The Goal Page 8

  "And the last measurement?" I ask.

  "Operational expense," he says. "Operational expense is all the money the system spends in order to turn inventory into throughput."

  "Okay," I say as I write. "But what about the labor invested in inventory? You make it sound as though labor is operational expense?"

  "Judge it according to the definitions," he says.

  "But the value added to the product by direct labor has to be a part of inventory, doesn't it?"

  "It might be, but it doesn't have to be," he says.

  "Why do you say that?"

  "Very simply, I decided to define it this way because I believe it's better not to take the value added into account," he says. "It eliminates the confusion over whether a dollar spent is an invest- ment or an expense. That's why I defined inventory and opera- tional expense the way I just gave you."

  "Oh," I say. "Okay. But how do I relate these measurements to my plant?"

  "Everything you manage in your plant is covered by those measurements," he says.

  "Everything?" I say. I don't quite believe him. "But going back to our original conversation, how do I use these measure- ments to evaluate productivity?"

  "Well, obviously you have to express the goal in terms of the measurements," he says, adding, "Hold on a second, Alex." Then I hear him tell someone, "I'll be there in a minute."

  "So how do I express the goal?" I ask, anxious to keep the conversation going.

  "Alex, I really have to run. And I know you are smart enough to figure it out on your own; all you have to do is think about it," he says. "Just remember we are always talking about the organization as a whole-not about the manufacturing de- partment, or about one plant, or about one department within the plant. We are not concerned with local optimums."

  "Local optimums?" I repeat.

  Jonah sighs. "I'll have to explain it to you some other time."

  "But, Jonah, this isn't enough," I say. "Even if I can define

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  the goal with these measurements, how do I go about deriving operational rules for running my plant?"

  "Give me a phone number where you can be reached," he says.

  I give him my office number.

  "Okay, Alex, I really do have to go now," he says.

  "Right," I say. "Thanks for-"

  I hear the click from far away.

  "- talking to me."

  I sit there on the steps for some time staring at the three definitions. At some point, I close my eyes. When I open them again, I see beams of sunlight below me on the living room rug. I haul myself upstairs to my old room and the bed I had when I was a kid. I sleep the rest of the morning with my torso and limbs painstakingly arranged around the lumps in the mattress.

  Five hours later, I wake up feeling like a waffle.

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  9

  It's eleven o'clock when I wake up. Startled by what time it is, I fall onto my feet and head for the phone to call Fran, so she can let everyone know I haven't gone AWOL.

  "Mr. Rogo's office," Fran answers.

  "Hi, it's me," I say.

  "Well, hello stranger," she says. "We were just about ready to start checking the hospitals for you. Think you'll make it in to- day?"

  "Uh, yeah, I just had something unexpected come up with my mother, kind of an emergency," I say.

  "Oh, well, I hope everything's all right."

  "Yeah, it's, ah, taken care of now. More or less. Anything going on that I should know about?"

  "Well... let's see," she says, checking (I suppose) my mes- sage slips. "Two of the testing machines in G-aisle are down, and Bob Donovan wants to know if we can ship without testing."

  "Tell him absolutely not," I say.

  "Okay," says Fran. "And somebody from marketing is calling about a late shipment."

  My eyes roll over.

  "And there was a fist fight last night on second shift... Lou still needs to talk to you about some numbers for Bill Peach... a reporter called this morning asking when the plant was going to close; I told him he'd have to talk to you... and a woman from corporate communications called about shooting a video tape here about productivity and robots with Mr. Granby," says Fran.

  "With G ranby ?"

  "That's what she said," says Fran.

  "What's the name and number?"

  She reads it to me.

  "Okay, thanks. See you later," I tell Fran.

  I call the woman at corporate right away. I can hardly believe the chairman of the board is going to come to the plant. There

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  must be some mistake. I mean, by the time Granby's limo pulls up to the gate, the whole plant might be closed.

  But the woman confirms it; they want to shoot Granby here sometime in the middle of next month.

  "We need a robot as a suitable background for Mr. Granby's remarks," says the woman.

  "So why did you pick Bearington?" I ask her.

  "The director saw a slide of one of yours and he likes the color. He thinks Mr. Granby will look good standing in front of it," she says.

  "Oh, I see," I tell her. "Have you talked to Bill Peach about this?"

  "No, I didn't think there was any need for that," she says. "Why? Is there a problem?"

  "You might want to run this past Bill in case he has any other suggestions," I tell her. "But it's up to you. Just let me know when you have an exact date so I can notify the union and have the area cleaned up."

  "Fine. I'll be in touch," she says.

  I hang up and sit there on the steps muttering, "So... he likes the color."

  "What was that all about on the phone just now?" my mother asks. We're sitting together at the table. She's obliged me to have something to eat before I leave.

  I tell her about Granby coming.

  "Well that sounds like a feather in your cap, the head man- what's his name again?" asks my mother.

  "Granby."

  "Here he's coming all the way to your factory to see you," she says. "It must be an honor."

  "Yeah, it is in a way," I tell her. "But actually he's just coming to have his picture taken with one of my robots."

  My mother's eyes blink.

  "Robots? Like from out-of-space?" she asks.

  "No, not from outer space. These are industrial robots. They're not like the ones on television."

  "Oh." Her eyes blink again. "Do they have faces?"

  "No, not yet. They mostly have arms... which do things like welding, stacking materials, spray painting, and so on.

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  They're run by computer and you can program them to do dif- ferent jobs," I explain.

  Mom nods, still trying to picture what these robots are.

  "So why's this Granby guy want to have his picture taken with a bunch of robots who don't even have faces?" she asks.

  "I guess because they're the latest thing, and he wants to tell everybody in the corporation that we ought to be using more of them so that-"

  I stop and glance away for a second, and see Jonah sitting there smoking his cigar.

  "So that what?" asks my mother.

  "Uh... so that we can increase productivity," I mumble, waving my hand in the air.

  And Jonah says, have they really increased productivity at our plant? Sure they have, I say. We had-what?-a thirty-six percent improvement in one area. Jonah puffs his cigar.

  "Is something the matter?" my mother asks.

  "I just remembered something, that's all."

  "What? Something bad?" she asks.

  "No, an earlier conversation I had with the man I talked to last night," I say.

  My mother puts her hand on my shoulder. "Alex, what's wrong?" she's asking. "Come on, you can tell me. I know something's wrong. You show up out of the blue on my doorstep, you're calling people all over the place in the mid- dle of the night. What is it?"

  "See, Mom, the plant isn't doing so well... and, ah... well, we're not making any money." My mother's brow darkens.

  "Yo
ur big plant not making any money?" she asks. "But you're telling me about this fancy guy Granby coming, and these robot things, whatever they are. And you're not making any money?"

  "That's what I said, Mom." "Don't these robot things work?" "Mom-"

  "If they don't work, maybe the store will take them back."

  "Mom, will you forget about the robots!"

  She shrugs. "I was just trying to help."

  I reach over and pat her hand.

  "Yes, I know you were," I say. "Thanks. Really, thanks for

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  everything. Okay? I've got to get going now. I've really got a lot of work to do."

  I stand up and go to get my briefcase. My mother follows. Did I get enough to eat? Would I like a snack to take with me for later in the day? Finally, she takes my sleeve and holds me in one place.

  "Listen to me, Al. Maybe you've got some problems. I know you do, but this running all over the place, staying up all night isn't good for you. You've got to stop worrying. It's not going to help you. Look what worrying did to your father," she says. "It killed him."

  "But, Mom, he was run over by a bus."

  "So if he hadn't been so busy worrying he would have looked before he crossed the street."

  I sigh. "Yeah, well, Mom, you may have a point. But it's more complicated than you think."

  "I mean it! No worrying!" she says. "And this Granby fellow, if he's making trouble for you, you let me know. I'll call him and tell him what a worker you are. And who should know better than a mother? You leave him to me. I'll straighten him out."

  I smile. I put my arm around her shoulders.

  "I bet you would, Mom."

  "You know I would."

  I tell Mom to call me as soon as her phone bill arrives in the mail, and I'll come over and pay it. I give her a hug and a kiss good-bye, and I'm out of there. I walk out into the daylight and get into the Mazda. For a moment, I consider going straight to the office. But a glance at the wrinkles in my suit and a rub of the stubble on my chin convinces me to go home and clean up first.

  Once I'm on my way, I keep hearing Jonah's voice saying to me: "So your company is making thirty-six percent more money from your plant just by installing some robots? Incredible." And I remember that I was the one who was smiling. I was the one who thought he didn't understand the realities of manufacturing. Now I feel like an idiot.

  Yes, the goal is to make money. I know that now. And, yes, Jonah, you're right; productivity did not go up thirty-six percent just because we installed some robots. For that matter, did it go up at all? Are we making any more money because of the robots? And the truth is, I don't know. I find myself shaking my head.

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  But I wonder how Jonah knew? He seemed to know right away that productivity hadn't increased. There were those ques- tions he asked.

  One of them, I remember as I'm driving, was whether we had been able to sell any more products as a result of having the robots. Another one was whether we had reduced the number of people on the payroll. Then he had wanted to know if inventories had gone down. Three basic questions.

  When I get home, Julie's car is gone. She's out some place, which is just as well. She's probably furious at me. And I simply do not have time to explain right now.

  After I'm inside, I open my briefcase to make a note of those questions, and I see the list of measurements Jonah gave me last night. From the second I glance at those definitions again, it's obvious. The questions match the measurements.

  That's how Jonah knew. He was using the measurements in the crude form of simple questions to see if his hunch about the robots was correct: did we sell any more products (i.e., did our throughput go up?); did we lay off anybody (did our operational expense go down?); and the last, exactly what he said: did our inventories go down?

  With that observation, it doesn't take me long to see how to express the goal through Jonah's measurements. I'm still a little puzzled by the way he worded the definitions. But aside from that, it's clear that every company would want to have its throughput go up. Every company would also want the other two, inventory and operational expense, to go down, if at all pos- sible. And certainly it's best if they all occur simultaneously-just as with the trio that Lou and I found.

  So the way to express the goal is this?

  Increase throughput while simultaneously reducing both in- ventory and operating expense.

  That means if the robots have made throughput go up and the other two go down, they've made money for the system. But what's really happened since they started working?

  I don't know what effect, if any, they've had on throughput. But off the top of my head, I know inventories have generally increased over the past six or seven months, although I can't say for sure if the robots are to blame. The robots have increased our depreciation, because they're new equipment, but they haven't directly taken away any jobs from the plant; we simply shifted

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  people around. Which means the robots had to increase opera- tional expense.

  Okay, but efficiencies have gone up because of the robots. So maybe that's been our salvation. When efficiencies go up, the cost-per-part has to come down.

  But did the cost really come down? How could the cost-per- part go down if operational expense went up?

  By the time I make it to the plant, it's one o'clock, and I still haven't thought of a satisfactory answer. I'm still thinking about it as I walk through the office doors. The first thing I do is stop by Lou's office.

  "Have you got a couple minutes?" I ask.

  "Are you kidding?" he says. "I've been looking for you all morning."

  He reaches for a pile of paper on the corner of his desk. I know it's got to be the report he has to send up to division.

  "No, I don't want to talk about that right now," I tell him. "I've got something more important on my mind."

  I watch his eyebrows go up.

  "More important than this report for Peach?"

  "Infinitely more important than that," I tell him.

  Lou shakes his head as he leans back in his swivel chair and gestures for me to have a seat.

  "What can I do for you?"

  "After those robots out on the floor came on line, and we got most of the bugs out and all that," I say, "what happened to our sales?"

  Lou's eyebrows come back down again; he's leaning forward and squinting at me over his bifocals.

  "What kind of question is that?" he asks.

  "A smart one, I hope," I say. "I need to know if the robots had any impact on our sales. And specifically if there was any increase after they came on line."

  "Increase? Just about all of our sales have been level or in a downhill slide since last year."

  I'm a little irritated.

  "Well, would you mind just checking?" I ask.

  He holds up his hands in surrender.

  "Not at all. Got all the time in the world."

  Lou turns to his computer, and after looking through some

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  files, starts printing out handfuls of reports, charts, and graphs. We both start leafing through. But we find that in every case where a robot came on line, there was no increase in sales for any product for which they made parts, not even the slightest blip in the curve. For the heck of it, we also check the shipments made from the plant, but there was no increase there either. In fact, the only increase is in overdue shipments-they've grown rapidly over the last nine months.

  Lou looks up at me from the graphs.

  "Al, I don't know what you're trying to prove," he says. "But if you want to broadcast some success story on how the robots are going to save the plant with increased sales, the evidence just doesn't exist. The data practically say the opposite."

  "That's exactly what I was afraid of," I say.

  "What do you mean?"

  "I'll explain it in a minute. Let's look at inventories," I tell him. "I want to find out what happened to our work-in-process on parts produced by the robots."


  Lou gives up.

  "I can't help you there," he says. "I don't have anything on inventories by part number."

  "Okay, let's get Stacey in on this."

  Stacey Potazenik manages inventory control for the plant. Lou makes a call and pulls her out of another meeting.

  Stacey is a woman in her early 40's. She's tall, thin, and brisk in her manner. Her hair is black with strands of gray and she wears big, round glasses. She is always dressed in jackets and skirts; never have I seen her in a blouse with any kind of lace, ribbon or frill. I know almost nothing about her personal life. She wears a ring, but she's never mentioned a husband. She rarely mentions anything about her life outside the plant. I do know she works hard.

  When she comes in to see us, I ask her about work-in-process on those parts passing through the robot areas.

  "Do you want exact numbers?" she asks.

  "No, we just need to know the trends," I say.

  "Well, I can tell you without looking that inventories went up on those parts," Stacey says.

  "Recently?"

  "No, it's been happening since late last summer, around the

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  end of the third quarter," she says . "And you can't blame me for it-even though everyone always does-because I fought it every step of the way."

  "What do you mean?"

  "You remember, don't you? Or maybe you weren't here then. But when the reports came in, we found the robots in weld- ing were only running at something like thirty percent efficiency. And the other robots weren't much better. Nobody would stand for that."

  I look over at Lou.

  "We had to do something," he says. "Frost would have had my head if I hadn't spoken up. Those things were brand new and very expensive. They'd never pay for themselves in the projected time if we kept them at thirty percent."

  "Okay, hold on a minute," I tell him. I turn back to Stacey. "What did you do then?"