I recently moved out of production, but before I left, the results within my unit were: cycle time reduction of ~85 /o. Operator headcount reductions of 35% through attrition; no layoffs were needed. Work in process and finished goods inventory down ~70%. On-time delivery went from ~50% to ~90% and the number of material handling steps were cut by over half. Our plant, and business unit have done very well too. And me, I received a promotion while in that position, and a compensa- tion award. Dow Corning, like many other corporations, has downsized multiple times in the past five years. During each one, our plant, and business unit were affected very little or completely passed over. I am convinced that if we hadn't read and followed the methods in "The Goal" and "It's Not Luck" the situation would be much different today. There is still much to do, as our business unit is the only one to really have embraced "The Goal." I am hoping in my new role in Six Sigma that I can further share your tools and methods.
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Thank you for signing the book Dr. Sirias has forwarded to you on my behalf. I am honored.
Sincerely,
Robert (Rob) Kain P.E.
Six Sigma Black Belt
Dow Corning Corporation
Life Sciences/Specialty Chemical Business
DW: Impressive, but why is only one business unit of Dow Corn- ing using TOC? What bothers me is that this person is talking about a span of over five years. If it worked so well, why didn't it spread to the other business units? Is it the Not-Invented-Here (NIH) syndrome?
EG: Before we dive into speculation about psychology of organiza- tions, let's examine the facts. We are talking about a middle manager who works in one corner of a large company. Why should we be surprised that, in five years, this person was not yet able to take his whole company through a major paradigm shift? And, by the way, as you read in his letter, he is making nice progress; he has already moved into a much more influential position.
DW: Still, even with enough time, is it possible for a middle manager to influence his whole company?
EG: Yes. But of course, such a person will need a lot of stamina and patience.
DW: What makes you so sure that it is possible at all?
EG: What evidence will convince you that it is possible?
DW: Give me an example of a middle level manager working for a large company who has succeeded in institutionalizing the usage of the know-how written in The Goal. I mean institu- tionalizing it across the board.
EG: Given that General Motors is the largest manufacturing company in the world, you should get an outstanding proof by interviewing
Kevin Kohls. (Eli Goldratt interview to be continued.)
Interview with Kevin Kohls General Motors
Director of Throughput Analysis and Simulation for North American Assembly Plants.
DW: What drove you to seek help from The Goal?
KK: It goes back almost 15 years, when I was starting off as a controls engineer at the Cadillac Detroit-Hamtramck assembly plant, just re- turning from Purdue University after completing a masters degree in electrical engineering. When I left a year and half earlier, the plant was just starting production. When I returned, they had yet to hit their production targets; in fact they were far short. As you might imagine, everyone was frustrated about not hitting these targets, and there was a lot of effort being expended to improve the system, with minimal results.
I was frustrated as well. The solutions I was putting in place rarely had a significant impact on the production of the plant, and it wasn't clear why. About that same time, Dave VanderVeen from GM Research made a presentation to Larry Tibbetts, who was then plant manager. Dave was promoting a research tool that he said would help improve throughput in the plant. Larry was very impressed, and asked me to go see Dave to find out if we could use this tool at Hamtramck. When I went down to the Research Building at the GM Tech Center in Warren, Dave explained what a bottleneck was and how his tool identified it. He handed me a copy of The Goal and said if you want to understand bottlenecks and how to improve throughput, this is the book to read.
I took the book home and started to read it right away. The first thing that surprised me was that it was written in novel format. The second was how much I could identify with what was happening in Alex's plant. I finally had to put it down at 2 A.M. so I could get some sleep, but I finished it the next day. I wanted to apply the concepts immedi- ately, so I began collecting data from the systems we had, and putting it into the bottleneck program. After about a week of effort, I was fairly certain I had found the bottleneck. The scary part is that it was not 20 feet away, on the production line right outside my office!
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DW: What was the problem?
KK: It was an operation where they were installing the fuzzy, felt-like material that goes in the ceiling of the car-very big and very clunky. Our data said that the mean cycles between failures was about five minutes, and the mean time to repair was about a minute. I was amazed that the line was stopping that often, and thought maybe the data was wrong, so we went and looked for ourselves. Sure enough, we watched the operator run for five cycles, stop the line, walk away, pick up five more of these big, bulky items-they weren't heavy but they were big-drag them back, restart the line, and continue to install them. Every five cycles she would stop the line. Was it considered a major problem before we looked at it? No. It's not like we were losing an hour straight of production because something had broken down. We were only losing one minute. But it was happening every five cycles.
We could see immediately why the material wasn't closer to the line. There was a supervisor's office in the way. We found out there had been a request made some time ago to move the office, but it was considered very low priority and it wasn't getting done. So I got the office moved, and lo and behold, throughput of the entire plant went up, which was a surprise, because my experience told me that I couldn't expect that. Then we used the software to find the next bottleneck and continued on with that process until we were making our throughput goals very steadily, every day. That was a real change in the way that plant operated.
DW: Did you take your insights to other GM plants?
KK: Yes. We demonstrated the process when central office manage- ment visited the plant, and it became apparent a lot of plants in GM weren't hitting their throughput targets. Eventually, I left Detroit- Hamtramck and went to a central office position to help start a divi- sional group to implement this solution. Seventeen years later, I'm an executive at GM who owns the process for all of the North American plants, and it has been expanded to include the simulation of future manufacturing designs.
DW: And this is all TOC related?
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KK: Yes, but there are other disciplines involved. You have to un- derstand simulation, and how it predicts throughput, and why it's important to understand where the bottleneck will be for a future design. But TOC is the basis for what we do. I still teach a two-day course. We might go to a plant and train the whole staff in how to use TOC concepts. I always give out copies of The Goal ahead of time and ask them to read it before the training. It's gotten to the point in manufacturing, however, where there are not that many people left to go through the training. My internal customers are usually very savvy now about TOC, bottlenecks, data collection and analysis. So I rarely have to sell the concept anymore. Demand for data collection imple- mentation to drive the bottleneck software, for example, exceeds our ability to install. And while I'm responsible for GM North America, this week alone I have people in China and in Europe working on these kinds of issues.