It is great to be back blogging at Evolving Excellence after a long hiatus. For those who have been around long enough to remember me, I am looking forward to catching up on what I have missed over the last few years, and I have plenty of new yarns to spin for you. For the relative newcomers who don't remember me, I somehow developed a reputation for being something of a lean curmudgeon, prone to go off on an occasional rant … a reputation grossly undeserved, by the way, since none of the threatened lawsuits ever actually went to court so how bad could things have been?
My absence was brought about by having taken gainful employment with the Wahl Clipper Corpin Sterling, Illinois. In order to be sure no one thought my ranting expressed the official viewpoint of Greg Wahl or anyone else at the company, I was asked to refrain while I worked as VP of Global Operations. No one who knows Greg, or the other Wahl family members, would make the mistake of thinking that my blathering could be their doing. The Wahls are gentlemen, every one of them, and not the blustering sort.
Before I take on the the rest of manufacturing, I thought it appropriate to share a few of the extraordinary lean lessons I learned from my time at Wahl. First and foremost, however, you should know that Wahl is like most of the true lean companies – they fly well below the radar. This is a luxury that family owned businesses enjoy. They are self-sufficient and don't have to worry about what Wall Street or anyone else knows or thinks about them.
Second, they are rampaging through the US consumer market for hair clippers with results that makes Sherman and Attila the Hun look like sissies. They are doing that with products made, for the most part, at their Sterling plant. Wahl has pretty much taken over the shelves at places like Walmart, Target and Walgreens; the competitors they are driving out are 100% Wall Street owned and 100% Chinese manufactured; and those competitors are 100% lower cost and lower priced.
You might want to reread the previous paragraph since it stands just about everything they teach at the Ivy League MBA programs on its ear. So much for American labor costs, price being everything which means cost is everything, price volume assumptions, and the rest of the multi-syllabic hot air we hear to rationalize poor manufacturing management these days.
So how does Wahl perform these amazing feats of derring do? Through a total commitment to lean, of course. To the external eye, they run kanbans everywhere, execute 5S, kaizen events, and continually rearrange the factory furniture to put more product into 1 piece, continuous flow.
Peel back the onion a layer or two, and you will find that there is more to it than that. Most of the organization is structured in value streams, rather than the old functional silos, and Wahl has wholeheartedly embraced Lean Accounting. It has become routine at the annual Lean Accounting Summitto see not only Greg Wahl – CEO and Chairman – but the operating and sales and marketing management team, as well. Last year, the accounting team from the Wahl plants in China, Germany and Hungary were there, as well.
But the onion has to peeled back yet another layer to get to the heart of why Wahl succeeds when the overwhelming majority fail. There is a core management philosophy – a culture, perhaps – that embraces things like …
All decision need to be made with equal parts: the head, the heart and the gut. The head means that, of course, decisions must be fact based and have to make a degree of financial sense. The heart means that the decision must consider people and common decency. Money does not outweigh doing the right thing. I should mention that the Wahl family is very involved in the Catholic Church and has pretty much created the local Catholic school system in Sterling. I am not saying that you need to be Catholic to be lean, but I am thoroughly convinced that you have to recognize the existence of something bigger than yourself. And finally, the gut, which means that decisions have to pass the common sense test.
Wahl management does a lot of what they call 'farmer checks' – common sense evaluations using simple logic and rounded off numbers. You hear people using the phrase "it is what it is" quite often at Wahl – deal with facts, rather than what you might want a thing to be, and don't spend much time pointing fingers or worrying about how it got that way.
A service center that cannot possibly justify itself financially but keeps Wahl talking face to face with real live customers. No layoffs in over 30 years. A million stories demonstrating the personal commitment and friendship the Wahl family enjoys with every employee.
The common thread through all of this is that Wahl Clipper demonstrates the great quote from Henry Ford that I have very often cited – "Profit is the inevitable conclusion of work well done".
The Wahl management team spends all of their time and energy worrying about the quality and value of the product, about the satisfaction of customers, and the long term health and welfare of employees, and they let the money take care of itself.
And take care of itself it has, very, very nicely. And they took very good care of me, too. I owe a debt of gratitude to Greg and the rest of the Wahl team. It's great to be back on the lean consultingtrail, but I will miss working with the wonderful folks at Wahl every day.
Ron Pereira says
What an excellent post! I suppose I am one of the newer folks you describe as you were not writing when I started reading EE. But I really look forward to learning from your insights. Welcome back!
Michael Martin says
Welcome back, Bill. I may have started reading after you were a regular, but I really enjoyed your book with Bodek *The Rebirth of American Industry*.
I wanted to call your attention to some new academic research, which I believe may ultimately be a boon to the lean movement. Several physicists have independently come to the conclusion that neoclassical economic theory (which ultimately underlies the Sloan model and cost accounting) is gauge invariant. There are many implications to this, but perhaps one of the most important is that managers of a firm cannot expect to optimize performance looking only at time-averaged costs.
It is a bit early to wade into what is still largely an academic debate, but I wanted to call this to your attention. It could be useful to you in promoting lean principles.
See here:
http://www.marginalrevolution.com/marginalrevolution/2009/03/lee-smolin-on-general-equilibrium-theory.html#comments
William Pietri says
Very interesting! This pleases me, as I have a set of Wahl clippers that I bought a few years ago and are like something out of another era: a well-made, long-lasting, satisfying, and reasonably priced consumer product.
This year’s Agile Software Development conference, which has a lot of Lean influence, is being held in Chicago in August. Do you think the Wahl people would be receptive to a field trip? I’d love to see that culture and that process in action.
Andy Wagner says
Bill,
It’s great to have you back!
In the past few years I’ve learned that everything you ever ranted about lean accounting was absolutely true and more so. Looking forward to reading you again,
Andy Wagner
Dave says
It is wonderful to have you back! I cannot wait to read your future rants!
Kathleen says
Hey Bill! I’ve missed my old sparring partner! Great to have you back and ease Kevin’s burden a bit.
Bill Waddell says
Thanks to all of you for the kind words and emails. I’m glad to be back.
Costikyan Jarvis says
It is great to have you back Bill. Of course I am biased, but it is good to see that you had a great experience with a family business (I would not expect anything else!).
Mike Gardner says
Yes, very glad to have you back, Bill.
Car Parts says
I agree with you. I wanted to call your attention to some new academic research, which I believe may ultimately be a boon to the lean movement. Several physicists have independently come to the conclusion that neoclassical economic theory (which ultimately underlies the Sloan model and cost accounting) is gauge invariant. There are many implications to this, but perhaps one of the most important is that managers of a firm cannot expect to optimize performance looking only at time-averaged costs.
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