Friday, May 30, 2008

Motorola's Innovation Problem

Clayton Christensen

Jack Gold, J. Gold Associates 02.01.08, 5:15 PM ET

Schaumburg, Ill.-based Motorola just announced that it is exploring options to renew its financial health, including possibly selling its mobile-handset business. Despite Moto's many problems, I don't think this makes much sense for a number of reasons.

Motorola is having some significant problems in the cellphone market, and has been for some time. Moto seems to have lost its motivation to innovate. The introduction of the RAZR line of handsets took the market by storm with its unique form factor and ergonomics. It was a come-from-behind product when Moto was down in the market. But that was several years ago. What has Motorola done since that has caught on in the market?

Meanwhile, Nokia, LG, Samsung, etc. have all moved on, competing with Moto and offering new enticing products that have built market share. Even Research in Motion's BlackBerry has gained market share at the expense of Moto. Motorola is now seen as the boxy car company while Nokia is seen as building sleeker sports cars (along with LG and Samsung).

And that is Moto's biggest problem. The company needs to come up with a winner to follow the RAZR, and it hasn't. Further, Motorola has a disjointed product line at this point, with hundreds of different phones, different styles, different operating systems (OS) and even different user interfaces, and most of them not very competitive. It needs to consolidate around a few efforts and take them forward in a concentrated matter, rather than trying to be everything to everyone and not doing it very well.

As for competitors and general strategy, Moto has a real problem, and not just from Google's new Android consortium (of which it is a member) or from the sleek iPhone from Apple. It just has too many platforms! Motorola currently has or is working on Symbian, Linux, Windows Mobile, Moto proprietary, Linux and soon Android operating systems. That's way too many to manage and creates a dilution of precious resources. No wonder it has so much trouble building a compelling product!

However, Motorola does need to play in the Linux space, as open source will be a major component of the emerging markets. But users could not care less what the OS is (do you know what the OS on your phone is?). What they want is functionality and ease of use. No one really cares what the OS of their car is, or of their DVD player or HDTV. It's about usability and functionality. That is why the iPod did so well--no one asked about its OS, but loved its functionality and the way it fit into their lifestyles. That is the puzzle piece Moto is currently missing.

But splitting off its cellphone business seems pretty drastic, like cutting off all your arms and legs. What would Moto be without the phone business, which represents the majority of its revenues? I could see potential spin-offs of some of the other businesses the company has acquired recently (like Symbol or Good Technology, which are actually making money and could generate significant cash). It was a good move to make when Moto was in better shape, but investing management time to make sure those and other businesses succeed when its core business needs so much attention may not be a good idea.

Regarding the speculation about its phone business spin-out, I suspect the statement was really made more to relieve pressure in the system than anything else. I would be shocked to see Motorola do it, but saying it is thinking about it allows the company to stifle some stockholder criticism. And I can't see anyone wanting to buy the business. Many companies are exiting the cellphone business, saying it has become too competitive and too hard to make a profit. The majors (Nokia, Samsung) probably wouldn't want the Moto business, and the smaller players (Kyocera, Huwai, etc.) probably couldn't afford it.

So I think the long-term effect is that Moto will have to rebuild its business and get its act together. In the short term, it may help Nokia somewhat. Bottom line, I don't see anyone coming along to pick up Moto's handset business in its current state.



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Thursday, May 29, 2008

How to Optimize your Inventory

 

Managing inventory in the supply chain is critical to ensure high customer service levels. However, it is also a very costly asset to maintain. Having the right amount of inventory to meet customer requirements is critical. Find out what inventory best practices reduce inventory costs across the supply chain.
Here are 4 solutions to help keep you on top of your inventory.
  • Eliminate Dead Stock
    Dead stock is 'stuff' that has been lying around for ages. I worked for a high-end clothing retailer and they sent out all of their unsold seasonal merchandise to a clearance store, marking down prices by 70%. If it did not sell there, it was shipped to an off-site warehouse (because the main warehouse was full!) where it was checked, labeled and inventoried into the system. Massive amounts of paper reports were generated and kept in logs. The merchandise sat there for one year, where it was brought out and transported back to the clearance store. Once again, if it did not sell it went back to the off-site warehouse. I even remember seeing polka-dot dresses from the 1970's in there. Even if some of those items were sold at 10% of the retail price the company would not make a profit. Smart retailers like The Gap and H&M have a markdown policy that clears merchandise in the store – no need to transport it and inventory it for many years. Make sure that you have a pro-active policy that clears dead stock.
  • Perform an ABC Analysis of your Inventory
    Pareto's Law, otherwise known as the 80/20 rule applies to Inventory Management. For example, 80% of your sales are represented by 20% of your items. Let's look at a hypothetical situation for a full-service food warehouse with 40,000 SKUs. Please refer to the the "ABC Analysis" table below.
    Only 5,000 items represent 75.7% of the annual sales volume. These SKUs are classified as 'A' items. They may include items such as milk, produce, bread and snack foods. To ensure a high level of customer service, it is imperative that these items have a high in-stock level. From a management perspective, it's sensible to keep low inventory of 'A' items and arrange for frequent replenishments, reducing capital requirements. Conversely, the strategy best suited for 'C' items is to holding inventories and looking at other alternatives such as stockless buying (discussed next). As 'B' items fall in between, they should be reviewed less often than 'A' items, however if they are 'key' items that consumers want, must be treated like 'A' items. For example, a young mother will want to purchase diapers for her new-born along with milk & bread, but if diapers are a 'B' item it must be treated as an 'A' item to ensure high customer satisfaction.
  • Arrange Stockless Buying / Systems Contracting
    A good way to understand how this arrangement works is with an example. A small boat manufacturer requires fasteners & rivets to make boats. These are small-dollar value (i.e. 'C' class) items, however having the right sizes and quantities in inventory is essential to keeping on track to the monthly production schedule. Rather than buying large quantities of these items (and risk obsolescence with future design changes) the boat manufacturer arranged a stockless buying arrangement with the fastener supplier. This is how it works: The boat manufacturer would share its monthly production schedule with the supplier. The supplier is then responsible for ensuring that an adequate supply of materials is available at the manufacturer' s facility. There is a special secured area in which the supplier keeps the inventory. When a requisition request is generated in the manufacturer' s system, it allocates inventory to production. At this point an invoice is generated and the manufacturer pays for the materials it used. This introduces beneficial process efficiencies into the management of purchasing and inventory functions for both the manufacturer and the supplier.
  • Vendor Managed Inventory Systems
    Vendor managed inventory (VMI) systems have placed the responsibility for the replenishment function to the vendors. For example, Heinz, a manufacturer of ketchup, will arrange to have its products available to its customers (grocery retailers, mass merchants, etc.). They will monitor sales and send the right quantities at the right time to ensure consumers will find Heinz ketchup on store shelves. The purchasing/order processing functions are more streamlined, allowing the management team of Heinz's customers to focus their efforts on other areas. VMI has evolved to Collaborative Planning, Forecasting and Replenishment (CPFR), which included additional partners in the supply chain. Wal-Mart, a world leader in CPFR, has its own proprietary system called Retail Link, which gives all of its suppliers information on product sales history, inventories, in-stock percent, etc. across all of its retail locations over the last two years. Suppliers are responsible to maintain an in-stock level of 98.5%. The relationship works both ways. Wal-Mart provides this information for free to help its suppliers; however their suppliers must meet the 98.5% in-stock level if they would like to remain a Wal-Mart supplier.
Use the above four solutions to reduce inventory costs in your supply chain. One of the few remaining ways to drive down inventory costs are a result of organizations becoming more collaborative and sharing their data across the supply chain.
ABC Analysis
Number of Items Percentage of Items Annual Sales Dollars ($000M) Percentage Annual Sales Volume Classification
5,000 12.5% 26,500,000 75.7% A
10,000 25% 6,250,000 17.8% B
25,000 62.5% 2,250,000 6.5% C
40,000 100% 35,000,000 100% Total



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Implementing an ERP System

 

Your organization has decided to implement an Enterprise Resource Planning (ERP) system. Whether the driver for change is that the current Legacy system is out-of-date, cannot handle the volume or is causing customer service issues, it is imperative that your organization not fall into the trap that plagued hundreds early ERP adopters. Here are a number of steps to a successful implementation as well as issues to avoid which may lead to failure.
Steps to Success
  1. Create an Implementation Team
    This team should be composed of 10-15 people in the organization that are identified as the best people in each area. Quite often Jim from Marketing is not put on the team because he is 'too busy' with driving sales, so John, a recent hire, is put on the team for fill this role. John, of course, is still learning how the company operates and is not the best candidate for the team as he has limited knowledge of processes within the Marketing area. The implementation team should report to a steering committee in the organization, which is a group of the highest level executives that have authority and responsibility for the success of the project. The steering committee should act as a guide to ensure that the timelines and objectives of the implementation are being met and to remove any roadblocks that the implementation team experiences.
  2. Document Processes in all Functional Areas
    The implementation team should then document all functional areas that will be on the ERP system. This includes Finance, Sales / Marketing, Operations and Human Resources. The team should create a process map for each area. In addition, ask employees in different areas what they like best about the current process, what they dislike and what would make things better. Not only is valuable information gained by this process, but it also involves employees and creates a shared responsibility to make the process work after the software is implemented.
  3. Select the Software
    The implementation team should undergo a software selection phase where its goal is to match the best software package to its core business processes. It is highly unlikely that it will find a 100% match. The goal is to find software that will best mirror the organization' s business processes. If the software can match to 80% of the processes, then two things must happen to get to the other 20%; either the process must be modified or the software must be customized. The decision on which option is suitable rests on whether or not the process is a core process of the organization (a core process is defined as a process that is vital to the organization and its customers).
  4. Begin Implementation
    Once the software has been selected it is time to begin the planning for the implementation. The implementation team should develop a project plan using a project planning tools (gnatt charts, etc.). Some of the main components of the process are: ensuring that the data transfer is 'clean' and that no data is lost during the transformation; creating a change management process for modifying business processes; creating a testing and approval methodology; approving the system and sign-off; and developing training processes. The implementation team should work with the supplier consultants to help them with technical issues during the implementation.
Common ERP Implementation Issues to Avoid
  • Underestimating the Cost of Implementation
    Many organizations did not realize the full extent of implementing all of the modules in an ERP system. By nature, the ERP system is highly process-oriented, and if your organization does not have all of its processes documented, you have your work cut out for you. For example, not including the cost of process mapping, will increase implementation costs and lead to frustration when the budget is increased for the project.
  • Cutting the Budget Too Soon
    As a result of increasing the budget for the ERP implementation, once the 'core' elements were in place, ancillary modules are not all turned on as they were not part of the main processes. Thus, the full benefit of the ERP system is undermined as this causes 'work arounds' that short-circuits the full value of the system. In addition, training becomes one of the first areas to suffer budget cuts. This creates problems as users have no-where to turn for help and go back to the 'old way' of doing things.
  • Branding the implementation as an IT Project
    As this is a software implementation, many organizations believe that the Information Technology (IT) function should be responsible for the implementation. This creats a dis-connect from all of the other functional areas such as Finance, Sales / Marketing and Operations who are all stakeholders but do not give adequate input into the selection decision. This results in IT making assumptions on what the business requirements were, which are almost always incorrect.
  • Not having Proper Metrics
    The first ERP implementations were a result of the Y2K bug. Rather than pay to upgrade a Legacy system, some organizations opted to install a shiny, brand-new ERP system, without calculating its Return on Investment (ROI). Each functional area in the organization should estimate what the benefits of an ERP system are; whether its eliminating redundant activities, improving order fill rates or increasing supply chain flexibility, there must be a metric that management can follow to ensure it receives the benefits of the ERP system after implementation, as well as track its progress as the modules are being implemented.. Remember, you cannot manage what you cannot measure.
By ensuring that your organization spends time understanding its processes and involving representatives of key areas, it will ensure that it has a high likelihood of success for the implementation. These efforts will pay dividends when the implementation is underway.



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A History of Logistics / Supply Chain Management

Logistics has always been a critical part as one of the 4 P's in Marketing: Product, Place, Price and Promotion. The "Place" component ensures the product is at the right place, at the right time, in the right quantity and the right quality. Read about how the logistics discipline started and where it is headed.
  • Military Roots
    Logistics received recognition in military operations during World War II. It gained its momentum as it contributed to the effective distribution of machinery and supplies to troops. A service delivery failure here may mean an increase in unnecessary fatalities. Peter Drucker (a business guru in the 1960's) identified logistics as a growing concern within business. This generated more prominence towards the practice of logistics.
  • Deregulation
    As the economies in North America evolved in the 1970's and 1980's, transportation deregulation changed the competitive landscape of business. Carriers were free to charge their customers (Shippers) a competitive rate for their shipments. Warehousing companies that typically acted as surplus inventory storage locations, married up with transportation companies to offer customers full-service solution capabilities. This formed the beginning of the 3rd party logistics business and paved the way for outsourcing logistical activities.
  • Globalization
    With the advent of globalization, firms began to seek ways of cutting their production costs. Thus, multi-national corporations re-located their factors of production to low-wage countries to gain a competitive advantage. Increasingly, more and more countries are joining the World Trade Organization (WTO) and opening their country to foreign capital investment (most recently in China). Retail giants like Wal*Mart exploit these new efficiencies and increase their imports from new emerging economies to reduce product prices in their stores. Thus, the new challenge is how to manage the product and information flows around the world. The increased pressure on managing these operations further underscored the importance of logistics as an area for optimization.
  • Information Technology
    Another contributor that led to an increased presence for logistics was the explosion in information technology and use of computers throughout the 1980's and onwards. The cost of computing has decreased year after year since then and computing power rose exponentially. The use of the Internet and increased bandwidth capacity further enhanced and enabled quick connectivity and collaborative relationships that reduced inventories and created a Just-In-Time operating opportunity for organizations. These efficiencies reduced errors, increased fill-rates and cut overall operating costs for organizations.
  • Supply Chain Management
    As the above factors fuelled efficiencies, logistics gained more prominence in organizations. A natural extension was to link the logistical operations from each firm to the entire supply chain. The new paradigm became known as the 'systems approach' to supply chain management and introduced the concept of trade-offs. In order to achieve least total supply chain cost, operational integration of the 5 main areas of logistics must be simultaneously optimized: Warehousing, Transportation, Inventory, Order Processing and Lot Quantities. Optimizing any one of these areas individually will sub-optimize the system as a whole. For example, a single warehouse in a network would achieve the lowest warehousing cost. This would create high transportation costs as suppliers ship over greater distances to ship products into the warehouse and conversely, outbound to its market distribution area. The addition of a second warehouse in the network would reduce transportation costs more than the marginal cost of operating the second warehouse, which would reduce total supply chain costs.
  • Future Challenges
    As the business landscape constantly changes with mergers & acquisitions and as globalization grows, there are corresponding changes in the supply chain that need to continuously be optimized to ensure least total supply chain costs. Radio Frequency Identification (RFID) and other technologies will continue to drive down inventories as better information is made available in a timely manner. Since supply chain activities cross over all functional areas in an organization (such as Marketing, Finance and Human Resources), new metrics must be developed to track true supply chain costs and identify the impact on new costs as corporate strategies change. Organizations that measure and benchmark these costs will have a sustainable competitive advantage going forward.



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Listening Effectively

Almost everyone sincerely believes that he or she listens effectively. Consequently, very few people think they need to develop their listening skills. But, in fact, listening effectively is something that very few of us do. It's not because listening effectively is so difficult. Most of us have just never developed the habits that would make us effective listeners.Research has found that by listening effectively, you will get more information from the people you manage, you will increase others' trust in you, you will reduce conflict, you will better understand how to motivate others, and you will inspire a higher level of commitment in the people you manage.

You Probably Don't Listen as Effectively as You Think You Do .... and You Probably Don't Know It A study of over 8,000 people employed in businesses, hospitals, universities, the military and government agencies found that virtually all of the respondents believed that they communicate as effectively or more effectively than their co-workers.1 (Could everyone be above average?) However, research shows that the average person listens at only about 25% efficiency. While most people agree that listening effectively is a very important skill, most people don't feel a strong need to improve their own skill level.

Why Effective Listening Matters

To a large degree, effective leadership is effective listening. A study of managers and employees of a large hospital system found that listening explained 40% of the variance in leadership.4 That's a big correlation by social science standards (like r = .63). Effective listening is a way of showing concern for subordinates, and that fosters cohesive bonds, commitment, and trust. Effective listening tends to reduce the frequency of interpersonal conflict

and increases the likelihood that when conflicts emerge they will be resolved with a "win-win" solution. In addition, if you listen to the people you manage, you will learn "what makes them tick." When you know what makes them tick, you will be more effective at motivating them. You can encourage them when they need encouraging, and you will know what kinds of things they value as rewards for a job well done (e.g., public praise, autonomy, challenge, etc.).

What Effective Listening Is

Effective listening is actively absorbing the information given to you by a speaker, showing that you are listening and interested, and providing feedback to the speaker so that he or she knows the message was received. Delivering verbal communication, like writing a newsletter, involves trying to choose the right words and nonverbal cues to convey a message that will be interpreted in the way that you intend. Effective listeners show speakers that they have been heard and understood

How the Most Skilled Communicators Respond When Listening

The most skilled communicators match their responses to the situation. In discussions with the people you manage, it helps to differentiate the coaching situations from the counseling situations. Coaching

is providing advice and information or setting standards to help your employees to improve their skills and their performance. Counselling

is helping subordinates recognize and address problems involving their emotions, attitudes, motivation, or personalities.

The most common mismatch of response types to situations is the tendency a lot of us have--myself included--to give advice or deflect in a situation where counseling is appropriate. When you are counseling, "reflecting" and "probing" are usually more appropriate responses than "advising" or "deflecting."

 

Reflecting. As mentioned above, when we listen we should show the other party that what they are saying to us is being heard. Since we can think at about four times the speed that speakers can speak, our brains have a lot of capacity that can be used to process the meaning of what's being said. Reflecting is paraphrasing back to the speaker what they said. A lot of us have difficulty with this skill. Reflecting without sounding phony or like a parrot takes creativity and lots of practice. Reflecting can take other forms than paraphrasing back to someone what was just said. For instance, a listener can summarize what he or she heard and also take the conversation a step further by asking a question for clarification or elaboration.

 

We often notice when we reflect during a conversation that the meaning we have ascribed to what we've heard was not really what the speaker intended to convey. When speakers hear us reflect, they get a chance to correct any misunderstanding that we have. That proves that this technique does truly clarify communication. For most of us, it takes a lot of practice before we become natural and effective at reflecting. Our first few efforts may sound forced, phony, patronizing, or as one of my MBA students put it, "moronic." However, that doesn't mean we should give up learning how to reflect. Over time, we can all learn to do it naturally and effectively.

 

Probing. In addition to reflecting, the most skilled communicators' responses in counseling situations involve a lot of probing. Probing means asking for additional information. Not all questions you might ask will be effective. Avoid questions that challenge what has been said because that will put the speaker on the defensive (e.g., "How could you have thought that?"). In addition, a question that changes the subject before the current subject is resolved isn't effective communication. Effective probing is nonjudgmental and flows from what was previously said. Good probing questions ask for elaboration, clarification, and repetition (if, for instance, an important question you asked wasn't answered).

 

Deflecting. Deflecting responses shift the discussion to another topic. When we deflect from what we've been told, rather than acknowledging it, we can unintentionally communicate that we haven't listened and that we aren't interested. Deflecting shows that we're preoccupied with another topic.

 

Many of us deflect unwittingly by sharing our personal experiences when we should be focusing on the other party. Think about this from the speaker's perspective: When you share a concern with someone and they respond by telling you about themselves, do you feel like they are interested in listening to you? The responder gives you the impression that they aren't even listening, and that they just want to talk about themselves. Sometimes we mention our own experiences as a way of saying that we can relate to the speaker's experiences. Our intention is to say, "You're not alone." But, when we tell our stories we risk sending a message that we aren't listening and don't care. Don't be a topper--the kind of person who can tell a story to top any story that they're told. We all know a topper, don't we? In a small way, toppers are trying to communicate that they are superior. That's not supportive!

 

This is not to say that sharing your experiences is never helpful. On the contrary, mentors often help their protégés by relating their own experiences as a way to reassure their protégés that their concerns are normal and that their problems are solvable. But, in counseling situations, be careful to use deflecting only at appropriate times. Speakers may not know that you have heard and understood what they have said if you deflect by moving on to another topic or shifting the focus to yourself or your own experiences. The best listeners keep deflecting to a minimum.

 

Advising. Did you know that you can offend some people by giving them advice after they've told you about one of their concerns? In fact, Deborah Tannen's research has found that this problem is particularly common between men and women in the workplace.5 Women often discuss their problems and concerns with men just as a means of developing interpersonal bonds. It's a way of making conversation that goes a little deeper than small talk (because it's personally revealing), and it can help foster a mutually supportive relationship. When men respond by giving advice, they may believe they are being helpful to their female counterparts. But, when no advice is solicited, providing it is actually a little presumptuous. When you tell someone how they should solve their problems you assume a position of superiority, not mutuality. Of course, being supportive often involves giving advice. My point is that we should (a) recognize that sometimes people share their problems with us just because they want us to listen, and (b) advising people who tell us about their problems can sometimes be taken as condescending or belittling. Sometimes it's better to just reflect.

Typical Objections to These Effective Listening Techniques

As I teach these principles to managers on and off campus, I hear a lot of objections to using them. Here are three common objections:

Reflecting slows down the conversation and wastes time. Yes, your time is a valuable resource, and you do want to invest it carefully. Reflecting takes time, but it can save time too. Many times reflecting does more than show the other party that they are being heard; it also serves as a check for accurate understanding and provides an opportunity for clarification. Reflecting takes time, but so does correcting errors due to miscommunication.

Reflecting sounds phony/patronizing/moronic. Skilled listeners know that tactfully showing that you have heard what someone has said by reflecting it back to them requires creativity, and they've had to practice creative paraphrasing and reflecting to become good at it. Yes, the process of learning how to use reflecting can be awkward for people who are inexperienced with it. However, be very careful not to avoid practicing and learning a skill just because you're concerned that you will not immediately be proficient. It's better to develop communication skills over time, despite the possible awkward stage, than to completely avoid developing those skills due to a fear of the initial awkwardness.

I don't have time to be the confidante of all my direct reports. Yes, there is a time management

issue. It might seem that the best way to use your time is to hear the problems, give advice, and move on. That may or may not be good time management. Think carefully about the consequences of showing your staff that spending time listening to them is not important enough to be a high priority for you. Managers who make listening a high priority develop strong relationships, employee commitment and a support network for themselves.

Practicing This Management Skill

Fortunately for those of us who want to develop our listening skills, we get lots of opportunities. To develop your listening skills, plan to use the response type that you think you need to emphasize (e.g., reflecting) and plan to avoid using the response types that you want to de-emphasize (e.g., advising). Then, after you have a conversation, evaluate how effective you were at giving good responses as a listener. Identify what went well and where the opportunities for improvement are. Think about what that challenges to being an effective listener were and how you can deal with those challenges more effectively next time.

Monday mornings are a perfect time to practice your effective listening. Just start a conversation with a co-worker or employee by saying, "How was your weekend?" From there, just probe and reflect. In ten minutes, you can actually get to know the other person a little better and show that you're interested in them.

Kids seem to be willing to let us practice our effective listening. Seems like if you ask kids questions, reflect their answers back to them and probe a little further, they really open up. It's like you're their new best friend because you've shown an interest in them. They'll forgive us if we sound a little patronizing--they're used to it. Making a tape recording of a conversation, if you can find a willing partner, can also help you evaluate your performance. With a tape of a conversation, you can examine each response you give in detail, without relying on your memory.



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Wednesday, May 28, 2008

Basics of Production Inventory Management

Production inventory management differs from general
warehouse management because it involves the
determination of how quickly to produce a particular
product. The factors involved in many cases are
similar, though there are some variances in making the
final decision as to how quickly manufacturing should
push items through the production line.

Available Materials

Of course, the first concern in production inventory
management is on the front end of the process. If you
don't have the materials required for production, then
you can't move forward in providing the products to
others. You must make certain that you have all the
supplies you need, from raw materials to factory
workers, to complete the production process.

Supply and Demand

You must determine the current demand for the product
on the market. Good production inventory management
occurs when you produce just enough material to
satisfy customers' needs without overextending the
production line and manufacturing too many of any
given product. You don't want an incredible amount of
backstock lying around, as this detracts from your net
profit. On the other hand, you don't want to be in
short supply when a large order comes in, so having a
little extra on hand is a great idea, and making sure
you are prepared to make a production run for such
orders is vital.

Quality Control

Never simply assume that everything manufactured will
be flawless. An important consideration in production
inventory management is to allow room for error. In
other words, calculate a sufficient amount of product
to assume that, even with flaws that get past quality
control efforts, there is sufficient stock of the
product required.

Cost Analysis

In many instances, even the best production inventory
management strategies fail in the long run due to the
cost of the production process being overlooked as a
factor. It is important to maintain a cost effective
production process, and this includes making sure that
your inventory is not an overwhelming factor. This
comes back to not overproducing any items that come
off the assembly lines. Doing so is a waste of time
and materials, costing you excess money to create.
Obviously, conservation of the materials, time, and
energy consumed in manufacturing unnecessary goods is
essential to maintaining a cost effective production
inventory management strategy.

Be proactive in keeping close watch on all occurrences
in your production or manufacturing facility to make
sure that there is no waste, and you are guaranteed to
achieve a greater standard of success and profitability.


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Tuesday, May 27, 2008

Goal Setting

Strategies for a Balanced Life

by  Dinae M. Eade

 

Caught up in the hectic daily activities of clinical practice and administration, health care practitioners can easily lose sight of long-term goals … easily forget what they set out to accomplish for themselves and for their loved ones. Yet proven strategies exist to help busy professionals achieve happy, healthy, productive, and well-balanced lives. To help you regain some perspective, an expert in life planning and personal productivity presents the following tips.

"To be what we are, and to become what we are capable of becoming, is the only end of life," wrote Robert Louis Stevenson in Familiar Studies of Men and Books1. Simple as that goal may sound, most people get so caught up in the day-to-day activities of living that they never come even close to realizing their full potential or their lifelong dreams.

Physician assistants and nurse practitioners, like other health care providers, are particularly vulnerable to this "activities-of-daily-living" trap. Starting with The Oath of Hippocrates ("With purity and holiness I will pass my life and practice my Art.... Into whatever houses I enter, I will go into them for the benefit of the sick....") and ending with the rigors of daily practice, health care demands personalities willing to place the needs of others ahead of self. Does this leave the practitioner with no time to pursue personal goals and dreams? Sometimes. But there are ways to assure personal growth and fulfillment, which ultimately improve a provider's ability to care for others.

GOAL PLANNING: WHY BOTHER?

Goal planning challenges the individual to give life a preplanned direction by employing specific exercises and strategies. Through goal planning, a person can take the shapeless life "direction" that most professionals have fermenting in the back of their minds - that fatalistic voice that says "work hard, do your best, and let whatever happens happen" - and learn to control many of the key events that ultimately give form to a person's life.

The first step in goal planning is to ascertain the control you do have over your life. Try this exercise: First, on a clean sheet of paper, list the past five years vertically along the left side (1994,1993,1992,1991, and 1990).. Next to each year, list the most important event that occurred in your life during that year. Now examine that list and estimate the percentage of control or influence that you had over those events.

After using this exercise with numerous groups, I've observed that most people exert a significant influence over at least 80% of the most notable developments in their lives. Too few, however, take the time to reflect on their influence, allowing themselves to drift into believing that external forces really chart the course. Seeing how much control you personally exert over your life helps you to realize that you really are in charge, and that you can chart a course to success.

How does someone actually plan for success in advance, rather than letting things happen and hoping for the best? Skeptics still balk; even though, in retrospect, they acknowledge some influence over events, they do not concede an ability to plan these events in advance. To some degree, their argument is true: Goal setting is not a crystal ball, nor does it carry with it any guarantees. But goal setting definitely improves your odds for a successful outcome.

Many companies use "Management By Objectives" (MBOs) to motivate their work staff to higher levels of achievement. This is a simple method of translating an organization's business objectives down to each individual's specific contribution. For instance, if the goal for your entire office is to see 500 patients each week, your individual objective might be to see 125 of those patients personally.

In one review of studies on MBOs2, 66 out of 68 studied (97%) attributed positive results to their use. In fact, in 28 studies using objective measurements, productivity was shown to increase by 44%. The studies also showed that when commitment on the part of the management is high, results are even better. When goals are personal and individual, rather than corporate or vague, they are more readily adopted.

TARGETING YOUR GOALS

To get the most out of each aspect of your life, start by creating a life plan from which to set specific goals. This way you'll know where you want to end up. Setting goals "programs" our minds: The goals we set direct our mental focus. Subconsciously, the mind works continuously to satisfy the expressed need.

Notice that, here again, I said "life plan," not "career plan." Goal setting has application far beyond one's career. In fact, those people who set only business-related goals decrease their odds of having a well-balanced, happy life: Those who direct their subconscious to solve only business problems risk creating lives that focus on careers and neglect all other areas.

MEASURE YOUR LIFEBALANCE

Use The Wheel of Life to measure your overall degree of life satisfaction and to identify areas that might benefit from goal-setting. On a scale of 1 to 10 (where 1 is low and 10 is high), ask yourself how satisfied you are with your: financial situation and career; social and cultural situations; spirituality and ethics; family and home; mental and educational levels; and physical well-being and health. Consider your answers carefully, taking into account the following issues:


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