Re: The New Economics

[FVoehl@aol.com]

In a message dated 7/31/01 1:19:45 AM, dfkerridge@mac.com writes:

<< So the costs of innovation are too high. And when change
comes, as it inevitably will, the company may go out of business.
This does not just harm the company, but the economy as
a whole. >>

David's point bring to mind Dr. Deming's story parable about the Empire Buggy 
Whip Manufacturing Company at the turn of the century and may be a useful way 
to extend his teaching and thinking.  It seems that the Buggy Whip 
Manufacturing Co was the most efficient buggy whip company of its day.  Every 
buggy whip they made was engineered to specification, they rarely broke, and 
whenever they had a customer service problem, it was resolved quickly.  So 
what was the problem?

They didn't understand the difference between efficiency and effectiveness, 
and they didn't have a vision for the future.  They thought that doing things 
right the first time (efficiency) was the key and they missed the real 
key--doing the right things right the first time (effectiveness).  It seems 
that they were so inwardly focused that they didn't see the horseless 
carriage coming (lack of vision), and in ten years they were out of business.

The moral of the story:  They thought that they were in the buggy whip 
manufacturing business and they forgot that they were in the transportation 
business.  This lack of vision speaks volumes about the lack of 
transformational leadership.  So what are we as leaders to do?

(1) Understand your business market (2) develop a compelling vision (3) Give 
it meaning for all parts of the organization (4) Position the organization to 
pursue it (5) Facilitate organizational learning (6) create a feeling of 
being at the active centers of social order and (7) reward, recognize, and 
have fun.

Frank Voehl (FVoehl@aol.com)