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Step #2: Apply The Fundamentals With Rigor |
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Free Feature Article |
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This article is about the 2nd of the 10 Steps to Low Cost Business and points out that we often try to invent solutions when they already exist and then sometimes don’t fully implement them. The result of this, of course, is not a low cost business!
STEP #2 – APPLY THE FUNDAMENTALS WITH RIGOR
Key Idea
Significant improvements can be achieved by applying known and proven management solutions with discipline. There is generally little or no need to ‘reinvent the wheel’ and without the discipline to follow through, half implemented solutions are unlikely to drive results.
Key Observations
There are three key things that support an approach based on applying fundamentals to improve business operations:
1. The library is full of management information and theory 2. Research can uncover what the best performers do to achieve their outcomes 3. The surest way to achieve a successful result is to observe what works and then copy it
If these three things are true, then why do so many companies try to ‘invent’ a new way?
Almost every issue that is faced in every organization has already been addressed elsewhere. Sure, some organizations pride themselves on innovation in their management processes and without this there would be little or no progress in management thinking. However, innovation is something that needs to be deliberate, controlled and resourced.
Therefore, the questions that need to be asked are:
Is your business aiming to be leader in management thinking and management innovation? Do you have the resources, systems and robust discipline to develop new ways of managing in business?
Would you be better off replicating actions that have been successful elsewhere?
Even a company as innovative as GE based its growth on programs involving six sigma and the Internet, neither of which GE invented. They applied existing thinking into their environment. This was the core of GE’s innovation – the application, not the original idea. (GE did coin the term e-business but obviously they did not invent the Internet.)
Having decided to implement an approach that works elsewhere many businesses then often fail to implement the appropriate systems with discipline. (Obviously this was not the case with GE!)
This failure to implement with discipline results in a business that looks like it has a system in place (and often has them well documented) but in practice the system is not followed and is therefore, not effective. The management of this type of company may be able to fool itself into thinking that everything is OK when it is not.
A variation on this is that some companies ‘cherry pick’ the interesting or ‘sexy’ aspects of a management process and apply that part with some rigor. This approach fails because it often misses out on the fundamentals upon which the management practice is based.
As an example of this, a company may purchase a powerful maintenance management IT program and then invest in training their staff to use the program. If they then fail to put in place the resources and discipline to keep the data up to date the output becomes out of date and is useless. In this case a great idea is poorly executed and the system adds little or no value. They may say that they have an up to date CMMS but it is of little practical use.
In the New Operations Improvement Cycle many businesses move too quickly from the phase of Laying The Foundation to the phase of Optimizing Performance. This is because Step 2, Apply the Fundamentals with Rigor is probably the toughest step to implement. Stripping your view of business back to the fundamentals can take real strength because this often means admitting to or acknowledging the mistakes of the past. Implementing with rigor can take real courage because many people do not like the discipline that this requires.
If you and your business has or can develop the strength and courage to implement Step 2, your business results will improve remarkably.
You need to review Step #2 if you have:
Step #2 Do’s
Step #2 Common Mistakes
Case StudyWalk the Talk
At a major automotive firm Senior Management were concerned about the operational performance and wanted an audit of the maintenance practices.
An audit such as this is typically completed in two stages. Firstly, a desk audit to ensure that there are policies, procedures and systems identified which reflect good practice. Then a systems audit to check that the policies, procedures and systems are followed. That is, do they do what they say they do?
In this case the desk audit went very well. There was a well thought out and proactive series of policies and procedures. There was also good use of visual management.
The systems audit, however, revealed that in many cases the ‘official’ policy was only followed when it was ‘convenient’ to do so. Equipment reports were completed ad hoc, programmed activities often ignored and results not maintained. This meant that the plant was not only not maintained properly but that the data that the planning team was updating was incomplete. Consequently the plant performance was unacceptable.
All this resulted from not applying sufficient rigor to the implementation of what should have been an effectively sound maintenance management process.
How does your business manage this? Are you guilty of poor implementation of good ideas?
About The Author
Phillip Slater is the author of the book A New Strategy For Continuous Improvement. For more information visit his website at http://www.InitiateAction.com.
Note: You are welcome to reprint this article online on the condition that it remains complete and unaltered (including the ‘About the author’ info at the end) and you send a reprint to enquiries@InitiateAction.com |
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Initiate Action Pty Ltd 49 Vida Street, Aberfeldie Vic 3040 Australia phone: +61 3 9331 3181 fax: +61 3 9331 3180 USA and Canada Free Call 800-581-7678
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