Long Term Excellence - Honda vs. General Motors examples

The recent View From The Q column challenged us how to sustain excellence in the long-term for our organizations.

I thought about how Honda started off as a company making piston rings and motorized cycles for Japanese markets, and through their approach progressed to became a global leader in many industries including automotive, airplane manufacturing, power motor products (i.e. lawn mowers, gardening devices), power generators, and other industries.  This is supported by an enviable logistical supply chain and information management organization that serves Honda across different markets and cultures.

From this example, the most important thing is to have an audacious vision, and commit to doing everything possible to realize those incredible goals.  Imagine fifty years ago when the Beach Boys were singing about their Honda Honda.

While the music fans of the 1960s were praising Honda for their cycles, the brain-trust was contemplating designs for international race cars, luxury vehicles, and organizational innovations.

Long-term excellence requires a long-term 50 year view of people and organizations.  If we can follow the example of Honda, we can envision ourselves as international leaders, and use that vision to drive choices and habits which complement and contribute to the realization of that audacious vision.

In turn, anything that conflicts with that vision; namely apathy, lethargy, sloth, tolerance of sub-standard outcomes, compromises of integrity, and other maladies would surely be resisted in an environment where everyone has bought into the vision and is working toward its fulfillment.

Consider in contrast the Chevy Corvair.  This was the product of General Motors (a company so entrenched that the maxim was coined "What's good for General Motors is good for America"), which had ample financial resources, but very unsound business practices that prompted consumer advocate Ralph Nader to declare this particular vehicle design "Unsafe at Any Speed".

Fifty years ago, it would have been ludicrous to think that a Japanese manufacturer of piston rings and motorcycles would compete and surpass the largest and most established leader in motor vehicles.  

The difference between the two organizations was the vision, and the internal ethic driven to fulfill that vision.  If your organization is not passionate like Honda, then it will be compelled to follow a fate similar to General Motors.

Deming on Labor Day

Today is Labor Day, which is celebrated in Canada and USA as a tribute to workers, and a time to reflect on what can make the workplace better.

The sentiments range from pride and patriotism, to resentment and frustration.  Labor Day draws attention to may controversial topics including minimum wages, working conditions, and the increasing expectation of employees needed to survive and thrive in this global market.

Deming identified this decades ago in his writings, succinctly summarized as the Seven Deadly Diseases.  According to The Deming Institute , many of the issues currently faced by workers during 2013 Labor Day were anticipated and could have been prevented had our organizations abided by Deming's wisdom, by working to avoid the appearance and proliferation of these Deadly Diseases.

1. Lack of constancy of purpose to plan product and service that will have a market and keep the company in business, and provide jobs.

2. Emphasis on short-term profits: short-term thinking (just the opposite from constancy of purpose to stay in business), fed by fear of unfriendly takeover, and by push from bankers and owners for dividends.

3. Evaluation of performance, merit rating, or annual review.

4. Mobility of management; job hopping.

5. Management by use only of visible figures, with little or no consideration of figures that are unknown or unknowable.

6. Excessive medical costs.

7. Excessive costs of liability, swelled by lawyers that work on contingency fees.

Think of every major Labor issue - the root causes are traceable back to one of these deadly diseases that ultimately consume the efforts and energies of organizations to the detriment of the overall quality of their product or service solution.  

Deming recognized, and others have since repeatedly proven, that workplaces characterized by engaged and focused employees, working from methodical systems and processes, succeed and outperform their competitors in quality, profitability, and sustainability.  

Contrast that with the records of those characters on the polar opposite of Deming.  A quick internet search revealed a notorious executive, "Chainsaw Al" Dunlap, who was celebrated for his ruthless cost-cutting, plant closures, employee terminations, and stock price gains until allegations of revenue inflation and accounting fraud ruined his reputation.  "Chainsaw Al", through his aggressive and adversarial approach to his workplace infused his companies with the diseases mentioned by Deming.

As we reflect on Labor Day, the choice of our workplace is simple: 

• Adopt and embrace the philosophies and practices of Deming and his advocates or;
• "Chainsaws" will be visiting your organization soon