What's the So What? High Output Management by Andy Grove

High Output Management by Andy Grove

What's the So What in 100 words

The value of any manager is the combination of the output of her team and the output of her surrounding teams. This means the top priority for every manager is to get more output from her team and surrounding teams. In theory, spending every hour increasing the output or the value of the output of the people they're responsible for. Where a manager's own skills and expertise are only useful if she's using them to get more leverage and output from her teams. To do this, she needs to consider what holds back employees from high output. Which comes down to either a lack of will or a lack of skill. Therefore, all that managers can do to improve the output of their employees and teams is to motivate and train. That's it, to motivate and train. Rinse and repeat.

Why and when did I read High Output Management?

I read it in December 2014, probably because A16Z's Ben Horowitz tweeted about it; ever since Horowitz penned Good Product Manager/Bad Product Manager , I've been a big fan of his writing. And Horowitz is the world's biggest fan of Intel Co-Founder/later CEO (and Time Magazine's 1997 Person of the Year !) Andy Grove generally and High Output Management specifically. I'd already read Grove's Only the Paranoid Survive back in 2006 and did NOT like it - a contrarian take to use Silicon Valley speak - so I went in with lowered expectations. Suffice to say, they were massively exceeded. Even more so because High Output Management was first published in 1983 - before the personal computer reached scale, let alone email, the internet, and the rest of today's tech world - yet the concepts are timeless.

While High Output Management isn't on my true business book Mount Rushmore - that's reserved for Conscious Business by Fred Kofman , Confessions of an Advertising Man by David Ogilvy, and "The Innovator's Solution " by Clay Christensen - it's on the next rung down of incredible books that I regularly recommend to others.

Ten So Whats that stuck with me

1. A Manager's value is measured by their team's output + neighboring teams' output. Work is done by teams. And the value of any team is measured by its output. Therefore if a Manager is deeply knowledgeable and produces a lot of output herself, but her team's output is sub-par, she's not doing her main job of maximizing output from her team and surrounding teams. The book digs into details around systems design and production - talking inputs & outputs, quality control testing, and more - but the crux is crystal clear that maximizing team output is a manager's primary responsibility.

2. Therefore, a manager's #1 priority is getting more leverage from her people. Leverage is the output generated by a specific type of activity, so managers need to spend as much time as possible on the highest leverage, highest output-producing activities. Where specifically, the three activities that managers spend time on to drive leverage are 1) gathering information, 2) "nudging" others (e.g., asking a question or making a comment), and 3) making decisions (by far the least frequent part of the role).

3. Access to information is the foundation of all management activities. Grove spent the majority of his day in information-gathering mode because it's the basis of management activities. In Grove-speak: "conveying information, making decisions, and being a role model for your subordinate are all governed by the base of information that you, the manager, have about the tasks, the issues, the needs, and the problems facing your organization." This emphasis on information-gathering reminds me of one of longtime LinkedIn CEO Jeff Weiner 's super-powers, his ability to digest troves of information and turn it all into insights and action.

4. If somebody isn't doing their job well, they either lack will or skill: therefore managers need to motivate and train, period. Grove has a simple test for whether the gap is will or skill: "if the person's life depended on doing the work, could she do it?" It's such a simple question to ask ourselves - "Is the challenge will or skill?" - anytime anybody is struggling (including ourselves). Here's a graphical way to visualize it:

5. We can get more output by Speeding up, Levering Up, or Mix Shifting Up. Using an engineering and production mindset, we can increase output in 3 ways:

1. Speed up: Do existing activities faster
2. Lever up: Increase the leverage of existing activities
3. Mix shift up: Increase the mix from lower to higher leverage activities

As managers, we can also, unfortunately, exert negative leverage: e.g., being a key participant at a meeting and showing up late or unprepared, or micro-managing to the point that employees begin to take a more restricted view of what's expected of them.

6. Planning is critical to managing... When we experience problems, we often figure out how to solve the current gap vs expectations to keep progressing. This is good but connects to my favourite quote from the book, "Today’s gap represents a failure of planning sometime in the past.” And the follow-up question to constantly ask ourselves, "What do I have to do today to solve - or better, avoid - tomorrow's problem?"

7. ... Because planning helps us solve problems earlier, which is cheaper. Drawing upon his experience producing memory and microchips, Grove shares, "All production flows have a basic characteristic: the material becomes more valuable as it moves through the process." And it's far cheaper and better to detect and fix any problem in a production process at the lowest-value stage possible. For example, validating that a product will drive customer demand - or not - before spending months or even years building it. And performing regular post-mortems on issues to ensure we're fixing the underlying causes, so they don't repeat.

8. The best way to delegate and manage depends on the employee's task-relevant maturity. First, delegation does not mean abdication; it's still the manager's ultimate responsibility for the deliverable. Second, let's delegate what we know best - which sounds counterintuitive - because it takes less time to jump in since we have a better sense of what good looks like. Third, let's fix things when they're small (see #7), e.g., reviewing an early outline of an exec presentation vs waiting for the final form. And fourth, let's monitor more closely when employees have less experience with a specific task. Each of us is not a "hands-on" or "hands-off" manager;" instead, we adjust based upon the individual's task-specific abilities. We flex up or down our degree of oversight depending on the task-relevant maturity of the individual or team as follows:

9. The goal of performance reviews is to improve performance. Although we may also assess performance and calibrate, the foundational goal of a review is to raise the employee's performance. Returning to the idea of will & skill, performance reviews are extremely high leverage IF, afterwards, the employee is 1) more motivated for the next several months, and 2) more clearly knows what skills are lacking at the current level or to get to the next level, along with a plan to invest and improve on these into the future.

10. Finally, we can return to "Will & Skill" as we make hiring decisions. We can tailor interview and reference questions to get confidence across 4 aspects for each potential hire. That she:

1. Has the skills the job needs (skill)
2. Has turned these skills into prior performance (will & skill)
3. Can identify discrepancies between what she knows and what she did (will & skill alignment)
4. Has a set of guiding operational values that would be a good match (will & skill fit at your company)

Quotables

"A manager's output = the output of his organization + the output of the neighboring organizations under his influence. Why? Because business and education and even surgery represent work done by teams."

"In principle, every hour of your day should be spent increasing the output or the value of the output of the people whom you’re responsible for."

"When a person is not doing his job, there can only be two reasons for it. The person either can’t do it or won’t do it; he is either not capable or not motivated ... All you can do to improve the output of an employee is motivate and train. There is nothing else."

"I have seen far too many people who upon recognizing today’s gap try very hard to determine what decision has to be made to close it. But today’s gap represents a failure of planning sometime in the past ... [So ask yourself] What do I have to do today to solve - or better, avoid - tomorrow’s problem?

"Values and behavioral norms are simply not transmitted easily by talk or memo, but are conveyed very effectively by doing and doing visibly."

"CEOs always act on leading indicators of good news, but only act on lagging indicators of bad news. In order to build anything great, you have to be an optimist, because by definition you are trying to do something that most people would consider impossible. Optimists most certainly do not listen to leading indicators of bad news.”

So what do I think or do differently today?

Honestly, I read this during a phase when I read a lot but didn't take much time to reflect and act because I'd (too) quickly move on to the next book. Therefore here's a blend of what I've done differently and what I aspire to do differently after a recent 2021 re-read:

1. Return often to the simplicity of the Will & Skill framework: starting with myself, when I'm struggling to accomplish something, ask whether it's because I don't know how or because I'm simply not trying hard enough. And then ask the same question - "Is the challenge will or skill?" whenever I'm working with anybody who's struggling with a task, so I can adjust how to best jump in to help.
2. Explicitly consider the cost of meetings as though I'm expensing their cost: I think long-and-hard about expensing an item for $500, but regularly join meetings that cost 10X or even 100X this. I wrote a long time ago about "Running Late: Disorganized or Disrespectful ", so I'm pretty good (not perfect!) on the punctuality part, but I'm certainly guilty sometimes of the dreaded "So what do we want to dig into today, team?" meeting opener ;) I'd love for Microsoft Outlook - hello, parent company! - to overlay the cost of each meeting as part of Calendar view, the number/seniority of people would be an easy proxy. Then we could more easily a) ensure we're prepared for the most expensive (important) meetings, and b) reflect at the end of the week/month on whether these high-value meetings were, in fact, high-value meetings.
3. Completely ignore Grove's advice that self-reviews are not helpful: it's always fun to vehemently disagree with probably the tech industry's best manager EVER, but vehemently disagree I do :) He argues self-reviews aren't valuable because they take the responsibility off the Manager to synthesize what their subordinate is doing. I've always subscribed to the school of thought that 80% of the value of a self-review - and really any written document - is for the writer to drive to clarity. Then the manager's review should have limited overlap with the employee's self-review: ideally, it adds peer feedback snippets and is more forward-facing, outlining proposed development areas.

Want to go deeper with the ideas from this book and others?

• To dig in further,?I'd highly recommend reading the full book since my So Whats above miss entire concepts about running effective meetings, structuring teams & orgs, OKRs, decision-making frameworks, and more. For more synthesis, Ben Horowitz 's excellent Foreword to the book's most recent edition is here , and two helpful summaries are here from Ian Tien and here from Abi Noda .
• Coming soon?WTSWs: Never Split the Difference by Chris Voss + Can't Hurt Me by David Goggins. I may then branch beyond business books to the physical health trio of Breath + Why We Sleep + Exercised , we'll see!
• Recent WTSWs: The Making of a Manager by Julie Zhuo +?Radical Candor ?by Kim Scott +?Atomic Habits ?by James Clear +?The Pyramid Principle ?by Barbara Minto +?Think Again ?by Adam Grant +?You're Not Listening ?by Kate Murphy.
• Finally,?here ?is?a complete list, with ratings, of 600+ books I’ve read.