Note: The following is a fictional case study used for the purpose of illustrating one of the most frequent causes of company breakdowns and is not meant to portray any organization or person.
“A breakdown is an interruption to the anticipated flow of living; the inability for standard practices to work.” (Alan Sieler) Things don’t go the way you planned them to go and this happens every day in each person’s life. This interruption requires coping on the part of the individual. Winning the lottery or having a flat tire are both breakdowns.
In order to cope with a breakdown, we have a basic process available to us. This is nothing earth-shattering, but is something most people do to adjust to the unexpected.
- Declare the breakdown. Simply naming it can be a great start to corrective action.
- What are the commitments being interrupted that you can’t meet? What’s your reaction to not being able to meet them?
- What are the standard practices, equipment, and/or processes that you have for dealing with breakdown?
- What network of support (what help) can you access or create?
Leadership is a lot about dealing with breakdowns. Sometimes leaders even need to create breakdowns for change to take place. What breakdowns have you created for change to take place? What breakdowns could you create to achieve the goals you have?
What breakdowns is your team facing and how are you managing them?
What breakowns can you see in the following case study?
Joe Smith knew this contract would be the turning point in ABC’s 75-year history. For years, ABC Manufacturing had been struggling to “turn the corner.” Their sales had remained fairly flat and their profit seemed to be shrinking. Joe was the VP of Sales for ABC and had been working this opportunity for the last 18 months. Now, they had an opportunity to become a subcontractor for Boeing and Joe could see the possibilities.
Joe had built relationship with key internal people, had convinced them that ABC had the competency and capacity to do the work, and touted the company’s history of producing quality product, on time, on budget as well as the workforce’s strong commitment to doing their best.
Sally Jones, Boeing’s VP of Procurement, had been with the company since graduating from the University of Washington. It was her dream job working for the company that she had admired since she was in elementary school, planning ways she could design airplanes. In fact, she had been given a tour of Boeing in sixth grade and was encouraged by the plant manager to “stay in school, get good grades, then come see us.” Now here she was, having risen through the ranks, and many thought she was definitely in line for the “C-suite.”
Boeing’s next generation airplane, the 787 Dreamliner, was going to be a game changer. Its fuel efficiency and range flexibility would enable airlines around the world to profitably open new routes as well as optimize fleet and network performance. And for passengers, it promised an experience with more comfort and less fatigue. But they needed to make sure that all their vendors were in line to produce what they needed on time, on budget, to rigorous quality parameters.
Joe had met with Sally to explore if ABC might have the capability of producing components of the wing stabilizers. Sally made it very clear what was at stake: “Joe, we’ve received an initial order for 100 787s – the largest order in our history. We’ve worked to define a plan for assembly that has no wiggle room. As you know, components are received in our Everett, Washington facility ‘just-in-time’ so that we can assemble the plane more efficiently. Components must be received on the day designated in the process or we lose time. And time is money in our business.”
“If we award you this contract, can you promise to meet our production schedule? We ramp up in another two months and we’ll need your components in the early part of production.”
Joe knew that this contract would put the company on a whole new level. Without thinking, he replied, “Sally we’d be honored to be part of this new airliner. We’ll do everything we can to make sure we meet that production schedule. I’ll just have to go back and let the operations people know what to expect. Let’s sign that contract.”
When Joe got back to the plant, he was excited about the big “win” he had landed and met with Fred Franks, the Production Manager to give him the great news. “Fred, you won’t believe this one. We’ve landed a big contract that doubles our revenues, increases our profit levels, and guarantees work for the next several years. We’re going to be making wing components for Boeing’s new 787. But we have to make sure we’re on time with delivery or the whole deal could fall through.”
Fred was in shock. “Joe, we’ve never made this component before. We don’t have the equipment set up, the experience with the kinds of materials they’re asking for, and we do have other customers who we’ve already promised product for during the time Boeing needs their first shipments. I can’t believe you sales guys always do this to us.”
“Fred, we have to figure out a way to get things in place and make this happen. It’s the game changer we’ve been waiting for. Can you make it happen?”
“I guess so… I’ll try,” Fred said with a shrug and a sigh. He was already overwhelmed; how could he get this done?
The next day, Fred called a meeting of the senior leaders to discuss the contract and his frustration. “I’ve been over the specifications and not only need to retool some of the equipment we have, but I’ll need another ten employees and have to run three shifts to make this work.”
No one said anything until Joe jumped in and said, “Fred, thanks. Just do your best.”
It soon became apparent that ABC was in over their heads. The machines couldn’t produce the components to spec. The staff was inexperienced in this and were fumbling through the learning process, making mistakes and compromising their quality reputation. The lack of people meant that some were working two shifts a day and were suffering.
Sally called after two weeks to check in with Joe. “How are things progressing? We’re starting to build some momentum and are really counting on your timely delivery of quality parts. Are you on schedule?”
“Absolutely. You have nothing to worry about. We’re working around the clock and doing the best we can.”
A month before the first delivery date, the government implemented a tariff on some of the raw materials that ABC used in production that they sourced overseas. The cost just went up. They scrambled to get other sources and found some relatively inexpensive product domestically. It wasn’t exactly the same but it was close enough. And it put their production schedule even further behind.
Fred was concerned. “There’s no way we can meet this deadline.” But Joe told him, “I have faith in your abilities. You’ve been in this situation before and you’ve always come through. I know that you’ll pull it off again this time.”
Even with Fred’s superhuman efforts, he couldn’t foresee the failure of one his key machines that was vital to the production. It was a machine made in Germany and the only techs available to service it were in Germany. This was going to put them even farther behind.
The week before scheduled delivery, Sally called Joe to check in. “Joe, we haven’t heard from you for several weeks and we’re wondering if everything’s on schedule? We’re getting close to needing your components delivered. Is everything OK?”
Joe had a million things swimming in his head. “Sally, we’ve been experiencing some problems and may not be able to deliver on time. We’re trying really hard and throwing everything we have at the project. We’ve put all our other work on hold and have all resources working 24/7 to finish. But we may not hit the deadline.”
“Joe, I can’t tell you how important this is. If you’re components aren’t here by deadline, you’ll be in breach of contract and not only will I see to it that you never work for Boeing again, I’ll do everything in my power to make sure that everyone knows about your failure to deliver. Am I clear?” And with that, she hung up the phone, leaving Joe slumped in his chair.
A knock on the door and Joe’s Admin came in. “Joe, Mr. Phipps is in the lobby wanting to see you. He’s wondering why his job isn’t going to be ready on time – and he’s not too happy.”
Deconstructing the Case Study:
- Why did this happen?
- What were the root causes of this breakdown?
- What were the critical points where things could have gotten back on track?
- What would have helped all parties – Joe, Sally, and Fred – to have coordinated action more effectively?
- What were the outcomes of this breakdown?
Problems at Work
- What are some examples of similar problems we experience at work?
- With co-workers?
- With clients?
- What are the consequences of these problems?
- Why do they happen?
© Geoff Davis, 1/24/20