Why Top Professionals Are So Successful

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As the days grow shorter and cooler, I find myself reflecting on a week I spent in sunny  Florida at an Alan Weiss thought leadership seminar with 30 of the top consultants in the world. Though they work in different fields, they all have the following traits in common. Here’s why they’re so successful…

Value

All of them clearly understand the value they provide their clients. Whether they’re executive coaches, merger and acquisition specialists or operations and supply chain consultants, they all know exactly how they help their clients accelerate profit, growth and personal performance.

Boldness

They take bold measures to market and deliver their value. They’re provocative, innovative, and they challenge their clients’ thinking to help move them to levels of performance they never thought possible.

Action

They’re action oriented. Not only did they know exactly what they’d do back at the office to move their practices forward, but they began taking action before they’d even left Florida. I know because when I ran into them at the airport, they were already writing and scheduling their next steps for the following week.

In every profession, we can always work on improving how we articulate our value, being bold in our communication and delivery, and taking action.

© 2018 – Rick Pay – All Rights Reserved

What Got You Here Won’t Get You There

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This famous saying and book title by Marshall Goldsmith, the consummate management coach, applies to many things in our business lives, not the least of which is supply chain management strategy. I recently received a survey from a marketing company seeking to find out how companies were addressing performance improvement and risk mitigation in their supply chains. As I reviewed the survey, two things jumped out.

  1. Most of the issues were internally focused.
  2. The ideas they proposed as “leading edge” had to do with information, communication, tracking, improving current processes, and collaboration; the same old, same old.

If companies want to move to the next level of performance in their supply chains, they need to think differently as they develop their strategies. Otherwise, they’re trying to out-perform their competitors by doing the same things better. To reach world class, top 10% performance, companies need to think differently. How can they partner (not just collaborate) to improve supply chain performance? How can they become more agile to allow quick, dramatic improvements to take place? How can they leverage speed in everything they do?

Companies don’t need to just think outside the box, they need to do away with the box. Trying to do the same things better won’t get you there. Using the power of partnerships and world class thinking will.

© 2018 – Rick Pay – All Rights Reserved

How to Jump-Start Improvement

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Many companies begin performance improvement initiatives with 5S, a Lean tool that involves workplace organization. 5S reduces clutter in offices, warehouses and manufacturing floors and creates quick, visible improvements to jump start employee engagement in the process.

The best initial workplace organization projects are designed to:

  1. Be highly visible – people need to see what is going on. This builds curiosity and a desire to become involved, so the effort can easily spread throughout the organization.
  2. Ensure success and build support – if you want support for the process, people need to see that it works! Be sure to pick a work location where success is ensured.
  3. Make work life easier – the best projects really make a difference to the people at the point of work by making the process easier and more successful.

Click here to read more about how to get more bang for your improvement buck

 

© 2018 Rick Pay. All rights reserved.

Rick’s Materials Management Manifesto

At my first meeting with many companies, they’re often stressed by trying to deliver 3% to 5% per year cost reductions to their customers. They frequently have inventory turns of four or less, which consumes cash and erodes profitability.

Companies really can achieve dramatic improvement with profit numbers in the 20% of sales range and inventory turns over 12. Rick’s Materials Management Manifesto will challenge your thinking and put you on a path to world-class performance. Click here for an expanded description of all eight points.

 

  1. You can sell out of an empty wagon
  2. Don’t waste your buyer on buying
  3. RFQs increase costs
  4. Annual cost reductions of 3% to 5% are peanuts
  5. Unplug your MRP – it’s likely an ineffective buying tool
  6. Too many suppliers spoil the soup
  7. Manage products throughout their life cycle
  8. Consigned inventory can destroy supplier relationships

 

Supplier partnerships, process discipline and striving to improve flow though Just-In-Time inventory management can provide exponential improvements in profit and cash flow. Use Rick’s Materials Management Manifesto to guide your thinking and achieve world-class performance.

 

© 2017 – Rick Pay – All Rights Reserved

To Do Lean Or To Be Lean?

Being Lean achieves world-class performance. Doing Lean often only results in the deck chairs being reorganized just before the ship sinks.

Many companies spend months (if not years) doing Lean. In too many cases, they don’t achieve the results they set out to obtain, and the Lean effort slowly fades away. In fact, 70% or more of companies fail to get the results they wanted from their Lean initiatives. With the plethora of MEPs, Lean consultants and books available, why is that?

Doing Lean includes the tactical activities of training, implementing tools, shop floor and warehouse improvement projects, Kaizen events, and score keeping. If those activities aren’t driven by your operations strategy and company vision, there’s no alignment with your business objectives, and the ground level activities don’t get results or keep the interest of executives.

Being Lean

Being Lean is a whole different thing: it’s the context within which Lean activities occur. Being Lean provides the strategy for the Lean efforts, which help target activities to produce the greatest and most meaningful results. Being Lean changes the way products are designed, includes partnerships, eliminates superfluous activities, and changes the culture of the company. Being Lean provides breakthrough results.

An example is the implementation of a Kanban system. Kanban is a signal or trigger to do something, often associated with the movement and acquisition of materials. In the doing environment of Lean, safety stock and minimum order quantities are included in the calculation of Kanban size, and should be. But safety stock is a waste, and minimum order quantities optimize supplier performance at the expense of your company’s performance.

If you are doing Lean, once the calculation is set, the system is executed with good results, but safety stock and MOQs continue to impact overall performance. If you are being Lean, efforts to eliminate both of these issues take place, allowing you to achieve breakthrough results including turns over 12, 99.8% service levels, 20% annual materials cost reductions and more.

Wouldn’t you rather be than do?

© 2016 – Rick Pay – All Rights Reserved

Who Owns The Empty Shelves?

Strong process discipline is vital for top performance. By discipline, I’m referring to the tenacity, diligence, and persistence people exhibit in their work.

Let me give you an example. I’ve been working with a retail company whose sales have been trending down for the past 12 to 18 months. There could be several reasons for this, but as I reviewed their operations and observed the activities on the sales floor, I noticed a number of empty spaces on the shelves. Every time I visited the store, I would look in the same spots and I noticed that the same spaces remained empty.

Every process should have an owner, so I asked who owns stock replenishment. Not surprisingly, the stock replenishment process had no specific owner. To make things worse, the people who usually stocked the shelves were busy with other responsibilities, so stock replenishment only got done when it was convenient or in response to a special request to stock a shelf.

If product isn’t readily available, some customers will ask a sales person, but many will simply go down the street to a competitor to find what they need. This was contributing to the decline in sales.

The discipline of process management (and execution) helps achieve top performance. In this case, the added revenue may have reversed the downward trend in sales.

© 2016 – Rick Pay – All Rights Reserved

Strong Processes Help Retention

Most people think of good processes leading to increased profitability, reducing waste, improving service levels and more, but did you ever consider that great processes help attract and keep great people? Strong processes set the boundaries for performance, expectations of execution and standard work, leading to consistent outcomes.

Great process can do even more when it comes to the people involved. Process:

  • Helps on-board new people quickly
  • Creates an organized environment the reduces frustration
  • Helps people feel more valuable and contributory
  • Gives people opportunity for improvement
  • Broadens people’s value to the company

Strong process can create an environment and reputation that attracts and keeps the best people. Great people are an absolute requirement to accelerate profit and growth.

© 2016 – Rick Pay – All Rights Reserved

 

Don’t Be Average

Many companies use benchmarking as a means to drive process and productivity improvement. Most industries publish benchmarking data including financial, productivity, asset, market growth, and other criteria for comparing your company to others of similar revenue or asset value in your industry. The most common measure is industry average.

The problem is, by comparing yourself to others and to industry averages, you’re accepting average as a goal. Shouldn’t we strive to be better than average?

Rather than emulating others, be innovative and adopt a strategy that moves you beyond what others are doing. And don’t just try to be better than average, be way above average. The Risk Management Association (RMA) book is a great source of comparative financial information, and provides not only averages, but also top quartile information. This way you can benchmark yourself against the top performers in your industry.

Are you and your company striving to be average, or to be industry leaders?

© 2015 – Rick Pay – All Rights Reserved

Higher Purpose

Why do so many Lean implementations leave executives with an empty feeling? I’ve spoken to a number of people in various types of organizations over the past few months who’ve been trying to implement Lean, and it hasn’t produced the sustained results they’d hoped for. They’re not alone; according to several surveys, Lean “fails” as much as 70% of the time.

For Lean to provide rich, long-lasting results, it needs to have a higher purpose. That can be growth, profitability, cash flow, innovation, or cultural enhancement. Lean can’t be successful if it’s just another tool to improve productivity. It needs a context or framework: the higher purpose.

Does your company have a higher purpose framework that provides context for Lean and other improvement methods? If not, you may find that in a couple of years your company’s Lean performance is declining. Define your higher purpose first, and then determine which tools and techniques to use to get there.

© 2015 – Rick Pay – All Rights Reserved

How Top Supply Chains Lead The Way

Industry week recently published its list of the 25 top supply chains of 2014. As part of that, it pointed out what those companies are doing to develop their supply chains. The leading practices included:

  • Supply chain network design optimization
  • Use of data analytics
  • Product launch and life cycle management
  • Synchronous business planning
  • Inventory optimization and management of the cash-to-cash cycle
  • Collaboration within the supply chain from customers to suppliers

All of these are vital to successful supply chain management, but world-class performance in those areas helps create amazing competitive advantage. Each of the companies in the top 25 are not only leaders in their industries, but are recognized as innovative, creative and top performing companies world wide.

Are you using these tools and techniques in your supply chains?

© 2014 – Rick Pay – All Rights Reserved