A Long Overdue News Roundup


Lots of interesting and curious news to contemplate lately …

Give Boeing a round of applause

Lots of bad publicity about Boeing recently in light of their 787 debacle, but give credit where it’s due. Five Snohomish County nonprofits will be learning about spaghetti charts, value stream mapping, kaizen and 5S over the next several months in an effort to streamline or “Lean” the delivery of services. The $25,000 in grants, funded by The Boeing Company and administered by United Way of Snohomish County, expands the number of nonprofits using the technique first pioneered by Toyota in the 70s.”

Senior Services of Snohomish County, Center for Human Services, Work Opportunities, Domestic Violence Services of Snohomish County and Interfaith Association will all get a kickstart on the lean journey thanks to Boeing.

The biggest waste heap the world has ever seen

Maersk is building the biggest container ships in the world. Dwarfing the Titanic and almost as long as the Empire State Building is tall, these bad boys will carry 6,000 containers full of inventory. “Practically speaking, a Triple-E, in one trip, could take more than 182 million iPads or 111 million pairs of shoes from Shanghai to Rotterdam. Such a trip would take 25 days and burn 530,000 gallons of fuel.”

Some of the highlights:

Maersk’s ships account for 0.1 percent of humanity’s carbon emissions.”

Fuel costs for a one-way trip from Rotterdam to Shanghai can easily reach $2.5 million.”

The boys at Maersk are not completely oblivious to energy waste, however. Instead of the usual 23-25 knots this ship is designed to go 16 knots to save on gas. I suppose once you have decided to put 111,000,000 pairs of shoes into inventory you have poured so much money down the drain that stretching out the cycle time creating even more waste is no big deal.

Open Season on McKinsey

McKinsey bashing has become popular sport lately. The Sydney Morning Herald has these gems:

“It's hard to argue that a McKinsey associate has anything to offer the clientele but long nights.”

It is often goes unmentioned, but McKinsey has indeed offered some of the worst advice in the annals of business. Enron? Check. Time Warner's merger with AOL? Check. General Motors' poor strategy against the Japanese automakers? Check. It told AT&T in 1980 that it expected the market for mobile phones in the United States in 2000 would amount to only 900,000 subscribers. It turned out to be 109 million. The list goes on.”

Time Magazine offers:

They [McKinsey] sell what their clients are buying.”

The firm [McKinsey] dares to suggest that young MBAs with no actual business experience are in a position to tell seasoned executives how to better run their businesses.”

“McKinsey might be the single greatest legitimizer of mass layoffs in history.”

Gee, ya really think the Chinese might be lying?

In an article that is news to the folks at the BBC but rather pedestrian knowledge among those who have actually been to China, the Brits write about “The Trouble With Chinese Data”. Seems they have figured out that the Chinese have been overstating their economic output … by quite a bit.

Now, 28 companies in Luliang county in Yunnan province have reported industrial output that was more than double what their actual production was last year. According to Xinhua, the companies defended themselves and said that local officials had induced them to do so in exchange for loans from state-owned banks. The trouble with Chinese data is that government officials have been set targets in the successive Five-Year Plans that govern the country's economic planning. And no official would want to miss their target. So, it probably creates an upward bias in their reporting and overstates Chinese growth.

It probably creates an upward bias? Probably? Of course it does – and has for years!

We Won’t Have Furniture Brands to kick around any more

In my Evolving excellence days I had a few things in my hip pocket to pull out whenever writer’s block set in. One of them was Furniture Brands. Perhaps the goofiest, most mismanaged company in American I knew I could always count on them for a hoot.

Like the time their CEO said, “Part of the change in culture at Furniture Brands has been in shedding the manufacturing mindset that has kept us focused on capacity utilization, backlogs and other operational issues.”

And when another exec went to the trade commission and testified, “Furniture Brands is the largest residential furniture manufacturer in this country,” in an effort to get them not to slap tariffs on Chinese goods; and less than two months later that same exec was quoted in their annual report saying, “I have frequently pointed out that we are not really a manufacturer.”

Search the blog at EE and you can see a litany of lunacy at Furniture Brands, closing plants moving to Mexico and then China, one restructuring strategy after another.

Too bad we won’t have Furniture Brands to kick around any more. “Furniture Brands International said Monday that it has filed for Chapter 11 bankruptcy protection and hopes to sell the bulk of its business to investment firm Oaktree Capital Management, an investment firm that specializes in buying assets from bankrupt companies.” I’m almost going to miss them.

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