The idea of a merit rating is alluring. The sound of the words captivates the imagination: pay for what you get; get what you pay for; motivate people to do their best, for their own good.
The effect is exactly the opposite of what the words promise. Everyone propels himself forward, or tries to, for his own good, on his own life preserver. The organization is the loser.
The merit rating rewards people that conform to the system. It does not reward attempts to improve the system. Don’t rock the boat.
Motivation - nonsense. All that people need to know is why their work is important.
No one can measure the loss of business that may arise from a defective item that goes out to a customer.
The consumer is the most important point on the production-line.
I read them. Not to grade them. No, I read them to see how I am doing. Where am I failing? What don’t they understand? Why do they give wrong answers? Why do they have some point of view that I don’t think is right? Where am I failing? Where do I need to build up.
Our schools must preserve and nurture the yearning for learning that everyone is born with.
The merit rating nourishes short-term performance, annihilates long-term planning, builds fear, demolishes teamwork, [and] nourishes rivalry and politics. It leaves people bitter, crushed, bruised, battered, desolate, despondent, dejected, feeling inferior, some even depressed, unfit for work for weeks after receipt of rating, unable to comprehend why they are inferior. It is unfair, as it ascribes to the people in a group differences that may be caused totally by the system that they work in.
There are four prongs of quality and four ways to improve quality of product and service:
- Innovation in product and service
- Innovation in process
- Improvement of existing product and service
- Improvement of existing process
The common mistake is the supposition that quality is ensured by No. 4, improvement of process, that operations going off without blemish on the factory floor, in the bank, in the hotel will ensure quality. Good operations are essential, yet they do not ensure quality. Quality is made in the boardroom.
A bank that failed last week may have had excellent operations— speed at the tellers’ windows with few mistakes; few mistakes in bank statements; likewise in the calculation of interest and of penalties and loans. The cause of failure at the bank was bad management, not operations.