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High Output Management

Tips from the former chairman and CEO of Intel

By Andrew S. Grove
  • Read in 15 minutes
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  • Contains 9 key ideas
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High Output Management by Andrew S. Grove

High Output Management (1995) is a guide to the most important skill for any entrepreneur: managing a business. These blinks explain how a leader can encourage employees to deliver their best performance.

Key idea 1 of 9

Managing a company is like serving breakfast – it requires a sound understanding of production processes.

It might seem an odd idea, but working as a waiter will perfectly prepare you to manage the production processes of a company.

How come?

Well, managing production processes is actually just like serving breakfast. For instance, if your job is to deliver a three-minute boiled egg, toast and coffee, you’re already facing the essential requirements of production. You need to respond to demand by delivering your product according to a given schedule while meeting expectations for quality and keeping down costs.

To succeed at this complicated series of tasks you need to keep the first question of production in mind: which step is the hardest to complete?

When it comes to serving breakfast, it’s definitely boiling the egg as it takes the longest time. All the remaining steps should be planned around the time needed to accomplish this task.

Then, once you’ve identified the priority step in production, it’s your job as a manager to find the most cost-effective way to use the resources at your disposal.

Imagine a waiter has to stand in line every morning to use the toaster while his customer waits for her breakfast. How can he resolve the problem? His options are to ask a coworker for help, prepare toast in advance or buy another toaster.

Essentially, managers are there to identify and solve these kinds of bottlenecks, and their solutions include hiring a larger workforce, increasing inventory or buying more equipment. But remember, all of these choices cost money, and the task of a manager is to balance them in the most cost-effective way.

But that’s not all; managers also need to detect problems. That’s because problems arise all the time in production; to control damage, it’s essential to find and fix them as early as possible.

For example, if the kitchen ends up with a bunch of rotten eggs, it’d be better to find that out when they’re in the fridge and before they’re being boiled or tipped onto a customer’s plate. This means it’s essential for managers to monitor carefully all production processes.

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