"LET'S kill all the lawyers" is a famous line from English playwright William Shakespeare's (1564-1616) Henry VI. It is often wrongly interpreted to mean that the best way to improve the country and cure all societal problems is to kill lawyers who are notorious for perverting the law.
The same can be said of organizations suffering from overpopulation caused by problem managers who don't know how to improve productivity. When it becomes unprofitable for the organization, they reduce the headcount and force the survivors to perform all tasks without raising their pay.
At times, management does it with a semblance of order by reducing headcount under the principle of "last in, first out." Sometimes, benevolent organizations ask for volunteers and offer them handsome early retirement packages. The trouble is that these are the exception, not the rule.
Meanwhile, if business is doing good and yet management wants to further improve the bottom line, they think of pain-free interventions to avoid labor issues. So, how do they do it? A case in point is the following true story, which happened in a Laguna factory:
Worker A's job was to put raw material into a processing machine. After a few seconds, the machine would spit out a finished product into the palm of Worker B, who puts it on a 5-meter conveyor belt where at the end Worker C picked the product up and put it into a packaging machine. At the end of the production line was Worker D, who would place all products into a 1-meter by 1-meter container for shipping. In all, four workers, a conveyor belt and two machines were involved.
The factory CEO (chief executive officer) was not happy with the set-up and vowed to improve productivity. He tasked the factory manager, the shop floor team leaders and their workers to do something. After two months of trial-and-error experiments, they failed to come out with a practical solution.
Under the kaizen mindset, "a practical solution" means coming up with an inexpensive, common sense solution to any problem. Creativity before capital. The trouble is that the factory manager doesn't know how to do it.
The frustrated CEO then hired a kaizen consultant who recommended that the two machines be reconfigured so that they sat close to one another. This also resulted in the elimination of the conveyor belt. The result was convincing, with total eliminated waste of $1,800 or $21,600 per year.
The new layout also required only one worker to do the process. It saved 5 square meters of space and reduced the lighting requirement in the area. The new layout, however, meant there was an excess of three workers. The CEO was happy but was concerned with the job security of the three.
"What are we going to do with the excess three workers?" he asked the consultant. The reply was quick: "Regardless of their employment status, dismissing the workers should be the last resort. The first option is to transfer them to other units or sections of the factory."
"But what if there are no other job vacanc[ies] for all three workers?," the CEO then asked. The consultant wasn't moved: "Any worker, even if they're holding a regular or temporary status should not be a victim of any kaizen improvement. Otherwise, other employees will not participate in a similar endeavor in the future."
Let's complete the story. Among other home appliances, the factory produced 100 electric fans a day using 10 workers. The CEO required the team to improve productivity by 20 percent starting October 1 in preparation for the Christmas season. The factory manager suggested making it easy and simple by doing the popular western approach, which meant the termination of two workers.
The CEO rejected the idea. "We're preparing for the Christmas season. That means we should increase our production. Do the Japanese approach," he said, adding: "I would like you to increase the daily quota to 120 units using the same ten workers. That's also a 20-percent improvement, right?"
The manager went back to work scratching his head, having made three fatal mistakes overall. First, he missed being proactive in improving labor productivity. It took the CEO to call his attention to it. Second, the CEO rejected his idea of firing two workers to achieve the 20-percent productivity gain. Lastly, it took an outside kaizen consultant to solve the problem.
If you want managers and their workers to do their homework in good and bad times, challenge them to exceed top management expectations by achieving a clear business target that should come from them. It's not rocket science. All ideas can be learned without the help of external management consultants. That is, however, if managers know they're part of the problem.
Rey Elbo is a business consultant on human resources and total quality management. Chat with him on Facebook, LinkedIn or Twitter or email your feedback to [email protected] or via https://reyelbo.com.