dari Michael Porter dengan posisi unik dan keunggulan kompetitif, hingga Henry Mintzberg yang melihatnya sebagai "pola dalam aliran keputusan". Ada juga Peter Drucker yang menanyakan "Apakah bisnis kita?" dan Alfred Chandler Jr. yang fokus pada tujuan jangka panjang serta alokasi sumber daya. H. Igor Ansoff punya matriks pertumbuhan, sementara Gary Hamel dan C.K. Prahalad memperkenalkan "strategic intent" sebagai impian ambisius. Jangan lupa, Richard Rumelt punya empat kriteria evaluasi yang solid, dan Seth Godin memandangnya sebagai "kerja keras memilih apa yang harus dilakukan hari ini untuk meningkatkan hari esok." Jadi, strategi itu dinamis, butuh pemikiran mendalam, dan yang terpenting: eksekusi! Nah, bagaimana merumuskannya? Prosesnya berkelanjutan dan iteratif! Dimulai dengan visi, misi, dan tujuan yang jelas. Lalu, kita analisis lingkungan eksternal (peluang & ancaman) dan internal (kekuatan & kelemahan). Dari situ, kita pilih alternatif strategi yang paling pas, kembangkan rencana strategis detail, dan implementasikan dengan alokasi sumber daya yang tepat. Terakhir, yang tak kalah penting, evaluasi dan kontrol secara berkala untuk pastikan strategi tetap relevan dan kompetitif. Ini bukan cuma tentang membuat rencana, tapi juga tentang adaptasi dan perbaikan terus-menerus! Untuk membantu analisis, kita punya alat canggih! Ada SWOT yang bantu kita identifikasi kekuatan, kelemahan, peluang, dan ancaman. Lalu, Lima Kekuatan Porter untuk membedah struktur industri dan intensitas persaingan(pikirkan ancaman pendatang baru, produk pengganti, daya tawar pembeli dan pemasok, serta persaingan internal). Dan untuk gambaran yang lebih luas, ada PESTEL yang melihat faktor Politik, Ekonomi, Sosial, Teknologi, Lingkungan, dan Hukum. Dengan kerangka kerja ini, perusahaan bisa merancang strategi yang efektif, mengelola risiko, dan responsif terhadap perubahan lingkungan, demi kesuksesan jangka panjang. Siap untuk menyelami dunia strategi lebih dalam? #PodcastStrategi #Bisnis #Manajemen #Inovasi #Kesuksesan

A single dad of four in Columbus, Georgia, Michael Porter started listening to The Redeemed Man podcast two years ago and ended up becoming a leader of the ministry's small online groups. In this week's episode, Michael talks to Nate Dewberry about what he's learned from other men along his way—the importance of community, the need for accountability, and the lies we believe that distance us from God.Segments/chapters0:00 Intro1:41 How Michael first connected with The Redeemed6:23 Stepping into a new role as a small group leader14:24 The unique limitations and blessings of online community26:09 Surprises and revelations from building relationships with a diverse group of men32:33 Each group at The Redeemed is unique36:45 What does redemption mean to you?42:53 Michael's hopes for the futureVisit The Redeemed's website for downloadable discussion question sets, show notes, inspirational articles, more resources, or to share your testimony.Join our Exclusive Newsletter: Signup today and be the first to get notified on upcoming podcasts and new resources!The Redeemed is an organization giving men from all backgrounds a supportive, judgment-free environment, grounded in Christian love without demanding participation in any faith tradition, where they can open up about their challenges, worries, and failures—and celebrate their triumphs over those struggles. Have a redemption story? Share your redemption story here. Interested in being a guest on our podcast? Email Nate@theredeemed.com Follow The Redeemed on Social Media: Podcast YouTube Facebook Instagram LinkedIn Twitter

In this week's mini-episode we discuss the concept of systematic abandonment, a mental model co-opted from business strategists like Peter Drucker and Michael Porter. Systematic abandonment teaches us to periodically review and discard habits that are no longer useful, because deciding what not to do is often just as (if not more) important than deciding what to do.Get our Intro to Mechanics audio course, normally $79, FREE:https://bjjmentalmodels.com/freeintroDon't forget to check out BJJ Mental Models Premium!If you love the podcast, you'll definitely love our premium membership offerings. The podcast is truly just the tip of the iceberg – the next steps on your journey are joining our community, downloading our strategy courseware, and working with us to optimize your game. We do all this through memberships that come in at a fraction of the cost of a single private.Sign up here for a free trial:https://bjjmentalmodels.com/Need more BJJ Mental Models?Get tips, tricks, and breakthrough insights from our newsletter:https://bjjmentalmodels.com/newsletter/Get nitty-gritty details on our mental models from the full database:https://bjjmentalmodels.com/database/Follow us on social:https://facebook.com/bjjmentalmodels/https://instagram.com/bjjmentalmodels/

Episode 131 von ‚vom Parkplatz‘, Cam Johnson zu den Nuggets, dafür Michael Porter zu den Nets, Dennis Schröder zu den Kings. Die Free Agency hatte dann doch einiges zu bieten, inkl. ein paar Trades. Wir sprechen drüber und ordnen ein. __________________ Folgt uns gerne auf Instagram, TikTok und auf X  

Why most growth plans fail is simple: leaders can't connect the dots between strategy, execution, and people. Shannon Susko learned this the hard way, and then did something extraordinary about it. She created Metronomics, a strategic growth operating system that aligns teams, drives execution, and helps CEOs finally get out of the weeds. In this episode of Reflect Forward, Shannon shares how Metronomics was born out of desperation when she was on the brink of being fired. Her bold move? Ditching vague 10-year visions for a Three-Year Highly Achievable Goal (3HAG), a clear, actionable roadmap that brought her board back onside, rallied her team, and ultimately transformed her business. “When you delegate, you still own it. But if you empower people to build a plan with you and own their pieces—that's when real execution happens.” Inside This Episode: • How a 3HAG connects strategy to execution and earns board confidence • Why most CEOs are stuck in whack-a-mole mode and how to escape it • How 15-minute daily huddles saved Shannon 40 hours a week • Why clarity and cadence beat complexity every time • How to cascade strategy out (not down) across the entire organization Shannon draws from the best, Jim Collins, Michael Porter, Vern Harnish, and Jack Stack, and weaves it into a rigorous and human system. She breaks down what most leaders get wrong about scaling and how to build a rhythm that turns big goals into achievable outcomes. Mic Drop Moment “This system allowed me to stop working in the business and start working on it. That's how I exited two companies—and why I coach CEOs today.” Start Here Ready to grow with intention? Start with Shannon's book The M Game, a short, high-impact read that introduces Metronomics in under 100 pages. You can also visit metronomics.com to find a coach, explore tools, or connect directly with Shannon. If this episode sparked an idea, share it with a fellow leader. Subscribe to Reflect Forward on YouTube or your favorite podcast app, and don't forget to leave a review—it helps us get these game-changing conversations into more hands. How to find Shannon: LinkedIn: https://www.linkedin.com/in/shannonbyrnesusko/ Website: https://www.metronomics.com/ You Tube: https://www.youtube.com/channel/UCtfKz1miyfoNlX9RYvtQx-A Connect with Kerry Don't forget to subscribe to Reflect Forward on your favorite podcast platform or YouTube. Visit my website, kerrysiggins.com, to explore my book, The Ownership Mindset, and get more leadership resources. Let's connect on LinkedIn, Instagram, or TikTok! Find Reflect Forward on YouTube: https://www.youtube.com/@kerrysiggins-reflectforward Find out more about my book here: https://kerrysiggins.com/the-ownership-mindset/ Connect with me on LinkedIn: https://www.linkedin.com/in/kerry-siggins/

This week's podcast is about fragmented industries. And other industry structures that are overly competitive. It summarizes a lot of Michael Porter's writing on this subject.You can listen to this podcast here, which has the slides and graphics mentioned. Also available at iTunes and Google Podcasts.Here is the link to the TechMoat Consulting.Here is the link to our Tech Tours. -------------I write, speak and consult about how to win (and not lose) in digital strategy and transformation.I am the founder of TechMoat Consulting, a boutique consulting firm that helps retailers, brands, and technology companies exploit digital change to grow faster, innovate better and build digital moats. Get in touch here.My book series Moats and Marathons is one-of-a-kind framework for building and measuring competitive advantages in digital businesses.This content (articles, podcasts, website info) is not investment, legal or tax advice. The information and opinions from me and any guests may be incorrect. The numbers and information may be wrong. The views expressed may no longer be relevant or accurate. This is not investment advice. Investing is risky. Do your own research.Support the show

LA Clippers vs. Denver Nuggets NBA Pick Prediction by Tony T. Clippers at Nuggets Injuries LA has a clean injury report. Westbrook is questionable for Denver. Recent Box Score Key Stats Clippers at Nuggets 10PM ET—Denver evened this series at 2-2 after their 101-99 road win at LA. The Nuggets shot 46% with 34% from three. Nikola Jokic scored 36 points with 21 rebounds. Michael Porter got 17 points with four rebounds. LA hit 44% with 33% from three. Kawhi Leonard produced 24 points with nine rebounds. Norman Powell supported with 22 points and four rebounds.

In today's show Riley has the latest export sales with Greg McBride of Allendale,  Dustin speaks with Michael Porter of John Deere about John Deere's latest autonomy update, and Andy has a featured conversation with Lance Rupert of Growmark.

In today's show Dustin speaks with Michael Porter of John Deere about John Deere's latest autonomy update, Riley is joined by Shelby Schaa of Pioneer to learn about Z-Series soybean performance, and Dustin speaks with David Elser of UPL.

In this seventh episode of the “Buy: The Way…To Purposeful Procurement” podcast series, Art of Procurement's Philip Ideson and Fine Tune CEO Rich Ham take a deep dive into procurement history with Kate Vitasek, Faculty of Graduate and Executive Education at the University of Tennessee, and architect of the groundbreaking Vested methodology.  With over 15 years of research and eight books dedicated to buyer-supplier strategic partnerships, Kate shares her insight into how procurement has traditionally tended to extract value from suppliers through power plays, as opposed to creating value through collaboration and alignment around mutually ‘Vested' interests. She traces the historical roots of this dysfunction back to the 1980s with the rise of the Kraljic Matrix and Michael Porter's competitive strategies, both of which further embedded power-based negotiations into procurement's DNA. Drawing inspiration from the Vested approach, Kate:  Advocates for moving away from transaction-based buyer-seller relationships to outcome-based strategic partnerships where both parties have a genuine vested interest in one another's mutual success, and  Explains this dynamic by sharing examples of organizations that have transformed their supplier relationships by transforming how they measure success, structure contracts, and distribute value across their supplier network. This episode challenges procurement to recognize when they're spinning their wheels with outdated supplier management tactics and encourages them to reimagine what's possible when buyers and suppliers align their interests toward genuine value creation and purpose-driven procurement. Links: Kate Vitasek on LinkedIn Rich Ham on LinkedIn Learn more at FineTuneUs.com  

Memphis Grizzlies vs. Denver Nuggets NBA Pick Prediction by Tony T. Grizzlies at Nuggets Injuries Pullin and Wells are out for Memphis. Murray is doubtful for Denver. Recent Box Score Key Stats Grizzlies at Nuggets 9PM ET—Memphis is on a back-to-back after losing at home to Minnesota on Thursday. Denver improved to 48-32 following their 124-116 rod win at Sacramento. The Nuggets shot 50% with 38% from three. Christian Braun produced 25 points with four rebounds. Michael Porter chipped in with 21 points and five rebounds. Denver allowed 47% shooting to the Kings with 44% from three.

Indiana Pacers vs. Denver Nuggets NBA Pick Prediction by Tony T. Pacers vs. Nuggets Injuries Indiana has a clean injury report. Murray is questionable for Denver. Recent Box Score Key Stats Pacers at Nuggets 8PM ET—Indiana improved to 46-31 following their 140-112 home victory to Utah. The Pacers shot 57% with 38% from three. Myles Turner scored 26 points with seven rebounds. Pascal Siakam chipped in with 22 points and five rebounds. Indiana allowed 38% shooting to the Jazz with 31% from three. Denver fell to 47-31 with their 118-104 road defeat to Golden St. The Nuggets shot 54% with 39% from three. Nikola Jokic scored 33 points with 12 rebounds. Michael Porter got 23 points with nine rebounds. Denver allowed 49% shooting to the Warriors with 42% from three.

Minnesota Timberwolves vs. Denver Nuggets NBA Pick Prediction by Tony T. Timberwolves at Nuggets Injuries Shannon is out for Minnesota. Strawther is out for Denver with Murray and Gordon questionable. Braun and Jokic are probable. Recent Box Score Key Stats Timberwolves at Nuggets 10PM ET—Minnesota improved to 43-32 following their 123-104 home victory to Detroit. The Timberwolves shot 47% with 39% from three. Julious Randle got 26 points with eight rebounds. Anthony Edwards contributed 25 points with six rebounds. Minnesota allowed 38% shooting to the Pistons with 32% from three. Denver improved to 47-28 following their 129-93 home victory to Utah. The Nuggets hit 58% with 38% from three. Nikola Jokic scored 27 points with 14 rebounds. Michael Porter contributed 20 points and four assists. Denver allowed 35% shooting to the Jazz with 18% from three.

Utah Jazz vs. Denver Nuggets NBA Pick Prediction by Tony T. Jazz at Nuggets Injuries Collins, Markkanen and Harkless are out for Utah. Strawther is out with Murray questionable for Denver. Braun, Gordon, Jokic, and Porter are probable. Recent Box Score Key Stats Jazz at Nuggets 9PM ET—Utah drops to 16-58 with their 121-110 home defeat to Houston. The Jazz shot 54% with 48% from three. Collin Sexton scored 21 points with five assists. Keyonte George off the bench had 17 points and eight assists. Utah allowed 46% shooting to the Rockets with 32% from three. Denver improved to 46-28 following their 127-117 home victory to Milwaukee. The Nuggets shot 54% with 43% from three. Nikola Jokic scored 39 points with a Triple Double. Michael Porter contributed 23 points with 10 rebounds. Denver allowed 52% shooting to the Bucks with 43% from three.

Chicago Bulls vs. Denver Nuggets NBA Pick Prediction by Tony T. Bulls at Nuggets Injuries Ball and Jones are out for Chicago. Strawther is out with Jokic doubtful for Denver. Recent Box Score Key Stats Bulls at Nuggets 9PM ET—Chicago improved to 31-40 following their 146-115 road win at LA Lakers. The Bulls shot 58% with 46% from three. Coby White scored 36 points with three rebounds. Matas Buzelis chipped in with 31 points and two rebounds. Chicago allowed 48% shooting to the Lakers with 41% from three. Denver defeated Houston 116-111 on the road. The Nuggets shot 51% with 48% from three. Jamal Murry got 39 points with seven assists. Michael Porter pitched in with 17 points with nine rebounds. Denver allowed 44% shooting to the Rockets with 32% from three.

Denver Nuggets vs. Houston Rockets NBA Pick Prediction by Tony T. Nuggets at Rockets Injuries Jokic and Strawther are out for Denver. Braun, Gordon and Murray are questionable. Sheppard is our for Houston. Recent Box Score Key Stats Nuggets at Rockets 7PM ET—Denver fell to 44-27 following their 128-109 road defeat to Portland. The Nuggets shot 50% with 35% from three. Aaron Gordon scored 23 points with four assists. Michael Porter chipped in with 17 points and five rebounds. Denver allowed 54% shooting to the Trailblazers with 40% from three. Houston improved to 46-25 after their 102-98 road win at Miami. The Rockets hit 46% with 50% from three. Fred VanVleet got 37 points with three assists. Amen Thompson chipped in with 18 points and nine rebounds. Houston allowed 52% shooting to the Heat with 42% from three.

Denver Nuggets vs. Portland Trailblazers NBA Pick Prediction by Tony T. Nuggets at Trailblazers Injuries Jokic and Strawther are out for Denver with Murray questionable. Braun and Gordon are probable. Ayton, Walker and Williams are out for Portland with Grant doubtful. Recent Box Score Key Stats Nuggets at Trailblazers 10PM ET—Denver drops to 44-26 following their 120-108 road defeat to LA Lakers. The Nuggets shot 47% with 33% from three. Aaron Gordon got 26 points with 11 rebounds. Michael Porter chipped in with 12 points and four rebounds. Denver allowed 51% shooting to the Lakers with 42% from three. Portland improved to 31-39 with their 115-99 home victory to Memphis. The Trailblazers hit 42% with 39% from three. Deni Avdija scored 31 points with 16 rebounds. Anfernee Simons got 31 points with 16 rebounds. Portland allowed 40% shooting to the Grizzlies with 27% from three.

Denver Nuggets vs. LA Lakers NBA Pick Prediction by Tony T. Nuggets vs. Lakers Injuries Strawther is out with Braun, Jokic and Murray questionable for Denver. Gordon is probable. James, Hachimura and Kleber are out for LA. Jemison is questionable with Luka probable. Recent Box Score Key Stats Nuggets at Lakers 10PM ET—Denver improved to 44-25 following their 114-105 road win at Golden St. The Nuggets shot 47% with 36% from three. Aaron Gordon scored 38 points with six rebounds. Michael Porter posted 21 points with 10 rebounds. Denver allowed 49% shooting to the Warriors with 24% from three. LA is 42-25 with their 125-109 home victory to San Antonio. The Lakers hit 49% with 40% from three. Austin Reaves posted 30 points with seven rebounds. Luka contributed 21 points with 14 assists. LA allowed 47% shooting to the Spurs with 39% from three.

The Nuggets won one and lost two games to Western Conference playoff teams. Miroslav is joined by Brendan Vogt of the DNVR and Rayvone Hackshaw of the 4 Corners Denver Nuggets Podcast to talk about: - Blowout loss and a blowout win versus the Thunder. What was good, and   what was bad in both games?- How real is the March exhaustion? Is Jokić playing 37 mpg until New Year    biting the Nuggets on their behind?- Jamal Murray and Michael Porter Jr. disaster class versus the Wolves- Which Nuggets are Matchup proof?- Memphis, Lakers, Houston, Golden State, Timberwolves, Clippers.    Which are the best and worst first-round matchups for the Nuggets? Support the show: https://Patreon.com/miroslavcuk      An ALLCITY Network Production  PARTY WITH US: https://thednvr.com/events  ALL THINGS DNVR: https://linktr.ee/dnvrsportsSubscribe:    YouTube.com/dnvr_sports  

Denver Nuggets vs. Oklahoma City Thunder NBA Pick Prediction by Tony T. Nuggets vs. Thunder Injuries Strawther is out with Gordon doubtful for Denver. Mitchell is out for OKC. Recent Box Score Key Stats Nuggets at Thunder 8PM ET—Denver drops to 41-23 following their 127-103 road defeat to Oklahoma City. Nuggets shot 41% with 30% from three. Nikola Jokic scored 24 points with 13 rebounds. Michael Porter chipped in with 24 points with 15 rebounds. Denver allowed 49% shooting to the Thunder with 34% from three. SGA scored 40 points with eight rebounds. Jalen Williams put up 26 points with nine rebounds.

In this episode of Walk Talk Listen, Maurice Bloem sits down with Nikhil Bumb to discuss his journey from engineering to corporate social impact. Nikhil shares his upbringing as a South Asian American born in Wyoming and raised in South Carolina, describing how his family's immigrant experience and Jain faith shaped his worldview. He reflects on the challenges of growing up as part of a minority community, navigating cultural and religious differences, and finding his own identity. Nikhil also delves into his academic path, studying electrical engineering at Princeton University and later pursuing graduate studies at Georgia Tech, before transitioning from the technical field into a career centered on purpose-driven business strategies. His passion for making an impact led him to work with Medtronic, Deloitte, and Technoserve before settling into his current role at FSG, where he supports companies in creating equitable, purpose-driven models of growth.   The conversation moves into the intersection of business, leadership, and social change, as Nikhil discusses the evolving role of corporations in tackling global issues. He introduces the concept of 'shared value,' advocating for companies to integrate social impact into their core strategies, rather than treating it as a separate philanthropic endeavor. Maurice and Nikhil explore the challenges of implementing these changes, the necessity of shifting organizational culture, and the increasing recognition of systems thinking and conscious leadership in today's business world. They also discuss the role of inner development and personal growth in achieving broader systemic change, touching upon frameworks like the Inner Development Goals (IDGs) and their relevance to business and sustainability efforts. Nikhil emphasizes the importance of seeing businesses not just as economic engines, but as key players in shaping a more inclusive and sustainable society.   Nikhil Bumb is a managing director at FSG, a nonprofit consulting firm founded by Michael Porter and Mark Kramer that helps organizations drive social change through equitable systems transformation. He leads the firm's corporate impact work in the U.S., working with businesses to embed purpose into their strategies while achieving commercial success. With a background in engineering and an MBA, Nikhil brings a blend of analytical expertise and strategic vision to his work. He also serves on the board of the Parliament of the World's Religions, where he champions interfaith dialogue and social justice initiatives. His experiences in interfaith engagement, corporate strategy, and systems-level thinking make him a compelling advocate for reshaping leadership and business models to meet the challenges of today's world.   Listener Engagement: Discover more about Nikhil via his LinkedIn profile and Instagram. Check the FSG website and LinkedIn profile as well. Share your thoughts on this episode via walktalklisten. Your feedback is invaluable to us. Explore the songs selected by Nikhil and other guests on our #walktalklisten playlist here. Follow Us: Support the Walk Talk Listen podcast and Maurice by liking and following Maurice on Blue Sky, Facebook and Instagram. Visit our website at 100mile.org for more episodes and information about our initiatives. Check out the special WTL series "Enough for All," featuring Church World Service (CWS) and the work of the Joint Learning Initiative (JLI).

很多时候，我们总认为做得越多，收获越大，却忽略了精力和资源的有限性。盲目地追求面面俱到，反而会分散精力，一事无成。真正的战略高手，懂得在复杂的局面中甄别，明确哪些是无关紧要的，哪些才是关乎成败的关键。学习英语，也是如此，背再多单词，看似每天都有收获，有充实感。但你是否考虑到它对你实际的口语的帮助呢？你能否将你背诵的每一个单词灵活英语在自己的口语当中呢？所有高手和学霸，都会选择将精力和资源集中投入到最有价值的事情上，因为只有这样，才能高效解决问题，让自己达成所愿。今天我们分享一句这样的名言，思考学会选择不做什么，才是开启通往成功说出地道口语的根本。迈克尔·波特（Michael E.Porter，1947—），男，哈佛商学院大学教授（大学教授，University Professor，是哈佛大学的最高荣誉，迈克尔·波特是该校历史上第四位获得此项殊荣的教授）。迈克尔·波特在世界管理思想界可谓是“活着的传奇”，他是当今全球第一战略权威，是商业管理界公认的“竞争战略之父”，在2005年世界管理思想家50强排行榜上，他位居第一。Quote to learn for todayThe essence of strategy is choosing what not to do.—Michael Porter翻译战略的精髓在于选择不做什么。— 迈克尔・波特25期爱趣英文开启限额招募，跟着卡卡老师彻底摆脱懒癌，全面系统提升！公众号：卡卡课堂 卡卡老师微信：kakayingyu001

Denver Nuggets vs. Boston Celtics NBA Pick Prediction by Tony T. Nuggets at Celtics Injuries Watson and Cancar are out for Denver. Gordon and Nnaji are questionable. Porzingis and Holiday are doubtful for Boston with Brown questionable. Recent Box Score Key Stats Nuggets at Celtics 1PM ET—Denver improved to 39-21 following their 134-119 road win at Detroit. The Nuggets shot 56% with 55% from three. Jamal Murray scored 31 points with four assists. Michael Porter pitched in with 28 points and nine rebounds. Denver allowed 45% shooting to the Pistons with 32% from three. Boston fell to 42-18 with their 123-116 home defeat to Cleveland. The Celtics hit 48% with 44% from three. Jayson Tatum posted 46 points with 16 rebounds. Jaylen Brown contributed 37 points with five rebounds. Boston allowed 48% shooting to the Cavs with 44% from three.

Denver Nuggets vs. Phoenix Suns NBA Pick Prediction by Tony T. Nuggets at Suns Injuries Westbrook, Watson and Cancar are out for Denver. Porter and Murray are questionable with Gordon probable. Beal, Martin and Micic are out for Phoenix with Durant questionable. Recent Box Score Key Stats Nuggets at Suns 3PM ET—Denver improved to 33-19 following their 112-90 home victory to Orlando. The Nuggets shot 53% with 40% from three. Michael Porter scored 30 points with seven rebounds. Nikola Jokic chipped in with 28 points and a Triple Double. Denver held Orlando to 37% shooting with 16% from three. Phoenix is 26-25 with their 135-127 home victory to Utah. The Suns shot 45% with 39% from three. Devin Booker scored 47 points with 11 assists. Grayson Allen contributed 21 points with seven rebounds. Phoenix held Utah to 41% shooting with 27% from three.

Orlando Magic vs. Denver Nuggets NBA Pick Prediction by Tony T. Magic at Nuggets Injuries Suggs is out for Orlando. Westbrook, Cancar and Watson are out for Denver. Recent Box Score Key Stats Magic at Nuggets 9PM ET—Orlando improved to 25-27 following their 130-111 road win at Sacramento. Magic shot 57% with 52% from three. Franz Wagner scored 31 points with five rebounds. Paolo Banchero put up 23 points with nine assists. Orlando allowed 50% shooting to the Kings with 37% from three. Denver is 32-19 following their 144-119 home victory to New Orleans. The Nuggets hit 57% with 37% from three. Michael Porter scored 39 points with 12 rebounds. Nikola Jokic chipped in with 38 points and ten assists. Denver allowed 48% shooting to the Pelicans with 34% from three.

New Orleans Pelicans vs. Denver Nuggets NBA Pick Prediction by Tony T. Pelicans at Nuggets Injuries Ingram and Jones are out for New Orleans with Theis questionable. Watson, Westbrook and Cancar are out for Denver with Gordon questionable. Recent Box Score Key Stats Pelicans at Nuggets 9PM ET—New Orleans fell to 12-38 following their 125-113 road defeat to Denver. The Pelicans shot 43% with 47% from three. CJ McCollum scored 30 points with six rebounds. Trey Murphy put up 41 points with three assists. Denver shot 50% with 36% from three. Nikola Jokic got 27 points with a Triple Double. Michael Porter contributed 36 points with seven rebounds. Denver improved to 31-19 in victory.

On the latest episode of Pickaxe and Roll, Ryan Blackburn reacts to the Denver Nuggets 125-113 win over the New Orleans Pelicans. It wasn't a perfect game, but the Nuggets were comfortable throughout, especially with 36 points from Michael Porter Jr. last night. Zeke Nnaji also started in place of Aaron Gordon and gave Denver surprisingly great minutes vs Zion Williamson. After the game, Michael Malone also declared the Nuggets would not trade Michael Porter this deadline. Ryan discusses the win, Nikola Jokic and Jamal Murray, Zeke's impressive game, and more. BETONLINE: The Game Starts Here! https://www.betonline.ag

Join host Andrew Stotz for a lively conversation with Cliff Norman and Dave Williams, two of the authors of "Quality as an Organizational Strategy." They share stories of Dr. Deming, insights from working with businesses over the years, and the five activities the book is based on. TRANSCRIPT 0:00:02.2 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we dive deeper into the teachings of Dr. W. Edwards Deming. Today, we have a fantastic opportunity to learn more about a recent book that's been published called "Quality as an Organizational Strategy". And I'd like to welcome Cliff Norman and Dave Williams on the show, two of the three authors. Welcome, guys.   0:00:27.1 Cliff Norman: Thank you. Glad to be here.   0:00:29.4 Dave Williams: Yeah, thanks for having us.   0:00:31.9 Andrew Stotz: Yeah, I've been looking forward to this for a while. I was on LinkedIn originally, and somebody posted it. I don't remember who, the book came out. And I immediately ordered it because I thought to myself, wait, wait, wait a minute. This plugs a gap. And I just wanna start off by going back to Dr. Deming's first Point, which was create constancy of purpose towards improvement of product and service with the aim to become competitive and stay in business and to provide jobs. And all along, as anybody that learned the 14 Points, they knew that this was the concept of the strategy is to continue to improve the product and service in the eyes of the client and in your business. But there was a lot missing. And I felt like your book has started really to fill that gap. So maybe I'll ask Cliff, if you could just explain kind of where does this book come from and why are you bringing it out now?   0:01:34.5 Cliff Norman: That's a really good question, Andrew. The book was originally for the use of both our clients only. So it came into being, the ideas came out of the Deming four day seminar where Dr. Tom Nolan, Ron Moen and Lloyd Provost, Jerry Langley would be working with Dr. Deming. And then at the end of four days, the people who some of who are our clients would come up to us and said, he gave us the theory, but we don't have any methods. And so they took it very seriously and took Dr. Deming's idea of production viewed as a system. And from that, they developed the methods that we're going to discuss called the five activities. And all of our work with this was completely behind the wall of our clients. We didn't advertise. So the only people who became clients were people who would seek us out. So this has been behind the stage since about 1990. And the reason to bring it out now is to make it available beyond our client base. And Dave, I want you to go ahead and add to that because you're the ones that insisted that this get done. So add to that if you would.   [laughter]   0:02:53.0 Dave Williams: Well, thanks, Cliff. Actually, I often joke at Cliff. So one thing to know, Cliff and Lloyd and I all had a home base of Austin, Texas. And I met them about 15 years ago when I was in my own journey of, I had been a chief quality officer of an ambulance system and was interested in much of the work that API, Associates of Process Improvement, had been doing with folks in the healthcare sector. And I reached out to Cliff and Lloyd because they were in Austin and they were kind enough, as they have been over many years, to welcome me to have coffee and talk about what I was trying to learn and where my interests were and to learn from their work. And over the last 15 years, I've had a great benefit of learning from the experience and methods that API has been using with organizations around the world, built on the shoulders of the theories from Dr. Deming. And one of those that was in the Improvement Guide, one of the foundational texts that we use a lot in improvement project work that API wrote was, if you go into the back, there is a chapter, and Cliff, correct me if I'm wrong, I think it's chapter 13 in this current edition on creating value.   0:04:34.3 Dave Williams: In there, there was some description of kind of a structure or a system of activities that would be used to pursue qualities and organizational strategy. I later learned that this was built on a guide that was used that had been sort of semi self-published to be able to use with clients. And the more that I dove into it, the more that I really valued the way in which it had been framed, but also how, as you mentioned at the start, it provided methods in a place where I felt like there was a gap in what I saw in organizations that I was working with or that I had been involved in. And so back in 2020, when things were shut down initially during the beginning of the pandemic, I approached Lloyd and Cliff and I said, I'd love to help in any way that I can to try to bring this work forward and modernize it. And I say modernize it, not necessarily in terms of changing it, but updating the material from its last update into today's context and examples and make it available for folks through traditional bookstores and other venues.   0:05:58.9 Andrew Stotz: And I have that The Improvement Guide, which is also a very impressive book that helps us to think about how are we improving. And as you said, the, that chapter that you were talking about, 13, I believe it was, yeah, making the improvement of value a business strategy and talking about that. So, Cliff, could you just go back in time for those people that don't know you in the Deming world, I'm sure most people do, but for those people that don't know, maybe you could just talk about your first interactions with Dr. Deming and the teachings of that and what sparked your interest and also what made you think, okay, I wanna keep expanding on this.   0:06:40.0 Cliff Norman: Yeah. So I was raised in Southern California and of course, like many others, I'm rather horrified by what's going on out there right now with fires. That's an area I was raised in. And so I moved to Texas in '79, went to work for Halliburton. And they had an NBC White Paper called, "If Japan Can, Why Can't We?", and our CEO, Mr. Purvis Thrash, he saw that. And I was working in the quality area at that time. And he asked me to go to one of Deming's seminars that was held in Crystal City, actually February of 1982. And I got down there early and got a place up front. And they sent along with me an RD manager to keep an eye on me, 'cause I was newly from California into Texas. And so anyway, we're both sitting there. And so I forgot something. So I ran up stairs in the Sheraton Crystal City Hotel there. And I was coming down and lo and behold, next floor down, Dr. Deming gets on and two ladies are holding him up. And they get in the elevator there and he sees this George Washington University badge and he kind of comes over, even while the elevator was going down and picks it up and looks it up real close to his face. And then he just backs up and leans, holds onto the railing and he says, Mr. Norman, what I'm getting ready to tell you today will haunt you for the rest of your life.   0:08:11.8 Cliff Norman: And that came true. And of course, I was 29 at the time and was a certified quality engineer and knew all things about the science of quality. And I couldn't imagine what he would tell me that would haunt me for the rest of my life, but it did. And then the next thing he told me, he said, as young as you are, if you're not learning from somebody that you're working for, you ought to think about getting a new boss. And that's some of the best advice I've ever gotten. I mean, the hanging around smart people is a great thing to do. And I've been gifted with that with API. And so that's how I met him. And then, of course, when I joined API, I ended up going to several seminars to support Lloyd Provost and Tom Nolan and Ron Moen and Jerry as the various seminars were given. And Ron Moen, who unfortunately passed away about three years ago, he did 88 of those four day seminars, and he was just like a walking encyclopedia for me. So anytime I had questions on Deming, I could just, he's a phone call away, and I truly miss that right now.   0:09:20.5 Cliff Norman: So when Dave has questions or where this reference come from or whatever, and I got to go do a lot of work, where Ron, he could just recall that for me. So I miss that desperately, but we were busy at that time, by the time I joined API was in '88. And right away, I was introduced to what they had drafted out in terms of the five activities, which is the foundation of the book, along with understanding the science of improvement and the chain reaction that Dr. Deming introduced us to. So the science of improvement is what Dr. Deming called the System of Profound Knowledge. So I was already introduced to all that and was applying that within Halliburton. But QBS, as we called it then, Qualities of Business Strategy was brand new. I mean, it was hot off the press. And right away, I took it and started working with my clients with it. And we were literally walking on the bridge as we were building it. And the lady I'm married to right now, Jane Norman, she was working at Conagra, which is like a $15 billion poultry company that's part of Conagra overall, which is most of the food in your grocery store, about 75% of it. And she did one of the first system linkages that we ever did.   0:10:44.5 Cliff Norman: And since then, she's worked at like four other companies as a VP or COO, and has always applied these ideas. And so a lot of this in the book examples and so forth, comes from her actual application work. And when we'd worked together, she had often introduced me, this is my husband, Cliff, he and his partners, they write books, but some of us actually have to go to work. And then eventually she wrote a book with me with Dr. Maccabee, who is also very closely associated with Dr. Deming. So now she's a co-author. So I was hoping that would stop that, but again, we depend on her for a lot of the examples and contributions and the rest of it that show up in the book. So I hope that answers your question.   0:11:28.2 Andrew Stotz: Yeah, and for people like myself and some of our listeners who have heard Dr. Deming speak and really gotten into his teachings, it makes sense, this is going to haunt you because I always say that, what I read originally... I was 24 when I went to my first Deming seminar. And I went to two two-day seminars and it... My brain was open, I was ready, I didn't have anything really in it about, any fixed methods or anything. So, for me, it just blew my mind, some of the things that he was talking about, like thinking about things in a system I didn't think about that I thought that the way we got to do is narrow things down and get this really tight focus and many other things that I heard. And also as a young, young guy, I was in this room with, I don't know, 500 older gentlemen and ladies, and I sat in the front row and so I would see him kind of call them on the carpet and I would be looking back like, oh, wow, I never saw anybody talk to senior management like that and I was kind of surprised. But for those people that really haven't had any of that experience they're new to Deming, what is it that haunts you? What is... Can you describe what he meant when he was saying that?   0:12:42.9 Cliff Norman: I gotta just add to what you just said because it's such a profound experience. And when you're 29, if most of us, we think we're pretty good shape by that time, the brain's fully developed by age 25, judgment being the last function that develops. And so you're pretty well on your way and then to walk in and have somebody who's 81 years old, start introducing you to things you've never even thought about. The idea of the Chain Reaction that what I was taught as a certified quality engineer through ASQ is I need to do enough inspection, but I didn't need to do too much 'cause I didn't want to raise costs too much. And Dr. Deming brought me up on stage and he said, well, show me that card again. So I had a 105D card, it's up to G now or something. And he said, "well, how does this work?" And I said, "well, it tells me how many samples I got to get." And he says, "you know who invented that." And I said, "no, sir, I thought God did." He said, "no, I know the people that did it. They did it to put people like you out of business. Sit down, young man, you've got a lot to learn." And I thought, wow, and here you are in front of 500 people and this is a public flogging by any stretch.   0:13:56.1 Cliff Norman: And it just went on from there. And so a few years later, I'm up in Valley Forge and I'm working at a class with Lloyd and Tom Nolan and a guy named, I never met before named Jim Imboden. And he's just knock-down brilliant, but they're all working at General Motors at that time. And a lot of the book "Planned Experimentation" came out of their work at Ford and GM and Pontiac and the rest of it. And I mean, it's just an amazing contribution, but I go to dinner with Jim that night. And Jim looks at me across the table and he says, Cliff, how did you feel the day you found out you didn't know anything about business economics or anything else? I said, "you mean the first day of the Deming seminar?" He said, "that's what I'm talking about." And that just... That's how profound that experience is. Because all of a sudden you find out you can improve quality and lower costs at the same time. I'm sorry, most people weren't taught that. They certainly weren't taught that in business school. And so it was a whole transformation in thinking and just the idea of a system. Most of what's going on in the system is related to the system and the way it's constructed. And unfortunately, for most organizations, it's hidden.   0:15:04.2 Cliff Norman: They don't even see it. So when things happen, the first thing that happens is the blame flame. I had a VP I worked for and he'd pulled out his org chart when something went bad and he'd circle. He said, this is old Earl's bailiwick right here. So Cliff, go over and see Earl and I want you to straighten him out. Well, that's how most of it runs. And so the blame flame just takes off. And if you pull the systems map out there and if he had to circle where it showed up, he'd see there were a lot of friends around that that were contributing. And we start to understand the complexity of the issue. But without that view, and Deming insisted on, then you're back to the blame flame.   0:15:45.1 Andrew Stotz: Yeah. And Dave, I see a lot of books on the back on your shelf there about quality and productivity and team and many different things. But maybe you could give us a little background on kind of how how you, besides how you got onto this project and all that. But just where did you come from originally and how did you stumble into the Deming world?   0:16:08.9 Dave Williams: Sure. Well, sadly, I didn't have the pleasure of getting to sit in on a four-day workshop. Deming died in 1993. And at that time, I was working on an ambulance as a street paramedic and going to college to study ambulance system design and how to manage ambulance systems, which was a part of public safety that had sort of grown, especially in the United States in the '60s. And by the time I was joining, it was about 30 years into becoming more of a formalized profession. And I found my way to Austin, Texas, trying to find one of the more professionalized systems to work in and was, worked here as a paramedic for a few years. And then decided I wanted to learn more and started a graduate program. And one of the courses that was taught in the graduate program, this is a graduate program on ambulance management, was on quality. And it was taught by a gentleman who had written a, a guide for ambulance leaders in the United States that was based on the principles and methods of quality that was happening at this time. And it pieced together a number of different common tools and methods like Pareto charts and cause-and-effect diagrams and things like that.   0:17:33.1 Dave Williams: And it mentioned the different leaders like Deming and Juran and Crosby and others. And so that was my first exposure to many of these ideas. And because I was studying a particular type of healthcare delivery system and I was a person who was practicing within it and I was learning about these ideas that the way that you improve a system or make improvement is by changing the system. I was really intrigued and it just worked out at the time. One of the first roles, leadership roles that emerged in my organization was to be the Chief Quality Officer for the organization. And at the time, there were 20 applicants within my organization, but I was the only one that knew anything about any of the foundations of quality improvements. Everybody else applied and showed their understanding of quality from a lived experience perspective or what their own personal definitions of quality were, which was mostly around inspection and quality assurance. I had, and this won't surprise Cliff, but I had a nerdy response that was loaded with references and came from all these different things that I had been exposed to. And they took a chance on me because I was the only one that seemed to have some sense of the background. And I started working and doing...   0:19:10.1 Dave Williams: Improvement within this ambulance system as the kind of the dedicated leader who was supposed to make these changes. And I think one of the things that I learned really quickly is that frequently how improvement efforts were brought to my attention was because there was a problem that I, had been identified, a failure or an error usually attributed to an individual as Cliff pointed out, somebody did something and they were the unfortunate person who happened to kind of raise this issue to others. And if I investigated it all, I often found that there were 20 other people that made the same error, but he was, he or she was the only one that got caught. And so therefore they were called to my office to confess. And when I started to study and look at these different issues, every time I looked at something even though I might be able to attribute the, first instance to a person, I found 20 or more instances where the system would've allowed or did allow somebody else to make a similar error.   0:20:12.6 Dave Williams: We just didn't find it. And it got... And it became somewhat fascinating to me because my colleagues were very much from a, if you work hard and just do your job and just follow the policy then good quality will occur. And nobody seemed to spend any time trying to figure out how to create systems that produce good results or figure out how to look at a system and change it and get better results. And so most of my experience was coming from these, when something bubbled up, I would then get it, and then I'd use some systems thinking and some methods and all of a sudden unpack that there was a lot of variation going on and a lot of errors that could happen, and that the system was built to get results worse than we even knew.   0:21:00.7 Dave Williams: And it was through that journey that I ended up actually becoming involved with the Institute for Healthcare Improvement and learning about what was being done in the healthcare sector, which API at the time were the key advisors to Dr. Don Berwick and the leadership at IHI. And so much of the methodology was there. And actually, that's how I found my way to Cliff. I happened to be at a conference for the Institute for Healthcare Improvement, and there was an advertisement for a program called the Improvement Advisor Professional Development Program, which was an improvement like practitioner project level program that had been developed by API that had been adapted to IHI, and I noticed that Cliff and Lloyd were the faculty, and that they were in my hometown. And that's how I reached out to them and said, hey can we have coffee? And Cliff said, yes. And so...   0:21:53.1 Andrew Stotz: And what was that, what year was that roughly?   0:22:00.3 Dave Williams: That would've been back in 2002 or 2003, somewhere in that vicinity.   0:22:02.0 Andrew Stotz: Hmm. Okay.   0:22:06.8 Dave Williams: Maybe a little bit later.   0:22:06.9 Andrew Stotz: I just for those people that are new to the topic and listening in I always give an example. When I worked at Pepsi... I graduated in 1989 from university with a degree in finance. And I went to work at Pepsi in manufacturing and warehouse in Los Angeles at the Torrance Factory originally, and then in Buena Park. But I remember that my boss told me, he saw that I could work computers at that time, and so I was making charts and graphs just for fun to look at stuff. And he said, yeah, you should go to a one of these Deming seminars. And so he sent me to the one in... At George Washington University back in 1990, I think it was. And but what was happening is we had about a hundred trucks we wanted to get out through a particular gate that we had every single morning. And the longer it took to get those trucks out the longer they're gonna be on LA traffic and on LA roads, so if we can get 'em out at 5:00 AM, fantastic. If we get 'em out at 7:00, we're in trouble. And so they asked me to look at this and I did a lot of studying of it and I was coming for like 4:00 in the morning I'd go up to the roof of the building and I'd look down and watch what was happening. And then finally I'd interview everybody. And then finally the truck drivers just said, look, the loaders mess it up so I gotta open my truck every morning and count everything on it. And I thought, oh, okay.   0:23:23.7 Andrew Stotz: So I'll go to the loaders. And I go, why are you guys messing this up? And then the loaders was like, I didn't mess it up. We didn't have the production run because the production people changed the schedule, and so we didn't have what the guy needed. And so, and oh, yeah, there was a mistake because the production people put the product in the wrong spot, and therefore, I got confused and I put the wrong stuff on by accident. And then I went to the production people and they said, well, no, it's not us. It's the salespeople. They keep putting all this pressure on us to put this through right now, and it's messing up our whole system. And that was the first time in my life where I realized, okay, it's a system. There's interconnected parts here that are interacting, and I had to go back into the system to fix, but the end result was I was able to get a hundred trucks through this gate in about 45 minutes instead of two hours, what we had done before.   0:24:18.8 Andrew Stotz: But it required a huge amount of work of going back and looking at the whole system. So the idea of looking at the science of improvement, as you mentioned, and the System of Profound Knowledge, it's... There's a whole process. Now, I wanna ask the question for the person who gets this book and they dig into it, it's not a small book. I've written some books, but all of 'em are small because I'm just, maybe I just can't get to this point. But this book is a big book, and it's got about 300... More than 300 pages. What's the promise? What are they gonna get from digging into this book? What are they gonna take away? What are they gonna be able to bring to their life and their business that they couldn't have done without really going deeper into this material?   0:24:57.7 Cliff Norman: Dave, go ahead.   0:25:01.4 Dave Williams: Well, I was gonna joke by saying they're gonna get hard work and only half because this is just the theory in the book and many of the... And sort of examples of the method. But we're in the process of preparing a field guide which is a much deeper companion guide loaded with exercises and examples of and more of the methods. So the original guide that that API had developed was actually about an eight... Well, I don't know how many pages it was, but it was a thick three inch binder. This, what you have there is us refining the content part that explains the theory and kind of gets you going. And then we moved all of the exercises and things to the field guide for people that really wanna get serious about it.   0:26:00.3 Dave Williams: And the reason I say hard work is that the one thing that you won't get, and you should probably pass it if this book if you're on Amazon, is you're not gonna get an easy answer. This is, as a matter of fact, one of the things that emerged in our early conversations about was this project worth it? Is to say that this is hard work. It's work that a very few number of leaders who or leadership teams that really want to learn and work hard and get results are gonna embark on. But for those, and many of our clients, I think are representative of that, of those people that say, gosh, I've been working really hard, and I feel like we could do better. I feel like I could make a bigger impact, or I could serve more customers or clients.   0:26:44.0 Dave Williams: And but I am... And I'm in intrigued or inspired or gotten to a certain point with improvement science on my own, but I want to figure out how to be more systematic and more global and holistic at that approach. Then that's what QOS is about. It builds on the shoulders of the other books that you mentioned, like The Improvement Guide which we talked about as being a great book about improvement, and improvement specifically in the context of a project. And other books like The Healthcare Data Guide and the Planned Experimentation, which are also about methods, healthcare Data Guide being about Shewhart charts, and Planned Experimentation being about factorial design. This book is about taking what Cliff described earlier as that... I always say it's that that diagram that people put on a slide and never talk about from Deming of production views as a system and saying, well, how would we do this if this is the model for adopting quality as strategy, what are the methods that help us to do this?   0:28:01.3 Dave Williams: And this book breaks that down into five activities that are built on the shoulders of profound knowledge, built on the shoulders of the science of improvement and provide a structure to be able to initially develop a system, a systems view of your organization, and then build on that by using that system to continually operate and improve that organization over time. So the book describes the activities. The book describes some of the things that go into getting started, including being becoming good at doing results-driven improvement, building a learning system, focusing in on the things that matter to your organization. And then working towards building the structure that you can improve upon. The book creates that foundation. It provides examples from clients and from people that we've worked with so that you can see what the theory looks like in practice get, kind of get a flavor for that. And we hope it builds on the shoulders of other work that I mentioned in the other books that compliment it and provides a starting point for teams that are interested in taking that journey.   0:29:26.5 Andrew Stotz: And Cliff, from your perspective, if somebody had no, I mean, I think, I think the Deming community's gonna really dive in and they're gonna know a lot of this stuff, but is gonna help them take it to the next level. But for someone who never had any real experience with Deming or anything like that, and they stumble upon this interview, this discussion, they hear about this book, can they get started right away with what's in this book? Or do they have to go back to foundations?   0:29:49.6 Cliff Norman: No, I think that can definitely get started. There's a lot of learning as you know, Andrew, from going through the four-day to understand things. And I think we've done a pretty good job of integrating what Dr. Deming taught us, as well as going with the methods. And one of the things people would tell him in his four-day seminars is, Dr. Deming, you've given us the theory, but we have no method here. And he said, well, if I have to give you the method, then you'll have to send me your check too. So he expected us to be smart enough to develop the methods. And the API folks did a really good job of translating that into what we call the five activities. So those five activities are to understand the purpose of the organization.   0:30:35.6 Cliff Norman: And a lot of people when they write a purpose, they'll put something up there but it's usually we love all our people. We love our customers even more. If only they didn't spend so much, and we'll come out with something like that and there'll be some pablum that they'll throw up on the wall. Well, this actually has some structure to it to get to Deming's ideas. And the first thing is let's try to understand what business we're in and what need we're serving in society that drives customers to us. So that word is used not need coming from customers, but what is it that drives them to us so we can understand that? And then the second part of that purpose needs to define the mainstay, the core processes, the delivery systems that relate directly to customers. And just those two ideas alone, just in the first activity of purpose, most people haven't thought about those ideas.   0:31:27.8 Cliff Norman: And can somebody pick up this book and do that? Yes. And that will answer a big challenge from Dr. Deming. Most people don't even know what business they're in, haven't even thought about it. And so that we... That question gets answered here, I think, very thoroughly. In this second activity, which is viewing the organization as a system contains two components that's viewing the organization as a system. And that's difficult to do, and a lot of people really don't see the need for it. Jane Norman reminded Dave and I on a call we did last week, that when you talk about a systems map with people, just ask 'em how do they know what's going on inside other organizations, other departments within their organization? How do they know that? And most of us are so siloed.   0:32:11.2 Cliff Norman: Somebody over here is doing the best job they can in department X, and meanwhile, department Y doesn't know anything about it. And then three months later the improvement shows up and all of a sudden there's problems now in department Y. Well, somebody who's focused on the organization as a system and sees how those processes are related when somebody comes to a management meeting said, well, we've just made a change here, and this is gonna show up over here in about three months, and you need to be prepared for that. Andrew, that conversation never takes place. So the idea of having the systems map and this book can help you get started on that. The second book that Dave was just talking about, there are more replete examples in there. I mean, we've got six case studies from clients in there than the practitioners and people who actually are gonna be doing this work.   0:33:01.7 Cliff Norman: That's gonna be absolutely... They're gonna need that field guide. And I think that's where Dave was coming from. The third activity is the information activity, how are we learning from outside the organization and how do we get feedback and research into the development of new products and services and the rest of it? And so we provided a system there. In fact, Dave took a lead on that chapter, and we've got several inputs there that have to be defined. And people just thinking through that and understanding that is huge. When Dr. Deming went to Japan in 1950, he was there to do the census to see how many Japanese were left after World War II. And then he got an invitation to come and talk to the top 50 industrialists. And he started asking questions and people from the Bank of Tokyo over there and all the rest of it.   0:33:52.4 Cliff Norman: And Dr. Deming says, well, do you have any problems? And they said, what do you mean? He says, well, do customers call up and complain? And he said, yes. And he says, well, do you have any data? And he said, no. He says, but if they complain, we give them a Geisha calendar. And then Dr. Deming says, well, how many Geisha calendars have you given out? So it's like, in 1991, I'm sitting here talking to a food company and I asked him, I said, well, you get customer complaints? Oh yeah. Do you have any data on it? No, but we give 'em a cookbook. I said, well, how many cookbooks are you giving out? So I was right back to where Deming was in 1950, so having the information activity, that third activity critical so that we're being proactive with it and not just reactive.   0:34:43.7 Cliff Norman: And so I think people can read through that and say, well, what are we doing right now? Well, I guess we're not doing this and move on. Then the fourth activity is absolutely critical. This is where you know that you've arrived, because now you're going to integrate not only the plan to operate, but a plan to improve. That becomes the business plan. For most people in business plan they do a strategy, and then they have a bunch of sub strategies, and they vote on what's important, and they do some other things, and then a year later they come back and revisit it. Well, what happens here is there's some strategic objectives that are laid out, and then immediately it comes down to, okay, what's gonna be designed and redesigned in this system? Which processes, products and services are gonna be designed? 'Cause we can all see it now, Andrew.   0:35:31.6 Andrew Stotz: Mm.   0:35:31.6 Cliff Norman: We can, it's right in front of us. So it's really easy to see at this point, and now we can start to prioritize and make that happen on purpose. As an example when Jane was a vice president at Conagra, they came up with five strategic objectives. Then they made a bunch of promises to corporate about what they were gonna do and when they were going to achieve it. When she laid out the systems map for them, they were horrified that over 30% of the processes that they needed to be having precooked meat didn't even exist. They were gonna have to be designed. And so Jane and I sat there and looking at 'em and said, well, if you'd had this map before you made the promises, would you have made those promises? No, no, we're in trouble right now. I gotta go back to the CEO of the holding company and tell 'em we're not gonna make it.   0:36:22.4 Cliff Norman: But there's a whole bunch of people that sit around in goal settings. We're gonna do this by when and have no idea about what they're talking about. So that's a little bit dangerous here. And then the fifth activity, it's probably the most important. And where I want people to start, I actually want 'em to start on the fifth activity, which is managing individual improvement activities, team activities. And what I mean by that is, nothing can hold you up from starting today on making an improvement and use the model for improvement. The three basic questions, you can write that on an envelope and apply it to a project and start right away. Because learning the habit of improvement, and when you identify, and this is typical in the planning process, again, a chapter that Dave took a lead on in the planning chapter.   0:37:03.8 Cliff Norman: When you lay that out, you're gonna come up with three to five strategic objectives, but that's gonna produce anywhere between 15 and 20 improvement efforts. And when people start three improvement efforts, and they see how difficult that is to traffic through an organization, particularly if you have a systems map, makes it a lot easier. If you don't have that, then there's all sorts of things that happen to you.   0:37:21.3 Andrew Stotz: Hmm.   0:37:22.8 Cliff Norman: But the, the idea of that all coming together is critical. And where you... Where that really shows up for the reader here is in chapter one. So Lloyd Provost took a lead on chapter one. If you read chapter one, you got a pretty good idea of what's gonna happen in the rest of the book. But more importantly, in that book, in chapter one, there's a survey at the end. And every time we give this out to people, they feel real bad.   0:37:48.1 Cliff Norman: And well, Cliff, any, on a scale of one to 10, we only came up with a four. Well, what I would tell 'em is, if you can come up with a four, you're pretty good. And those fundamentals have to be in place. In other words, the management needs to trust each other. There are certain things that have to be in place before you can even think about skating backwards here. And quality as an organizational strategy is all about skating backwards. The people who don't have the fundamentals can't even start to think about that.   0:38:15.0 Cliff Norman: So that survey and the gap between where they are at a four and where they're going to be at a 10, we've integrated throughout the whole book. So as you're reading through the whole book, you're seeing that gap, and then you have a good plan forward as to what do I need to do to get to be a six, an eight, and what do I need to do to finally arrive at a 10? Dave, why don't you add to what I just said there, and I gotta turn on a light here, I think.   0:38:39.2 Dave Williams: Well, I think one of the things that, and Cliff has probably been the one that has helped me appreciate this to the biggest degree is the role in which improvement plays in quality as an organizational strategy. So, I mean, I think in general, in our world, improvement is seen as kind of like a given, but in our case, what we've found is that many times people are not working on the things right in front of them or the problems in which they have, that they are on the hook... I like to say, are on the hook to get accomplished right now. And like Cliff mentioned, many of my clients when I engage with them, I say, well, what have you promised this year? And they'll give me a list and I'll say, well, okay, what are you working on to improve? And they'll be working on projects that are not related to that list of things that they've got to affect. And so usually that's a first pivot is to say, well, let's think about what are the things that you're working on or should be working on that are either designing or redesigning your system to achieve these strategic objectives.   0:39:48.8 Dave Williams: And the reason to put the attention on that fifth activity and get people working on improvement, there's a good chance that the improvement capability within the organization currently isn't to the level that you need it, where you can get results-driven projects happening at a clip that will enable you to chip away at 20 projects versus four in a year. And that it's not well integrated into the leadership, into the support structures that you have. In addition, if you're trying to use improvement on things that you're on the hook for, and Cliff noted, especially if you've got a system map while you're on that journey, you're gonna start to pick up on where the disconnects are. Similar to your example, Andrew, where you were describing your experience working backwards in the process, you're going to start to recognize, oh, I'm working on this, but it's linked to these other things. Or in order for me to do this, I need that. Or... And so that amplifies the project to be kind of just a vehicle to appreciate other things that are interconnected, that are important in improving our work together.   0:41:05.1 Dave Williams: And so I think that that's a critical piece. I mean, I sometimes describe it as the disappointment that people have when they open QOS because they want to have a new method or a new thing to work on. I said, well, there's a lot new in here. And at the same time, we want to build on the shoulders of the fundamentals. We want to build it because it's the fundamentals that are going to be able for you to activate the things that are necessary in order for you to skate backwards, like Cliff was describing earlier.   0:41:36.2 Cliff Norman: I got to add to what Dave was saying because this actually happened to me with a... I'm not going to mention the name of the company, but it's a high-tech companies worldwide. And we got up, a good friend of mine, Bruce Bowles, and we were introducing the idea of quality as an organizational strategy. And one of the guys in the front row, he says, Cliff, this just sounds like common sense, why aren't we all doing this? I said, that's a real good question. Let me put that in the parking lot here. So I put it up on a flip chart. And so we went through the idea of... We were working on Shewhart control charts. And so we showed him one of those. And at the end of all that, he raised his hand and I said, yeah, he says, Cliff, this is hard. I said, well, let me put that up here. This is hard. Then we went through the systems map and he says, look, this is hard. By the end of the two days, it was, this is hard, this is hard, this is hard, this is hard. This goes back to what Dave was saying earlier about once you open this page, there's some work that takes off, but more importantly, there's something new to learn here.   0:42:40.3 Cliff Norman: And that's frustrating to people, especially when they've got to quit doing what they've done in the past. It's what Deming says, you got to give up on the guilt and you got to move forward and transform your own thinking. So there's something here for the management to do. And if they're not willing to do that work, then this is probably not a good thing for them. Just go back to the blame flame and circling org charts and that kind of stuff and then wonder why we're losing money.   0:43:11.8 Andrew Stotz: Yeah, and I think that that's one of the things that we see in the Deming community is that, why are people doing it the way they are, dividing things up and doing KPIs and saying, you take care of that. And we're gonna optimize by focusing on each... We see how that all kind of falls apart.   0:43:27.9 Cliff Norman: It all falls through reductionism.   0:43:29.8 Andrew Stotz: [laughter] Yeah.   0:43:32.5 Cliff Norman: It doesn't understand the system, yeah.   0:43:32.5 Andrew Stotz: Yeah, so what I want to do now is I was just thinking about a book on my shelf called "Competitive Strategy" by Michael Porter. And there's a whole field of study in the area of strategy for businesses. Now you guys use, and you explain a little bit about the way you come up with... Why you come up with organization rather than let's say company as an example. But let's just talk about strategy for a moment. Generally we're taught in business school that there's two main strategies. One is a differentiation strategy. I like to teach my students like Starbucks. It's very differentiated from the old model. And you can have a low cost strategy, which is like McDonald's, where it's all about operational efficiency.   0:44:18.4 Andrew Stotz: And those are two different strategies that can get to the same goal, which is to build a strong and sustainable business that's making a good profit for the employees to get paid well and for shareholders. And so for somebody that understands some of the foundations of typical strategy, it's hard for them to think, wait, wait, wait, what? You're just talking about just better quality is the strategy? How should they frame this concept of quality as a strategy in relation to what we've been taught about low cost and differentiation and other types of strategy? How do we think about this book in relation to that?   0:45:03.2 Cliff Norman: When Deming wrote his book, his very first one of the four "Out of the Crisis", which was the whole idea about quality and competitive position. But he was kind of answering that. And at that time, what we had is we had three companies in the United States that were going at each other, Ford, GM, and Chrysler. And they'd call each other up, well, what are you doing this year? Oh, we're making cars that don't work. Sometimes they break down. That's why we have Mr. Goodwrench to repair them. That's an extra revenue source for us. As one of the executives that are challenged, a colleague of mine, he said, you don't realize how much money we're gonna lose here taking the repair business out because we make a lot of money out of repair. So making cars that don't work has been a good revenue stream for us. Well, all that works out great, until somebody shows up like Toyota that has a car that works and doesn't need to be repaired by Mr. Goodwrench all the time.   0:45:58.8 Cliff Norman: So the mind shift there, and what Dr. Deming was saying is that he was focused on the competition's already licked. And I don't think Porter's thought about that very much, not to be overly critical, because I'm an admirer of his, but the idea of focusing on the need and why is that customer coming to us so that we make a journey, and the Japanese call that being in the Gemba, being in the presence with the customers as they use the product or service and doing the research and the rest of it. And then coming back and then redesign that product or service so that it not only grabs the current customer, but we start thinking about customers that are not even our customers and innovate and actually come up with a design that actually brings new customers to us through products and services that we haven't thought about yet. So if I show you three products just to make a picture of it, we often show like an abacus, which was a hand calculating machine about BC. Then there's a slide rule that came out about the same year that Columbus discovered America. And that was good till about 1968.   0:47:06.0 Cliff Norman: And then the calculator, the handheld calculator came out. Well the need for all three of those products is to do handheld calculations. So we've had that need since BC. Now in 1967, K&E Calculator was making that slide rule, which I used in junior high school. If you'd have come up to me and said, Cliff, what do you need in the way of a better slide rule? I said, well can you get me a holster for it? 'Cause I don't like having to stick me in the face. I put it in my pocket and it sticks me in the face. And if you can give me a holster for that, that would be my view of that. I wasn't about to come up with the TI calculator. That wasn't gonna happen. Not from Cliff. It's gonna come from an engineer at TI. Now, K&E Calculator, if they'd been doing research in the marketplace and saying, is there something that can totally disrupt us going on here? Rather than just looking at figuring out a way to make the K&E slide rule better, they might've discovered that.   0:48:07.0 Cliff Norman: Most people don't do that. They just go back. They just lose their business. And it was interesting in '67, their annual report put out, what's the world gonna look like 100 years from now? So they had dome cities, they had cars flying, they had all sorts of things going on that were great innovations, but they didn't have the TI calculator in there, along with the HP calculator. And that wiped out their business. And so if people understand the need, and that's what Dr. Deming is getting at, he says, they really haven't thought about what business they're in. So why are the customers coming to us? He says, no customer ever asked for pneumatic tire. No customer ever asked for a microwave oven. That came from people with knowledge that were looking at how the customers are using the current products and services and say, now, is there technology innovation going on that we can actually do a better job of providing a better match in the future?   0:48:56.9 Andrew Stotz: And can you explain why you use the word need as opposed to want?   0:49:06.5 Cliff Norman: That's a good question. The idea is that there's a need that's constant in society. So that need of having to do handheld calculations or needing healthcare or to pay bills, that need is constant throughout civilization. And so if I want something that's interesting, that might be the match. That might be something to do with some features what I'm offering and so forth. I'd like to have this, I'd like to have that. But the need and the way we're using that is it doesn't come from customers. It's what drives customers to us. And it's always been there. It's always been there. Need for transportation, for example. Whether you're walking or driving a bicycle or a car or a plane.   0:49:53.6 Andrew Stotz: And Dave, how would you answer the same question when you think about a person running a business and they've had many strategy meetings in their business, they've set their corporate strategy of what we're doing, where we're going and that type of thing. And maybe they've picked, we're gonna be a low cost producer. Thailand's an interesting one because Thailand had a ability to be low cost producers in the past. And then China came along and became the ultimate low cost producer. And all of a sudden, Thai companies had a harder time getting the economies of scale and the like. And now the Chinese manufacturers are just really coming into Thailand, into the Thai market. And now it's like, for a Thai company to become a low cost leader is almost impossible given the scale that China and the skills that they have in that. And so therefore, they're looking at things like I've got to figure out how to get a better brand. I've got to figure out how to differentiate and that type of thing. How does this... How could this help a place like that and a management team that is struggling and stuck and is looking for answers?   0:51:07.0 Dave Williams: Well, I go back to what Cliff said about that many organizations don't pause to ask, why do they exist? What is the need of which they are trying to fulfill? Much of my background involved working in the service industry, initially with public safety and ambulance systems and fire systems, and then later in healthcare and in education. And in many of those environments, especially in places where in public systems where they've been built and they may have existed for a long time, when you ask them about what are they trying to accomplish as an organization or what is it that they... The need that they're trying to fulfill? Typically, they're gonna come back to you with requests or desires or wants or sort of characteristics or outcomes that people say they expect, but they don't pause to ask, like, well, what is the actual thing of which I'm trying to tackle? And Cliff mentioned like, and we actually, I should mention in the book, we have a list of different strategies, different types of strategies, all the different ones that you mentioned, like price and raw material or distribution style or platform or technology.   0:52:30.9 Dave Williams: There's different types of strategies, and the one that we are focusing in on is quality. But I think it's important for people to ask the question. Cliff mentioned transportation. There's a number of different great examples, actually, I think in transportation, where you could look at that as being an ongoing need as Cliff mentioned from the days when there was no technology and we were all on foot to our current day. Transportation has been a need that existed and many different things over time have been created from bicycles, probably one of the most efficient technologies to transport somebody, wheels and carts. And now, and you were referencing, we've made reference to the car industry. It's a fascinating experience going on of the car world and gas versus electric, high technology versus not, autonomous vehicles. There's, and all of them are trying to ask the question of, are there different ways in which I might be able to leverage technology to achieve this need of getting from point A to point B and be more useful and potentially disrupt in the marketplace? And so I think the critical thing initially is to go back and ask and learn and appreciate what is that need?   0:53:58.6 Dave Williams: And then think about your own products and services in relation to that. And I think we include four questions in the book to be able to kind of think about the need. And one of those questions is also, what are other ways in which you could fulfill that need? What are other ways that somebody could get transportation or do learning or to help sort of break you away from just thinking about your own product as well? And that's useful because it's super tied to the system question, right? Of, well, this is the need that we're trying to fulfill and these are the products and services that are matching that need. Then the system that we have is about, we need to build that and design that in order to produce, not only produce the products and services that match that need, but also continually improve that system to either improve those products and services or add or subtract products and services to keep matching the need and keep being competitive or keep being relevant. And maybe if it's not in a competitive environment where you're gonna go out of business, at least be relevant in terms of the city service or community service, government service that continues to be there to match the need of the constituents. So I think it's a really important piece.   0:55:17.0 Dave Williams: It's that North star of saying, providing a direction for everything else. And going back to your original comment or question about strategy, and many times people jump to a strategy or strategies or, and those might be more around particular objectives or outcomes that they're trying to get to. It may not actually be about the method or the approach like cost or technology that they may not even think that way. They may be more thinking about a plan. And I really encourage people to be clear about what they're trying to accomplish and then start to ask, well, how's the system built for that? And later we can bring a process that'll help us learn about our system and learn about closing that gap.   0:56:05.1 Cliff Norman: Yeah. Just what I'd add to that, Andrew, because you mentioned China, a few other countries, but I think the days are coming to an end fairly quickly where somebody can say, oh, we can go to this country. They have low wages, we'll put our plant there and all that. There's a lot of pushback on that, particularly in the United States. And if that's your strategy, that hadn't required a lot of thinking to say the least. But in 1966, over 50% of the countries in the world were, let me rephrase that, over 50% of the population of the world lived in extreme poverty. So there were a lot of targets to pick out where you want to put your manufacturing. And in 2017, and you and Dave were probably like myself, I didn't see this hit the news, but that figure had been reduced from over 50% down to 9%. And all you have to do is just, and I worked in China a lot, they're becoming very affluent. And as they become very affluent, that means wages are going up and all the things that we want to see throughout the world. And I think that's happening on a grand scale right now, but you're also getting a lot of pushback from people when they see the middle class in their own country, like here in the United States, destroyed, and say, I think we've had enough of this. And I think you're gonna see that after January. You're gonna see that take off on steroids.   0:57:31.7 Cliff Norman: And that's gonna happen, and I think throughout the world, people are demanding more, there's gonna have to be more energy, every time a baby is born, the footprints gets bigger for more energy and all the rest of it. So it's gonna be interesting, and I think we are going into an age for the planet where people as Dr. Deming promised that they'd be able to live materially better, and the whole essence of this book is to focus on the quality of the organization and the design and redesign of a system to a better job of matching the need and cause that chain reaction to go off. When Jane and I went over to work in Sweden, Sven Oloff who ran three hospitals and 62 dental clinics there and also managed the cultural activities and young shipping. He said, Cliff, I report to 81 politicians. I don't wanna have to go to them to put a bond on an election to get more money for my healthcare system, I wanna use Dr. Deming's chain reaction here to improve care to the patients in my county and also reduce our costs. A whole bunch of people that don't even believe that's possible in healthcare.   0:58:39.9 Cliff Norman: But that's what Sven Oloff said that's what you're here for. And that's what we proceeded to do, they launched about 350 projects to do just that, and one of their doctors, Dr. Motz [?], he's amazing. We taught him a systems map, I came back two months later, and he had them in his hospital on display. And I said, Motz, how did you do this? He said well Cliff, I'm an endocrinologist by education as a doctor, of course, that's a person who understands internal systems in the body. So he said the systems approach was a natural for me. But I'd like to say it was that easy for everybody else, that systems map idea and as you know, being in the Deming seminar, that's quite a challenge to move from viewing the organization as an org chart, which has been around since Moses father-in-law told him, you need to break up the work here a little bit, and the tens of tens reporting to each other, and then of course, the Romans took that to a grander scale, and so a centurion soldier had 100 other soldiers reporting to him. So we've had org charts long and our federal government took that to a whole new level.   0:59:46.1 Cliff Norman: But the idea is switching off the org chart from biblical times to actually getting it up to Burt [?] about 1935 and understanding a system that's kind of a nose bleed in terms of how much we're traveling there to get us into the 21st century here.   1:00:04.0 Andrew Stotz: And I left Ohio, I grew up outside of Cleveland, and I left Ohio in about 1985, roughly. And it was still a working class, Cleveland had a huge number of jobs and there was factories and all that, and then I went to California, and then I moved to Thailand in 1992. So when I go back to Ohio now, many years later, decades later, it's like a hollowed out place, and I think about what you're saying is... And what's going on in the world right now is that I think there's a desire in America to bring back manufacturing to bring back production and all of that, and that's a very, very hard challenge, particularly if it's gone for a while and the skill sets aren't there, maybe the education system isn't there, I talk a lot with John Dues here on the show about the what's happening in education and it's terrifying.   1:01:05.9 Andrew Stotz: So how could this be... Book be a guide for helping people that are saying, we've got to revitalize American production and manufacturing and some of these foundational businesses and not just services, which are great. How can this book be a guide?   1:01:25.8 Dave Williams: One thing I would say that I think is interesting about our times, many times when I reflect on some of the examples that you just provided, I think about how changes were made in systems without thinking about the whole system together. And there may have been changes at various times that we're pursuing particular strategies or particular approaches, so it may have been the low-cost strategy, it may have been to disrupt a marketplace. And oftentimes, they don't think about... When somebody's pursuing one particular view, they may miss other views that are important to have an holistic perspective. One of the things that I appreciate about QoS in the methods and overall as a holistic view of looking at organizations that it's asking us to really think initially about that North Star, what we're trying to do, our purpose, and what are the tenants. What are the things that are important us, the values...   1:02:38.7 Dave Williams: That are important to us in pursuing that particular purpose? And in doing that, really thinking about how does the system work as it is today, and if we make changes, how does it move in alignment with the values that we have and in the direction that we wanna go? And appreciating, I would say, part of the value of the scientific thinking that is in the Science of Improvement is that it encourages you to try to see what happens and appreciate not only what happens in relation to the direction you're trying to go, but also the... Have a balanced view of looking at the collateral effects of things that you do, and I think that systems do is really important there. So I think from that perspective, the quality as an organizational strategy brings a holistic picture into these organizations, or at least...   1:03:45.1 Dave Williams: To be paying attention to the system that you have, maybe the direction you wanna go, and what happens as you... What are your predictions and what do you see when you study the results of making changes in the direction of the vision that you have. And I think that's at a high level that is one of the ways that I think about it. Cliff, how would you add on there?   1:04:09.1 Cliff Norman: Your question made me think of something that happened about two years ago, Jane and I got a call from a lady that worked for her in one of the chicken plants, and she said, Jane, I had to call you because I need to order some of those Shewhart charts. But what happened today, you should have been here and Jane said, what... She said, Remember that 10 year thing we buried in the ground that we're gonna open up in 10 years, and she said, yeah, said, well, we opened it up today, and the new plant manager was here, and those Shewhart charts came out, and he looked at the costs on them. He said, you were operating at this level? She said, yeah, routinely. And he said what happened? He said, well, they had new management come in and they got rid of the charts, that's the first thing they did, and then gradually they try to manage things like they normally did, and then they forgot everything that we had learned. And that's kind of where we are right now.   1:05:11.0 Cliff Norman: So just think of that a decade goes by, and it just as Dr. Deming said, there's nothing worse than the mobility of management, it's like getting AIDS in the system. And they basically destroyed their ability to run a low-cost operation in an industry that runs on 1 or 2%. And when you watch that happen and understand that we still have food companies in this country, and we have to start there and start looking at the system anew and start thinking about how it can actually cause that chain reaction to take off, and that comes from focusing on quality of the system. And then as Dr. Deming says, anybody that's ever worked for a living knows why costs go down with two words less rework, but instead of people will put in extra departments to handle the rework. Next thing they start building departments to handle...   1:06:01.8 Cliff Norman: The stuff that's not working because the system they don't understand. So that was a... What do they call those things, Dave, where they put them in the ground and pull him out?   1:06:11.0 Dave Williams: Time capsule.   1:06:13.4 Andrew Stotz: Time capsule yeah.   1:06:13.5 Cliff Norman: Yeah. Time capsule. The a 10-year time capsule.   1:06:19.2 Andrew Stotz: It's a great, great story. And a great idea. We had a company in Thailand a very large company that the CEO of it came upon the idea of the teachings of Dr. Deming and over time, as he implemented it in his company, the Japanese Union of Scientists have their prize and his company won that prize and then he had about 10 subsidiary companies that also were doing it and they also won over time. And so Thailand is actually is the second largest recipient of the Japanese Deming Award outside of India. But he left and he retired and another guy took over, a very bright guy and all that, but he threw most of that out and focused on newer methods like KPIs and things like that. And just at the end of last year, maybe six months ago, they reported a pretty significant loss, and I was kind of made me think how we can spend all this time getting the Deming teachings into our business, and then one little change in management and it's done.   1:07:26.9 Andrew Stotz: And that made me think, oh, well, that's the value of the book, in the sense that it's about building the concept of quality as a core part of strategy as opposed to just a tool or a way of thinking that could go out of the company as soon as someone else comes in. Go ahead, Dave.   1:07:41.9 Dave Williams: I was gonna say, Andrew, you raise a point, I think it's really, really important and Cliff mentioned this in terms of the problem of mobility of management. One thing that I don't know that we outline probably in dark enough ink in the book is the critically important piece of leadership, building the structures and the capability. I know we talk a little bit about it, but doing it in a way that both builds up the people that you have... So Cliff emphasiz

On the latest episode of Pickaxe and Roll, Ryan Blackburn reacts to the Denver Nuggets 112-101 win over the Dallas Mavericks. Aaron Gordon returned to the floor and played 18 minutes off the bench. His presence helped the bench lift the Nuggets starters on a bad day. Nikola Jokic was okay, Jamal Murray struggled, and Michael Porter shot 1/8 from 3. Fortunately, Russell Westbrook picked them up, as did Peyton Watson and the Nuggets defense. Ryan discusses the win, AG's return, and his thoughts on the Mavericks. BETONLINE: The Game Starts Here! https://www.betonline.ag

Are you still relying on traditional strategic planning for your business? It might be time for a change! In this conversation, we dive into the revolutionary concepts from the bestselling book, The Emergent Strategy and the Death of Strategic Planning. Discover why the old methods are no longer effective and how adopting an emergent strategy can drive your company towards profitable growth.

The Denver Nuggets won ugly in New Orleans, and dominated the Suns in Denver without Jamal Murray, but then lost with all of their guys on Christmas in Phoenix.This week, Miroslav is joined by the elite trio of Rayvone Hackshaw, Jeremy Poley, and Andy Juett.The squad talks about the Nuggets being 5 and 1 without Jamal Murray this season, and 11 and 11 with him in the lineup. Why do the Nuggets play so much better without their second-best player?They also discuss Christian Braun's slump, Michael Porter's play despite trade rumors, and Jokić's low assist numbers.Expect some fun at the end of the show.Support the show: https://Patreon.com/miroslavcuk      An ALLCITY Network Production  PARTY WITH US: https://thednvr.com/events  ALL THINGS DNVR: https://linktr.ee/dnvrsportsEmpire Today: Schedule a free in-home estimate today! All listeners can receive a $350 OFF discount when they use the promo code DNVR. Restrictions apply. See https://empiretoday.com/dnvr for detailsSubscribe:   youtube.com/dnvr_sports   

On the latest episode of Pickaxe and Roll, Ryan Blackburn reacts to the Denver Nuggets loss to the Phoenix Suns on Christmas. Nikola Jokic started the game well, but he was the only one to truly play well. Jamal Murray returned, and the Nuggets starting lineup bogged down. Michael Porter looked uncomfortable. Christian Braun looked unsure of himself. Aaron Gordon got hurt. Ryan discusses Denver's Christmas flub and more. BETONLINE: The Game Starts Here! https://www.betonline.ag

On the latest episode of Pickaxe and Roll, Ryan Blackburn discusses the Denver Nuggets 141-111 win over the Atlanta Hawks, breaking down Denver's recovery performance after an ugly loss to the Washington Wizards the night before. He goes over Nikola Jokic's night, Michael Porter, Russell Westbrook, and surprisingly...Jalen Pickett! Can the Nuggets participate in their own recovery? BETONLINE: The Game Starts Here! https://www.betonline.ag

Underdog Entry: Paul George Higher than 16.5 points Jarrett Allen Higher than 14.5 points Underdog Promo Code: PLAYME Signup Link: https://play.underdogfantasy.com/p-play-me-or-fade-me Support the Show/Community Best Bet Newsletter: https://www.buymeacoffee.com/playmeorfademe/membership Learn more about your ad choices. Visit megaphone.fm/adchoices

This week marks a huge milestone for the HBR IdeaCast: our 1000th episode! Since the podcast launched in 2006, so much has happened. What hasn't changed is our commitment to sharing in-depth conversations with expert thinkers on key business, management, and leadership issues. To celebrate, hosts Alison Beard and Curt Nickisch have scoured the archive for ten episodes with top-notch insights to give your career a rocket boost. The curated selection features a diverse group of academics—from business strategy icon Michael Porter to burnout researcher Christina Maslach—and practitioners, such as Microsoft CEO Satya Nadella and Oscar-winning director Ron Howard. Their powerful ideas and timeless advice cover a range of communication, leadership, and problem-solving skills that are essential for success—whether you're in your first job, managing a team, or leading an organization. Listen to the episodes: #677: Why People — and Companies — Need Purpose (2019) #114: Speaking Well in Tough Moments (2008) #371: Lead Authentically, Without Oversharing (2013) #924: How One F-35 Fighter Pilot Makes Decisions Under Pressure (2023) #949: Making Peace with Your Midlife, Mid-career Self (2024) #889: Ron Howard on Collaborative Leadership and Career Longevity (2022) #596: Microsoft's CEO on Rediscovering the Company's Soul (2017) #595: Transcending Either-Or Decision Making (2017) #771: Why Burnout Happens — and How Bosses Can Help (2020) #229: How to Fix Capitalism (2011) The IdeaCast team would like to thank all the guests who've contributed their voices and expertise as well as all the people who've made the show possible behind the scenes.

“The Kilcoyne Conversation” with Lorenzo Romar, the former @SaintLouisMBB coach as he returns to town this week to be their opponent. He talks about his time with SLU, Bills miracle NCAA trip, connection to Michael Porter, demise of PAC-12, up close view of the Tyus Edney moment and more.

“The Kilcoyne Conversation” with Lorenzo Romar, the former @SaintLouisMBB coach as he returns to town this week to be their opponent. He talks about his time with SLU, Bills miracle NCAA trip, connection to Michael Porter, demise of PAC-12, up close view of the Tyus Edney moment and more.

Underdog Entry: Aaron Judge Higher than 1.5 HRR Brandin Podziemski Higher than 15 points + rebounds Underdog Promo Code: PLAYME Signup Link: https://play.underdogfantasy.com/p-play-me-or-fade-me Support the Show/Community Best Bet Newsletter: https://www.buymeacoffee.com/playmeorfademe/membership Discord: https://discord.gg/KmfbssQP Learn more about your ad choices. Visit megaphone.fm/adchoices

Traditional management uses "carrots," like bonuses, and "sticks", like Performance Improvement Plans, to motivate employees. But are humans really built that way? In this episode, Jacob Stoller and Andrew Stotz dive into the myth surrounding that approach and talk about what actually motivates people at work. TRANSCRIPT 0:00:02.7 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we dive deeper into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with Jacob Stoller, Shingo-Prize winning author of The Lean CEO and Productivity Reimagined, which explores applying Lean and Deming management principles at the enterprise level. The topic for today is myth number four, the myth of sticks and carrots. Jacob, take it away.   0:00:46.2 JS: Thank you, Andrew, and great to continue our conversation. Yeah, it is widely believed that people are motivated by threats and rewards. And to demonstrate that, all you have to do is go into an HR department and look at the job descriptions and the reward programs. And it's all assumes that people are motivated by externalities, right? And that goes back, actually, it's a very, very old way of looking at the world, that there's a term, it's a bit of Latin here, homo economicus. And it's the idea that humans are sort of goal seeking creatures. They seek what's better for them, and it's all material. They'll seek their material gain, and they will behave in very predictable ways, according to that. So you can set up external motivators, mainly money, and you can regulate the way people will behave.   0:01:38.2 JS: So that's the assumption that many businesses are built on. But science has proven that that's not the way human humans work. There've been a number... And starting really in the 1950s, a number of scientists have sort of poked serious holes in that thinking. One of them is Edward Deci, who talked about motivation and did a number of experiments to see that, to find out that people, you know, their motive for doing tasks really kind of transcends rewards. Often they'll do something, for the satisfaction of doing it, in spite of the rewards being greater. We have Frederick Herzberg who developed something called Hygiene Theory. And that's really that... He determined in an organization that money can't actually be a positive motivator. It can't motivate positive behavior, but lack of money can motivate negative behavior.   0:02:49.6 JS: So, you know, and a number of experiments to support that. And then we have, Mihaly Csikszentmihalyi, hard to pronounce, who talks about joy at work and really did experiments and kind of proved that joy at work isn't just some kind of fancy idea that somebody had. But it's actually a scientifically proven principle. Whereas when people have joy at work and they're fully engaged in their work, they do much higher quality work. So that's kind of the background really here. So what we want, when we manage, is we want people to be intrinsically motivated so that they do their best work. And Deming principles are very, very, I think representative of that. I think Dr. Deming understood that people are motivated when they feel a part of something, when they contribute, when they feel that their team members around them are supporting them. And so that's what we try to do. And Lean eorld tries to do that, and we try to do that with Deming principles.   0:04:06.8 AS: You know, when I start off my discussion on this with students and people that I teach in seminars and the like, I always ask them, you know, which, do you believe in, a carrot or a stick? Do you think more people are motivated by rewards or punishments? And it's a great...   0:04:18.1 Jacob Stoller: Oh, okay.   0:04:24.1 AS: Way to kick off a conversation. But, you know, obviously we're gonna get some people that say, I want people to be feeling, you know, positive rewards and feel positive. And then you have the other people that... What I invariably find is that people who are running large companies with lots of employees, it's sticks. Yes, because...   0:04:40.4 JS: Interesting.   0:04:41.8 AS: It's overwhelming. And then when I think about where it's easiest to do joy in work, and where it's easiest to get the intrinsic motivation is, you know, smaller companies where everybody's close and they're really working together. And that's a dilemma that I never really have had a great reconciling of, but I'm interested to learn more about it from the direction that you're coming. So continue on. But that's just something I have in my mind when heard you talk about it.   0:05:13.1 JS: It's tough to do with a big company, but I wanna tell you a big company story. And actually I'm gonna read, a page or two of the book just because it's, I don't want to, it's a complicated story and I wanna make sure you get all the...   0:05:32.5 AS: Well, you've it written so well. So might as well do that.   0:05:36.1 JS: Well, like, gosh, let's hope so. Let's hope so. But, anyway, this is actually by coincidence. I just, what appeared, this morning on their podcast, so, of this company called Barry-Wehmiller. So, but the CEO of Barry-Wehmiller is a gentleman named Bob Chapman. And he's become quite well known in the Lean world and outside of the Lean world because as a pioneer of what we could call human-centric leadership. So he believes in treating people in the company like family members. But he didn't start out that way. He started with a very traditional background. He took over his father's business and he had a typical MBA background with accounting. And so he grew that company in a traditional way. You know, it started, as one company, and it started really by acquisition.   0:06:25.5 JS: He got very, very good at finding undervalued companies and developing them. So the company grew and it became a sort of a multinational, diversified manufacturer of various kinds of machinery. And so he was a huge success. I mean, he was written up in Harvard Business Review, all this kind of stuff, but he had a feeling, he was very much a family man too, and he had a feeling that something wasn't quite right in the companies that he was running. And he's a... Bob is a very... He watches people, he's very sensitive about body language. And he told me of a time he was in the cafeteria of a company, and it was sort of basketball season, you know, March Madness. That's when the university teams, you know, have their finals and all that, and everybody's betting on them, you know, it's a big deal.   0:07:21.9 JS: So he remembers being in there, and the people in the cafeteria all just having a great time and watching them chatter. And then, he watched the... When the clock sort of moved, so it's a few minutes to having to go back to work, he said the body language changed, all of a sudden they just weren't that happy. You know, it just, all the joy kind of drained out of them. And then they went off to their jobs. And Bob said, you know, this is wrong. You know, that it shouldn't be this way. And he was a family man. He said, I wouldn't want my children who I care about to be working in this kind of environment. So how can we care for the people and how can we actually make that work? So here's what I'm gonna start to read, because here's where it gets complicated.   0:08:08.6 JS: "Chapman vowed to change how people were led at Barry-Wehmiller. His business background, however, didn't provide any help for this. 'When I was in business school, I was never taught to care,' he said. 'It was about creating economic value. It was all business models, market cap, market share. I don't remember in my undergraduate in accounting or my graduate school ever learning to care or inspire the people I had the privilege to lead. And I never read, never was told, never heard that the way I would run Barry-Wehmiller would impact the way people go home and treat their families and their health. But the biggest thing we've learned is that the way we learn impacts the way people live.' Working with a group of team members from across the organization, he developed a set of principles called the Guiding Principles of Leadership, or GPL, which put caring for people as front and center to the job for all leaders in the company.   0:09:05.2 JS: "But the question remained, how do we organize the work in a way that gives workers the experience of working in a caring environment? It happened that Barry-Wehmiller had recently acquired a Baltimore based manufacturer of corrugated paper machines called MarquipWardUnited the company had implemented a number of Lean tools and practices under the leadership of Jerry Solomon, who was also the author of several books on Lean accounting. In Chapman's first meeting with Solomon, he introduced him to the Guiding Principles of Leadership and Solomon immediately saw a connection with the challenges companies face when trying to create a Lean culture. Most companies practicing Lean, he noted, never get to the culture piece. The same concern that caused the Shingo Institute to revise its model in 2008." And by the way, I have to interject here. That was covered in a previous chapter, how Shingo Institute found that they had left out the people and the caring part.   0:10:14.4 JS: And that had caused a lot of companies that had adopted Shingo principles to actually, and had won Shingo prizes to actually fall off the ladder, so to speak. But that's another story. Anyway, "Solomon," Jerry Solomon, this is the, from MarquipWardUnited "felt that what the company needed was what he called a delivery mechanism to integrate the Guiding Principles of Leadership with the company's day-to-Day operations. How, for example, does a supervisor in the shop floor interact with the people doing the work? Solomon felt that Lean and GPL were an ideal fit. Chapman was skeptical, though, 'cause he'd heard that Lean is purely about reducing waste and increasing profits, but not about leading people ... passed.   0:11:06.2 JS: And the group that was working on it, this company in Green Bay, actually was ready to report on some of their results. So they invited Bob Chapman and Jerry to come, to fly in to see the report. So what they got was a sort of a typical consultant's report. They said, well, we've implemented this thing and we've got, we've shortened the lead time, we've reduced the defects, whatever. And Chapman's reaction was actually different than what you would expect. He was very, very upset. 'Cause he said, this is supposed to be about people and Guiding Principles of Leadership. That's what you told me Lean was about. But here all I hear is a bunch of numbers. So he was quite upset. He left the room, actually. And they sort of calmed him down, and they said, Bob, please give us another chance.   0:12:03.6 JS: And it so happened that, the next morning there was going to be a report out from people that were actually on the team that had made the improvements. So Bob says, okay, I'll give you another chance, but I want the people that were actually working on that project to come and report to the presidents. So, an incredible setup. You know, you can imagine, you have these people 7 o'clock in the morning. Well, that's not hard for you to imagine, with the hours you keep. But anyway, 7 in the morning, you have all the principals, presidents of these companies, and you have, a couple of, people in the team and a guy who's never presented to a group like that, getting up in front of a whole group of CEOs. So he had some notes, and he went through his presentation, which was very sort of, you know, what you would expect.   0:12:54.2 JS: It was, yeah, we've got the, pretty much what the consultants had said the day before, right? Yeah. We cut the lead time. We did this. And, Bob listened patiently. He said he listened for about 10 minutes, and then he says, and he says, I don't know where this came from. He stood up and said, Steve, that's the name of the guy presenting. How did this change your life? And there was a silence. And you imagine, right? All the CEOs and or the presidents. And then, and this guy who has never presented to a group like that. And Steve just sort of blurted out, my wife is talking to me more. And Bob said, help me, Steve. I don't understand. Please, please explain this. And Steve then went ahead and told, what Bob said was one of the most moving stories he'd ever heard, you know, and what Steve said is, well, Bob, you know how it is.   0:13:53.9 JS: You go to work and, you know, you punch in your clock. And then they give you some things to do. They give you a list of things to do, but they don't give you any support or anything, or they don't give you the tools you need, but you sort of figure it out. You know, you get through the day and you get nine out of 10 things, right? But then maybe that 10th thing you'll run into some problem. He said, and immediately what they do, they never thank you for the things you did right. They jump on you for the problem you have, that you confronted. They tell you, you didn't do things right. And then they complain about your salary and how they have to pay overtime and all these kinds of things.   0:14:41.6 JS: And he said, you know, at the end of the day, I wasn't feeling too good about myself. And I'd go home and I think it was rubbing off on me. I wasn't being very nice to my wife and she wasn't talking to me. But he said, now with this program we have, the Guiding Principles of Leadership with Lean, people, I'm part of something. I'm part of a team. We've worked on some things and I can see the results. And when I ask questions, these engineers are answering my questions. And when I say things, they listen to me. And, you know, we've got the satisfaction of this project where we see the flow now really working out in this area. So I go home and I'm feeling better about myself. And I think I'm nicer to my wife and she's talking to me. And at that point, Bob Chapman turned to Jerry Solomon and he said, we have a new metric for Lean's success. It's going to be the reduction of the divorce rate in America.   0:15:41.7 JS: So that's, I think, very, very central. That story to everything we're talking about here with intrinsic motivation. Because it's not about money. It's, you know, you've gotta pay people decently and then they have to be able to support their families. But it's about respect. It's about seeing yourself accomplish things. And this isn't just a frill, this is a basic human need. I think Dr. Deming recognized that. And he has a wonderful diagram in The New Economics where he talks about, he calls it Forces of Destruction. You know that diagram?   0:16:23.1 AS: Yeah.   0:16:27.5 JS: Yeah. It's the... How the school system and then the job environments just basically wear a person down, wear down their will and their enthusiasm. And, you know what, another CEO pointed out to me that, very interestingly, he said, we have a crisis in this country because people don't have purpose in their work. So they go from job to job when they don't like their job. It's, he said, it's like changing an app. Something goes wrong, they change it, but they got no purpose in their work.   0:17:03.3 JS: And this company, I should I call them out, 'cause he, mention his name is Mark Borsari. And it's a company that makes wire brushes in Massachusetts. But they do, you know... He said, you really have to find the purpose in the interactions of people. It's in the people and it's in the processes. You don't get people excited about wire brushes. You get people excited about being part of a work environment where your opinion is respected and where you can make improvements. So, he said, that's what people need in the workplace right now. And he said, the result is that people, you know, we have people just depressed and upset and, you know, it's a crisis that's perhaps underestimated, but really needs to be addressed. So that's why I feel maybe so passionate about this sticks and carrots myth, because I see how destructive it is to human beings. And I've experienced some of that myself in, you know, my early days in corporate life where you're kind of blamed and evaluated for things that often you have no control over. And it's, you know, you look at something like the Red Bead Game. There are people that actually live that.   0:18:31.0 AS: Just to highlight for the listeners and the viewers, the book that Bob Chapman wrote is called Everybody Matters: The Extraordinary Power of Caring for Your People Like Family, very highly rated on Amazon. And it looks like it's also in audible form, which would be a fun one. And you also mentioned about Jerry Solomon, his book, Who's Counting is another one on the topic.   0:18:32.5 AS: But you know, I was thinking about this for a moment. And I was thinking, you know, I was kind of inoculated to this, I was vaccinated against negative thinking by two things that happened to me when I was young. The first one is, you know, I went into rehab as as a young guy with drug addiction. And I came out of that when I was almost 18. And from that point till today, I've been drug free, alcohol free. And so I had to kind of face all the demons that I had, you know, accumulated at that time, but I left it with a really positive outlook on life.   0:19:29.7 AS: Like I wanted happiness.   0:19:29.8 JS: Interesting.   0:19:29.9 AS: I wanted serenity. And then and then I went to work... I went studied, enjoyed that, I went to work for Pepsi, I really enjoyed it. And then I met Dr. Deming when I was, you know, 24. And and he told me, you know, we should have joy in work. And from that moment on, it's like, that's what I wanted in life. And so I never, I never got caught up in this idea when I worked at Big Bank, you know, Citibank and other places, I just never, nobody could ever convince me that, you know, I should be unhappy with what I'm doing.   0:20:05.5 AS: Like, I really, really enjoyed it. And then I was just thinking about how painful it is, if you haven't been inoculated from the beginning, to have to go through this, and then you end up with, you know, it's it's 9 to 5, it's painful work, it's called work for a reason, it's hard, you know. And I think that before I come to the next questions, you know, about the question we always get on the topic of carrots and sticks, what do we do instead?   0:20:30.6 AS: Before I talk about that, I think I really wanna highlight that what's important is getting your thinking right about this. Whether it's the thinking about I wanna treat people like a family, I want people to enjoy work, I want work to be a source of pride, I want people to wanna work here. You know, if you can get those thoughts right, the solutions to the carrots and sticks, and how do we evaluate and all of those questions, you know, can kind of, they wither away to some extent. What are your thoughts on that?   0:21:02.4 JS: Well, I think Jerry Solomon said it very well, actually. He said, you need a delivery mechanism. And Lean provided that, you know, it has a bunch of tools and organizing principles. So does the Deming's System of Profound Knowledge, right, and the various frameworks that Dr. Deming put together. So that provides that kind of framework. It's not easy to do. I think one of the big hurdles, and this is kind of central to my book is that you're dealing with a lot of unlearning. And they say that it's harder to unlearn something than it is to learn new skills. So we really can't afford to underestimate that.   0:21:51.1 JS: And I think when we have managers and leaders facing massive unlearning challenges, I think what's needed is compassion, you know, we shouldn't be putting them down for applying what they learned, we should be understanding about the changes. And I think Dr. Deming, you know, from the stories I've heard was very good about that.   0:22:00.0 AS: Well, he had something he would say, which was kind of one of his methods of compassions, but I remember him saying, how could they know? How could they know, you know, like, they were brought up in this system, as you've just said, and so, but it's based upon the carrot and sticks and all of these different things. But I'm curious, you know, which I think we at some point we'll get to in our discussion is the, there's listeners and viewers out there. It's like, okay, Jacob, totally agree with you. Andrew, totally agree with you. I want people to have joy in work. But you know, I'm constrained by, you know, the performance appraisals that I got to do.   0:23:07.3 AS: I'm constrained by the punishments and rewards that my company does. And or a leader of a company says, if I let these things go, we're gonna fall apart. How do you respond to that?   0:23:11.6 JS: Well, gosh, I mean, I think you have to just look at the case studies of people that have let that go. And that's why I emphasize I one of the points I emphasize in the book with advice for companies moving forward is a very first step before you do anything is go visit companies that have been successful. You know, go visit Bama Foods, where they have a great culture. Go watch how people interact with people. Go to some of the great Lean companies. All these companies understand that the best gift they can give their employees is to allow them to share what they've learned with other people. It's a great motivator for people. So it's a real win win. So I think it begins with that you've got to see it first. And then you can start to assess where you stand.   0:24:13.6 JS: But we're talking about a transformation here, as Dr. Deming said. We're not talking about implementing a few tricks that we can superimpose on our management system. You've got to manage it completely differently to actually get this kind of intrinsic motivation to be a driving force in your workplace.   0:24:19.2 AS: It just made me think that I wanna come up with the five happiest companies in Bangkok and do a tour and take my students out and my teams out and my company managers out and let's go, you know, see how they're turning on intrinsic motivation, you know. And one thing about Thailand that's interesting is that what people want from work is very different than in the West.   0:24:50.1 JS: Right.   0:24:51.2 AS: And what people want from work is good relationships, harmony.   0:24:57.6 JS: Really.   0:24:57.8 AS: They want connection. They want meaning, more meaning from their work than the typical Western.   0:25:05.8 JS: Isn't that interesting? Interesting.   0:25:05.9 AS: And so when I see and I rail sometimes on to my students about, you know, be very careful about bringing this KPI disease into Thailand, where all of a sudden, you're setting up the Thai people to go against each other, which takes away from what is a core strength is their desire and ability to get along.   0:25:33.3 JS: Isn't that interesting? Wow, so they got a head start.   0:25:42.5 AS: Yeah. My first move to Thailand in 1992, I taught an MBA class. And the first thing I did is what was done with me in my MBA class is say, all right, here's a case study, break into groups, and then, you know, and then they came back and, and then after getting to know them in my first semester that I taught, now I've been teaching for 32 years in Thailand. The first lesson I learned is Thais do not need group work. They need individual work. And because they need to kind of flex that muscle.   0:26:08.8 AS: And then I thought, well, why are we do so much group work in America? Well, because it's Americans are trained and taught from the beginning to think independently, have their own idea, watch out for themselves. And they need help in, let's say, MBA classes to work together.   0:26:26.8 JS: Isn't that interesting?   0:26:26.9 AS: And so what I just saw was a very different dynamic.   0:26:30.3 JS: Wow.   0:26:30.9 AS: And it helped me also to understand that we... The good side of the American, let's say, I know, American worker, I know Americans, just 'cause that's where I grew up. But the good side of that is that there is a lot of independent thinking, they can come up with the good systems and all of that.   0:26:47.3 JS: Sure.   0:26:48.9 AS: But the bad side is that they're oftentimes fired up to be in competition with each other. And KPIs just ignite that fire that just...   0:26:58.2 JS: They do.   0:26:58.3 AS: Really causes, you know, a lot of damage.   0:27:00.5 JS: Well, I got to ask you something, then, do you think that that East versus West kind of mindset is why Dr. Deming's ideas were taken up in Japan when they had been kind of ignored in the US?   0:27:16.9 AS: Yeah, I mean, I definitely I mean, Japan is like an extreme example of Asia and trying to have harmony and everybody, the bigger mission is the company, the bigger mission is the community, the bigger mission is the country. I would say that Japan is like the ultimate in that. Thailand is less so there's more independence and people don't have to be completely allegiant to those things. But still, that desire to be happy at work is there, you know, I think it's there more, it's more innate, for some reason in Thailand, than I saw it in America.   0:27:55.8 AS: And I always explain that, when I worked in America, I think I never went out on a weekend with my colleagues.   0:28:04.5 JS: Really. Interesting.   0:28:05.3 AS: And in Thailand is a very common thing to arrange activities together with your workmates, and go bowling and do this and do that. And I thought, I saw that everywhere. And I was pretty, you know, that just was fascinating to me. So I really, you know, this discussion is all about opening up people's minds, that carrots and sticks are not the only way. And as you said, it's a transformation, it takes time, you got to think about it, you got to reconcile it.   0:28:37.8 JS: Well, and that brings up another really important point, Andrew. And that is that teamwork, team productivity really makes the difference in a company. And when you think about it, you've got a whole bunch of individuals that productivity is very often not gonna add up for reasons, you know, that we've already talked about, you know, it's not part of the system. So team productivity becomes really, really essential. But team productivity, and Kelly Allen actually pointed this out really well to me. And I mean, I'm gonna just look in my notes here to get his words exactly, 'cause he said it so well.   0:29:21.0 JS: Let's see here. And here's Kelly, "a useful operational definition of a team is the collaborative and coordinated efforts of people working together in an atmosphere of voluntary trust." So you got to build that. And, you know, that's kind of tough to do in a lot of North American companies.   0:29:48.5 AS: Yeah. It's such a great point. And I think I've recently been teaching a corporate strategy. And I talk about Michael Porter and all the he's taught about strategy. But one of the things that he mentions towards the end of his books is the idea of fit. And he's talking about how do the pieces fit together in the company. And everybody knows that feeling when the when the process before you or the process after you in your company is being run by somebody that you have a good fit with. It's like everything comes together. And so I think what I realize now is that the power of that coordination that Kelly Allen's talking about is all about how do we get these pieces fit together, working together, coordinating together. That's the magic.   0:30:37.3 AS: Interesting. But Porter, I mean, he talked about a lot of I think, you know, it's been a long time since I've looked at his books, but a lot of his stuff was either or, right? I mean, you know, you decide, am I gonna be a price leader or am I gonna be a quality leader? And I think a lot of what he did disregarded, you know, Deming's Chain Reaction, you know, where he where you actually invest in both. So I mean, that's got a problem and with strategy people in general. Now, I know you've taught strategy. So maybe you're gonna take me apart on this one. But it seems to me that the strategy folks are really missing something.   0:31:29.1 AS: Well, I think most people are missing the type of stuff that Dr. Deming's talking about, but I use an example of McDonald's and Starbucks.   0:31:35.5 JS: Okay.   0:31:37.3 AS: You know, one is a low cost leader. And one is a premium, you know, differentiated, you know, product and service. And we all know which one's which. So which one leads to a sustainable competitive advantage? Which one is better? I always talk to my students. And I say, the fact is, is that both of them have led to a competitive advantage. So part of what, you know, I would say, when I think about corporate strategy, from my perspective, is figure out the direction that fits your DNA, and then pursue that, whether that's about making, you know, I like to tell my students that think of a company run by an engineer, who may be focused on the processes and all that, who may create a very efficient operation, versus a business, let's say run by a marketing or sales person who has a much better contacting and messaging to the customer. Those two business owners should be developing their corporate strategy around their DNA, you know, and if they do that right, that, in theory, should lead to some competitive advantage.   0:31:58.9 AS: And to me, competitive advantage is how do we make sure that our company creates a level of profitability that is higher than the industry average over a sustained period of time. If we think we're doing a corporate strategy that works, and we're making a very low amount of profitability, I think that there's enough reason to argue that that's probably not achieving a competitive advantage.   0:32:37.1 JS: Yeah. And I think we have to put the word sustainable competitive advantage. But along the McDonald's, Starbucks, though, I have a very interesting twist. And I think this was done locally in Canada. But somebody did a blind test of coffees from various outlets to see what rated the highest. And I have to tell you that McDonald's coffee rated very high, higher than Starbucks. So...   0:33:47.1 AS: But it's definitely the case in Bangkok that McDonald's coffee is fantastic.   0:33:50.8 JS: Really.   0:33:51.8 AS: I happen to know very much about that. But I highly recommend that.   0:33:55.7 JS: Yeah. Well, I think we're, you know, we are focusing in this book, essentially on, you know, productivity. Now, marketing, marketing strategy and stuff like that is yeah, I'll acknowledge that. Sure. And that's maybe, you know, I think what Michael Porter was talking about it's very true in terms of marketing. But in terms of quality, output of quality, I think that's where the Deming magic and the Lean magic all come into play.   0:34:12.2 AS: Yeah, I mean, it took me a long time to figure out that what Dr. Deming saying is, if we are continually improving our products and service and our quality, we're driving down costs, and we're making people happier, and we're bringing more value to the market. How... Shall we wrap this up? And how would you summarize what you want people to take away from this?   0:34:26.1 JS: I would say that intrinsic motivation is underestimated in workplaces, it's misunderstood. It's not reflected in the way most companies are organized or their strategies. So it's a big learning curve for companies to create the kind of environment where intrinsic motivation is connected with the workplace. But I think it's worthwhile, it's a very, very important thing. And we have a lot of unhappiness in society. And a lot of it can be traced to a lack of that. So, you know, I hope that more companies will see the importance of this.   0:35:16.6 AS: You know, it's my, my friend who never... He was helping me when I was writing my book, Transform your Business with Dr. Deming's 14 points.   0:36:02.2 JS: That's a great book.   0:36:02.7 AS: And he was editing a book.   0:36:02.8 JS: I love that book, by the way.   0:36:04.3 AS: Thank you. I was trying to make it as simple as possible for the 14 points. But my friend, as he was helping me edit it, he turned to me after many hours of working together over many weeks, he said to me, I figured it out. Dr. Deming is a humanist, he cares about people. And that was just so funny, because he thought going into it, it's all gonna be about, you know, charts and graphs and statistics. And I think that's, you know, that's the key, it's the mindset. I wanna wrap up by by just going through some of Dr. Deming's 14 points that apply to what we're talking about. And, you know...   0:36:39.2 JS: Great.   0:36:39.6 AS: The question really is, you know, when my friend said that Dr. Deming was a humanist, it's 'cause as he started working on the 14 points with me, he started to realize, just listen to these points. Here's point number eight, drive out fear. Yeah, that's critical to having a joyful workplace. Number nine, break down barriers between department. That's the source of so much trouble for people at work is that they're working in silos. Number 10, eliminate slogans and targets and exhortations. Stop focusing on pushing the workers constantly. Figure out how to improve the system.   0:37:10.2 AS: Number 11, eliminate work standards or quotas, eliminate management by objective, management by numbers, substitute leadership. And number 12, remove barriers that rob the hourly worker of the right to pride of workmanship. Remove barriers that rob people in management and engineering of their right of pride of workmanship. My goodness, from eight, nine, 10, 11, 12, all focused on this concept of intrinsic motivation. And to me, that thinking, changing that thinking is what's so critical. Anything you would add as we wrap up?   0:37:25.0 JS: Yeah, I will add one thing to that. And this is very strongly in the book. That is why the first step if you're gonna transform your company is making everybody feel safe. That's got to be the first step, even before you start training them with methods and things like that. You have to build safety, then you can build trust.   0:37:47.2 AS: Fantastic. Well, Jacob, on behalf of everyone at the Deming Institute, I wanna thank you again for this discussion. And for listeners, remember to go to deming.org to continue your journey. So much happening there. You can find Jacob's book, Productivity Reimagined at jacobstoller.com. And this is your host, Andrew Stotz. And I'll leave you with one of my favorite quotes from Dr. Deming that I just never stop talking about. And today we talked about it a lot. And that is, "People are entitled to joy in work."  

O convidado do programa Pânico dessa quinta-feira (17) é Sandro Magaldi. Sandro Magaldi é professor e palestrante. Lecionou em instituições como ESPM, Fundação Dom Cabral e PUC-RS, além de ter apresentado centenas de palestras para grandes organizações, impactando centenas de milhares de pessoas. Atualmente, é conselheiro do projeto social Gerando Falcões e autor de diversos artigos publicados em revistas de negócios. Pós-graduado pela ESPM, possui mestrado em Administração pela PUC-SP. Magaldi é coautor do best-seller “Gestão do Amanhã”, que está em sua 15ª edição, e responsável por outras nove obras, incluindo "Estratégia Adaptativa", "O Novo Código da Cultura" e "Liderança Disruptiva". No total, seus livros já superaram a marca de 900 mil unidades vendidas. Sua mais recente obra é "A Estratégia do Motor 2 de Crescimento". Sandro Magaldi também é cofundador do meuSucesso.com, uma das principais plataformas de empreendedorismo do Brasil. Com mais de 30 anos de experiência em liderança e vendas, Sandro ocupou cargos executivos de destaque, como Diretor Comercial da HSM. Em sua trajetória, trabalhou diretamente com alguns dos maiores pensadores globais de gestão, como Philip Kotler, Michael Porter e Jack Welch. Como comentarista, o programa traz Junior Masters (Redpill), produtor de conteúdo e host do Redcast.

Understanding the Five Disqualifiers of Strategy with Peter Compo   Welcome back to another episode featuring Peter Compo, the renowned author of 'The Emergent Approach to Strategy.' In today's discussion, Peter delves deep into the 'Five Disqualifiers of Strategy,' offering insights into common pitfalls in strategic design. The episode is packed with practical examples and explanations of why traditional strategy tests often fall short. Peter illustrates the importance of real-time guidance, unified decisions, and free choices in strategic frameworks. Learn about five critical tests to evaluate your strategy: 'Is the opposite absurd?', 'Does it have numbers?', 'Does it exclude anything?', 'Does it duplicate the higher-level organization?', and 'Is it a list?'. This episode is essential for anyone involved in business strategy, innovation, and better thinking.   00:00 Introduction and Welcome 01:01 The Importance of Strategy Testing 01:40 Traditional vs. Modern Strategy Tests 02:17 Introduction to the Five Disqualifiers 05:24 Detailed Explanation of the Five Disqualifiers 06:33 Practical Examples and Applications 08:37 Common Pitfalls in Strategy 18:55 The Role of Clear Language in Strategy 21:43 Summary and Conclusion 38:14 Next Episode Preview   Link to Peter's website:   Link to Peter's Music:   Link to Aidan McCullen for Keynotes, workshops and event MC.   Find us on Substack for Shownotes and competitions:   strategy, disqualifiers, Peter Compo, Aidan McCullen, emergent approach, strategy design, business strategy, adaptive tools, Michael Porter, McKinsey, corporate strategy, innovation, Henry Ford, Warren Buffett, R&D, market dynamics, organizational strategy, DVD business, Netflix, Adobe  

In today's episode, Shawn O'Malley (@Shawn_OMalley_) breaks down different investors' approaches to finding the best of the best companies to own. It's a strategy known as Quality Investing, and it differs from value investing because quality investors are more focused on finding companies to own forever, as opposed to selling them if they rise above their current intrinsic value. You'll learn how definitions of quality vary, how quality investing is still rooted in value investing, what the patterns and building blocks of high-quality companies are, why pricing power is a great way to identify quality businesses, how Chuck Akre approaches quality investing, what Jim Collins' research on enduringly great companies reveals, and how Chris Mayer finds stocks with 100-to-1 returns—plus so much more! IN THIS EPISODE, YOU'LL LEARN 00:00 - Intro 02:15 - How Quality Investing traces back to Ben Graham 03:10 - What quality investing is generally, and how it differ from other strategies 03:32 - What are the patterns and building blocks of quality businesses 07:51 - Why pricing power is so important to quality stocks 12:37 - How Chuck Akre's three-legged stool approach to quality investing works 22:12 - What Jim Collins' intensive study of enduringly great companies reveals for investors  29:57 - How Chris Mayer finds stocks that generate 100-to-1 returns 32:46 - How to define and determine whether a company has a winning corporate culture  41:55 - Why quality investing is really an art form And much, much more! *Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences. BOOKS AND RESOURCES Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Kyle and the other community members. Compounding Quality's Investing Philosophy. Three-Legged Stool Masterclass. Chris Mayer's blog Jim Collins' book, Built to Last. Thomas Peters' book, In Search of Excellence. Michael Porter's book, Competitive Advantage. Lawrence Cunningham's book, Quality Investing. Thomas Phelps' book, 100 to 1 in the Stock Market. Jim Collins' book, Good to Great. Chris Mayer's book, 100 Baggers. Long Equity's book, The Intelligent Quality Investor. Check out the books mentioned in the podcast here. Enjoy ad-free episodes when you subscribe to our Premium Feed. NEW TO THE SHOW? Follow our official social media accounts: X (Twitter) | LinkedIn | Instagram | Facebook | TikTok. Check out our Millennial Investing Starter Packs. Browse through all our episodes (complete with transcripts) here. Try Kyle's favorite tool for picking stock winners and managing our portfolios: TIP Finance. Enjoy exclusive perks from our favorite Apps and Services. Stay up-to-date on financial markets and investing strategies through our daily newsletter, We Study Markets. Learn how to better start, manage, and grow your business with the best business podcasts. SPONSORS Support our free podcast by supporting our sponsors: Range Rover Public Toyota Airbnb Facet Found Fundrise NetSuite Connect with Shawn: Twitter | LinkedIn | Email HELP US OUT! Help us reach new listeners by leaving us a rating and review on Apple Podcasts! It takes less than 30 seconds, and really helps our show grow, which allows us to bring on even better guests for you all! Thank you – we really appreciate it! Learn more about your ad choices. Visit megaphone.fm/adchoices Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

Roger Martin is one of the world's leading experts on strategy and the author of Playing to Win, one of the most beloved books on strategy. He's written extensively for the Harvard Business Review; consulted for dozens of Fortune 500 companies, including P&G, Lego, and Ford; and written 11 other books. In our conversation, we discuss:• The five key questions you need to answer to develop an effective strategy• Why most companies get strategy wrong• How to avoid “playing to play” instead of playing to win• Real-world strategy examples from Procter & Gamble, Southwest Airlines, Lego, and Figma• How to think about differentiation vs. low cost• Shortcomings of current strategy education• Much more—Brought to you by:• Webflow—The web experience platform• WorkOS—Modern identity platform for B2B SaaS, free up to 1 million MAUs• Cycle—Your feedback hub, on autopilot—Find the transcript at: https://www.lennysnewsletter.com/p/the-ultimate-guide-to-strategy-roger-martin—Where to find Roger Martin:• X: https://x.com/RogerLMartin• LinkedIn: https://www.linkedin.com/in/roger-martin-9916911a9/• Website: https://rogerlmartin.com/—Where to find Lenny:• Newsletter: https://www.lennysnewsletter.com• X: https://twitter.com/lennysan• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/—In this episode, we cover:(00:00) Roger's background(02:20) The importance of strategy(07:00) Challenges in developing strategy(08:30) Critique of modern strategy education(14:00) Hamilton Helmer and Richard Rumelt(17:40) Defining strategy(19:12) The Strategy Choice Cascade(23:20) Playing to win vs. playing to play(24:57) Examples of strategic success(30:49) Differentiation and moats(40:23) Applying strategy to real-world scenarios(43:47) Customer-centric strategy(44:45) Defining the market and product(45:59) Value chain and distribution(48:28) Cost leadership vs. differentiation(53:16) Capabilities and management systems(57:14) Competitive advantage and market positioning(01:02:41) Counterpositioning and fault lines(01:05:53) Adapting to AI and market changes(01:14:11) Betterment over perfection(01:18:42) Final thoughts on strategy—Referenced:• Nearly 10% of S&P 500 CEOs are alumni of Procter & Gamble: https://www.bizjournals.com/cincinnati/news/2023/02/06/10-of-s-p-500-ceos-pg.html• FigJam: https://www.figma.com/figjam/• Figma: https://www.figma.com/• What Is Resource-Based Theory?: https://www.igi-global.com/dictionary/the-impact-of-technological-governance-and-political-capabilities-on-firms-performances-under-economic-turbulence/67915• Michael Porter on LinkedIn: https://www.linkedin.com/in/professorporter/• Competitive Strategy: Techniques for Analyzing Industries and Competitors: https://www.amazon.com/Competitive-Strategy-Techniques-Industries-Competitors/dp/0684841487• VRIO Framework Explained: https://strategicmanagementinsight.com/tools/vrio/• Business strategy with Hamilton Helmer (author of 7 Powers): https://www.lennysnewsletter.com/p/business-strategy-with-hamilton-helmer• Good Strategy, Bad Strategy | Richard Rumelt: https://www.lennysnewsletter.com/p/good-strategy-bad-strategy-richard• 7 Powers: The Foundations of Business Strategy: https://www.amazon.com/7-Powers-Foundations-Business-Strategy/dp/0998116319• Boston Consulting Group: https://www.bcg.com/• Bruce Henderson: https://en.wikipedia.org/wiki/Bruce_Henderson• Lego: https://www.lego.com• Vanguard: https://investor.vanguard.com/• Southwest Airlines: https://www.southwest.com/• How Amazon Managed to Dethrone Walmart: https://www.nytimes.com/interactive/2021/08/20/technology/how-amazon-beat-walmart.html• GM Lost a 10-Year Battle with Tesla, Pulling the Plug on a Long Line of EVs: https://www.forbes.com/sites/brookecrothers/2023/07/09/gm-killed-its-electric-cars-and-lost-a-10-year-battle-with-tesla/• Westlaw: https://www.westlawinternational.com/• What Is an Economic Moat? Why Warren Buffett Says It Matters for Investors: https://finance.yahoo.com/news/economic-moat-why-warren-buffett-160046125.html• Salomon Brothers: https://en.wikipedia.org/wiki/Salomon_Brothers• US Airways: https://en.wikipedia.org/wiki/US_Airways• Four Seasons: https://www.fourseasons.com/• Michael Dell on LinkedIn: https://www.linkedin.com/in/mdell/• Bill Gates on LinkedIn: https://www.linkedin.com/in/williamhgates/• Mandarin Oriental: https://www.mandarinoriental.com/en/• Continental Lite: https://en.wikipedia.org/wiki/Continental_Lite• Ted (airline): https://en.wikipedia.org/wiki/Ted_(airline)• Case Study: Oil of Olay: https://www.studocu.com/es/document/universidad-de-murcia/estrategia-de-marketing/case-study-old-of-olay/95079369• AG Lafley on LinkedIn: https://www.linkedin.com/in/ag-lafley-2381b3201/• Jack Bogle: https://en.wikipedia.org/wiki/John_C._Bogle• Seven Ways Windows 95 Changed the World: https://www.forbes.com/sites/ianmorris/2015/08/24/windows-95-changed-the-world/• Where to Start with Strategy? Focus on Betterment: https://rogermartin.medium.com/where-to-start-with-strategy-bae40506304c• Brick by brick: The man who rebuilt the house of Lego shares his leadership secrets: https://www.washingtonpost.com/news/on-leadership/wp/2016/12/08/brick-by-brick-the-man-who-rebuilt-the-house-of-lego-shares-his-leadership-secrets/• A New Way to Think: Your Guide to Superior Management Effectiveness: https://www.amazon.com/New-Way-Think-Management-Effectiveness/dp/164782351X/• Playing to Win: How Strategy Really Works: https://www.amazon.com/Playing-Win-Strategy-Really-Works/dp/142218739X• The Design of Business: Why Design Thinking Is the Next Competitive Advantage: https://www.amazon.com/Design-Business-Thinking-Competitive-Advantage/dp/1422177807• The Opposable Mind: How Successful Leaders Win Through Integrative Thinking: https://www.amazon.com/Opposable-Mind-Successful-Integrative-Thinking/dp/1422118924• When More Is Not Better: Overcoming America's Obsession with Economic Efficiency: https://www.amazon.com/When-More-Not-Better-Overcoming/dp/1647820065—Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com.—Lenny may be an investor in the companies discussed. Get full access to Lenny's Newsletter at www.lennysnewsletter.com/subscribe

American politics is trapped in a duopoly, with two all-powerful parties colluding to stifle competition. We revisit a 2018 episode to explain how the political industry works, and talk to a reformer (and former presidential candidate) who is pushing for change. SOURCES:Katherine Gehl, former president and C.E.O. of Gehl Foods.Michael Porter, professor at Harvard Business School.Andrew Yang, co-chair of the Forward Party and former U.S. presidential candidate. RESOURCES:"Why U.S. Politics Is Broken — and How to Fix It," by Andrew Yang (TED, 2024).The Politics Industry: How Political Innovation Can Break Partisan Gridlock and Save Our Democracy, by Michael Porter and Katherine Gehl (2020).“Why Competition in the Politics Industry is Failing America,” Katherine Gehl and Michael Porter (Harvard Business School, 2017).“Stronger Parties, Stronger Democracy: Rethinking Reform,” by Ian Vandewalker and  Daniel I. Weiner (Brennan Center for Justice, 2015).On Competition, by Michael Porter (2008).Competitive Strategy: Techniques for Analyzing Industries and Competitors, by Michael Porter (1980). EXTRAS:"Andrew Yang Is Not Giving Up on Politics — or the U.S. — Yet," by People I (Mostly) Admire (2021)."The Future of New York City Is in Question. Could Andrew Yang Be the Answer?" by Freakonomics Radio (2021)."Why Is This Man Running for President? (Update)," by Freakonomics Radio (2019).“Ten Ideas to Make Politics Less Rotten,” Freakonomics Radio (2016).