Great innovators are the ones who do what everyone said can’t be done. Columbus. Orville and Wilbur. Einstein. Edison.

Great idiots are the ones who attempt to do what everyone said can’t be done. Since they are so much more common, their names are less famous, though a good historian could name a few (shame on me). Small-time fools expire in the moment of their own education, but the great and powerful fools can leave rows and rows of gravestones as tribute to their innovation.

Since the matters of Acme are not martial, an outcome of actual gravestones will hopefully be avoided. The powers the be have decided to close one distribution center, consolidating it with another. However unpleasant, this could be simply a wise business decision. But the one they choose to close has been the control center for a number of plants, and I have heard mainly good things about it. I visited the site myself and thought it was in excellent working order. The center they are consolidating into I have never personally seen, but I have not heard anything about it about it in particular. From as much I am priviliged to know, therefore, it seems possible that scores of wage workers are losing their jobs because the other warehouse is closer to corporate bigwigs.

Why should I take the most cynical interpretation of inconclusive data? Because of first-hand experience. At our site a certain manager is tearing out our existing inventory storage architecture to install a new system. Nothing wrong with the idea of doing that. The problem is when you dislocate inventory without giving it any kind of official new location, so that it exists in a limbo that depends for its coherence on the care and good keeping of temporary wage workers. Add to this that your new system, while in place physically, also does not have systematized locations with processes for adding, deleting, changing, and reassigning locations. Add to this that your new system, of plain racks, is not getting adequately funded to buy purpose-specific racks. Instead there are ominous rumblings about reusing existing beat-up, repurposed, mismatched racks.

Add to this that your whole new theory of inventory management, sending to the assembly lines the exact quantities and mixes required to complete the scheduled work, is falling apart in every way; the schedule doesn’t hold up, the assembly lines build when there is nobody around to resupply them (which requires either an excessive buildup ahead of time or a lag after the fact, or simply shuts down the assembly), and that the supplier-owned inventory manager is under such strict orders not to release extra inventory (by the same manager) that material handlers cannot get enough parts out in advance of the assembly line’s need for them.

Add to this that the nominal manager of the stockroom said, “Don’t do this thing this way.”

Add to this that everyone involved in the actual physical and transactional processes said “Don’t do this thing this way,” and only the people who hear only the pitch that “this will reduce inventory” are excited about it.

Add all that together, and what do you get? A fool or a hero. Time will tell.

Acme, the international company, has been making changes, divesting from some product lines and investing in others. The changes have been occuring all year, but they are now looming over our site, my Acme. It is verly likely that things will be running differently by the end of the year. Will it be by our choices, or corporate intervention?

It has always been obvious that we haven’t been fully or effectively implementing the modern production theories that we talk about. But we were pointedly told that we talk to much and accomplish too little. Now the prevailing feeling seems to be that we will make changes, even if those changes are advised against for reasons of sanity and efficacy. One of the doctrines of the Lean revolution (and it may be as much a return to previously discovered principles as overthrow of existing doctrine) is that resistors must be removed–those who do not agree with Lean thinking must not be allowed to impede its progress. But if you have people who do agree with Lean principles, and advise against a change because it goes against those same principles, you might want to pay attention–not just rush ahead because somebody somewhere did something like it and it looked good when they did it.

I am vague in part because of my attempt not to trespass to far politics, ethics, and business etiquette. Perhaps I can give an example of another industry’s use of Lean principles to help make sense of the concepts.

There’s a sandwich franchise in our area which has, in relatively recent years, changed its ordering process so that rather than choosing a specified sandwhich off the menu and then requesting alterations to the recipe, the customer can see all the possible sandwhich ingredients and specify any of them in any combination through the ordering process. You start with your choice of bread, then pick meat and cheese, then choose whether it be toasted, then choose vegetables, and finally condiments. Sandwich shops have always allowed a ‘hold the mayo’ approach to customization, but this has taken it one step further, making all the ingredients of the sandwich plainly visible to the consumer, and soliciting the customer’s preference at every step.

The workflow has also been arranged so that rather than a single server taking care of a customer’s order the entire way through, the sandwich is passed in a straight line from bread to condiments. The process can be attended by one, two, or I suppose as many as four or five servers–all that changes is how often the sandwhich is handed off. This allows more flexible staffing. Continuous work flow and training for flexible job coverage are key Lean concepts–and so is providing exactly the product the customer wants, rather than a comittee’s best-guess offering.

Further, the ingredients used are quantitized in an efficient and flexible manner. Rather than having a large chunk of meat or cheese which is cut up all at once, or haphazardly as needed, each ingredient is neatly placed in a container that accomodates a fixed quantity. This allows the shop owners to better track which items are used; it allows servers to quickly, efficiently, and cleanly select needed ingredients; and it limits cross-contamination by having specific and obvious places for each item.

It is almost certain that this sandwhich shop schedules its employee work hours to match demonstrated demand peaks, that it orders its raw materials not by schedule, but based directly on what was previously consumed, and that items which are not proven popular will not be stocked for long.

Cleanliness, order, workflow, minimum of stock, repeatable process, and responsiveness to customer–that’s Lean manufacturing. It is not Acme. Acme is aware of these concepts and makes motions in their direction, but it is at heart still convinced that manufacturing won’t pay unless you build a lot of whatever you can get your hands on. That means that all those secondary things like cleanliness, order, process, and yes, to an extent, even quality, are overlooked or downplayed when there’s a production crunch. It means we have more anxiety about meeting management goals than customer requests.

My attempt at reforming the claims process, previously mentioned, has struggled along, not without measure of success but wavering near failure. I got a call from the order management center asking for some redress to the dire backlog of claims. I dispatched a number of these on Friday, but the process needs reinvigoration.

Sadly, we had no noticeable improvements in August, as the claims went up. We began our reforms mid-August and did not see the numbers until late September, so it is possible that a more positive trend will settle in. Based on the incoming claims, I doubt it.

The main problem we’ve had with the new process is keeping people at it. All of us, myself included, feel more pressure to tend to open customer orders–next-day air shipment expedites of this or that, stop shipments on this, inventory corrections on that–to give much attention to old orders that are in some part wrong. Truthfully, from a customer perspective, the received order is an older customer order, really still an open order since never completed correctly. But claims sometimes come in that are months old, occasionally verging on years old; they are often for one or two missing tools out of a shipment of hundreds. Day to day expedites are always some frantic customer all hot to get something or other, usually being handed off to us by customer service agents who have been whipped up enough to call their way up the chain of command if we do not respond with alacrity. (Some of them do not need an outraged customer to call down fire from heaven on us. Some people are just hard to get along with.)

Knowing, then, that there is a probability that the claims are not urgent, and that if they are really urgent the customer service team will send them a new one regardless of what we have to say about the claim, it is hard to muster the same urgency for claims as for open orders.

Then too, the whole idea of having the order pickers check the claims is foreign to this company, and they have not embraced it. The supervisor of the spare parts pickers tends to do all the checking himself, since he can’t bring himself to make his people do it, and he is not competent to do the most important step, looking up the responsible party on the computer, by himself.

The claims are simply sent by e-mail, without a standard form (which makes database believers such as myself cringe), and the account now belongs to nobody in particular. By disassociating the e-mail account with one particular person, the claims no longer depend on that one person (myself) to be addressed. Like the workflow with the sandwich, this is advantageous in allowing more options for who will serve the customer at any given time. But it also is disadvantageous in that it is a little easier for everyone to ignore.

Fixing the process will require a number of things:

• I must make time in my schedule to insure that all new claims are printed out, and all checked claims are reported back to the customer service center.
• We must determine what process we will use to account for inventory discrepancies–we have an opportunity to start fresh having just completed a plant-wide physical inventory.
• We must decide who exactly is responsible for checking claims. Is it the team leaders or the individual pickers?
• We must clarify what priority the claims have. Do we only look at claims when all open orders are satisfied? Do we look at claims before all else?
• We must standardize the information. The pickers cannot check the claims without a shipment number that I or another office person can provide.

None of these would be hard to accomplish as isolated tasks. The difficulty will be in managing any of them while trying to support P.B. in efforts to rationalize the stockroom by providing information on how much we have and how much we need and where it all is, at the same time supporting our boss K.K. in his effort to lead dramatic change in a short time by reorganizing the stockroom, in which he wants to know where all the parts are for all the products made in a given area (by the way that information is very tricky to extract with ordinary database queries), continuing to fend off the multidudes of special requests and mini-disasters, and coping with a new shipping policy that requires us to juggle freight among carriers based on weight as well as destination.

So improving claims is a task that occupies nobody’s full attention, holds no particular importance in the eyes of the management, and yet is a key symptom in our understanding and control of what is going on in the shipping department. It is neither unimportant enough to be neglected nor glamous enough to attract helpful attention. It is not my favorite project nor one that holds the most significance in the eyes of my supervisors, but among all the multitude of things I am involved in it is the only one for which I have the primary responsibility. If I want to be more than a fault-finding rat-racer, this is what I have to accomplish.

After delivering bad new, I usually grin. Unless I feel personally affected by the events.

This week in the daily meeting, M.B. the production manager gave us the sketchy details of the recent visit by the Scary One (the member of senior management most prone to asking for what we are not ready to deliver). The Scary One had two main points:

1. We spend too much time analyzing problems that we should be simply attempting to fix.
2. We need to complete our visual management system.

On the first point, I agree. To my mind, analysis is a tool for when you no longer have a very clear idea of what is causing your problem. When you have a pretty good idea, take action without waiting for the nitty-gritty. Your solution may be wrong, may even be significantly wrong because of a critical overlooked detail, but it is likely to at least be an improvement, and to be more educational in practice than most analyses are in theory.

As for the second point–well, the greater Acme corporation has comitted itself to a system of communications boards whose design I think is seriously flawed. They communicate a lot of information that the nominal beneficiaries of the boards do not understand or directly influence, thus jeopardizing the communicative function of the boards. But the standard has been agreed upon and committed to by the corporation. In situations where you clearly have to do something ill-advised or unpleasant, it is best to just do it quickly and get it over with. And we haven’t.

After being told about how the Scary One wanted to see those boards in place in short order, one of the planners–one who is admired for his intelligence and not just tolerated for his seniority–began to opine, loudly, insistently, and with some earthy adjectives, on the worthlessness of these boards. His immediate supervisor was in the room, but the two members of the plant staff to whom he is most responsible were present. After initially attempting to interject responses to the planner’s criticisms, the two waited silenty for him to finish his tirade. When he was done, the meeting adjourned.

Within days another planner, who is not respected by anyone, spoke even more disrespectfully in direct reply to his superior.

Nothing that I know of was done in response to either outburst. Something may have been said or done behind closed doors, but I would think that for public rebellion some public punishment ought to follow. Not necessarily what my former boss suggested, immediately escorting the man out of the building and possibly not letting him come back, as that could have blowback. You need employees who will strive to implement management decisions, not deride them publically, but if you don’t want a bunch of empty sycophants, you must also allow some evident disagreement. But the disagreement should be expressed reasonably, respectfully, and with the right audience.

Suspension or firing may be in order. If I were to suspend someone for that, I would want to state clearly to the same audience that witnessed the outburst that nobody would be suspended for criticizing the management policy in my office behind a closed door. I would remind them that they are employed to execute the strategies of the management as well as they possibly can, not to complain about how those strategies can’t possibly work.

I am not very fond of these boards and I can’t blame anyone else who also thinks they are useless. But the decision to use those boards did not come from the managers on the site. It is not their choice; their job is to execute the decision of upper management. They cannot be subjected to abuse for doing their job if it is legal and ethical, and certainly the case in question meets those requirements.

When it comes to ethics, though, I think poorly of my own response to such outbursts, which was to immediately tell people I work with what happened. Did you hear what he said?

It was a public meeting. While those I told were not at the meeting, they had the right to attend. In a strict sense, I did nothing wrong to repeat what was openly said. But there is no glory in revealing the sins of others. I tried to justify myself by saying that this was a major event in plant politics and could have reverberations that would affect so-and-so and it would add so much more clarity to their lives if they knew what was behind it all… but clearly, that is an artificial excuse.

The next week is shaping up to be not much fun. It is the end of a quarter, which raises the stakes, and the end of a bad month that saw a particularly widespread quality issue, and it ends on Sunday. So Saturday and Sunday are both work days, and then at the beginning of the next month all hands are required for the annual plant-wide inventory.

However, because the Scary One, um, scared everyone, certain staff members are frantic to make changes–and not to bother worry too much if the are even at first glance reasonable or reasonably executed, because after all we have been spending too much time analyzing. So my supervisor, the stockroom manager’s supervisor, he decided to start relocating some inventory in this week right before inventory. The timing seems spectacularly bad and this kind of urgency bodes ill for the entire month of October.

So, when I wondered several posts ago if P.B. would keep up the good fight, the answer at this time is it really doesn’t matter. I went with him to his latest performance review, and it turned out not to be a review of his performace so much as an opportunity for other staff members to argue amongst themselves about how best make these hasty changes in P.B.’s area. The man himself, the nominal supervisor of the area, kept his mouth shut, since he had nothing to gain by opening it.

This week at Acme I totally neglected the program to reduce shipping errors. I didn’t have any time for it. I was busy doing nothing.

Through no fault of my own, I got conscripted into a project to do nothing. The goal of the project was to see what kind of information transactions occurred during the entire process of a customer placing an order and receiving the goods and the accounts being balanced–within one particular sales/production model that Acme uses. There was no particular driving concern or goal. It was just data-gathering.

In my experience and training (which is limited), an exercise with no goal accomplishes nothing. Theoretically, this exericise identified some ways we can improve our process. Realistically, we were already aware of the opportunities to get better. So actually, the whole point of us in our plant participating in this exercise was so that we could be seen by the very top level of the company as participants.

Our site was an especially pointless location for a pointless exercise, because we perform no direct customer service functions. We do not take orders or bill customers or do anything other than react to the orders that have been placed on our site by the customer service center, or respond to complaints about orders that have been referred to us by the customer service center. I was not the only one to note that we seemed to have the wrong people and the wrong place to accomplish the stated goals, such as they were.

However, one of precepts of the Intra-Company Code of Conduct kicked in. The Code appears below:

1. I have never seen a problem that we are not in the middle of solving or are about to solve.
2. This was a productive meeting and all participants made an important contribution.
3. I believe and fully trust that all resources I need to overcome the identified obstacles will be made available to me.
4. Everyone is doing a good job and we are on the verge of revolutionary success.

Needless to say, the two-day project was a smashing success.

With Labor Day off, and a half-day wrap-up on Friday, only Tuesday was available for me to do anything. Most of Tuesday was spent doing yet another inventory count at the express request of Accounting, so they could at last reconcile the differences between what we think we have and what we actually have. I happened to talk to the responsible party in Accounting during the week, and now that we have done our third count of the inventory without actually making adjustments, he is planning to just wait another month for the plant-wide inventory. Never mind that he knew full well about the plant wide inventory before expressly asking us to conduct this one. (A thought of actual physical violence went through the back of my mind.)

But let me get back to the theme of the post, and the last precept of the Code of Intra-Company Conduct. I have observed two supervisors–both of whom I respect in at least some degree (these are the skunks of Acme)–who address their employees by telling them that they are doing a fantastic job, they are working hard, and that on the whole they are more successful than anyone in their role ever has been before. This when I know both of them to say, semi-privately, that there are too many people who are doing things quite wrong, and are lazy, and are performing worse in at least one crucial way than we have been recently.

Are they lying? I began by thinking they certainly were. But I turn it around in my mind. If my supervisor, or my supervisor’s supervisor, got up in front of us and said that we were goofing off when we should be working, we were doing important parts of our job wrong, and he was getting pretty severly irritated, I would not respond with affection and increased effort. Even if I were goofing off some of the time and knew it and would admit it, still his blatant disregard for the amount of work I did get done in spite of all the obstacles would make me mad, resentful, and obstinate.

Maybe I am the real liar. When I got a break from the project to accomplish nothing, I ran back to my office and told everybody what a stupid waste of time it was. When the break was over, I ran back to the meeting room and particpated with gusto and smiled and shook hands and agreed that we had attained some important new knowledge as a result of this analysis.

I suppose the idea the managers have is not so much to just misrepresent things in the best light possible, but to say something that will encourage the employees to do better, rather than justifying them in doing worse. Often in these manager pep talks a few things will be noted as somehow, stupefyingly getting worse, despite our valiant efforts; and even perhaps just one point on which we flat out must improve. Maybe this is about all the rebuke the human physce can withstand, and still be cooperative. Granted the positive-negative ratio is typically reversed in military training, recruits can’t unionize or strike or leave for a better job. It makes a difference.

But I wonder how often I have been “spun” by my direct superior, who perhaps thinks I am a pain, or a little dense, or chasing my tail, but tells me that I am doing marvelous things and, while still not perfect, am on track to be sainted before my own demise.

One of the problems I have with leadership, or whatever limited responsibility has come my way, is that I can clearly and passionately see the merit in everyone’s objections to whatever it is I want to do. In the moment, I can usually more empathize with my opponent’s position than my own.

This is a serious disability. But as I observe the successful people around me, it seems that practically the only way they are different than me is their ability to maintain their own idea of what is going while appearing to go along with whatever is being said around them. Obviously they are not mavericks doing whatever they please. Their own charted course must include pleasing their boss. But they are not very upset by, or empathetic with, any objections to their chosen course. They can listen, nod, and say, “You’re right, I completely agree,” and then slip in one very subtle caveat that sounds utterly harmless, like, “we’ll do what you said, just like our customer wants,” and that little caveat actually means “You’re ignoring the obvious fact that we are going to do things my way.”

Is this sleight-of-hand leadership?

I think it is always a part of social leadership. I think, too, that those who try to “lead” with nothing more than this slight-of-hand accomplish little or nothing. I think one of Acme’s problem is that the managers generally aren’t identifying those few, critical obstructions to their goals and eliminating them with overwhelming force. Some people need to be fired. Some people need to be called into the office for a frank explanation of where things stand.

I seem to have survived another end of month. Month ending is alway a busy time because we try to ship as much as possible so that our monthly financial statement looks as good as possible. This practice is deeply engrained in Acme, deeply enough so that all our suppliers realize that we don’t really insist upon having product until the end of the month. Thus there is always a spike in production at the end of the month, as material from languid supplies finally makes it to the factory and into tools.

One of the unpleasant aspects of our inventory management system is that it routinely allocates finished product to orders that cannot ship. There are a number of reasons why an order may not be shippable, but if we generalize and describe all such orders as “on hold,” it will suffice for this discussion. An order may be on hold for reasons the customer is responsible to resolve or for issues with the order internal to Acme. In the latter case, it is evident that inventory should allocate to the order and wait there until Acme figures out its business. In cases where the customer is responsible, however, it would seem that at some point the order should lose its place in line and give all the inventory over to a shippable order. Such is not the case, though, and we have one or two orders allocating inventory that have been there in excess of 100 days.

One of the other unpleasant aspects of the inventory system is that it will allow us to allocate for orders more product than we actually have. This is almost exclusively a problem for spare parts, which are sold to the customer and also used in production of finished goods. The best justification for this loose planning is the parts that are “supplier owned” until we actually take them from stock to use. This allows us to show less inventory on our books and gives the suppliers a convenient way to warehouse their inventory and deliver it to us on time. However, it means that we never show having enough inventory to meet future work orders. So we allocate inventory that we “know” will be available even though it currently does not show as available.

Of course we sometimes do run out of this inventory, despite it being designed to allow uninterrupted supply. But the real problem is the system’s distinction between “hard” allocation and “soft” allocation. With “soft” allocation, the system will reason that I have 10 of part A in total and work order 1 may have seven of those parts and sales order 2 may have seven of those parts. That’s overallocated–that’s demand for 14 parts where only 10 are available–but the system is willing to entertain both commitments. May the best man win, and all that.

Hard allocation is different. Hard allocation says I have 5 pieces of part A in location X and 5 pieces in location Y. Work order 1 will get the 5 pieces in location X and 2 of the pieces in location Y. Hard allocation occurs when an order is actually released to be filled, rather than being booked on the system. Once this is done for work order 1, sales order 2 cannot be released because it can only hard allocate 3 pieces of part A from location Y.

Actually, to be more accurate, sales order 2 would still be releasable for the quantity of 3. The problem comes when we show 3,280 pieces in stock and there are orders vying for 15,743 pieces. Quite frequently the sales orders lose out altogether.

But we could actually ship them. There are 30,000 pieces in “supplier owned” stock on the site. The system simply isn’t aware that we could ship them. By manually intervening and pulling out some of the stock to location Z and manually hard allocating that to sales order 2, you can drop and ship the order. Of course you don’t know for sure if there are enough pieces or if this is one of those cases where we truly don’t have enough pieces to go around. But you can drop the order.

Since, as noted above, a sales order can be released for shipment even if the entire order is not available, it is very possible for half of an order to be released for shipment when the other half becomes available. Theoretically there is no reason why the second half could not be released also. In practice, though, it would be a nightmare in any situation where the veracity of the inventory is not guaranteed. If the first half of the order is out there for 10 parts but we don’t have the parts and I must adjust the order, the system may be releasing orders at that very same time and see that the 10 parts show available and go right ahead and release them on the second half of the order. As to whether that might ever happen–refer to the above on supplier owned inventory.

So there can be some part of an order with truly available stock allocated to it, waiting for the rest of the order to clear shipping so that it can drop. But the order could also simply appear to be allocated, and actually be allocated with non-existent stock so that it cannot actually drop when the first half of the order clears. But this depends on whether the inventory is all “hard allocated” or if there is some that is only “soft allocated” and still up for grabs.

Sometimes there are further glitches so that an order which appears to be shippable is not, or vice-versa.

Okay, got all that? Now come on over to the production manager’s office. His production team needs the spare parts to build tools and gets very upset if you take those parts to ship on sales orders. Also his team builds the finished tools that you need for sales orders. However, they may produce tools “to plan” (that is, for orders that are expected) even if there are no actual orders for the tools and even if there are actual orders for other tools. (In this case, it is likely that we do not have all the components to build the tools that are actually ordered; it is not usual for production to overlook an order that is shippable for one that it is not. But it is possible.)

This production manager told me that if “we” did not ship every single tool for which there was an order by the end of the month, “we” were idiots. The production manager does not understand that it is nearly impossible to make sure no tools are allocated to unshippable orders when the tools are actively coming in to stock; the production manager does not particularly care. The most important thing is that the customer is served, and I am assured that whatever resources I need will be made available to me to accomplish this.

I don’t know if you can guess from just reading this, but it is not altogether easy to explain the situation and the processes for managing it. I cannot take someone from the assembly line down at the computer and tell them to keep pushing this button until all the orders are shipped. Of the four people in the shipping department who manage orders, I am the only one fluent in this aspect of order management. One of the others concentrates on invoicing orders, especially international orders (which is just as complicated), one concentrates on managing the orders when they have been released (which also has a lot of snares and complexities, and requires some management of the workers), and one of them is the supervisor for shipping, receiving, and stock, and has all the bureaucratic hassle thtat cames with that. All of them are generally familiar with the difficulties of getting orders to drop, but none really know the techniques to make it happen besides the basic command to drop available orders. It just makes too little sense and requires analyzing too much data that is not coherently presented by the system.

None of this makes any difference to the production manager, who only understands the first principle of customer service: the customer must be served at all costs. This is indeed extremely crucial for successful business, and is thus very hard to argue against:

Production manager: “If we don’t ship every order we possibly can, we’re idiots.”

Me: “I can’t ship every order that is possible to ship, because there are too many difficulties for me to overcome them all.”

Production manager: “I will give you whatever resources you need to overcome these difficulties.”

Me: “You can’t give me adequate resources to overcome these difficulties.” (He is not my superisor or the manager of my deparment and cannot hire personnel who would be trained to do this work; he can only loan his assembly-line workforce, mostly comprised of temporary workers.)

Production manager: “You are only telling me problems and we need people who can find solutions.”

He kept throwing me “right” principles, and I dearly love right principles, but none of them could be applied in the manner suggested. His most brilliant suggestion was that I make myself more of a pain to my boss until the problems were fixed. I have not failed to make my boss aware of the issues, but to nag, whine, and carp about them does not to me seem like advice with my career in mind.

It would help out customer service a great deal if orders that could not be shipped (because of non-paying customers, which in point of fact are not customers) did not allocate inventory. It would help out customers if the inventory on hand were accurate (a lot of the inaccuracies are driven by loose practices in assembly and machining, responsible to the production manager). We cannot suddenly start worrying about what the customer wants at the end of the month.

And we don’t. The customer is not really in view here, not the customer who wants to use or resell our tools. The real effort is to “ship” as much dollar-value as possible, thus reporting as large as possible profit, which makes the company appear more desirable to stockholders.

The way transportation is set up–your friendly UPS or Fed Ex or DHL, and also your large-freight trucking companies–freight moves to a terminal where it is distributed to other modes of transportation and moved on. There is a deadline for this. Planes and trains and even trucks must leave on schedule. On any ordinary means of transportation (leaving from our location, as schedules vary depending on transportation routes), “shipping” something after 6pm today does not get it any closer to the customer by 3pm the next day than if we ship it at 2:30pm the next day. But on the last day of the month, it is the difference between profit in August and profit in September.

This is why other departments, especially production, always want shipping to stay open as late as possible (even, if they could hope to achieve it, until midnight)–to achieve “credit” for the maximum possible profit to the company. This is good for the shareholders.

A bystander remarked to me, during my discussion with the production manager, that “the stockholder is our customer too.” I understand the reasoning, but is a false equivalence, a confusion of terms. Fundamentally the stockholders rely on us to provide a product or service the actual customer wants. If we spend time and energy doing things that please the stockholder but provide nothing to the customer, we have lost a certain amount of customer support. It may not have an immediate effect; we may have only lost an opportunity to make the customer a certain degree more pleased. But sales is often all-or-nothing. You don’t buy 10% of a tool, or 30%, or 90%; you either buy the tool or you don’t. Often, you contract to buy all of your tools from one company–or another. So if you erode your customer support too far, suddenly it will snap, and you will lose the customer. That can also snowball.

Hence it is extremely dangerous to allow yourself to believe or behave as if the purpose of a publically traded company is to make money for the stockholders (as one of my professors emphasized). This is no doubt how all companies are conducted to a degree, and many companies to a large extent, but it is also what gives you Enron. Morality may be black and white, but cause and effect rarely are; customers will tolerate a certain amount of transgression on their priorities by a company courting stockholders. But the erosion is real, and the breaking point impossible to predict. You cannot provide long-term value to stockholders without spending all your extra effort on providing what the customer wants now and preparing to provide what the customer will want in the future.

In other words, rather than giving extra effort to polishing our monthly financial statement, we should put that effort into producing what the customer wants all month long.

Progess is always much slower than desired. I don’t feel I have much to report on when I say that we have used the new process for checking claims this week. None of the pickers liked it at all. Some were obviously rebellious. Technically, they have every right to be; I am not anyone’s supervisor. P.B. is their manager.

However, I had talked about this process with P.B. and with his deputies, and sketched the outlines in a departmental meeting. I was dismayed by the frank resistance from the pickers and the initial lack of support from P.B., who, based on the complaints of the workers, wanted to review what it was I proposed to do. He had never gone over it in detail, although I sent him the plan, invited him to discussions, and generally gave him every opportunity to ask for further details or outright veto.

However, when P.B. did review the plan he agreed it met our needs and gave it an official sign-off. For this first week, we replied to claims in a 24-hr period by following a process, rather than a streak of free time to freestyle through them. This is more significant than it feels to me.

In the same vein, my former boss came through the department and remarked that every time he stops by things look better. Credit that to P.B. It is like when long-lost relatives come visiting, and tell all the children they’ve grown tremendously. It doesn’t look like much progress from the front lines, but it adds up over time.

Although I have been pushing this forward an inch at a time while managing to juggle all the other things that come up so far, a new priority has been assigned to me that may be the one more thing that topples this effort from its place in my schedule. Before leaving on a week and a half of vacation, my boss tasked me to investigate and reduce a backlog of items that I already have reason to suspect has built up due to systematic reasons, choices in the way those items are handled through our system that causes our system to think we do not have enough when in fact we do. This is cause by letting our projected demand run ahead of our projected supply, so the system thinks it has to reserve our current supply and won’t dole it out to sales orders.

In other words, if I am right, it is a problem I am already aware of and can’t fix because I don’t have the stature to contramand the decisions that caused the problem; nevertheless, I am tasked with the “solution.” That could effectively divert me from fixing what I can fix to running circles around what I can’t budge.

Speaking of which, our office had the privilige to particpate in a conference call in which we were told that we would be required to implement a new process for orders going across a particular border. We will need to ship these packages as if they are leaving with our small-box carrier, then put them in a big box and ship them with a large-freight carrier, who will take them across the border where the small-box carrier will break open the box and finish the delivery.

This will require special software and quite possibly its own computer, scale, and label printer; no effort or real interest was shown in whether this could be made compatible with our existing softwared. It will occur in spite of the fact that we are already struggling in our site to meet all the different special requirements of various high-profile customers; it will occur in spite of the fact that we have a dubious relationship with the large-freight carrier specified, in spite of the fact that it severely complicates shipment tracking for the small packages that are being big-boxed. It will happen without any consultation with the IT department beyond “make this work.”

It will be done because some bean-counter figured it will save money.

And if there weren’t such things as friction, gravity, and human error, it would work out great.

A week ago, the plan was:

1. Set up at least a basic database to keep track of shipment errors
2. Begin new pick/pack/ship flex program to check shipments
3. Use dougnuts to bring home the program

We didn’t accomplish exactly any of those things. Still, the best-laid plan changes as soon as it gets underway.

I may have cheated a little even putting number one on the list. I think I already had the basic database set up to keep track of number of lines picked (line items on sales orders). I did some twiddling with the data side of it, but not really anything significant until late Saturday when I set up a routine to capture inventory data that will help other projects besides the shipment error reduction. I figure if I accomplished something in overtime, it’s only half a victory at best, because the point is to find a solution other than living in the office.

But most of Saturday was spent cleaning up old claims so that the new system can start from zero. Notwithstanding overtime principle above, this is forward progress in the direction planned. The supervisors of the line pickers are on board.

This next week is going to be a major challenge. We have to try to get Accounting to sign off on a new way of handling the inventory discrepancies. We’ve had dysfunctional process since the previous supervisor left, due partly to the restructuring of the department and the redefinition of the roles. We’ve tried different things at different points during the year and we haven’t set up a seamless process yet. There’s a little communication problem between departments, too, because Accounting keeps asking us for suggested solutions and then mostly telling us that we can’t do what we’ve suggested.

This will probably be the showdown week. Make that this week’s agenda:

• Continue to implement new claim investigation process
• Agree on reconciliation process with Accounting

I’ve been thinking for a while that it is not good for me to only report bad news. The last bit of this post by Michael Yon, about rebuilding Iraq, clinched it. If I am talking about work, I am most often talking about how Acme, or the managment of Acme, or the other departments in Acme, are insurmountable roadblocks to fixing the problems we are having in our particular Acme factory.

I do not subscribe to the doctrines of ignoring the problem, or pretending the problem has less effect than it does, or pretending that we are in the process of solving the problem when we are not. When searching for some good news to report on today, my first thought was that we had met our goal for cost of goods shipped this month–actually that we met the goal before the end of the month, and the goal was increased, and we still exceeded the revised goal. But there are two flaws in this good news. First, we in shipping have very little influence over the cost of goods shipped. We must have an order and the product before we can make a shipment. An order without product is not a shipment. A product without an order is not a shipment. A better goal would be shippable over shipped, the percentage of what we did do against what we could have done.

Second, we received no congratulations, thanks, or recognition for exceeding the last-minute goal. Instead we had a meeting on Friday to discuss why we hadn’t shipped more of the past due orders. We have lots of orders and lots of product, but unfortunately they don’t correspond. The backlog of orders, like the cost of goods shipped, is only slightly influenced by the shipping department.

People in Acme have reported trivial or incidental occurrences as victories, but that is not the kind of good news I am looking for. I want the kind of good news you can put in the bank, not the kind you buy at the cosmetics counter. It ocurred to me that good news is a little like money, in that you don’t usually get it without working for it. There’s enough bad news to go around, and more to spare, but everyone has to make a little good news of their own.

Last week, I thought I had. Shipping errors have been increasing, and P.B. and I have been at a loss to come up with a remedy that does not require more people or a better software system. One idea that we have kicked around for about half a year is to require that a separate person pick and pack each order, so that two sets of eyes check each order. But when someone has vacation or a sick day, we often are down to just two people picking and packing. If either of them happens to be faster than the other, you either have wasted capacity while the picker waits for the packer to catch up (or vice-versa), or you get rid of the rule and let the fast guy pack his own orders.

The solution popped into my head one evening: include the final step, running the package through the shipping software, in the loop. By including all three functions of pick, pack, and ship, and by using two packing stations, it is to keep rotating people so that nobody has to go over their own work (in picking and packing; in shipping, the order is boxed and can’t be checked anyway, so it is fine to ship an order that you have picked or packed).

I was very excited about this idea and wanted to tell everyone about it, but I was diverted that day because that’s when I found out we had to give an accounting on Friday for why we didn’t ship more orders. But diversions and demoralization will always come. They come every day, in fact. So either I concede to the demoralizations and diversions and I either quit or become depressed, or I must plan to overcome or ignore the diversions.

Easier said than done? Of course. But it is the only choice. Either (a) avoid those bad things by leaving, (b) solve them all and do the productive work, (c) take care of only the diversions, (d) take care of only the productive work, or (e) combine (a) and (b), as it were, by ignoring some of them and solving others, as required. (a) is not currently my choice, and (b) is impossible. (c) and (d) are not tolerated by my superiors. P.B., and anyone who has succeeded as a manager, has sometime succeeded in doing what has to be done in the way of emergencies and diversions, while still getting some real work done. That doesn’t dimish the size of the present task. P.B., who has succeeded as a manager in previous jobs with similar challenges, a man with more maturity and experience, more confidence, and more diplomacy than I have, is wearing down in the face of this challenge.

I don’t know the full measure of the man; I don’t know if he will continue to wear down, or if he will bail out, or be run out, or if he will regroup and overcome. I know I certainly won’t manage to accomplish progress without his close participation, and also of at least S.B. and S.D. But I know there won’t be any good news to speak of unless we do come together, measure our performance on things we can control, and make some changes–even if they aren’t the biggest and most effective changes that we can dream up.

So I would like my future posts to be about what we have done, not just what was done to us; and I hope that with that goal in mind, of reporting here on me instead of them, it will help to keep me focused on accomplishing what I set out to do.

Current plan:

1. Set up at least a basic database to keep track of shipment errors
2. Begin new pick/pack/ship flex program to check shipments
3. Use dougnuts to bring home the program

I am a little uncertain about the last item. Something about it strikes me as kitschy. The idea is to use bring in the same percentage of “wrong” donughts as we have wrong shipments, or a translated percentage (for example, a two-percent mis-ship rate could be translated to two wrong donughts, rather than two percent of a dozen). This lets the workers know that we, the office people, are paying attention, and it lets them see, in a relateable way, how good they are doing. I like that. I don’t like the element of condesension, touching on bribery, or really the institutionalization of tainted pleasure like the doughnut.

I need to accomplish at least the first item this week. Hopefully all three, but I am mindful of diversions.

Check back next week.

This is going to get technical, and also not make much sense. Proceed with caution.

One of the first things I had the privilege of working on when I came to the shipping department was intra-company orders. In a very small way I helped make this an issue that our plant needed to deal with. In the preceding autumn we had gone through a campaign to improve our delivery to our original promise date, for which I helped provide the critical data. The campaign was successful enough that other sites in our area, such as regional distribution center, wanted to know what we had done. Ultimately they found their own way to improve and did so even better than we had, to the point that one of their major complaints was sales orders they could not ship because they were waiting for products from our site.

So they came to us saying “You have to ship intra-company orders faster, our customer is waiting on you.” I started looking at the process of shipping intra-company orders and found that, unlike normal sales orders, intra-company orders did not automatically allocate available stock and did not automatically “drop” (that is, print out) for picking and shipping. Instead, the basic process required human intervention to hook individual requests into a shipment and drop the shipment for pick.

Since this cumbersome process was insufficient to meet the volume of requests from the regional distribution center, a special add-on to the system had been created that automatically hooked the requests to a shipment number and then dropped the shipment for pick–but not on the standard picking paperwork. Instead, they printed on “cards” (printer paper that tears into thirds), which the pickers would use to pull the inventory. Unlike the usual pick paperwork, when these cards were printed inventory did not actually allocate to the orders. In other words, while the pickers were physically picking the inventory and packaging it for shipment, the system could be allocating the same parts to be assembled into tools, or shipped on customer orders.

After the pickers were through, a clerk would review what they had picked, adjust the order, and then drop the usual pick paperwork, which was then shipped out with the product without further ado. This “standard” paperwork never matched the actual shipment, because the system had been allocating the inventory while the pickers were at work. When it comes to that, the computer system used here is very poor at tracking inventory anyway. We use inventory faster than we charge it off, we allocate more inventory than we actually have, and, in a particular conjunction of the preceeding, on two specific classes of inventory we are perpetually out of synch because it is accounted for in a special cost-saving way that encourages us to keep as little inventory in our system as possible–which by itself is great, but when your system is not keeping up in real time with what is happening to the inventory, it means that the system can never account for where things are at until we bring the factory to a standstill once a year to do an accounting.

Hence in the shipping department we are very frequently making changes to the inventory picture to allow orders to ship, since the inventory is no longer where it was when the system allocated it to the order. But that is just for the ordinary sales orders that allocate and drop automatically. It is always worse with the intra-company orders, which S. B., one of my compatriots in shipping, always has to correct. The paperwork S. B. deals with is the “standard” pick, dropped after the “card drop”, and it does actually allocate the inventory, but since unlike regular sales orders the intra-company orders to not charge off the inventory when they are run through the shipping software, S. B. must manually issue them. The odious nature of this task is enriched by the fact that, if you will recall, this “standard” picking paperwork doesn’t even reflect what is actually shipping, since not all of it seemed to be available to the system at the time when it actually allocated to the intra-company order (as opposed to the “card drop” that may have been run days earlier). No, the order is not fully shipped until the clerk who adjusted the shipping order to match–well, more closely resemble–the card drop goes back after the fact and cleans up any remaining discrepancies. It is quite possible for the distribution center to receive product before it has been completely processed to show shipping out of our factory.

The items the distribution center wants are the same items that the assembly area wants to build tools and that are being ordered directly by the customer (on sales orders that do automatically allocate and drop). All this competing demand, poorly managed by the plant software, means that orders frequently have to be “shorted” because inventory the system thought was available in fact was not. The process requires several more steps than it should just for sales orders, but intra-company orders are even more finicky; and that is one of the reasons for using the “card drop,” because then the adjustments are about where the inventory is, not whether there is any (those issues having been addressed by the clerk who cleaned up after the card drop).

When we first looked at this process in the first quarter of the year, I concluded that the card drop needed to group fewer requests to a shipping order than the current 200 requests per order, so that the orders did not take so long to pick and left the factory sooner, and that they should be hooked up by date order rather than alphabetical order, and that they should allocate when they were dropped for pick. This was all discussed, but we took care of the immediate problem by putting more manpower into delivering intra-company orders. Meanwhile, the service by the same personnel to supply the assembly lines and the sales orders suffered.

None of the changes I identified were made, because they involved changes to the system. That requires a system change request, which apparently are put into glass bottles and thrown into the sea to go to India.

In the time between then and now, some small things were done to try to help the situation. First, the report I created last fall to show show unfilled customer orders due to our original commitment (something you would have thought our official software could readily provide, but no) was expanded to also show the intra-company demand. This was not a trivial change, since the information on intra-company orders is stored in different tables and has only a similar, not identical, set of data; but I did it so that if I was asked why we weren’t shipping something and I said we had none to ship, I could also say with good cause that the production planners were aware of the need for the parts.

Second, directly after the lay-off-the-temps scare, we were given a set of college interns to help in our department, and two of them were assigned to help with the intra-company orders. One has been dropping smaller orders on the standard paperwork, by due date, and one has been picking those orders. Generally this has been and improvement, except that the intern is using a report of mine that actually takes into account the system allocation before hooking orders, so where previously we had been blithely picking and shipping the product that the system, on the whole, would not have thought we could ship, now we have not been.

But this has not been enough. When it was announced that there would be a multi-site team effort to improve the delivery between our factory and the distribution center, a manager about four or five levels down from the top of the international company volunteered to be on the team. He and a bunch of people from the distribution center came to our factory to help us figure out how to do our job.

The first and most disconcerting thing we learned was that the distribution center was measuring our performance based on how many customer orders they could not fill because of us. While this simple measurement was admirably customer-focused, it did not give us any indication of what we could control or improve. On top of that, the intra-company requests, if left to themselves, are always planned from the current date–if they are not filled when first intended to be, they simply bump forward. This can be curtailed by “firming” the request, which makes its due date permanent. However, the requests from the distribution center are based not only on actual customer orders, but also anticipated customer orders and the current stock level in the distribution center. Unexpectedly run out of stock in the distribution center, and the request to our site is increased. Do not receive all the anticipated customer orders, and the request to our site is decreased. By the time we are ready to ship the product, in other words, the distribution center may need more or less than the original request.

Worst of all, one of the most vocal representatives wanted to dispense with the firming of the intersites (so that her staff would not have to adjust them) and let the orders continuously and dynamically change until such time as we dropped the order for pick. It would then be impossible for us to say how long we had been aware of a need in the distribution center, as the date would constantly bump forward, and impossible to know how much and what product we would really have to ship ahead of time.

The planning manager at our site actually liked this idea, as he would not have to deal with numerous trivial past-due intra-company orders, but could ship one nice big one whenever he was ready. I opposed it because it left us without any responsibility–completely liable for blame if we were late, completely without meaningful proof if we had peformed well. In the end a compromise was reached, wherein at least the items shipping is directly responsible for will be given fixed dates.

Other than that, we mainly concluded that the intersites should be dropped a few at a time, in date order, allocating at the time of drop. Exactly what I had already figured out. However, neither the fourth-level manager nor the regional IT representative had anything encouraging to say about the chance of the system change request getting completed; apparently the people who actually make the changes are responsible to almost nobody. Without a doubt, the few people permitted to make changes have more work than they can handle; but in this case the “customer” is us, the sites generating saleable product, and their responsibility to the “customer” approaches zero.

We did also try to set up another “exception” process, whereby those items which are on the factory property but owned by the supplier until we pull them out for use–items constantly showing fewer in the system than actually, practically available–will be moved into yet another metaphorical inventory location that exists for the purpose of enabling the system to deal with it. This process may just need time to work out the kinks, but it is not off to a good start.

About all that was really gained, then, was those folks from the distribution center remarking, “I never knew how hard it was for you guys to ship product too us. I’ll never complain again.”

The last, of course, cannot be taken seriously, but it was gratifying to hear.

Two people inside of Acme applied for the job that P. B. now holds–two people that I know of. As of today, neither of them works for the company any more. The second gave two weeks’ notice today and was asked to leave immediately. Lots of things are rumored, the most likely that he had a surly and defiant attitude knowing that he had his ticket.

It does not make the best impression to get rid of someone that quickly. Now we can all imagine him as some kind of hero. If we had all seen him being a jerk, we would know he got what he deserved. One of the less credible rumors about his immediate dismissal is that his continued presence would be bad publicity. . .or something. . . to the effect that too many people are leaving and we don’t want it to catch.

Just about bolted for the door myself when I heard that one. Fortunately I have successfuly developed a third brain cell at some point in my life and I sniffed around a little more before getting carried away. Like I said, it was not really the most credible rumor.

The first guy to go (related to this position) spent his last two weeks telling us how much more he would be paid, and how his new employers thought he was overworked, and how he couldn’t wait to stick it to Acme. He had gotten a degree on the benefience of Acme, but evidently it did not make him qualified enough for the job.

I can see why. A week after he left he called back for his old job because the new one was too hard. Apparently the same drama was staged during his last attempt at a change of functions with Acme.

We are finally to have a production manager again. This fellow used to work for Acme, at some time sufficiently before my time that I don’t know what he did. He most recently worked for an old sister-company of Acme, but that one was split off ages ago. It’s the company where the person who used to have P. B.’s job, more or less, left to work for. She mentioned that she would be glad to work with this guy who is now rejoining Acme.

I can imagine, though without any information to back me up, that he left partly to put some distance back into their friendship, as the last I heard this old supervisor was driving coworkers bonkers by continuing to answer the phones “Acme Tool Co., how may I help you?”

Oh well, after 20 or 30 years, who can blame you for getting in a rut.