BusinessWeek’s March 23-30, 2009 issue focuses on Smart Ideas for Tough Times which describes how managers are trying new things to weather the downturn.  The most interesting part of the series covers 11 management ideas that are the basics of any business education, but were quite revolutionary at the time.

This 4 part series (See Part 1 here, See Part 2 here) will examine these ideas alongside social media to see if we are witnessing a world-changing idea, or just another management fad.  First, here is the recap from BusinessWeek:

Some of the most powerful and lasting management methods were launched during tough times, when companies needed new ways to manage costs and grow. Here is a look back at some of the biggest ideas over the past 100 years.

1910 – The Assembly Line – Explanation

1920 – Market Segmentation – Explanation

1931 – Brand Management – Explanation

1943 – Skunk Works – Explanation

1950s – Lean Manufacturing – Explanation

1967 – Scenario Planning – Explanation

1973 – 360 Review – Explanation

1987 – Six Sigma – Explanation

1989 – Outsourcing – Explanation

1990 – Reengineering – Explanation

2000s – Open Innovation – Explanation

# 7 – 360 Review

The Breakthrough – Employees get a better perspective from feedback collected from their supervisors, peers, subordinates, and customers/suppliers

Question – Can Social Media provide a more candid, well-rounded assessment of one’s performance?

• Answer:  Yes, with limitations
  
• Social Media greatly improves the ability for managers to assess their talent.  It is now easier to reach more people that can provide feedback as well as reduce the time it takes to collect the feedback – the major complaint with 360 Review
• Because the technologies make it quicker to communicate, employees can receive feedback in real-time, making it more relevant and more actionable
• However, 360 Review feedback requires anonymity which, if not managed properly, can take away the benefits of reach and speed

# 8 – Six Sigma

The Breakthrough: Quantifying processes through statistics to improve and control their outputs

Question – Can Social Media improve business processes through identifying defects and improving outputs?

• Answer:  Nope, not even worth it
• Six Sigma removes subjectivity and boils processes down to data and statistics.  There is no room for interpretation in Six Sigma, and this is important because it is used to make jet engines, medical devices, and nuclear technology
• Social Media is most successful when it facilitates the exchange of ideas and information between people who share the same interests.  It works best when it’s open to interpretation

#9 - Outsourcing

The Breakthrough: Identifying partners who specialize at performing complementary tasks for an organization at a fraction of the cost

Question – Can Social Media provide more opportunities for companies to focus on the tasks they do well and pay for tasks that are not a differentiating part of the value they bring to customers?

• Answer:  No, value comes after the fact
• A company should outsource tasks that distract from their ability to improve product value.  This is why most companies outsource processes like Benefits Administration, Facilities Management, and – interestingly enough – Customer Service.  Many brilliant leaders have weighed the value these provide and determined that profit maximization comes from hiring these outside.
• With Social Media, you can learn the impact of these decisions through a richer discussion with your customers.  Social media allows you to better listen and quantify the level of customer dissatisfaction associated with the outsourcing decisions your are making.