Tag: continuous improvement

Apple’s Best Kept Secrets … May Be Their Worst Enemy

English: A ridiculous line of people waiting f...
A ridiculous line of people waiting for the iPhone 3G outside of the Apple Store on 5th Ave. between 58th St. and 59th St., NYC, July 12, 2008. I was not in the line. pictured: the Apple Store entrance (Photo credit: Wikipedia)

One of the roles of leadership is to instill and foster a culture that embraces change and empowers the team to improve. This call for change is also echoed in the Plan-Do-Check-Act or PDCA cycle that serves as a typical model for driving continuous improvement in many organizations. In this regard, Apple has clearly demonstrated their commitment to develop and improve their existing products.

As I’ve written many times before, “There’s always a better way and more than one solution.” From the outside looking in, Apple appears to embrace this thinking too, as evidenced by the unveiling of the new and much rumoured iPad Mini as well as announcing a number of significant upgrades to their existing product lines.

However, as the late great management guru Peter Drucker stated, “There is no business without a customer”. When we consider the numerous and diverse range of brand advocates a business may have, we also realize and understand that customers are very much a natural extension of the business itself. In this context, I contend that Apple’s best kept secrets may just be their own worst enemy.

Timing is Everything

From a leadership perspective, transparency, respect, accountability, integrity, and trust are just a few of the defining traits of a lean organization. The vision must be clear and understood to ensure that decisions, goals, objectives, and actions are aligned accordingly. Unfortunately, as customers, we can only rely on “leaks” and “rumours” to learn of Apple’s hidden agenda and attempt to plan our purchases accordingly.

While Apple may be lean at its core, I can only wonder how much waste is generated at the consumer level. Each new product introduction is met with a host of people ready to replace their existing devices with the latest and greatest technology Apple has to offer. It begs the question, “How many people can actually afford to keep pace with the current rate of change?”

In this regard, continuing to release new products at an ever-increasing frequency is quickly becoming a deterrent for people to “buy now.” The decision to purchase is offset by the potentially greater benefit of waiting just a little while longer. I contend that this is where Apple’s strategy may soon fall short. I’m not endorsing Samsung here, however, this Samsung Galaxy S3 ad has captured the point we’re making here:

Effective leadership understands that the timing for change is as critical as the change itself. If change occurs too frequently, people will abandon their efforts to embrace any of them knowing that another is already in the making.

Chasing the Dream

This television commercial, first aired during...

As a public company, Apple is subject to tremendous market pressures to maintain its record-setting trend of higher returns for shareholders and also serves to fuel a shorter cycle of new product introductions and upgrades. This rapid injection of perceived “new” technology is equally offset by higher rates of planned obsolescence.

While some of the changes announced were much-anticipated, especially the iPad Mini, the 4th generation iPad was a complete surprise – at least it was to me. Was the release date of the 4th Generation iPad so obscure that a 3rd generation product release was required only seven short months ago?

I have become increasingly concerned over the frequency that change occurs, especially when they directly affect my pocketbook. Frequent changes leave consumers little time to absorb them and their significance is rapidly diminished by the next generation of products that follow. From a lean perspective, the PDCA cycle encourages incremental improvements to – or within – an existing process or system and this is the consistent, fundamental flaw in Apple’s product development cycle:

Existing devices cannot be upgraded.

The majority of recent changes introduced by Apple are hardware related including the release of iOS6 as a necessity to support the new offerings. The new A6X chip, an integral part of the new iPhone 5 and the recently announced 4th generation iPad, offers twice the speed and twice the graphics performance over its predecessor, the A5X chip. Hardware changes of this nature are rarely an after thought and keeps me wondering why Apple was so compelled to release the 3rd generation iPad only a few short months ago.

Loyalty, Trust, and Making Amends

Many consumers are advocates of the Apple brand and their loyalty implies that a certain element or level of trust exists. With this in mind, the changes introduced by Apple carry an even greater significance as this trust is tested with each step that Apple takes. The decision to purchase an Apple device is as significant as the price tag it carries – they are expensive. Apple clearly understands this and created the new iPad Mini to bridge the price gap in kind, although it too carries a hefty price tag.

For Apple, change may be the norm but, for consumers it’s not always that simple. Apple clearly recognizes that consumers want the latest and greatest product offering available. The questions to be answered here are two-fold:

  1. How much are consumers willing to pay for a new device? and,
  2. How OFTEN (or how soon after) are they willing to purchase its successor?
Apple I at the Smithsonian Museum
Apple I at the Smithsonian Museum (Photo credit: Wikipedia)

In light of these recent announcements, a third and perhaps even more important question begs to be asked, “What is the relevant lifespan of my new device after purchase? The 3rd generation iPad’s core chip technology became obsolete in as little as 7 months from the date it was introduced and the relative value is sure to decrease even more rapidly with each generation that follows.

As mentioned earlier, the A6X chip was an integral part of the iPhone 5 and it is highly likely that integrating it into the 4th generation iPad was a known “next step”, long before the 3rd generation iPad was even released. I would suggest that the new iPad Mini, also built on the A5X platform, will also be short-lived as an A6X upgrade or even a retina display can’t be too far behind.

A company as large as Apple must have a product development plan and I challenge the ethics of a company that would knowingly lead consumers to purchase a “new” device that will become obsolete before they even take it out of the box. To make amends with recent buyers of the 3rd generation iPad, it has been suggested that Apple plans to offer free upgrades if their product was purchased within a certain time frame prior to the announcement of the 4th generation iPad.

I’m not opposed to any company that can make a profit, especially in today’s economy. However, Apple’s profits are borne by consumers who remain hopeful that Apple may actually provide a product that can deliver real value. It is peculiar and concerning that consumers are almost too anxious and willing to abandon their current devices for the “next best thing” as though their existing devices fell short of meeting expectations.

Now Serving … Shareholders

I am convinced that Apple’s primary interest is shareholder satisfaction at the expense of consumers by convincingly giving cause for consumers to part with their hard-earned dollars in pursuit of the “Next Big Thing.” In summary, the secret to Apple’s fortunes lies in ever shorter product cycles and even more frequent changes that give rise to increased product turnover, increased revenues, significantly higher profits, and ultimately higher returns for shareholders.

As we pursue our own lean efforts, we must be cognizant of the perception created when the need for change is driven by an agenda that is contrary to the vision of the company, namely, that of the shareholders themselves. You may recall the “noise” surrounding the valuation of Facebook’s IPO and shareholder concern over the process of creating and generating revenue. Even more profound (and to be applauded) was Mark Zuckerberg’s statement that Facebook intended to make money through the IPO to make Facebook even better – it was never Mark’s intention to make shareholders rich at the expense of FaceBook users.

I am always more than a little concerned when the influence of the stock market is greater than the vision that brought the company there in the first place. RIM serves as an excellent example of a company that has managed a fine line with shareholders to make leadership changes while still pursuing the release of the much-anticipated next generation BlackBerry 10 Operating System. While the changes announced by RIM were very well received, failing to provide a release date caused stocks to decline even further. Despite their announcements of cuts to the workforce, they have remained committed to pursue the next generation hardware and software. Time will tell how the market responds now that RIM has announced a January 30, 2013, product launch.

The Next Step

iPad in Subway
iPad in Subway (Photo credit: beatak)

With many thanks to Steve Jobs, Apple certainly deserves credit for shaping how we use computers today and Apple’s ability to create consumer frenzy for “What’s Next” is to be admired. Though Apple cites rapidly changing technology as the reason for its frequent product changes, I would challenge this statement as evidenced by the seemingly lower rates of change from Apple’s competitors.

On the whole, I find Apple’s products to be of high quality – though not without flaws – and extremely overpriced. The new iPad Mini and protective cover retail at $330.00 and $45.00 respectively and serve as just one example where the price far exceeds that of it’s nearest competitor. To make matters worse, a power adapter that should cost only a few dollars to manufacture retails at almost $30.00. Apple’s sales are staggering, however, their margins on sales are even more so.

I fully appreciate the craftsmanship of the Apple product line. The machines at all levels are exceptionally crafted and the user interface – at least on “touch” devices – is to be commended. However, from a software perspective, I have yet to see a serious professional suite that rivals that of Microsoft Office (Home or Professional). The release of iOS6 did nothing to improve my experience with Apple’s existing hardware or software.

The number of available “apps” is literally overwhelming and continues to grow at a daunting rate. Although many are either free or relatively inexpensive, finding an app that meets your needs can be a real challenge. I find many apps are overrated, lacking depth beyond the simple and individual functionality they provide. As a result, I tend to gravitate toward those apps (Evernote, Dropbox) where the scope also extends to competitor products as opposed to Apple specifically. As the major players continue to define and refine available hardware platforms, the App market may still be too fresh to establish the real dominant players in certain core segments.

Rather than waiting for a truly significant product upgrade, Apple has been too fast with too many incremental product changes that may leave some consumers suffering buyer’s remorse, feeling alienated, or worse – betrayed. Although RIM may be too long in the making of its BlackBerry 10 Operating System, Microsoft’s major Operating System releases are typically far and few between too.  Certainly Windows 8 has taken the market by storm with full touch screen integration for desk top, lap top, and ultrabook computers.

Perhaps the questions to be discerned are, “How soon is too soon?” and “How long is too long?” If it hasn’t been determined yet, there must be a “Goldilocks” cycle that’s just right: worth the wait and worth the money.

In Conclusion

I contend that Apple has succumbed to a greater concern for shareholders to sustain market share at the expense of customer trust and cash. To maintain their share of the market, they have taken their suppliers and competitors, namely Samsung, to court and seem compelled to pre-empt any new product announcement from their competitors with an announcement of their own – ready or not.

Apple provides a high quality premium priced product. Yet, as I look at the tools I have at my disposal (no pun intended) – a Mac Mini, iPhone 4s, and a 3rd generation iPad – I am underwhelmed by each of them. With all of the attention to detail that Apple seems to mind, I can’t help but wonder why something like the on-screen keyboard doesn’t reflect the current shift state of the keys – like my PlayBook does.

I have already heard rumours that a new iPhone 5s may be available in the first quarter of 2013. If memory serves me correctly, that should be just in time for RIM’s launch of the new BlackBerry 10 Operating System and the launch of  Microsoft’s Surface Pro. Of course, despite the rumours, who knows what or when the next surprise will be. I’m sure it will be sometime soon.

Only time will tell how long Apple can continue to keep customers “Chasing the Dream.” As for me, like a number of Apple’s recently resigned Apple executives, that chase is over.

Until Next Time – STAY lean

[twitter-follow screen_name=’Versalytics’ show_count=’yes’]

Vergence Analytics

Advertisements

Lean, OEE, and How to beat the “Law of Diminishing Returns”

Are your lean initiatives falling prey to the Law of Diminishing Returns?  Waning returns may soon be followed by apathy as the “new” initiative gets old.  For those who have not studied economics or are not familiar with the term, it is defined by Wikepedia as follows:

The law states “that we will get less and less extra output when we add additional doses of an input while holding other inputs fixed. In other words, the marginal product of each unit of input will decline as the amount of that input increases holding all other inputs constant.

In simple terms, continued application of time and effort to improve a process will eventually yield reduced or smaller returns.  The low hanging fruit that once was easy to see and resolve has all but disappeared.  Some companies would claim that they have finally “arrived”.  We contend that these same companies have simply hit their first plateau.

Methods and Objectives

Is it inevitable that a process has been refined to the point where additional investment can no longer be justified financially?  The short answer is “Yes and No”.  As the Olympics are well under way, we are quick to observe the fractions of seconds that may be shaved from current world records.  If you’re going for Olympic Gold, you will need every advancement or enhancement that technology has to offer to gain the competitive edge.  These advances in technology are refinements for existing processes that are governed by strict rules.  Clearly, there are much faster ways to get from point A to point B.  However, the objective of the Olympics is to demonstrate how these feats can be accomplished through the physical skills and abilities of the athletes.

In business our objectives are defined differently.  We want to provide (and our customers expect) the highest quality products at the lowest cost delivered in the shortest amount of time.  How we do that is up to us.  Lean initiatives and tools such as overall equipment effectiveness (OEE) can help us to refine current processes but are they enough to stimulate the development of new products and processes?  Or, are they limited to simply help us to recognize when optimum levels have been achieved?

Radical change versus refinement

Objectives are used to determine and align the methods that are used to achieve a successful outcome.  This is certainly the case in the automotive industry as environmental concerns and availability of non-renewable resources, specifically oil and gas, continue to gain global attention and focus.  The objectives of our “transportation” systems are being redefined almost dynamically as new technologies are beginning to emerge.  At some point, the automotive industry leaders must have realized that continuing to refine existing technologies simply will not satisfy future expectations.  With this realization it is now inevitable that a radical powertrain technology change is required.  Hybrid vehicles continue to evolve and electric cars are not too far behind.

How to Beat the Law of Diminishing Returns

Overcoming the law of diminishing returns requires another look at the vision, goals, and objectives of the company and to develop a new, different, or fresh perspective on what it is you are trying to achieve.  The lean initiatives introduced by Toyota, Walmart, Southwest and many others were driven by the need to find a competitive edge.  They recognized that they couldn’t simply be a “me too” company to gain the recognition and successes they now enjoy.

The question you may want to ask yourself and your team is, “If we started from scratch today, is this the result we would be looking for?”  The answer should be a unanimous and resounding “NO”.  Get out your whiteboard, pens, paper, and start writing down what you would be doing differently.  In other words, it’s time to re-energize the team and refocus your goals and objectives.  Vision and mission statements are not tombstones for the living.  5S these documents and take the time to re-invigorate your team.

Turning a company around may require some new radical changes and we need to be mindful of the new upstarts with the latest and greatest technology.  They may have an edge that we have may just haven’t taken the time to consider.  We are not suggesting that you need to replace all the equipment in your plant in order to compete.  Proven technologies have their place in industry and the competitive pricing isn’t always about speed.  The question you may need to consider is, “Can our technology be used to produce different products that have been traditionally manufactured using other methods?”

While many companies pursue a growth strategy based on their current product offerings and derivatives, we would strongly suggest that manufacturers consider a growth strategy based on their process technology offerings.  What else can we make with process or machine XYZ?  We anticipate that manufacturing sectors will soon start to blend as manufacturers pursue products beyond the scope of their current industry applications.

Be the Leader

Leading companies create and define the environment where their products and services will thrive.  Apple’s “iProducts” have redefined how electronics are used in everyday life.  As these tools are developed and evolve, so too can the systems and processes used throughout manufacturing.  The collective human mind is forever considering the possibilities of the next generation of products or services.

There was a time when manned space flight and walking on the moon were considered unlikely probabilities.  Today we find ourselves discovering and considering galaxies beyond our own and we don’t give it a second thought.  How far can we go and how do we get there?  The answer to that question is …

Until Next Time – STAY lean!

Agility Through Problem Solving: a Model for Training and Thinking

We tend to use analogies when we are discussing certain topics, introducing new concepts, or simply presenting an abstract idea.  Analogies are intended to serve as a model that people understand, can relate to or identify with, and, more importantly, remember.  Our challenge is to identify a simple model that can be used to teach people to identify and solve problems – a core competency requirement for lean.

We have learned that teaching people to see problems is just as important as teaching them to solve problems.  Our education system taught us how to use the scientific method to solve problems that were already conveniently packaged in the form of a question or modeled in a case study.  Using case studies for teaching is typically more effective than traditional “information only” or “just the facts” methods.  (The government of Ontario is presently considering a complete overhaul of the education system using case studies as a core instruction method.)

The effectiveness of any training people receive is compromised by time – the retention span.  Our school systems are challenged by this at the start of every school year.  Teachers must re-engage students with materials covered in the last semester or topics covered prior to the break.  In business we may be too eager to provide training at a time when current business activities are not aligned for the new skills to be practiced or exercised.  A commitment to training also requires  a commitment to develop and routinely exercise these skills to stay sharp.

One of the fundamental rules of engagement for lean is to eliminate waste, where value added activities are optimized and non-value added activities are reduced or eliminated.  Although it may appear that we have identified the problem to be solved, in reality we have only framed the objective to be achieved.  We understand that the real solution to achieving this objective is by solving many other smaller problems.

The Sudoku Analogy – A Model for Finding and Solving Problems

A favourite past time is solving Sudoku puzzles, the seemingly simple 9 x 9 matrix of numbers just waiting for someone to enter the solution.  The reasons for selecting and recommending Sudoku as an introductory model for training are as follows:

  1. Familiarity:  Sudoku puzzles are published in all daily newspapers and numerous magazines and they have become as popular as cross-word puzzles.  Most people have either attempted to solve a puzzle or know someone who has.
  2. Rules of Engagement:  the rules of the game are simple.  Each standard Sudoku puzzle has 9 rows and 9 columns that form a grid of 81 squares.  This grid is further divided into nine 3 x 3 sub-sections.  The challenge is to enter the digits 1 through 9 into the blank spaces on the grid.  Every row, column, and 3 x 3 sub-section of the grid must contain one and only one of each digit.  We refer to these as “rules of engagement” as opposed to “framing the problem”.
  3. Degrees of Difficulty:   Sudoku puzzles are typically published in sets of 3 puzzles each having varying degrees or levels of difficulty.  Each level typically requires more time to complete and requires the player to use more complex reasoning or logic skills.  The claim is that all puzzles can be solved.
  4. Incremental or Progressive Solutions:  Sudoku solutions are achieved incrementally by solving instances of smaller problems.  In other words, the solution builds as correctly deduced numbers are added to the grid.  New “problems” are discovered as part of the search for the final solution.
  5. Variety:  every Sudoku game is different.  While some of the search and solve techniques may be similar, the problems and challenges presented by each game are uniquely different.  Although the rules of engagement are constant, the player must search for and find the first problem to be solved.
  6. Single Solution:  a multiple number of solutions may appear to satisfy the rules of the game, however, only one solution exists.  Learning to solve Sudoku puzzles may be a challenge for some players, however, even seasoned Sudoku players can be stumped by some of the more advanced level puzzles.  To this end, they are ever and always challenging.
  7. Skill Level:  Sudoku puzzles do not require any math skills.  Numbers are naturally easier to remember and universal.  Letters are language dependent and the game would lose international appeal.
  8. Logical:  deductive reasoning is used to determine potential solutions for each empty square in the grid.  As the game is played, a player may identify a number of potential solutions for a single square.  These final solution will eventually be resolved as the game is played.

In practice

We recommend introducing the team to Sudoku using an example to demonstrate how the game is played.  It is best to discuss some of the strategies that can be used to find solutions that eventually lead to solving the complete puzzle.  The Sudoku model will allow you to demonstrate the following ten objectives:

  1. Look for Options:  The solution for the problem to be solved may consist many other smaller problems of varying degrees of difficulty.
  2. Break down the problem:  There may be more than one problem that needs to be solved.  Every Sudoku puzzle represents many different problem instances that need to be resolved before arriving at the final solution.  Each incremental solution to a problem instance is used to discover new problems to solve that also become part of the overall solution.  This may also be termed as progressive problem solving.
  3. Multiple solutions – One Ideal:  There may be times where more than one solution seems possible.  Continue to solve other problems on the grid that will eventually reveal the ideal single solution.
  4. Prioritizing:  more than one problem instance may be solvable at the same time, however, you can only focus on one at a time.
  5. Focus:  Problem solving involves varying states of focus:
    • Divergence:  Expand the focus and perform a top-level search for a problem from the many to be solved
    • Convergence:  Narrow the focus on the specific problem instance and determine the specific solution.
  6. Test and Validate:  Every problem instance that is solved is immediately verified or validated against the other squares on the grid.  In other words the solution must comply with the rules of engagement.
  7. Incubation:  some puzzles can be quite difficult to solve.  Sometimes you need to take a break and return later with a fresh eyes approach.
  8. Action:  There is no defined or “correct” starting point.  The first problem instance to be resolved will be as unique as the number of players participating.  No matter where you start, the finished solution will be exactly the same.
  9. Tangents:  when entering a solution into a square, you may notice other potential problems or solutions that suddenly seemed to appear.  It is very easy to digress from the original problem / solution.  This is also true in the real world where “side projects” somehow appear to be the main focus.
  10. Method:  There is no pre-defined method or approach to determine what problem to solve first.  The only guiding principles for discovering the problem instance to be solved are the rules of engagement.

Lean companies train their teams to see problems and break them down into smaller problems with solvable steps.  Sudoku demonstrates the process of incremental or progressive problem solving.  Even with this technique it is possible to enjoy major break through events.  There are times when even seasoned Sudoku players will recognize the “break through point” when solving a puzzle.

Solve time is another element of the Sudoku puzzle that may be used to add another level of complexity to the problem solving process.  Our objective was not to create a competitive environment or to single out any individual skill levels whether good or bad.  Lean is a TEAM sport.

In Summary:

Sudoku solvers are able to hone their skills every day.  Perhaps Sudoku Masters even exist.  Imagine someone coming to work with the same simple focus to eliminate waste every day.  Although there is no preset solution, we are able to identify and consider any number of potential problems and solve them as quickly as we can.  The smaller problems solved are a critical part of the overall solution to achieve the goal.

Most professional athletes and musicians understand that skills are developed through consistent practice and exercise.  Repetition develops technique and speed.  Imagine a culture where discovering new opportunities or problems and implementing solutions  is just a normal part of the average working day.  This is one of the defining traits that characterize high velocity companies around the world.

Truly agile companies are experts at seeing and solving problems quickly.  They discover new opportunities in every day events that in turn become opportunities to exercise their problem seeing and solving skills.  Crisis situations are circumvented early and disruptions are managed with relative ease – all in a days work. 

The next time you see a Sudoku puzzle you may:

  • be inclined to pick up a pencil and play or
  • be reminded of the time you were inspired by the game to solve problems and reach new goals or
  • simply reflect on this post and ponder your next break through.

Until Next Time – STAY Lean!