Einstein And The First Law Of Business Strategy
Einstein defined insanity as doing the same thing over and over and expecting different results. Ex. Competitiveness for Canadian business.
Albert Einstein defined insanity as doing the same thing over and over and expecting different results. This rings true in the 21st century when articles in newspapers and interviews on TV expound about the lack of competitiveness in Canadian business compounded with a skyrocketing incidence of stress related afflictions. The focus on trying to remedy symptoms rather than taking the time to drill down to the root cause of the underlying problems is evidence of a shallow management approach.
All too often management reacts to competition by laying off personnel or outsourcing the function in a misguided drive for efficiency. This approach is exemplified by the original North American and European automakers with their outdated single vehicle assembly lines and long lead time to introduce new models. Contrast this with some of the off-shore competitors that through flexible lines in its North American plants produce up to five models in a mixed mode on a single line in response to customer demand.
In a similar fashion, insurance and banking management outsource the "back room" operations to low wage off shore locations. The same mind boggling multi-level bureaucratic process should be evaluated by using a tool, Enterprise Value Steam Mapping™ of the process, to eliminate waste and keep the function close to the customer.
Healthcare is also in many cases as myopic in its approach to service delivery to the customer (a.k.a. patient). Government cannot continue to throw billions of dollars at treating the symptom of long wait times without the hospitals delving into the root cause of the problem. There is the case, not in Canada, of a major not for profit hospital reducing MRI wait time to less than five days with a goal of getting it down to one day.
Is a rocket science strategy required to effect change? The answer is a resounding "no"! The strategy is to embrace Lean as the way of doing business. This is not the "flavour of the day" that the boss mandates after having attended a one day seminar. Rather it is a journey, that through changing the way manufacturing, services, and the associated functions are carried out, enables the enterprise to survive and grow. Today's Lean, which has morphed from the Toyota based Just In Time approach to manufacturing, is vastly different from the "lean and mean" slash and cut of the once favoured business process re-engineering. Lean is a simple strategy, that through involving employees at all levels, focuses on the customer and elimination of waste, variation, and imbalance in the system resulting in fast response to the customer, lower costs, better quality and improved bottom line - all this without adding people or purchasing high priced equipment or adding space.