September 18, 2017

10 - 15 - 20 - 25 Activities and Skills for Success as Manager at All Levels

4P Model of Management

I developed 4P Model of Management. Managers have to undertake Four major activities.

Providing Value  - They have to identify opportunities to add value to potential consumers, communicate value to them and exchange value with them.

Purchase Inputs - Managers have to purchase inputs to provide value.

Process Inputs and Convert them into Valuable Outputs

People Relations - Business is for People, Business is by People and Business is with People

The 4Ps fall into Business Skills, Process Skills and People Skills.

Detailed article

You can see how various authors only prescribe these skills in their articles.

Peter Economy - 10 things that super successful leaders do.

It was published in the Corporate Dossier of Economic Times (22 May 2015). Peter Economy was the author.

The 10 things listed were:

1. Acknowledge
2. Motivate
3. Be Decisive
4. Communicate
5. Trust
6. Be Confident
7. Develop
8. Direct
9. Partner
10. Be Honest and Transparent.

Jack Zenger and Joseph Folkman wrote in article in HBR Blogs.

The Skills Leaders Need at Every Level

The list given by them

Inspires and Motivates others
Displays High Integrity and Honesty
Solves Problems and Analyzes Issues
Drives for Results
Communicates Powerfully and Prolifically
Collaborates and Promotes and Teamwork
Builds Relationships
Displays Professional or Technical Expertise
Develops Others
Takes Initiative
Champions Change
Connects the Group to the Outside World
Establishes Stretch Goals
Practices Self Development.

Updated 19 September 2017, 21 May 2015

4 Ps of Management - 4 Essential Tasks in Business Management - Production or Service Businesses

Provide value - Procure inputs - Process inputs (Produce outputs) - People focus

Providing Value to Customers
Purchasing or Procuring Input Resources
Processing the Inputs into Outputs
People Relations

Every business manager has to do these four essential tasks. 
Every MBA must learn these four tasks.

They are classified by some management scholars as conceptual skills (business conceptual skills), technical skills (process skills) and people skills.

This blog,"Management Theory Review" provides you knowledge in all the essential activities through subjects - Principles of Management,  Marketing Management,  Supply Chain Management, Operations Management, Industrial Engineering and Organizational Behavior.

In the blog, chapter summaries of chapters from world famous textbooks are provided. Additionally, important developments and articles of each subject are provided as subject updates of the year.  Readers comments are invited as suggestion, feedback, questions etc. for improving the content to make it more useful to the readers to utilize the ideas in practice and increase production and profits for the organization and the society. Management as a profession must increase pleasure of the society and reduce pain of the society. Management as a profession has social purpose. But we need to fulfill organizational purpose and purposes of individuals working for the organization to fulfill the social purpose.

Business is done by people, Business is done for the people , Business is done with the people.
People dimension is important for business.

But there is no business if someone cannot find a business opportunity. Marketing is important. Providing value to people is marketing and sales.

If unfulfilled demand for a category is found, there have to be sources of inputs and a process to convert inputs into useful products. Supply chain and  production process are important.

2Ps  of Industrial engineering - Productivity and Profits

Industrial engineering is profit engineering. Industrial engineers analyze systems and make them more productive and profitable. Industrial engineering is concerned with 2Ps - Productivity and Profits

An effective and efficient business organization or an industrial organization is created by managers or entrepreneur managers using multiple skills.   Acquire the knowledge, use the procedures under guidance for some time and become proficient in them. Have a successful managerial career.

Principles of Industrial Engineering



Download full Paper -

Updated 19 September 2017, 17 May 2015

September 11, 2017

Lean Management - Management for Value and Productivity Enhancement

Lean Management for Productivity Enhancement
Presentation at Tata Steel
Dr. K.V.S.S. Narayana Rao, Professor , NITIE, Mumbai
Industrial Engineering Knowledge Center



Lean Management

Lean management gives importance to both effectiveness and efficiency.

Lean Managers simultaneously take care of customer satisfaction and productivity/ cost reduction responsibilities.

Hence lean management leads to more productivity in the organization.

It is appropriate that NPC came out with the theme “Lean Management for Productivity Enhancement”

"The core idea of the lean management system is to maximize customer value while minimizing waste." (7.3.2014)


Management is achieving objectives prescribed by owners/superiors, set by the manager himself and set in collaboration with the team members, together with the team with the resources provided to the team or acquired by the manager/team.

Soldier and Commander
Commander is a manager.
He may be a very good soldier himself.
Management is a lot more than being an expert doer.
But managers require the technical skills of a function they are managing.

Management Process

Resourcing (Acquiring various resources including human resources known as staffing)
Directing (Executing describes the management steps at this stage better)

Effectiveness and Efficiency

Managers have to be effective and efficient.
Effectiveness is achievement of objectives.
Efficiency is effectiveness combined with minimum consumption of resources.

No effectiveness - no efficiency.
Effectiveness first, efficiency next.

Scientific Management

F.W. Taylor advocated scientific management that highlighted the importance of efficiency in production shops.
Development of science of using machines and men in productive work is the theme of his management thought – scientific management
Taylor was responsible for development of industrial engineering discipline.

Principles of Management – Fayol

Management as a subject to be taught was advocated by Henri Fayol.
He gave 14 principles of management and explained management process.
He appreciated Taylor’s thought and advocated its wide adoption.

Principles of Management – Koontz

Koontz extended the 14 principles of management to around 30 and  embedded them in the five functions.
He stressed importance of effectiveness and efficiency in his first chapter. Also included some principles of efficiency in his list.

Koontz – Definition of Management
Management is the process of designing and maintaining an environment in which individuals, working together in groups, efficiently accomplish selected aims.

Koontz on Productivity
In a real sense, this book (Management) is about the improvement of productivity.
But  still, efficiency got neglected on a holistic basis in his book.
Industrial engineering is not mentioned in the book

Effectiveness and Efficiency as opposing ideas – An Error in Management Thought

Certain management authors positioned effectiveness and efficiency as opposing concepts.
They created tables showing differences between them.
Managers became isolated from the efficiency dimension.

Lean Management

Lean management philosophy brings efficiency back into the management discipline as a major component.
Managers must also have efficiency/productivity improvement skills
The Toyota Motors’ managers are to be given credit for this development.

Developments in Japan

Japanese executives captured the spirit of scientific management and industrial engineering almost from its birth in USA.
Industrial engineering was given a Buddhist religious dimension in the slogan-
Eliminate muda, mura, muri

Kiichiro Toyoda – Toyota Motors Founder
Kiichiro Toyoda was sure of the quality of his car.
But he was worried about its price.
He said unless its cost was reduced and price was reduced Toyota motors will not survive.

Effectiveness is there but Efficiency is the need.
So according to Kiichiro Toyoda, effectiveness was there.
Japanese customer is happy with the car.
But efficiency is not there.
Cost of production is high and hence price is high.

Manager’s Focus on Productivity/Efficiency
Therefore Kiichiro Toyoda’s focus shifted to productivity.
More and more managers were asked to focus on productivity.
Productivity in other words is cost reduction

Taichi Ohno
Taichi Ohno is a production manager.
Started concentrating on cost reduction.
Used Industrial Engineering.
Toyota Style Industrial Engineering.

Industrial Engineering

Industrial engineering is reducing cost of a product and increasing profit by increasing sales due to low prices.
Industrial engineering is profit making engineering (Ohno).
The other engineering is market-establishing and fulfilling engineering.

Industrial Engineering –  Definition or Explanation by Narayana Rao K.V.S.S. 

Industrial Engineering is Human Effort Engineering and System Efficiency Engineering.

JIT Systems - Lean Management

Kiichiro Toyoda looked around his production-distribution system for eliminating muda (excess resources).
Inventory seemed to him an excess resource.

He told his managers, that they have to think of JIT systems or low inventory systems.
Thus Kiichiro Toyoda is the man who first advocated JIT.

Taichi Ohno – JIT, IE and Productivity Activities

Reduce inventory – Create flow production.
Increase worker productivity
Use more automatic machines
 Make a worker attend more machines.
Make machines intelligent. No defective unit production

The change must be good.
The change must be profitable.
Do proper economic analysis.
Importance of Engineering Economic Analysis.
Low “lot size” inventory requires lower setup times.
Reduce setup times.

Shigeo Shingo, now a famous industrial engineer, helped Ohno.
Setup times for big presses were reduced to 3 minutes from earlier 2 to 4 or even 8 hours.

Low Safety Stocks
Systems have to be reliable and production should not result in defective parts.
Involve people in process quality improvement - TQM
Machines should not breakdown.
Improve maintenance and involve production workers also in machine upkeep

Emphasize on high availability of machines for production.
Do preventive and planned maintenance.
Condition monitoring employed for planned maintenance.
Maintenance for high available production time.
Total productive maintenance.

Low Inventory
Only a day’s inventory as buffer
Between components and assembly section only a days maximum consumption of each item is kept (as an illustration).
Components are made in small batches as per the use on that day.
Communication by Kanban.
Low inventory systems are lean systems

What is a lean system?

A system that satisfies customer requirements with a very low level of inventory.
It is a system that uses less resources than mass production systems based on traditional inventory principles.
Hence lean systems produce products at lower costs vs. high inventory systems.

Lean Manager

Lean managers use all management principles and techniques along with all the industrial engineering tools and also tools specially developed in Toyota Production System and its further development as Lean Enterprise System (Womack and Jones, The Machine that changed the World)

Is Lean Applicable to Steel Plants?
Tata Steel is itself following some lean practices.
Its managers are talking of lean at least since 2001. May be lean movement started some time before.

Recent Publications
2003 Phd thesis on application of lean in a steel plant.
Lean supply chain practices in steel plants
Value stream mapping and reduction of production lead time in steel plants.
Optimizing inplant supply chain(PPC) using Lean.

Traditional Industrial Engineering Tools Applied in Lean Systems

Value engineering
Process and Operation Analysis (Method Study )
Standardization of Processes and Working Conditions
Motion Study and Principles of Motion Economy (5S)
Standardization of the Process
Time Study and Time Standards

Optimization and Operations Research
Statistical Methods to Control Variation
Engineering Economics

A Different IE Tool Classification
Product Design Efficiency Engineering
Process Efficiency. Engg.
Human Effort Eff. Engg.
Efficiency Engg. Of Various Resources

Process Efficiency Engineering - Classification
Technical Processes
Business Processes
Managerial Processes

New Ideas and Tools in Lean Systems

Just in Time Production - Change in Inventory Control Practices
Just in Time Supply
Kanban Communication System - Change in Production Planning and Control Procedure
Special Focus on Seven Wastes
Zero Defect Movement

Total Quality Control (Inspection by production persons only - no additional inspector) Total Productive Maintenance (Involving production operators significantly in preventive maintenance) Aggressive Kaizen (Team leaders responsible for monthly improvement in processes)

Visual Communication (Standard Work Sheets, Daily Targets and Production, and Problems)
Value Stream Mapping to identify and remove obstructions to flow
SMED (Application of methods study to setup time reduction)
U-shape layouts
Poka Yoke

Leveled production or production smoothing
Mixed model assembly or flexible production facilities
Supplier process improvement
Supply chain cost reduction led by Assembler.

Seven Waste Model – Waste and Elimination Principle or Technique
Waste of overproduction - One cannot produce without a production Kanban
Waste of time on hand (waiting)  - Multiple machines to an operator, all producing as per tact time.
Waste in transportation - Machines in line or flow placed close together

Waste of processing itself - Standardized Methods
Waste of stock on hand - JIT system
Waste of movement (of workers) - Machine layout changes
Waste of making defective products - Problem solving approach to produce zero defects. 5 Why’s?-Poka Yoke

Let us Hope

Hope Management Professors, Managers, Executives, Supervisors and Operators learn the new development in management – Lean Management.
High Customer Satisfaction and High Productivity  (No tradeoff).
Hope Industrial Engineers become Lean System IEs and Support Managers at all levels.

Thank You

Additional reading:

Toyota Production System - IE Point of View - Shigeo Shingo

Industrial Engineering - Foundation of Toyota Production System Chapter 1 to 3 of the book - Presentation
Toyota Production System Industrial Engineering - Shigeo Shingo Chapters 4 to 10
Introducing and Implementing the Toyota Production System - Shiego Shingo Chapter 11 of the book

Presentation was done on 14 February 2014 at Tata Steel, Jamshedpur, Steelenium Hall

A McKinsey Article - Next Frontiers for Lean - Feb 2014 - Ewan Duncan and Ron Ritter

The further development in lean has to provide more scientific insight into how product and service attributes contribute to customer value; what matters most for improving classic lean variables, such as lead time, cost, quality, responsiveness, flexibility, and reliability; and new opportunities for cross-functional problem solving to eliminate anything that strays from customer-defined value.

Principles of Industrial Engineering - Presented by Dr. K.V.S.S. Narayana Rao in the 2017 Annual Conference of IISE



Industrial Engineering Knowledge Revision Plan - One Year Plan

January - February - March - April - May - June

July - August - September - October - November - December

Updated 12 September 2017, 18 February 2014