Management Article

Knowledge at Wharton’s picture

By: Knowledge at Wharton

Time was, layoffs were seen as an emergency strategy, the last resort in a downturn or crisis. Today, however, layoffs are a standard tool for doing business. As the economy continues to heal and job indicators improve, a number of firms have announced a fresh wave of layoffs—Nordstrom, Sprint, and American Express among them—citing the need to improve profitability.

Studies have shown that layoffs don’t generally result in improved profits. And yet, firms continue to keep the pink slips at the ready. Why?

Norman A. Paradis’s picture

By: Norman A. Paradis

The last few months have witnessed the unraveling of the remarkable life sciences company Theranos, culminating in the news that federal regulators may ban Theranos founder Elizabeth Holmes from the blood-testing industry for at least two years. The company is also facing a federal criminal investigation into whether its investors were misled about its technology and company operations.

How has this widely acclaimed biomedical innovator fallen so far, so fast?

Theranos’ revolutionary claim that won over investors was that it could accurately run tests using a small amount of blood taken from a poke in the patient’s finger, instead of a syringe full from a needle stuck in a vein. The idea was that dozens of tests, such as cholesterol and thyroid hormone levels, could be run on a single, tiny blood sample.

Tab Wilkins’s picture

By: Tab Wilkins

Recently I came across the PriceWaterhouseCoopers U.S. CEO Survey and watched several videos about leadership challenges for manufacturers. The speakers talked about new and old trends they’re focused on as company leaders, as well as several trends that could apply to small and medium-sized manufacturers.

The top five leadership challenges in the survey included:
• Harnessing digital media
• Integrating diversity of the workforce
• Technology adoption in manufacturing
• Developing emerging markets
• Partnering

Naveen Khajanchi’s picture

By: Naveen Khajanchi

Adam Grant, a professor of psychology at Wharton, admitted how wrong he was to pass up on the opportunity to invest in an online startup selling glasses. Because the company didn’t have a functioning website the day before its launch, and because other competitors were already operating in the space, he didn’t invest. He thought the startup’s procrastination showed a lack of commitment. But the company, Warby Parker, went on to be recognized as one of the world’s most innovative companies and was subsequently valued at over a billion dollars.

In his later research into original thinkers, Grant found that procrastinators are more creative than planners, and “improvers” (those who enter an existing industry with an improved idea) have a lower failure rate than “first-movers.” The founders of Warby Parker weren’t dragging their feet; they were spending their time thinking about bigger issues, such as how to make people feel comfortable buying glasses online, not how to get online as quickly as possible. It didn’t fit the mold of what Grant thought an enterprising startup should be, but it worked.

Amy Williams’s picture

By: Amy Williams

My first exposure to manufacturing was nearly 21 years ago. My on-the-job training was brief and mainly consisted of general safety, machine operating, and maintenance instructions with little focus on problematics or quality requirements. After all, I wasn’t forming sheet metal for an airplane; I was sewing a feed sack. Nearly a decade later I realized sewing feed sacks on a production line was the beginning of my career path and commitment to quality.

Quality isn’t subjective, and neither is its relevance measured by the product. Quality is the foundation of an organization.

Regardless of your industry, nonconformity is a reality, and we must all remain committed to managing the contributing factors.

When an organization neglects to properly analyze the root cause of nonconformity—becoming too accepting of responses indicating an uncontrollable factor—we have not only misused the process, but also potentially crippled our ability to effectively problem solve.

Tim Lozier’s picture

By: Tim Lozier

When we look at business dynamics, regardless of industry, we see an increasing rate of change in products, processes, and regulations. One process affects the next, and with a growing focus on regulations and standards, complexity becomes an ever-expanding theme, whether related to quality management or general compliance.

The consequence is that organizations are becoming more complex. Businesses are increasing their global footprint. Couple that with the addition of mergers and acquisitions, and you begin to see disparate trends in quality and compliance. As we get more complex, our organizational cultures change.

A more complex world means that the level of regulation shifts. Whether a company operates solely in the domestic arena or worldwide, it is faced with regulations from the local to the international. These vary by country and region, and shift constantly to meet complex requirements. Organizations must ensure that quality and compliance are achieved as they continue to roll out new process and products, and employees need adequate training to keep quality and safety considerations in line with these new complexities.

Ken Levine’s picture

By: Ken Levine

One poorly understood concept in lean Six Sigma is how much to “stretch” when setting S.M.A.R.T. goals. These letters are defined as S—specific; M—measureable; A—assignable, attainable, or achievable; R—realistic, reasonable, or relevant; and T—time-based or time-bound. Regardless of the different interpretations, what do we really mean by these terms?

Clearly, we don’t want to set ourselves (or others) up with impossibly high goals or low-level objectives that discourage motivation. If you have worked in sales or other jobs where at least a portion of your wages were based on pay-for-performance, you know what I’m talking about. How can a manager know what an individual is capable of selling? How can a team leader know what is applicable to an improvement project?

Joby George’s picture

By: Joby George

Driven by market expansion, financial pressures, and the need to accelerate innovation, today’s manufacturers have expanded their global operations and supply partners. This evolution has only amplified the manufacturer and supply-chain relationship, which is often characterized by a delicate balance between cooperation and adversarial negotiation.

In this new era, stakeholders are required to connect, interact, and integrate on previously unknown and unexpected levels. As such, manufacturers, suppliers, and contract manufacturing organizations (CMOs) are seeking new and direct ways to collaborate efficiently and effectively in their handling of quality events in order to achieve the financial benefits that can be measured in hundreds of thousands of dollars in annual savings from operational efficiencies—not to mention millions of dollars from avoiding commercial recalls.

Effective supplier management is a critical component of a company’s overall approach to quality management. Leading companies have employed four key steps to implementing a supplier quality management program that takes the complexity out of managing supplier quality, and allows them to put a program in place that has sustainable business benefits.

GBMP’s picture

By: GBMP

Hub Pen Co., located in Braintree, Massachusetts, imports specialty writing instruments and imprints them with company logos and other customized inscriptions. In 2013, the company received a grant for training in lean and continuous improvement, which was delivered by the Greater Boston Manufacturing Partnership (GBMP). Hub Pen’s three-year strategic vision called for a 50-percent increase in sales, a 50-percent reduction in scrap, a 30-percent increase in productivity, and 100-percent employee participation in the initiative. The company has met and surpassed most of these goals.

As a result of the training, weekly huddles take place at both the departmental and managerial level. At each department’s meeting, progress toward goals is reviewed, and problems and potential improvements are discussed. At the managerial level, the group assesses quality, service and costs, delivery, sales, safety and HR metrics.

Knowledge at Wharton’s picture

By: Knowledge at Wharton

A trained mechanical engineer, Mark Chang found himself “totally uncertain and unprepared” the first time he was called on to hire someone else.

“I didn’t even know why I was hired in the first place—what did they like about me?” Chang recalls. “So, how do I go out and look for the next person?”

Years later, Chang is now in the business of helping companies find good candidates to hire. He’s the founder and CEO of JobStreet.com, a Malaysia-based employment portal serving 80,000 companies and 11 million job seekers in Southeast Asia, Japan, India, the Philippines, and Western Europe.

At a panel discussion on human capital and social mobility at the recent Wharton Global Forum in Kuala Lumpur, Chang noted that it’s often difficult for even experienced HR professionals to hire the right person—or even to figure out what defines the “right” candidate for a particular position. The process has become even more fraught as companies become increasingly global and managers are overseeing employees who hail from a number of different countries and cultures, many of them working remotely.

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