Anecdotes about the Skunkworks
This treasure is from Ben Rich's book Skunkworks.
Ben told Kelly about his plan to attend a 13-week advance program at Harvard Business School, which was only available to 150 carefully selected executives. Kelly wrote Ben a glowing recommendation, but still insisted that it would be a complete waste of Ben’s time.
"I’ll teach you all you need to know about running a company in one afternoon, and we’ll both go home early to boot. You don’t need Harvard to teach you that it’s more important to listen than to talk. You can get straight As from all your Harvard profs, but you’ll never make the grade unless you’re decisive: even a timely wrong decision is better than no decision. The final thing you need to know is don’t half-heartedly wound problems – kill them dead. That’s all there is to it. Now you can run this (excerpt) place. Now, go home and pour yourself a drink."
After Ben completed the program and returned to Skunk Works, Kelly asked him for his appraisal of the Harvard Business School. Ben wrote the equation: 2/3 of HBS = BS .
October 1994 Article by Stuart Brown. He interviews Ben Rich and discusses the SR-71 and working with Kelly Johnson.
Prominent Business Management Thinkers
Outline of selected authors from the book The Ultimate Business Library: 50 Books That Made Management (Ultimates) by Stuart Crainer
1. Ansoff, Igor
a. Wrote Corporate Strategy to “codify and generalize” his work at Lockheed Corporation.
b. Created “Ansoff Model of Strategic Planning” which identifies a decision making process from aggregated to more specific. The procedure is a cascade where
i. Set objectives established
ii. Gap of current position vs. objectives is estimated
iii. One or more strategy are proposed
iv. Strategies are tested for “gap-reducing properties”
c. Created the word “synergy”
d. Precursor to “corporate advantage”
e. Corporate Strategy relies heavily on analysis, thus Ansoff labels “analysis by paralysis”
2. Argyris & Schon
a. Organizational Learning (1978)
b. Precursor to Senge’s Fifth Discipline
c. Investigate 2-organizational models:
i. Model 1
1. Manipulation by managers
2. Goal focused
3. “Cone of silence”, head down and do the work, do not ask questions
4. Considered Single-Loop Learning
ii. Model 2
1. Emphasis on “Double Loop Learning”
2. When an error is detected, orgs debate solution, act on change, learn from others
d. Most orgs do well in Single Loop Learning, but struggle with Double
3. Bartlett & Ghoshal
a. Managing Across Borders (1989)
b. Identify difficulties in growth through acquisition and dangerously high levels of diversity
c. 4 Types of multi-national firms
i. Multi-National - Multi-domestic, power in local responsiveness
ii. Global – efficiencies of scale, cost advantages
iii. International – ability to transfer knowledge and expertise overseas
iv. Transnational – combines local responsiveness w/ ability to xfer knowledge
d. Define Emerging Organizational Model
i. Entrepreneurial Process – drive external opportunity seeking for new business
ii. Integration Process – Allows link to leverage dispersed resources and competencies
iii. Renewal Process – maintains corporate values and practices
4. Bennis & Nanus
a. Leaders: The Strategies for Taking Charge (1985)
b. Bennis interviews 90 American leaders
i. Management of Attention: Vision, shared with team members
ii. Management of Meaning: Communication, incl. choosing the right forum (memo, email, booklet, press release, face-to-face meeting)
iii. Management of Trust: The glue that binds…must have with team, common to all leaders
d. Worst problem in leadership is early success, no chance to learn from adversity and problems
e. 5 myths of leadership need to be overcome. Should be understood that:
i. Leadership is not a rare skill
ii. Leaders are made rather than born
iii. Leaders are mostly ordinary people
iv. Leadership is not solely the reserve of upper management
v. Leadership is not about control, direction, and manipulation
5. Champy & Hammer
a. Re-engineering the Corporation (1993)
b. Theme: Identify key processes and make them lean and efficient as possible
c. Re-engineering is “fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical measures of performance such as cost, quality, service, and speed.”
d. Business Process Re-engineering is too limiting, we must stop paving the cow paths
i. Mintzberg (1996) disagrees with the concept of reengineering. It’s just same old notion that a new system will solve the problem.
ii. Reengineering has become synonymous w/ redundancy
iii. CSC’s report The State of Reingineering (1994) found that 336 US jobs and 760 Europe jobs were lost per reengineering project.
iv. Organizations are not willing to change by nature, mgmt often forces change, but does not adopt change itself.
v. Efforts fall short b/c absence of trust “respect for the individual, his or her goodwill, intelligence, and native, but long shackled, curiosity.” (Peters, 1993)
a. Strategy and Structure (1962)
b. Researched US companies between 1850 – 1920
c. A firms structure is dictated by its chosen strategy; “Unless a structure follows strategy, inefficiency results”
i. Thesis that “structure follows strategy” was largely accepted until the 1990’s.
ii. “I think he got it exactly wrong. For it is the structure of the organization that determines, over time, the choices that it makes about the markets it attacks.” (Peters, 1992)
iii. In Managing on the Edge (Pascale, 1990)
a. Out of the Crisis (1982)
b. Three concepts in Out of the Crisis:
i. If consistent quality is to be achieved, senior managers must take charge of quality
ii. Implementation takes a cascade training model from the top down.
iii. Use statistical methods for QC is necessary
c. “Management for Quality” (Deming)
d. To Deming, management accounts for 90% of the problem
e. Western mgrs have annual appraisals, Japanese have daily feedback
f. 14-Points on quality management
a. Predicted the rise of the Corporation
b. Age of Discontinuity (1969), describes “Knowledge Worker”
c. Calls for strategic planning to manage change
d. Entrepreneurship offers a way to manage change
e. Marketing concept
i. Consumer sovereignty
1. Look at business from customer’s perspective
ii. Consumer Rationality
iii. Utility function
1. How customers use and benefit from product
iv. Distinction between sales and marketing
v. Systems Approach
vi. Demand Faction
f. Ask two questions: What will the business be, what should the business be?
g. Role of executive is to:
i. Sharpen corporate vision
ii. Generate improved performance
iii. Become increasingly effective thru learning and practice