"Can you do it?" Stacey asks. "If the goal includes the word 'more', can we achieve the goal?"
"I see what you mean," Lou responds, still smiling. "No, of course we can't achieve a goal that is open-ended. What we'll have to do is to try and move the division toward that goal. And you are right, Stacey, it's not a one-shot effort, we have to con-
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stantly strive toward it. Let me rephrase my initial answer." And in his punctuating voice, emphasizing each word, he concludes, "A good job will be to start our division on a process of on-going improvement."
Turning to me, Stacey says, "You asked for an idea of how to tackle the subject? I think that we should proceed from here."
"How?" Donovan echoes the question that everybody is thinking.
"I don't know," is Stacey's answer. When she sees Bob's ex- pression she says defensively, "I didn't claim to have a break- through, just an idea."
"Thank you Stacey," I say, and turning to the rest I point to the white board that nobody has bothered to erase yet. "We must admit that it is a different angle from the one we had so far."
We are stuck. Donovan's question is certainly in place. So I try to gain some momentum by cleaning the board and writing in big letters "A process of on-going improvement."
It doesn't help much. We sit in silence for a while staring at the board.
"Comments?" I ask at last. And, as expected, it's Bob who voices everybody's feeling.
"I'm sick and tired of these big words. Everywhere I go, I hear the same thing." He stands up, goes to the board, and mim- icking a first grade teacher he intones "A process... of... on-going... improvement."
Sitting back down he adds, "Even if I wanted to forget it I can't. Hilton Smyth's memos are all spotted with this phrase. By the way Alex, these memos keep on coming, and more often than before. In the name of savings, at least saving paper, can't you do something to stop it?"
"In due time. But let's keep at it. If nothing comes out of these discussions, then the only useful thing that I will be able to do as the division manager will be to stop some memos. Come on Bob, spit out your frustrations."
It doesn't take much to encourage Bob to voice his true opin- ion. "Every plant in our company, has already launched at least four or five of those pain-in-the-neck improvement projects. If you ask me, they lead only to indigestion problems. You go down there, to the floor, and mention a new improvement project and you'll see the response. People have already developed allergies to the phrase."
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"So, what are you suggesting should be done?" I pour some more fuel on his flames.
"To do what we have done here," he roars back. "We, here, have not done any of these. We have not launched even one formal improvement project. But look at what we have achieved. No talks, no big words, but if you ask me, what we've achieved here is the real thing."
"You're right," I try to calm the volcano that I have awak- ened. "But Bob, if we want to do the same in the entire division we must pinpoint what exactly the difference is between what we have done and what everyone else has tried to do."
"We haven't launched so many improvement projects," he says.
"That is not accurate," Stacey responds. "We have taken many initiatives: in shop floor procedures, in measurements, in quality, in local processes, not to mention the changes that we have made in the way we release material to production." Raising her hand to stop Bob from interrupting, she concludes: "True, we didn't call them improvement projects, but I don't believe the crucial difference is that we didn't bother to title them."
"So why do you think we have succeeded where so many have failed?" I ask her.
"Simple," Bob jumps in. "They talked, we did."
"Who is playing with words now," I shut him off.
"I think that the key," Stacey says in a thoughtful tone, "is in the different way we interpreted the word 'improvement'."
"What do you mean?" I ask her.
"She is absolutely right!" Lou beams. "It's all a matter of measurements."
"For an accountant," Bob speaks to the room, "Everything is a matter of measurements."
Lou stands up and starts to pace the room. I rarely see him so excited.
We wait.
At last he turns to the board and writes:
Then he turns back to us and says, "Everywhere, improve- ment was interpreted as almost synonymous to cost savings. Peo-
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pie are concentrating on reducing operating expenses as if it's the most important measurement."
"Not even that," Bob interrupts. "We were busy reducing costs that didn't have any impact on reducing operating ex- penses."
"Correct," Lou continues. "But the important thing is that we, in our plant, have switched to regard throughput as the most important measurement. Improvement for us is not so much to reduce costs but to increase throughput."
"You are right," Stacey agrees. "The entire bottleneck con- cept is not geared to decrease operating expense, it's focused on increasing throughput."
"What you are telling us," I say slowly, trying to digest it, "is that we have switched the scale of importance."
"That's precisely what it is," Lou says. "In the past, cost was the most important, throughput was second, and inventory was a remote third." Smiling at me he adds, "To the extent that we regarded it as assets. Our new scale is different. Throughput is most important, then inventory-due to its impact on throughput and only then, at the tail, comes operating expenses. And our numbers certainly confirm it," Lou provides the evi- dence. "Throughput and inventory had changed by several tens of percent while operating expenses went down by less than two percent."
"This is a very important lesson," I say. "What you claim is that we have moved from the 'cost world' into the 'throughput world'."
After a minute of silence I continue, "You know what, it re- ally highlights another problem. Changing the measurements' scale of importance, moving from one world into another, is with- out a doubt a culture change. Let's face it, that is exactly what we had to go through, a culture change. But how are we going to take the division through such a change?"
I go to pour myself another cup of coffee. Bob joins me. "You know, Alex, something is still missing. I have the feeling that the entire approach we took was different."
"In what way?" I ask.
"I don't know. But one thing I can tell you, we haven't de- clared any improvement project, they grow from the need. Some- how it was always obvious what the next step should be."
"I guess so."
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We spend good time. We bring up the actions we took and verify that each one actually has been guided by our new scale. Bob is very quiet until he jumps to his feet.
"I nailed the bastard!" he shouts, "I have it!"
He goes to the board, grabs a marker and put a heavy circle around the word 'improvement.' "Process of on-going improve- ment," he booms. "Lou and his fixation on measurements forced us to concentrate on the last word. Don't you realize that the real sneaky SOB is the first one?" and he draws several circles around the word 'process.'
"If Lou has a fixation about measurements," I say somewhat irritated, "then you certainly have a fixation about processes. Let's hope your fixation will turn up to be as useful as his."
"Sure thing, boss. I knew that the way we handled it was different. That it wasn't just a matter of scales."
He returned to his seat still beaming.
"Do you care to elaborate?" Stacey inquires in a soft voice.
"You haven't got it?" Bob is surprised.
"Neither did we." We all looked perplexed.
He looks around and when he realizes that we are serious he asks, "What is a process? We all know. It's a sequence of steps to be followed. Correct?"