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??
What do you think? Please scroll down (or click) to post a comment. Or please share the post with your thoughts on LinkedIn.
Don't want to miss a post or podcast? Subscribe to get notified about posts via email daily or weekly.
Mark's new book is The Mistakes That Make Us: Cultivating a Culture of Learning and Innovation.
He is also the author of Measures of Success: React Less, Lead Better, Improve More, the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, and the anthology Practicing Lean.
Mark is also a Senior Advisor to the technology company KaiNexus.
Will he replace his daughter with a cheaper one from India??