THE WELCH COMPANY
440 Davis Court #1602
San Francisco, CA 94111-2496
415 781 5700
rodwelch@pacbell.net


S U M M A R Y


DIARY: March 29, 1996 10:48 AM Friday; Rod Welch

Received Fortune magazine article on downsizing, skills deficit.

1...Summary/Objective
2...Cultural Expectation of Career Stability
3...Project Managers at Risk
......Impact of "Feel Good" management leading to recession, per
......Knowledge Worker
......Continual Learning
4...Trading People for Email Computer Networking and Collaboration
......Globalization of Work & Technological Change
......Who You Know, Not What You Know
......Who is Layed Off is Largely an Emotional Decision
5...Big Firms and Small Firms are Unproductive
6...Reengineering is Downsizing to Cut Cost, Not Improving Work Practice
7...Downsizing Will Continue
.....Management Imploding on Itself
.....Impact of "Feel Good" management leading to recession, per
.....Work Flow - Out of Loop
8...Skills Deficit
.....Added Value
.....Skills Outdated 3 - 5 years
.....Information, Knowledge Most Highly Prized
.....In any case, if it is highly prized, it would seem to be a strong


..............
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CONTACTS 

SUBJECTS
New World Order
Leadership is Imploding
Feel Good Management
Reengineering Downsizing Skills Deficit
Reengineer Project Management
Computers Replace Managers
Reengineer Fire People Streamline Downsize Remove Management Levels G

1109 -
1109 -    ..
1110 - Summary/Objective
1111 -
111101 - Follow up ref SDS 16 5002 and ref SDS 14 0000.
111102 -
111103 - The Forbes stories say downsizing is endemic to a changing economy,
111104 - but there is no analysis of the correlation between the quality of
111105 - management, reduced earnings, productivity, and job losses.
111106 - Discussions about "skills" say nothing about what skills are needed,
111107 - other than that new technical skills are coming along in
111108 - telecommunications.   The cover of a laid off project manager shows
111109 - this position is at risk per Morris' analysis at ref SDS 11 line 330.
111110 -
111111 -    [See follow up on skills in PMnetwork articles, ref SDS 19 line
111112 -    126.]
111113 -
111115 -  ..
1112 -
1113 -
1114 - Progress
1115 -
111501 - Received an article in the 960401 issue of Forbes magazine.  The
111502 - cover story is:
111504 -                       ..
111505 -                      How Safe is Your Job
111506 -
111507 -    ...it shows the picture of an AT&T project manager, laid off at 43.
111508 -    and following up story on CNN that 78K would be layed off, ref SDS
111509 -    10 line 43.
111511 -  ..
111512 - There are 3 or 4 major articles on downsizing beginning on p. 55 where
111513 - the first story indicates that job loss reflects natural market forces
111514 - of renewal, ref OF 3 line 12, ref OF 3 line 74.
111515 -
111516 -
111518 -  ..
111519 - Cultural Expectation of Career Stability
111520 -
111521 - An initial point is made using recent history of IBM that a cultural
111522 - expectation of remaining with the same company throughout a career is
111523 - explained with respect to IBM at ref OF 3 line 97.  IBM was an example
111524 - used at Asilomar in 1994 ref SDS 5 line 134.
111526 -  ..
111527 - The general case is made on the correlation between employment
111528 - volatility and accelerating changes from market forces, ref OF 3 line
111529 - 145.
111530 -
111531 -    [See follow up on skills in PMnetwork articles, ref SDS 19 line
111532 -    162.]
111533 -
111534 -
111536 -  ..
111537 - Project Managers at Risk
111538 -
111539 - The cover of Fortune is dominated by a picture of a Project Manager
111540 - who is laid off at 43.  The article says the quality and value added
111541 - of the project were not considerations in the rush to reduce the
111542 - payroll. ref OF 3 DD8I
111543 -
111544 -      This reflects the Raychem situation where two project managers
111545 -      were furloughed after completing a project that won PMI's Project
111546 -      of the Year award, reported on 960117. ref SDS 13 3002
111547 -
111549 -       ..
111550 -      Impact of "Feel Good" management leading to recession, per
111551 -      analysis at ref SDS 1 line 240.
111552 -
111553 -      Fortune's evaluation conflicts with PMNETwork's article in the
111554 -      April issue saying project managers are less prone to being
111555 -      downsized, ref SDS 19 line 263, ref SDS 19 line 251.
111557 -  ..
111558 - Fortune reports that "generalists" are more at risk than specialists,
111559 - ref OF 3 D243, which supports Morris' explanation on 960301 of
111560 - replacing project managers with team leaders and that managers are
111561 - unproductive overhead. ref SDS 17 4692  Fortune's analysis and report
111562 - supports Morris' explanation that project managers are no longer
111563 - needed, ref SDS 7 7409, per Mike Emery's forcast on 940824 that
111564 - Project Managers would lose corporate support because their skills are
111565 - becoming generalized, i.e., everyone can use CPM and Cost Control
111566 - tools. ref SDS 6 6901
111567 -
111569 -       ..
111570 -      Knowledge Worker
111571 -
111572 -      Fortune cites the "supremacy of the knowledge worker" who can
111573 -      "make a phone line work like a cable line" per ref OF 3 line 171,
111574 -      This is primarily the job of a craftsman.  Taking what is already
111575 -      known and impelmenting it, or re-casting its application, per
111576 -      discussion with Morris at ref SDS 17 line 126.
111577 -
111579 -       ..
111580 -      Continual Learning
111581 -
111582 -      Fortune identifies another aspect of "knowledge worker" as having
111583 -      needed information/knowledge at ref OF 3 line 370.
111585 -       ..
111586 -      This perspective of the "knowledge worker" posed from Peter
111587 -      Drucker's work, ref SDS 2 line 157, as creating new knowledge
111588 -      each day from new information, i.e., converts information into
111589 -      useful knowledge.  This is the sole function of management,
111590 -      reflected by the model of an executive who has good learning
111591 -      skills, ref SDS 4 line 174, and ISO criteria for "continual
111592 -      learning." ref SDS 8 line 501.
111593 -
111594 -
111596 -  ..
111597 - Trading People for Email Computer Networking and Collaboration
111598 -
111599 - The rationale that fewer people are needed because technology is doing
111600 - more so bureaucracies can be reduced, is described, ref OF 3 NQ5R,
111601 - supporting the "reengineering" theory described by Morris at Chips &
111602 - Technologies, ref SDS 7 7409, and supported by the article in Wired
111603 - magazine reviewed at ref SDS 9 line 195.
111605 -       ..
111606 -      The Wired article says managements believe the investment in
111607 -      personal computers makes managers more productive, so they can
111608 -      accomplish more or the same amount of "management" with fewer
111609 -      managers, ref SDS 9 line 195.
111610 -
111611 -
111613 -       ..
111614 -      [See support from discussion about Columbia Distributing
111615 -      ref SDS 18 line 98, and from meeting with General Hatch,
111616 -      ref SDS 20 line 623, and letter to PMI Comm. re Asilomar
111617 -      Conference and NWO article, on trading people for machines,
111618 -      ref SDS 21 line 176.]
111620 -       ..
111621 -      [Analysis of Communication Metrics increasing span of attention,
111622 -      supports potential for correct technology to improve management
111623 -      productivity, ref SDS 23 line 139.]
111625 -       ..
111626 -      Globalization of Work & Technological Change
111627 -
111628 -      Fortune cites the compression of time and distance where American
111629 -      workers are competing with global economies, creates pressure to
111630 -      use technology for reducing production costs, ref OF 3 line 169,
111631 -      ref OF 3 line 203, ref OF 3 line 273.
111633 -       ..
111634 -      It supports the Asilomar thesis, ref SDS 15 line 127.
111635 -
111636 -          [This perspective supports the Asilomar thesis, ref OF 10
111637 -          line 21, per ref SDS 15 line 127.
111639 -       ..
111640 -      One strategy is to reduce overhead under Morris' perspective that
111641 -      managers are unproductive "overhead." ref SDS 17 line 126.
111642 -
111644 -       ..
111645 -      Who You Know, Not What You Know
111646 -      Who is Layed Off is Largely an Emotional Decision
111647 -
111648 -      The Fortune articles say the decision is emotional ref OF 3 line
111649 -      742, to save the firm by reducing costs to be competitive with
111650 -      global economies, ref OF 3 line 129, ref OF 3 line 145, ref OF 3
111651 -      line 169, ref OF 3 line 273.
111653 -       ..
111654 -      Fortune says downsizing reflects need to increase shareholder
111655 -      value, ref OF 3 line 273, but that is simply a reflection of poor
111656 -      management because productivity is low, per Peter Drucker's
111657 -      formulation that "management is the only thing that makes
111658 -      resources productive." ref SDS 17 line 281.
111659 -
111660 -
111661 -
1117 -

SUBJECTS
Recission, Reengineering/Downsizing from
Reengineer = Fewer Managers + More
Management Reengineer/Improve Productivity,
Reengineering Where People Work, Who They
Economic Recission

1707 -
170801 -  ..
170802 - Big Firms and Small Firms are Unproductive
170803 -
170804 - The Fortune stories show the range of excuses for poor performance
170805 - that ushers in the quick fix of downsizing:
170806 -
170807 - One story says that big companies, ref OF 3 line 174, had to downsize
170808 - because they were being beaten in the marketplace by new, small,
170809 - nimble firms that used computers.
170811 -  ..
170812 - Another story says the small, nimble companies who use comptuters have
170813 - suffered the same fate as the large companies of having to downsize,
170814 - ref OF 3 line 238.
170815 -
170816 -     This suggests some constant between large and small companies
170817 -     that leads to poor performance.
170818 -     ..
170819 -     Peter Drucker says it is poor management, ref SDS 17 line
170820 -     289.
170821 -
170823 -  ..
170824 - Reengineering is Downsizing to Cut Cost, Not Improving Work Practice
170825 -
170826 - This point is made at ref OF 3 line 268, see also Pmnetwork article,
170827 - ref SDS 19 line 295.
170828 -
170829 -    Similar to Raychem being awarded Project of the Year, then cutting
170830 -    away its key project managers, ref SDS 12 line 80, under the excuse
170831 -    that computers improve productivity, ref SDS 19 line 290.
170833 -  ..
170834 - Examples are Chips where Morris has moved his office and changed the
170835 - people to whom he reports and who report to him, but he has not
170836 - changed the way he works.
170837 -
170838 -    [Morris confirmed this point at Asilomr in July, ref SDS 22 line
170839 -    501.]
170840 - ..
170841 - Don Harms at Transamerica said the other day that businesses
170842 - have to change.  All he has changed is the location of where he shows
170843 - up.  He has not changed the way he works so it is more valuable.
170845 -  ..
170846 - Question:
170847 -
170848 -       Should we reengineer by changing geography and the organization
170849 -       chart, or by improving the practice of management?
170850 -
170851 -
170853 -  ..
170854 - Downsizing Will Continue
170855 -
170856 - American Management Association reports 60% of respondents to a survey
170857 - of 1,000 organizations said further force reductions will occur over
170858 - the next year, the highest percentage ever reported in the survey's
170859 - history.  ref OF 3 line 275.
170861 -      ..
170862 -     Management Imploding on Itself
170863 -
170864 -     This statistic seems to support the reasoning in the NWO paper,
170865 -     ref OF 1 line 504.
170867 -  ..
170868 -
170869 -     Impact of "Feel Good" management leading to recession, per
170870 -     analysis at ref SDS 1 line 240.
170872 -      ..
170873 -     Work Flow - Out of Loop
170874 -
170875 -     If you are no longer invited to meetings and not getting calls
170876 -     from the boss, colleagues or customers, it is an indication you
170877 -     are a target for downsizing. ref OF 1 line 338
170878 -
170879 -
170880 -
170881 -
1709 -

SUBJECTS
Skills Deficit, Reengineer by Increasing
Money, Improving Earnings

1904 -
190501 -  ..
190502 - Skills Deficit
190503 -
190504 - The article says to hone job skills at ref OF 3 line 282, but it
190505 - appears the most important factor in keeping an existing job is
190506 - creating political allies among those making personnel decisions.
190508 -      ..
190509 -     Added Value
190510 -
190511 -     This is discussed at ref OF 1 line 322, as whether work being
190512 -     performed is linked to someone outside the firm?
190513 -
190514 -     Does the customer of your firm's service or product get anything
190515 -     useful because of what you do? ref OF 1 line 328
190517 -      ..
190518 -     Skills Outdated 3 - 5 years
190519 -
190520 -     This point is made at ref OF 3 line 346, but does not address how
190521 -     the skill of converting information into knowledge can become
190522 -     outdated.  This is the point of the Tofflers and ISO in the
190523 -     concept of "continual learning."
190525 -      ..
190526 -     Information, Knowledge Most Highly Prized
190527 -
190528 -     This is described as intellectual firepower at ref OF 3 line 369,
190529 -     but seems to reflect academic training a particular discipline, as
190530 -     opposed to the skill and capacity to acquire new knowledge.
190531 -
190533 -      ..
190534 -     In any case, if it is highly prized, it would seem to be a strong
190535 -     path to being highly rewarded.
190536 -
190537 -
190538 -
190539 -
190540 -
190541 -
190542 -
190543 -
190544 -
190545 -
1906 -