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"Well, I don't know. I'd like that business back again, too,
but. . . ."
"The real kick in the head is if we had only had the foresight
to build a finished goods inventory of Model 12's while we had
those slow sales months, we could have made this sale," he says.
I have to smile to myself, because at the beginning of the
year I might have agreed with that.
"It's too bad," Johnny is saying. "Aside from the initial business, it could have been a big opportunity for us."
"How big?"
"Strong hints have been dropped that if we can come
through on this one, we could become their preferred supplier,"
says Jons.
I'm quiet for a moment.
"All right. You really want this, don't you?" I ask him.
"So bad I can taste it," he says. "But if it's impossible. . . ."
"When do you have to let them know?" I ask.
"Probably sometime today, or tomorrow at the latest," he
says. "Why? Do you think we can really do it?"
"Maybe there's a way. Let me see how we stand and I'll give
you a call back," I tell him.
As soon as I get off the phone with Jons, I round up Bob,
Stacey, and Ralph for a meeting in my office, and when we're all
together I tell him what Jons told me.
"Ordinarily, I would think this is out of the question," I say.
"But before we say no, let's think about it."
Everybody looks at me with the certain knowledge this is
going to be a waste of time.
I say, "Let's just see what we can do, okay?"
For the rest of the morning, we're busy with this. We go over
the bill of material. Stacey checks on raw materials inventories.
Ralph does a quick estimate of how long it will take to produce a
thousand units after the materials are on hand. By eleven o'clock,
he has calculated that the bottlenecks can turn out parts for the
Model 12 at the rate of about one-hundred per day.
"So, yes, it would be technically feasible for us to take the
order," says Ralph. "But that's only if we work on nothing else
for two weeks except the thousand units for Burnside."
"No, I don't want to do that," I tell him, thinking about us
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screwing up relations with a dozen customers just to please one.
"Let's try something else."
"Like what?" asks Bob, who is sitting there with us, looking
about as enthusiastic as a bump on a log.
I say, "A few weeks ago, we cut our batch sizes by half, and
the result was we could condense the time inventory spends in
the plant, which also gave us an increase in throughput. What if
we cut the batch sizes by half again?"
Ralph says, "Gee, I hadn't thought of that."
Bob leans forward. "Cut them again? Sorry, Al, but I don't
see how the heck that can help us, not with the volume we're
already committed to."
"You know," says Ralph, "we have quite a few orders we'd
planned to ship ahead of their due dates. We could re-schedule
some of those in the priority system so they'd ship when prom-
ised instead of early. That could give us more time available on
the bottlenecks, and it wouldn't hurt anybody."
"Good point, Ralph," I tell him.
"But, hell, we still can't get a thousand units done no-how,"
drawls Bob. "Not in two weeks."
I say, "Well, then, if we cut the batch sizes, how many units
can we do in two weeks and still ship our current orders on time."
Bob pulls on his chin and says, "I guess we could look into
it."
"I'll see what I can find out," says Ralph, standing so he can
leave and go back to his computer.
His interest finally piqued, Bob says, "Maybe I'd better go
with you so we can noodle this thing out together."
While Ralph and Bob are wrestling with this new possibility,
Stacey enters with news about inventories. She's ascertained we
can obtain all the materials we need either from our own stocks
or from vendors within a few days, with one exception.
"The electronic control modules for the Model 12 are a
problem," says Stacey. "We don't have enough of this type in
stock. And we don't have the technology to build them in-house.
But we've located a vendor in California who has them. Unfortu-
nately, the vendor can't promise a shipment of that quantity in
less than four to six weeks, including shipping. I'd say we might
as well forget it."
"Wait a minute, Stacey; we're thinking about a little change
in strategy. How many modules could they give us per week?" I
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ask her. "And how soon could they ship the first week's quantity
to us?"
"I don't know, but doing it that way, we might not be able to
get a volume discount," says Stacey.
"Why not?" I ask. "We'd be committing to the same thou-
sand units—it's just that we'd be staggering the shipments."
"Well, then there's the added shipping cost," she says.
"Stacey, we're talking a million dollars in business here," I
tell her.
"Okay, but they'll take at least three days to a week to get
here by truck," she says.
"So why can't we have them shipped air freight?" I ask.
"They're not very big parts."
"Well. . . ." says Stacey.
"Look into it, but I doubt if the air freight bill is going to eat
up the profit on a million-dollar sale," I tell her. "And if we can't get these parts, we can't get the sale."
"All right. I'll see what they can do," she says.
At the end of the day, the details are still being sweated out,
but we know enough for me to place a call to Jons.
"I've got a deal on those Model 12's for you to relay to Burn-
side," I say.
"Really?" says Jons excitedly. "You want to take the busi-
ness?"
"Under certain conditions," I tell him. "First of all, there is no way we can deliver the full thousand units in two weeks. But
we can ship 250 per week to them for four weeks."
"Well, okay, they might go for that," says Jons, "but when
can you start shipping?"
"Two weeks from the day they give us the order," I say.
"Are you sure about this?" asks Johnny.
"The units will ship when we say they will," I tell him.
"You're that confident?"
"Yes."
"Okay, okay. I'll call them and see if they're interested. But,
Al, I just hope what you're telling me is real, because I don't want
to go through all the hassles we had before with these people."
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A couple of hours later, my phone rings at home.
"Al? We got it! We got the order!" shouts Jons into my right
ear.
And in my left ear, I hear a million bucks rung up on the
cash register.
"You know what?" Jons
is saying. "They even like the smaller shipments better than getting all thousand units at once!"
I tell him, "Okay, great, I'll get the ball rolling right away.
You can tell them that two weeks from today, we'll ship the first
250."
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30
At the beginning of the new month, we have a staff meeting.
Everyone is present except Lou. Bob tells me he'll be in shortly. I
sit down and fidget. To get the meeting rolling while we're wait-
ing for Lou, I ask about shipments.
"How is Burnside's order coming along?" I ask.
"The first shipment went out as scheduled," says Donovan.
"How about the rest of it?" I ask.
"No problems to speak of," says Stacey. "The control boxes
were a day late, but there was time enough for us to assemble
without delaying the shipment. We got this week's batch from the
vendor on time."
I say, "Good. What's the latest on the smaller batches?"
"The flow through the shop is even better now," says Bob.
"Excellent," I say.
Just then Lou comes into the meeting. He's late because he
was finishing the figures for this month. He sits down and looks
straight at me.
"Well?" I ask. "Did we get our fifteen percent?"
"No," he says, "we got seventeen percent, thanks in part to Burnside. And the coming month looks just fine."
Then he goes into a wrap-up of how we performed through
the second quarter. We're now solidly in the black. Inventories
are about forty percent of what they were three months ago.
Throughput has doubled.
"Well, we've come a long way, haven't we?" I ask.
Sitting on my desk when I get back from lunch the next day
are two crisp, white envelopes with the UniWare Division logo in
the upper left corner. I open one and unfold the stiff stationery.
The body of the letter is only two short paragraphs, with Bill
Peach's signature on the bottom. It's congratulating us on the
Burnside business. Tearing open the other, I find it too is from
Peach. It too is short and to the point. It formally directs me to
prepare for a performance review of the plant, which is to be held
at headquarters.
The smile I had from reading the first letter broadens. Three
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months ago, that second letter would have dunked me into
dread, because although it doesn't say so directly, I presume the
review will be the occasion for determining the future of the
plant. I was expecting some kind of formal evaluation. And now I
am no longer dreading it—on the contrary, I welcome it. What
do we have to worry about? Hell, this is an opportunity to show
what we've done!
Throughput is going up as marketing spreads the word
about us to other customers. Inventories are a fraction of what
they were and still falling. With more business and more parts
over which to spread the costs, operating expense is down. We're
making money.
The following week, I'm away from the plant for two days
with my personnel manager, Scott Dolin. We're at an off-site, very
confidential meeting in St. Louis with the division's labor rela-
tions group and the other plant managers. Most of the discussion
is about winning wage concessions from the various unions. It's a
frustrating session for me—at Bearington, we don't particularly
need to lower wages. So I'm less than enthusiastic about much of
the strategy suggested, knowing it could lead to problems with
the union, which could lead to a strike, which could kill the prog-
ress we've been making with customers. Aside from all that, the
meeting is poorly run and ends with very little decided. I return
to Bearington.
About four in the afternoon, I walk through the doors of the
office building. The receptionist flags me down as I pass. She tells
me Bob Donovan has asked to see me the moment I arrive. I
have Bob paged and he comes hurrying into my office a few
minutes later.
"What's up, Bob?" I ask.
"Hilton Symth," he says. "He was here in the plant today."
"He was here?" I ask. "Why?"
Bob shakes his head and says, "Remember the videotape
about robots that was in the works a couple of months ago?"
"That was killed," I say.
"Well, it was reincarnated," says Bob. "Only now it's Hilton, because he's productivity manager for the division, doing the
speech instead of Granby. I was having a cup of coffee out of the
machine over by C-aisle this morning when I see this T.V. crew
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come trooping along. By the time I found out what they were
doing here, Hilton Smyth is standing at my elbow."
"Didn't anybody here know they were coming?" I ask.
He tells me Barbara Penn, our employee communicator,
knew about it.
"And she didn't think to tell anybody?" I say.
"See, the whole thing was re-scheduled on short notice," says
Bob. "Since you and Scott weren't around, she went ahead on
her own, cleared it with the union, and made all the arrange-
ments. She sent around a memo, but nobody got a copy until this
morning."
"Nothing like initiative," I mutter.
He goes on to tell me about how Hilton's crew proceeded to
set up in front of one of the robots—not the welding types, but
another kind of robot which stacks materials. It soon became ob-
vious there was a problem, however: the robot didn't have any-
thing to do. There was no inventory for it, and no work on its
way.
In a videotape about productivity, the robot, of course, could
not simply sit there in the background and do nothing. It had to
be producing. So for an hour, Donovan and a couple of assistants searched every corner of the plant for something the robot could
manipulate. Meanwhile, Smyth became bored with the wait, so he
started wandering around, and it wasn't long before he noticed a
few things.
"When we got back with the materials, Hilton started asking
all kinds of things about our batch sizes," says Bob. "I didn't
know what to tell him, because I wasn't sure what you've said up
at headquarters and, uh . . . well, I just thought you ought to
know."
I feel my stomach twisting. Just then the phone rings. I pick
it up at my desk. It's Ethan Frost at headquarters. He tells me
he's just had a talk with Hilton Smyth. I excuse myself to Bob,
and he leaves. When he's gone and the door is shut, I talk to
Frost for a couple of minutes and afterwards go down to see Lou.
I walk though the door and start to tap dance.
Two days later, an audit team from headquarters arrives at
the plant. The team is headed by the division's assistant control-
ler, Neil Cravitz, a fiftyish man who has the most bone-crushing
> handshake and the most humorless stare of anyone I've ever met.
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They march in and take over the conference room. In hardly any
time at all, they've found we changed the base for determining
the cost of products.
"This is highly irregular," says Cravitz, peering at us over the tops of his glasses as he looks up from the spreadsheets.
Lou stammers that, okay, maybe it wasn't exactly according
to policy, but we had valid reasons for basing costs on a current
two-month period.
I added, "It's actually a more truthful representation this
way,"
"Sorry, Mr. Rogo," says Cravitz. "We have to observe stan-
dard policy."
"But the plant is different now!"
Around the table, all five accountants are frowning at Lou
and me. I finally shake my head. There is no sense attempting to
appeal to them. All they know are their accounting standards.
The audit team recalculates the numbers, and it now looks as
if our costs have gone up. When they leave, I try to head them off
by calling Peach before they can return, but Peach is unexpect-
edly out of town. I try Frost, but he's gone too. One of the secre-
taries offers to put me through to Smyth, who seems to be the
only manager in the offices, but I ungracefully decline.
For a week, I wait for the blast from headquarters. But it
never comes. Lou gets a rebuke from Frost in the form of a memo
warning him to stick to approved policy, and a formal order to
redo our quarterly report according to the old cost standards and
to submit it before the review. From Peach, there is nothing.
I'm in the middle of a meeting with Lou over our revised
monthly report early one afternoon. I'm crestfallen. With the
numbers based on the old cost factor, we're not going to make
our fifteen percent. We're only going to record a 12.8 percent
increase on the bottom line, not the seventeen percent Lou origi-
nally calculated.
"Lou, can't we massage this a little more?" I'm pleading.
He shakes his head. "From now on, Frost is going to be scru-
tinizing everything we submit. I can't do any better than what
you see now."
Just then I become aware of this sound outside the offices
that's getting louder and louder.
Wuppa-wuppa-wuppa-wuppa-wuppa-wuppa-wuppa-wuppa.
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