(Setting: The owners of a small automotive supplier asked me to do a post-mortem assessment of a product launch that went awry. After studying the situation, I presented my findings in the form of the parody that follows. All names are fictitious, but the case study is not.)
Once upon a time, there was a brave little company called Ambitious Automotive (AA) that wanted to take on a challenging project in order to grow the company. This strategy was ratified after the following business case analysis:
CEO: “Will this new business shore up the dwindling revenue in our Southern Business Unit?
President: “Yep!”
So, the company embarked on their venture to supply critical parts to Deutschland Company’s (DC) factory in Alabama. The team that would be assigned to support the new venture was staffed in the usual manner.
Program Manager: “Where’s the rest of my team?”
President: “They’re assigned to other programs, and we have no budget.”
Program Manager: “But we only have six months to launch this product! It’s suicidal!”
President: “Hey, the customer is giving us a $10,000 premium to speed up the process.”
Program Manager: (Prophetically). “We’ll burn that in one hour!”
Several months later, a replacement Program Manager was oriented.
Replacement Program Manager: “What happened to the first program manager?”
President: “He drove into the side of a mountain.”
Replacement Program Manager: “Why?”
President: “You’ve used up your one question.”
The DC Purchasing Manager was more helpful. “You will conform,” was how Thomas Achtung oriented the Replacement Program Manager to DC’s Germanic way of doing business.
Things were going well, until it was discovered that AA didn’t speak the same CAD language as DC, didn’t have the technology required to produce the product, and had run out of money.
Fortunately, DC made the design more complicated, made the quality requirements more extreme, quintupled the production volume, and demanded a cut in the purchase price.
Unfortunately, AA missed all of these opportunities to renegotiate the program cost and timing. The first and only attempt at negotiation went like this:
Program Manager: “Hey, you can’t do that to us!”
Thomas Achtung: “You will conform.”
The selection of suppliers for the new program was done very efficiently by AA. The selection process went like this:
Program Manager, addressing himself: “How about these guys? They took me to lunch and bought me tickets to the big game.”
Program Manager, replying to self: “Okay. They look like nice folks. I’ll give each of them a big purchase order.”
Things were going well with these suppliers, until the molder went bankrupt, the tool maker fell hopelessly behind schedule, the painter patented a process for mixing dirt in with the paint, and the final assembler….well, there was no final assembler.
Fortunately, replacement suppliers were successfully recruited after AA led them to believe that the product was nearly ready for a seamless launch.
Unfortunately, AA lied. Subsequent discussions with suppliers were strained:
Supplier: “Where are my limit samples defining the quality requirements?”
AA: “We have a limited supply.”
Supplier: “How limited?”
AA: “We have none.”
Supplier: “Where are the drawings for this product?”
AA: “On the drawing board.”
Supplier: “When will they be ready?”
AA: “Shortly after we learn the CAD language.”
Supplier: “Is the product design stable?”
AA: “It is, until our next meeting with the customer.”
Supplier: “What shape is the tooling in?”
AA: “It will get the part to within 6 mm of specification.”
Supplier: “What’s the tolerance on the specification?”
AA: “+/- 3 mm. But, we think we can trick the parts into shrinking.”
Supplier: “What will I pack the parts into?”
AA: “Returnable containers.”
Supplier: “When will they be available?”
AA: “Four months after launch.”
Supplier: “What’s the forecast for annual volume?”
AA: “Either 5,000 or 25,000 per year, unless we fail. Then it will be zero.”
Supplier: “What should I plan on?”
AA: “Late payments from our controller.”
Supplier: “Then I guess I’ll ship anything I damn well please, whenever I please.”
In the meantime, AA assembled a topnotch cross-functional team to kick the program into high gear. They called this team a “troika”. Here’s how the introduction of the troika team leaders went:
Operations Manager: “I’m new here. My friends call me ‘Rottweiler’.”
Account Manager: “I hate you.”
Program Manager: “Hey, you stole my line.”
The troika team had daily marathon teleconferences, during which everyone spoke, no one agreed, and nothing was written down. Management subsequently assessed the effectiveness of this arrangement:
Management: “Who’s leading this process?”
Troika: “We have no leader. We’re a troika!”
Management: “How do you make decisions?”
Troika: “We each make our own decisions and try to hide them from the other two.”
Management: “Where’s your Task List?”
Troika: (Hastily writing something down). “Here!”
Management: “The only entry is ‘I hate my troika mates’! Where’s your program plan?”
Troika: “We don’t do those unless things go to hell and the customer insists on a recovery plan.”
Management: “Aren’t you guys using any piece of our APQP process?”
Troika: (Reaching for a notepad). “Can you spell ‘APQP’, please?”
Management: “My God! Where are your DFMEA, your FMEA, and your control plan?”
Troika: (Writing furiously). “Slow down! We can’t take notes that fast…”
Despite these challenges, AA and its suppliers managed to build some pre-production units for DC’s quality engineer, Yo Adrian, to inspect. Yo’s assessment of the pre-production units went like this:
Yo: “These parts are 6 mm too big. I’ve told you that before. Are you deaf?”
AA: “What?”
Yo: “Why is this part glued on?”
AA: “The clips don’t work.”
Yo: “Why is this part taped on?”
AA: “It doesn’t fit into the groove of the other part.”
Yo: “Why is this rough edge on the surface?”
AA: “Because you insisted that it not be there.”
Yo: “Did someone pour sand into the paint while it was wet?”
AA: “Will that sound better than admitting our painter is incapable?”
Yo: “Where did you assemble these?”
AA: “In a parking lot. Our assembly shop isn’t read yet.”
Yo: “What exactly is the capability of your supply chain?”
AA: “With or without paint?”
This last question got to the crux of the production issues. DC had specified the use of Warthog paint, which made every capable painter in North America slam their doors whenever AA buyers came to beg for service. Fortunately, AA had started a joint venture with a painting company named Tiara that had just recently set up a new painting shop, just for AA. Unfortunately, Tiara neglected to design the paint facility with the capability to paint Warthog paint. So, as a last resort, AA’s fate was left in the hands of Engarde, a painting company that was run by a former restaurant owner and a pig named Arnold.
Engarde was willing to do anything to help AA with this critical DC product, except improve their painting process or take accountability for anything. Consequently, when the fist run of 300 sets was painted and sent to DC’s facility in Alabama for inspection, the assessment went like this:
DC: “Congratulations! These are the most consistent parts we’ve ever seen!”
AA: (High fives).
DC: “Not so fast. They’re all rejected! Every single one of them!”
AA: “What for?”
DC: “All the reasons we rejected your pre-production parts for. Are you guys deaf?”
AA: “What?”
DC: “Where’s your Quality Manager?”
AA: “He was up all night polishing these parts and driving them from Ohio to Alabama.”
DC: “Then who’s monitoring and improving your quality system?”
AA: (Quizzical expressions).
Since AA was unable to produce good parts, the DC vehicle assembly line in Alabama shut down. This was actually good news, because it was costing AA more to make the parts than they could sell them for. This unprofitable situation frustrated AA’s CFO, who had several versions of the following conversation over the past few months:
CFO: “How much will this product cost us to make?”
Program Manager: “I don’t know. I’m not keeping track.”
Unfortunately, DC wanted parts, whether it was profitable for AA to make them or not. This was emphasized during the following conversation:
AA Account Manager: “Can we ship shoddy parts to you late and get a price increase too?”
Thomas Achtung: “You will conform.”
AA finally caught a break when Engarde announced that they were no longer willing to paint parts for AA, which was ironic, because Engarde had never actually produced any usable parts yet. So, AA made the tour of potential Warthog painters to replace Engarde. The tour was very short. There was only one willing painter, ThinCore (TC), which was run by the great grandson of Ebenezer Scrooge. To make matters worse, ThinCore had never painted Warthog paint before, so it would eventually cost AA $1.5 million in development costs, which exceeded the $10,000 that had been paid by DC for premium costs to speed up the project. Since AA had no other options, the contract negotiations with TC went like this:
TC: “I brought some Vaseline for you.”
AA: “We were hoping for a normal business relationship. How about if we pay you a piece price for good parts that you paint, 30 days after you ship them?”
TC: “How about if you pay me $3,000 per hour for my painting services whether I make any good parts or not, and how about if you pay me at three minutes past each hour?”
AA: (Scoffing). “That doesn’t work for us.”
TC: “Okay then, how about if you buy the paint for me, teach me how to apply Warthog paint, give me a lifetime contract, and then assume the position?”
AA: “What choice do we have?”
TC: “Top or bottom.”
So, AA and TC signed a contract. Battalions of AA personnel showed up in their normal work attire to help launch the product at TC. Seeing the AA hordes clad in yellow oilskins, ThinCore started the following conversation.
TC: “Why are you all wearing those firefighting outfits?”
AA: “Firefighting is the core competency of our company.”
TC: (Winking suspiciously). “Hmmmm…..that may come in handy someday.”
Subsequently, after performing miserably for several months, a mysterious fire broke out at ThinCore. The fire destroyed their paint line and opened up a magnificent spigot of business interruption insurance payments for the owner. This was the final straw for DC, who wisely replaced AA with another supplier.
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