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Measure up! Yardsticks for continuous improvement
B O O K REVIEWS
313
reaching the local governments are handled. These rather exciting metaphors are applied with obvious enjoyment, and to the present reader it even seems as though the excitement takes precedence over the need to get close to the data. The strength of this book is in the illustrations of different situations within existing organizations. Even if they are in a sense superficial, not providing access to real actors "of flesh and blood" and thus not getting close to people's intentions and meanings, these illustrations still provide a picture of the complex realities that local governments have to handle. It might have been wise though to have used fewer cases and to have allowed more space for the basic analysis, so as to give the reader a livelier and closer relationship with the data. Christer Olofsson
Institute for Management of Innovation and Technology
Measure Up.t Yardsticks for Continuous Improvement, by Richard L. Lynch and Kelvin F. Cross (Oxford, U.K.: Basil Blackwell, 1990), 213 pp., ISBN 1-55786-099-8.
Richard Lynch and Kelvin Cross address the problem of performance measurements and how to use them. On the basis of interviews with hundreds of managers on both sides of the Atlantic, they found that the measurements used were often too rigid, or too short, or that they were being used like a teacher's ruler - - to whack rather than to motivate. The authors want to replace these outdated yardsticks with more dynamic measurement systems - - systems that motivate continuous improvement in customer satisfaction, flexibility and productivity. Lynch and Cross present a framework of day-to-day management practice that is built upon the principles of total quality management, justin-time workflows, continuous improvement, activity accounting and workflow simplification. It is no coincidence that most of these methods have been forged by Japanese companies. The strength of Japanese competition since the Second World War has made it inevitable that American as well as European companies should align their own management methods with the Japanese way of conducting management control. American businesses enjoyed unprecedented prosperity following the Second World War. They could sell whatever they produced; it was a seller's market. In a seller's market all that counts is output. Large bureaucracies are formed to meet the demand and the finance department enjoys a strong position. There is greater emphasis on external reporting. The authors note that until recently the top American university or business school graduates were specialists in finance, auditing, accounting and tax law, rather than operations management or management accounting. In order to change the yardsticks it is necessary to tackle the shortcomings of traditional management practices, including management by objectives, throwing money and/or technology at problems, and accounting models. So what about the framework
314
BOOK REVIEWS
proposed for guiding the business manager in the effective and competitive application of the performance yardsticks? Importantly, this framework builds upon management principles or methods that can be expressed in terms of activities. Lynch and Cross link the business strategy and the implementation of this strategy to the horizontal workflow, by identifying the activities required to support customers. Thus, they relate top management--operational management relationships to supplier-customer relationships. This identification is achieved by mapping the way work is being done. The authors give two primary reasons for mapping activities. One is that it helps the organization to be more effective in the eyes of its customers. The other is that it is a way of simplifying the way work is done. The focus, they claim, should be not on the vertical chains of command but on the horizontal workflow, regardless of organizational boundaries. The point is thus to view the business from the customers' perspective, and to focus in terms of activities on what matters to them. Operational performance measurements are to be tailored to the sequence of activities. The resulting yardsticks constitute the new performance measurements system. Have Lynch and Cross made any contribution? Purely in terms of facts there is nothing new here. But the authors have done exactly what they said they would do, namely to set up a consistent framework for designing performance yardsticks. Consultants and professionals will certainly derive much from this book. The present reviewer has read Measure Up! with great pleasure, as it is a well-written and highly readable book, providing important insights into performance measurement systems which should be useful to operating, financial and general managers. Even if the documentation of the manager interviews and other data sources do not live up to ordinary scientific requirements, I would not be surprised if Measure Up! turns out to be a classic in operations management. Stefan Schiller
Gothenburg School of Economics and Commercial Law
313
reaching the local governments are handled. These rather exciting metaphors are applied with obvious enjoyment, and to the present reader it even seems as though the excitement takes precedence over the need to get close to the data. The strength of this book is in the illustrations of different situations within existing organizations. Even if they are in a sense superficial, not providing access to real actors "of flesh and blood" and thus not getting close to people's intentions and meanings, these illustrations still provide a picture of the complex realities that local governments have to handle. It might have been wise though to have used fewer cases and to have allowed more space for the basic analysis, so as to give the reader a livelier and closer relationship with the data. Christer Olofsson
Institute for Management of Innovation and Technology
Measure Up.t Yardsticks for Continuous Improvement, by Richard L. Lynch and Kelvin F. Cross (Oxford, U.K.: Basil Blackwell, 1990), 213 pp., ISBN 1-55786-099-8.
Richard Lynch and Kelvin Cross address the problem of performance measurements and how to use them. On the basis of interviews with hundreds of managers on both sides of the Atlantic, they found that the measurements used were often too rigid, or too short, or that they were being used like a teacher's ruler - - to whack rather than to motivate. The authors want to replace these outdated yardsticks with more dynamic measurement systems - - systems that motivate continuous improvement in customer satisfaction, flexibility and productivity. Lynch and Cross present a framework of day-to-day management practice that is built upon the principles of total quality management, justin-time workflows, continuous improvement, activity accounting and workflow simplification. It is no coincidence that most of these methods have been forged by Japanese companies. The strength of Japanese competition since the Second World War has made it inevitable that American as well as European companies should align their own management methods with the Japanese way of conducting management control. American businesses enjoyed unprecedented prosperity following the Second World War. They could sell whatever they produced; it was a seller's market. In a seller's market all that counts is output. Large bureaucracies are formed to meet the demand and the finance department enjoys a strong position. There is greater emphasis on external reporting. The authors note that until recently the top American university or business school graduates were specialists in finance, auditing, accounting and tax law, rather than operations management or management accounting. In order to change the yardsticks it is necessary to tackle the shortcomings of traditional management practices, including management by objectives, throwing money and/or technology at problems, and accounting models. So what about the framework
314
BOOK REVIEWS
proposed for guiding the business manager in the effective and competitive application of the performance yardsticks? Importantly, this framework builds upon management principles or methods that can be expressed in terms of activities. Lynch and Cross link the business strategy and the implementation of this strategy to the horizontal workflow, by identifying the activities required to support customers. Thus, they relate top management--operational management relationships to supplier-customer relationships. This identification is achieved by mapping the way work is being done. The authors give two primary reasons for mapping activities. One is that it helps the organization to be more effective in the eyes of its customers. The other is that it is a way of simplifying the way work is done. The focus, they claim, should be not on the vertical chains of command but on the horizontal workflow, regardless of organizational boundaries. The point is thus to view the business from the customers' perspective, and to focus in terms of activities on what matters to them. Operational performance measurements are to be tailored to the sequence of activities. The resulting yardsticks constitute the new performance measurements system. Have Lynch and Cross made any contribution? Purely in terms of facts there is nothing new here. But the authors have done exactly what they said they would do, namely to set up a consistent framework for designing performance yardsticks. Consultants and professionals will certainly derive much from this book. The present reviewer has read Measure Up! with great pleasure, as it is a well-written and highly readable book, providing important insights into performance measurement systems which should be useful to operating, financial and general managers. Even if the documentation of the manager interviews and other data sources do not live up to ordinary scientific requirements, I would not be surprised if Measure Up! turns out to be a classic in operations management. Stefan Schiller
Gothenburg School of Economics and Commercial Law