I posted last year about an Industry Week article about a company called Esselte.
It sounded like a nice success story, a case where they were offsetting lower market prices (that their customers were willing to pay) with lower internal costs. It sounded like they were doing it through lean methods.
But now, a year later, I got a comment from a disgruntled sounding observer:
“Esselte does not raise price's because they get rid of long term employee's and hire Manpower workers instead. The long term worker's that are left had their pay cut drastic. A lot of Manpower worker's are making more than they are! Management's attitude is they couldn't care less about all the year's you have spent working for the company.”
OUCH. That's not lean at all.
Esselte said, last year, something different. They didn't credit lower employee wages:
“With Esselte's previous lean work, combined with Brooks' plan, he says pricing hasn't been an issue so far, noting that he hopes to be able to mitigate more of the material costs with increased efficiencies.
We've organized ourselves, we're building things through a one-piece flow, we're using pull systems within our factory to our suppliers. We've freed up capacity in people and space, we've reduced our inventory in the factory and from our suppliers so WIP is down and the raw material is down, so we're freeing up a lot so space and freeing up capacity.”
So it makes you wonder. Which is true? Both? Neither?
It *is* quite possible that the company is eliminating waste (through 5S and one-piece flow) while ALSO not respecting employees (getting rid of them for cheaper temps). The two pillars of TPS: 1) elimination of waste and 2) respect for people. It's sometimes hard for companies to copy both. Sometimes, they just copy “elimination of waste.” That's not the best long-term lean approach, doing that.
You have to value and respect people, because that's where kaizen and continuous improvement ideas come from.
What do you see out there in the lean world? Are companies struggling with “respect for people?”
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