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Is the Glass Half-Full or Half-Empty?

Michael Roman - Wednesday, February 10, 2016

I am in the midst of a conundrum. Clients ask me to analyze, assess, and recommend changes for improvement opportunities in their company processes. My findings, at times, shock business owners and company managers.

I educated myself in the Body-of-Knowledge for my field. I trained to become a Management Consultant, tutored by the industry experts. I maintain credentials for my field (APICS Certification and now am on the APICS ECO Committee). I have been doing Management Consulting for thirty plus years. So, why are clients shocked by the findings? After all, they ask for the analysis. I muse about this conundrum daily, sometimes when I should be asleep.

I was reading a magazine recently called, Korn Ferry Briefings. An article on Optimists and Pessimists caught my eye. The article by David Berreby suggests that situationally people are either Optimistic or Pessimistic. It reminded me of a Graduate School conversation with my Major Professor, Dr. Kelly Wells. I was in the final weeks of my Masters Work, having passed my orals and written exams and was preparing to defend my thesis paper on eye blinks (we found high correlation between eye blinks and memory types).  After some discussions, Dr. Wells asked me, “Have you always been someone who sees three sides to a coin?” I said, “If you mean when someone asks me if the glass is half-full or half- empty and I reply, well, maybe the glass is just too big, then I guess so, you brought that out in me.” He smiled and rolled his eyes!

There is something at work, within the minds of clients, when I arrive on the scene. Maybe their Optimist-Pessimist tendencies appear. Maybe they see the glass as half full and my findings threaten their inner-peace. Maybe they see the glass as half-empty and my findings goes further to threaten their inner-peace. Why do people who ask for assistance become defensive when a report states, ‘improvements in these activities will contribute to the bottom line’?

Mr. Berreby’s article supports the “inside the mind” idea. Both Optimistic and Pessimistic approaches have benefits and drawbacks.  Where Optimists see the long-range benefits, Pessimists see many dangers in activities. Optimists often fail in careful planning; Pessimists often encounter analysis paralysis.  Optimists take the ‘damn the torpedoes, full speed ahead approach’ while Pessimists fear missteps. When Optimists succeed, the cost is sometimes detrimental to the organization. When Pessimists succeed, the chosen path is sometimes very stressful to those who execute the plan. Regardless of which personality type sits in the C-Suites, Management Consultants have the skill-sets and tool-sets to assist organizations pass the challenges of Change Management.

What are your thoughts?

ERPOrchestrationII

Michael Roman - Wednesday, January 13, 2016

Re-introduced from an old blog…

A long, long time ago, William Congreve, in The Mourning Bride, (1697) wrote:

Musick has Charms to sooth a savage Breast,
To soften Rocks, or bend a knotted Oak.
I've read, that things inanimate have mov'd,
And, as with living Souls, have been inform'd,
By Magick Numbers and persuasive Sound.
What then am I? Am I more senseless grown
Than Trees, or Flint? O force of constant Woe!
'Tis not in Harmony to calm my Griefs.
Anselmo sleeps, and is at Peace; last Night
The silent Tomb receiv'd the good Old King;
He and his Sorrows now are safely lodg'd
Within its cold, but hospitable Bosom.
Why am not I at Peace?

Three hundred and fifteen years after their penning, these soulful, pleading words have application today, even in consulting work.  I frequently work with small and mid-sized manufacturing and distribution organizations facing the lack of “Harmony to calm my (their) Griefs.”  I hear less poetic words from company owners and managers who are attempting to re-implement a business management system, but the sentiment is the same: Why am not I at Peace?

In my never-ending search to find the best way to describe the challenges of any ERP implementations, I have used comparisons as obscure and varied as death and dying or growing tomatoes. What would a successful stress-free implementation look like? My business adviser suggested we needed a better way to paint that picture, something that explains how there can be synergy and harmony among all the players. A couple of days later, when I was discussing analogies with a colleague of mine, I digressed by talking about the fact that when we weren’t fighting, my brother and I enjoyed a remarkable harmony when we played musical instruments together.

At an early age, when we were not fighting in the back yard, my brother Dan and I learned to play musical instruments. We practiced hard, and it did not take long for us to become skilled enough to play duets at the yearly church festival. Those duets were very intricate works, arranged by our father, and the experience taught Dan and me a lesson about how important learning your individual part is to the success of the group as a whole. Unlike playing in a band or an orchestra, having only two of us in the group meant there was no place to hide if one of us hit a dissonant note. Of course, even during an orchestral performance, a good conductor will recognize who hit the dissonant note. The lesson here is that, in any organization, everyone should learn, practice and perform their part without introducing dissonance into the mix of work. When we played well together, my brother and I found a peaceful harmony that was a sharp contrast to our tussles in the back yard. We made beautiful music.

Unfortunately, we don’t see that very often in many small and mid-size manufacturing operations. Dominant personalities (the squeaky wheel gets the oil), tend to rule the workplace, which leads to more disharmony through the organization.  What an organization facing that kind of challenge needs are:

  1. Leadership
  2. A business management tool that provides the leadership team with “state of the union” information

An ERP System is that proper business management tool, but just as an orchestra needs a good conductor, a properly managed ERP implementation needs a strong and capable leader, a conductor with a good ear who can identify where the dissonance originates. The orchestra conductor orchestrates playing of the notes, and at what tempo or volume. Likewise, the business owner needs to make sure his “musicians” are all well-informed, proficient with their “instruments,” and working in harmony with other departments and individuals in the organization.  The ERP System represents the notes on the sheet music.  Just as musicians play the notes written on the musical score, company employees must understand the roles defined by the ERP System, under the leadership of the conductor.

The benefits of a harmonious ERP system are numerous. Some of the specific successes I have witnessed include reducing the quote process time; increasing inventory turns; increasing plant throughput;  reducing the quote-to-cash cycle time; increasing percent-fill on customer shipments; and increasing the on-time customer shipments. In a properly implemented business management system, even the time given to creating management reports is reduced, simply because all the pieces are in place to get the reports directly from the ERP system instead of creating spreadsheets that pull data from various and independent sources into a reporting scheme.

So think of your organization as an orchestra, and know that regardless of personalities, internal squabbles, or tussles in the backyard, a well-orchestrated operation will flourish as long as leadership keeps everyone focused on their individual assignments and roots out any dissonance before it ruins the performance.

 

What Makes a Good Client?

Michael Roman - Wednesday, September 30, 2015

By Jerry Tiarsmith, VP Operations

I have three rules: Do the right thing, do the best you can, and always show people that you care.

 -  Lou Holtz 

Earlier this month, Mike and I went to a potential client site. During discussions with Mike, the company president said he read Mike’s comments on ITToolbox and a recent blog I wrote. That blog was, “ What makes a Good Consultant”.  We were eager to do our look around to learn whether we could help.

Our no-fee Gemba Walk took several hours and initial assessment findings coincided with the president’s undisclosed beliefs. The president then hired us to present a five-day ERP education program to the management team. Additionally, we held two days of informal education for employees to explain the importance of an ERP system implementation and their involvement. Clients who see education as the critical first step to improve operations excellence for their organization enjoy greater success. 

C-Suite commitment helps increase employee engagement as a basic rule.  This company’s employees enjoy that level of support. Initial skepticism quickly gave way to active involvement early in the education process. 

  • On day two, the group asked questions, clarified concepts, and began to speak a common language 
  • On day three, they challenged us and engaged one another non-stop for more than 45 minutes 
  • On day four, the team shared process improvement ideas and redefined their roles and responsibilities 

We discussed Policies, Processes, and Procedures as well as performance metrics on the fifth day. At Manufacturing Practices, Inc., we use the expression Keeping People Involved™ when addressing Key Performance Indicators (KPIs) and this management team really understands that. 

 As part of the Keeping People Involved™ presentation, I introduced the Lou Holtz quote. It generated significant and impactful discussions. The management team whole-hardheartedly adopted itMore importantly, the company president reiterated it at each employee session! 

As a veteran owned and veteran staffed organization, we continue to support those we work with; only now, we call them successful clients! 

Dream Big

Michael Roman - Monday, September 07, 2015

Here is one from the archives...

We Stopped Dreaming

The driving force that led me to become a Management Consultant was a simple idea: Dream bigger. The big moment of realization for me happened at a rather comical lunch meeting with my boss at the time, the company’s owner, who wanted to discuss a problem we had with missing shipping dates for a new customer. The Chinese restaurant where we met was a favorite of mine and not far from the plant, and my boss had reluctantly agreed to go there even though he was leery of eating “different” food, especially Asian.

We arrived just as a supply truck passed by and pulled around to the back of the restaurant. We entered the establishment, and I introduced my boss to the owner. She directed us to a quiet area not far from the kitchen, and my boss was noticeably nervous about the place. I assured him not to worry because their food was fresh and delicious. We focused in on the discussion, and I explained the engineering problem that caused the order to ship late, as well as the best way to avoid the problem in the future. Satisfied with my assessment, he acknowledged how much he appreciated my ability to get to the point quickly and explain the situation in a simple and concise fashion. He then added that my work ethic was inspirational, especially in light of the fact that I was not really a part of the “wealth stream of the business.” I asked him to explain what that meant, and he replied, “You are not family or one of the company’s lifelong friends, so you will never get to share in the wealth that we have planned for our retirement years.”

I was speechless for a moment, and then said, “I thought there was enough opportunity to include all of the company’s employees in the wealth stream”. He replied that it was simply impossible to do so, that it was his mission to ensure that this small group of stakeholders had a comfortable future.

At that moment, the server came through the kitchen door with our meal, followed by the chef who was chasing a cat with a meat clever and shouting at it in Chinese. The look on my boss’ face was priceless. He immediately arose and said, “I’m leaving. Fresh cat is not in my diet.” He headed for the door, and I stifled my laughter as I left money to pay for the meal and followed him out. The owner stopped me to apologize and explain that the cat snuck in while they were unloading supplies from the delivery truck. I told her it was okay and suggested she may want to institute a policy not to accept supplies during the lunch or dinner rush.

I was reminded of this true story a few days ago while I was watching Neil deGrasse Tyson’s videos on YouTube. It is entitled “We Stopped Dreaming Part 1” and “We Stopped Dreaming Part 2”and is worth a few minutes of your time to watch and consider. I left that company shortly after that incident, because I realized that the owner’s dreams for his company were too small to include rewards for the very people who were most responsible for his success.

Today, my goal when working with companies is to help them dream big. The odds of properly implementing an ERP System increase proportionally with the commitment of C-Level people and with dedicated involvement of the user community. As my business adviser so often and simply states, “A company can't stop dreaming. It has to take bold steps. It has to become a team with a bold mission. It cannot rest on its laurels and wait to see what everybody else does before taking a new step forward.” And he is absolutely correct!

In my opinion, the best motivator is to help everyone see a bright future. Let them know that the future is brightest when the organization unites around a common goal and all the players are doing their part to focus the company around that goal. That is what ERP systems are all about, helping people in different departments of an organization come together to manage the business better and build the business to the point that everyone can reap the rewards.

Don’t stop dreaming, and don’t let your dreams be small. Dream big, and include everybody in that dream.

 

 

 

 

 

 

What Makes a Good Consultant

Michael Roman - Wednesday, July 15, 2015

By Jerry Tiarsmith VP Operations, Manufacturing Practices, Inc.

Peter Block, author of Flawless Consulting, describes consultant as “a person in a position to have some influence over an individual, a group, or an organization but has no direct power to make changes or implement programs.” I am relatively new to the world of consulting. I have over four decades of varied experience in a number of organizational settings and cannot recall one time when I actually used a consultant. However, in certain situations, due to my position within an organization, I acted as an internal consultant on matters related to the support of strategy and operations to the organizational management team. Too many clients and prospects with whom I interact often express negative sentiments about consultants. Even my mentor, with over thirty years in his field, describes his role as a Business Capabilities Architect, preferring that distinction to one of mere consultant.

At a recent breakfast meeting with my mentor, I began asking a series of questions to which he responded, “Excellent question! Now go write a blogpost.” So here I am.  Many blogs offer advice on methodologies, the importance of adopting new technologies or modernizing plant equipment. All of these represent a valuable exchange of ideas and foster significant discussion. I am writing to invite discussion but I offer no new insight or solutions to difficult themes. Simply put, I ask the question, “What makes a good consultant?” I would like to hear from experienced consultants but only those who operate in a similar space of working with closely held, small- to mid-sized manufacturing and distribution companies. By that, I mean companies with $35 - $500M in annual revenues. Business owners in that space can provide a unique (and much valued) perspective on what they think make a good consultant. Beauty, after all, is in the eye of the beholder.

In the interest of full disclosure, I am the Vice President of Operations of a small veteran owned and veteran staffed firm in the Greater Atlanta area. Our consultants hold APICS certifications in Production and Inventory Management (CPIM) or Supply Chain Professional (CSCP). The logic systems of ERP System platforms incorporate the APICS Body of Knowledge (BOK). With extensive understanding of that particular BOK, we help optimize client’s business management systems. It is a competitive, cluttered, and confusing space full of bogus claims and a trail of broken promises. We get it. Our prospects have spent countless dollars and hours in attempts to seek a competitive advantage by installing ERP Systems, the vast majority with little success. Of course, they remain skeptical and wary of consultants.

We remain very aware that these problems described above often prove self-inflicted. Clients focus too much on cost verses capabilities (and specific needs). They lack a strategic focus to their business and decision-making processes, and, all too often, they allocate inadequate resources to ensure the successful implementation of their business management systems. We certainly can help resolve those situations and, if not prevent such developments at least reduce the negative impact on the company. 

So, what makes a good consultant? Please respond to me at either my LinkedIn page (linkedin.com/in/jerrytiarsmith) or e-mail: jerry.tiarsmith@manufacturingpractices.com. 

But Your Duck is STILL DEAD

Michael Roman - Tuesday, May 19, 2015

There is a page on the Manufacturing Practices website that has been there for about five years. It tells the story of a company that called asking for an opinion about interfacing their "Job Management Tool" to an ERP System. Their goal was to use the accounting piece of that system. Here is the link: I'm Sorry But Your Duck Is Dead.

I won't drag out the issues involved, but suffice it to say that they contracted for remote custom education to help them better understand what an ERP System is and is not and what the ERP System will do for them and TO THEM. The effort was a success. The son and the feisty business owner who thought the proposal was "outrageous since I did not EVEN know their business" (his words, not mine) signed the note.

During the education, we explained why KPIs were more than Key Performance Indicators and why we refer to them as “Keeping People Involved®.” Many benefits were automatic outcomes of that education including, proper Forecasting, Forecast Error measurements, Cycle Counting efforts, On Time Shipments, Throughput Improvements, Project Management considerations, and Leadership requirements during and after the ERP Implementation. You know, those things that make manufacturing companies competitive in the marketplace instead of, “oh yes, by the way, we also make things.”

The thank you letter did not come immediately after the class; it was months after they started using that ERP System that the letter came. By sending the letter, they were saying that we truly helped make them successful.

I remember my first argument about the role of education; it came when I was a programmer at Control Data, writing an MRPII System for mini-computers. The education effort involved having other peers (programmers) review the LOGIC, produced before the code writing. What a stupid idea, I rationalized, I’ve been programming for more than 6 years, why should I have to think about what I am about to do before I do it. The ANSWER came when management asked us to write a program to put a Bill-of-Materials and put all the parts in a table arranged by Low-Level-Code.

Half of the group just wrote code for the request and half the group did it the “new way.” My program was 100+ lines of code long, which was about half way between the upper and lower number of lines of code for others in the first group. The ‘other group’, as a team, wrote the program in ten lines of code after creating the proper logic to deploy to write the code.

The real shocker really came with our tests. Where our group did not have a “successful” first run attempt with test data, the other group did. With that, both groups saw the reasoning behind management’s desire for us to think first, and only after that, act. Our “ready, fire, aim,” quickly became, “ready.., aim.., fire.” When Manufacturing Practices, suggests that companies understand what ERP is before they look for, implement or re-implement an ERP System, we teach them the lesson of “ready.., aim.., fire.”

Here is a take away. Business owners and C-Suites must constantly monitor the expense of education against an investment in their people. Businesses have no way to measure the accumulative costs of remaining complacent. However, by failing to invest in people, leaders assume absolute business risk and at best, the possible loss of any competitive advantages. As Ralph Waldo Emerson said, "The mind, once stretched by a new idea, never returns to its original dimensions." 


LIVING WITH (and Surviving) A COMLEX WORLD

Michael Roman - Wednesday, May 06, 2015
By Jerry Tiarsmith, VP Operations, Manufacturing Practices, Inc.

The way we live, work, and play describes an environment that experiences a constant state of change and reflects an ever-growing increase in complexity. These changes, or external stimuli, require each of us, individually and collectively, to react―to improvise, adapt, and overcome―on a daily basis. What is true of our personal lives also proves true in the lives of our corporations, which remain nothing more than a microcosm of society.

Corporations experience a daily state of flux and even the best run organizations suffer from entropy―a natural state of decay―or as others describe it, a “drift into failure.” Organizations, such as Operational Excellence, promote continuous improvement programs to help corporate leaders cope with the challenges presented by this increasingly complex global system, but these programs merely reflect the true challenge of our time―that we must constantly evolve in our thoughts and actions in order to survive and we need to do so in real time!

What do we mean by “complexity?” The Oxford Dictionary defines “complexity” using terms such as convolution, intricacy, involvement, but a simpler way of looking at complexity involves examination of an open-system, our inter-relationships, of the woven pattern to our lives that illustrates a myriad of interdependencies. We live in an interconnected world, more so since the advent of the internet, and one in which knowledge becomes a commodity. Today, if you have a question about almost anything, the typical response or helpful advice proffered says, “Google it!” The Knowledge-based system in which we operate today has changed the way we operate, sometimes for the better, but not always. A company failing to keep up with the modern world simply falls further behind, experiencing a more rapid “drift into failure,” and fail it must.

There can be no doubt that the corporate mindset must change in order to survive. This responsibility falls directly to the corporate leadership.

  • Complexity increases uncertainty and resistance to change, but also creates opportunities. Leadership must “get comfortable being uncomfortable!”
  • Leadership must challenge their thinking, inject innovative ideas, methods, products or services to improve performance, grow their businesses, and reverse entropy.
  • Leadership must understand and convey to all managers and employees that there are no shortcuts to success―that everyone’s actions and decisions effects their shared future.
  • Time is not your friend, instead, it remains a “wasting resource” that requires effective decision-making in “real time.”
  • Leadership must remain aware of external opportunities and be prepared to act decisively to take advantage of those opportunities as they unfold.

Manufacturing Practices, Inc., a veteran owned and veteran staffed company, has the expertise, experience, and knowledge to assist company leadership teams in developing these capabilities by exploiting the internal advantages afforded them through the optimization of their business management systems. Our consultants are APICS certified, an important distinction, in that ERP systems use the APICS Body of Knowledge (BOK) as the basis for the internal system logic. ERP systems provide the “real-time” information the leadership team requires to make effective decisions and we know ERP systems.

Who is Leroy Smith

Michael Roman - Wednesday, April 08, 2015

People have various success drivers. Money, fame, being the best, and wanting to make a difference are a few examples. On a ride to a recent civic function, the Manufacturing Practices’ team had chitchats about several topics. Sports became a topic. That discussion morphed into several questions about different sports personalities. Jerry Tiarsmith, the 1099 VP of Operations, with his keen understanding of such topics, gave answers to all our questions and gave some additional information, as he usually does, he being the didactic team member of the company.

During one of the discussions, I asked what drove him toward success and Jerry said “I just want to do my job, to the best of my ability” one thing that all our team members share.

At that point, Jerry launched into a discussion of Michael Jordan and asked us, if we knew who Leroy Smith was. Joe LaMere, our 1099 VP of Sales, answered quickly, “Mrs. Smith’s son” - you know how down-to-earth sales people are.

At that, Jerry explained that Leroy Smith was the reason that Michael Jordan got into the Basketball Hall of Fame. Leroy was the last man to make the High School varsity team that cut Michael. Jerry said that Michael stated in the speech for his induction to the Hall of Fame, he wanted to let “Leroy and the varsity coach know that they made a mistake by choosing Leroy and cutting me.” Being cut from a varsity position became the driving force that made Michael Jordan the Hall of Famer he now is. He made a decision to sharpen his skills in college and in the basketball profession. That discussion led to another discussion and the reason for this blog.

Motivation to succeed is a necessary characteristic of all successful people, including, those who sit in the C-Suite at manufacturing companies. However, it is not sufficient to possess just that characteristic. A deep and fundamental understanding of people, of systems, of policies, and ‘motivation’ usually completes the circle that leads to success.

At Manufacturing Practices, we know, we understand, and we are the conduit that connects that motivation and a company’s policies to the toolsets of systems and processes. Our consultants have been doing it for more than 30 years!

What distinguishes us from a majority of consulting firms is our depth of understanding of Enterprise Resource Planning (ERP). ERP’s body-of-knowledge (BOK) comes directly from the APICS BOK. Our consultants are required to have APICS Certification and keep that certification current. As the leader of the firm, I have maintained APICS involvement for more than 30 years. Manufacturing Practices continues to serve APICS and this year marks our ninth year as a member of the team that writes certification exams. Few firms in our space can claim that involvement with the APICS BOK.

Our ability to focus People, Processes, and Policies to increase the company’s competitive advantages is unique in the industry. Many successful companies have hired us to assist them realize their visions for success.

If you are interesting in hearing questions for your answers, or for the free MPI Gemba walk, contact us at 770-380-1033 or completing a form to send to our “Ask the Expert.”

I Think I Can

Michael Roman - Wednesday, February 18, 2015

Blog by Jerry Tiarsmith, VP Operations, Manufacturing Practices, Inc.

The old maxim, “Whether you think you can, or you think you can’t, you will be proven right,” reflects the importance of one’s mindset to future outcomes, good or bad.  The children’s story of The Little Train That Could taught us that perseverance and determination contribute to success.  Athletic team coaches know the value of a “warrior mindset;” the difference between winning and losing more often reflects the mental preparedness of the players rather than the relative physicality and athleticism of the opposing teams. Military combat leaders know that victory (and failure) begins in the mind!

Manufacturers must possess a positive mindset toward successful outcomes. Clearly, the stakes are high; people’s livelihoods are at risk and we are not here to discuss children’s stories or motivational platitudes. Whenever businesses fail, reputations as well as many individuals, families, and communities suffer great consequences. “Failure is not an option!” Yes, the company organization, at all levels, must exhibit perseverance and develop a fierce determination to succeed in the arena of competition, but that may not be enough. Sometimes, companies require outside expertise, particularly when they lack the internal experience and resources required to initiate major change.

That fact proves especially true for many manufacturers in relation to the selection and implementation of the company’s Enterprise Resource Planning (ERP) system.  Improper ERP implementations result in cost overruns, take too long, and prove too disruptive, even if considered “successful.” Companies that lack the necessary internal experience to manage the selection and implementation processes experience significant problems. Executives may strive to develop a thorough plan in anticipation, but their project management and process objectives fail to align adequately with reality. Poorly defined processes or an insufficient understanding of needed resources required for a timely and cost-efficient implementation may be the culprits, but many companies simply do not know what questions to ask of the vendor/sales rep or how to interpret the (often obfuscated and sometimes inadequate) answers they receive from the vendor’s implementation team. Poor ERP deployment results from the following: insufficient system pilot testing, the failure to input needed or correct data, the inadequate knowledge transfer from vendor to company employees, and yields sunk costs in a system that never sees full implementation.

The consultants at Manufacturing Practices, Inc. possess the requisite experience, knowledge, and resource capabilities to help guide your next ERP system selection and implementation processes. Our consultants successfully implemented over 70 ERP systems in companies much like yours. We require our consultants to receive training and earn professional certifications in the APICS body of knowledge; the very same body of knowledge most often used in the architectural design of ERP systems. We are proud members of APICS; the most widely recognized professional association for supply chain and operations management in the world. Our firm abides by the code of professional ethics established by the Institution of Management Consultants. Manufacturing Practices, Inc. is a veteran-owned and veteran-staffed company that offers scalable, flexible, and cost-effective solutions to meet client needs.  

COMPLACENCY KILLS

Michael Roman - Tuesday, January 27, 2015

COMPLACENCY KILLS  by Jerry Tiarsmith, VP Operations, Manufacturing Practices, Inc.

Complacency kills; a simple but true statement. One writer described complacency as “the enemy of intelligence.” The typical definition of complacency (a noun) often includes words such as a feeling of satisfaction or security, unaware of some potential danger, defect, or the like. My guess is that most manufacturing executives would not describe their business using the word complacency or complacent (an adjective). They are, after all, hardworking, caring, and concerned individuals trying to do right by their employees and families. We get it, we really do!

Are some company management teams complacent? Yes! Do they recognize the fact? Not some we see. So how do companies exhibit complacent tendencies? One of the best indicators is when a CEO acknowledges the company’s process problems and then dismisses any concerns with the statement, “But, we are making a profit!” On consulting engagements, we often hear CEOs and senior managers using the term, “tribal knowledge,” and doing so proudly. That makes us cringe. “Tribal knowledge” highlights a process, or design flaw, and maybe both! It indicates a probable out of control process. The resulting variations create an inability to calculate accurate product costs. At the very least, a reliance on “tribal knowledge” exposes a company to unnecessary risk and creates a competitive advantage for “the other guy.” By allowing front-line “tribal knowledge” to persist, a CEO (and his management team) remains complacent regarding the bottom line – just because they are “still making money.”

Another form of complacency involves companies that become reliant upon the use of technology in lieu of standard Operations and Supply Chain Management training & education. Creating additional work for employees, without enriching the work (i.e., gaining user buy-in), creates a complacent and demoralized workforce. Far from empowering employees, wrongly depending upon technology helps create or reinforces the impression of distrust. If employees are smart enough to figure out how to work around incomplete or ineffective processes and design flaws, they are smart enough to train to do the job you ask of them and to do it well. Good pay and benefits are a poor substitute for increased responsibility and participatory decision-making. Those ought to exist as employee satisfaction and engagement processes.

Manufacturing Practices, Inc. consultants assist small- to mid-sized manufacturing and distribution companies to unlock unrealized value in their businesses through the effective use of their Enterprise Resource Planning (ERP) system. We also see how complacency negatively affects ERP systems. Much like any business management system, garbage in, means garbage out, and ERP systems prove no different. As an example, failure to input an accurate Bill of Materials (BOM) to the ERP system results in a system that can do little to produce meaningful reports to help management make effective procurement and production decisions. The mere installation of an ERP system does not guarantee an improved decision-making process. It takes time and commitment throughout the organization to enter complete and correct data and transaction information. Technology does not replace the human factor, judgment, nor common sense. An ERP system is not an autopilot, a plug and play app, or a default management decision-making system. It is a management decision-making support system, a very capable tool when combined with proper understanding and deployment. Successful Management Teams create it upon the groundwork of Operations and Supply Chain education and procedure based ERP training. Such a deployment almost guarantees its proper use.

Complacency kills! Root it out of your business to improve your competitiveness and bottom line. Manufacturing Practices, Inc. can show you the way!