Review: High Output Management by Andrew S. Grove

Almost 30 years after its publication, this book feels a little bit dated (the praise of email as a new and powerful tool early in the book is a bit of a giveaway). Although many things about how we run businesses have not changed in those 30 years (or the last 300 years), some have, and that limits the scope of where this book is useful. Moreover, some of the practices described in this book (e.g. one-on-ones, goals & objectives, etc) are now fairly well known (perhaps partially because of Andy Grove’s influence?), so if you’ve worked at a large company for any stretch of time, those parts will feel self-evident and skippable. In general, the book is targeted at middle managers in large corporations that largely produce physical products (e.g. Intel), so if that’s what you’re doing, it’s still a good fit. Otherwise, you may want to look elsewhere.

For the most part, the writing is clear and concise, although some of the earlier chapters, rather than focusing on stories and research, spew a lot of platitudes and adopt a “thou shalt” style. You should pay attention at meetings! You should ask good questions! A manager should take his role seriously! This is all true, obvious, and not actionable. We should all also eat healthy and exercise, and yet, most of us fail to do that. This book is still useful as an outline or checklist of what to do, but the reality is that most of us already know what we should do; the really tricky question is how to get people to do it. A book like “Creativity, Inc” offers more real world and actionable answers to these sorts of questions.

A few other thoughts:

This book comes from a world where management is a promotion from individual contributor. There is no faster way to kill a tech org than to signal to your technical talent that individual contributions (e.g. programming, design, etc) are “second class work”. World-class technology isn’t created in a meeting room; someone actually has to sit at their desk and build it. Modern companies (e.g. Google) are finally beginning to recognize this and creating equivalent “tracks” for both managers and individual contributors (e.g. a VP may be equivalent to a distinguished engineer role), but there is still a long way to go, and books like this don’t help.

The final part of the book, “The Players,” is strong and as applicable today as ever. Some of the key insights include:

• Knowledge work depends on intrinsic, rather than extrinsic motivators. In other words, a manager can’t directly motivate an employee; they can only create the right conditions where the employee’s internal drive can flourish.

• I like the idea of using Maslow’s Hierarchy of Needs to reason about compensation and rewards. You must meet the lower levels (salary, benefits, good colleagues) or the higher needs don’t matter. However, beyond a certain point, the lower needs are fulfilled and stop mattering; for example, above a certain salary, a raise becomes a much less powerful lever. Eventually, you get to the self actualization, which is nearly insatiable: give people ample opportunity to learn, to decide their own fate, and to be recognized by their peers, and they will feed off of that nearly indefinitely.

• The chapter on Task Relevant Maturity is also interesting. The idea is that the management style needs to differ based on the maturity of an employee at accomplishing their assigned task. New, inexperienced employees need constant managing, training, and feedback. As the employee’s experience and maturity increases, the management style should be more and more hands-off and largely focused on setting goals and providing encouragement. It’s actually quite similar to raising a child: the older and more mature they get, the more the parent needs to stand back.

• There is a good discussion on how to give negative feedback in an employee review (or anywhere else, for that matter). When hearing negative feedback, a person will go through the following stages: ignore (what problem?), deny (that’s not really a problem!), blame others (it’s not my fault!), assume responsibility, and finally, find a solution. The way you act depends on what stage they are at. For example, if you try to pitch a solution when the person is still in denial, you’ll fail.

Finally, some of my favorite quotes from the book:

“As a general rule, you have to accept that no matter where you work, you are not an employee—you are in a business with one employee: yourself. You are in competition with millions of similar businesses. There are millions of others all over the world, picking up the pace, capable of doing the same work that you can do and perhaps more eager to do it.”

“The sad news is, nobody owes you a career. You own it as a sole proprietor. You must compete with millions of individuals every day, and every day you must enhance your value, hone your competitive advantage, learn, adapt, get out of the way, move from job to job, even from industry to industry if you must and retrench if you need to do so in order to start again.”

“Because indicators direct one’s activities, you should guard against overreacting. This you can do by pairing indicators, so that together both effect and counter-effect are measured. Thus, in the inventory example, you need to monitor both inventory levels and the incidence of shortages. A rise in the latter will obviously lead you to do things to keep inventories from becoming too low.”

“The output of a manager is a result achieved by a group either under her supervision or under her influence. While the manager’s own work is clearly very important, that in itself does not create output. Her organization does. By analogy, a coach or a quarterback alone does not score touchdowns and win games. Entire teams with their participation and guidance and direction do. League standings are kept by team, not by individual. Business—and this means not just the business of commerce but the business of education, the business of government, the business of medicine—is a team activity. And, always, it takes a team to win.”

“Reports are more a medium of self-discipline than a way to communicate information. Writing the report is important; reading it often is not.”

“An estimate of the dollar cost of a manager’s time, including overhead, is about $100 per hour. So a meeting involving ten managers for two hours costs the company $2,000. Most expenditures of $2,000 have to be approved in advance by senior people—like buying a copying machine or making a transatlantic trip—yet a manager can call a meeting and commit $2,000 worth of managerial resources at a whim.”

“Consider a venture capitalist who after making ten million dollars is still very hard at work trying to make another ten. Physiological, safety, or social needs hardly apply here. Moreover, because venture capitalists usually don’t publicize their successes, they are not driven by a need for esteem or recognition. So it appears that at the upper level of the need hierarchy, when one is self-actualized, money in itself is no longer a source of motivation but rather a measure of achievement. Money in the physiological- and security-driven modes only motivates until the need is satisfied, but money as a measure of achievement will motivate without limit.”

“Once in the self-actualization mode, a person needs measures to gauge his progress and achievement. The most important type of measure is feedback on his performance. For the self-actualized person driven to improve his competence, the feedback mechanism lies within that individual himself. Our virtuoso violinist knows how the music should sound, knows when it is not right, and will strive tirelessly to get it right. Accordingly, if the possibility for improvement does not exist, the desire to keep practicing vanishes.”

“Why does a person who is not terribly interested in his work at the office stretch himself to the limit running a marathon? What makes him run? He is trying to beat other people or the stopwatch. This is a simple model of self-actualization, wherein people will exert themselves to previously undreamed heights, forcing themselves to run farther or faster, while their efforts fill barrels with sweat. They will do this not for money, but just to beat the distance, the clock, or other people.”

“Money has significance at all levels of Maslow’s motivation hierarchy. As noted earlier, a person needs money to buy food, housing, and insurance policies, which are part of his physiological and safety/security needs. As one moves up the need hierarchy, money begins to mean something else—a measure of one’s worth in a competitive environment. Earlier I described a simple test that can be applied to determine the role money plays for someone. If the absolute amount of a raise in salary is important, that person is probably motivated by physiological or safety/security needs. If the relative amount of a raise—what he got compared to others—is the important issue, that person is likely to be motivated by self-actualization, because money here is a measure, not a necessity.”

“Training is, quite simply, one of the highest-leverage activities a manager can perform.”

Rating: 3 stars