THE WELCH COMPANY
440 Davis Court #1602
San Francisco, CA 94111-2496
415 781 5700







February 25, 1996                                                                    03 00069 96022403



Mr. Morris E. Jones
Sr. Vice President
Chips & Technologies, Inc
2950 Zanker Road
San Jose, CA  95134

Subject:  Project Management Institute (PMI)
                 Event Program Speakers - "Taking the Quantum Leap"
                 Executive Mindset

Ref:   a. Telecon Morris/Rod Feb 24, 1996
          b. Welch letter to Chips, Feb 24, 1996 [via internet]

Dear Morris,
Thanks very much for helping think through issues on Asilomar planning. Your experience and analysis are very valuable.

I apologize for any bad impression that may have resulted from submitting the notes of our discussion earlier today, and suggesting that you examine notes of a discussion with Tom Landauer. I certainly got the impression from our second call this evening that you were disappointed about these and/or other suggested actions to review the record. It is unclear whether such reaction was from presuming to impose further interaction on Asilomar in general, or from providing the text for review to support such efforts. In any case, it might be a helpful dimension of your talk at Asilomar to spell out the executive mind set that impacts management communications. See what you think.

Some months ago, possibly a year ago, I met with a Director of something (maybe "Controls" or MIS, since this guy was looking at computer tools and talked about CPM and Cost Control), who said he could never explain Communication Metrics to his boss who was a Vice President. I suggested he submit the SDS record that explains the ideas and methodology. The Director said the record has too much detail. He said executives are incapable of understanding detail. I suggested that many executives are interested in improving earnings and want to know about the details needed to do that. Many executives are former Directors, General Managers, and Managers of this that and the other. They know that if decisions about the big picture and the bottom line are not connected




Mr. Morris E. Jones                                               Page 2 of 4
Chips & Technologies, Inc
Subject:  Project Management Institute (PMI)
          Event Program Speakers - "Taking the Quantum Leap"
          Executive Mindset
up to the right details, then those decisions will fail. I explained my sense that executives are relying on staff to make these connections, and so seek summary information to save time. However, executives are finding more and more, during discovery from litigation, that essential connections are not being made because there isn't enough time. As the number of details continues to increase, the rate of error and consequent failure will likewise increase. This state of affairs provides a foundation to submit some detail to an executive via an SDS record on how to improve the ability of an organization to make the connections that produce the knowledge they need to succeed.

My reasoning did not succeed with this Director. He was afraid to submit the SDS record, and to permit me to explain the ideas to his Vice President. As you point out people have difficulty believing the SDS methodology can improve earnings, since their experience dealing with executives is that the kind of detail SDS is aimed at managing is antithetical to organizational culture. An important aspect of your presentation at Asilomar might be to discuss this cultural imperative in light of the changing environment of the New World Order, i.e., the Information Highway. We not only need a faster, better, cheaper way to make connections so that we can retrieve critical knowledge when it is needed, there is also a cultural change needed in the role of executives, described as a broader vision in the New World Order... paper. This may fit your view of the executive role to establish a vision.

David Vannier mentioned the other day that executives at Intel rely on the feelings they get about the level of confidence and sincerity of the speaker, because there isn't enough time to understand the content of what is actually said. This connotes people too busy to deal with details, but it also reflects a cultural schema of the "boss." People who struggle to become executives may well feel a sense of isolation once they achieve that goal, since others are aiming to please them or replace them. Measuring intentions becomes critical, and of course one aspect of this is judging sincerity and confidence. This may become a consuming exercise of Machiavellian proportion that eventually leads to rejection of substance in the need to maintain formalities of obeisance. Thus, the responsibilities and exegencies of exercising authority may change the orientation of the person. Details are no longer important. Intentions are critical and these are judged not from what is said but how it is delivered. These fundamentals of hierarchy are likely genetically imposed from eons of community life. Is there, however, a Malthusian end-game, described in the New World Order ... paper, that augurs for a mechanism to overcome executive hubris, in order to avoid the risk of management imploding on itself from a morass of errors?




Mr. Morris E. Jones                                               Page 3 of 4
Chips & Technologies, Inc
Subject:  Project Management Institute (PMI)
          Event Program Speakers - "Taking the Quantum Leap"
          Executive Mindset
Julias Caesar was reported to have instituted the practice of having an aide join him in the chariot while riding triumphantly into the square at the head of a victorious army. As the crowd hailed the returning conqueror with tumultuous aplause, the aide's job was to whisper in Caesar's ear that he was mere mortal, subject to error and should steel himself against hubris. History does not say how long these aides lasted. Was there a big turnover rate in the job? It must have been difficult to offer this reminder without causing offense, since offense is an emotion, and emotions vary from day to day. When everyone is doing our bidding, it seems pointless to inquire about details, eventually it may seem offensive to be asked to consider anything beyond the bottom line and the big picture. When we speak, as an executive, we expect that is enough to execute what is spoken, and if it is not, then we get others who are "can do" people, and who are smart enough to carry out our good ideas and directions. In this setting, an aide whose job is to remind Caesar that there may be error in what Caesar has spoken or that more consideration is required to accomplish desired objectives, suddenly seems a bothersome nitpicker, second-guessing and even misrepresenting clear understandings. One can imagine this job was filled from the ranks of the Christians, whose life span was already on short notice in Rome during that period.

Perhaps the fact that this practice did not survive the test of time, indicates less that Roman Emporers ran out of Christians, than that the model is not conducive to effective leadership. The US President does not have such an aide. The executive at the firm cited above did not have an aide. The military still seems to use this practice in modified form. A general will typically have a colonel accompany him as an aide, often taking notes during meetings. George Shultz and others have reported in books about the Reagan Administration that Reagan sought to enlist the service of General Vernon Walters to sit in on key meetings so he could later prepare notes solely from his recollection. The General was thought to have a special skill of being able to remember what was said without taking notes during the meeting, and Reagan wanted this because some people will not express themselves frankly if notes are being taken, yet the President needed to capture what was said in order to effectively apply it. General Walters rejected this assignment on the grounds that he did not want to be a Communications Manager, merely because he had the ability to do it and no one else did. Some attribute the Iran Contra fiasco to the fact that Reagan was never able to fill the role of capturing the record with a leadership aide.

In any case, there may be some material here that fits what you have in mind to explain the need for more analysis at the executive level, as a result of reducing the ranks of executives and mid-level tactical managers. Your idea




Mr. Morris E. Jones                                               Page 4 of 4
Chips & Technologies, Inc
Subject:  Project Management Institute (PMI)
          Event Program Speakers - "Taking the Quantum Leap"
          Executive Mindset
that executives need new skills and or support seems well founded. How, though do we deal with the cultural/psychological dimension, the resistance to change? How do we help people see the advantage of verification that in some respects may appear contrary to executive perspective? Does it require total failure of the system in order to convey the need for a metric to avoid failure from miscommunications and unsupported decisions? That may be an angle worth thinking about.

Sincerely,

THE WELCH COMPANY



Rod Welch