The Goal: A Process of Ongoing Improvement, page 11
"How about scrap?’’ he asks.
"That’s operational expense, too.’’
"Yeah? What about what we sell to the scrap dealer?’’
"Okay, then it’s the same as a machine,’’ says Lou. "Any money we’ve lost is operational expense; any investment that we can sell is inventory.’’
"The carrying costs have to be operational expense, don’t they?’’ asks Stacey.
Lou and I both nod.
Then I think about the "soft’’ things in business, things like knowledge—knowledge from consultants, knowledge gained from our own research and development. I throw it out to them to see how they think those things should be classified.
Money for knowledge has us stumped for a while. Then we decide it depends, quite simply, upon what the knowledge is used for. If it’s knowledge, say, which gives us a new manufacturing process, something that helps turn inventory into throughput, then the knowledge is operational expense. If we intend to sell the knowledge, as in the case of a patent or a technology license, then it’s inventory. But if the knowledge pertains to a product which UniCo itself will build, it’s like a machine—an investment to make money which will depreciate in value as time goes on. And, again, the investment that can be sold is inventory; the depreciation is operational expense.
"I got one for you,’’ says Bob. "Here’s one that doesn’t fit: Granby’s chauffeur.’’
"What?’’
"You know, the old boy in the black suit who drives J. Bart Granby’s limo for him,’’ says Bob.
"He’s operational expense,’’ says Lou.
"Like hell he is! You tell me how Granby’s chauffeur turns inventory into throughput,’’ says Bob, and looks around as if he’s really got us on this one. "I bet his chauffeur doesn’t even know that inventory and throughput exist.’’
"Unfortunately, neither do some of our secretaries,’’ says Stacey.
I say, "You don’t have to have your hands on the product in order to turn inventory into throughput. Every day, Bob, you’re out there helping to turn inventory into throughput. But to the people on the floor, it probably looks like all you do is walk around and make life complicated for everyone.’’
"Yeah, no appreciation from nobody,’’ Bob pouts, "but you still haven’t told me how the chauffeur fits in.’’
"Well, maybe the chauffeur helps Granby have more time to think and deal with customers, etc., while he’s commuting here and there,’’ I suggest.
"Bob, why don’t you ask Mr. Granby next time you two have lunch,’’ says Stacey.
"That’s not as funny as you think,’’ I say. "I just heard this morning that Granby may be coming here to make a video tape on robots.’’
"Granby’s coming here?’’ asks Bob.
"And if Granby’s coming, you can bet Bill Peach and all the others will be tagging along,’’ says Stacey.
"Just what we need,’’ grumbles Lou.
Stacey turns to Bob. "You see now why Al’s asking questions about the robots. We’ve got to look good for Granby.’’
"We do look good,’’ says Lou. "The efficiencies there are quite acceptable; Granby will not be embarrassed by appearing with the robots on tape.’’
But I say, "Dammit, I don’t care about Granby and his videotape. In fact, I will lay odds that the tape will never be shot here anyway, but that’s beside the point. The problem is that everybody—including me until now—has thought these robots have been a big productivity improvement. And we just learned that they’re not productive in terms of the goal. The way we’ve been using them, they’re actually counterproductive.’’
Everyone is silent.
Finally, Stacey has the courage to say, "Okay, so somehow we’ve got to make the robots productive in terms of the goal.’’
"We’ve got to do more than that,’’ I say. I turn to Bob and Stacey. "Listen, I’ve already told Lou, and I guess this is as good a time as any to tell the both of you. I know you’ll hear it eventually anyhow.’’
"Hear what?’’ asks Bob.
"We’ve been given an ultimatum by Peach—three months to turn the plant around or he closes us down for good,’’ I say.
Both of them are stunned for a few moments. Then they’re both firing questions at me. I take a few minutes and tell them what I know—avoiding the news about the division; I don’t want to send them into panic.
Finally, I say, "I know it doesn’t seem like a lot of time. It isn’t. But until they kick me out of here, I’m not giving up. What you decide to do is your own business, but if you want out, I suggest you leave now. Because for the next three months, I’m going to need everything you can give me. If we can make this place show any progress, I’m going to go to Peach and do whatever I have to to make him give us more time.’’
"Do you really think we can do it?’’ asks Lou.
"I honestly don’t know,’’ I say. "But at least now we can see some of what we’re doing wrong.’’
"So what can we do that’s different?’’ asks Bob.
"Why don’t we stop pushing materials through the robots and try to reduce inventories?’’ suggests Stacey.
"Hey, I’m all for lower inventory,’’ says Bob. "But if we don’t produce, our efficiencies go down. Then we’re right back where we started.’’
"Peach isn’t going to give us a second chance if all we give him is lower efficiencies,’’ says Lou. "He wants higher efficiencies, not lower.’’
I run my fingers through my hair.
Then Stacey says, "Maybe you should try calling this guy, Jonah, again. He seems like he’s got a good handle on what’s what.’’
"Yeah, at least we could find out what he has to say,’’ says Lou.
"Well, I talked to him last night. That’s when he gave me all this stuff,’’ I say, waving to the definitions on the board. "He was supposed to call me...’’
I look at their faces.
"Well, okay, I’ll try him again,’’ I say and reach for my briefcase to get the London number.
I put through a call from the phone in the conference room with the three of them listening expectantly around the table. But he isn’t there anymore. Instead I end up talking to some secretary.
"Ah, yes, Mr. Rogo,’’ she says. "Jonah tried to call you, but your secretary said you were in a meeting. He wanted to talk to you before he left London today, but I’m afraid you’ve missed him.’’
"Where is he going to be next?’’ I ask.
"He was flying to New York. Perhaps you can catch him at his hotel,’’ she says.
I take down the name of the hotel and thank her. Then I get the number in New York from directory assistance, and expecting only to be able to leave a message for him, I try it. The switchboard puts me through.
"Hello?’’ says a sleepy voice.
"Jonah? This is Alex Rogo. Did I wake you?’’
"As a matter of fact, you did.’’
"Oh, I’m sorry—I’ll try not to keep you long. But I really need to talk to you at greater length about what we were discussing last night,’’ I tell him.
"Last night?’’ he asks. "Yes, I suppose it was ‘last night’ your time.’’
"Maybe we could make arrangements for you to come to my plant and meet with me and my staff,’’ I suggest.
"Well, the problem is I have commitments lined up for the next three weeks, and then I’m going back to Israel,’’ he says.
"But, you see, I can’t wait that long,’’ I say. "I’ve got some major problems I have to solve and not a lot of time. I understand now what you meant about the robots and productivity. But my staff and I don’t know what the next step should be and . . . uh, well, maybe if I explained a few things to you—’’
"Alex, I would like to help you, but I also need to get some sleep. I’m exhausted,’’ he says. "But I have a suggestion: if your schedule permits, why don’t I meet with you here tomorrow morning at seven for breakfast at my hotel.’’
"Tomorrow?’’
"That’s right,’’ he says. "We’ll have about an hour and we can talk. Otherwise...’’
I look around at the others, all of them watching me anxiously. I tell Jonah to hold on for a second.
"He wants me to come to New York tomorrow,’’ I tell them. "Can anybody think of a reason why I shouldn’t go?’’
"Are you kidding?’’ says Stacey.
"Go for it,’’ says Bob.
"What have you got to lose?’’ says Lou.
I take my hand off the mouthpiece. "Okay, I’ll be there,’’ I say.
"Excellent!’’ Jonah says with relief. "Until then, good night.’’
When I get back to my office, Fran looks up with surprise from her work.
"So there you are!’’ she says and reaches for the message slips. "This man called you twice from London. He wouldn’t say whether it was important or not.’’
I say, "I’ve got a job for you: find a way to get me to New York tonight.’’
11
But Julie does not understand.
"Thanks for the advance notice,’’ she says.
"If I’d known earlier, I’d have told you,’’ I say. "Everything is unexpected with you lately,’’ she says. "Don’t I always tell you when I know I’ve got trips coming up?’’
She fidgets next to the bedroom door. I’m packing an overnight bag which lies open on the bed. We’re alone; Sharon is down the street at a friend’s house, and Davey is at band practice.
"When is this going to end?’’ she asks.
I stop midway through taking some underwear from a drawer. I’m getting irritated by the questions because we just went over the whole thing five minutes ago. Why is it so hard for her to understand?
"Julie, I don’t know.’’ I say. "I’ve got a lot of problems to solve.’’
More fidgeting. She doesn’t like it. It occurs to me that maybe she doesn’t trust me or something.
"Hey, I’ll call you as soon as I get to New York,’’ I tell her. "Okay?’’
She turns as if she might walk out of the room.
"Fine. Call,’’ she says, "but I might not be here.’’
I stop again.
"What do you mean by that?’’
"I might be out someplace,’’ she says.
"Oh,’’ I say. "Well, I guess I’ll have to take my chances.’’
"I guess you will,’’ she says, furious now, on her way out the door.
I grab an extra shirt and slam the drawer shut. When I finish packing, I go looking for her. I find her in the living room. She stands by the window, biting the end of her thumb. I take her hand and kiss the thumb. Then I try to hug her.
"Listen, I know I’ve been undependable lately,’’ I say. "But this is important. It’s for the plant—’’
She shakes her head, pulls away. I follow her into the kitchen. She stands with her back to me.
"Everything is for your job,’’ she says. "It’s all you think about. I can’t even count on you for dinner. And the kids are asking me why you’re like this—’’
There is a tear forming in the corner of her eye. I reach to wipe it away, but she brushes my hand aside.
"No!’’ she says. "Just go catch your plane to wherever it is you’re going.’’
"Julie—’’
She walks past me.
"Julie, this is not fair!’’ I yell at her.
She turns to me.
"That’s right,’’ she says. "You are not being fair. To me or to your children.’’
She goes upstairs without looking back. And I don’t even have time to settle this; I’m already late for my flight, I pick up my bag in the hall, sling it over my shoulder, and grab my briefcase on my way out the door.
At 7:10 the next morning, I’m waiting in the hotel lobby for Jonah. He’s a few minutes late, but that’s not what’s on my mind as I pace the carpeted floor. I’m thinking about Julie. I’m worried about her... about us. After I checked into my room last night, I tried to call home. No answer. Not even one of the kids picked up the phone. I walked around the room for half an hour, kicked a few things, and tried calling again. Still no answer. From then until two in the morning, I dialed the number every fifteen minutes. Nobody home. At one point I tried the airlines to see if I could get on a plane back, but nothing was flying in that direction at that hour. I finally fell asleep. My wake-up call got me out of bed at six o’clock. I tried the number twice before I left my room this morning. The second time, I let it ring for five minutes. Still no answer.
"Alex!’’
I turn. Jonah is walking toward me. He’s wearing a white shirt—no tie, no jacket—and plain trousers.
"Good morning,’’ I say as we shake hands. I notice his eyes are puffy, like those of someone who hasn’t had a lot of sleep; I think that mine probably look the same.
"Sorry I’m late,’’ he says. "I had dinner last night with some associates and we got into a discussion which went, I believe, until three o’clock in the morning. Let’s get a table for breakfast.’’
I walk with him into the restaurant and the maitre d’ leads us to a table with a white linen cloth.
"How did you do with the measurements I defined for you over the telephone?’’ he asks after we’ve sat down.
I switch my mind to business, and tell him how I expressed the goal with his measurements. Jonah seemed very pleased.
"Excellent,’’ he says. "You have done very well.’’
"Well, thanks, but I’m afraid I need more than a goal and some measurements to save my plant.’’
"To save your plant?’’ he asks.
I say, "Well... yes, that’s why I’m here. I mean, I didn’t just call you to talk philosophy.’’
He smiles. "No, I didn’t think you tracked me down purely for the love of truth. Okay, Alex, tell me what’s going on.’’
"This is confidential,’’ I say to him. Then I explain the situation with the plant and the three-month deadline before it gets closed. Jonah listens attentively. When I’ve finished, he sits back.
"What do you expect from me?’’ he asks.
"I don’t know if there is one, but I’d like you to help me find the answer that will let me keep my plant alive and my people working,’’ I say.
Jonah looks away for a moment.
"I’ll tell you my problem,’’ he says. "I have an unbelievable schedule. That’s why we’re meeting at this ungodly hour, incidentally. With the commitments I already have, there is no way I can spend the time to do all the things you probably would expect from a consultant.’’
I sigh, very disappointed. I say, "Okay, if you’re too busy—’’
"Wait, I’m not finished,’’ he says. "That doesn’t mean you can’t save your plant. I don’t have time to solve your problems for you. But that wouldn’t be the best thing for you anyway—’’
"What do you mean?’’ I interrupt.
Jonah holds up his hands. "Let me finish!’’ he says. "From what I’ve heard, I think you can solve your own problems. What I will do is give you some basic rules to apply. If you and your people follow them intelligently, I think you will save your plant. Fair enough?’’
"But, Jonah, we’ve only got three months,’’ I say.
He nods impatiently. "I know, I know,’’ he says. "Three months is more than enough time to show improvement ...if you are diligent, that is. And if you aren’t, then nothing I say could save you anyway.’’
"Oh, you can count on our diligence, for sure,’’ I say.
"Shall we try it then?’’ he asks.
"Frankly, I don’t know what else to do,’’ I say. Then I smile. "I guess I’d better ask what this is going to cost me. Do you have some kind of standard rate or something?’’
"No, I don’t,’’ he says. "But I’ll make a deal with you. Just pay me the value of what you learn from me.’’
"How will I know what that is?’’
"You should have a reasonable idea after we’ve finished. If your plant folds, then obviously the value of your learning won’t have been much; you won’t owe me anything. If, on the other hand, you learn enough from me to make billions, then you should pay me accordingly,’’ he says.
I laugh. What have I got to lose?
