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Beat the clock ... to win the race.

A recent study by the Office of Technology Assessment reports that "U.S. manufacturing is falling behind (and) the standard of comparison is Japan." A large metropolitan newspaper observed that countries around the world are following Japan-like strategies and that all these countries have comprehensive government strategies to encourage technological advances. The newspaper reported that the study said "If there are no major changes in government policies...we expect U.S. manufacturing competitiveness to continue to sink compared with Japan."

I don't believe we can rely on government intervention or assistance. This is not the cure-all. It seems that a day doesn't go by that we don't read about our global competitors producing higher quality products or gaining market share in markets once dominated by U.S. companies. The solution is not simply fixing our technological competitiveness. U.S. industry must go through a transformation to become a world class competitor.

To be a world class competitor, American industry must understand how work gets done, what the customers' quality expectations are and have a vision of the most effective way of doing things. Our leaders must set core quality objectives, establish measurements and concentrate on continuously improving processes rather than fixing short-term events.

World class athletes do what American companies must do. World class sprinter Carl Lewis has one goal in mind: to be first to the finish line. As the starter raises his gun, Lewis anticipates every step he will take to get to the finish line before his competitors.

To win a world class race - Lewis focuses on beating the clock. He starts by benchmarking his world class competition. He wants to know what their times are and how fast they are running. He wants to know what they have been doing that enables them to perform at world class levels. He then establishes performance measures which he uses to continually improve his race times so that he will be the winner.

In other words, Lewis does a lot of homework before the race is run, applies it during the race and evaluates his performance afterward.

I can't resist another sports analogy to illustrate this point. I think it was Vince Lombardi, coach of the champion Green Bay Packers, who said winning is 90% mental and 10% physical. He believed that, if we know our objective and are committed to it, and we study and rehearse, we've done most of the work.

I take this to mean that a winner must have a well-thought out game plan, must study the opponent and must raise his performance to a level above that of his competitors. This is done by benchmarking and measuring.

To be a world class winner

World class business competition is no different. To be a winner in today's fiercely competitive global markets, American industry must adopt the dedication and discipline of world class atheletes such as Carl Lewis and Lombardi's Green Bay Packers. American companies must heed Lombardi's advice. They must have a game plan that is based on benchmarks and measurement.

American industry is in its most important competition. To be in the game in global markets, winning organizations must have a game plan that connects strategies and actions. The binding element in linking quality strategies and actions is measurement that supports and enhances continual performance improvement.

Doing this means we need not benchmark and measure everything. My experience as a Baldrige examiner tells me that many American companies may be going overboard in benchmarking and measuring. The successful companies that I observe are very focused strategically. They center their benchmarking and measuring on metrics related to accomplishing a simple vision. It doesn't mean they abandon everything else, but they do focus in on a core goal.

With a simple, clear core goal established, then benchmarking can be used to remove disbelief. Traditional companies will measure themselves based on their historical performance. For example, after determining that their inventory levels have been running 120 days the conventional company sets a target of 90 days and then works diligently to put programs in place that will achieve this measurement.

If they really want to be world class, they would find a company with an inventory of 10 days. For example, L.L. Bean, a leading mail-order apparel firm with recognized superiority in warehousing and materials handling. By studying how this world class company manages to perform so exceptionally, the conventional company becomes a believer. By benchmarking, people see that it can be done. Knowing that it can be done encourages people to set measurable objectives which guide continual improvement.

World class athletes constantly compare themselves to their competitors. Since Lewis observes how fast his competitors are running, he knows that faster times are possible. He then constantly measures his performance which allows him to make adjustments that will improve his times.

Lewis narrows his focus - his stretch objective - to time. This is the measurement that guides his continual improvement. He knows that if he improves his performance by using time as the common denominator, he will win most of his races.

World class companies must also set stretch objectives based on benchmarks and measurements. For example, Xerox benchmarked its performance measuring research and development against AT&T, billing processes against American Express, and employee suggestion systems against Milliken & Co.

For Xerox, the benchmarking and measurements led to changes in employee and corporate behavior which resulted in: three-month inventories being reduced to nearly 20 days; manufacturing costs dropping 20%; product-development time decreasing by 60%; and overall product quality improving 93%.

The use of time, in my opinion, is the measurement for the 90s. I believe the global competitive battleground will be in responsiveness. I think the successful companies in the future will be those who do things the fastest. Time reduction will be the ultimate test with the winners being those companies that get to the finish line the quickest.

What's good about time as a measurement is that it can be applied to any function, organization or process. If individual employees and teams begin to measure and reduce the length of time involved in a work process, many improvement areas will emerge. Especially, if the benchmark measurement is compared to world class performance.

However, it's not just doing things faster. It's doing things more efficiently so that the process requires less time. It's reducing the total cycle time - or lapsed time - of a process. To fully understand a process cycle time, it must be broken down to the smallest parts and then rebuilt to the most efficient total cycle time.

The dissecting of cycle time can be done in various ways. Some companies that are reducing cycle time are flow-charting or mission mapping processes. They form cross-functional teams to ask questions. How does the process start? What are the steps that the work goes through? Before cycle time can be reduced, the process needs to be understood. That is very important.

Reducing cycle time by doing something faster doesn't mean quality will suffer. In fact, quality should get better if process changes are made only after a process is thoroughly understood. Only then is it possible to remove any step that doesn't add value to the process, yields will improve, wastes will be reduced and costs will decrease.

It is important to emphasize that the ultimate goal of time reduction is to be more responsive to customer needs and that customers will have their own expectations.

According to Stephen W. Hawking, noted physicist and author of "A Brief History of Time," there is no such thing as absolute time. He theorizes that time is in fact relative to the observer's point of view. The passing of time relative to an event will depend on where an observer is in space. I take this to mean that our customers will have their own determination of the significance of time. This then suggests that before we go messing around with making things happen faster, we better have a good understanding of what the customer expects.

As a quality dimension, we must determine which cycle time reductions - be it processing orders quicker, expediting technical solutions to customer problems, delivering materials sooner - will satisfy our customers. In today's world class competition, customers are standing at the finish line waiting for the swiftest of foot. For American industry to be among the winners, our leaders will need to become better coaches with well thought out game plans that focus on beating the clock to customer satisfaction.

I believe being more responsive to customer expectations will be the "competitive edge" of the nineties.
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Title Annotation:industrial competitiveness
Author:Addison, Thomas E.
Publication:Rubber World
Article Type:Column
Date:Jun 1, 1992
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