Jun 28, 2009 | Uncategorized
No secret in being right, just be prepared to be wrong, and be prepared to accept the responsibility for being wrong, then learn from it.
Thomas Watson Sr was spectacularly wrong when he said “there is a market for perhaps 6-8 computers in the world”, but IBM went on to create the industry, ride the wave, and then reinvent itself after almost dying, and today is still a dominating presence.
Orville Wright in 1900 said “not in a 100 years will man fly”, got that wrong by 99 years, and Bill Gates dismissed the internet before recognising the mistake and radically changing Microsoft’s strategy virtually overnight, and accepting in a memo to all Microsoft employees he had made a mistake, and asking them to join him in fixing it.
When you are prepared to take a considered chance, you will get some wrong, and people forget, you will get some right, and nobody notices, and you will get a few spectacularly right, and everybody thinks you are enormously smart, and perhaps a bit lucky.
Jun 28, 2009 | Management, Strategy
I am sometimes asked the differences between Lean and Six Sigma. The “toolboxes” for operational improvement represented by these two approaches contain substantial overlap, particularly at the relatively basic level where most improvement initiatives start.
Lean seeks to maximise the value of a process to an end customer by elimination of waste in the process, waste being defined as anything that does not add value to the consumer, whereas Six Sigma seeks to achieve stability in a process by the elimination of variation through the process by the use of statistical improvement tools.
The overlap occurs because a wasteful process always suffers from variation.
It can also be argued that the Lean approach is a more macro approach that includes the management of human resources as very important to the improvement, whereas Six Sigma focuses on a more micro, quantitative approach to improvement.
The final irony in any discussion about lean, 6 sigma, and the TPS, is that it all comes from Henry Ford, who evolved a management system using the principals espoused in all three approaches, subsequently lost when he died, and his various writings ignored until the Japanese, post WW11 looking to rebuild their shattered economy came across them. If you did not click the hyperlink above, I suggest you do now for a brief history.
Jun 25, 2009 | Demand chains, Management, Strategy
Three things constitute the basis of decision making in most enterprises, Risk, Cost and Reward. Boiled down, this is what it is all about.
In a supply chain, each participant does its own assessment and comes to a conclusion about the balance between RC&R in their situation, and acts accordingly.
For a chain to work with maximum productivity, each of the participants needs to come to a bunch of conclusions that complement all the others in the chain, and rarely will this happen on its own.
In some manner, control needs to be exercised through the chain, and as most managers know, managing the things over which we have so called control is usually hard enough, without setting out to manage things over which we have no control.
The control cannot be applied, it must be accepted as consequence of being a part of the larger entity, the chain, which is a part of maximising the RC&R matrix for the business.
Jun 24, 2009 | Demand chains, Strategy
One of the hidden challenges in most transformations of a supply chain to a demand chain, is the alignment of the incentives through the chain.
For a demand chain to be successful, each point in the chain must see its own best interests best served by serving the best interests of the entire chain.
In a normal supply chain, each point sets out to maximise its own position, with little regard to those “upstream or downstream” of them, leading to gaming, which almost always produces sub-optimal outcomes.
Aligning incentives provides the opportunity to maximise the productivity of the resources tied up in the chain for all concerned.
Jun 23, 2009 | Management, Marketing, Strategy
When considering an important move, the range of possible reactions to the move by competitors often receives too little attention.
Predicting competitive response to a move is of critical importance, and clear analysis should be done prior to committing resources.
A simple test, often missed, is to put yourself in the position of your competitors, and allowing for the management style and culture of the competitor ask yourself a couple of questions :
- Will I see the move, and consider it relevant?
- What is my likely response?
When you have answered those questions to yourself, you are in a position to consider the wisdom of the initial move, and counter measures that may be required.
