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World Class Performance Part III


Technology Trap—Buying Manufacturing Excellence and/or Downsizing as the Solution

In improving business performance, the choices boil down to three areas:

1. Buying technology

2. Downsizing

3. Changing the way we run the business

Examples of technology are world class robots, hardware, software automation, etc., hard tangible purchases. His­torically, the easiest of these three choices has been to buy technology. You can touch and feel this choice; it is nonthreatening. People will not have to look at themselves and their performance. Somehow automation will solve the management and efficiency issues and, of course, people will know how to use this new software information generated and make better decisions and integrate the technology into the business strategies. The perception is that the source of business problems is always a technology issue—enough information or getting the information or reducing costs by eliminating people.

This "buying manufacturing business excellence" attitude is not surprising considering management's fear of change and unwillingness to find fault when looking at them­selves. This is why you see "manual ware" software with thousands of modifications, and integrated world class software overlaid on disjointed management processes. It is like the author's using Jack Nicklaus' personal golf clubs. It isn't the clubs, it's how you use them that's the issue, but to acknowledge that need for lessons instead of clubs as the core issue is extremely hard. I know, I own seven drivers!


It has become very obvious that companies, to become more competitive and profitable, have reduced staff and received a short-term benefit from this reduction or downsized staff. By wholesale cuts we have said to our employees—in a sledgehammer sort of manner "Become more productive or else!" But as Milton Friedman so succinctly put it, "There is no free lunch." Have all of these employees we have jettisoned done nothing or had little or no impact on business performance? Have our internal and external customers said, "We know you have few people so we will demand less?" Have the tasks gone away? Of course not! What has happened is that we expect people to work harder to achieve the same results. But are the people making better decisions in the 12th hour of being at work than they made in the 8th hour before our downsizing? Do our employees have the time to invest in the future growth of subordinates or plan for improvements? Have they had the time to learn how to become more efficient at their jobs?

It has been our observation that if you don't give people the time to improve there will be little, if any, improve­ment. Just because it is a corporate mandate to improve the business doesn't mean it does get done. Downsizing may have a positive short-term impact but may be a long-term detriment by slowly bleeding the life out of a busi­ness because of the lack of time to improve the business operation. What will make downsizing work over the long-term is the achievement of world class levels of perfor­mance. By controlling and managing the business processes people will free up the time required to manage and grow. By working to a defined plan day-to-day de­mands will be met without the need for micro manage­ment of unique solutions requiring non-value-added ac­tivities. By eliminating variances in the business operations and the communication process people will be working on the right things at the right time for the right reason. We will plan what we do and execute the plans, eliminating much of the non-value-added activi­ties that are inherent in managing processes on an hour-to-hour basis.

Simply put, the only way downsizing works is if we teach people to work smarter, not harder, and allow management the time to invest in the continuous improvement of the business and its long-term growth.

In looking at the three choices outlined, there is no signifi­cant long-term competitive edge in buying technology in a vacuum. Everyone in your industry can purchase the same technology. Technology and automation are more and more upgrades versus complete changes. The only significant competitive edge that can't be bought is people and their skills in running a business. Changing the way we run our business is the focus that will produce 75% or more of the return on investment in a world class manufacturing project. Consequently, the focus of this presentation is on world class manufacturing concepts and initiatives—not technology. Downsizing, robotics, or technology-type ini­tiatives, in my experience, are appropriate to examine only after significant work on the way we run the business-type management issues.

Inability to manage change

The fundamental issue that causes project failure is that change creates discomfort. People feel comfortable with the status quo. There is stability in our lives when we know that things are not different. We like routine.

Very bright and well-intentioned individuals, even with a very correct strategy, fail because they don't understand managing change. They edict change and ignore the fundamental fact that the success of improvements is the result of many people embracing and instigating this

change. If not the source of change, people's natural reaction is going along, non-involvement, or in the worst case, verbal sabotage. If you wait long enough it will go away is the attitude toward improvement.

The only way change is accepted is if there is strong leadership and change becomes an evolution rather than revolution. Leadership is required to allow the charter without repercussion to challenge the givens and current practices without repercussions. It also outlines the con­sequences of not embracing change disemployment or non-promotion.

To make change an evolution rather than revolution there must be a catalyst for change. This catalyst allows every­one involved to have a stake in the success of the change process and ownership of the project. World Class perfor­mance is achieved by many people, taking many small steps together that culminate in large results. This cata­lyst to involve people is an applied interactive education process.

To be Continued


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