Communication Varies Throughout the Company

Smiling, Maria opened her hands to the group and announced, “We begin. Are there any questions about what you heard?”

Alison raised her hand.

“Alison?” Maria acknowledged.

 “I only have one question. It relates to the incident some years ago when you asked for $300,000 to fix a problem that was causing 30% rejects. This is pertinent now, because you’ll be reactivating that process. I assume that you still have the equipment?”

Charlie raised his hand to confirm that it was still in the plant. “Now, it has been mothballed for a few years, but we did a complete decommissioning, so it should be ready to go. It makes sense to schedule a dry run, though.”

“The second part of that deals with the expenditure to fix your old problems.  It seems that, given the tough economic times, it may be possible to repair it for less money, because the rebuild company may be more flexible. And, since it was a few years ago, there may be better technology available that would improve the performance and reduce costs. It certainly makes sense to investigate this sooner rather than later.

 “Now, assuming that what you have works, I think I have a way to communicate with corporate in such a way that they will be willing to sign off on the expenditure. I don’t know that we need to take up time right now to detail it. We can do that later if you’d like.”

“Let’s do it now,” Mark said, adding, “I want to know that technique. Not knowing, it cost us a lot, both in sales and emotionally. Morale sank to a new low when we had to furlough friends and neighbors.”

Looking around the table, Alison acknowledged the vote. She continued. “I read this in Juran’s Quality Handbook. I don’t know who the contributor was. The thesis is this: people at different levels within the company speak different languages, and these languages affect how they understand the business. It makes sense, because these people come from different disciplines and each discipline has its own terminology.”

Alison moved to the white board and drew a square, with two horizontal lines slicing it into three levels,

 Senior Management/Financial Managers

                    
                   Supervisors/Middle Management

 

Plant Employees

“People at the top levels, CEOs, senior managers, speak in financial terms, like Investments, return on investments, payoff times, return on capital and the like.

“People at the lower levels speak about ‘things’. They say things like, ‘This thing isn’t working. It’s causing us fits. If we fix this thing, we could solve our problems. For $300,000, we could fix this thing.’

“People in the middle are the middle managers, supervisors and foremen. They have to be bilingual. They’re the ones who translate ‘things’ into terms that make sense to senior management. It’s a very difficult job and many don’t have the skills to do it.

“So, let’s say that we knew, in financial terms, what that thirty percent rejection and the subsequent rework, represented in dollars and cents. Let’s say it is 30% of 8 hours output, and that that machine is supposed to earn the company $800/hour.

“The cost is now identified as 2.4 hours, or $1,920 per shift. That’s and unsustainable number. Now let’s also assume that the solution to fix it is the right one, and it will indeed cost $300,000. We can now estimate the payback time of the investment, the return on investment, and other data, in terms that the bean counters understand.”

Mark’s hand shot up. “So, what you’re saying, in this example, we could have solved our problem with a payback time of about a year or less.”

“Let’s see”, Alison replied. “How many shifts did you run?”

 Shep chimed in. “Three, but it was theoretically supposed to be a one shift operation.”

 Okay, so let’s say we could have made it a shift and a half. The other shift and a half cost $9,600. This doesn’t account for any impact on the subsequent operations, so the number could be even greater. Let’s round it out to $1,000/day. The payoff is 300 days. The ROI is …..”

“I get it,” Mark yelled. “If we had only known how to do this then. Looking back, there were a lot more impact on us than loss of sales. I am embarrassed.”

“Don’t beat your self up too badly,” Alison interjected. “This is a new day in an entirely new economy. Given the urgent need for sales, maybe the people at the top at the top will be more willing to make the investment.”

On Education

“I think we live in interesting times. We live in a time where businesses are demanding people with degrees for even the most basic jobs. We live in a time where many people, in the thousands, have degrees but no education. They have degrees but cannot express their thoughts. They have degrees but they cannot perform in their chosen areas of expertise. They have degrees from colleges that need the enrollments and have lowered their standards to the point where a degree from their institution should have no value in the real world.

I asked myself why there is such a push for degreed individuals at virtually every level and I concluded this: we no longer have faith in our K-12 educational system, so we go after people with college degrees in the hope that, maybe, these people can read and write. Note that I did not say ‘think’. A few years ago, actually it was over two decades ago, Pulitzer Prize-winning journalist David Halberstam came out with his book, The Reckoning. It was a wonderful comparison of two auto companies, Ford and Datsun, which later became Nissan. One of the many interesting points he made centered around the way life had changed, He wrote that a fellow in the 1940s who left school after the eighth grade had a solid enough education to last his entire career. Not so in the eighties. An eighth grader then could not pass the eighth grade tests given in the forties. They simply are too hard. It’s even worse today. So, it is more important than ever that you choose a university with a rigorous, demanding curriculum consistent with the demands of the real world. I am thinking of schools like Carnegie Melon or the University of Michigan. Interestingly enough, Adizes started his own university, and I would not be averse to recommending them.

A major shortcoming of ignoring people without degrees is that you miss so many good ones. Maria would not have been hired by many companies and that would have mistake. Shep had a bachelors degree and, even though he turned around a failing plant, one that was almost destroyed by a guy with MBA credentials, his path forward is blocked for lack of an advanced degree. There are thousands more like them just floating, left out for no good reason.

Not everyone needs a degree. Just go online to www.millionairedropouts.com. You’ll find people you know who somehow achieved success without a degree. Journalist and News anchor Peter Jennings dropped out -- of high school. So did. Bill Gates, Steve Balmer and Paul Allen left college to become Microsoft billionaires. Steven Spielberg dropped out, too. He’s done alright.

Some fields are so new, there aren’t any courses to teach. And, in some fields the best education comes from on the job immersion.