Process – Page 2 – understand-culture

Henry Ford’s Assembly Line

One of the few Americans to focus on processes was Henry Ford. Born in Michigan in 1863 Ford began an apprenticeship as a machinist at the age of 16, and in 1891 he was hired as an engineer for the Edison Illuminating Company. Five years later, he constructed his first model of a horseless carriage, which he called the Ford Quadricycle. In 1903, Henry Ford started the Ford Motor Company, and soon began selling the Model A.

But Ford’s legacy was less in automobile design, and more in his manufacturing processes. Between his assembly line, which allowed cars to be assembled quickly with standardized parts, and his decision to add small amounts of vanadium to his steel, which made the steel production process much easier (not to mention resulted in stronger and more durable steel), Ford revolutionized the way that cars were produced, allowing them to be produced quickly and cheaply – which in turn allowed them to be sold in large numbers at a low price.

All theory is gray

To deduce is to infer certain consequences from general premises (assumptions, propositions). Infer means to form an opinion, to reach a conclusion based on facts. Stated simply, to apply the general to the specific. This is a central part of how Germans think.

Deductive thinking is in German commercial law. What work processes should look like are very specifically defined. They should, for example, be based on German laws governing safety, but be shaped by overall knowledge of the respective company.

Work process, therefore, are based both on theory (safety laws) and on practice (knowhow developed over years).

The renowned German dual vocational training is based on this logic. The students in vocational schools learn at the same time theory and practice (or application). The so-called gray theory – classroom learning – is a requirement.

Rules are made to be broken

In America, refusing to deviate from the rules is often perceived as negative behavior. There is a popular saying which states that “rules are made to be broken.” American General Douglas MacArthur famously expanded on this phrase and said “Rules are mostly made to be broken and are too often for the lazy to hide behind.”

Sam Walton, the founder of the Wal-Mart chain (which became the largest corporation in the world in 2002), wrote in his autobiography that the most important rule in business is to break all of the rules. He also gave preference to rule-breakers when hiring employees, as he considered them superior workers to their rule-following counterparts.

Many of the best known American scientists and engineers were also rule-breakers. Bill Gates broke the rules with his innovative software, Henry Ford with his moving assembly line and welfare capitalism, and the Wright brothers with their fixed wing aircraft, just to name a few.

Craftsmanship

America history is made up of waves of immigration, the earliest ones bringing with them and maintaining the deep European tradition of craftsmanship. That focus on how the work is done – imbedded in what later became processes and procedures – gave way, however, to Taylorism, mechanization, mass production, and eventually to the outsourcing of manufacturing to low-wage countries.

That tradition – the European medieval guilds – craftsmanship, caring about how the work is done – is being reintroduced to the United States via its current reindustrialization. German companies, for example, are not only increasing manufacturing capacity in the U.S., they are importing their methods for training skilled workers. European, more precisely, German craftsmanship is returning to America.

Importance of price: No business culture gladly admits that price is a critical success factor. The U.S. business and consumer sectors are both strongly influenced by price. Americans buy and sell more on price than on craftsmanship.

Skeptical of deductive thinking

Americans are inherently skeptical of theory, theoretical thinking, and deductive approaches. They are empirical. For Americans „seeing is believing.“ Experience is real, factual, hard data. Experence informs. Americans prefer to build their processes from the bottom up, from „how the work is actually done.“

Process improvement: Americans asked to improve a process will imbed themselves in the inner workings of the team and the processes they use. They observe what does and does not work, what increases or decreases value, what is worth doing. They will then propose improvements, discuss these with the users of the process, then test, implement, improve upon. American process improvement is specific and experience based. It is not general and theory based.

Broad vs. Narrow: Americans distinguish between a narrow and broad process pragmatically. If the concrete actions to be taken are insufficiently spelled out in a process or a procedure, that process or procedure is not narrow enough. They are, in other words, too broad. If, on the other hand, a process or procedure demands too many deliverables, it is too narrow, focussed, inflexible.

Too many deliverables means too much time and too many man-hours are necessary without resulting in any clear value-added for the end-customer. Americans differentiate stringently between valuable and invaluable processes and steps in a process. Processes and procedures can be balanced or imbalanced. Balanced ones lead to a value-added ratio between work and results. Unbalanced processes and procedures are inefficient, costly, slow and cumbersome. They destroy value.

William Edwards Deming

William Edwards Deming (1900-1993) was an American statistician and physicist, as well as a pioneer in the field of quality management. In the 1940’s he developed the process-oriented perspective of business activities, which were later introduced into various tutorials on quality management.

However, for many years Deming’s discoveries received very little attention in the U.S. Not so in Japan. There his insights were of great interest to leading industry managers. Why? The explanation given is that in the U.S. a maximization of production volume was the primary focus of industry following the worldwide reduction of production capacity following WWII.

This was possible to do without problem in the un-damaged USA. War-torn Japan, however, had limited resources for production, which pulled the optimization of processes into the foreground.

Deming’s story is initially a comparison between the U.S. and Japan. Yet the reasons why Japan’s industries became so process-oriented surely provide insight as to how Germany became to be so process-focused as well.

Listen to the first 3.5 minutes of Steve Jobs:

Checklists

Checklists. To-do lists. Cookbook-like recipes. “Americans don’t really understand what they are doing and why. They are not trained, nor are they allowed, to think independently. There is no real mitdenken, thinking with.”

Not uncommon sentiments among Germans who interact with Americans. A misperception. Partly. Partly not.

Checklists are practical, pragmatic. They free up the mind to concentrate on more important things. They allow for self-supervision, for checking, if necessary for double-checking. They minimize unforced errors. They structure work.

For folks who do the same thing, the same way, time and again, for years, with the same colleagues, checklists surely are unnecessary. These folks can think for themselves, independently. People same. Think same. Do same.

But what about those who do different things, at different times, in different ways and with different people? Checklists become both tool and metaphor for how to manage the differences, the change, the flux.

America is constantly challenged by flux. An immigrant nation. Influx of peoples from different backgrounds, with different skill sets, levels of education. Some craftsmen. Others semi-literate. Some rooted to the land and permanent. Others who move every couple of years.

Add to this the American belief in learning by doing, and checklists – in the sense of detailed descriptions of how to do the work – become a necessity, a helpful tool, management’s assistant.

Germans learn the checklists in their extensive theoretical training. Duales Ausbildungsystem. Dual training. Over many years. Only then are they permitted to do the work. Americans learn just enough to be permitted to learn by doing. Same goal. Two approaches. Timing about the same.

Oh, and let’s not forget. Sometimes government bodies simply impose checklists.

“Have it your way!”

“The customer is always right” is a very common phrase in American business. It was first made popular in the early 20th century when it was used as the slogan for Marshall Field’s Department Store in Chicago and London’s Selfridges Store (founded by American Harry Gordon Selfridge).

Both of these stores became extremely profitable, primarily because they had a reputation for good customer service. As a result, many American businesses have attempted to model their processes on the principle that “the customer is always right.”

In 1911, in an attempt to promote a local business, the Kansas City Star newspaper included an article about the business owner George E. Scott, saying “Scott has done in the country what Marshall Field did in Chicago, Wannamaker did in New York and Selfridge in London. In his store he follows the Field rule and assumes that the customer is always right.”

Many American companies have slogans that show that they care more about customer service than anything else. Examples:

Burger King – “Have it Your Way”

UPS – “What Can Brown Do For You?”

United States Postal Service – “We Deliver for You”

Mounds and Almond Joy – “Sometimes You Feel Like a Nut, Sometimes You Don’t”

Customer Reviews

Customer reviews can make or break a company in the US. Especially now that the internet gives customers a way to instantly compliment or complain about service (and to make sure that their opinion is available for anyone to see) one good or bad review can drastically change the number of customers a company has.

In 2012, after Brandon Cook from New Hampshire posted a Facebook story about a Panera manager named Sue making a special order of clam chowder for his grandmother and giving her a free box of cookies as well. The restaurant became much more popular. Several people who would not otherwise have eaten at this restaurant went there, and commented about it online. Some of the Facebook comments that people made were:

Cyrus Twirpwhirler: “My family is eating at Panera tonight because of this story. Way to go Sue and Panera! Snow Case: That is so cool, I’m a customer already, but I like them even more now. Daniel Julian: That is so cool!!! Have to visit Panera soon.”

Purpose of processes

Procedures, policies, guidelines, compliance, and other types of structure. In the end, however, most business cultures would agree that the purpose of processes and procedures is to structure how the work should be done, and allow for repeatability, consistency, and quality control.

Processes as a success factor: If asked which are the key success factors in any enterprise most Americans would name: market/customer orientation, innovation, speed, price, service. Seldom, if ever, would they cite internal business processes.

If American customers were asked which factors are key to them when choosing a product or service they would name, among others, value and service. Value is the relationship between quality and price. It would never occur to them to say the internal business processes of the company whose product or service they are purchasing (or workmanship).

In other words, although American companies have many processes and procedures, Americans are not inclined to believe that these will ensure success.