Our team went against
the company culture when we decided to use Throughput Accounting, but believe
me it worked. And because of the
simplicity of the definitions for each, we were able to teach our workforce how
to use them as well. Before you ask,
yes, we had to continue using Cost Accounting to satisfy GAAP reporting
requirements, but for daily decision-making, we found Throughput Accounting to
be vastly superior to Cost Accounting. Let’s
continue the saga of our plant in Kentucky and as I said earlier, some of our
experiences were positive and some were very negative. We celebrated our positives and learned from
our negatives.
One of the pleasures
of being a part of a turn-around is seeing the transformation of the systems,
people, product and customer. On this
last point, the customer, I want to relate an event that took place about five
months after we began our transformation.
This event was a visit we had from one of the purchasing executives from
BMW in Germany. Since we had improved so
rapidly, he decided to pay us a visit to see first-hand just what we had done
to improve our quality and delivery.
I mentioned earlier in
the explanation of our problems with our fiberglass hardtops that there were 48
measurement points to determine how well the hard top mounted to the
vehicle. We greeted the executive team
that had accompanied the purchasing executive, exchanging pleasantries and
getting to know each other until he announced that he was going to our
manufacturing area and that he would randomly select a completed hard top and
have it mounted on their Z3. He further
stated that his quality manager would inspect all 48 control points for
conformance to specs. The quality
manager took his time, inspected each point and concluded that all points met
BMW’s specs. The purchasing executive’s
eyebrows rose in disbelief and with a very heavy German accent said, “Mr.
Sproull, the measurements are only part of what we expect.” He then said, “Mr. Sproull, you will drive me
on the Interstate at a high rate of speed and I will listen for air entering
into the vehicle.”
He and I drove to the
Interstate and he instructed me to accelerate until he told me to stop, which I
did. His ear was pressed close to the
hardtop mounting area as he listened for the slightest sound of air passing
under the hardtop. At 65 mph there was
no sound, so he instructed me to accelerate again up to 75mph, but still no air
entering the vehicle. He had a very
disappointed look on his face so, on my own, I continued to accelerate to 90
mph, then 100 mph and finally to 105 mph.
He looked at me with a fearful look on his face and instructed me to
return to our facility. We had passed
his functionality test with flying colors!!
When we returned, he
explained that he wanted to mount a black hardtop on his vehicle so that he
could compare our paint job to his.
Painting at our facility was something we now took pride in, but not so
in the beginning. When I had arrived at
the Kentucky plant I saw first-hand just how bad our paint jobs were. We had a very old paint booth which was apparently
full of dust particles that ended up on the surface of our vehicles. I put together a team of maintenance
mechanics and explained that we needed to figure out a way to keep our paint
booth free of particles and that I needed some good ideas. I also explained that we couldn’t go out and
purchase a new paint booth. To make a
long story short, one of the maintenance mechanics had a side business for lawn
sprinklers. He had this bright idea that
if we mounted such a system in the paint booth, we could actually clean the air
between paintings by emitting a fine mist of water. We tried it and it worked like a champ!
Back to our
story. The purchasing executive randomly
selected a completed black top and we mounted it on his vehicle. We parked it in a highly lighted area and he
scrutinized it for a good 30 minutes.
When he was finished, he summoned me to the vehicle, looked me in the
eye and said, “Mr. Sproull, we have a serious problem!” I asked him what the problem was and he told
me that our paint job did not match the paint job on his vehicle. I was shocked because I knew our painting was
the best in the industry. When I asked
him, what was wrong with our hardtop’s paint job, he sneered at me and said
absolutely nothing! The problem was with
his own vehicle. There was an enormous
amount of orange peel on his vehicle’s surface.
My response to him was, “Would you like us to add orange peel to our
hardtop’s surface?” He looked at me and
simply said, “I don’t find any humor in that remark!”
Yes, this day was one of our great days for our plant. All of the hard work and dedication of our employees had paid off as the purchasing executive from Germany told us that he wished all of his suppliers were as good as we were. I asked him to speak to my employees and let them know his feelings which he did. That day was clearly a turning point for our plant both in our reputation and the morale of our workforce. They had pride for the first time in years and I’ve always believed that “people who feel good about themselves….produce great results.”
TO BE CONTINUED
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