A useful distinction, I discovered, was between efficiency and effectiveness: a more efficient process that worsens the customer experience is not the option to take. In the context of an innovative toy company with its own factories and a high turnover in its portfolio of products, dealing with fluctuating and seasonal demand, the matching of supply to demand requires constant discipline, anchored around the “vital few” data points and overseen by a multi-disciplinary team. The over-automation of the packing process could result in overly rigid processes in which we were packing the wrong things more quickly. Too much inventory is inefficient from a business point of view and has a negative environmental and brand impact. The efficiency of our molding processes, on the other hand, was continually enhanced through robotics.
There are essential disciplines to observe when weighing up where to deploy data and the latest technology. The central one is to maintain an overall understanding of the entire value chain of the whole business. This is allied to working back from the customer’s needs. A multi-disciplinary approach, in which all relevant divisions are represented, is essential. The decision on which parts of an operation to automate, and how, should be a joint managerial decision, not one that is left to technology gurus alone. Once this is decided, then the tech experts can oversee the implementation.
Visualize your operations as a team
An approach I introduced at LEGO – initially in our North American operations but eventually adopted globally – and used in other companies is that of the “visual factory”. This is anchored around a weekly operations briefing, which provides a concise yet full overview of the company’s operations, attended by all relevant personnel (and no one else!). The briefing starts on time, typically early morning, and only lasts for 30 minutes, or 40 minutes if there is a major issue to address.
The “vital few” points of data (and nothing else!) are written up on a whiteboard. They are coded green for “on course”, and red for “attention/action”. The kind of data used in this process may change over time – at LEGO, we would have a review every six months. Typically, data would cover areas such as customer service, complaints, progress against delivery, and business results as well as health and safety indicators.
The physical act of writing on the whiteboard serves to embed the importance of an action in the individual’s memory. It reinforces personal accountability too. The individual responsible for an action must report back to the group the following week.