For Low Costs And Happy Customers Create Flexible Automation
Topics: cost, profit, speed, improvements, entrepreneur, leader, manager, planning, business model
The General Motors approach to automation has been inflexible. It did optimize costs if you made tremendous numbers of exactly the same vehicle. If you needed to change over to offer vehicle variations, the robots needed a lot of tending.
Toyota countered that challenge by automating relatively stable processes such as the link between a customer’s order in a dealer showroom and the parts order process, while not automating that which would be desirable to change quickly such as providing any extra features a customer wanted.
Flexibility is an important point for two reasons. First, customer satisfaction soars when customers can have just the features they want without waiting. The traditional assembly line produces lots of standard cars that the manufacturer and dealers then try to sell at the best price. Only a small number of customers want exactly the features a particular vehicle has.
You can order a custom-made car or truck with just the features you want, but there’s a long delay in many cases. In some automotive companies, these custom cars cost a fortune to produce. You take the standard car and rebuild it into a custom car. This method of customizing also means that the car is more likely to have faults.
Second, those who assemble cars hate assembly lines. They find it hard to stay focused. As a result, more errors creep into the cars they produce.
The Toyota assembly teams, by contrast, enjoy the variety of tasks they do and like being part of a team. This team-based assembly process means that the Toyota teams make fewer errors due to higher morale and having more eyes looking out for errors at each stage of the vehicle’s assembly.
Similarly, the Dell processes are both highly automated . . . and not. If you go to Dell’s Web site, you can find information to help you select the features you want and order your custom-made computer. That’s great if you’ve owned quite a few computers and want to use a new one for a similar purpose.
It’s even better if you simply need a machine to use at work. Dell will probably have established a customer account profile that will ensure your order is compatible with your firm’s network, hardware, and software.
But what if you’re clueless and need someone to talk to? That’s no problem. You just contact a Dell representative via a toll-free call.
I have ordered equipment from Dell this way. The knowledge and helpfulness of the people I’ve talked to are most impressive. You get the impression that Dell has rounded up thousands of experts with great personalities.
But wait. Are there really so many technophiles who love talking on the telephone? Dell didn’t find that to be the case. Instead, they found people who enjoyed talking on the telephone and who knew something about computers.
Dell made it easy to help by providing automated help screens written in plain-vanilla English that the representatives could use to deliver the latest technical information. Dell also provides classes and additional information to make its representatives more knowledgeable. That’s important because Dell also provides many other kinds of electronic equipment.
Once that order leaves the Web site or the telephone representative, automation takes over again. Supplies by plant are checked against the customer’s location to see where the custom machine should be made.
The assembly is then automatically scheduled for where the inventory is in place and shipping distance is shortest. That scheduling triggers orders for more parts and accessories from the appropriate suppliers. If a needed part isn’t yet at a work station but is in a plant’s inventory, an automatic order goes out to move the part from the inventory to the work station before the computer is due to be assembled.
At the work station, however, things were not so automated when I visited a Dell factory in Texas. It was more like Toyota’s approach to assembly. There was a work order that listed all the parts that were needed. Those parts were pulled by someone from the work station inventory into an assembly kit. The kits were picked up by a two-person team who then assembled the computer, checked it for simple faults, and sent the computer on for automated upgrades.
One of those next steps was to load the software that was ordered with the computer. Automated testing turned up flaws in some computers. The ones with minor errors went to a nearby repair specialist. Those with major errors were not repaired. Instead, another computer was produced in the following few hours.
From there, packing and shipping looked pretty much like any other factory except that the labels were automatically printed for each order to facilitate fast, accurate deliveries. These labels notified the shipper how to combine shipment of the computer with the monitor, printer, and whatever else had been ordered so that although these components shipped from different sites, the customer received a complete order in one combined delivery.
But the automation doesn’t end there. Your new computer’s software will direct you to register with vendors to receive automatic updates. Dell will also send you updates from time to time about subjects that affect the computer you purchased. Your order information will be stored so that the next time you call about ordering a computer, the choices you are presented with reflect your prior purchasing habits.
As you can see, Toyota and Dell are using automation to make the customer and the employee experiences better by creating a flexible process for rapid customization. Whenever automation doesn’t create a better experience, they avoid automation.
Let’s look at a contrasting experience. The first time I ate in an automat in the 1960s, it was a new experience. You went to a wall covered with glass doors. You opened one of those doors to remove the item you wanted, took your tray, and headed for the cash register.
But after one time, the experience paled. It’s more pleasant to go to a coffee shop, diner, or fast-food emporium and order something prepared the way you like it and receive some personal attention. It’s no wonder that automats faded from the landscape. They automated the wrong part of the process and didn’t enhance the customer experience. Avoid that mistake.
Be flexible to help your customers
Donald Mitchell is an author of seven books including Adventures of an Optimist and The 2,000 Percent Squared Solution. Read about creating breakthroughs through 2,000 percent solutions and receive tips by e-mail by registering for free at
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