September 1, 2003
We have been involved with operations during the 1970's, 80's, 90's, and now 00's. Countless industries, applications, and customers. We have studied operations history that goes back hundreds and thousands of years.
Funny how someone comes up with a "new idea" about every five to ten years. If you have experience, you'll see there is nothing new about the concepts. You can also tell the people that aren't experienced -- because they think that it is some great new idea.
We have friends that are high-paid consultants. We were talking with one and asked how the process reengineering business was going. He said "oh that was five years ago and now that all processes have been reengineered we are doing ERP and Six Sigma".
What? Excuse us? All the processes in the world have been optimized? Let us translate what he was really saying.
No one will still pay for reengineering so they had to start calling their work other buzzwords that customers don't have -- so customers will think this new buzzword is some great new invention that they have to buy. Along came this great buzzword "reengineering", all operations managers were expected to do it, all operations managers did it (or said they did it) so that their bosses and investors would get off their back. Then no one would have to do it anymore!
There are other "experts" that are doing the same thing with "lean manufacturing", "collaborative manufacturing", CRM, "supply chain management" and other buzz words.
Two questions:
1. When did the old good ideas (JIT, quality circles, cellular manufacturing, SPC, time studies, continuous improvement, reengineering) become bad ideas?
2. When were these new ideas -- not good ideas?
Notice that the home page of our website states that our mission is to "Improve our customer's operations by making them faster, better, and cheaper." We could come up with a dozen sexy sounding buzzwords, have twelve websites (one optimized for each sexy buzz word), and charge a whole lot more. But we are simple, to the point, kind of people.
If we charge $75 to $125 per hour to simply "improve our customer's operations" we could charge double that if we simply called it "ERP", "Six Sigma", "CRM", "SCM", or "lean manufacturing".
When customers ask us our rates we tell them $75 to $125 per hour with an additional $50 per hour to wear a tie and an additional $75 dollars an hour to wear a coat and tie. Perhaps we should add another $50 per hour to change our "faster, better, and cheaper" to something more sexy like "vertical enterprise integration of lean collaborative customer focused real-time quality".
Wow! Talk about something that every customer needs!
We can hear you now. "This is all great and interesting -- but what does it have to do with churn & burn"? Give us a minute -- we'll eventually get there ...
Creating buzz words is just "churn & burn" taken to the next higher level. A consulting group has burned all the customers and can't get work. So they repackage old ideas as some great new idea, create a new buzz word, and "BAM" -- now they've got something that every customer needs! Then they go back to all the old burned clients, hyping this great "new idea", burn them again, and then start on the next "great idea".
We can hear their sales pitch now. "Yeah, ERP never did give customers the expected returns it was suppose to. But we were never into that. (they were hyping just like everyone else) And that other contractor you used was a crook for quoting you that low price, locking you into a contract, and then charging you double. (as if they aren't about to do the exact same thing) But 'vertical enterprise integration of lean collaborative customer focused real-time quality' is nothing like that and will give you a 25% ROI the first year, eliminate all your problems, and jump you ahead of your competitors -- all for the low price of 5 million dollars" (knowing that it will cost $10 million and take ten years to pay for itself).
It's just not sexy enough for operations managers to just want "faster, better, and cheaper". Who wants to work on that? Well, besides us?
Don't get us wrong. None of these buzzwords (ERP, Six Sigma, reengineering lean manufacturing, etc) are bad ideas. Our point is -- when were they not good ideas? Why do we need to create new buzzwords for the same old thing? These are all ideas that have been around for hundreds and thousands of years. The only thing new are the technological innovations that make them faster, better, and cheaper.
People often credit Henry Ford with specialized labor in the 1920s and credit Just-In-Time with the Japanese after WWII. Does anyone believe that when the Egyptians built the great pyramids thousands of years ago that tens of thousands of people all went out to cut all the stone first, then they all worked on transporting all the stones to the site second, and then they all worked on stacking all the stones? Hell no. They had specialized labor (some cut, some transported, while others stacked) that delivered the stones Just-In-Time as they stacked them. Or the supervisors were fed to the lions (just kidding -- I hope).
Prosperous medieval towns were those where people started to provide specialized labor.
There are books on England's quality control problems and their ways to measure and control quality back in the 1700s when America was trying to export timber, masts, rosin, turpentine, and other abundant resources. England wanted to buy from America but America had many quality and "supply chain" problems that they had to overcome before England and other countries would buy their products.
There are books for hundreds of years on the exact same problems that companies have today.
I wonder how many "reengineering", "ERP", "CRM", "collaborative", "Six Sigma" experts have read even one of these books?
After all, customers are buying buzzwords. For example, many times customers will not consider us for a project because we didn't toss the correct buzzwords around. I think what we need to do is develop a buzzword generator. That will not only double our sales but double our prices as well.
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