Abort, Retry, Fail?

November 26th, 2008

The economic nosedive is affecting Acme. Open orders on the books are dwindling. It was just announced that the plant will be closed for two days because of business conditions.

About 10% of the orders are past due. Past our promise, mind you, which is almost always later than what the customer wants in any case. To some extent, we as a factory cannot help that; a machine that makes parts for a Really Large Tool usually cannot make parts for a Really Small Tool. Capacity is not interchangable for any and all models. When several machines break down several times for product that is fairly unique, we have limited outsourcing options and must slog through our backlog when we finally get the machines up. And replacing machines requires capital from Corporate–hardly forthcoming in this climate.

But if we can’t find a way to adapt our idle capacity to deliver our backlogged product, well, then we are wrong two ways at once, offering product nobody wants and tardy delivering product our customers need to keep their customers in an increasing strained market.


November 26th, 2008

Acme gives all of its employees a turkey at this time of year. Acme employs a lot of temporary workers–which is to say, Acme does not employ them, they are employed by the agencies, so they do not get turkeys. Acme does employ a number of high school co-ops; since they are Acme employees, they get turkeys. Many of the temps work for a much longer period of time than the co-ops, to say nothing of more hours a week; but the co-ops are employees of Acme and the temps are not.

There are also two college co-ops interning from a nationally respected college. They are employed through the temp agency, and do not get turkeys.

One of those co-ops has been given a role as a planner, and has been fully effective in that role–more effective than perhaps one or two of the salaried planners. This co-op happened to be standing by my desk when the announcement came over the intercom that employees must claim their turkeys in the next ten minutes, as the remainder would be sent to the Food Pantry.

“I don’t understand why I can’t have a turkey,” she said.

“Oh, you can have a turkey,” I assured. “Just go down there and ask for one. Any of the managers you have worked for will gladly give you a turkey.” But she was very unsure, so I went down with her.

“You already got a ten dollar gift card from the temp agency,” objected one of the HR associates.

“You have plenty of turkeys left,” I countered. The other managers standing around were talking amongs themselves and not paying any attention. The co-op got a turkey. But she felt guilty and embarassed, as though she were theiving it. We happened upon the plant manager as we walked back. “Tell her she deserves a turkey,” I said, and he did.

The next day, the HR Manager came to my desk and explained that, for legal reasons, we have to keep a clear distinction between our employees and the employees of the temp agencies.

On whose authority?

November 19th, 2008

The Big Mean Scary Guy is gone. Let’s call him Vice-Admiral; he was not an Admiral but he was a vice, and it gives a vague premonition of his stature in this global, multibillion dollar company. The rumor is that Vice-Admiral was told not to get on the plane for the trip he was planning. This transpired while the Vice-Admiral was here, in our town, inside the plant he had threatened to lock up with his own hands. There were a few poignant days as the rumor circulated around and settled in.

The termination of his employment came as he was wrapping up one of those theatrical events wherein the top brass show that they have a strong connection with the common man by working alongside him. Of course the common man mostly continues to do the work as the attendents of the honorary present a bounty of colored charts and expert opinions, but I digress from my point.

The Vice-Admiral had been keel-hauled by a congregation of distributors for the way our promise dates and delivery dates fluctuated independently of one another, so that while our promise dates were near our delivery dates were far, and vice-versa. To rectify this malady the Vice-Admiral had instituted an absolute policy of set lead times, so that we would not ship anything before we promised it and would not promise anything before we could ship it. The lead time was to be long enough that we could ship no matter how high the waves or strong the winds. In the course of events we still found several kinds of calamities severe enough to prevent us from meeting this lead time, but the general effect was to promise the product much later than we ordinarily needed to ship it, and to refuse to ship it sooner (on pain of our lives!).

Whatever song had been sung at that august gathering of distributors, the clamour raised by customers in general as we refused to ship product we had in boatloads (because our set lead time had not yet elapsed) reached into other branches of the Admiralty. The Vice-Admiral himself was persuaded to some moderations of the policy, first reducing the set lead time and then even granting better dates as the inventory allowed on the most popular items. This latter policy, I have recently learned, he condemned as contrary to his express directive, not admitting to any part in the discussions that had lead up to it.

May you trouble these waters no more, Vice-Admiral.

In keeping with this policy on lead time, all manner of new processes and reports were invented to support shipment by our promise date. Our manufacturing software allows for three dates: The date the customer wants the order, the date we say that we will ship the order, and a third date that actual schedules the supply chain. This third date, which I will call the schedule date, can be aligned to either of the other two dates. Before the Vice-Admiral reinvented our business, it was aligned to the customer’s date, which was generally the same as the date of order entry. This paid no heed to how long it actually took us to manufature the product. For example, if a widget takes three weeks to manufacture, you could wake up in the morning and be three weeks behind schedule because the customer ordered a widget last night. Scheduling was impossible.

Under the Vice-Admiral’s new rules, the schedule date was aligned to our set lead time, which (one hoped) always gave us enough time to manufacture. But by nature of it being a fixed amount of lead time, if we happened to have the widget in stock already the customer still had to wait three weeks. And our inventory levels are readily visible to a large number of our customers.

If you have not already deduced this, the Vice-Admiral’s replacement wants to replace all the sails and rigging and go right back to using the customer’s date. This reverses everything we have been fighting for over six bloody months; remember that our ship’s Captain was one of the casualties. Many of the crew are reluctant to take up the new Vice-Admiral’s wishes before they are expressed in a ironclad command.

There is a third way. We can continue to tie the schedule date to our promise date, but allow our promise date to fluctuate as our supply situation warrants. This tempers the evil of the promise dating heading east while the delivery date heads west; while we might still miss our original delivery date, they will at least tend in the same direction. It also removes the evil of refusing to ship to the customer while stock languishes on the shelf.

The one flaw in this compromise solution is the factors considered in floating the promise date. Certain considerations, such as scheduled work orders, are not necessarily reliable data in our system. In short, if we accept this floating logic we will miss significantly more of our promises than we do currently, and since we have been getting only a passing grade on our promise dates as it is we are terrified to make that change.

It is necessary and proper that we do. Then, we feel the pain of the problems with the system and we have constant motivation to improve. Remaining with our set lead time lets the customer in for a larger share of the dissatisfaction and allows us to be happy while they are disgruntled. If our grades drop but customers complain less we are in less real danger than we are if we have perfect scores and unhappy customers. With low scores we will face constant questioning from the admirality; with high scores and unhappy customers we risk sudden death.

My day ended today after my regular work hours as I watched the Captain and the First Mate decide to cut our set lead time in half for certain spare parts that our suppliers are supposed to ensure are always in stock. I argued as best I knew how for the floating promise, as described above; but who am I?

The Failure of Emergency

November 6th, 2008

I just checked to see what I had last written and found I have been even more delinquent than I had imagined. I did not tell you anything about my multi-state tour to set up my little invention that so pleased my boss: the On Time Delivery Bridge. It keeps track of lines that we ship late and helps compile the reasons why so we can review the results and say “Oh! We have a problem here!”

But that story is for another time. I am going to try to be brief and my moral for today is: just because you have an emergency doesn’t mean you are doing something right. We had some very high level people in the plant recently (you can only go one level higher I think), and we were all told after they left that they were concerned because they didn’t feel a “sense of urgency” in the plant.

I figure what they really found lacking was a sense of purpose. Nobody has any confidence that the leaders as a group really have any idea or agreement about where we are going and how we want to get there.

But let’s talk about having a sense of urgency. Let’s talk about what it taking about half of my disposable (I choose what to do) time: expedites. Here’s how lame this situation is: We were instructed to use certain set lead times, not dynamic lead times, so that we would have consistent delivery results and a consistent measuring stick to check our consistency on. This has worked reasonably well for our tools–although there were a lot of issues until we got a set lead time that was almost tolerable for the market. But we based our set lead time levels on how much of a product we had shipped. When we applied this same model to our spare parts, any part which hadn’t shipped much wound up with a long lead time (more than two calendar months).

Not because it takes us that long to make the product, mind you. Because the model showed that “not many” customers wanted the product, so we didn’t have to ante up for a faster delivery.

So, customer places an order for a part he needs, walks away for a month. Comes back, wondering what the heck happened to his order. It’s still there, promised out another month or so. Customer gets mad and wants to have his part now. Oh, okay, that will be another two weeks because that’s how long it actually takes to make. . . you could have had it two weeks ago but we were waiting for our set lead time to elapse.

Or you can have it right now, we have thousands of those gizmos in stock, we were just waiting for our set lead time to elapse.

This is causing friction with our customer base. When we get comfortable with the month of November we are going to look at the whole policy and see if maybe we can fix it a little.

Meanwhile, when the customers call their service reps and start swearing and screaming because their order is so late, the rep sends the expedite request to me. I’m supposed to examine this request and make sure they have filled in all the little details and given a proper, adequate, and justifiable reason for the expedite request. There’s a little seed of a good idea in here: if you change your schedule every time any customer says, “I want my stuff,” you wind up with no schedule at all. It is necessary to put the brakes on some requests, especially when the customer, via the customer rep, says “You have some, I want it now,” and we really have to hold onto that stock to fill another, earlier order. Those situations sometimes come up.

Most of the time, though, the customer has either already waited weeks, or they are seeing a date that is months out. And I’m supposed to make sure all the i’s are dotted and t’s are crossed. If I don’t, I make the production team mad with the frivolous expedites and disregard for supply chain realities. But I can’t spend too much time checking on the details because the expedites come in at a steady clip and most of them just need to have that ludicrous set lead time overridden so that the order can ship before I start collecting a pension. And the more often I do that, the more I get expedites that “must” ship the next day–really just feeling me out for a real lead time.

Sense of urgency? Sure. I am working frantically, urgently, to try to tear through all these expedites, especially so that the 20% or so that really are urgent will be looked at, and the 5% that are truly urgent and I can easily fix will get on their way without further delay.

I got your sense of urgency right here, and it’s not because I am doing my job so well but because the decision-making leadership is doing their job so poorly.