Questionable Assertions:
Let’s Take a Second Look

Comments on my post on In Search of Excellence and the limits to management "research" were heartwarming—thanks! One, however, was so off base that I felt it necessary to reply. Some of the misconceptions, I fear, are widespread:

Comment: "Suppose we had done both—apply Japanese style management (invented by an American by the way) and also still had our IBM's, HP, J&J's etc. I think In Search of is partly responsible for the downfall of manufacturing because it became uncool."

TP/me: (1) Wrong book; In Search was almost all manufacturers—it was Liberation Management, in 1992, that focused on services—and I wouldn't change a word, or at least not many. (2) Manufacturing is hardly dead in the U.S.; that is hogwash; it's microchips and software and biotech and medical devices, not so much autos; mfg as a share of GDP has been pretty much steady, or no more than a tick down, for years in the U.S.—it just doesn't take many people to make things anymore (that's called productivity improvement, the #1 engine of economic growth). (3) Every major economy in the world, even Germany, is a "service economy." Period. (4) Remember that the "service" part includes "services added" to manufacturing—consider the likes of GE Aircraft Engines, GE Power Systems, GE Medical Devices—over half the revenues of these outfits comes from "services added," such as life-cycle service packages for customers. (5) Last time I heard, IBM-J&J-HP were all three very alive and very well—e.g., HP just became the first $100-billion computer company in the world! (6) The Japanese economy has been in or near the tank for a decade-and-a-half now; not clear they're a great role model; among other things, Japan doesn't generate many entrepreneurs (which is crippling at a time of tech change), and they've had to "offshore" a ton of manufacturing as their wages soared—a good thing. (7) Fact is, we did indeed re-import many if not all the "Japanese techniques," such as TQM and Continuous Improvement—and our car companies' problem is not manufacturing quality, which is by and large at parity with the Japanese, Koreans, etc.; the problem is mostly high wages and benefits, which ordinarily would be called a good thing (e.g., improving workers' well-being); and by the way, Japanese auto companies' sales are as much in the tank as ours—for God's sake, even Toyota is reorganizing.

Back to you ...

Tom Peters posted this on April 15, 2009, in Excellence.
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