My good friend Guillermo Fernandez, the retired General Manager of Colgate-Palmolive Mexico, would always say: "Common sense, the most uncommon of all the senses." Here is a true story to exemplify this very point.
Way back when, I worked for an automotive parts supplier based in Metropolitan Detroit. This supplier was feeling the pressures from the first wave of foreign competition which at that time was the Japanese. Our factories were full of old but still functional equipment. Everyone was scurrying about trying to learn “the secret” that the Japanese were using to beat us at what we thought was our game. Companies were implementing Statistical Quality Control, Quality Circles, and Taguchi Experiments. Executives were mandating the use of these tools willy-nilly, as if just plastering the factory walls with control charts would somehow make a difference.
I even heard a VP level executive say “I want each department to run two Taguchi experiments by the end of the year.” He got his two experiments, because he was serious about it. It was in the objectives of his direct reports. The results? So-so to meaningless. There were control charts everywhere. But without the management mindset and process to properly utilize the tool, the charts really were like wallpaper. After awhile, it was sad to walk through and see charts that had not been updated for weeks or months. Most factories I go through these days are much better managed.
The automotive supplier had a factory in Logansport, Indiana. The factory made springs; all types of coil springs from smaller than you would find in a ball point pen to those hefty ones that you would find on a heavy truck suspension. They had hundreds if not thousands of parts in their catalog. As the flavor of the month was Just-in-Time (JIT) manufacturing, the company, and hence this particular factory, were tasked to implement JIT ASAP. The plant manager of this facility was a go-getter. He implemented what he thought was JIT immediately.
I was in the factory helping solve a quality issue. I had heard of this JIT stuff. You have to remember that it was all new back then. So, I asked about it. I was told they were making product only when the order came in, to the amount of the order. I was thinking, wow this is pretty impressive. Their goal was to have no finished goods inventory except what was on the shipping dock about to be loaded on trucks.
I was working in the factory in an area where they were making smaller springs. I noticed the operators were putting springs in several containers. They sent one container to shipping and put the rest in some nearby shelving. As I thought that was contrary to the JIT mandate, I asked the workers why they were overproducing. The guys were honest and said:
• It takes use three hours to change over the line to run the next scheduled spring
• The run for the JIT order takes only 15 minutes to run and then we are doing another set-up
• It seems stupid so we just run the product for an hour and next time we have an order we just fill it from our stash and have a three hour break.
I then realized these operators understood that you cannot really do JIT when the changeover time was nine times longer than the run time. They also realized that make-to-stock was more appropriate to the Physics of their Supply Chain in which the old machinery was designed for long productions runs and not quick changeovers.
Common sense was indeed uncommon amongst management, but the operators were loaded with it.
