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Take a Spin with Toyota--Dickeson

January 2005
There's TPS, the Toyota Production System, and LEAN Manufacturing, which are basically development ideas of Taiichi Ohno of Toyota. Then there's the Six Sigma System strongly espoused by Jack Welch of General Electric, and The Great Game of Business, developed to a fine art by Jack Stack. If that isn't enough, add in ABC, Activity Based Costing, thought by some to be the answer to a maiden's prayer for manufacturing.

By the way, don't forget TOC, the Theory of Constraints, by Eliyahu Goldratt. Also don't overlook SQC, Statistical Quality Control of W. Edwards Deming, for continuing improvement of manufacturing. Oops, we almost forgot to mention Don Wheeler and his Understanding Variation touting the usefulness of XmR charting. There are probably a dozen more that we've omitted!

Then there are the 30,000-plus commercial printing industry shops and the 60 or more suppliers of computer systems. These plants and suppliers rely on the centuries old, double-entry general ledger system, coupled with the deceptive single-entry cost accounting scheme of BHR, Budgeted Hourly Rates. These cost schemes are derivatives of the systems developed for General Motors' Sloan and others in the early 20th century to assist mass production control.

All of these have a common objective: to improve the productivity of manufacturing. They purport to do this by providing some form of statistical base for people to make better decisions. These decisions come down to influencing physical actions of people, most often the people doing the actual work of adding a value to raw materials to make a finished product.

Election of the particular system to use for influencing the physical action of workers in a manufacturing plant seems to be a conscious, or oftentimes unconscious, decision of top management of a plant or company. Usually these decisions have been in place long enough to have become the "culture of the group"— the paradigm of "the way we do things here." Often, months, maybe even years, are required to change a culture that has become habit.

Even when a new top dog takes over or a merger occurs, the culture of the company goes on, just as it has, for years. It's tough, and takes time to shift the way people have made decisions. Mergers quite often fail to achieve synergies planned because of the entrenched cultures of disparate companies.

Do You Know Jack?

Take Jack Stack's scheme of involving plant people in the financial reporting of companies. Think you could get that idea across in a printing company? Especially a company run by an old guy who's held the numbers close to his vest all these years? Or a company run by the child or children of the founder who have that parent for a model?
 

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