By August 13, 2006 1 Comments Read More →

Bad Habits for the Next Generation

Like Father, Like Daughter – 08/12/06 – The Detroit News Online (scroll down for this item)

Here is a story that made me cringe about GM’s head of purchasing, Bo Andersson:

“Andersson’s cost-cutting zeal has apparently filtered down to his 14-year-old daughter, who went to Saks Fifth Avenue and saw a $120 necklace she wanted to buy with her own money. She checked out the Internet and got ’25 price quotes,’ Andersson said, and eventually bought the necklace online from an outfit in Hawaii. She then took it to Saks to compare and reported that it was identical. ‘It’s scary,’ Andersson said. ‘Now she’s benchmarking everything. She thinks her weekly allowance is too low.'”

Lord, help us and help GM. It’s clear that the Deming idea of “Don’t award business based on price tag alone” isn’t being passed along in his house, yet alone within GM.

Let’s count the ways his daughter could have been ripped off by buying from “some outfit” in Hawaii. It could have been counterfeit, she might not have been able to return it (as she would have with a local Saks), etc. I wonder how much she saved by going to a cheaper, but unknown supplier? At the risk of reading too much into this story, this represents a lot of what’s wrong with GM, Andersson’s “let’s get stuff cheap” mentality.

“Cost cutting zeal” versus real long-term lean performance. They’re not the same thing. Why doesn’t GM learn from Toyota and their long-term relationships with suppliers??

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Mark Graban's passion is creating a better, safer, more cost effective healthcare system for patients and better workplaces for all. Mark is a consultant, author, and speaker in the "Lean healthcare" methodology. He is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as The Executive Guide to Healthcare Kaizen. His most recent project is an eBook titled Practicing Lean that benefits the Louise H. Batz Patient Safety Foundation, where Mark is a board member. Mark is also the VP of Improvement & Innovation Services for the technology company KaiNexus.

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1 Comment on "Bad Habits for the Next Generation"

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  1. Anonymous says:

    Will he replace his daughter with a cheaper one from India??

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