High Output Management Book Summary: Best Business Management Book

by Accessory To Success August 07, 2021

High Output Management Book Summary: Best Business Management Book

Must Read Business Management Book 

A manager’s output is not individual work but rather the output of the people supervised or influenced. With a focus on middle managers, measuring a manager’s success should be based on how much and the quality of the supervised and influenced team outputs, requiring a process that ensures each team member has the resources needed to succeed. A middle manager is defined as anyone, not just designated managers, in the organization who oversees a team or influences others through knowledge and expertise. Motivating and teaching are the high-leverage manager activities that generate high team output because these two actions help individuals attain peak performance.

Learn To Build A Business Management System

  • How to plan today to get the desired output in the future
  • Middle managers and organizational people with influence are important sources of ideas, knowledge and skills
  • The output-oriented approach to management
  • Managerial leverage measures the impact of what managers do to increase team output
  • How to maintain the individual competitive advantage
  • Importance of training employees according to their needs and not expecting them to figure things out on their own
  • Need for measurements of physical outputs paired with quality metrics
  • Formula for a manager’s true output
  • Formula for linking managerial output to managerial activity
  • Conducting effective performance reviews
  • Strategies for increasing managerial productivity through team members
  • A list of steps a manager can take to ensure time is spent on the most important tasks which are the ones that increase organizational performance in the final analysis
  • A decision-making process that leads to value-adding outputs
  • A delegation process that matches the task-relevant maturity of team members

High Output Management Book Summary

In the introduction to High Output Management, Andrew Grove presents the motto he advocates for managers. He writes, “Let chaos reign, then rein in chaos.” This motto reflects the dynamic business environment that existed then and now and the role of managers in finding order in the chaos. His advice is focused on middle managers – the people who are designated managers and those who are influencers through knowledge and expertise within an organization.

Middle managers are frequently overlooked as a source of new ideas and outputs that help the organization succeed. This point is reaffirmed in many of the best books including one about the growth of Pixar Creativity Inc.

 

Grove tells readers they cannot wait for instructions or orders from the top if they want to improve their own productivity and the performance of their team. The overriding theme is that everyone in the organization produces, and the manager’s output is determined by the output of the organizational unit under his or her influence. To increase output of the teams,managers must learn how to use managerial leverage to get peak performance from each team individual so the team itself achieves high performance. This is something also written about in the book likeThe Messy Middle &Extreme Ownership

 

Grove’s leadership principles discussed throughout the book makes a reader recall Gestalt theory which psychologist Wolfgang Kohler summarized as, “The whole is different than the sum of its parts.” According to Grove, a team will only perform well when each member performs well. The author foresaw the importance of a company having fewer levels of managers without giving up the basic tenet ofIntel’s managerial philosophy of one-on-one meetings between supervisor and each employee.  Managers can only succeed in the business environment that is transforming due to globalization and technology by trying out new ideas, techniques and technologies with the end goal of increasing the value of outputs. More on this is the book theInnovator’s Dilemma.

 

The author also first understood the importance of the casual workplace environment that tech companies are now noted for.Intel employees dressed informally, had partitions instead of offices, and even Grove himself had a cubicle office. Why? It was to encourageknowledge-power people to mix with position-power people on a daily basis. For more on this you might read about Jack Ma in the bookAlibaba.

 

Grove also emphasizes the importance of training employees who are immature in their ability to complete tasks and delegating to employees who are more mature. Not training employees who need training is a surefire way to ensure employees and the team fail to meet goals. 

 

It is not surprising that Grove uses the basic production process as the guide for developing management output principles and processes. He introduces concepts likethe limiting step and value-adding which influence all other steps and their sequence.Developing effective measurements (KPIs) is crucial, and they shouldmeasure the output and not just activity and be paired with an indicator thatmeasures quality. Chet Holmes was a huge advocate for measuring in this way. He discusses his method in great detail in his book The Ultimate Sales Machine.

 

In employment, for example, you measure the number of people hired by type of hire, and pair the physical measurement with a quality metric like the number of quality hires. Some of the additional output principles presented includekeeping track of leading indicators and trend indicators; controlling outputs through parallel flows of manufacturing and sales to satisfy customers;getting quality at the lowest price; and changing the nature of work to improve productivity (rather than just doing an activity faster). 

 

What are the outputs of managers? That is a key question addressed in this book. There is a propensity to measure activities, rather than outputs. Activity measures include things like allocation of resources and personnel trained.Better measures are the manager’s output which equals the output of his organization plus the output of any organizations he influences. This is something that must be a big part of the process according to the bookGood To Great.

 

A manager’s output is not her own work; it is the results achieved by a group, either under her supervision or her influence. As a CEO, Grove believed his managerial activities included supervision of direct reports and influencing groups not under direct supervision, but his output should be measured based on what the organization as a whole achieves. 

 

To increase output, the manager must always move to a point where leverage is the greatest. It is also crucial to collect information from all sources, including team members, because decision-making is governed by the base of information developed.Every managerial activity performed should increase organizational output. One book,Team of Teams, goes so far as to say that daily internal meetings are important to share timely information.

 

One of the pieces of advice given is that managers should spend time in advance of project planning activities to avoid ambiguity over time. The author then spends time discussing managerial decision-making and performance evaluation processes.Too much management time is spent on activities that do not produce value. The author’s focus is on managers and team members becoming collaborators increating value-added outputs. Something Scott Belsky is a huge advocate of and discussed in great detail in his bookThe Messy Middle.

 

For example, Grove says the manager shouldidentify pending decisions but structure the decision-making process for employees. Managers need to ensure they meet one-on-one with each subordinate to define a project, so the team member can define the three most important personal objectives. The manager identifies the task-relevant maturity of each subordinate toevaluate the person’s preferred management style and how it matches the manager’s actual style. Everything is done to maximize team, and thus organizational, output. A legendary book on organizational output isThe E-Myth Revisited

 

As the book’s inside flap says, the advice applies to anyone who is responsible for getting a group of people to produce value – business managers, salespeople, teachers, etc. It could be arguedthe book’s real value today is that it explains what type of leadership it takes to develop and sustain innovation.Certainly, it takes more than managers who spend their days performing activities that do not advance team performance. 

 

Many companies are challenged with developing a culture of sustainable innovation, and Grover clearly presents the case that it is the management style that is the key driver of organizational success. Something that you can read much more about in the bookSticky Branding. The style must be matched to each employee on the team, making the case that middle managers are the real drivers of business success or failure. This is one of the major reasons his advice resonates to this day among corporate managers. In a business environment that continuously changes, ensuring people have the right information and access to the right production process is the manager’s ultimate role.

Quotes From The Book

 

“Middle managers are the muscle and bone of every sizable organization, no matter how loose or “flattened” the hierarch, but they are largely ignored despite their immense importance to our society and economy.” (page xiii)

 

“A common rule we should always try to heed is to detect and fix any problem in a production process at the lowest value stage possible. Thus, we should find and reject the rotten egg as it’s being delivered from our supplier rather than permitting the customer to find it.” (page 13)

 

“Thus, the definition of “manager” should be broadened: individual contributors who gather and disseminate know-how and information should also be seen as middle managers, because they exert great power within the organization.” (page 40)

 

“…for every activity a manager performs - A1, A2, and so on - the output of the organization should increase by some degree.” (page 54)

About The Author Andrew S. Grove


Andrew S. Grove was born in Budapest, Hungary, in 1936 as András István Gró. His family was Jewish and survived the Nazi and communist regimes in Hungary, but in 1956 fled the Hungarian Revolution. They eventually made it to the United States. Grove attended the City College of New York, and in 1960 earned a B.S. degree in chemical engineering. In 1963, he received a Ph.D. in chemical engineering from the University of California, Berkeley.


Grove went to work as a researcher at Fairchild Semiconductor corporation where he first met Gordon E. Moore. Grove worked as assistant head of research and development under Moore.Moore and Robert Noyce founded the Intel Corporation, and Grove was their first hire. Intel is the company that developed the world’s first microprocessor in 1971, and by 1978, the latest version became a component in IBM’s first personal computer. 


In 1979, Andrew S. Grove became Intel’s President, and then in 1987 was appointed to the position of CEO. Intel controlled 85 percent of the world’s PC chip market by 1997, and it was Grove who is credited with Intel’s enormous success. He is also recognized as the man who was instrumental in ushering in the PC era.Grove was Chairman of the Intel Board of Directors from 1997 to 2005. He retired in 2005 and passed away in 2016. Amid all his responsibilities over the years, Grove also taught for 24 years at the Stanford University Graduate School of Business and was frequently invited to speak at various functions and businesses. He was also arecognized philanthropist and public advocate for issues very personal to him, like prostate cancer and Parkinson’s research.


During his time at Intel and then while in retirement, Grove authored several best-selling books and articles that shared is management philosophy. He was unique in many ways.He followed an egalitarian philosophy of “constructive confrontation” in which employees at all levels of the organization could propose ideas if they could manage vigorous examination. Grove combined scientific analytical thinking with authentic conversations which led to Intel’s innovations. Though an executive, he eschewed the typical trappings of authority, and his office was said to be a simple cubicle. 


His books on leadership includeHigh Output Management (original hardcover 1983) andOnly the Paranoid Survive (1996). He was named as Time magazine’s Man of the Year in 1997.  Andrew Grove’s influence on management philosophy is still widely felt today.
Accessory To Success
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