Icebergs Lead to Titanics

A successful improvement movement can sometimes trigger its own failure

So, we have a process improvement program installed. Our people are trained or are getting trained. We have a list of prioritized improvement efforts, and we are attacking that list concertedly. We are tracking our improvement benefits, and the numbers are good. What could possibly be wrong?

Hopefully, nothing is wrong. Sometimes, though, process improvement success leads to grumbling, and not just the grumbling that come with change; honest people-discouraged grumbling. Where does this come from?

There are, in my experience, two common sources of genuine pain and morale depletion that occur when we start to have improvement success. The first generally comes from those who are responsible for driving the changes and making the improvements. They begin to perceive an enormous quagmire of never-ending problems.

The second source of pain comes from those witnessing the changes and improvements that are taking place around them, but their own problems are left behind, or are made worse. Coincidentally, one phenomenon leads to both pains. It is the proverbial “iceberg” effect.

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Comments

Value of personnel-hours

[S]everal thousand man-hours were probably used for genuine value-added work, or could have been at least, but because we can’t prove it, and because we didn’t reduce the workforce, we can’t calculate it. But we all know that several thousand man-hours gained back is a good thing...

I work for an engineering services company that bills by the hour. We hear comments from customers like, "we can do that cheaper in-house" because they have this idea that their engineers' time is "free" or that their staff will be more productive than ours. But calculating all costs related to a full-time employee will often show otherwise.

I sympathize with the difficulty of "proving" that time saved is money saved or productivity gained. But if an improvement activity is really going to be a significant time-saver, I think it's worth the effort to try. At the very least, you can either use the employee hourly rate, or take the salary and divide by 2,000 to get an hourly rate. Then multiply by the estimated number of unproductive work-hours eliminated to get the expected savings. Alternatively, you can point out that time saved doing one task can be applied to other priorities. Aren't there always plenty of "we'd do X if we only had the people" items around?

Jeff