An Evolving Excellence reader from Denmark by the name of Peter Risager, a manufacturing systems student at Aalborg University in Denmark, sent me a translation of an article on the most recent nonsense from the McKinsey wizard running Lego into the ground. You may recall that he moved just about everything from Billund, the the Danish town that has been home to Lego forever to foreign factories, then shut down those factories and sent all the work to a third party manufacturer in eastern Europe and Mexico. Now he is trying to figure out how to get the third party folks to perform, explaining that " It is like teaching a five-year old to ride a bicycle with training wheels. It has been necessary, to a higher degree than expected, to run behind him with with a stick tied to the bike to ensure that the child does not crash."
I have taught just about all of my kids to ride bicycles and never saw the need to run behind them with a stick, so I am not sure just how Mr. Knudstorp is helping. For that matter, having demonstrated that he cannot effectively manage manufacturing in Denmark or anywhere else, it is hard to see how Mr. Knudstorp is qualified to teach his contract suppliers anything at all. The salvation for Lego will come when the city fathers and company owners are seen running behind Knudstorp with sticks, chasing him beyond the Billund city limits, never to return.
I have trashed Lego and Knudstorp enough in Evolving Excellence. The point that another great old manufacturer is being destroyed has been made. The bigger point I want to make is that it is all about management. Of course manufacturing can succeed in Billund – and if it is failing, it because of how it is being managed. The Knudstorps of the world don’t understand that basic point. By moving the plant from Billund to the Czech Republic and the U.S, he did nothing to address how the plants are being run – just where they are being run, which was not the problem. Then turning them over to contract operators and moving from the U.S, to Mexico, he changed who was running them, but again missed the fundamental problem of how.
Investing hundreds of millions of scarce Lego dollars in an ERP system did not fix the how problem either. It simply automated the current, unsuccessful approach. In effect, it is driven by the belief that everything that is practiced by management is inherently right – it just needs to be done faster and more accurately. Of course, if current management practices are actually the source of the problem, a big ol’ computer system to automate those practices just accelerates the rate of the unfolding disaster.
I haven’t blogged for a while – I apologize and I sorely miss the regular interaction with all of you – due to a combination of laziness and a hectic travel load. I am just coming off a a month long binge during which I went 8,500 miles and talked to a little over 500 people in 8 states about lean manufacturing management. There were far too many manufacturing operations people in my audience – to whom most of what I have to say was like preaching to the choir – and far too few CEO’s, CFO’s and HR directors, but there were enough of them to be encouraged.
A guy named Gerry Edwards who has taken on the challenge of saving Scottish manufacturing from extinction puts it well: "The big question at the end of the day is: how good is the management? That is what makes the difference."
He is right, lean manufacturing or manufacturing excellence by any name, boils down to that question – how good is your management?