by E M Goldratt
So I pull over. We get out and walk. By and by, we come to the bench by the river, and the two of us sit down.
"What's your meeting about tomorrow?" she asks.
"It's a plant performance review," I say. "The division will decide the future of the plant."
"Oh. What do you think they'll say?"
"We didn't quite make what I promised Bill Peach," I say. "One set of numbers doesn't look as good as it truly is because of the cost-of-products standards. You remember me telling you about some of that, don't you?"
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She nods, I shake my head momentarily, still angry at what happened as a result of the audit.
"But even with that, we still had a good month. It just doesn't show up as the fantastic month we really had," I tell her.
"You don't think they'd still close the plant, do you?" she asks.
"I don't think so," I say. "A person would have to be an idiot to condemn us just because of an increase in cost of products. Even with screwed-up measurements, we're making money."
She reaches over to take my hand and says, "It was nice of you to take me out to breakfast that morning."
I smile and say, "After listening to me ramble on at five o'clock in the morning, you deserved it."
"When you talked to me then, it made me realize how little I know about what you do," she says. "I wish you had told me more over the years."
I shrug. "I don't know why I haven't, I guess I thought you wouldn't want to hear it. Or I didn't want to burden you with it."
"Well, I should have asked you more questions," she says.
"I'm sure I didn't give you many opportunities by working those long hours."
"When you weren't coming home those days before I left, I really took it personally," she says. "I couldn't believe it didn't have something to do with me. Deep down, I thought you must be using it as an excuse to stay away from me."
"No, absolutely not, Julie. When all those crises were occur- ring, I just kept thinking you must know how important they were," I tell her. "I'm sorry. I should have told you more."
She squeezes my hand.
"I've been thinking about some of the things you said about our marriage when we were sitting here last time," she says. "I have to say you're right. For a long time, we have just been coast- ing along. In fact, we were drifting apart. I've watched you get more and more wrapped up in your job as the years have gone by. And to compensate for losing you, I got wrapped up in things like decorating the house and spending my time with friends. We lost sight of what was important."
I look at her in the sunlight. The awful frosting in her hair which she had when I came home the day the NCX-10 went down is finally gone. It's grown out. Her hair is thick and straight again, and all the same dark brown.
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She says, "Al, the one thing I definitely know now is that I want more of you, not less. That's always been the problem for me."
She turns to me with her blue eyes, and I get a long-lost feeling about her.
"I finally figured out why I haven't wanted to go back to Bearington with you," she says. "And it isn't just the town, al- though I don't like it very much there. It's that since we've been living apart, we've actually spent more time being together. I mean, when we were living in the same house, I felt as though you took me for granted. Now you bring me flowers. You go out of your way to be with me. You take time to do things with me and the kids. Al, it's been nice. I know it can't go on this way forever-I think my parents are getting a little tired of the ar- rangement-but I haven't wanted it to end."
I start to feel very good.
I say, "At least we're sure we don't want to say good-bye."
"Al, I don't know exactly what our goal is, or ought to be, but I think we know there must be some kind of need between us," she says. "I know I want Sharon and Dave to grow up to be good people. And I want us to give each other what we need."
I put my arm around her.
"For starters, that sounds worth shooting for," I tell her. "Look, it's probably easier said than done, but I can certainly try to keep from taking you for granted. I'd like you to come home, but unfortunately, the pressures that caused all the problems are still going to be there. They're just not going to go away. I can't ignore my job."
"I've never asked you to," she says. "Just don't ignore me or the kids. And I'll really try to understand your work."
I smile.
"You remember a long time ago, after we got married and we both had jobs, how we'd come home and just talk to each other for a couple of hours, and sympathize with each other about the trials and tribulations we'd suffered during the day?" I ask. "That was nice."
"But then there were babies," says Julie. "And, later, you started putting in extra hours at work."
"Yeah, we got out of the habit," I tell her. "What do you say we make a point to do that again?"
"That sounds terrific," she says. "Look, Al, I know that leav-
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ing you must have seemed selfish on my part. I just went crazy for a little while. I'm sorry-
"No, you don't have to be sorry," I tell her. "I should have been paying attention."
"But I'll try to make it up to you," she says. Then she smiles briefly and adds, "Since we're walking down memory lane, maybe you remember the first fight we had, how we promised afterwards we'd always try to look at a situation from the other's point of view as well as our own. Well, I think for the past couple of years we haven't been doing that very often. I'm willing to try it again if you are."
"I am too," I say.
There is a long hug.
"So... you want to get married?" I ask her.
She leans back in my arms and says, "I'll try anything twice."
"You know, don't you, it's not going to be perfect," I tell her. "You know we're still going to have fights."
"And I'll probably be selfish about you from time to time," she says.
"What the hell," I tell her, "Let's go to Vegas and find a justice of the peace."
She laughs, "Are you serious?"
"Well, I can't go tonight," I say. "I've got that meeting in the morning. How about tomorrow night?"
"You are serious!"
"All I've been doing since you left is putting my paycheck in the bank. After tomorrow it'll definitely be time to blow some of it."
Julie smiles. "Okay, big spender. Let's do it."
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31
The next morning on the fifteenth floor of the UniCo build- ing, I walk into the conference room at a few minutes before ten o'clock. Sitting at the far end of the long table is Hilton Smyth and sitting next to him is Neil Cravitz. Flanking them are various staff people.
I say, "Good morning."
Hilton looks up at me without a smile and says, "If you close the door, we can begin."
"Wait a minute. Bill Peach isn't here yet," I say. "We're going to wait for him, aren't we?"
"Bill's not coming. He's involved in some negotiations," says Smyth.
"Then I would like this review to be postponed until he's available," I tell him.
Smyth's eyes get steely.
"Bill specifically told me to conduct this and to pass along my recommendation to him," says Smyth. "So if you want to make a case for your plant, I suggest you get started. Otherwise, we'll have to draw our own conclusions from your report. And with that increase in cost of products Neil has told me about, it sounds to me as if you have a little explaining to do. I, for one, would particularly like to know why you are not observing proper pro- cedures for determining economical batch quantities."
I pace in front of them a moment before answering. The fuse to my anger has started a slow burn. I try to put it out and think about what this means. I don't like the situation one bit. Peach damn well ought to be here. And I was expecting to be making my presentation to Frost, not his assistant. But from the sound of it, Hilton may have set himself up with Peach to be my judge, jury, and possibly, executioner.
I decide the safest bet is to talk.
"Fine," I say finally. "But before I go into my presentation of what has been happening at my plant, let me ask you a question. Is it the goal of the UniWare Division to reduce costs?"
"Of course it is," says Hilton impatiently.
"No, actually, that is not the goal," I tell them. "The goal of UniWare is to make money. Agreed?"
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Cravitz sits up in his chair and says, "That's true."
Hilton gives me a tentative nod.
I say, "I'm going to demonstrate to you that regardless of what our costs look like according to standard measurements, my plant has never been in a better position to make money."
And so it begins.
An hour and a half later, I'm midway through an explana- tion of the effects of the bottlenecks upon inventory and throughput when Hilton stops me.
"Okay, you've taken a lot of time to tell us all this, and I personally can't see the significance," says Hilton. "Maybe at your plant you did have a couple of bottlenecks and you discovered what they were. Well, I mean bravo and all that, but when I was a plant manager we dealt with bottlenecks wandering everywhere."
"Hilton, we're dealing with fundamental assumptions that are wrong," I tell him.
"I can't see that you're dealing with anything fundamental," says Hilton. "It's at best simple common sense, and I'm being charitable at that."
"No, it's more than just common sense. Because we're doing things every day that are in direct contradiction to the established rules most people use in manufacturing," I tell him.
"Such as?" asks Cravitz.
"According to the cost-accounting rules that everybody has used in the past, we're supposed to balance capacity with demand first, then try to maintain the flow," I say. "But instead we shouldn't be trying to balance capacity at all; we need excess ca- pacity. The rule we should be following is to balance the/ low with demand, not the capacity.
"Two, the incentives we usually offer are based on the as- sumption that the level of utilization of any worker is determined by his own potential," I tell them. "That's totally false because of dependency. For any resource that is not a bottleneck, the level of activity from which the system is able to profit is not determined by its individual potential but by some other constraint within the system."
Hilton says impatiently, "What's the difference? When some- body is working, we're getting use out of him."
"No, and that's a third assumption that's wrong," I say.
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"We've assumed that utilization and activation are the same. Acti- vating a resource and utilizing a resource are not synonymous."
And the argument goes on.
/ say an hour lost at a bottleneck is an hour out of the entire system. Hilton says an hour lost at a bottleneck is just an hour lost of that resource.
I say an hour saved at a non-bottleneck is worthless. Hilton says an hour saved at a non-bottleneck is an hour saved at that resource.
"All this talk about bottlenecks," says Hilton. "Bottlenecks temporarily limit throughput. Maybe your plant is proof of that. But they have little impact upon inventory."
"It's completely the opposite, Hilton," I say. "Bottlenecks govern both throughput and inventory. And I'll tell you what my plant really has shown: it's proved our performance measure- ments are wrong."
Cravitz drops the pen he's holding and it rolls noisily on the table.
"Then how are we to evaluate the performance of our opera- tions?" asks Cravitz.
"By the bottom line," I tell him. "And based upon that evalu- ation, my plant has now become the best in the UniWare Divi- sion, and possibly the best in its industry. We're making money when none of the others are."
"Temporarily you may be making money. But if you're really running your plant this way, I can't possibly see how your plant can be profitable for very long," says Hilton.
I start to speak, but Hilton raises his voice and talks over me.
"The fact of the matter is that your cost-of-products mea- surement increased," says Hilton. "And when costs go up, profits have to go down. It's that simple. And that's the basis of what I'll be putting into my report to Bill Peach."
Afterwards, I find myself alone in the room. Messrs. Smyth and Cravitz have gone. I'm staring into my open briefcase-then with a fist, I slam it shut.
I'm muttering to myself something about their pigheaded- ness as I exit the conference room and go to the elevators. I press the "down" button. But when the elevator arrives, I'm not there. I'm walking back up the corridor again, and I'm heading for the corner office.
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Bill's secretary, Meg, watches me approach. I stride up to her desk, where she's sorting paper clips.
"I need to see Bill," I tell her.
"Go right in. He's waiting for you," she says.
"Hello, Al," he greets me as I enter his office. "I knew you wouldn't leave without seeing me. Take a seat."
As I approach his desk I start to talk, "Hilton Smyth is going to submit a negative report about my plant, and I feel that as my manager you should hear me out before you come to any conclu- sions."
"Go ahead, tell me all about it. Sit down, we're not in a rush."
I continue to talk. Bill puts his elbows on the desktop and his fingers together in front of his face. When I finally stop he says, "And you explained all of this to Hilton?"
"In great detail."
"And what was his response?" he asks.
"He basically refused to listen. He continues to claim that as long as cost of products increase, profits eventually have to go down."
Bill looks straight into my eyes and asks, "Don't you think he has a point?"
"No, I don't. As long as I keep my operating expenses under control and Johnny Jons is happy, I don't see how profits can help but continue to go up."
"Fine," he says, and buzzes Meg. "Can you call Hilton, Na- than, and Johnny Jons in here please."
"What's going on?" I ask him.
"Don't worry, just wait and see," he says calmly.
It's not long before they all enter the room and take seats.
"Hilton," Bill turns to him, "you heard Alex's report this morning. You've also seen all the financial results. As the produc- tivity manager of the division, and as a fellow plant manager, what's your recommendation?"
"I think that Alex should be called to order," he says in a formal voice. "And I think that immediate actions should be taken in his plant before it's too late. The productivity in Alex's plant is deteriorating, cost of products is going up, and proper procedures are not being followed. I think that immediate actions are in order."
Ethan Frost clears his throat, and when we all look at him
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he says, "And what about the fact that in the last two months that plant has turned profits rather than losses, while releasing a lot of cash for the division?"
"That is only a temporary phenomenon," Hilton states. "We must expect big losses in the very near future."
"Johnny, do you have anything to add?" Bill asks.
"Yes, certainly. Alex's plant is the only one that can produce miracles-to deliver what the client needs in a surprisingly short time. You've all heard about Burnside's visit. With such a plant backing up sales, they can really go out and blast the market."
"Yes, but at what price?" Hilton reacts. "Cutting batches to far below optimum size. Devoting the entire plant to one order. Do you know the long-term ramifications?"
"But I haven't devoted the plant to one order!" I can't con- tain my anger. "As a matter of fact, I haven't got any past-due orders. All my clients are pleased."
"Miracles exist only in fairy tales," Hilton says cynically.
Nobody says a word. At last I cannot hold back, "So what's the verdict-is my plant going to be closed?"
"No," says Bill. "Not at all. Do you think we're such bad managers that we would close a gold mine?"
I sigh in relief. Only now do I notice I've been h
olding my breath.
"As manager of productivity of the division," Hilton says with a red face, "I feel it's my duty to protest."
Bill ignores him, and turning to Ethan and Johnny he asks, "Shall we tell them now, or wait until Monday?"
They both laugh.
"Hilton, this morning I asked you to sit in for me because we were meeting with Granby. Two months from now the three of us are moving up the ladder, to head the group. Granby left it to us to decide who will be the next manager of the division. I think that the three of us have decided. Congratulations, Alex; you will be the one to replace me."
When I return to the plant, Fran hands me a message "It's from Bill Peach. What's going on?"
"Call everybody. I have some good news," I smile.
Bill's message is: "I recommend you use these two months to prepare yourself. You still have a lot to learn, hotshot."
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At last I'm able to reach Jonah in New York and fill him in on the latest developments. Although pleased for me, he does not seem surprised.
"And all this time I just worried about saving my one plant," I tell him. "Now it seems that I'm ending up with three."
"Good luck," says Jonah. "Keep up the good work."
Hurriedly, before he hangs up I ask in a desperate voice, "I'm afraid that luck will not be enough; I'm out of my depth. Can't you come down and help me?" I haven't spent two hours tracking down Jonah just to hear his congratulations. Frankly, I'm terrified at the prospect of my new job. It's one thing to handle a production plant, but handling a division of three plants does not mean just three times the work, it also means responsi- bility for product design and marketing.
"Even if I had the time, I don't think it's a good idea," I hear his disappointing answer.
"Why not? It seemed to work fine so far."
"Alex," he says in a stern voice, "as you climb up the ladder and your responsibilities grow, you should learn to rely more and more on yourself. Asking me to come now will lead to the oppo- site; it will increase the dependency."