Last week, I described how a company like ours compares to our family or household around the topic of making money. An important part of making money is spending it in the right way so you don’t run out of it and you don’t waste it. So this week, I want to continue with that comparison, but specifically focus on the idea of waste.
As I said in Part 1 of this blog, the reason the company exists is to make money. A healthy company needs to make a profit, and its leaders are charged with balancing the competing demands for all the things we can spend money on in a business. Just like in a company, we have many competing demands on our household budget.
As we manage our family’s spending, we try to reduce waste. Spreading the dollars around to cover all the family expenses is hard – priorities have to be made, and we don’t want to be wasteful with our limited resources. For example, turning down the thermostat in the winter is a common household strategy to not be wasteful with limited resources, like heating oil, propane or electricity. Some of you can probably recall a parent or family member saying, “Who turned up the thermostat? Put on a sweater if you’re cold.” I lived in that house back in Pittsburgh and to this day, I almost always have a light coat or sweatshirt on during the winter. My kids like to laugh at me about it…
When my kids were younger, it would drive me crazy when they lost or broke something, especially an item that we had to go out and buy again. It always seemed to happen when money was tight – and at the same time they needed to sign up for a sports team, needed school clothes or needed a new whatever… It seemed the money never stopped flowing out. If we could just stop having to replace broken or lost things, we would have a little more to save for other things, things that never seemed to make it to the top of the priorities list.
Our company is similar. Wasted resources consume money – just like in your household. Unlike in your household of two, four, six or even ten or more people, our company has more than 6,900 people competing for resources to do their jobs. The concept is the same, just on a larger scale. The company has limited resources – just like you and I do.
In writing Strategy 2024, I set a goal for us to become better stewards of the business by learning about the Seven Wastes and selecting two for us to focus on this year: Defects and Waiting. But eliminating all of the seven types of waste is important.
You and I can affect how our company performs by paying attention to the ways in which we use our company’s resources. First (and easiest to control) is our own personal behavior. Not sure what I mean? Let’s look at a couple of examples.
If I come into work ready to go – actively thinking about how I need to go about my work for the day and prepared to work at my start time – then work efficiently throughout the day, I will move my work product closer to being completed. If I come to work and I’m not ready to start working, have no idea where to begin, or have to do catch-up or rework from the day before – then I am wasting the resource of time.
If I choose to slack off, not give my “8 for 8” (eight hours of work for eight hours of pay) or do substandard work, then I slow down the progress of the product and ultimately hurt the company. If you are working against the company, you are essentially working against yourself (as well as your coworkers who are trying to make the company succeed). Think about why the company exists – if it doesn’t make money, then the company will close. Although you are one person, you can have an effect – positively or negatively. One starts a trend!
The second way you can affect the company is by using the company’s resources properly. In this context, I’m talking about the tools, material, slump items, weld wire and consumable items used in the building process as well as the need to return unused material so someone else can use it. This list is not exhaustive, but it should give you an idea about what I’m referring to. It means being a good steward of the company. Everything you use has a cost.
If each of us focuses on using only what we need to build our ships, we will see costs decrease. Not having to replace wasted resources creates the opportunity to use that money on things like building projects, additional training and development, pay increases and lots of other activities.
When you’re managing your resources effectively at home, it creates a more well-balanced household. It’s very similar at work: when you safely execute high-quality work and effectively manage our resources, you become a good steward of our company.
See you on the deckplates!
Safely Execute High-Quality Work
Chuck
President, General Dynamics Bath Iron Works