Lean manufacturing is resiliency

I’ve been working with DEs (designer-entrepreneurs) for nearly 15 years now. Through out that time, I have been gratified -but usually dismayed- by how DEs typically manage growth and success. As long as they’re operating at a low level, many DEs seem to function quite well. Paradoxically, the thing that buries them is success! For example, if you’re working along in your small shop with two or three others, managing your own limited production, my book may seem like overkill but if you want to position yourself for moving to the next level, the systems of blocks, working with contractors and cutting to order will become paramount. In this same vein Yossi Sheffi, professor of engineering systems at MIT has authored a new book entitled The Resilient Enterprise: Overcoming Vulnerability for Competitive Advantage.

In a review by Jonathan Byrnes (published in Harvard Business School’s Working Knowledge newsletter), Sheffi’s book is introduced in terms of the dangers of success with a quote from Daryl Wyckoff -“Success often hurts, and even mortally wounds, well-run small businesses“.

While the book seems to focus primarily on supply chain management (Sheffi is director of MIT’s Center for Transportation and Logistics) the core of Sheffi’s work gravitates toward substantiating known concepts of lean manufacturing. Byrnes summarizes Sheffi’s book by saying that companies can build flexibility through process and structural changes such as interchangeable parts (pattern blocks) standardized production facilities (controlled sewing processes) to say nothing of just-in-time product development (cutting to order), eliminating the need of costly inventory and carrying excess capacity. Lastly, Brynes emphasizes Sheffi’s preoccupation with corporate culture saying that resilient companies push decision making to their outer limits. Jason Robb concurs the lean view saying

Yossi’s view is that resilient companies have a corporate culture that pushes decision making to the periphery. In Toyota, for example, anybody on the production line can stop the line if they see a problem. This culture of responsibility runs from the top to the bottom. “People in resilient organizations know that when disruption is evident there is no time to go through the bureaucratic processes.”

According to this NPR interview, Sheffi defines resilient organizations as mindful ones (see this related article), organizations with low decision levels so that the solving of problems is not delayed. He further describes resilient organizations as those having redundancies -which no doubt makes lean practioners uncomfortable- but further defines redundancies as flexibility. A contractor I’ve known has always said that DEs should have multiple contractors even if they don’t seem to need them; in the event of a work stoppage, the work of one facility can cover the shortfall of the other. Sheffi describes the prototypical nightmare scenario as one in which an organization does not know it is the subject of an attack. Again, his solution is pushing decision making ability further down to increase flexible response. For you this means that while it may be costly if the stitchers on the floor stop the line over a mis-cut collar, their decision has given you the opportunity to re-cut the thing in a timely manner rather than constructing the product and dealing with all of the subsequent and even more costly returns. Sheffi says the greatest problem facing government and industry is the tendency of our culture to assign blame. Reiterating the need for open product reviews, a DE must be mindful that if someone brings up a problem, one’s first response is to understand how the problem was manifest, and not to find someone to blame for the problem. In a culture of blame, no one will discuss problems lest the finger be inadvertedly pointed at them. Your product review (style meetings) must be blame-free, otherwise, no one will speak up to prevent huge wastes of money (see pp 75-80 of The Entrepreneur’s Guide).

Lastly, I’m encouraged by Sheffi’s obvious adherence to systems thinking (he is a professor of systems engineering) as that is the only way to understand lean manufacturing. If systems thinking sounds too obscure to be practical in your business, consider this definition from Wikipedia:

Systems thinking involves the use of various techniques to study systems of many kinds. It includes studying things in a holistic way, rather than purely reductionist techniques. It aims to gain insights into the whole by understanding the linkages, interactions and processes between the elements that comprise the whole “system”. Systems thinking can help avoid the silo effect, where a lack of organizational communication can cause a change in one area of a system to adversely affect another area of the system.

This is another book I’ll be adding to my Amazon wish list. I’d be interested in hearing what you have to say about it too.

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