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Is management mumbo-jumbo undermining your company?.

Is management mumbo-jumbo undermining your company?

It started with expressions such as 'going forward', 'touching base' and 'at the end of the day', but management speak now goes much, much further. Today's executives routinely talk about getting all their ducks in a row, picking the low-hanging fruit and sprinkling their magic.

To relieve the tedium of meetings where managers babble on in this way, there's even the game of management-speak bingo. Participants prepare bingo cards with buzzwords such as 'pre-planning', 'scalable' and 'long tail' and tick them off when they are uttered. The first person to tick off all the words on his or her card raises a hand and uses the word 'Bingo!' in a comment or question.

It's all good fun, of course - IBM has even created a commercial around it - but it hides the serious damage that management mumbo-jumbo may be doing to an organization. Richard Rumelt calls it 'fluff' in 2011's issue 1 of the The McKinsey Quarterly

- superficial abstraction that simply masks the absence of rigorous thought.

According to Rumelt, too many senior people equate strategy with 'mom-and-apple-pie values, fluffy packages of buzzwords, motivational slogans and financial goals'. But these are simply elements of bad strategy, which ignores the power of choice and focus and tries instead to accommodate a range of demands and interests. Bad strategy fails to face up to problems, mistakes goals for strategy and 'ends up pursuing a dog's dinner of conflicting policies and actions'.

The author contrasts this with good strategy, which involves formulating specific and coherent responses to - and approaches for overcoming - obstacles to progress.

Good strategy, says Rumelt, harnesses and applies power where it will have the greatest effect. This could be, for example, in launching a new product or responding to changing market dynamics. The author argues that the heart of a good strategy is insight into the true nature of the situation, into the hidden power in a situation and into an appropriate response. It involves digging beyond the superficial and facing up to the hard problems with honesty and integrity.

Boeing is a company that has done just that. Hal Weitzman describes in a July 2011 issue of the Financial Times how supply-chain problems have twice thwarted the US aircraft-maker. First, in 1997-98, the company tried to ramp up production of its 737 airliner without checking that its suppliers were ready. The resulting parts and labour shortages forced Boeing to halt production at its 737 factory in Renton for a month - a stoppage from which the company took more than a year to recover.

Secondly, Boeing outsourced much of the design, engineering and production of its new 787 Dreamliner to suppliers around the world. But much of this had to be reworked back in the US, damaging the company's reputation and triggering late-delivery penalties with airline customers.

Weitzman explains how Boeing has confronted these problems head-on. It now outlines its production plans much earlier so suppliers know exactly where they need to invest to meet the aircraft-maker's demand for parts. And it monitors its suppliers much more closely.

With Boeing planning to increase production of all its main commercial aircraft from 462 in 2010 to 770 by 2014, and with each aircraft containing hundreds of thousands of parts, good strategy for the aviation giant is most obviously to ensure the seamless operation of its supply chain.

Where can clear thinking and action-orientated strategy for the real world make the biggest difference for your company?