You have goals and objectives (G&O) at all levels within your company, even if they are not well defined or documented. At the highest management level it may be profitability, growth, or ROA goals. At the plant level it may be to produce cabinet panels or furniture parts with zero defects, the retention of employees, or on-time deliveries. In sales it may be monthly volume or the number of new accounts per quarter.
However, every company has events that occur, prohibiting it from reaching its goals and objectives. Thus, a situation exists in all wood products companies (yours included), whereby we are vulnerable to failure due to these events. Any such event or circumstance that prevents one from reaching G&O is a constraint by definition. Some of your goals are critical for the future of your company and are being constrained by a single event or by a multiplicity of events. In either case, these can be simple issues or very complicated ones that have become constraints to your growth and prosperity.
In the midst of our day-to-day responsibilities, we spend a lot of time dealing with urgent matters that pop up and keep us from meeting our goals. I remember back in my days as COO when there was a frequent flurry of activity in order to address issues to prevent a late delivery, correct mistakes or other daily disruptions that always seemed to surface. For the past 12 years as a consultant I have seen this repeated in companies of all sizes.
The interesting thing is that companies like these usually find a way around the issue, and I am sure it is the same with you and those with whom you work. It is amazing how we find a way out when faced with a crisis. We humans are good at being flexible enough to adapt to adversity and figure a way out of it. It is as if there is something instinctive within us that drives us through a difficult situation.
Being flexible is a good thing because we must adjust to the changing circumstances around us in order to be successful. We have to keep our customers happy and adapt within our factories and shops because “stuff happens.” A simple example could be that one of your finishers, Jack, begins working on a four-drawer chest or a cabinet and finds a bad dent or scratch. He has no choice but to send it back to sanding or to repair it himself. In this case he chooses to sand it out while he has his hands on it, rather than disrupting other operations and further delaying the progress of that piece through finishing. That’s showing flexibility and ingenuity. Instead of whining, he does something about it.
I am sure you can cite dozens — if not hundreds — of similar examples in every area of your company, every day. After all, this is what helps us meet our long- and short-term goals and objectives — flexibility!
Avoiding the Status Quo
Being flexible is good and necessary, but it cannot stop at reaction or adaptation to circumstances. The key management matter of today is will Jack (or would you) ask the questions: “Why did this happen in the first place?“ “What caused the scratch?”
If you do not go past the reactionary state of flexibility and ask why this happened in the first place, you are just treating the symptoms of a much larger issue. If you do not dig further, you are ignoring the constraint itself that is lurking — often hidden. These causes are what you must identify and remove. If you do not, you will maintain a dangerous status quo in your company.
We both know that maintaining the status quo is certain death to a company today, so let’s look closer at the simple example of the scratches mentioned above. The production goals that were set for the factory that day included producing a certain number of quality items. Now, at least these two goals are in jeopardy of being missed, or have already been missed depending on how you look at it.
The symptom (scratch) was obvious, but why was it there in the first place. What caused it? Was it because too much work-in-process (WIP) inventory was piled up and the cabinet or part was damaged in handling and re-handling? Was it because of another handling and movement issue? To get to the root cause of this very simple issue we need to go through the steps found in the diagram on the next page, so we can make positive change to prevent this particular event from happening again.
Handling the Habitual Naysayers
Some of you are already thinking ahead and see difficulties in eliminating the causes of one or more of your constraints because of “Frank.” Everyone has had a Frank around at one time or another. He is the guy that thinks that he knows it all, that the company is on top of things and has been successfully handling the root causes of your constraints, the same way, for the past 10 years. Frank will find two reasons why you cannot prevent scratches like Jack encountered, for every one good solution you propose.
This kind of person will create a “Culture of The Status Quo” within your organization instead of a “Culture of Change” that I write and talk about so often. If a company finds itself with a group of Franks, it will be lucky to avoid having CPR just to stay alive.
Hopefully, as you approach the end of this year you will begin reviewing your company performance and look ahead to 2009. When you do this, inquire about what is preventing you from meeting your goals and what is being done about it. You and your management must go after these issues as if your very corporate life depends on it. You must convince your Franks that the company will not survive if it does not implement change that results in improvement. It should not be very difficult for you to do this since it is the truth.
Occasionally, there are Franks that just can’t change. They become like a cancer and spread throughout the organization. No matter how painful, these must be removed for the good of everyone else.
The Ones That Can, Get It Done
As I have stated before, your employees know their jobs better than you and are quite capable of telling you the reasons something is not working in the factory, office or in the field where they work. A successful company must tap into this wealth of knowledge. Most in our industry have recognized this, but there are those who still do not get it. Employee empowerment in a culture of change (or continuous improvement) is one of the most valuable management tools available today. There is no better method of achieving your corporate objectives than motivating your people to devise and implement positive change that will address the biggest challenges that are preventing you from achieving your goals.
If you level with them and explain the facts, the vast majority will go to bat for you, and the others will follow in a matter of months. Yes, it is a challenge to accomplish this, but the reward is worth the huge effort required. You just do not have the luxury of maintaining the status quo!
Tom Dossenbach is the president of Dossenbach Associates Inc., a Sanford, NC-based international consulting and research firm. Contact him at (919) 775-5017 or e-mail [email protected]. Visit his Web site at www.dossenbach.com. Past Management Matters columns are archived here.
Free Webcast April 24: Lean Manufacturing. Tom Dossenbach and Steven Jarrett discuss how to lean the production process while improving productivity and profitability.
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