Customer Reviews

Rebirth of American Industry

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Over the past several months you've probably enjoyed Bill Waddell's hard-hitting posts on Superfactory's Evolving Excellence Blog (www.evolvingexcellence.com) as much as I have. His propensity to challenge the status quo with historical facts has been a breath of fresh air and has forced the lean community to think about the stability of its own foundation.

Bill, in collaboration with Shingo Prize winning author Norman Bodek, has just released a new book, Rebirth of American Industry - A Study of Lean Management. In it he uses his in-your-face style to take issue with several commonly-held lean beliefs, and the companies that mistakenly believe they are lean. The book has already received considerably acclaim from early reviewers.

Brian Maskell, President of BMA, Inc. and one of the leaders of the lean accounting movement, has this to say:

"This excellent book will make some enemies. It is outspoken, hard-hitting, and correct. The authors answer the question "whay have so few American companies successfully transformed themselves into lean organizations". They take us back to the origins of lean at Ford Motor Company and Toyota, and contrast them with the modern American manufacturer. The solutions advocated will be unpopular because they cut to the heart of "professional" management theory and show that the lean transformation must start not on the shop-floor but by active transformation in the executive offices."

Tom Johnson, author of Relevance Lost and the Shingo Prize winning Profit Beyond Measure, had this to say in the forward he wrote for the book:

"The central concern of this book is to outline the core principles in the Sloan management model that GM adopted after 1920 and to show how adhering to those principles makes it virtually impossible for managers to understand and adopt the principles inherent in Toyota's so-called "lean" operating system. The book also does well at showing how the "magic" of MRP software after 1960 further disguised the dead-weight impact of overhead cost. The authors properly describe MRP as a sophisticated effort to rationalize the damage to sound operations caused by following the Sloan model. "

I have always been fascinated by the history of lean, and this book does not disappoint. However as Bill points out in his introduction, this is not a history book... it is a management book. In any case, the supporting stories are priceless and help drive home the fallacies of the Sloan/Dupont ROI model. Such as Chrysler having 400,000 cars in finished goods at one point which required them to rent the empty Ford plant at Highland Park - ironically the birthplace of lean manufacturing - and they still believed they achieved a profit. As he has on this blog, he takes the Shingo Prize to task for awarding prizes to operations like Delphi that ended up failing the bottom line gut test of lean: they didn't make money.

One of my favorite chapters is "The Illusion of MRP", perhaps because that's the battle I've fought at several operations. After a quick review of the history of MRP, Bill discusses the attempts to integrate lean with MRP... and correctly concludes that the only way to reconcile lean and MRP is to turn MRP off. Looking at it from Taichi Ohno's perspective, would a manufacturing company that was operating on a philosophy of lead times of zero and lot sizes of one have any use whatsoever for an MRP system?

I highly recommend this book.

First thing I thought (and anyone I mention this book to mentions) is: "For $47 this had better be a good book!" It is. Don't let the price stop you from buying it. I gave it 4 stars only because the printing and quality are not top notch- something I would expect in a book of this cost. But look at it this way, you are not spending the money on a fancy book, you are spending it on the CONTENT of the book. In this case, if you use the content wisely, it could in fact be worth millions.

As a full time lean consultant and author, I am continuously frustrated by the lack of real success in Lean throughout manufacturing. I intuitively understand what is at the root of the limited success, but this book makes it clear. Every "manufacturing" company in the world- with the exception of Toyota and maybe a few others- uses a measurement system that will drive the business in the opposite direction of lean. It is so ingrained that virtually everyone is in staunch support of the old method. So, in any company, lean "success" can only go so far until it bumps up against the standard "Sloan method" of management. That's when everyone starts to panic and the wheels fall off.

I have worked in numerous companies where everyone could see and measure (using lean measurement of waste and time) a process and understand that overall it was more efficient and lower cost, but when measured with the standard measurement methods it loses, and is not adopted. It is a classic case of the Emperors new clothes. We can all see that the Emperor is naked, but no one is willing to step up and fight the fight. We are simply outnumbered and the fight is sure career suicide. Why fight it?

So we set up lean model areas, lean lines, and lean plants, and delude ourselves into believing that we have "become lean" but then in the next breath talk about "cutting heads" and "absorbing overhead" and really never change the organization (and never get the true benefits). We have all tried to make lean work within the context of the current system. We need a new system. This is not just "outside the box" thinking, it is starting with a completely new box, and it is not even a box. I have on a number of occasions been in plants that appeared lean. The superficial layer had all the lean bells and whistles, but closer inspection revealed a new facade plastered over decaying walls. The plant was no more lean, but had tape on the floor, painted floors, charts and graphs for wallpaper, and even one-piece-flow! But it was not lean because the lean work never made it to the people doing the work. It was all superficial.

As long as companies continue to use the Sloan model which views people as a variable expense (and as expendable at will), we will never achieve the true essence of lean- the power of the greatest asset. Toyota understands the power of the people and will say, "Only people can think. Only people can solve problems and make improvements. Only people can understand the desires of the customers. Therefore, people are our greatest strength."

I highly urge you to splurge on this book. Don't let the price keep you from buying it. You need to get it into the hands of your top leaders. Have discussion on what your current system drives you to do that is counterproductive. Keep pushing until everyone in your organization agrees that the current system of measurement and accounting needs to change, and then change it. It is the only way you will have true success with lean. If you do this book could be priceless.

Rebirth of American Industry is an important book. It blows the lid off many of the assumptions, processes, and metrics that have led our country down a road that has shipped millions of jobs overseas.

In order for the "Rebirth of American Industry" to take place, a great deal of pain will have to be incurred, unless we immediately challenge the existing norms and make some radical changes.

Death of waste, the elimination of all non-value added activities, must be pursued relentlessly. Birth of a new American heritage of producing with increased value to the customer, designing and delivering products, and providing services under world class conditions is mandatory.

In our free society the customer makes the choice of which products will be purchased and which will not. In a world of vast and instantly available information, with global competitors operating in our own backyards, the customer is indeed king. Companies that choose to ignore this fact do so at great peril.

Newsmagazines and commentators have blasted Wal-Mart, big box retailers, and global competition for our problems in manufacturing. The truth is that educated, knowledgeable customers with virtually unlimited choices wield more power than ever before. Our failures in manufacturing are a result of failing to meet the needs of these customers. In the words of Walt Kelly's Pogo "We have met the enemy - and he is us."

Just as the customer has been empowered under our free economy, we must move forward in educating and empowering our manufacturing employees to better serve that customer.

We must align our strategies, business processes, and performance metrics to the voice of the customer, and aggressively go after our leaner, more agile competitors.

This book provides a prescription that should lead American companies to return manufacturing to our shores, just as many of our global competitors have chosen to join us here.

A few years ago, I was at a football game, when I asked my best friend, who is an industrial engineer "What is all of this 'Lean' stuff I hear about?" He spent the next few years talking at length through examples and slides and presentations and e-mails from Bill Waddell's blogs. They were nice, but I didn't really 'get it'. I am a design engineer and my views before hand were that I don't understand business and those business leaders and accounting gurus just think at a higher level than me.

Then my friend gave me his copy of this book. I figured I would probably never read it and give it back to him in a few months. I figured it was written for 'Industrial Engineer nerds' and would be above my head. One night, as I am about ready to go to bed, I pick it up and decide to look at chapter 1, so I can at least say I tried to read it. All I can say is WOW!!!! 3 chapters later, I look at the clock and decide I should go to bed, since it then way past my bedtime. I spent the next few days blowing through chapter after chapter (and staying up too late). The scales fell off of my eyes and suddenly I saw the absurdity of modern business thinking and the beauty of lean. Before, I thought Lean was something like the kanban cards I used to stock my kitchen (yes, my friend did teach me this) on a wider scale, but it is so much more.

After this book, Bill's blogs made perfect sense. I started spreading the word to those around me about the absurdity of overhead absorption, lowest landed piece costs, making machines run around the clock when you don't need that many parts, creating bogus factory efficiency numbers, building unwanted inventory at the end of the quarter, and other absurd practices I noticed around me. Not only did Bill teach me lean, I was able to explain it to others.

You can read reviews from lean manufacturing experts who read this book, but I hope you will take special notice when I tell you that I have ZERO background in manufacturing and was utterly clueless about all such things, and this book changed how I view manufacturing. It's not written for like-minded manufacturing gurus. It is written for all of us who just didn't get it.

First of all, You should know, that I have received a hand-signed copy of this book for free. While this has absolutely no influence on my opinion about the book, if You don't believe that, please read on with the next reviewer.

In this book, Bill describes the hystory of manufacturing and management systems, starting from Henry Ford's legendary Highland Park plant, continuing with Eiji Toyoda creating the world's most famous car company, all the way to today's sad situation in GM, Ford and many other companies.

In particular, Bill focusses on what lean manufacturing meant in Ford's early days, and how this was embedded and supported by a lean, cash-driven management system. He continues with describing, how this business system was applied and brought to perfection in Toyota. As a contrast to these success stories, Bill describes in great detail the long evolution path of most businesses from successful manufacturing companies supported by finance and marketing into collapsing finance and marketing corporations with ever decreasing manufacturing performance.

Bill describes, how lean manufacturing with a strong focus on respect for people, quality, flow and synchronisation was as a natural result of a sound business system, combined with the need to create superior customer value with limited cash and the lack of a sophysticated controlling system.

He also shows, how disregarding people, quality, flow and synchronisation lead to today's typical large corporations, hiring and firing people as variable costs, facing countless quality issues and carrying mountains of inventory, which physically stops the flow of products and cash. Bill describes the wrong assumptions, priorities and fundamental errors of the DuPont / Sloan management system and shows, how the poor manufacturing performance of most companies is the natural result of adopting this system.

Bill calls for a radical change of what most of us treat for given, prooved and granted: the DuPont / Sloan management system. Decentralized command and controlling the key figures of cycle time (flow), total cost, quality, delivery performance and safety is what successful lean companies do and others, who truly want to become lean need to do as well.

All in all, a very interesting book, answering the fundamental dilemma of lean manufacturing: why so many companies adopting lean tools, methods and techniques fail to obtain positive bottom-line results... it is because, they are still managed by a fundamentally wrong business system.

In my opinion, there could be more real-life, tangible examples from our everyday business experience described in the book, in order to support the message. However, Bill's blog under www.evolvingexcellence.com more then compensates this, by giving us at least 1 every day.

Lean Six Sigma is being touted as the 'saviour' of performance management in the financial services industry. However it may simply be a refuge for the Black Belts from the manufacturing sector.
I've wondered in the past why the considerable investment in Lean Six Sigma by Ford, GM and Delphi didn't pay off - now I'm beginning to understand.
This is an important book that applies to all industries not just manufacturing.

If you're trying to answer the question, "Why does Lean often just become the 'flavor of the month' in organizations," this book does a good job of explaining. Standard cost accounting creates metrics that can make Lean strategies look unprofitable. The authors do a great job of reviewing the history of Lean manufacturing in the U.S. and the world. In fact, they debunk a lot of myths out there about its origins.

The reason I didn't give it 5 stars, however, is that I wanted a more in-depth explanation of how Lean impacts the financials, that therefore leads to Lean not being adopted. The authors, instead, made generalities with a few financial figures, that, if I were to use for a presentation to top management, wouldn't be convincing enough. And in this way, they failed their readers.

Otherwise, a great book to read that, at points, I didn't want to put down. Would recommend as a primer, but not sufficient alone.

This is an outstanding book that goes beyond lean manufacturing to an understanding of the culture of business in general and how that culture effects business outcomes. What Waddell and Bodek say about the training in MBA programs and its limitations for manufacturing specifically, and for business in general, is right on. The MBA just needs to realize that learning from one's mistakes does not devalue the knowledge learned, but rather makes the knowledge more well-rounded and moving on a righted course.

The book is easily accessible and written in a light style, however, it may be challenging if one is not prepared to question previous learning and assumptions. If one has already started down the road questioning the standard view, this book will provide solid grounding and support.

The book briefly mentions the possible future move toward scaled down, smaller manufacturing and I would have preferred to have had more on that topic, just because I would like to hear the opinions and thoughts of the authors.

Since this book is expensive, but certainly worth it. I encourage would be readers to read the following article by the author or visit the website.
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If this book doesn't make you burst into "God Bless America" nothing will! The exporting of manufacturing and jobs is draining the life blood from America. It's not labor that causes high costs; it's waste. These authors point the way to a rebirth not only of American Industry but a rebirth of America.

I read through this book and felt that there was some interesting facts and history related to progressions of management styles (Taylor -> present). However, the book is heavily biased against the current GAAP principles as it states that it encourages inefficient production due to inventory being treated as an asset. From my studies, inventory turns and other metrics can be used to see that a company is trying to treat inventory as a liquid asset. Overall, I think it is a worthy read for both historical content and alternative thinking for Lean principles.