Without motivation, every business will fail, every team will lose, and every goal will lie unmet. Motivation makes things happen. It is what drives you to do what you do. It's your purpose, your reason for getting out of bed in the morning. It's what's in it for you. What are three of the basic keys to effective motivation?
Ultimately, motivation can be broken down into two types, intrinsic and extrinsic. Extrinsic motivating forces are those physical rewards we will receive when we accomplish whatever it is we want to accomplish. For instance, a paycheck is an extrinsic motivator that gets you to do some work. A better looking figure is a motivator for exercising. An award or prize can be an effective extrinsic motivator if you find yourself working hard to win it. Intrinsic motivating forces, on the other hand, are those motivators that come from within us. Confidence and self-esteem will grow if we work hard toward our goals. These interior feelings are examples of intrinsic motivators. Wishing to live up to a spiritual or social standard is another. Feeling guilty or proud can motivate us to change the things we do, as well. Finding three keys to motivation means analyzing what motivates you both on the outside and on the inside, and letting these rewards change your behavior.
Key Number One: Love your work. Do you like what you do? Did you choose your business because you were inspired to do it, or did it seem like a good idea because someone else made money at it? Unless you really love and value what you're working at, it is likely to become a drag eventually, regardless of how easy-going you are. Of course, even working at your dearest passion involves drudgery and routine from time to
time. Still, if you don't love your work, it might be time to rethink what you're doing, or find a new way to look at it.
Key Number Two: Reduce clutter. Having things piled up really saps a person's energy. Learn to take action on papers that come your way before they pile up. A lot of the lack of organization is really just a matter of putting off making decisions. You hesitate to throw a piece of mail away because you are mildly interested in it and might want to look at it again some day. When this happens 5 or more times a day, you soon have stacks of paper you'll never be able to organize so that you'd find any one item again. Be quicker to throw things out in the beginning. Chances are, you'll get another one pretty soon, anyway.
Key Number Three: Have written goals, both large and small. Most businesses have a written plan that includes the big picture and the big goals. This is good, because you want to know what the ultimate target is. Still, it is helpful to morale and motivation to have those big goals broken down into manageable bites. What can you do right now as a stepping stone to seeing that big goal come about? Write it down, do it, and then
reward yourself some way.
Wednesday, April 9, 2008
Tuesday, April 8, 2008
THE MAGIC OF TEAM WORK
(One Indian = 10 Japanese, 10 Indians = One Japanese)
Lack of teamwork and co-operation is one of the most serious problems affecting progress in all areas of India and wherever Indians work worldwide. The key problem in India is always implementation, not lack of policies. We have great policies and ideas about how to do things, but severely lacking teamwork.
When the Japanese came to work in India to develop the Maruti Suzuki car, a joke went around that one Indian was equal to 10 Japanese: Indians were very smart, capable and dedicated individuals. But 10 Indians were equal to 1 Japanese: Indians lacked team spirit and co-operation.
What makes matters even worse is our "crab" mentality – if someone is trying to climb higher and achieve more, the others just drag him down. The signal that the others send out is, " I wouldn't do it; I wouldn't let you do it; and if by change you start succeeding, we will all gang up and make sure that you don't get to do it."
The question is: Where does this attitude come from, and how do we recognize and handle it?
Hierarchical System
Part of the problem is our cultural background. We've had feudal and a hierarchical social system in which whoever is senior supposedly knows best. This was fine in earlier times when knowledge and wisdom were passed on orally; but in modern society, there is no way that one person can know everything. Today, you may find that a young computer-trained person has more answers for an accounting problem than a senior accountant has. Until we understand how best to leverage this diversity of experience, we will not be able to create and fully utilize the right kind of teams.
Sam Pitroda: " In my younger days in the US, I attended an executive seminar for Rockwell International, where about 25 senior company executives had congregated for a week for strategic discussion. In the evenings, we would break out into five different groups of five people each. In those group workshops, someone would delegate tasks, saying: " You make coffee; you take notes; you are the chairman; and you clean the board". The next day, there would be different duties for each group member. No one ever said, " But I made coffee twice or I cleaned the board entire day". I thought to myself, if this were happening in India, people would be saying, " But I'm the senior secretary – why should I make the coffee and you be the chairman?" Hierarchy comes naturally to our minds.
What Derails a Team?
Group work requires a thorough understanding of the strengths and weaknesses of individuals irrespective of their hierarchy. Because of our background, we often don't learn how to exercise and accept leadership- to lead and to follow – simultaneously. Some gravitate toward exercising leadership, and others gravitate toward accepting the lead of others. But in true teamwork, everyone needs to do both.
Being a good team player implies respect for others, tolerance of different points of view and willingness to give. The ability to resolve conflicts without either egotism or sycophancy is a very important aspect of being a team player: You have to agree to disagree. I find that people in India somehow tend to focus on achieving total agreement, which is almost always impossible. So before work begins people want everyone to agree on everything instead they should say OK. This is what we agree on, so let's start working on this. What we don't agree on, we will resolve as we go along". For things to move forward, it's important to work on the agreed-upon aspects and not get bogged down in the areas of disagreement. Yet another snake that kills teamwork is people's political agendas. You've got to be open, clear and honest to be a good team player. Most people though, have a hidden agenda – they say something but mean the exact opposite. I call it "split-level consciousness". To say and mean the same thing is a very critical part of a good work ethic.
Criticizing the individual or the idea?
When Sam was working in C-DOT (400 employee size company), If someone had not been doing well, Sam used to tell the person directly to his face in a general meeting. The employees said that was insulting and they should be pulled aside individually to be told of the inefficiency. But in today's world, you cannot afford to do that every time. Besides, Sam figured that criticizing someone in a meeting was for the benefit of all present, and everyone could learn from that individual's mistakes. It was then that Sam learned how Indians do not differentiate between criticizing an idea and criticizing an individual.
So in a group, if you tell someone that his idea is no good, he automatically takes it personally and assumes that you are criticizing him. No one can have a good idea everyday on every issue. If you disagree with my idea, that does not mean that you have found fault with me as a person. Thus, it is perfectly acceptable for anyone to criticize the boss - but this concept is not a part of the Indian System. So from time to time, it is important for an organization's Chief Executive to get a report on the psychological health of the firm. How do people in the team feel? Are they stable? Confident? Secure? Comfortable? These are the key elements of a team's success. For a boss to be comfortable accepting criticism from subordinates, he must feel good about himself. Self-esteem is a key prerequisite to such a system being successful.
Mental Vs. Physical Workers
Another serious problem facing India is the dichotomy and difference in respectability between physical and mental workers, which seriously affects team performance.
Mr. Sam had a driver named Ram, who he thought was one of the best drivers in the world. He used to open the door for him whenever he entered or exited the car. Right in the first few days Sam told him " Ram bhai, you are not going to open the door for me. You can do that If I lose my hands". Ram almost started crying. He said, " Sir, what are you saying? This is my job!" Sam told him that I didn't want to treat him like a mere driver. He had to become a team player. Sam told him that whenever he was not driving, he should come into office and help out with office work - make copies, file papers, send faxes, answer phone call or simply read - rather than sit in the car and wait for me to show up.
Diversifying tasks increases workers' self-esteem and motivation and makes them team players. Now, even If Sam calls him for work in the middle of the night, he is ready - because Sam respects him for what he does. Team Interactions unfortunately, when good teams do get created, they almost invariably fall apart. In our system today it is very difficult to build teams because nobody wants to be seen playing second fiddle. It is very hard in India to find good losers. Well, you win some and you lose some. If you lose some, you should move on! You don't need to spend all your time and energy of different cultural backgrounds, religions, ethnicities and caste groups - a fertile ground of diversity in the workplace. We should actually be experts in working with diversity. But it can only happen when we get rid of personal, caste and community interests.
There could be a 40-year-old CEO with a 55-year-old VP. It has nothing to do with age; capability and expertise are what counts. But you don't yet see these attitudes taking hold in India. Managers in the US corporate environment who work with Indians - and in fact, with Asians in general - need to recognize that these individuals have a tendency to feel that they are not getting recognition or are not being respected. It must be realized that these individuals have lower self-esteem to begin with and therefore have to be pampered and encouraged a little more because they need it. This makes them feel better and work better. No Substitute for Teamwork. Teamwork is key to corporate and national governance, and to get anything done.
The fundamental Issues are respect for others, openness, honesty, communication, willingness to disagree, resolution of conflict, and recognition that the larger goal of the team as a whole rumps Individual or personal agendas.
Don't be afraid of pressure.
Remember that Pressure is what turns a lump of coal into a diamond.
Lack of teamwork and co-operation is one of the most serious problems affecting progress in all areas of India and wherever Indians work worldwide. The key problem in India is always implementation, not lack of policies. We have great policies and ideas about how to do things, but severely lacking teamwork.
When the Japanese came to work in India to develop the Maruti Suzuki car, a joke went around that one Indian was equal to 10 Japanese: Indians were very smart, capable and dedicated individuals. But 10 Indians were equal to 1 Japanese: Indians lacked team spirit and co-operation.
What makes matters even worse is our "crab" mentality – if someone is trying to climb higher and achieve more, the others just drag him down. The signal that the others send out is, " I wouldn't do it; I wouldn't let you do it; and if by change you start succeeding, we will all gang up and make sure that you don't get to do it."
The question is: Where does this attitude come from, and how do we recognize and handle it?
Hierarchical System
Part of the problem is our cultural background. We've had feudal and a hierarchical social system in which whoever is senior supposedly knows best. This was fine in earlier times when knowledge and wisdom were passed on orally; but in modern society, there is no way that one person can know everything. Today, you may find that a young computer-trained person has more answers for an accounting problem than a senior accountant has. Until we understand how best to leverage this diversity of experience, we will not be able to create and fully utilize the right kind of teams.
Sam Pitroda: " In my younger days in the US, I attended an executive seminar for Rockwell International, where about 25 senior company executives had congregated for a week for strategic discussion. In the evenings, we would break out into five different groups of five people each. In those group workshops, someone would delegate tasks, saying: " You make coffee; you take notes; you are the chairman; and you clean the board". The next day, there would be different duties for each group member. No one ever said, " But I made coffee twice or I cleaned the board entire day". I thought to myself, if this were happening in India, people would be saying, " But I'm the senior secretary – why should I make the coffee and you be the chairman?" Hierarchy comes naturally to our minds.
What Derails a Team?
Group work requires a thorough understanding of the strengths and weaknesses of individuals irrespective of their hierarchy. Because of our background, we often don't learn how to exercise and accept leadership- to lead and to follow – simultaneously. Some gravitate toward exercising leadership, and others gravitate toward accepting the lead of others. But in true teamwork, everyone needs to do both.
Being a good team player implies respect for others, tolerance of different points of view and willingness to give. The ability to resolve conflicts without either egotism or sycophancy is a very important aspect of being a team player: You have to agree to disagree. I find that people in India somehow tend to focus on achieving total agreement, which is almost always impossible. So before work begins people want everyone to agree on everything instead they should say OK. This is what we agree on, so let's start working on this. What we don't agree on, we will resolve as we go along". For things to move forward, it's important to work on the agreed-upon aspects and not get bogged down in the areas of disagreement. Yet another snake that kills teamwork is people's political agendas. You've got to be open, clear and honest to be a good team player. Most people though, have a hidden agenda – they say something but mean the exact opposite. I call it "split-level consciousness". To say and mean the same thing is a very critical part of a good work ethic.
Criticizing the individual or the idea?
When Sam was working in C-DOT (400 employee size company), If someone had not been doing well, Sam used to tell the person directly to his face in a general meeting. The employees said that was insulting and they should be pulled aside individually to be told of the inefficiency. But in today's world, you cannot afford to do that every time. Besides, Sam figured that criticizing someone in a meeting was for the benefit of all present, and everyone could learn from that individual's mistakes. It was then that Sam learned how Indians do not differentiate between criticizing an idea and criticizing an individual.
So in a group, if you tell someone that his idea is no good, he automatically takes it personally and assumes that you are criticizing him. No one can have a good idea everyday on every issue. If you disagree with my idea, that does not mean that you have found fault with me as a person. Thus, it is perfectly acceptable for anyone to criticize the boss - but this concept is not a part of the Indian System. So from time to time, it is important for an organization's Chief Executive to get a report on the psychological health of the firm. How do people in the team feel? Are they stable? Confident? Secure? Comfortable? These are the key elements of a team's success. For a boss to be comfortable accepting criticism from subordinates, he must feel good about himself. Self-esteem is a key prerequisite to such a system being successful.
Mental Vs. Physical Workers
Another serious problem facing India is the dichotomy and difference in respectability between physical and mental workers, which seriously affects team performance.
Mr. Sam had a driver named Ram, who he thought was one of the best drivers in the world. He used to open the door for him whenever he entered or exited the car. Right in the first few days Sam told him " Ram bhai, you are not going to open the door for me. You can do that If I lose my hands". Ram almost started crying. He said, " Sir, what are you saying? This is my job!" Sam told him that I didn't want to treat him like a mere driver. He had to become a team player. Sam told him that whenever he was not driving, he should come into office and help out with office work - make copies, file papers, send faxes, answer phone call or simply read - rather than sit in the car and wait for me to show up.
Diversifying tasks increases workers' self-esteem and motivation and makes them team players. Now, even If Sam calls him for work in the middle of the night, he is ready - because Sam respects him for what he does. Team Interactions unfortunately, when good teams do get created, they almost invariably fall apart. In our system today it is very difficult to build teams because nobody wants to be seen playing second fiddle. It is very hard in India to find good losers. Well, you win some and you lose some. If you lose some, you should move on! You don't need to spend all your time and energy of different cultural backgrounds, religions, ethnicities and caste groups - a fertile ground of diversity in the workplace. We should actually be experts in working with diversity. But it can only happen when we get rid of personal, caste and community interests.
There could be a 40-year-old CEO with a 55-year-old VP. It has nothing to do with age; capability and expertise are what counts. But you don't yet see these attitudes taking hold in India. Managers in the US corporate environment who work with Indians - and in fact, with Asians in general - need to recognize that these individuals have a tendency to feel that they are not getting recognition or are not being respected. It must be realized that these individuals have lower self-esteem to begin with and therefore have to be pampered and encouraged a little more because they need it. This makes them feel better and work better. No Substitute for Teamwork. Teamwork is key to corporate and national governance, and to get anything done.
The fundamental Issues are respect for others, openness, honesty, communication, willingness to disagree, resolution of conflict, and recognition that the larger goal of the team as a whole rumps Individual or personal agendas.
Don't be afraid of pressure.
Remember that Pressure is what turns a lump of coal into a diamond.
Thursday, April 3, 2008
A Rich Neighbor Named Xerox
Author:
Andy Hertzfeld
Date:
November 1983
Summary:
Steve confronts Bill Gates about copying the Mac
The Xerox Star was an influential predecessor
hen Steve Jobs recruited Microsoft to be the first third party applications software developer for the Macintosh, he was already concerned that they might try to copy our ideas into a PC-based user interface. As a condition of getting an early start at Macintosh development, Steve made Microsoft promise not to ship any software that used a mouse until at least one year after the first shipment of the Macintosh. Microsoft's main systems programmer assigned to the Mac project was Neil Konzen, a brilliant young Apple II hacker who grew up in their backyard in the suburbs of Seattle. Neil started working at Microsoft while he was still a high school student, and single-handedly implemented the system software for their hit Z80 card that allowed the Apple II to run CP/M software. Neil loved Apple, so it was natural for Microsoft to assign him to their new, top-secret Macintosh project. He was responsible for integrating Microsoft's byte-code based interpreted environment (which actually was a copy of a system used at Xerox that favored memory efficiency over execution speed, which was appropriate for the Mac's limited memory) with the rapidly evolving Macintosh OS, so he quickly became Microsoft's expert in the technical details of the Mac system. By the middle of 1983, Microsoft was far enough along to show us working prototypes of their spreadsheet and business graphics programs, Multiplan and Chart (they were also working on a word processor, but they neglected to mention that, since it would compete with MacWrite). I would usually talk with Neil on the phone a couple of times a week. He would sometimes request a feature that I would implement for him, or perhaps complain about the way something was done. But most of the time I would answer his various questions about the intricacies of the still evolving API. I gradually began to notice that Neil would often ask questions about implementation details that he didn't really need to know about. In particular, he was really curious about how regions were represented and implemented, and would often detail his theories about them to me, hoping for confirmation. Aside from intellectual curiosity, there was no reason to care about the system internals unless you were trying to implement your own version of it. I told Steve that I suspected that Microsoft was going to clone the Mac, but he wasn't that worried because he didn't think they were capable of doing a decent implementation, even with the Mac as an example. In November 1983, we heard that Microsoft made a surprising announcement at Comdex, the industry's premier trade show, held twice a year in Las Vegas. Microsoft announced a new, mouse-based system graphical user interface environment called Windows, competing directly with an earlier environment announced by Personal Software called "Vision". They also announced a mouse-based option for Microsoft Word. When Steve Jobs found out about Windows, he went ballistic. "Get Gates down here immediately" , he fumed to Mike Boich, Mac's original evangelist who was in charge of our relationships with third party developers. "He needs to explain this, and it better be good. I want him in this room by tomorrow afternoon, or else!" And, to my surprise, I was invited to a meeting in that conference room the next afternoon, where Bill Gates had somehow manifested, alone, surrounded by ten Apple employees. I think Steve wanted me there because I had evidence of Neil asking about the internals, but that never came up, so I was just a fascinated observer as Steve started yelling at Bill, asking him why he violated their agreement. "You're ripping us off!", Steve shouted, raising his voice even higher. "I trusted you, and now you're stealing from us!" But Bill Gates just stood there coolly, looking Steve directly in the eye, before starting to speak in his squeaky voice. "Well, Steve, I think there's more than one way of looking at it. I think it's more like we both had this rich neighbor named Xerox and I broke into his house to steal the TV set and found out that you had already stolen it." Unfortunately, it turned out that while the agreement that Microsoft signed in 1981 stipulated that they not ship mouse-based software until a year after the Mac introduction, that ended up being defined in the contract as September 1983, since in late 1981 we thought that the Mac would ship in the fall of 1982, and we foolishly didn't let the ship date float in the contract. So Microsoft was within their rights to announce Windows when they did. Apple still needed Microsoft's apps for the Macintosh, so Steve really couldn't cut them off. Microsoft didn't manage to ship a version of Windows until almost two years later, releasing Windows 1.0 in the fall of 1985. It was pretty crude, just as Steve had predicted, with little of the Mac's thoughtful elegance. It didn't even have overlapping windows, preferring a simpler technique called "tiling". When its utter rejection became apparent a few months later, Bill Gates fired the implementation team and started a new version from scratch, led by none other than Neil Konzen. Neil's version of Windows, released a couple of years later, was good enough that Apple filed a monumental copyright lawsuit against Microsoft in 1988, but they eventually lost on a technicality (the judge ruled that Apple inadvertently gave Microsoft a perpetual license to the Mac user interface in November 1985).
Andy Hertzfeld
Date:
November 1983
Summary:
Steve confronts Bill Gates about copying the Mac
The Xerox Star was an influential predecessor
hen Steve Jobs recruited Microsoft to be the first third party applications software developer for the Macintosh, he was already concerned that they might try to copy our ideas into a PC-based user interface. As a condition of getting an early start at Macintosh development, Steve made Microsoft promise not to ship any software that used a mouse until at least one year after the first shipment of the Macintosh. Microsoft's main systems programmer assigned to the Mac project was Neil Konzen, a brilliant young Apple II hacker who grew up in their backyard in the suburbs of Seattle. Neil started working at Microsoft while he was still a high school student, and single-handedly implemented the system software for their hit Z80 card that allowed the Apple II to run CP/M software. Neil loved Apple, so it was natural for Microsoft to assign him to their new, top-secret Macintosh project. He was responsible for integrating Microsoft's byte-code based interpreted environment (which actually was a copy of a system used at Xerox that favored memory efficiency over execution speed, which was appropriate for the Mac's limited memory) with the rapidly evolving Macintosh OS, so he quickly became Microsoft's expert in the technical details of the Mac system. By the middle of 1983, Microsoft was far enough along to show us working prototypes of their spreadsheet and business graphics programs, Multiplan and Chart (they were also working on a word processor, but they neglected to mention that, since it would compete with MacWrite). I would usually talk with Neil on the phone a couple of times a week. He would sometimes request a feature that I would implement for him, or perhaps complain about the way something was done. But most of the time I would answer his various questions about the intricacies of the still evolving API. I gradually began to notice that Neil would often ask questions about implementation details that he didn't really need to know about. In particular, he was really curious about how regions were represented and implemented, and would often detail his theories about them to me, hoping for confirmation. Aside from intellectual curiosity, there was no reason to care about the system internals unless you were trying to implement your own version of it. I told Steve that I suspected that Microsoft was going to clone the Mac, but he wasn't that worried because he didn't think they were capable of doing a decent implementation, even with the Mac as an example. In November 1983, we heard that Microsoft made a surprising announcement at Comdex, the industry's premier trade show, held twice a year in Las Vegas. Microsoft announced a new, mouse-based system graphical user interface environment called Windows, competing directly with an earlier environment announced by Personal Software called "Vision". They also announced a mouse-based option for Microsoft Word. When Steve Jobs found out about Windows, he went ballistic. "Get Gates down here immediately" , he fumed to Mike Boich, Mac's original evangelist who was in charge of our relationships with third party developers. "He needs to explain this, and it better be good. I want him in this room by tomorrow afternoon, or else!" And, to my surprise, I was invited to a meeting in that conference room the next afternoon, where Bill Gates had somehow manifested, alone, surrounded by ten Apple employees. I think Steve wanted me there because I had evidence of Neil asking about the internals, but that never came up, so I was just a fascinated observer as Steve started yelling at Bill, asking him why he violated their agreement. "You're ripping us off!", Steve shouted, raising his voice even higher. "I trusted you, and now you're stealing from us!" But Bill Gates just stood there coolly, looking Steve directly in the eye, before starting to speak in his squeaky voice. "Well, Steve, I think there's more than one way of looking at it. I think it's more like we both had this rich neighbor named Xerox and I broke into his house to steal the TV set and found out that you had already stolen it." Unfortunately, it turned out that while the agreement that Microsoft signed in 1981 stipulated that they not ship mouse-based software until a year after the Mac introduction, that ended up being defined in the contract as September 1983, since in late 1981 we thought that the Mac would ship in the fall of 1982, and we foolishly didn't let the ship date float in the contract. So Microsoft was within their rights to announce Windows when they did. Apple still needed Microsoft's apps for the Macintosh, so Steve really couldn't cut them off. Microsoft didn't manage to ship a version of Windows until almost two years later, releasing Windows 1.0 in the fall of 1985. It was pretty crude, just as Steve had predicted, with little of the Mac's thoughtful elegance. It didn't even have overlapping windows, preferring a simpler technique called "tiling". When its utter rejection became apparent a few months later, Bill Gates fired the implementation team and started a new version from scratch, led by none other than Neil Konzen. Neil's version of Windows, released a couple of years later, was good enough that Apple filed a monumental copyright lawsuit against Microsoft in 1988, but they eventually lost on a technicality (the judge ruled that Apple inadvertently gave Microsoft a perpetual license to the Mac user interface in November 1985).
Size matters
Growing your business comes down to basic multiplication- -just make sure you add in the human factor.
By Robert Kiyosaki Entrepreneur Magazine - April 2008
One of the biggest dilemmas you will face after you get your business up and running is the decision to either grow or stay small. Obviously, most entrepreneurs opt to keep their businesses small because it's much easier to control and manage a small business. And that's because growth requires people. As my rich dad often said, "Business would be easy if not for people." If you choose to grow your business, being able to lead and manage people is one of the most important skills you can possess.
As the number of people grows, the number of relationships grows--and grows exponentially once you have four people in the business. For example, a one-person business has zero relationships; add a second person, and the relationship dynamic kicks in. Add another person: three people and three relationships. But look what happens with the fourth person: four people and six relationships. Visualize each person as a dot, and draw a connecting line between each of the dots. You'll see that with four people, you'll have six connecting lines. Take it a few steps further and do the math: Seven people equals 21 relationships; 100 people means 4,950 relationships!
Many businesses grow by adding employees, then contract because they fail to grow internal communications systems and procedures. Instead of employees working together as a team to serve their customers, the exponential number of relationships causes internal chaos.
One of the problems with exponential growth of relationships is that it requires managers and leaders with exceptional people skills. But many entrepreneurs make the mistake of hiring team members that have great technical skills but lack equally great people, communication and leadership skills.
A few years ago, I brought on a brilliant attorney who was great at practicing law but absolutely horrible when it came to working with people. It was soon obvious to me that this attorney should only be in a windowless, one-person office and kept far away from contact with any other living creature. It took nearly a year to repair the damage this single brilliant technician did in just four months.
Before adding employees, you must honestly answer the following questions:
How are my/their leadership skills?
How are my/their organizational skills?
How are my/their people skills?
Then it all comes back to the age-old question: "How do you find great people?"
To answer this, I turn to my good friend Donald Trump, who says, "Set the example and you will be a magnet for the right people." That means doing what you say you will do, holding yourself to the highest standards, working to exceed expectations, learning from your mistakes and then sharing those lessons with others.
Robert Kiyosaki(richdad. com), author of the Rich Dad series of books, is an investor, entrepreneur and educator whose perspectives have changed the way people think about money and investing.
By Robert Kiyosaki Entrepreneur Magazine - April 2008
One of the biggest dilemmas you will face after you get your business up and running is the decision to either grow or stay small. Obviously, most entrepreneurs opt to keep their businesses small because it's much easier to control and manage a small business. And that's because growth requires people. As my rich dad often said, "Business would be easy if not for people." If you choose to grow your business, being able to lead and manage people is one of the most important skills you can possess.
As the number of people grows, the number of relationships grows--and grows exponentially once you have four people in the business. For example, a one-person business has zero relationships; add a second person, and the relationship dynamic kicks in. Add another person: three people and three relationships. But look what happens with the fourth person: four people and six relationships. Visualize each person as a dot, and draw a connecting line between each of the dots. You'll see that with four people, you'll have six connecting lines. Take it a few steps further and do the math: Seven people equals 21 relationships; 100 people means 4,950 relationships!
Many businesses grow by adding employees, then contract because they fail to grow internal communications systems and procedures. Instead of employees working together as a team to serve their customers, the exponential number of relationships causes internal chaos.
One of the problems with exponential growth of relationships is that it requires managers and leaders with exceptional people skills. But many entrepreneurs make the mistake of hiring team members that have great technical skills but lack equally great people, communication and leadership skills.
A few years ago, I brought on a brilliant attorney who was great at practicing law but absolutely horrible when it came to working with people. It was soon obvious to me that this attorney should only be in a windowless, one-person office and kept far away from contact with any other living creature. It took nearly a year to repair the damage this single brilliant technician did in just four months.
Before adding employees, you must honestly answer the following questions:
How are my/their leadership skills?
How are my/their organizational skills?
How are my/their people skills?
Then it all comes back to the age-old question: "How do you find great people?"
To answer this, I turn to my good friend Donald Trump, who says, "Set the example and you will be a magnet for the right people." That means doing what you say you will do, holding yourself to the highest standards, working to exceed expectations, learning from your mistakes and then sharing those lessons with others.
Robert Kiyosaki(richdad. com), author of the Rich Dad series of books, is an investor, entrepreneur and educator whose perspectives have changed the way people think about money and investing.
Automotive Supply Chain Management: As Good As It Gets?
Many observers agree that the automotive industry is running its supply chain well. They also agree there's room for improvement.
By Larry Gould, Contributing Editor
The best Tier 1 suppliers, come "very, very close to 100% perfect orders," says Scott Lundstrom, chief technology officer, AMR Research (Boston, MA). They score perfect deliveries 98% to 99% of the time. Yet a 90% perfect-order score, unheard of in any other industry AMR surveyed, is considered a "failing grade" in automotive. Moreover, the difference in a supplier's "strong" performance versus another supplier's "weak" performance, as measured by perfect-order fulfillment, is a mere 6%. "That is the equivalent between an A+ and a C-. That's how demanding the automotive environment is." exclaims Lundstrom. "The demand is not so much about being an excellent supply chain company. The demand is about what's next."
Being "perfect"
In technological terms, according to AMR, the better automotive Tier 1 suppliers use more packaged software applications and system. They also use "slightly more" e-business, though Lundstrom admits this is deceiving because "automotive has shared data for many years to a degree that's unprecedented in most other industries."
More important, the major difference between "strong" and "weak"—"best" and "worst"—lies in the supplier's commitment to "best practices." The best suppliers are focused on process excellence. They insert technology where they've already improved processes to minimize costs. "Best practices are things that people do," says Lundstrom (emphasis added). Unfortunately, not everybody quite understands this. Too many suppliers struggling to better their perfect-order performance, continues Lundstrom, have "bought into the notion that somehow they can implement their way into a better supply chain. They can not. Technology helps, but technology does not fix fundamental, underlying business process problems in the supply chain."
So forget about silver-bullet software implementations.
"Best" suppliers are also focused on supplier integration, on what and how data are shared up and down the supply chain. For example, an OEM will fully disclose order information and inventory requirements to a Tier 1 as soon as the OEM knows those requirements. The Tier 1 will then fully disclose that information to its Tier 2 suppliers.
"Automotive is an anomaly. You don't find too many supply chains operating with the same purposefulness and degree of information exchange," says Lundstrom.
Of course, this all comes as a double-edged sword. Technology costs. Perfection has a price. There's a fine balance between retaining customers and destroying profit margins. AMR found that the difference in total supply chain management (SCM) costs between the "best" and "worst" automotive suppliers is half the cost. Expressed as a percent of revenue, 20% of the revenue of a Tier 1 automotive supplier is the difference in SCM costs between the best and worst performers.
Given such "perfection, " what should the automotive industry look for to improve its supply chain? "It's not so much whose supply chain automotive should model, but whose business model automotive should adopt," says Lundstrom. Which leads to a discussion about automotive's physical supply chain. But first, let's address two other automotive supply chains.
The design supply chain
According to Detroit-based CIMdata, the automotive industry has a design (or intellectual property) supply chain. There, says Ken Amann, CIMdata's director of research, the automotive industry is making progress in effective integration. But it still has a ways to go.
OEMs and Tier 1s are aggressively pursuing what CIMdata calls "collaborative product development"— collaborative product design and design chain management, which includes such basic issues as working with suppliers, sharing designs and design activities, and realizing that they're not going to do it all themselves. The larger issue in outsourcing design work is in bringing people together more effectively into the overall environment so that all can be managed more effectively.
Such collaboration is not just a technology issue. It's also an operational issue, which involves cultural, organizational, and ownership issues, says Amann. "The technologies provided by the product lifecycle management suppliers are the enablers that allow these collaborative environments to happen. You can't just put the environment out there and expect it to work." For example, how do OEMs and suppliers handle design review-and-approval processes, as well as security and privacy issues? Guaranteed, now that these processes involve different companies, organizational structures, and people, you can't assume the processes are going to work the way they have in the past.
The customer data supply chain
Another challenge, according to Bob Pethick, lead director for automotive and industrial for Pittiglio Rabin Todd & McGrath's at its Detroit office, is in accessing customer data that's meaningful to help drive the supply chain. To date, most automotive customer data reside in dealer management systems, which "are contracted, bought, and paid for by the dealers themselves," says Pethick. "Dealers have been very protective about their customer data, especially since the OEMs a few years ago announced they were going to try to disintermediate the dealer chain."
The solution here is basically to reengineer the entire OEM-to-dealer systems architecture. The goal is to enable better sharing and, adds Pethick, "to figure out how to create processes and data that will let [both OEMs and dealers] mine and use the data to gain competitive position."
Changing the supply chain model
Now for the big-ticket item ripe for change. The automotive industry runs its supply chain "relatively efficiently, " says Karen Peterson, vice president and research director at Stamford-based Gartner. However, she's quick to point out that "efficiently" does not necessarily equate to "well."
Therein lies the rub. The auto industry is very efficient at mass production, at pushing cars out to be sold. "That efficiency is no longer a competitive advantage. It no longer equates to growth," explains Peterson. Mass production is no longer a "best practice" when the goal is to service customers or, at the very least, to implement some form of mass customization.
Pethick states it another way. The automotive industry operates its supply chain well "given that they are limiting themselves to a very introspective model for supply chains—a ‘push' supply chain as opposed to a ‘pull' supply chain. They're very good at optimizing a suboptimal model."
Worse, notes Peterson, the industry might be "as effective as possible, but it also might be building things people don't want." The industry over builds and offers incentives—discounts and rebates—thereby losing money on each car that never should have built in the first place. "That's not very smart," laughs Peterson.
"The industry is paying customers to take the product at a discount because it's not exactly what the customer wanted," reiterates Pethick. He contrasts this to the build-to-order business: "Customers pay extra for product because they are so enthusiastic about the service."
Moving toward mass customization, though, is "causing huge challenges," says Peterson. The industry "has to change its entire perspective so that the pull signal is coming from the customer rather than from some way arbitrarily determined by the OEM." In short, says Peterson, the automotive industry has to change the whole way it operates its supply chain, including the industry's mindset toward customers. "Sure we're seeing information sharing in the automotive supply chain. It's just not being done to support new change processes," she says. For example, the industry needs to focus on building to, if not "Quantity One," at least to customer requirements. "We might not build to a ‘customer of one,' but let's have a better understanding of what the customers' requirements are and build to those requirements at some level of aggregation. " While today's locate-to-order is "a good step ahead," says Peterson, "it's not the end state."
A better way?
What would be a perfect end state? Think of the design-to-order program at Bob's Store, which lets you design your own chinos and jeans with the help of technology. Customer cost: Forty bucks. (Trawl over to http://www.bobsmade 2order.com/ cgi-bin/bobs. pl. For more details, go to the "tier 1"—Archetype Solutions, Inc. (Emeryville, CA)—at http://www.archetyp e-solutions. com/.) Lands' End has a similar program for chinos. And check out the Nike iD program (http://nikeid. nike.com) . There you can design a logo that Nike will fabricate onto your very own pair of Nike athletic shoes.
("That's the fashion industry," you huff. "Everyone knows that people will pay extra for good-looking, good-fitting clothes." Now think about all the people you know who consider their cars a fashion statement.)
What's a more realistic end state? "Move away from a single-mode mass production model to a more flexible manufacturing supply chain," suggests Pethick. "Maintain the mass production model for high-volume vehicles, but have separate supply chains, even separate types of plants, geared to lower-volume niche markets, niche-product supply chains." Of course, admits Pethick, this will involve reengineering the basic capability and flexibility of the automotive assembly process.
"You have to treat supply chain performance just like you treat manufacturing quality," concludes Lundstrom. "You have to create continuous improvement programs, meaning you have to monitor and manage and adapt yourself on an ongoing basis."
What Makes a "Perfect Order"?
A recent study by AMR Research defines several ways automotive orders can be "imperfect." They can be late, contain poor quality, damaged, or incorrect parts, contain the incorrect quantity, or they can be the correct parts but incorrectly labeled. A perfect order, says Scott Lundstrom, AMR's chief technology officer, "is absolutely exactly what the customer ordered. Right quality, right timing, right delivery.
"Anyone in the automotive industry that isn't [an excellent supplier] is already dead."
By Larry Gould, Contributing Editor
The best Tier 1 suppliers, come "very, very close to 100% perfect orders," says Scott Lundstrom, chief technology officer, AMR Research (Boston, MA). They score perfect deliveries 98% to 99% of the time. Yet a 90% perfect-order score, unheard of in any other industry AMR surveyed, is considered a "failing grade" in automotive. Moreover, the difference in a supplier's "strong" performance versus another supplier's "weak" performance, as measured by perfect-order fulfillment, is a mere 6%. "That is the equivalent between an A+ and a C-. That's how demanding the automotive environment is." exclaims Lundstrom. "The demand is not so much about being an excellent supply chain company. The demand is about what's next."
Being "perfect"
In technological terms, according to AMR, the better automotive Tier 1 suppliers use more packaged software applications and system. They also use "slightly more" e-business, though Lundstrom admits this is deceiving because "automotive has shared data for many years to a degree that's unprecedented in most other industries."
More important, the major difference between "strong" and "weak"—"best" and "worst"—lies in the supplier's commitment to "best practices." The best suppliers are focused on process excellence. They insert technology where they've already improved processes to minimize costs. "Best practices are things that people do," says Lundstrom (emphasis added). Unfortunately, not everybody quite understands this. Too many suppliers struggling to better their perfect-order performance, continues Lundstrom, have "bought into the notion that somehow they can implement their way into a better supply chain. They can not. Technology helps, but technology does not fix fundamental, underlying business process problems in the supply chain."
So forget about silver-bullet software implementations.
"Best" suppliers are also focused on supplier integration, on what and how data are shared up and down the supply chain. For example, an OEM will fully disclose order information and inventory requirements to a Tier 1 as soon as the OEM knows those requirements. The Tier 1 will then fully disclose that information to its Tier 2 suppliers.
"Automotive is an anomaly. You don't find too many supply chains operating with the same purposefulness and degree of information exchange," says Lundstrom.
Of course, this all comes as a double-edged sword. Technology costs. Perfection has a price. There's a fine balance between retaining customers and destroying profit margins. AMR found that the difference in total supply chain management (SCM) costs between the "best" and "worst" automotive suppliers is half the cost. Expressed as a percent of revenue, 20% of the revenue of a Tier 1 automotive supplier is the difference in SCM costs between the best and worst performers.
Given such "perfection, " what should the automotive industry look for to improve its supply chain? "It's not so much whose supply chain automotive should model, but whose business model automotive should adopt," says Lundstrom. Which leads to a discussion about automotive's physical supply chain. But first, let's address two other automotive supply chains.
The design supply chain
According to Detroit-based CIMdata, the automotive industry has a design (or intellectual property) supply chain. There, says Ken Amann, CIMdata's director of research, the automotive industry is making progress in effective integration. But it still has a ways to go.
OEMs and Tier 1s are aggressively pursuing what CIMdata calls "collaborative product development"— collaborative product design and design chain management, which includes such basic issues as working with suppliers, sharing designs and design activities, and realizing that they're not going to do it all themselves. The larger issue in outsourcing design work is in bringing people together more effectively into the overall environment so that all can be managed more effectively.
Such collaboration is not just a technology issue. It's also an operational issue, which involves cultural, organizational, and ownership issues, says Amann. "The technologies provided by the product lifecycle management suppliers are the enablers that allow these collaborative environments to happen. You can't just put the environment out there and expect it to work." For example, how do OEMs and suppliers handle design review-and-approval processes, as well as security and privacy issues? Guaranteed, now that these processes involve different companies, organizational structures, and people, you can't assume the processes are going to work the way they have in the past.
The customer data supply chain
Another challenge, according to Bob Pethick, lead director for automotive and industrial for Pittiglio Rabin Todd & McGrath's at its Detroit office, is in accessing customer data that's meaningful to help drive the supply chain. To date, most automotive customer data reside in dealer management systems, which "are contracted, bought, and paid for by the dealers themselves," says Pethick. "Dealers have been very protective about their customer data, especially since the OEMs a few years ago announced they were going to try to disintermediate the dealer chain."
The solution here is basically to reengineer the entire OEM-to-dealer systems architecture. The goal is to enable better sharing and, adds Pethick, "to figure out how to create processes and data that will let [both OEMs and dealers] mine and use the data to gain competitive position."
Changing the supply chain model
Now for the big-ticket item ripe for change. The automotive industry runs its supply chain "relatively efficiently, " says Karen Peterson, vice president and research director at Stamford-based Gartner. However, she's quick to point out that "efficiently" does not necessarily equate to "well."
Therein lies the rub. The auto industry is very efficient at mass production, at pushing cars out to be sold. "That efficiency is no longer a competitive advantage. It no longer equates to growth," explains Peterson. Mass production is no longer a "best practice" when the goal is to service customers or, at the very least, to implement some form of mass customization.
Pethick states it another way. The automotive industry operates its supply chain well "given that they are limiting themselves to a very introspective model for supply chains—a ‘push' supply chain as opposed to a ‘pull' supply chain. They're very good at optimizing a suboptimal model."
Worse, notes Peterson, the industry might be "as effective as possible, but it also might be building things people don't want." The industry over builds and offers incentives—discounts and rebates—thereby losing money on each car that never should have built in the first place. "That's not very smart," laughs Peterson.
"The industry is paying customers to take the product at a discount because it's not exactly what the customer wanted," reiterates Pethick. He contrasts this to the build-to-order business: "Customers pay extra for product because they are so enthusiastic about the service."
Moving toward mass customization, though, is "causing huge challenges," says Peterson. The industry "has to change its entire perspective so that the pull signal is coming from the customer rather than from some way arbitrarily determined by the OEM." In short, says Peterson, the automotive industry has to change the whole way it operates its supply chain, including the industry's mindset toward customers. "Sure we're seeing information sharing in the automotive supply chain. It's just not being done to support new change processes," she says. For example, the industry needs to focus on building to, if not "Quantity One," at least to customer requirements. "We might not build to a ‘customer of one,' but let's have a better understanding of what the customers' requirements are and build to those requirements at some level of aggregation. " While today's locate-to-order is "a good step ahead," says Peterson, "it's not the end state."
A better way?
What would be a perfect end state? Think of the design-to-order program at Bob's Store, which lets you design your own chinos and jeans with the help of technology. Customer cost: Forty bucks. (Trawl over to http://www.bobsmade 2order.com/ cgi-bin/bobs. pl. For more details, go to the "tier 1"—Archetype Solutions, Inc. (Emeryville, CA)—at http://www.archetyp e-solutions. com/.) Lands' End has a similar program for chinos. And check out the Nike iD program (http://nikeid. nike.com) . There you can design a logo that Nike will fabricate onto your very own pair of Nike athletic shoes.
("That's the fashion industry," you huff. "Everyone knows that people will pay extra for good-looking, good-fitting clothes." Now think about all the people you know who consider their cars a fashion statement.)
What's a more realistic end state? "Move away from a single-mode mass production model to a more flexible manufacturing supply chain," suggests Pethick. "Maintain the mass production model for high-volume vehicles, but have separate supply chains, even separate types of plants, geared to lower-volume niche markets, niche-product supply chains." Of course, admits Pethick, this will involve reengineering the basic capability and flexibility of the automotive assembly process.
"You have to treat supply chain performance just like you treat manufacturing quality," concludes Lundstrom. "You have to create continuous improvement programs, meaning you have to monitor and manage and adapt yourself on an ongoing basis."
What Makes a "Perfect Order"?
A recent study by AMR Research defines several ways automotive orders can be "imperfect." They can be late, contain poor quality, damaged, or incorrect parts, contain the incorrect quantity, or they can be the correct parts but incorrectly labeled. A perfect order, says Scott Lundstrom, AMR's chief technology officer, "is absolutely exactly what the customer ordered. Right quality, right timing, right delivery.
"Anyone in the automotive industry that isn't [an excellent supplier] is already dead."
PPAP Approval
The result of the PPAP process is a series of documents gathered in one specific location (a binder or electronically) called the "PPAP Package". The PPAP package is a series of documents which need a formal approval by the supplier and customer. The form that summarizes this package is called PSW (Part Submission Warrant). The approval of the PSW indicates that the supplier responsible person (usually the Quality Engineer) has reviewed this package and that the customer has not identified any issues that would prevent its approval.
The documentation on the PPAP package is closely related to the Advanced Product Quality Planning process (APQP) used during the design and development of new vehicles and component systems to reduce the risk of unexpected failure due to errors in design and manufacture. The PPAP manual is published by the Automotive Industrial Action Group (AIAG), [www.aiag.org] and specifies generic requirements for obtaining PPAP approvals. Additional customer specific requirements may be imposed by particular clients (vehicle manufacturers) and incorporated in the purchasing contracts. Details of 'customer specific' requirements may be found on the AIAG website http://www.aiag. org or supplier portals provided by the vehicle manufacturers.
Suppliers are required to obtain PPAP approval from the vehicle manufacturers whenever a new or modified component is introduced to production, or the manufacturing process is changed. Obtaining approval requires the supplier to provide sample parts and documentary evidence showing that:
1) The clients requirements have been understood2) The product supplied meets those requirements3) The process (including sub suppliers) is capable of producing conforming product4) The production control plan and quality management system will prevent non-conforming product reaching the client or compromising the safety and reliability of finished vehicles
Production Part Approval Process (PPAP) may be required for all components and materials incorporated in the finished product, and may also be required if components are processed by external sub-contractors.
PPAP Elements
Below is the list of all 18 elements, and a brief description of them.
1. Design Records A copy of the drawing. If the customer is design responsible this is a copy of customer drawing that is sent together with the Purchase Order (PO). If supplier is design responsible this is a released drawing in supplier's release system.
2. Authorized Engineering Change Documents A document that shows the detailed description of the change. Usually this document is called "Engineering Change Notice", but it may be covered by the customer PO or any other engineering authorization.
3. Engineering Approval This approval is usually the Engineering trial with production parts performed at the customer plant. A "temporary deviation" usually is required to send parts to customer before PPAP. Customer may require other "Engineering Approvals".
4. DFMEA A copy of the Design Failure Mode and Effect Analysis (DFMEA), reviewd and signed-off by supplier and customer. If customer is design responsible, usually customer may not share this document with the supplier. However, the list of all critical or high impact product characteristics should be shared with the supplier, so they can be addressed on the PFMEA and Control Plan.
5. Process Flow Diagram A copy of the Process Flow, indicating all steps and sequence in the fabrication process, including incoming components.
6. PFMEA A copy of the Process Failure Mode and Effect Analyis (PFMEA), reviewed and signed-off by supplier and customer. The PFMEA follows the Process Flow steps, and indicate "what could go wrong" during the fabrication and assembly of each component.
7. Control Plan A copy of the Control Plan, reviewed and signed-off by supplier and customer. The Control Plan follows the PFMEA steps, and provides more details on how the "potential issues" are checked in the incoming quality, assembly process or during inspections of finished products.
8. Measurement System Analysis Studies (MSA)) MSA usually contains the Gage R&R for the critical or high impact characteristics, and a confirmation that gauges used to measure these characteristics are calibrated.
9. Dimensional Results A list of every dimension noted on the balloned drawing. This list shows the product characteristic, specification, the measurement results and the assessment showing if this dimension is "ok" or "not ok". Usually a minimum of 6 pieces is reported per product/process combination.
10. Records of Material / Performance Tests A summary of every test performed on the part. This summary is usually on a form of DVP&R (Design Verification Plan and Report), which lists each individual test, when it was performed, the specification, results and the assessment pass/fail. If there is an Engineering Specification, usually it is noted on the print. The DVP&R shall be reviewed and signed off by both customer and supplier engineering groups. The quality engineer will look for a customer signature on this document.
In addition, this section lists all material certifications (steel, plastics, plating, etc), as specified on the print. The material certification shall show compliance to the specific call on the print.
11. Initial Process Studies Usually this section shows all Statistical Process Control charts affecting the most critical characteristics. The intent is to demonstrate that critical processes have stable variability and that is running near the intended nominal value.
12. Qualified Laboratory Documentation Copy of all laboratory certifications (e.g. A2LA, TS) of the laboratories that performed the tests reported on section 10.
13. Appearance Approval Report A copy of the AAI (Appearance Approval Inspection) form signed by the customer. Applicable for components affecting appearance only.
14. Sample Production Parts A sample from the same lot of initial production run. The PPAP package usually shows a picture of the sample and where it is kept (customer or supplier).
15. Master Sample A sample signed off by customer and supplier, that usually is used to train operators on subjective inspections such as visual or for noise.
16. Checking Aids When there are special tools for checking parts, this section shows a picture of the tool and calibration records, including dimensional report of the tool.
17. Customer Specific Requirements Each customer may have specific requirements to be included on the PPAP package. It is a good practice to ask the customer for PPAP expectations before even quoting for a job. North America auto makers OEM (Original Equipment Manufacturer) requirements are listed on http://www.iaob. org website.
18. Part Submission Warrant (PSW) This is the form that summarizes the whole PPAP package. This form shows the reason for submission (design change, annual revalidation, etc) and the level of documents submitted to the customer. There is a section that asks for "results meeting all drawing and specification requirements: yes/no" refers to the whole package. If there is any deviations the supplier should note on the warrant or inform that PPAP cannot be submitted.
The documentation on the PPAP package is closely related to the Advanced Product Quality Planning process (APQP) used during the design and development of new vehicles and component systems to reduce the risk of unexpected failure due to errors in design and manufacture. The PPAP manual is published by the Automotive Industrial Action Group (AIAG), [www.aiag.org] and specifies generic requirements for obtaining PPAP approvals. Additional customer specific requirements may be imposed by particular clients (vehicle manufacturers) and incorporated in the purchasing contracts. Details of 'customer specific' requirements may be found on the AIAG website http://www.aiag. org or supplier portals provided by the vehicle manufacturers.
Suppliers are required to obtain PPAP approval from the vehicle manufacturers whenever a new or modified component is introduced to production, or the manufacturing process is changed. Obtaining approval requires the supplier to provide sample parts and documentary evidence showing that:
1) The clients requirements have been understood2) The product supplied meets those requirements3) The process (including sub suppliers) is capable of producing conforming product4) The production control plan and quality management system will prevent non-conforming product reaching the client or compromising the safety and reliability of finished vehicles
Production Part Approval Process (PPAP) may be required for all components and materials incorporated in the finished product, and may also be required if components are processed by external sub-contractors.
PPAP Elements
Below is the list of all 18 elements, and a brief description of them.
1. Design Records A copy of the drawing. If the customer is design responsible this is a copy of customer drawing that is sent together with the Purchase Order (PO). If supplier is design responsible this is a released drawing in supplier's release system.
2. Authorized Engineering Change Documents A document that shows the detailed description of the change. Usually this document is called "Engineering Change Notice", but it may be covered by the customer PO or any other engineering authorization.
3. Engineering Approval This approval is usually the Engineering trial with production parts performed at the customer plant. A "temporary deviation" usually is required to send parts to customer before PPAP. Customer may require other "Engineering Approvals".
4. DFMEA A copy of the Design Failure Mode and Effect Analysis (DFMEA), reviewd and signed-off by supplier and customer. If customer is design responsible, usually customer may not share this document with the supplier. However, the list of all critical or high impact product characteristics should be shared with the supplier, so they can be addressed on the PFMEA and Control Plan.
5. Process Flow Diagram A copy of the Process Flow, indicating all steps and sequence in the fabrication process, including incoming components.
6. PFMEA A copy of the Process Failure Mode and Effect Analyis (PFMEA), reviewed and signed-off by supplier and customer. The PFMEA follows the Process Flow steps, and indicate "what could go wrong" during the fabrication and assembly of each component.
7. Control Plan A copy of the Control Plan, reviewed and signed-off by supplier and customer. The Control Plan follows the PFMEA steps, and provides more details on how the "potential issues" are checked in the incoming quality, assembly process or during inspections of finished products.
8. Measurement System Analysis Studies (MSA)) MSA usually contains the Gage R&R for the critical or high impact characteristics, and a confirmation that gauges used to measure these characteristics are calibrated.
9. Dimensional Results A list of every dimension noted on the balloned drawing. This list shows the product characteristic, specification, the measurement results and the assessment showing if this dimension is "ok" or "not ok". Usually a minimum of 6 pieces is reported per product/process combination.
10. Records of Material / Performance Tests A summary of every test performed on the part. This summary is usually on a form of DVP&R (Design Verification Plan and Report), which lists each individual test, when it was performed, the specification, results and the assessment pass/fail. If there is an Engineering Specification, usually it is noted on the print. The DVP&R shall be reviewed and signed off by both customer and supplier engineering groups. The quality engineer will look for a customer signature on this document.
In addition, this section lists all material certifications (steel, plastics, plating, etc), as specified on the print. The material certification shall show compliance to the specific call on the print.
11. Initial Process Studies Usually this section shows all Statistical Process Control charts affecting the most critical characteristics. The intent is to demonstrate that critical processes have stable variability and that is running near the intended nominal value.
12. Qualified Laboratory Documentation Copy of all laboratory certifications (e.g. A2LA, TS) of the laboratories that performed the tests reported on section 10.
13. Appearance Approval Report A copy of the AAI (Appearance Approval Inspection) form signed by the customer. Applicable for components affecting appearance only.
14. Sample Production Parts A sample from the same lot of initial production run. The PPAP package usually shows a picture of the sample and where it is kept (customer or supplier).
15. Master Sample A sample signed off by customer and supplier, that usually is used to train operators on subjective inspections such as visual or for noise.
16. Checking Aids When there are special tools for checking parts, this section shows a picture of the tool and calibration records, including dimensional report of the tool.
17. Customer Specific Requirements Each customer may have specific requirements to be included on the PPAP package. It is a good practice to ask the customer for PPAP expectations before even quoting for a job. North America auto makers OEM (Original Equipment Manufacturer) requirements are listed on http://www.iaob. org website.
18. Part Submission Warrant (PSW) This is the form that summarizes the whole PPAP package. This form shows the reason for submission (design change, annual revalidation, etc) and the level of documents submitted to the customer. There is a section that asks for "results meeting all drawing and specification requirements: yes/no" refers to the whole package. If there is any deviations the supplier should note on the warrant or inform that PPAP cannot be submitted.
History of Barcodes
Supermarkets are a perilous business. They must stock thousands of products in scores of brands and sizes to sell at painfully small mark-ups. Keeping close track of them all, and maintaining inventories neither too large nor too small, is critical. Yet for most of the 20th century, as stores got bigger and the plethora on their shelves multiplied, the only way to find out what was on hand was by shutting the place down and counting every can, bag, and parcel. This expensive and cumbersome job was usually done no more than once a month. Store managers had to base most of their decisions on hunches or crude estimates.
Long before bar codes and scanners were actually invented, grocers knew they desperately needed something like them. Punch cards, first developed for the 1890 U.S. Census, seemed to offer some early hope. In 1932 a business student named Wallace Flint wrote a master's thesis in which he envisioned a supermarket where customers would pierce cards to mark their selections. At the checkout counter they would insert them into a reader, which would activate machinery to bring the purchases to them on conveyor belts. Store management would also have a record of what was being bought.
The problem was that the card reading equipment of the day was utterly unwieldy and hopelessly expensive. Even if the country had not been in the middle of the Great Depression, Flint's scheme would have been unrealistic for all but the most distant future. Still, it foreshadowed what was to come.
The first step toward today's bar codes came in 1948, when Bernard Silver, a graduate student, overheard a conversation in the halls of Philadelphia' s Drexel Institute of Technology. The president of a food chain was pleading with one of the deans to undertake research on capturing product information automatically at checkout. The dean turned down the request, but Bob Silver mentioned the conversation to his friend Norman Joseph Woodland, a twenty seven year old graduate student and teacher at Drexel. The problem fascinated Woodland.
His first idea was to use patterns of ink that would glow under ultraviolet light, and the two men built a device to test the concept. It worked, but they encountered problems ranging from ink instability to printing costs. Nonetheless, Woodland was convinced he had a workable idea. He took some stock market earnings, quit Drexel, and moved to his grandfather' s Florida apartment to seek solutions. After several months of work he came up with the linear bar code, using elements from two established technologies: movie soundtracks and Morse code.
Woodland, now retired, remembers that after starting with Morse code, “I just extended the dots and dashes downwards and made narrow lines and wide lines out of them.” To read the data, he made use of Lee de Forest's movie sound system from the 1920's. De Forest had printed a pattern with varying degrees of transparency on the edge of the film, then shined a light through it as the picture ran. A sensitive tube on the other side translated the shifts in brightness into electric waveforms, which were in turn converted to sound by loudspeakers. Woodland planned to adapt this system by reflecting light off his wide and narrow lines and using a similar tube to interpret the results.
Woodland took his idea back to Drexel, where he began putting together a patent application. He decided to replace his wide and narrow vertical lines with concentric circles, so that they could be scanned from any direction. This became known as the “bull's eye code”. Meanwhile, Silver investigated what form the codes should ultimately take. The two filed a patent application on October 20, 1949.
In 1951 Woodland got a job at IBM, where he hoped his scheme would flourish. The following year he and Silver set out to build the first actual bar code reader in the living room of Woodlands house in Binghamton, New York. The device was the size of a desk and had to be wrapped in black oilcloth to keep out ambient light. It relied on two key elements; a five-hundred- watt incandescent bulb as the light source and an RCA 935 photo-multiplier tube, designed for movie sound systems, as the reader.
Woodland hooked the RCA 935 tube up to an oscilloscope. Then he moved a piece of paper marked with lines across a thin beam emanating from the light source. The reflected beam was aimed at the tube. At one point the heat from the powerful bulb set the paper smouldering. None the less, Woodland got what he wanted. As the paper moved, the signal on the oscilloscope jumped. He and Silver had created a device that could electronically read printed material.
It was not immediately clear how to transform this crude electronic response into a useful form. The primitive computers of the day were cumbersome to operate, could only perform simple calculations, and in any case were the size of a typical frozen food section. The idea of installing thousands of them in supermarkets from coast to coast would have been pure fantasy. Yet without a cheap and convenient way to record data from Woodland’s and Silver’s codes, their idea would be no more than a curiosity.
Then there was that five-hundred- watt bulb. It created an enormous amount of light, only a tiny fraction of which was read by the RCA 935 tube. The rest was released as expensive, uncomfortable waste heat. “That bulb was an awful thing to look at”, Woodland recalls. “It could cause eye damage.” The inventors needed a source that could focus a large amount of light into a small space. Today that sounds like a prescription for a laser, but in 1952 Lasers did not exist. In retrospect, hex codes were clearly a technology whose time had nowhere near come.
But Woodland and Silver, sensing the potential pressed on. In October 1952 their patent was granted. Woodland stayed with IBM and in the late 1950s persuaded the company to hire a consultant to evaluate bar codes. The consultant agreed that they had great possibilities but said they would require technology that lay at least five years off. By now almost half the seventeen-year life of Woodland’s and Silver’s patent had expired.
IBM offered a couple of times to buy the patent, but for much less than the inventors thought it was worth. In 1962 Philco met their price, and they sold. (The following year Silver died at age thirty- eight.) Philco later sold the patent to RCA. In 1971 RCA would jolt several industries into action; before then, the next advances in information handling would come out of the railroad industry.
Freight cars are nomads, wandering all across the country and often being lent from one line to another. Keeping track of them is one of the most complex tasks the railroad industry faces and in the early 1960s it attracted the attention of David J. Collins. Collins got his masters degree from MlT in 1959 and immediately went to work for the Sylvania Corporation, which was trying to find military applications for a computer it had built. Noting his undergraduate days Collins had worked for the Pennsylvania Railroad and he knew that the railroads needed away to identify cars automatically and then to handle the information gathered. Sylvania’s computer could do the latter. All Collins needed was a means to retrieve the former. Some sort of coded label seemed to be the easiest and cheapest approach.
Strictly speaking the labels Collins came up with were not bar codes. Instead of relying on black bars or rings they used groups of orange and blue stripes made of a reflective material which could be arranged to represent the digits 0 through 9. Each car was given a four-digit number to identify the railroad that owned it and a six-digit number to identify the car itself. When cars went into a yard, readers would flash a beam of coloured light onto the codes and interpret the reflections. The Boston & Maine conducted the first test of the system on its gravel cars in 1961. By 1967 most of the kinks had been worked out and a nation-wide standard for a coding system was adopted. All that remained was for railroads to buy and install the equipment.
Collins foresaw applications for automatic coding far beyond the railroads and in 1967 he pitched the idea to his bosses at Sylvania. “What we'd like to do now is develop the little black-and-white- line equivalent for conveyor control and for everything else that moves”, he remembers. In a classic case of corporate short-sightedness the company refused to fund him. They said, “We don t want to invest further. We’ve got this big market and let's go and make money out of it.” Collins quit and co-founded Computer Identics Corporation.
Sylvania never even saw profits from serving the railroad industry. Carriers started installing scanners in 1970 and the system worked as expected but it was simply too expensive. Although computers had been getting a lot smaller, faster and cheaper they still cost too much to be economical in the quantities required. The recession of the mid-1970s killed the system as a flurry of railroad bankruptcies gutted industry budgets. Sylvania was left with a white elephant.
Meanwhile Computer Identics prospered. Its system used lasers, which in the late 1960s were just becoming affordable. A milli-watt helium-neon laser beam could easily match the job done by Woodland's unwieldy five-hundred- watt bulb. A thin light moving over a bar code would be absorbed by the black stripes and reflected by the white ones, giving scanner sensors a clear on/off signal. Lasers could read bar codes anywhere from three inches to several feet away, and they could sweep back and forth like a searchlight hundreds of times a second, giving the reader many looks at a single code from many different angles. That would prove to be a great help in deciphering scratched or torn labels.
In the spring of 1969 Computer Identics quietly installed its first two systems - probably the first true bar code systems anywhere. One went into a General Motors plant in Pontiac, Michigan, where it was used to monitor the production and distribution of automobile axle units. The other went into a distribution facility run by the General Trading Company in Carlsbad, New Jersey, to help direct shipments to the proper loading-bay doors. At this point the components were still being built by hand: Collins made the enclosures for the scanners by turning a wastebasket upside down and moulding fibreglass around it. Both systems relied on extremely simple bar codes bearing only two digits worth of information. But that was all they needed the Pontiac plant made only eighteen types of axles, and the General Trading facility had fewer than a hundred doors.
Computer Identics's triumph proved the potential for bar codes in industrial settings. But it was the grocery industry that would once again provide the impetus to push the technology forward. In the early 1970s the industry set out to propel to full commercial maturity the technology that Woodland and Silver had dreamed up and Computer Identics had proved feasible.
Already RCA was moving to assist the industry. RCA executives had attended a 1966 grocery industry meeting where bar code development had been urged, and they smelled new business. A special group went to work at an RCA laboratory in Princeton, New Jersey, and the Kroger grocery chain volunteered itself as a guinea pig. Then, in mid-1970, an industry consortium established an ad hoc committee to look into bar codes. The committee set guidelines for barcode development and created a symbol selection subcommittee to help standardise the approach.
This would be the grocery industry's Manhattan Project, and Alan Haberman, who headed the subcommittee as president of First National Stores, recalls proudly, “We showed that it could be done on a massive scale, that co-operation without antitrust implications was possible for the common good, and that business didn't need the government to shove it in the right direction.”
At the heart of the guidelines were a few basic principles. To make life easier for the cashier, not harder, bar codes would have to be readable from almost any angle and at a wide range of distances. Because they would be reproduced by the millions, the labels would have to be cheap and easy to print. And to be affordable, automated checkout systems would have to pay for themselves in two and a half years. This last goal turned out to be quite plausible. A 1970 study by McKinley & Company predicted that the industry would save $150 million a year by adopting the systems.
''It turns out there were massive savings that we called hard savings--out- of-pocket savings in labour and other areas,” Haberman says. “And there were gigantic savings available in the use of the information and the ability to deal with it more easily than we had before, but we never quantified that.” Hard, quantifiable savings were what would draw retailers. These included checking out items at twice the speed of cashiers using traditional equipment, which would mean shorter lines without staff increases.
Still, while early bar code systems would automate the checkout, they would not be useful for monitoring inventory, because at first too few items would come labelled with codes. Savings from using the collected information, instead of simply from cutting labour costs, would have to wait until most items bore codes. After that happened, management at every level would have to transform the way it operated.
In the spring of 1971 RCA demonstrated a bull's eye bar code system at a grocery industry meeting. Visitors got a round piece of tin and if the code on top contained the right number, they won a prize. IBM executives at that meeting noticed the crowds RCA was drawing and worried that they were losing out on a huge potential market. Then Alec Jabionover, a marketing specialist at IBM, remembered that his company had the bar code's inventor on staff. Soon Woodland - whose patent had expired in 1969 - was transferred to IBM's facilities in North Carolina, where he played a prominent role in developing the most popular and important version of the technology: the Universal Product Code (UPC).
RCA continued to push its bull's-eye code. In July 1972 it began an eighteen-month test in a Kroger store in Cincinnati. It turned out that printing problems and scanning difficulties limited the Bull's-eye's usefulness. Printing presses sometimes smear ink in the direction the paper is running. When this happened to bull's-eye symbols, they did not scan properly. With the UPC, on the other hand, any extra ink simply flows out the top or bottom and no information is lost. For a time such exotics as star burst shaped codes and computer-readable optical characters were considered, but eventually the technically elegant IBM-born UPC won the battle to be chosen by the industry. No event in the history of modern logistics was more important. The adoption of the Universal Product Code, on April 3, 1973, transformed bar codes from a technological curiosity into a business juggernaut.
Before the UPC, various systems had begun to come into use around the world in stores, libraries, factories, and the like, each with its own proprietary code. Afterward any bar code on any product could be read and understood in every suitably equipped store in the country. Standardisation made it worth the expense for manufacturers to put the symbol: on their packages and for printers to develop the new types of ink, plates, and other technology to reproduce the code with the exact tolerances it requires. Budgets for the bar-code revolution were on a scale to make the Pentagon blush. Each of the nation's tens of thousands of grocery outlets would have to spend at least $200,000 on new equipment. Chains would have to install new data processing centres and retrain their employees. Manufacturers would potentially spend $200 million a year on the labels. Yet tests showed that the system would pay for itself in a few years. Standardisation of the code meant a standardised system of numbers to go on it. “Before we had bar codes, every company had its own way of designating its products”, Haberman says. “Some used letters, some used numbers, some used both, and a few had no codes at all. When the UPC took over, these companies had to give up their individual methods and register with a new Uniform Code Council (UCC)”.
The code is split into two halves of six digits each. The first one is always zero, except for products like meat and produce that have variable weight, and a few other special items. The next five are the manufacturer’ s code the next five are the product code: and the last is a check digit used to verify that the preceding digits have been scanned properly. Hidden cues in the structure of the code tell the scanner which end is which, so it can be scanned in any direction. Manufacturers register with the UCC to get an identifier code for their company, and then register each of their products. Thus each package that passes over a checkout stand has its own unique identification number.
Two technological developments of the 1960s finally made scanners simple and affordable enough. Cheap lasers were one. The other was integrated circuit. When Woodland and Silver first came up with their idea, they would have needed a wall full of switches and relays to handle the information a scanner picked up by a microchip. On June 26, 1974, all the tests were done, all the proposals were complete, all the standards were set, and at a Marsh supermarket in Troy, Ohio, a single pack of chewing gum became the first retail product sold with the help of a scanner. Decades of schemes and billions of dollars in investment now became a practical reality. The use of scanners grew slowly at first. A minimum of 85 percent of all products would have to carry the codes before the system could pay off, and when suppliers reached that level, in the late 1970s, sales of the systems started to take off. In 1978 less than one percent of grocery stores nation-wide had scanners. By mid-1981 the figure was 10 percent, three years later it was 33 percent, and today more than 60 percent are so equipped.
Meanwhile, the technology has been creeping into other industries and organisations. Researchers have mounted tiny bar codes on bees to track the insects' mating habits. The U.S. Army uses two-foot-long bar codes to label fifty-foot boats in storage at West Point. Hospital patients wear bar-code ID bracelets. The codes appear on truck parts, business documents, shipping cartons, marathon runners, and even logs in lumberyards. Federal Express, the package shipping giant, is probably the world's biggest single user of the technology: Its shipping labels bear a code called Codabar. Along the way refinements of the basic UPC have been developed, including the European Article Numbering system (EAN), developed by Joe Woodland, which has an extra pair of digits and is on its way to becoming the world's most widely used system. Other codes, which are given such fanciful names as Code 39, Code 16K, and Interleaved 2 of 5, can sometimes contain letters as well as numbers.
Woodland never got rich from bar codes, though he was awarded the 1992 National Medal of Technology by President Bush. But all those involved in the early days speak of the rewards of having brought a new way of doing business to the world. “This thing is a success story on the American way of doing things,” Haberman says. “Our own initiative, take it on ourselves, inviting the world to join in. It has something to say about little guys with lots of vision”.
By Tony Seideman -- This article appeared in Ame
Long before bar codes and scanners were actually invented, grocers knew they desperately needed something like them. Punch cards, first developed for the 1890 U.S. Census, seemed to offer some early hope. In 1932 a business student named Wallace Flint wrote a master's thesis in which he envisioned a supermarket where customers would pierce cards to mark their selections. At the checkout counter they would insert them into a reader, which would activate machinery to bring the purchases to them on conveyor belts. Store management would also have a record of what was being bought.
The problem was that the card reading equipment of the day was utterly unwieldy and hopelessly expensive. Even if the country had not been in the middle of the Great Depression, Flint's scheme would have been unrealistic for all but the most distant future. Still, it foreshadowed what was to come.
The first step toward today's bar codes came in 1948, when Bernard Silver, a graduate student, overheard a conversation in the halls of Philadelphia' s Drexel Institute of Technology. The president of a food chain was pleading with one of the deans to undertake research on capturing product information automatically at checkout. The dean turned down the request, but Bob Silver mentioned the conversation to his friend Norman Joseph Woodland, a twenty seven year old graduate student and teacher at Drexel. The problem fascinated Woodland.
His first idea was to use patterns of ink that would glow under ultraviolet light, and the two men built a device to test the concept. It worked, but they encountered problems ranging from ink instability to printing costs. Nonetheless, Woodland was convinced he had a workable idea. He took some stock market earnings, quit Drexel, and moved to his grandfather' s Florida apartment to seek solutions. After several months of work he came up with the linear bar code, using elements from two established technologies: movie soundtracks and Morse code.
Woodland, now retired, remembers that after starting with Morse code, “I just extended the dots and dashes downwards and made narrow lines and wide lines out of them.” To read the data, he made use of Lee de Forest's movie sound system from the 1920's. De Forest had printed a pattern with varying degrees of transparency on the edge of the film, then shined a light through it as the picture ran. A sensitive tube on the other side translated the shifts in brightness into electric waveforms, which were in turn converted to sound by loudspeakers. Woodland planned to adapt this system by reflecting light off his wide and narrow lines and using a similar tube to interpret the results.
Woodland took his idea back to Drexel, where he began putting together a patent application. He decided to replace his wide and narrow vertical lines with concentric circles, so that they could be scanned from any direction. This became known as the “bull's eye code”. Meanwhile, Silver investigated what form the codes should ultimately take. The two filed a patent application on October 20, 1949.
In 1951 Woodland got a job at IBM, where he hoped his scheme would flourish. The following year he and Silver set out to build the first actual bar code reader in the living room of Woodlands house in Binghamton, New York. The device was the size of a desk and had to be wrapped in black oilcloth to keep out ambient light. It relied on two key elements; a five-hundred- watt incandescent bulb as the light source and an RCA 935 photo-multiplier tube, designed for movie sound systems, as the reader.
Woodland hooked the RCA 935 tube up to an oscilloscope. Then he moved a piece of paper marked with lines across a thin beam emanating from the light source. The reflected beam was aimed at the tube. At one point the heat from the powerful bulb set the paper smouldering. None the less, Woodland got what he wanted. As the paper moved, the signal on the oscilloscope jumped. He and Silver had created a device that could electronically read printed material.
It was not immediately clear how to transform this crude electronic response into a useful form. The primitive computers of the day were cumbersome to operate, could only perform simple calculations, and in any case were the size of a typical frozen food section. The idea of installing thousands of them in supermarkets from coast to coast would have been pure fantasy. Yet without a cheap and convenient way to record data from Woodland’s and Silver’s codes, their idea would be no more than a curiosity.
Then there was that five-hundred- watt bulb. It created an enormous amount of light, only a tiny fraction of which was read by the RCA 935 tube. The rest was released as expensive, uncomfortable waste heat. “That bulb was an awful thing to look at”, Woodland recalls. “It could cause eye damage.” The inventors needed a source that could focus a large amount of light into a small space. Today that sounds like a prescription for a laser, but in 1952 Lasers did not exist. In retrospect, hex codes were clearly a technology whose time had nowhere near come.
But Woodland and Silver, sensing the potential pressed on. In October 1952 their patent was granted. Woodland stayed with IBM and in the late 1950s persuaded the company to hire a consultant to evaluate bar codes. The consultant agreed that they had great possibilities but said they would require technology that lay at least five years off. By now almost half the seventeen-year life of Woodland’s and Silver’s patent had expired.
IBM offered a couple of times to buy the patent, but for much less than the inventors thought it was worth. In 1962 Philco met their price, and they sold. (The following year Silver died at age thirty- eight.) Philco later sold the patent to RCA. In 1971 RCA would jolt several industries into action; before then, the next advances in information handling would come out of the railroad industry.
Freight cars are nomads, wandering all across the country and often being lent from one line to another. Keeping track of them is one of the most complex tasks the railroad industry faces and in the early 1960s it attracted the attention of David J. Collins. Collins got his masters degree from MlT in 1959 and immediately went to work for the Sylvania Corporation, which was trying to find military applications for a computer it had built. Noting his undergraduate days Collins had worked for the Pennsylvania Railroad and he knew that the railroads needed away to identify cars automatically and then to handle the information gathered. Sylvania’s computer could do the latter. All Collins needed was a means to retrieve the former. Some sort of coded label seemed to be the easiest and cheapest approach.
Strictly speaking the labels Collins came up with were not bar codes. Instead of relying on black bars or rings they used groups of orange and blue stripes made of a reflective material which could be arranged to represent the digits 0 through 9. Each car was given a four-digit number to identify the railroad that owned it and a six-digit number to identify the car itself. When cars went into a yard, readers would flash a beam of coloured light onto the codes and interpret the reflections. The Boston & Maine conducted the first test of the system on its gravel cars in 1961. By 1967 most of the kinks had been worked out and a nation-wide standard for a coding system was adopted. All that remained was for railroads to buy and install the equipment.
Collins foresaw applications for automatic coding far beyond the railroads and in 1967 he pitched the idea to his bosses at Sylvania. “What we'd like to do now is develop the little black-and-white- line equivalent for conveyor control and for everything else that moves”, he remembers. In a classic case of corporate short-sightedness the company refused to fund him. They said, “We don t want to invest further. We’ve got this big market and let's go and make money out of it.” Collins quit and co-founded Computer Identics Corporation.
Sylvania never even saw profits from serving the railroad industry. Carriers started installing scanners in 1970 and the system worked as expected but it was simply too expensive. Although computers had been getting a lot smaller, faster and cheaper they still cost too much to be economical in the quantities required. The recession of the mid-1970s killed the system as a flurry of railroad bankruptcies gutted industry budgets. Sylvania was left with a white elephant.
Meanwhile Computer Identics prospered. Its system used lasers, which in the late 1960s were just becoming affordable. A milli-watt helium-neon laser beam could easily match the job done by Woodland's unwieldy five-hundred- watt bulb. A thin light moving over a bar code would be absorbed by the black stripes and reflected by the white ones, giving scanner sensors a clear on/off signal. Lasers could read bar codes anywhere from three inches to several feet away, and they could sweep back and forth like a searchlight hundreds of times a second, giving the reader many looks at a single code from many different angles. That would prove to be a great help in deciphering scratched or torn labels.
In the spring of 1969 Computer Identics quietly installed its first two systems - probably the first true bar code systems anywhere. One went into a General Motors plant in Pontiac, Michigan, where it was used to monitor the production and distribution of automobile axle units. The other went into a distribution facility run by the General Trading Company in Carlsbad, New Jersey, to help direct shipments to the proper loading-bay doors. At this point the components were still being built by hand: Collins made the enclosures for the scanners by turning a wastebasket upside down and moulding fibreglass around it. Both systems relied on extremely simple bar codes bearing only two digits worth of information. But that was all they needed the Pontiac plant made only eighteen types of axles, and the General Trading facility had fewer than a hundred doors.
Computer Identics's triumph proved the potential for bar codes in industrial settings. But it was the grocery industry that would once again provide the impetus to push the technology forward. In the early 1970s the industry set out to propel to full commercial maturity the technology that Woodland and Silver had dreamed up and Computer Identics had proved feasible.
Already RCA was moving to assist the industry. RCA executives had attended a 1966 grocery industry meeting where bar code development had been urged, and they smelled new business. A special group went to work at an RCA laboratory in Princeton, New Jersey, and the Kroger grocery chain volunteered itself as a guinea pig. Then, in mid-1970, an industry consortium established an ad hoc committee to look into bar codes. The committee set guidelines for barcode development and created a symbol selection subcommittee to help standardise the approach.
This would be the grocery industry's Manhattan Project, and Alan Haberman, who headed the subcommittee as president of First National Stores, recalls proudly, “We showed that it could be done on a massive scale, that co-operation without antitrust implications was possible for the common good, and that business didn't need the government to shove it in the right direction.”
At the heart of the guidelines were a few basic principles. To make life easier for the cashier, not harder, bar codes would have to be readable from almost any angle and at a wide range of distances. Because they would be reproduced by the millions, the labels would have to be cheap and easy to print. And to be affordable, automated checkout systems would have to pay for themselves in two and a half years. This last goal turned out to be quite plausible. A 1970 study by McKinley & Company predicted that the industry would save $150 million a year by adopting the systems.
''It turns out there were massive savings that we called hard savings--out- of-pocket savings in labour and other areas,” Haberman says. “And there were gigantic savings available in the use of the information and the ability to deal with it more easily than we had before, but we never quantified that.” Hard, quantifiable savings were what would draw retailers. These included checking out items at twice the speed of cashiers using traditional equipment, which would mean shorter lines without staff increases.
Still, while early bar code systems would automate the checkout, they would not be useful for monitoring inventory, because at first too few items would come labelled with codes. Savings from using the collected information, instead of simply from cutting labour costs, would have to wait until most items bore codes. After that happened, management at every level would have to transform the way it operated.
In the spring of 1971 RCA demonstrated a bull's eye bar code system at a grocery industry meeting. Visitors got a round piece of tin and if the code on top contained the right number, they won a prize. IBM executives at that meeting noticed the crowds RCA was drawing and worried that they were losing out on a huge potential market. Then Alec Jabionover, a marketing specialist at IBM, remembered that his company had the bar code's inventor on staff. Soon Woodland - whose patent had expired in 1969 - was transferred to IBM's facilities in North Carolina, where he played a prominent role in developing the most popular and important version of the technology: the Universal Product Code (UPC).
RCA continued to push its bull's-eye code. In July 1972 it began an eighteen-month test in a Kroger store in Cincinnati. It turned out that printing problems and scanning difficulties limited the Bull's-eye's usefulness. Printing presses sometimes smear ink in the direction the paper is running. When this happened to bull's-eye symbols, they did not scan properly. With the UPC, on the other hand, any extra ink simply flows out the top or bottom and no information is lost. For a time such exotics as star burst shaped codes and computer-readable optical characters were considered, but eventually the technically elegant IBM-born UPC won the battle to be chosen by the industry. No event in the history of modern logistics was more important. The adoption of the Universal Product Code, on April 3, 1973, transformed bar codes from a technological curiosity into a business juggernaut.
Before the UPC, various systems had begun to come into use around the world in stores, libraries, factories, and the like, each with its own proprietary code. Afterward any bar code on any product could be read and understood in every suitably equipped store in the country. Standardisation made it worth the expense for manufacturers to put the symbol: on their packages and for printers to develop the new types of ink, plates, and other technology to reproduce the code with the exact tolerances it requires. Budgets for the bar-code revolution were on a scale to make the Pentagon blush. Each of the nation's tens of thousands of grocery outlets would have to spend at least $200,000 on new equipment. Chains would have to install new data processing centres and retrain their employees. Manufacturers would potentially spend $200 million a year on the labels. Yet tests showed that the system would pay for itself in a few years. Standardisation of the code meant a standardised system of numbers to go on it. “Before we had bar codes, every company had its own way of designating its products”, Haberman says. “Some used letters, some used numbers, some used both, and a few had no codes at all. When the UPC took over, these companies had to give up their individual methods and register with a new Uniform Code Council (UCC)”.
The code is split into two halves of six digits each. The first one is always zero, except for products like meat and produce that have variable weight, and a few other special items. The next five are the manufacturer’ s code the next five are the product code: and the last is a check digit used to verify that the preceding digits have been scanned properly. Hidden cues in the structure of the code tell the scanner which end is which, so it can be scanned in any direction. Manufacturers register with the UCC to get an identifier code for their company, and then register each of their products. Thus each package that passes over a checkout stand has its own unique identification number.
Two technological developments of the 1960s finally made scanners simple and affordable enough. Cheap lasers were one. The other was integrated circuit. When Woodland and Silver first came up with their idea, they would have needed a wall full of switches and relays to handle the information a scanner picked up by a microchip. On June 26, 1974, all the tests were done, all the proposals were complete, all the standards were set, and at a Marsh supermarket in Troy, Ohio, a single pack of chewing gum became the first retail product sold with the help of a scanner. Decades of schemes and billions of dollars in investment now became a practical reality. The use of scanners grew slowly at first. A minimum of 85 percent of all products would have to carry the codes before the system could pay off, and when suppliers reached that level, in the late 1970s, sales of the systems started to take off. In 1978 less than one percent of grocery stores nation-wide had scanners. By mid-1981 the figure was 10 percent, three years later it was 33 percent, and today more than 60 percent are so equipped.
Meanwhile, the technology has been creeping into other industries and organisations. Researchers have mounted tiny bar codes on bees to track the insects' mating habits. The U.S. Army uses two-foot-long bar codes to label fifty-foot boats in storage at West Point. Hospital patients wear bar-code ID bracelets. The codes appear on truck parts, business documents, shipping cartons, marathon runners, and even logs in lumberyards. Federal Express, the package shipping giant, is probably the world's biggest single user of the technology: Its shipping labels bear a code called Codabar. Along the way refinements of the basic UPC have been developed, including the European Article Numbering system (EAN), developed by Joe Woodland, which has an extra pair of digits and is on its way to becoming the world's most widely used system. Other codes, which are given such fanciful names as Code 39, Code 16K, and Interleaved 2 of 5, can sometimes contain letters as well as numbers.
Woodland never got rich from bar codes, though he was awarded the 1992 National Medal of Technology by President Bush. But all those involved in the early days speak of the rewards of having brought a new way of doing business to the world. “This thing is a success story on the American way of doing things,” Haberman says. “Our own initiative, take it on ourselves, inviting the world to join in. It has something to say about little guys with lots of vision”.
By Tony Seideman -- This article appeared in Ame
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