sDBR episode 03
Ever seen a building without a solid framework?
If you did, it was probably flat on the ground. Lifeless. The same goes for businesses and doubly so for startups.
[may I assume you have read the previous episodes?]
“Success is 94% the result of the system.”
—W. Edwards Deming
The United States Marine Corps
For me, school was not a system. It was a baby sitter with more rules than Carter had pills as the expression goes. Perhaps it was the week’s suspension from high school around Thanksgiving that planted the seed: What was I going to do with my life?
I enlisted at age 17 in January of my senior year on the delayed entry program and headed off to boot camp in July. If you don’t know, I have always been better than average at playing the odds. Although I only signed up for two years [an option right after the Vietnam War], I refused to sign unless they promised me Boot Camp in San Diego, California. Rarely leaving Ohio growing up, it seemed at 17 I might not ever see the west coast unless Uncle Sam paid for it!
Sure enough, after a few days waiting around a barracks in the sun, “pick up day” came and my platoon was formed. It was the worst day of my life. Each demand to “get into formation” was shared with all the screaming and yelling you see in the movies. From several Drill Instructors. About an inch from your face. Which included following directions to hold your duffle bag over your head the whole time. Or in most cases, attempting to hold it above one’s head. Nothing really prepared me for what happened that first week. I would come to understand that it is part of a system. A framework. What is often called a well-oiled machine. The Big Green Machine. The Marine Corps.
Frameworks
Over the course of ninety (90) days, wet-nosed kids from all walks of life are transformed into lean, mean, killing machines. You see, the Marine Corps has a framework for success. If you don’t know, enlisted personnel all go through the same 90 Days of Basic to become Riflemen aka Grunts. Then you go to school to learn a “trade” or a special set of skills.
After two years of active duty, I was ready to put this amazing experience in my rearview mirror. Back then, we had a six-year military obligation, so my Honorable Discharge was 3-½ years later [because of the six months on delayed enty]. Some of the highlights: I was trained on the FADAC Computer for Artillery, but got bored and worked on and received a secondary MOS (military occupational specialty) as a Correspondence Clerk. Qualified as a Rifle Expert. Plus, I received a Letter of Commendation for process improvements I recommended for a number of Policies.
I went to college with the G.I. Bill at Kent State University and, among other things, learned that many organizations including world leaders like Intel used a 90 Day Project framework to implement change and introduce innovation.
TOC Framework
Within the Theory of Constraints, there are a number of frameworks that have evolved since the 1980s. This first one was covered in the book, The Goal and I used it at Red Horse Motorworks.
- What to change
- What to change to
- How to cause the change
My contract with Red Horse was 90 days in length and was broken down into three months of effort. The first, determine what was broken and how that affected operations throughout the company. There was a briefing at the end of the first month where I presented a report on all the nuances to the owner.
The Weakest Link aka What to Change
The fact there was a problem was no mystery, but the owner had “explained it away” having tried traditional approaches to fix production. The symptom was they had sold more motorcycles than they could produce in a timely manner and after six months of waiting, customers would cancel their dreams of owning a custom American Chopper [MSRP ~$30,000.00USD] and demand their deposit be refunded. Not good.
The problem was the failure to have enough of the right parts on hand when it came time to build the custom order. Typically it took four or five days for one builder to complete a bike, depending on the style and options.
The traditional approach to solve the challenge was for a builder to start working on a second motorcycle. Do I need to say how much extra money was tied up in raw materials and work-in-process with this approach? I didn’t think so. Before I presented my findings, I asked how they would have proceeded if I hadn’t appeared on the scene.
“I guess we would have the builders start on a third bike while awaiting the final parts for the first two motorcycles.”
—The Owner
Honest. He said those words. What did the tools known as The Logical Thinking Process (TLTP) tell me was needed? Build only one bike at a time!
What to Change to?
Easier said than done, right? Not really. I implemented a new policy to ensure success. I had the Parts/Warehouse Manager pull all the parts for the next bike to be built, two days before the builders “first” bike was completed. Yep. But how would that work, given the “shortage” of parts.
That is a great question! The perfect question in fact. This is where you learn if your system of processes is up to the challenge. And, if they are not, how do you make the proper adjustments? The framework must have the ability to direct you to the best answers and TOC’s Drum-Buffer-Rope does in fact have the tools necessary. But rather than use traditional DBR, and spend time on tests to determine the best Drum and adequate Buffer sizes and a suitable Rope, I elected to use sDBR. (aka Simplified Drum-Buffer-Rope)
Made to Order
When you are selling custom motorcycles off the internet and out of monthly specialty magazines with national distribution, MTO makes perfect sense. The problem is the number of configurations possible. Just ask any OEM like Harley-Davidson or Honda. Although consumers might think the more the better, your Supply Chain can quickly become a very tight chain around your throughput and therefore, your cashflow! Ouch.
Why did I select sDBR for this operation besides the MTO factor? Every production decision should be driven off the initial deposit the customer makes to begin the process. At the time an order is placed we know what model and options are required. We know every part required, all paint requirements, assembly steps and any unique requirements as well. Not to mention the destination and of course the origin aka point of manufacture. We also know the average lead times on all parts and subassemblies. We know our stock levels on standard items like frames, gas tanks, and the buyers’ motor of choice. Finally, we know the workload of each builder and when the next window will open to build the next bike, and we know whether this model requires four or five days to build and test.
How to Cause the Change
We simply did the math to determine when a particular truly original custom American Red Horse motorcycle would ship.
Okay, there is often resistance to change, right? How did we deal with that fact? Plus, what about people and skillsets? Did we lay anyone off?
Tune in next time: Doing the Math
#sDBR #ROI #TheoryOfConstraints #JeffSkiKinsey