Deming’s long forgotten chain reaction

September 26, 2010

In today’s world, many organizations are too focus on cost saving and productivity.

But if you focus on those two measurements,  it is more likely you will get them for the SHORT RUN only. In the LONG RUN you might end up with closing business or selling out your company.

Why?

Because, the objective for productivity or cost saving are (generally) to achieve this month or this quarter’s number, so the analysts at the stock market won’t yell at you (which could herd the market to depreciate your company’s stock price) or just simply somebody high above at the very top management told you so. Period.

Too much focus on cost saving will alienate your customers and make your employees unmotivated. This is why, companies which too much rely on cost saving will fall into the “doom loop”. FAMILIAR?

So what we have to focus on?

For the answer, I will refer to the great W. Edwards Deming.  My recommendation for anybody who’s thinking for future growth and keep competitiveness in the market should focus on the first item on this Deming’s chain reaction: improve QUALITY.

He wrote in his book Out of the Crisis  (in early 80s) that “This chain reaction was on the blackboard of every meeting with top management in Japan from July 1950 onward”

But please be warned! It ain’t a short term game, it takes patience and persistence and faith.

Remember,Japan in 1950 was known to produce craps (hence the term “Japs craps” at that time). Japan in the 50s was barely wake up from the defeat from World War II. Their faith in Deming’s (and Juran’s and Sewhart principles) lead them to what Japan today is. But it takes almost 30 years (!) to transform majority of the organizations in Japan. And I still believe, they need another revolution today. The same thing will come to Chinese goods and services. Ten years ago, they were just another cheap craps. Today and especially in the future, China will become the biggest economy of they keep improving their goods and services.

In the nutshell, you have to focus in improving your quality of products, services, continuously.  With better quality you will have better productivity, better profitability, and you will have the likelihood to stay in the business and finally provide jobs.

As businessmen, obviously we have to keep our company profitable but also we have the responsibility to provide jobs. Not just thinking for short term profitability and all we do is cutting cost.

As simple as that.


if you haven’t got the answer, you might have not asked the right question

September 5, 2010

for jakarta dwellers, traffic jam is the most important issue.

people thinks it is very crucial for the government to solve the issue, but this issue has been around for more than 15 years 🙂

the government, experts, legislators and ordinary people majority of them think the solution is mass rapid transportation (MRT), the most awaited thing to come in jakarta (more than iPad, obviously).

for me, while the MRT existance is one big part of the solution, I am more interested with the problem.

First of all, the growth of roads in the Greater Jakarta is less than 0.01% per year. The growth of vehicle is 8%.  It does not need a professor in transportation to see the obvious problem.

But this is the same society who likes to show the economics growth with the “positive growth” of car/motors business. We celebrate the annual Jakarta International Motor Show with high anticipation, many visitors and of course the traffic jam in the convention center, and all media will cite the success of the exhibition by quoting the number of  sales and orders. This is the same society who relate success with the ownership of car or motorbike.

To make thing more complex, our economy depends highly on the vehicle industries. Many business, money, and employment are created by the high growth of car/motor industries.

Secondly, is it really only the government’s responsibility?

Let me tell you my observation as a frequent commuter. I have seen bus/truck on the fast lane, not on slow lane. I have seen small car run very slowly on the fast lane, without feeling something’s wrong. So many crazy drivers run their cars zig-zag in the middle of heavy traffic. Motorcycle riders (aka “bikers”) have their own rules. They use the ramps, trotoars, every space they can run through. Most of them don’t stop at the traffic light, get angry when THEY hit other cars.

And the police? They should have enforced the law. Many traffic jams are because of lack of law enforcement. Buses use intersection as temporary terminals. Pedestrians cross the road anywhere they wants. And there is this rule “3-in-1” which I think the biggest joke of the century. Everybody knows that is not effective, does not help the traffic and only creates another problem.

In my opinion, the MRT is a great thing to build. But before that we need to set the basic’s right. As drivers/bikers, we must follow the rules. Policemen must enforce the law. With these two, I think we can reduce the traffic jam a lil bit in the short term, AND especially in the future.

Without getting the basic right and the discipline, the MRT could only create another problem. Just like the busway project.

Sometimes what we need is not a better solution, but just a better way to look at the problem.