The Management Engineering Difference
Today’s management efforts include outsourcing, benchmarking, management to goals and objectives, and accountability studies. None of these has any part in management engineering.
The difference is between “management improvement” and “optimized management.”
The one is based on modifying what we have, in order to gain better results.
The other is based on finding a “best” way to accomplish a desired result.
Management Improvement strives to provide the manager with systematic approaches to improve the processes of management. Its focus is on the quality of a manager’s performance. Optimized Management strives to improve the effect of management, its impact on performance relative to the cost of gaining that impact. Its focus is on the whole cost to gain a result, and the value of the result. It is a wider study.
Management Improvement lends itself to programs and systematic approaches to the behavior of managers. Optimized Management recognizes the need for providing working managers with basic tools that support the manager’s efforts for gaining results through others.
Management Improvement is focused on management as what the manager accomplishes. Optimized Management is focused on what management accomplishes through others.
Management Improvement has managers create their own goals and objectives, and then measure against those. Optimized Management comes from addressing impacts on the two key metrics,
the value produced by an organized effort,
the cost of operating the organization while it produces that value.
Outsourcing is a performance technique; it has no effect on value produced, but will have effect on cost of operations. Its use may be under-represented, but is it just one among many potential techniques. Mandating its use makes no more sense than forbidding it. Efficiency is maximized by selecting the most appropriate technique for the situation being encountered.
Benchmarking is amateur efficiency work. It is based on finding the best that people are doing, and trying to do it the way that they do. That is the extent of the knowledge applied – and the result will contain all the inefficiencies that are found in the other party’s process, with possible addition from differences in your performance situation or environment and theirs. Efficiency will be optimized only based on knowledge of management structures and processes in relation to the two key metrics.
Management to goals and objectives requires intentional mismanagement; it addresses manager-derived goals and objectives as being more important to the manager than performance. It involves the basic abandonment of performance management to pursue locally determined management goals. Suboptimization in management is perhaps the mildest of the negative results. Efficiency comes from managing performance, not from focusing on other “good management” practices.
Accountability studies are a form of goal seeking, raising accountability for non-performance items as a direction for management, starting with a redirection away from the optimum effort based on performance. The only central accountability is for product delivered to customers to earn income. If increased accountability does not yield increased organizational performance, then why bother.
Management Engineering is built on basic understandings of performance management. It has techniques such as functional modeling, guidance for making internal investments, engineered assignment processes, and generally approaching management as a value-adding work effort.
As a final note, we have been doing modern management techniques for half a decade, and the size and cost of management has continued to grow relative to the performance that it gets through subordinate organizations. It hasn’t made us efficient. Management engineering, is a set of techniques that have been effective wherever used, starting from their initiation almost a century ago.
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