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Management by Objectives, quotas, incentive pay, business plans, put together separately, division by division, cause further loss, unknown and unknowable. The forces of destruction begin with toddlers — a prize for the best Halloween costume, grades in school, gold stars — and on up through the university.
Management by Objective, incentive pay, business plans cause further loss, unknown and unknowable. The destruction continues on up through universities and into work, where people are ranked. Rewards for the one at the top, punishment for one at the bottom. Learned from Dr. Deming; school and work are the same institution.
Management by objectives, quotas, incentive pay, business plans, put together separately, division by division, cause further loss, unknown and unknowable. The forces of destruction begin with toddlers — a prize for the best Halloween costume, grades in school, gold stars — and on up through the university.
Deming insisted that companies, "Eliminate management by objective." Sears' Chairman at the time, Ed Brennan, acknowledged that the stretch goal gave employees a powerful incentive to deceive customers. In my opinion, there can be no such debate over the lack of usefulness of stretch goals. Here's why.
It provides control over sales incentive spending around the world, and it simplifies plan management and administration.” ” Others argue that a single global incentive plan per sales role doesn’t work: “Sales is a local function. Diversity makes a global sales incentive plan impractical and dangerous.”
And he believed that managers wrongly apply incentive pay plans, forced rankings, and all sorts of carrots and sticks to create the illusion of control without solving root performance problems. Many management thinkers have built upon Deming’s philosophy, yet his core message seems lost to time.
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