Dec 20, 2010 | Demand chains, Leadership, Lean, OE, Operations, Strategy
The next time you hear an argument that justifies moving Australian manufacturing to a low cost country in order to compete, refer to this post on the Evolving Excellence blog describing the work practices in a Toyota’s Kyushu plant.
Labor is much more than a pair of hands doing a repetitive job, it is an opportunity to improve processes and identify and solve problems before they can impact on the customer, or even the next bay in the production line.
It may be hard to get to this point in Australia, but you will have no chance of making the changes necessary in a contract manufacturers plant in a “low cost” country. The accountants will generate their numbers, which can be pretty persuasive until you recognise that they do not account for the things that make a difference in the market, or count the wasted time, emotion and energy in their “productivity” calculations.
When an abundant country like Australia becomes a net importer of food, we have a real structural and strategic challenges in our demand chains that urgently need to be met, and the sooner we recognise the scale of it, and do a bit more than just mouth platitudes, the better.
Dec 15, 2010 | Lean, OE, Operations
Applying a band-aid to a problem, a measure to counter the impact of a problem is often an attractive short term option, particularly to a management measured in the traditional way on output, to whom stopping a line is heresy. Superficially it may hide/solve or move the problem, and it is easier in the short term than doing the hard yards to identify the source of the problem, and eliminating it.
However, counter-measures are rarely solutions, and they almost always come back to bite, usually at the worst time possible.
Years ago in a plant I was running, we suddenly had trouble with a carton erector at the end of a high speed line, and whilst we kept the thing running with numerous counter-measures of various types, the impact was obvious when you looked at the overall line productivity numbers.
We eventually took a hard look at the problem, formed a team of people who had a range of specific skills we thought relevant to the problem, and went through a process of what would be now called “root cause analysis” using the “5 why” tool , but then was a little less defined, at least to our early but evolving understanding of the principals of lean.
Below is a summary of our steps through the 5 why process :
Why did the case packer crash?
- The sensors failed to “find” the edges of the flat cartons
Why did the sensors fail to find the edges?
- The edges were a bit more “ragged” than was usual
Why were the edges “ragged”
– The suppliers knife used to cut the cartons became blunt with use, producing a ragged edge
Why was the supplier not replacing or sharpening the knife more often?
- We had changed suppliers to get a small cost reduction, and there was nothing in our specifications about the tolerances required by the sensors to pick the edge of the carton, state of the edges or knife maintenance.
Got to the answer in 4, but it took a while, and was a bit messy, but once we understood the root causes were the performance measures imposed on the Purchasing Manager, and the lack of cross functional communication and complete specifications, the solutions were blindingly obvious, and nothing like any of the counter measures that had been used to date.
Nov 18, 2010 | Alliance management, Collaboration, Innovation, OE, Strategy
Only in physics, in personal relationships we seek common ground, people who under stand instinctively what we are saying and thinking, and who work the way we do.
Collaborative teams and alliances of many types often fail from the start because those who join, or are “volunteered” are similar, whereas in a collaborative team with a problem to solve, you need all types, and the processes to assist the management of the group need to be a part of the consideration.
You need at least one of each of the four behavioral extremes;
- Someone who is creative, out there, not too concerned with convention and how it has been done before
- Someone who is numbers and data driven, analytical, who seeks quantitative foundations for hypotheses and ideas
- Someone who just has to complete, they like to plan, and then work the plan to the end
- Someone who builds bridges, and can assist the relationships, both internally and with outsiders
These four types will not often come together without assistance, as they are very different, they see thing in conflicting ways, but to solve a problem, or make an alliance really work and create value for all, that’s just what you need, it is just harder to manage.
Oct 7, 2010 | Customers, Management, OE, Sales, Strategy
Since man sought to organise themselves beyond family groups, geography has been the fundamental organising principal of almost all the institutions created, it was really the only thing that made sense. Everything from businesses to empires and the church(s) were geographically organised structures.
Since the 70’s, many commercial institutions have attempted to reorganise along a customer or product driven logic, largely with limited success. Geography and the transaction costs associated with removing the natural barrier of distance have conspired to make it difficult and costly, and the old management silos are hard to break down until the enterprise is in real trouble, as IBM was in the 80’s.
For the last 10 years at a huge rate the net has removed geography as a significant driver of organisational structures. It simply makes no sense to now have multiple overheads in neighboring geographies, when the net tools enable the sharing of everything immediate.
The outcome, structure your organisation to focus on what keeps it alive, customers!
Sep 27, 2010 | Management, OE, Operations
Continuous improvement initiatives I have seen almost always impose a “finishing line”, correctly believing that focusing on an objective is a key to motivate performance.
However, what they often miss in this approach to improvement is the cultural aspect of continuous improvement, the recognition that there is no finishing line, just the next challenge, and the real management challenge is to build a capacity to improve continuously as a foundation of the culture of the business,not just to address the current issue.
Another of the many paradox’s that exist in our world, to motivate, have a goal, but having a goal other than an inbuilt desire to do it better today than you did yesterday, can be counter-productive
Sep 15, 2010 | OE, Operations, Small business
Focusing attention holistically on a whole process, end to end, and the productivity of the process will improve, improving the outcome.
When you focus just on the outcome, all you get is the opportunity to improve the efficiency of the existing process, but it will have no sustainable impact on the productivity of the process itself, and inevitably when you just focus on efficiency of one part, over time the whole process will at the very best, remain at the stable level, because as you make efficiency improvements in one spot, in another, something has gone wrong to reduce the efficiency of that point in the process.
If you want to improve, focus on the whole process, not pieces of it.
