Found 500,000 Euros… Now What?
It’s a beautiful noon, the rain has stopped, and there’s even a bit of sunshine. It’s Friday, and Jubal seems unsure whether to laugh or worry. He shares an Excel screenshot, summary tables of piece numbers per shift, current times, target times, different machine usage. “I started on this last night, I couldn’t resist. These are simplified tables, the numbers are extracted from five other sheets… no, I haven’t done all the homework yet, the video of the first span’s processing phase is missing, I haven’t collected the numbers on-site yet, not yet, I got these from the CNC… yes, I’ll make the video, but now, guys, this is… well, doing it this way cuts the times and doubles the output… that means half a million euros a year, in net margin, without spending a cent more. I’ll build the new equipment with the savings from not using the current one, which will be used elsewhere…”
Well, folks, it’s the first time after a dozen microcycles that a kohai has “discovered” such a substantial windfall so early. At first, I’m not even sure I understand it correctly… but why doesn’t he know whether to laugh or worry?
My brain needs time to piece it together, and I certainly didn’t expect this from the previous microcycle… the agreements were “well-verified reality (gemba, video) versus the standard cost of ONE standard cost…”
Probably, if I were in Jubal’s shoes, I would have done the same, senpai or not, I want an approximate idea of where I’ll end up… yes, I think I wouldn’t have resisted either, even though I know perfectly well, from repeated experience, that Excel tells you what you want to hear if you interrogate it long enough and with determination… and in Jubal’s place, I would really want to hear “yes, bravo, eureka! You did it!”
Jubal seems simultaneously happy and worried… Stefano proceeds cautiously, not moving (and I understand why, if the source is Excel, the risk is that we’re listening to the Oracle of Delphi, “ibis redibis non perieris in bello,” a matter of commas, just like Excel) from keeping his attention focused on the data source… how did we verify the existence of the gap between standard costs and actual costs? By thinking about it or by going to see, at the gemba?
Stefano has seen much more than I have, he gets alarmed (and that’s exactly what should be done) when we lose real, direct, physical contact with the gemba… as systemic thinkers, we know that virtual environments (what’s in our mind) must be kept as close as possible, physically, to real environments, thinking-doing and doing-thinking, to avoid getting lost in the infinite combinatory possibilities our wonderful minds can generate… of these, few, very few, are good, and only the gemba helps us not to get lost.
And no, it’s not enough to be physically at the gemba, we’ve all been there, we’re perfectly capable of being present, physically, in a place, and simultaneously not being there at all, of following, as it’s commonly said, the thread of our thoughts… the video is ruthless, it doesn’t follow us, start, record, and it sees only what can be seen while we can go, virtually, anywhere.
A kind of safety device, in short…
But what the hell is worrying our Jubal? He should be as happy as a clam, but he doesn’t look it, what’s buzzing in his head?
We only have fifteen minutes, it took us a while, but we’ve become quite good, we rarely overrun, and if we do, it’s not by much. We converge on the next step, in view of the next microcycle, good for the encouraging projections, we’ll see. The step remains: well-verified reality (gemba, video) versus the standard cost of ONE standard cost…
Jubal seems curiously reassured, we’ll see what has been bothering him and find a good solution. For now, let’s take this step. Bye, have a good weekend, see you Monday…
He gave us a reason a while ago; this is one of the production lines dedicated to a flagship product… it’s not doing badly, and, simply put, you don’t change a winning team, right?
It seems that Jubal thinks it won’t be that easy to “convince” the big boss to approve the improvement plan, even though half a million euros in net margin should really excite him, it’s a great result… yes, okay, we need to do our homework well, prepare data and evidence, actual costs vs standard costs, new production cycle setup, savings, new marginality…
Jubal informed his boss at the time that he was working on an improvement idea with our support, but his boss hasn’t been involved in all the steps we’ve taken, he gladly gave his approval. How can we make him understand what Jubal can achieve? We’ll have to address it…
It’s also possible that we ourselves, microkaizen, become part of the problem, not the solution: in that company, they’ve done everything, six-sigma, WCM, Lean, and now here we come with a completely different method, just what they needed… it’s certainly possible that we encounter “resistance” from the other factions, how will we handle it?
It’s not a matter of envy, commonly put (let’s set aside systemic thinking for a moment), it’s that it’s not easy to accept that things were done in a way that didn’t generate that margin, there’s a risk that someone fears losing face, losing credibility… take my bag, before it wasn’t mine, now it is, later it won’t be mine anymore, but don’t take away my name, my honor: this doesn’t make you rich, and it makes me very poor.
It shouldn’t be this way, of course, systemic improvement needs a no-blame context, where nothing that has been done (or not done, that’s also doing) is used to discredit. The constant focus on the gemba, on continuous improvement, is safe within the framework of recognizing that everyone can only do their best, can only do their best: and we all start from this to improve and keep improving.
And then, for us, there’s the bigger risk, the risk that this work is mistaken for what it is not and should not be: we do not do cost cutting, cost reducing, cost saving, process optimization, it’s not enough, those are just shadows, side effects.
With all due respect, it’s junk, shiny fool’s gold that seduces and distracts from the focus that must be kept constant on the search, on the gemba, for value and non-value, basing every improvement initiative solely on that, and on building, every day, senpai-kohai relationships among those who work together.
Jubal has also taken the first steps in this regard, sharing some parts of the work he’s doing with us with his collaborators, he hasn’t told us much about how and what he did, but the little he told us, he told us while laughing contentedly…
The half-million-euro windfall risks overshadowing what has greater value not just for Jubal and his boss, but for the whole company: yes, it’s the method, this is what needs to be protected, spread, and supported, this is what has the greatest value, this is what allows the organizational machine, the organizational system, to improve, every day, productivity and marginality.
Not that Jubal has influenced us, but we too are simultaneously happy—good grief, it’s quite a windfall—and worried about how it will end… maybe it would have been better not to find 500,000 euros…

