Management 101

A Japanese company (Toyota) and an American company (General Motors) decided to have a canoe race on the Missouri River. Both teams practiced long and hard to reach their peak performance before the race. On the big day of the canoe race, the Japanese won it by a mile. The Americans, who were very discouraged and depressed, decided to investigate the reason for the crushing defeat.

A management team made up of senior management was formed to investigate and recommend appropriate action. Their conclusion was that the Japanese had eight people rowing and one person steering, while the American team had eight people steering and one person rowing.

The American Management felt that a deeper study was in order, so they hired a consulting company and paid them a large amount of money for a second opinion. They advised them that too many people were steering the boat, while not enough people were rowing. American Management was not sure of how to utilize that information, but they wanted to prevent another loss to the Japanese, so the rowing team’s management structure was totally reorganized so that there were steering supervisors, three area steering superintendents and one assistant superintendent steering manager. They also implemented a new performance system that would give the one person rowing the boat greater Incentive to work harder. It was called the “Rowing Team Quality First Program,” in which there were meetings, dinners and free pens given for the rower. There was discussion of getting new paddles, canoes and other equipment, along with giving him extra vacation days for practices and bonuses for success. The next year the Japanese won the canoe race by two miles.

Humiliated, the American Management laid off the rower because of poor performance, they halted development of a new canoe, they sold the paddles, and cancelled all capital investments for new equipment. The money saved was distributed to the Senior Executives as bonuses and the next year’s racing team was out-sourced to India.