An old friend and one of my greatest teachers, Jim Blanden, told a story of how the Greek philosophers sat around debating how many teeth an ox had. What should be obvious is to get off of your butt and go look in a few mouths and stop talking about something you have no data on.
I saw a great parallel to this at Honda of America over two decades ago. They have several simple practices to facilitate problem solving. Quite simply they start meetings asking for a show of hands of who has seen the problem to be discussed. Those that don’t raise their hand are excused and cannot participate.
Wow. Think of the hours, days, weeks, years that could have been saved during your career if people understood opinions don’t make any difference, data does.
Yet there are several instances of just that any time we touch most organizations.
The one that has me most intrigued is one going on with a long time customer of ours. It is an organization, which has been bought and sold multiple times in the past few decades and stripped of resources each time, but in spite of all that still has a few dozen of the most prominent name brands in the world. But their market share continues to erode, mainly being attacked by store brands and generics where the price difference doesn’t fit the price elasticity model of a lot of consumers. Clearly they need to be more efficient in the value stream to the customer and they need to strip away excesses in their corporate structure.
Their version of “ox teeth” is sigma level. There is a raging ongoing debate if there is value in further improving their capability. This is being debated from the boardroom to the factory floor while the people charged with continuing improvement are getting trapped into the mindset that went away while we helped them improve output by greater than 25% (and saw an additional 4% profit while doing so). The trained resources are gradually shifting to other pursuits, mostly outside the company.
What should they do? What any rational businessperson should know to do instinctively – go quantify the opportunity and make a decision based on ROI. And not just in the value streams serving the customer, but in SIOP and R&D and Purchasing and …
Just a hint, you don’t find those answers in the Balance Sheets or any of the reporting to Wall Street but they are discoverable and quantifiable if you know what you are doing.
If you don’t know how, call me.
Gary
(313) 506 1594
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