Page 280 - Lean six sigma demystified

258 Lean Six Sigma DemystifieD

Make sure you’re in charge of whom your customers return to year after
year. Hitting the goal posts isn’t good enough any more. You have to hit the
target value most of the time. Your customers will love you for it.

The Hole in Krispy Kreme

My wife and I flew from Kahului, Maui, to Honolulu, Oahu, a few months ago.
Almost every Hawaiian who boarded the flight was carrying two to four dozen
donuts from Krispy Kreme. It seems that Maui got a Krispy Kreme franchise
before Oahu, so everyone who traveled to Maui was picking up the new donuts
and muling them back to their families and friends on the other islands.
I thought, “Wow, that’s wild word of mouth. Maybe I should buy some
stock.” Then I did some investigation. As it turns out, the explosive growth was
more of a fad than a sustainable business. The stock that went from $21 to $105
in 2000 but has fallen 90% from its 2003 peak.

Changing the Focus

The new CEO and turnaround specialist Steven Cooper says “You can’t rely on
word of mouth to keep expanding the circuit of loyal customers.” Instead, you need
to focus on running an efficient operation in an industry with razor-thin margins.

Efficiency and Effectiveness

Having a great product is essential to customer satisfaction, but you also have
to deliver it in a cost-effective manner. You can only increase sales so much.

There are limits to growth; it doesn’t matter if you’re McDonald’s or Wal-Mart.
To maximize profit and sustain success, you also have to trim the delays, defects,
and deviation that nibble away at your profit margins.
The QI Macros started out from humble beginnings 15 years ago. Since then,
I’ve added endless enhancements requested by customers from all over the
country in everything from health care to automotive industries. At a recent
Institute for Healthcare Improvement conference, a number of fans dropped
by our trade show booth. It felt great, but I also remember that I have to end-
lessly improve the QI Macros and streamline their delivery. As Andy Grove of
Intel fame once said: “Only the paranoid survive.”
Here’s my point. It’s not enough to have the most innovative new product
or the best customer service. If you aren’t optimizing and streamlining the