Dell Hires Lean Guy From Selectron


ARNnet – Dell hires Solectron CEO, forms operations group

A frequent theme of mine is that Dell should not be lumped into the category of “Toyota Production System” companies even though many people (including some respected lean gurus) call Dell “lean.”

Dell has hired Michael Cannon, most recently the CEO of Solectron, a contract manufacturing company that has won multiple Shingo Prizes, a company that says lean “permeates everything we do.” Cannon will lead a newly created Dell global operations group. I assume he will do more to bring lean thinking to Dell. But what does that mean, exactly?

His job includes the responsibility for opening factories that are closer to customers and improving the company's supply chain, Dell said, noting that plans are underway to add new factories in India, Poland and Brazil.

Dell has spread factories around the world with the goal of building close to their customers. That sounds lean, I suppose, with the goal of reducing cycle times and total supply chain costs. But, Dell has moved in the complete opposite direction from that by pushing any remaining U.S. suppliers abroad and assembling laptops for U.S. customers in Malaysia instead of Austin or Nashville, as they used to do (and this was only final assembly even when they were “Made in the USA.”

Is Dell just talking a good game or really looking to change their tune? Dell does have some people they've hired with Toyota-type backgrounds, but I don't know how much impact that's really had at the factory level, I'm not that close to things anymore.

Does anyone have experience with Solectron and their approach to lean? Do they just focus on lean tools or do they also focus on the people side? The Solectron lean web site talks about Value, Value Chain, Pull, Flow, and Kaizen (Kaizen Events).

Toyota doesn't really use “Kaizen Events.” At Toyota, “kaizen” is more of a daily improvement process that doesn't require week-long events.

I don't see much about quality in Solectron's definition of lean. That pretty much lines up with my first-hand experiences at Dell, when I worked there in 1999 and 2000. Dell was great at flow, inside the factories. But, the flow through the entire value stream wasn't that great and I never liked the way they treated people at the shopfloor level.

I also remember how Dell, circa 1999, only cared about production quantity numbers (as did GM, circa 1995). Dell was better at the flow and production volume game, but quality wasn't the primary focus. All of their end-of-quarter incentives for the PC assemblers were volume, speed, and quantity driven. “You get what you measure,” right? I asked a manager why we didn't have incentives for quality and I was told, dismissively, “well, quality is a given.” Is it? That didn't seem very lean to me. That's why I say Dell isn't a “TPS” company.

Toyota Georgetown's definition of TPS/Lean (they don't use the word “Lean”) does much more to include quality and people to the discussion, not just flow.

Solectron talks about combining Lean and Six Sigma. Toyota doesn't use “Six Sigma” (though they'll use some statistical tools) and certainly doesn't play the “LeanSigma” card at all.

Seems like we have two totally different views here, Toyota's and Solectron's/Dell's. What do you think? Is it a waste of time to think or talk about this?

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  1. Anonymous says

    As Chuck-D of public enemy once said “d-d-don’t believe the hype”

    -anonymous solectron engineer

  2. Anonymous says

    yes, it is a waste of time

  3. JWDT says

    You have to love the LS6 discussion. My 2 cents, waste of time. If you have an effective Standard Work package with Jidoka, why do you need Six Sigma?

  4. robert says

    I recall reading that a key question to ask is “Am I in an agile market or a lean one?”

    Lean markets are stable and cost is the primary driver. Agile markets are unstable with technology changing rapidly, eg Dell.

    I would argue it agility not lean that Dell should be promoting.

    Rob (lean) (six sigma)

  5. Anonymous says

    Rob, i’d have to disagree. In what frame of reference do you require “Agile”?

    If you take a “lean” mentality then building units in lots of 1 is the glorious ideal (to brutally paraphrase)

    How therefore does ‘agility’ affect this? The rapid change in technology is not that rapid when it comes to DELL. A computer has a very limited number of variable components which of course have a wide range of types but they are each of a very similar form factor. A lean material supply chain would be paramount here to ensure that you do not have large stocks of any product which may become obsolete. That’s about the only place i could consider ‘agility’ to be required.

    In general i consider it false to talk about “lean markets”. That would be you purely applying ‘lean’ to your manufacturing process, but there are so many other areas of work that you can improve – ie the material supply chain again.

    Sorry if it rambles, writing this in a very small window.

    -anon solectron engineer.

  6. Mark Graban says

    Robert, I don’t understand “lean” vs. “agile.” It’s frustrating that, in the lean world, we have to constantly ask “how do you define that?” We have too many definitions of lean.

    By “lean,” I consider that to be 1) eliminating waste and 2) respect for people. To me, lean IS agile. How can you say Dell shouldn’t be reducing waste or driving continuous improvement?

  7. Joe says

    In the middle of this debate, there is also the simple fact of “is Lean about tools or about thinking?”

    If about tools, then JIT and colocating plants might be Lean.

    If it is about thinking value and letting that drive actions, it takes a deeper look.

  8. Anonymous says

    Lean is all about thinking – tools are merely an outcome, they are like standard work documents for achieving results.

    -anon solectron guy (again)

  9. Rich says

    “Anonymous Solectron Guy”

    I worked for three years in the electronics assembly industry bofore moving changing to a completely different industry, and also found the “hype” didn’t often jive with reality. “Lean productivity” was often driven simply by buying faster chip shooters (and they just keep getting faster!). I also remember inventory being stacked everywhere, padding slow automated inspection equipment and other monuments resulting from poor line balance and quality issues. Is this what you are experiencing, or is it more complex than that?

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