True Cost of Lip Service


    If Detroit does not stand on the cusp of really traumatic possible bankruptcies of companies like General Motors and Chrysler, I would be tempted to play I-Told-You-So even more loudly!

    Two years ago, I wrote this blog in a sister blog of this one – The Cost of Lip Service , about the way GM and Chrysler were faring against Toyota and the Japanese Automakers.

    GM and Chrysler had many disadvantages against Toyota and the Japanese Automakers operating in the U.S. The U.S car makers had legacy Healthcare costs that cost them almost $2000 more per car. The Japanese automakers did not have healthcare coverage for retired workers and so they did not have these costs to contend with.

    The U.S Car makers continued making gas guzzlers while the Japanese automakers made smaller gas stingy cars and so when the run up in Petroeleum prices went up to $147 a barrel, GM ansd Chrysler saw huge dips in their sales in just two quarters and now we are here on the cusp of bankruptcies for these companies.

    To a large extent, although not all, the success of the Japanese automakers were due to their Continuous Process Improvement efforts at least in the manufacturing of the cars that helped them drive down the costs of cars manufactured lower and lower while driving up quality at the same time!

    The lesson here is that you cannot compete effectively against your competitor that takes Continuous Process Improvement very seriously and that too for decades at a time, and at a relentless fashion!

    The positive lesson here is that no matter which industry you are in, Continuous Process Improvement is a weapon that cannot be matched by anyone, particularly those who provide it lip service in an on and off fashion!

    All men can see these tactics whereby I conquer, but what none can see is the strategy out of which victory is evolved. – Sun Tzu


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