Oct 8, 2025 | Analytics, Leadership, Operations
We have learned over time, led by Toyota, that ‘root cause analysis’ thereby seeing the root cause of problems is the road to continuous improvement.
At any time when there is a problem, do not let it get papered over, do not let the symptoms be treated, dig and dig until you understand the root cause and then fix it.
Often this is a challenging task, root causes by their nature are usually well hidden, and often ambiguous until there is a forensic examination. However, they are always there and rooting them out enables a compounding of improvements over time.
That analysis requires a cultural context in which to work, as it takes time, consumes resources, and is never completed, as there is always another problem to be analysed. That is the nature of problems, root out one bottleneck, and the blockage just moves to the next spot, previously hidden by the former one.
However, we also seem to look at a process from its beginning, setting out to define a hidden problem occurring inside the process.
Should we reverse the order, and look at the causes of success?
Why and how has Toyota managed to remake themselves from the crappy stuff carrying the lousy quality implications of ‘made in Japan’ from my childhood to an icon of quality, and in the process, driven change through manufacturing globally?
What is the root cause of their success?
My contention is that the root cause is a simple piece of rope.
The Andon cord.
Toyota put Andon cords through their factories, so that any person on the line could stop the line at any time when they saw a fault.
Not only were they empowered to stop the line, they were expected to do so any time a problem occurred that could not be fixed in the time allowed at that station in the line. When the line was stopped by a worker, the supervisor immediately went to the stoppage point with two objectives:
- Solve the problem to ensure it would not be repeated, and that the problem got not one step closer to a customer.
- To congratulate the worker for stopping the line so the problem could be fixed. This ensured there was not any reluctance to address a problem by such radical means as stopping a whole factory.
This is an extreme example of empowering the front line, making those who can see problems as they face them all the time, responsible for fixing them.
When introduced, this must have caused headaches, as the productivity would have plummeted. The number of cars produced dropped off a cliff, but those that got through would be as good as they could be, and slowly, as problems were solved, productivity rose, quality rose, as over time Toyota became the benchmark for motor vehicle quality around the world.
All from a simple piece of rope, and the surrounding culture that delivered to those at the coal face, the responsibility to exercise their right to pull it.
What is the equivalent of the Toyota Andon cord in your business?
Oct 1, 2025 | Marketing, Strategy, Uncategorized
Management attention is an investment.
However, I have never seen a calculation of that investment made without the benefit of hindsight. Considering the return on management attention (ROMA) seems to be a sensible element of investment due diligence.
As a consultant I’m always urging clients to focus their resources, time, money, expertise, operational capacity against a narrow field. This focus of resource is always superior to a generalised approach in winning in the short term.
Nowhere are military metaphors more appropriate then in a competitive commercial environment. Every general knows that to win the battle, he needs overwhelming force in a specific space.
However, every general also knows that a war is not won in a single battle. To win the war, you also must be able to adjust to changes in the context in which the war is being waged and respond accordingly.
Years ago, while working for Cerebos, I was responsible for Cerola muesli, now departed from supermarket shelves. In those days there were only a few major SKUs in the breakfast cereal aisle. Wheat Bix, Kellogg’s Corn Flakes, Rice bubbles, and a few other relatively minor SKUs. Muesli was out on the fringes, widely seen as ‘tree hugger food’.
As an extension to Cerola, we created a strategy that straddled the gap between those major cereals and muesli and named it ‘Light & Crunchy’.
We launched it into a test in South Australia. We believed we could build the Cerola brand to be more than just ‘hippie-food’ by creating a new category in the Cereal market. There was an unmet need, a potential gap in the market. That gap could be leveraged (we believed) with a good product and effective marketing programs to generate trial, which would lead to repeat purchase.
The early stages of the test were an enormous success. We easily got retail distribution, consumer trial and repurchase rates that were well above our benchmarks for a successful test.
The significant miscalculation made was not anticipating the weight of the response from Kellogg’s.
It came very quickly with a competitive product called ‘Just Right’, a direct copy of Light and Crunchy. Just Right still exists, which validates our identification of the unmet need. Kellogg’s competitive launch was supported by overwhelming advertising, consumer promotions, and instore promotional support. That massive, focused response by Kellogg’s simply blew us away, and killed any thoughts of continuing.
Kellogg’s saw our test launch of Light & Crunchy as a significant incursion into their territory. They had previously left us alone in Muesli. Research indicated that muesli, as it had been, was not competing for the same consumers who were purchasing Corn Flakes, Rice Bubbles, and Sanitarium’s Wheat Bix.
With Cerola Light and Crunchy, we changed that, and Kellogg’s reacted with extreme aggression. I had failed to anticipate the reaction, which was with the benefit of hindsight, absolutely predictable.
The real lesson was that we did not have what it took to be competent in the breakfast cereal market. While competence is a term that most would see as a measure of skill, in this instance it was more than that. It was a measure also of our depth of knowledge of the market, the competitive drivers that existed, and sufficiently deep pockets to wage a competitive war on Kellogg’s home turf.
Our attention was too focussed on the opportunity we saw in the market, but substantially lacking in attention to the wider competitive context. We had a skewed focus of attention, and the return on that lack of attention taught us a painful lesson.
‘ROMA’. Return on Management Attention, is always a strategic driver, rarely adequately considered.
Sep 29, 2025 | Marketing
Customers buy to relieve some sort of pain, or fill a need. Sometimes that pain is real, the need genuine, and sometimes it just takes the form of a psychological itch that needs scratching.
Whatever the form and source or type of the pain, nobody buys without it, so your product is medicine for that pain.
Why don’t you tell them that more often?
Be clear: ‘This product is for people who……..’
Many years ago I was marketing manager of the Dairy foods division of the then Australian owned Dairy farmers Ltd. We marketed Ski yogurt, and had been killed by Yoplait who launched with great advertising, packaging innovation, and a pretty good product that had massively increased yoghurt consumption, with them taking all the benefit.
The manufacturing process installed to produce Yoplait ensured that there was no discrete fruit pieces in the end product. It may have been strawberry yogurt, but the product was completely homogeneous. The process Dairy Farmers had installed was different, and we could produce a product with discrete and obvious fruit pieces.
The core of platform of our marketing and innovation processes become ‘Ski: for those who like to see pieces of fruit n their yoghurt. We never used this line, but it was implicit in everything we did.
5 years later, Ski was market leader in a market many times bigger than when Yoplait had launched. While it may not have been painful to buy a fruited yoghurt with no discrete pieces of fruit, when the offer was made, the preference of many became immediately clear.
Sadly, the innovative momentum that drove both Ski and Yoplait was dissipated by a presumed plateau in the market size in the mid nineties, and resultant transfer of resources and energy to kow-towing to retailers.
Sep 22, 2025 | Uncategorized
Ask ten people how they use AI and you’ll get ten different answers. Some weave it into their daily work. Others haven’t touched it at all.
The word task is worth pausing on. Most regular users of ChatGPT and its cousins seem less interested in wholesale job replacement and more focused on automating specific tasks. Think of it as a digital assistant that takes care of the repetitive bits rather than a robot stealing your job.
The productivity impact is wildly uneven. Some see little or no gain. Others call it transformative. In most cases, it isn’t eliminating jobs outright, except perhaps grunt work like simple coding, but it is reshaping how people spend their time. Instead of vanishing, roles are evolving. People shift toward higher-value activities that build on what AI produces.
A recent OpenAI study helps quantify this shift, summarised in this graphic. The standout surprise: only 10% of users pay for a ChatGPT subscription. Given the billions being sunk into infrastructure by the LLM providers, that number points to a future where the providers are anticipating dramatic increases in usage, and are betting big with their Capex. It also means that business models will also change dramatically.
If you want to predict how AI will shape work, don’t look only at the tech. Look at how organisations themselves are changing. Structure and process are leading indicators. Change of the kind anticipated, and what we see starting to happen only occurs under strong leadership with a clear vision. Without the leadership, the power of the status quo exerts itself, and change becomes combative and the results disappointing. This will be the case with the evolution of AI.
MIT research reported in Harvard Business Review shows a brutal number: 95% of AI pilots fail.
That begs the question: what are the 5% who succeed doing differently? Academics, as they do, put their answer into a neat framework: the SHAPE Index. It highlights five traits: Strategic Agility, Human-Centricity, Applied Curiosity, Performance Drive, and Ethical Stewardship. The words may sound fluffy, but the underlying logic is sound. The real hurdle is moving from buzzwords to execution in organisations built to defend the status quo.
One thing is certain: sitting on the fence isn’t an option. AI is already changing the way we work. The only real choice is whether you shape it, or let it shape you.
Are you in the 95% waiting for AI to fail or the 5% figuring out how to make it work?
Sep 18, 2025 | Change, Innovation, Leadership
The secret isn’t glamorous. It’s not an app, a hack, or a shiny new framework.
It’s the part everyone pushes down the priority list as they break a problem into its component parts. The hardest bit. Break the problem into its pieces, then go straight at the hardest part first.
AI now helps us do the problem analysis faster. It can model options, run simulations, and point out blind spots. However, it cannot focus your attention on the hardest bit first, that requires you.
Failure is the toll on this road. Edison’s “I now know what doesn’t work” wasn’t optimism, it was realism. Most attempts will miss. Data won’t rescue you when you’re in uncharted territory. Only cycles of trial, error, and learning will.
And here’s where humans stumble. We hate failure, and often failure has consequences in corporate life, so we become risk averse. We look for shortcuts, silver bullets, or easy wins. AI makes the shortcuts more tempting because it gives us mountains of plausible-sounding answers in seconds. But plausible isn’t proven.
The real advantage belongs to people who can keep their “discovery tempo” steady, using AI as an accelerant while still accepting that most paths will be cul-de-sacs.
AI has changed the speed and nature of problem-solving. What hasn’t changed is the rule: robust innovation comes from persistence through failure. The cycle is now faster, but the psychology hasn’t shifted.
So, the winners will be those who combine two rare qualities: the resiliance and patience to face repeated failure, and the discipline to use AI not as a crutch, but as a lever to attack the hardest part of the problem first.
