Welcome to my new blog.
I want to start with an update to a blog I wrote in early 2009 because I think it is relevant. I just wanted to take a moment to update you on what I am seeing and thinking in this transitional decade.
1) This is not the time to invest in training the masses in programs that promise a nebulous payout in the future. The next quarter is uncertain, and companies have processes that are not working right because volumes have diminished, people have been moved around, suppliers are struggling, customers are not paying on time … Improvement is needed on critical processes now. To that end, we have done more business in the past three years fixing specific problems for customers. Some quick examples – freeing capacity to constrained production lines (20% overall increased capacity in NA for a Fortune 50 company), improving truck loading for a CPG company to reduce transportation costs, improving forecast accuracy to improve cash flow, and launching new products / processes more reliably to meet ROI promises and hit market windows. The annual value of fixing these issues has ranged from about $75K to >$2 billion. Cost has never been more than one-fourth of the annual value of the problem and in most cases was less than 5%.
2) We have been working a new model. I believe it is the natural evolution from Lean and Six Sigma implementations that were heavy on training and heavy on the use of customers’ internal resources. We have been going into companies that are successful, but struggling. Most are in high growth industries and have recently acquired, then integrated, two or more companies. They have poorly documented processes, too many SKU’s, bad delivery, and are losing customer business and confidence. We go in with a small team of people and completely analyze the existing situation and formulate and execute a plan to correct it for the customer. We still need resources from the customer, but on the order of one-twentieth what we asked for in the old model. It is tedious work, but we have focused resources on not taking away from the customer’s focus on the day-to-day, and everyone participating has ten years or more experience in solving these types of problems.
3) Enterprise software! Most companies have data integrity issues of MES solutions not talking to SAP accurately. We’ve all been there; identify a flaw in the system to be put on a 6-month waiting list by the already overworked IT function. We decided to do something about it and have our own IT resources that will get the problems solved as quickly as they are identified. We draw from the same resources that your company probably outsources your IT to so that ownership and understanding are not obstacles.
I just wanted you to think about these. I believe they just make sense. Engaging outsiders on very specific tasks instead of the shotgun efforts are way too common in this community. Get the results quicker and stop the “train and blame culture” that is rampant in the Lean and Six Sigma.