High Output Management is a classic management book by Andy Grove, former CEO of Intel. It’s often mentioned by Silicon Valley types as one of their favourite books, yet it’s not well-known or widely available in the mainstream: I had to read it as a paperback (for the first time in years) because there’s no Kindle version.
It really is a brilliant book: precise, simple, and logically ordered. Grove makes a new idea “land” in a short sentence, where other writers might take a whole chapter.
These notes were written for my reference, so focus only on the ideas that are particularly relevant to me. If you like the look of what you see, I strongly recommend reading the book in full.
The key idea of High Output Management
The core insight is that a manager’s output is equal to the output of the organisation under him or her.
This neatly clarifies what “the point” of a manager is. Their role isn’t just to supervise so things don’t descend into chaos, or to report up the chain, or to “do the work” to a high standard so others can turn to them for help if needed. Their role is to take actions that increase the output of those in their team to a point far beyond what it would be if no manager were present.
Managers should therefore be selecting activities that bring about the greatest potential increase in team output – which Grove calls “high leverage” activities – and performing them well.
In this framing, meetings – often seen as a waste of time that get in the way of proper work being done – are, in Grove’s words, “the medium through which managerial work is performed”.
For every activity a manager performs, the output of the organisation should increase by some degree.
High leverage activities
The art of management lies in the capacity to select from the many activities of seemingly comparable significance the one or two or three that provide leverage well beyond the others and concentrate on them.
There are three basic ways in which managers can achieve leverage:
- When many people are affected by one manager (like a finance manager setting out the process that hundreds of people will follow to produce an annual budget)
- When a person’s activity or behaviour over a long period of time is affected by a manger’s brief, well-focused set of words or actions (like a one-to-one or review)
- When a large group’s work is affected by an individual supplying a unique, key piece of knowledge or information (like training salespeople, or presenting a new idea to a group)
Grove notes that leverage can be negative. If a manager meddles and micro-manages, their subordinate might show less initiative in future and therefore be less effective. Similarly, arriving unprepared for a meeting and asking basic questions will reduce the effectiveness of the group’s time.
How many subordinates should a manager have?
Grove has a rule-of-thumb that each subordinate should get about half a day of a manager’s time per week, so a maximum of six to eight subordinates is about right.
Delegation as leverage
Delegation without follow-through is abdication. You can never wash your hands of a task. Even after you delegate it, you are still responsible for its accomplishment, and monitoring the delegated task is the only practical way for you to ensure a result.
Monitoring is not meddling, but means checking to make sure an activity is proceeding in line with expectations. Because it is easier to monitor something with which you are familiar, if you have a choice you should delegate those activities you know best…this will very likely go against your emotional grain
As Grove says here, the natural instinct is to hold on to the tasks you do best (and perhaps do better than anyone else), and delegate the rest. In fact though, there’s greater leverage in delegating tasks you can monitor well.
He introduces the concept of task-relevant maturity to decide how closely someone should be monitored. It’s not to do with how competent they are in general, but rather how experienced they are at the specific task. You might therefore check in with someone only monthly for a task they’ve established high competence at in the past, but monitor the same person weekly for something that’s new to them.
Low maturity: Structured, task-oriented, tell “what” “when” “how
Medium maturity: Individual-oriented; emphasis on two way communication, support, mutual reasoning
High maturity: Involvement by manager minimal, establishing objectives and monitoring
When does monitoring become meddling? Grove compares it with quality assurance principles: just as a factory only samples some of the items that come off the production line to get an insight into how the machine is performing, a manager should just randomly dive into some of the details to “spot check” that everything is as it should be.
A medium is nothing less than the medium through which managerial work is performed. That means we should not be fighting their very existence, but rather using the time spent in them as efficiently as possible
There are two main types of meeting: process-orientated and mission-orientated.
Process-orientated meetings are organised as part of a regular routine, and involve the sharing of information about how regular business is proceeding.
There are three types:
These take place between an employee and his manager. They’re used for the manager to pass on her experience and share suggestions for how things could be done, and also for her to gain an understanding of what’s happening and how it’s going.
If held weekly a single hour’s one-to-one can affect 40 hours of work, so it’s a high-leverage activity.
- The frequency of these meetings depend on task-relevant maturity of the subordinate, and the pace of change in the area.
- The subordinate owns the meeting and prepares the agenda.
- The agenda should cover KPIs, current problems, and potential problems – even if it’s currently just a hunch.
- One-on-ones should be scheduled on a rolling basis – setting up the next one as the meeting taking place ends. This avoids interruptions by vacation, illness or other commitments on the set date.
Staff meetings are held between a supervisor and all her subordinates, so there’s the opportunity for interaction between peers.
They allow the supervisor to learn from the discussion and any conflict that is involved. As Grove says, “I get a much better understanding of an issue with which I am not familiar by listening to two people with opposing views discuss it than I do by listening to one side only”.
- Anything that affects more than two of the people present should be discussed.
- The agenda should be defined in advance, but include an “open session” where anything can be brought up.
- The supervisor should lead, observe, question and decide – but not lecture.
These are used for employees to present work to managers who aren’t their immediate supervisors, as well as their peers elsewhere in the company. They’re used to keep teaching and learning happening across the company.
Mission-orientated meetings are held ad-hoc, and designed to product a specific output – usually a decision. If all is going well, you should never have to call a mission-orientated meeting because it’s all taken care of in regularly scheduled process meetings. At most, they should make up no more than 20%.
- The person who has the most stake in the outcome calls the meeting, an should clearly communicate the objective in advance.
- The chairman should arrange the logistics and circulate the agenda, then send out minutes afterwards. These should clearly say what is to be done, who is to do it, and by when.
- There should be no more than six or seven attendees, or it becomes hard for decisions to be made.
The output of a planning process isn’t a document – it’s the set of tasks it causes to be implemented to affect future events.
Today’s gap represents a failure of planning some time in the past. By analogy, forcing ourselves to concentrate on the decisions needed to fix today’s problem is like scurrying after our car has already run out of gas. Clearly we should have filled up earlier. To avoid such a fate, remember that as you plan you must answer the question: What do I have to do TODAY to solve – or better, avoid – TOMORROW’s problem.”
Management By Objectives (MBO)
MBO is a planning tool that is based around two questions:
- Where do I want to go? (The answer provides the objective)
- How will I pace myself to see if I am getting there? (The answer gives us milestones, or key results)
For example, you need to be at the airport to catch a flight in an hour: that’s the objective. The key results to make sure you’re on track are reaching Town A in 15 minutes, and Town B in 40 minutes.
- Objectives should be set for relatively short time periods: Grove suggests quarterly or monthly.
- The system should provide focus, which is only possible if the number of objectives is small.
- Objectives should be set high enough that even someone pushing himself hard should only have a 50-50 chance of achieving them. This produces a higher level of output by pushing everyone to the maximum.
Grove says there are only two reasons for poor performance:
- Someone can’t do it (they’re not capable)
- Someone won’t do it (they’re not motivated)
The test to establish which is: if someone’s life depended on doing the work, could he do it?
As these are the only two factors affecting output, the manager can only affect output through training and motivation.
For training to be effective, it has to maintain a reliable, consistent presence. Employees should be able to count on something systematic and scheduled, not a rescue effort summoned to solve the problem of the moment. In other words training should be a process, not an event.
Motivation has to come from within somebody. Accordingly, all a manager can do is create an environment in which motivated people can flourish.
- Reviews should be delivered by the manager, not a list of achievements prepared by the subordinate for rubber-stamping: “If you have to tell your supervisor about your accomplishments, he obviously doesn’t pay much attention to what you are doing”.
- You should deliver the review in written form in advance, then meet to discuss it. This allows them to get over the initial emotion and be in a position to receive the real message by the time you meet.
- You should spend adequate time reviewing the performance of your stars: even someone with stellar performance can improve. Star players greatly affects the output of the group, so it’s a high-leverage activity.
- If the recipient’s verbal and nonverbal responses do not completely assure you that what you’ve said has got through, it’s your responsibility to keep at it until you’re satisfied that you’ve been heard and understood.