The Phone Call
It was 8:00 on a Monday morning and my phone was already ringing. The call was from Bob, a distributor of mine in Kalamazoo. Bob was frustrated. He had just received a call from an upset customer. Bob’s customer was tired of waiting for their replacement windows. It had been seven weeks since the homeowner had placed the original order.
“I’ve been buying windows from you for the past two years,” Bob said. “You guys make a great product. It’s the best window on the market. Our customers love those windows.”
I cringed as I continued listening. There was a “but” coming, and I knew it.
Bob continued with, “But they don’t like waiting eight weeks to have them installed. My customers get upset, and we’re not getting the referrals from them like we used to. The delivery times are costing us business.”
I’ve heard this all too often, I thought to myself. For the past two years we had constantly improved our products. We attracted many new customers, but our production just hadn’t kept up with sales. We were upsetting customers as fast as we were acquiring them!
Bob ended the conversation with a statement that I had hoped he wouldn’t use. “Sam, get the delivery time down or you are going to force me to look for another supplier.”
My frustration level had grown to the same high level as Bob’s. We work too hard to get new accounts to just lose them, or our valued older accounts, because of poor production habits. I called a meeting.
The shiny new table that sits in my screened-in porch was jammed with people. There wasn’t an empty seat in the house. My two business partners were there along with the plant manager, the sales manager, three of our sales people, two line managers, the shipping clerk, and our newly hired director of operations.
A small cooler was on the floor in the corner. It was filled with refreshments, and there were some munchies on the table. This was not going to be a short meeting, and I wanted everyone to be comfortable.
I opened the meeting with a welcome. Then, I recanted the phone conversation that I had the day before with Bob. I ended my welcome and introduction by stating, “We have a challenge at hand, and if we are going to survive in this business, then we need to come up with a solution.”
There was silence around the table. One of my partners broke the silence by stating, “We have to have two week turn around times. We must make our windows in two weeks!” He was the partner in charge of production. I was in charge of sales and marketing.
“We’ve been hearing that for the past two years,” I stated. “I’m not as concerned with the what, I want to know how.”
I turned to Gary our sales manager and asked him, “What are you hearing from the other customers? What do they want?”
Gary said, “Well, our customers love the windows and doors. The quality is great, and the tremendous variety of options helps them make the sale. They just hate our delivery times. And, it’s getting harder and harder to walk in the customer’s door. They’re just so mad sometimes! It doesn’t pay to go out and get new customers and sell more, because we only create more problems when we do that.”
I did not like that last thought. We’re not selling because we don’t want the headache of poor delivery, is what Gary was saying. The three sales people also relayed the same message.
The plant manager just sat there with his head down, and so did the two line managers. Then my partner again reiterated, “We need a two week turn around time.”
I’d had it with that comment. Everyone in the room knew what we needed, but no one was willing to stand up and say how they thought we could get it done. I turned to my partner and asked a series of questions.
“When an order comes into the office how long does it take to enter it into the computer and check it?”
“One day,” he responded.“How long does it take to schedule and make the insulated glass for the windows?”
“That also takes one day,” he replied.
“What’s involved in production from that point?” I asked.
“We have to schedule the windows, cut the parts, assemble the parts, and then wrap the completed unit,” he said. He went on to say, “That whole process takes about a day and a half.”
The shipping clerk piped up and stated, “I can stage and pack the trucks in less then a day.”
I was writing everything down. Then I added up the times. “Four and a half days,” I stated. Then I turned to my partner and asked, “You feel that we need two week turn around, right?”
“Right!” He stated.
“So what you’re saying is that the orders should sit in the office for one week and then we should make the orders the next week?” I asked.
He paused but then reluctantly said, “Yes.”
So I asked, “Why do the orders need to sit for a week? Why don’t we just get the orders in and make them in a week?”
Then I turned to our new director of operations and asked, “What if we had a Friday cutoff for all orders. Any orders received by 4:00 on Friday afternoon would be entered and checked on Monday, the glass would be made on Tuesday, window parts would be cut and assembled on Wednesday and Thursday, and the completed windows packed on the truck and shipped on Friday?”
He rubbed his chin, thought philosophically, and said, “We could do that.”
My partner said, “Let’s get to two weeks first and then worry about one week. Right now one week is impossible.”
I asked the plant manager, “How long would it take to get this type of production system created and implemented?”
“We’re getting to the slow season. We could clean up our backlog and be ready to go in four weeks.”
I said, “Do whatever you feel is necessary to get the job done. If there is any way I can help just let me know.”
Everyone sat up. There was an energy level in the room that I hadn’t seen in a long time. Questions were flying, and thoughts were being shared. We had a goal. We believed. We had breathed new life into the company.
The next day the director of operations went to the factory workers and shared with them the outcome of our meeting. Then, he turned to them and said, “You’re the ones closet to the job. Do whatever you need to do to get your production lines running as efficiently as possible.”
The factory workers were excited. They had always been told what to do. No one had ever enlisted their input. The workers were even given special incentives like company lunches, and getting off early on Friday if the goals were met. They were on a mission. I was beginning to really like the new director of operations.
The workers changed the layout of their production lines and suggested changes in some of the ways work was scheduled. Over the next four weeks we cleaned up our backlog and made the suggested changes in the plant.
The big day came. We closed our orders out on Friday and began our new system. The next Friday our first truckload of windows went out. They were on time and everyone in the plant was excited.
Another Phone Call
Six weeks after we had made the dramatic changes and had proven ourselves my phone rang. It was a Monday at 8:00 AM. Bob from Kalamazoo was on the line.
“Good morning Sam,” he said. “I have a favor to ask of you. Could you delay our shipment this week?
“What’s that?” I asked.
He paused and then spoke, “Could you delay this weeks’ shipment?”
Concerned, I asked, “What’s wrong? Is there a problem with our quality? Did we make something incorrectly?
“No, No,” Bob replied. “It’s just that you guys are shipping windows and doors to us so fast that we can’t keep up, and our warehouse is full to the rafters. Our installers can’t get the windows installed as fast as you can ship them!”
“Bob,” I stated, “It sounds like you have a production problem. Maybe it’s related to your installation goals. You know Bob, the faster you get those windows installed the more referrals you’ll get.” I sorta chuckled inside.
“Bob, most successful companies isolate their biggest problems and then tackle them one at a time. You started us on that journey almost three months ago and look at the great job we’re doing today. Why don’t I come up and look at your production system? Together I’m sure we can figure out how to get the windows installed faster, boost referrals, make your company even more profitable, and you’ll be on your way to Building a Better Biz!”