Our telephone-cable client was turning out new types of cable connectors in nine months. The new-product design team was convinced if the time was shortened, failure rates would rise. But we started calling around and found a Japanese company that was turning out new products with excellent quality in two-and-a-half months.
The design team was stunned. But when together we looked carefully at the design process, unnecessary steps and redundancies revealed themselves. As a result, our client was able to develop new products at the same quality in three months thereby getting to market faster. Sales volumes rose. The team was elated.
Our orange juice client wanted to reduce unit cost. But much of the cost was in the oranges coming from the growers. This cost was tied to quality. “Good-tasting orange juice requires tasty oranges,” said Walter, the head of manufacturing. “And these oranges are priced by the market. You can’t reduce this cost without compromising the product,” he said adamantly.
One day Walter and I were walking through the plant. We watched the orange trucks arriving, stopping on the scales at the entry point. A sample of fruit was taken from each truck to ensure overall quality. The grower would be paid for the weight of oranges in the truck.
After being unloaded, the oranges were carried by conveyor belt through the culling station. Bad oranges were removed, leaving good oranges to enter the juicer.
Suddenly Walter exclaimed, “Why not track the culled fruit back to each truck, and only pay the grower for the good oranges?”
The orange juice plant started doing this, which caused the growers to become more selective with what they put on their trucks. As a result, unit cost went down, throughput increased, and quality stayed high. Walter was delighted.
In each case our client moved beyond an apparent either-or. A solution previously unseen revealed itself.
