Aussie & Kiwi Reflections

By Pascal Dennis

A Simple Twist of Fate

As you may know, I was in Oceania for almost a month.

Among the highlights was meeting my Aussie cousin, Chris Stavridis, in Melbourne, during the Australian AME Conference.

My mother had told me we had Aussie family and I'd emailed Chris in advance. A cold call, in effect, and I wasn't sure if anything would happen.

On the third day of my visit, just after the day's end Speaker Panel, my cell phone rang.

A loud Aussie voice rolled out, big as a beach ball!

"HOW ARE YOU, COUSIN!? DON'T GO ANYWHERE. I'M ON MY WAY!"

Soon we were sitting on bar stools beside the Yarra River, shooting the breeze like old mates.

My maternal granddad, Stavros, and his, Fotis, were brothers, born in Kastoria, a lovely, ancient town in northern Greece's lake district.

One side of the family came to America. The other took the month long voyage through the Suez Canal, across the Indian and Pacific Oceans, into the Great Southern Ocean.

This took guts - I took the Great Ocean Road west of Melbourne, aka The Shipwreck Coast. The sea seemed a boiling cauldron.

Like me, Chris has three kids. He's proud of his heritage, yet is 'as Aussie as they come'.

We had dinner on Bridge Street in Melbourne's Richmond neighbourhood. Chris regaled me with stories of the neighbourhood's working class roots, and strong Greek contingent.

After dinner, I met Chris' extended family, looked at old photographs, so similar to our families, and told stories.

But for a simple twist of fate, I'd have been born & raised in Melbourne.

"How did our grandfathers decide which continent to settle in?" I asked Chris.

"I think they flipped a coin," he responded.

I love Toronto & North America, but Melbourne would have been just fine.

Our families are now connected by Facebook, of course, and our world has gotten bigger.

Yiasou Chris,

Aussie & Kiwi Chronicles - Part 5

Can High Cost Countries Afford Bad Management?

By Pascal Dennis

In my earlier blogs I wrote about my misadventures with Qantas.

A major national airline, indifferent to its customers, wracked by poisonous labor relations, the butt of cynical jokes at home.

Which raises another question:

Can Australia, a high-cost country overly dependent on mineral wealth & capricious mineral markets, afford bad management?

Much enjoyed exploring such questions with my Aussie mates, while sampling splendid wine.

Australia, they told me, is terribly vulnerable to bad management, and to bozo unions & nitwit politicians.

In good times, high mineral prices mask these debilitating weaknesses, which tend to fester.

When mineral prices collapse, as they always do, the economy follows.

A high cost economy cannot afford bad management. Resource wealth is only a temporary buffer, and might even be a curse.

High cost countries that lack natural resources - such as Denmark, Switzerland, Germany, Sweden, and even Japan - seem much more resilient.

Bad managers, bozo unions and nitwit politicians seem to have shorter half-lives in such countries.

(Japan may be an exception, at least with respect to the latter...)

My Danish colleagues tell me, "We realize we are small, unimportant, and vulnerable. We learn to become self-reliant, and to get along."

Or, as my Aikido sensei used to say, "The knife is sharpened on the stone, Pascal-san..."

Cheers

Manufacturing in a High Cost Environment

By Pascal Dennis

Aussie & Kiwi Adventures, Part 4

Last blog, I was having a fine dinner in Perth, Australia, with the great Dr. Goran Roos, noted business guru, and "Thinker in Residence" at Australia's Adelaide University.

We were in strong agreement that manufacturing is the cornerstone of any economy, and especially a high-cost economy like America, Canada or Australia.

"So what are key enablers of manufacturing excellence, in a high-cost economy?" I asked.

Dr. Roos elaborated on the following list:

1. Close to the customer - deep understanding of Value
2. Capable management - and Lean is a core capability
3. Strategic focus
4. Global perspective
5. Decentralization - we invest in our people & trust them to make good decisions
6. Profound knowledge of our field & work
7. Loyal, capable, low turn-over employees
8. Innovation through market partnerships & hassle-free innovation management systems

Seems a little bit like the Toyota Business System, no?

I was especially interested in element 8. Perhaps I can take up the topic in an upcoming blog.

Dr. Roos was especially gracious with respect to my talk on Getting the Right Things Done, which connected many of these points.

"This is an extremely PRACTICAL system," he said.

Thanks Goran.

Best regards,

Pascal

Why Manufacturing Matters

By Pascal Dennis

Aussie & Kiwi Adventures, Part 3

It was my distinct pleasure to meet Dr. Goran Roos in Australia.

Goran is a noted international business guru, and "Thinker in Residence" at Australia's Adelaide University. (I recommend his work warmly.)

We had a pleasant dinner in Perth, looking over the Indian Ocean and freely shooting the breeze.

Goran and I are kindred spirits on the importance of manufacturing.

In my experience, gained working in North America's 'rust belts', healthy societies cannot subsist entirely on service work.

"If service work is so great," I reflected, "why are towns that have lost manufacturing plants still barren, years later?"

"Your instincts are right," Goran replied. "There has to be a reliable net inflow of cash."

He then expanded his argument and backed it up with data. Here's why manufacturing matters:

1. Biggest spender of applied research & innovation -- with spill-over effects into the rest of the economy


2. Key driver of productivity improvement, with yet more spill-over effects


3. Makes up the biggest share of world trade and hence is critical for export earnings that pays cost of importing things


4. Largest driver of high value services so is critical for the high end of the service economy


5. Each job in manufacturing generates on average 2 to 5 jobs in the rest of the economy


6. Each $ of turnover in the manufacturing sector generates $1.74 turnover in the rest of the economy


7. Underpins construction & the resource sector


8. Integral part of business services sector


9. Underpins public sector

Thankfully, many countries, including America & Canada are waking up from the long nightmare of thoughtless outsourcing.

(Hearing the so-called pundits extol outsourcing's inevitability, I used to wonder, "While you're at it, why not outsource thinking too?")

Goran's thoughts on key enablers for manufacturing success?

Tune in next time!

Best regards,

Pascal

Aussie & Kiwi Adventures, Part 2

By Pascal Dennis

Thanks for your feedback to the question I posed last time:

How can Qantas, a major company in a highly competitive market, be so indifferent to the customer?

You'll recall that, among other failures, Qantas lost my bags - both going & coming home! And provided no easy means of providing feedback or seeking recourse!

Here are some common themes in your responses:

"Qantas doesn't care because they're an oligopoly in Australia."

"Qantas knows the government (i.e. the Australian tax payer) will always bail them out!"

"Service levels, in general, are substantially lower in Australia than in other countries. Knowing no better & having no alternative, Australians think Qantas behavior is normal."

I defer to our readers' insights, and especially, those of our Australian colleagues. If true, these comments provide important lessons for policy makers.

• In the absence of competition, the customer, and the concept of Value, will be forgotten. Waste will increase exponentially


• Accept oligopolies only as a last resort, therefore. Seek to foster competition so that the customer is not forgotten.


• If your market is small & can only sustain a very small number of companies, compel the company to provide, through legislation if need be, hassle-free recourse for customers.

What kinds of waste did I experience dealing with Qantas?

Transportation, Delay, Motion, Over-processing, Defects...

Qantas also experienced these forms of waste, as well as, Work-In-Process (my lost luggage - and me!), and Knowledge.

For Qantas, the latter waste is the worst of all. By scorning customer feedback, they'll never improve.

This is what happens when the Customer is forgotten.

So, for Lean thinkers, the most important questions remains: WHO IS YOUR CUSTOMER?

Best,

Pascal

Aussie & Kiwi Adventures, Part 1

By Pascal Dennis

Just returned from three weeks in Oceania.

Splendid adventures in a beautiful part of the world - a business nomad's delight.

My Aussie & Kiwi colleagues were gracious, kind & understandably proud of their countries.

(Special thanks to my mates Matt Wall of Boeing Australia, and Mike Butler of Fonterra NZ. I hope I can reciprocate when you visit North America!)

Forgive me for leading off with the only negative part of my journey - another unhappy adventure in international air travel.

But there may be some useful lessons.

Qantas, Australia's national airline, managed to lose my bags - both going & coming home!

Other hassles too, which I'll not bother describing, and all on a business class ticket!

When I went to the Qantas home page to share my story - feedback which top-shelf companies would consider invaluable - I found it was impossible to do so.

Qantas makes it very difficult for customers to provide feedback (!?)

A few minutes of web research confirmed that many other travellers have had a similar experience - with no recourse.

Qantas' message appears to be, "Who cares?"

My misadventures surprised neither my Oceania colleagues, nor the various Lost Baggage attendees I spoke with.

"Qantas is the worst..." and "At least they're consistent!" were common refrains.

My Aussie chums questioned the capability of Qantas' CEO & management.

Labor relations are so bad that Qantas grounded its entire fleet in 2011 and early 2012!

How can a major company in a highly competitive market be so indifferent to the customer?

I welcome feedback, especially, that of our Oceania colleagues.

For my part, I was struck by the painfully obvious absence of:

1. Standardized work, and
2. Embedded OK/Not OK tests

At every Lost Baggage desk, Qantas staff seemed unsure of what to do - in the face of a common defect!

Nor did there appear to be easy ways of confirming a Good/No Good condition.

And thereby hangs a tale of importance for Australia's future.

More next time.

Pascal