Just one extract from an interesting study that came out this week from the Ministry of Industry. Globally, the percentage of French components in French products has dropped by 75% to 69%. Only a 6%  drop, you may be saying, but when multiplied by trillions of components sourced over the period, it’s pretty easy to understand why French industry is seen to be in decline.

Some industries come out better than others. 86% of components in high tech products are French, as are 80% of luxury goods. However, trains (including the TGV include only 62%, and the airlines just over half).

All of a sudden it is easy to understand why Airbus, for example, has faced consecutive delays to some of its major programmes. There most be a million or so components (if not more) on an A380. It would be a major job getting them delivered, tested and passed even with suppliers housed next door. If almost half of the parts have to be passed through customs and any questions raised during testing fed through a translator, it could become a little more difficult. Unless there are masses of stock both at final assembly and on the high seas or in distribution centres around the world.

It does make you want to ask ‘why’ at least five times!

In any case, the French government has decided to react and is thinking about introducing a ‘made in France’ label. How they are going to define ‘made in France’ based on some of the figures above is another story entirely.

4 septembre 2010: it closes at around 3672, barely over half of the level of 10 years earlier.

Source : Les Echos, 3/9/10

Now, Lean Thinkers generally agree that the Lean journey is far more difficult in those companies permanently fighting off shareholders pressures. Don’t you think that, with hindsight, shareholders 10 years ago may have been pushing longer-term Lean improvements rather than demanding short-term financial gain?

For the decline in value of French shares is far more acute than that of either the U.S. or Germany, as indicated by the diagram on the right. The U.S. and Germany are two countries where Lean Thinking has caught on far more than in France (I also read this week that unemployment has dropped in Germany for the 13th successive month).

OK, there have been three waves of crisis in the last years – the Internet bubble bursting, the subprime phase, and more recently international debt. However, contrary to the Dow Jones and Dax 30, the peak in 2000 has never again been reached since.And what is also worrying is that, back in 2000 (as is the case today), technology and innovation were seen as the way forward. 10 years later, technology stock accounts for only 6% of the CAC 40, against 40% at the time.

There have been successes, notably in industry : Air Liquide has increased by 87% and Michelin by 78%. However in the 10 leading stocks in terms of value at this moment, (Total, BNP Paribas, Sanofi-Aventis, EDF, GDF Suez, L’Oréal, LVMH, France Telecom, AccelorMittal, Société Générale), there is only one we could consider as belonging to industry.

Anyone with money to invest? I can only suggest putting it where Lean Thinking is rife, and sitting back with confidence that this is the best investment you can make for the next ten years.

Back in October of last year, about the time this blog got its first post and resulting spam comments, I hopped over to Chicago (as you do) to run in the very excellent marathon they have over there. The race was on the Sunday, I arrived on the Thursday, so that left Friday and Saturday to see the city. Well, Friday was sufficient for what I wanted to see, and I certainly wasn’t going to spend my time doing anything else too strenuous. Therefore a leisurely stroll around the centre saw me browsing through Borders, the bookshop, and coming out with what I thought was a fair-priced copy of the most recent novel of one of my favourite bedtime authors, Jonathan Kellerman (he shouldn’t be too proud, the sole objective of bedtime reading is to get me to sleep).

August 2010, and I finally got around to wiping the dust off the book with the intention of having a few early nights.All went well until page 187. The reasons are outlined in the note I sent to Random House, the publishers, on 22/08 i.e. 9 days ago.

“Dear Sir or Madam,  Back in October 2009, I travelled over from France to Chicago to run in the city’s excellent marathon. During my stay there, I purchased a copy of Jonathan Kellerman’s True Detectives, published by yourselves, ISBN 978-0-345-49518-1, at Borders in the city centre.   I finally got around to reading it this summer. Imagine my disappointment when, having read 186 pages, I was to find that the following page was 251. You probably have received a number of complaints by now indicating that page 187 to 218 were replaced by duplicate pages 251 in 282 during one of your production runs.   Ideally you could send me a correct version of the book. Failing this, and seeing as I will be travelling back to Chicago this October to run the marathon again, I will return the copy to Borders and ask for an exchange. I would however obviously prefer the first option.   Thank you in advance for your reply.”

Fairly direct, but it worked. The very next day, I got a reply.

“Thank you for contacting Random House, we appreciate your feedback and continued interest in our publications.

We appreciate your patience and hope you will continue to enjoy Random House publications in the future”

And lo and behold, today, 31 August, 9 days after my initial message, DHL turned up with the book. I can’t say that I have anything to complain about.

If this had happened in France, I’m not sure what the reaction would have been. Or maybe it wouldn’t have happened, as I’ve never known such a gross printing problem occur. I can’t imagine what kind of QC procedures the Random House printers use. And no, they don’t outsource to China, at least according to the information on the front cover of the book.

So tonight, I’ll finally get around to reading pages 187 to 218, which should be interesting, as I’ve already finished 219 to 462!

And so, yes, in five and a half weeks, I’ll be back thrilling the crowds (well, they were clapping and cheering last time) over the 26 miles in Chicago. And paying a little more attention to the number of pages in any books I buy.

One of the measures announced was to provide ’support’ to entice French companies having offshored production to bring it back into the country. 20% of the billion or so euros available have been set aside between now and 2013 to provide financial incitations to bring back the work.

Last week, the first company to benefit from these measures was announced. A foundary, Loiselet, in the north of France had transferred production to China some years ago as environmental restrictions had limited its potential for expansion. The return on investment however was offset by the transports costs (one would have thought that this may have been calculatable beforehand?) and the government offer of a reimbursable loan was sufficient for them to decide to transfer back, and invest 12m euros in the French site.

The qualifying criteria? You need to be a company of less than 5000 employees, have a project of more than 5 million euros, and commit to creating and keeping at least 25 jobs for the next three years. The aim is to create 2000 jobs over the next few years – which needs to be put in the context of the 2m industrial jobs which have disappeared over the past 30 years, but it is hoped that the success of the measures will provide a springboard for others to follow suit under their own steam.

There are, as is the norm in France, those who dispute the real value of the measure, and claim that companies are starting to come back anyway. A furniture manufacturer, Majencia, transferred production to China in 2000. Theoretically,  there was a 20% cost advantage in doing so, but this was soon reduced to 10% due to the extra logistics costs (another lack of foresight?). In 2006, the work was transferred back after an agreement with the works councils that the remaining 10% difference could be cancelled out by productivity improvements. Atol, a network of optical centres, had to transfer production to China in 2003 as there were no French companies prepared to take on the small batch sizes of spectacles to be manufactured. It’s now all coming back (what a difference a financial crisis makes) and the opportunity taken to work with local manufacturers on providing innovative products, which was not possible when the suppliers were oceans away.

A form of protectionism it may be, but the French government is showing the way, and hopefully more companies will be jumping on the return-trip bandwagon over the next few months.

Scared by taking less time to get something done. Well, it got me thinking, and concluding that there is a probably a link between this type of point of view and the difficulties we have in France is driving ‘Lean’ thinking. It’s all to do with the culture!!

A post a few months ago made a reference to the government’s plan for industry, in which ’subsidies’ was the buzzword, ‘productivity’ hardly mentioned (apart from wondering why the Germans are so much better at it) and ‘Lean’ not at all.

In the past 30 years, the price of petrol has been divided by 2, steak by 3, oranges by 4 and electric light bulbs by 5. All thanks to skilled industrial engineers making the changes required to drive ‘productivity’. Consumers have therefore benefitted greatly from the progress made, but have as a result interpreted productivity in only one of two possible ways – producing as much using less resources… and in most people’s minds, the resources in question are the people themselves.

Very few people see productivity as an opportunity to make more with the same resources. Therefore, productivity has become linked to social recession. In the same way, using time as the unit of measure induces concern and maybe even stress, rather than joy and excitement as the potential of being able to make and sell so much more.

France is and always has been a very creative and innovative country. Information systems is the current thing to be in. I saw an article this morning in which it is reported that over the first half of this year, national results for the big IT companies are far better than the international averages. The French love creating things.

However, growth cannot feed on creativity and innovation alone. Production and productivity make our daily bread. Innovation and productivity feed off each other. And it is time for us all to stop worrying whenever we hear the P word.

As a child, ‘WOW!!’ moments are part and parcel of growing up, as a teenager they tend to be associated with girls and music. As an adult, as we become supposedly wiser and more experienced – seen it all, done it all – there’s always a danger that each WOW!! (which still often tend to involve girls, but from a long way off!!) could be the last.

Well, I have just had one, and it was so enjoyable that I think that I’ll now dedicate the rest of my life to seeking out further ones (a joke, by the way!).

Permanently looking for new ideas and approaches to develop my business, I decided that it was time to develop another web site to ‘reach out’ to a new audience. What I have done in the past is to develop sites from a standard template, and I took the time yesterday – Saturday – to review the offerings from the different service providers. I came across a recently excellent site from Lucky Marble Web Solutions on which not only are there hundreds of really excellent templates which can be personalised and reviewed before purchase, but also a very comprehensive set of education videos which, in my humble opinion, would enable even the most inexperienced of potential website developers to build the confidence and know-how necessary to do something by themselves. Reasonably priced compared with the ‘competition’, and on top of that a $10 ’summer sizzler’ discount. Why would I go anywhere else?

So there I was, beginning of Saturday afternoon, a proud owner of a spanking new Dreamweaver template, ready to take further steps towards world domination of Lean Supply Chain consultancy……

Unfortunately, things weren’t going to plan. Despite what I was seeing on the education videos, I just couldn’t get the same things to happen as I started developing my first pages. The videos did insist – very strongly – on the importance of getting Dreamweaver to set up the site correctly, and I thought that I followed the instructions correctly, even though there was slight difference on my PC…..

By the middle of the afternoon, having gone through around 5 reinstallations, I decided that it was time to get the Lucky Marble support people involved. After all, it is their template. I didn’t find the answer to my problem in the FAQs, forum and support videos, so I left a message on the technical support describing my issue. The site indicated that I’d get a rapid reply but within normal weekday working hours, so with the time difference between Canada and Europe, I reckoned it would Tuesday morning my time at best before I got anything.

Imagine my surprise getting up this morning and logging on as I saw that I had not one, but two replies: a first one from a gentleman called Brandon Devnich, who is systems administrator at Lucky Marble, and who told me that “Typically, we don’t even check the ticket centre on the weekend, but I had something else I was looking into and thought I’d just glance in to see if there was anything pressing — your issue was something I thought needed addressing right away.”

Brandon had passed on my ticket to Colin Fraser, who I’d almost got to know through listening to a few of his short ‘how-to’ videos during yesterday afternoon. And after Brandon’s message, there was one from Colin, had not only taken on my issue in less than one hour after receiving Brandon’s note, but went to the trouble of building a five-minute video to actually how to get around the issue I was facing. And this was not even a problem with the product – this was a particularity with how Dreamweaver is installed on certain PCs – watch the video to learn more.

That was my WOW!! moment – hearing Colin say “Hi Peter”. And do you know what? The simple solution outlined in the video works!! And it’s now Sunday morning, and I can get on with what I was planning to do, 48 hours ahead of what I estimated was going to be the best time I’d get a reply.

WOW!! Thanks Brandon, Colin, and Lucky Marble.

Anyway, of the 98% of the 50%, the vast majority comes up with common themes. Womack and Jones’ five principles. The importance of ‘Respect for People’. The key role of management.The contribution of the people.  How Lean is a journey, not a destination. Etc etc.

One other common observation is that ‘Lean is not easy’. It doesn’t happen overnight. It needs courage, burns calories, loses sleep, and damages marraiges (OK, maybe not the latter, but I imagine that there must be odd occurrences).

So we all agree, Lean is not easy. Don’t we?

Well, have you ever tried to move a mansion house?

I have just watched an amazing programme on Expert House Movers. These are people who plan for months and work for weeks (no, I didn’t get that the wrong way around) to move large buildings, and in this case a typical townhouse from 1906, a few hundred yards to make place for other construction (in this case, a hospital extension). Respect, respect. OK, there may be other engineering feats far more impressive and strenuous, but they haven’t passed on French TV yet, and this one simply took my breath away.

Basically, they drill holes into the foundations, insert massive metal beams, lift the whole building upwards, insert wheels… and then roll it along. Fascinating. Check out the videos on the Expert House Movers site.

The one thing that got me on this programme was that everybody concerned was serein and calm, knew exactly what they needed to do, immediately stopped everything should there be the slightest problem or risk… and they all seemed to be smiling.

And this stuff is probably five thousand times more difficult than implementing Kanbans and performing Ishakawa analyses. So the next time you are a little down in the dumps because the Lean projects are not progressing as planned, slip on a Expert House Movers video.

These people have Lean culture fine-tuned down to an art.

The ninth waste in question is theft, and Air France, being the major carrier into and out of Paris, is suffering the most from the lack of process control of goods destined to make trips with Air France more comfortable.

For example, blankets, pillow cases and tablecloths used in the long haul flights mysteriously disappear…. most probably in the hands of the passengers themselves, at a cost of 1,9m euros per year. The loss of cutlery and porcelain plates and cups amounts almost to as much.

However, it is not just the passengers who have light fingers. It is estimated that one in ten bottles of champagne never actually makes it onto the plane in the first place. The toiletries are another favourite for those dealing with the transport, as well as the meals themselves. And almost half a million of euros worth of newspapers disappear without trace. What can they possibly do with a few hundred copies of today’s papers?

Duty-free items, despite stringent security, and first-aid kits come in for the same treatment. But probably the most strange items to disappear are the metal trolleys used to serve meals and drinks. 630 000 euros worth, taken probably for the value of the metal!

The fact that the word ‘theft’ is the same in French (’vol’) as the word flight, this report potentially adds a new slant to Air France’s marketing campaigns!

All around the world, there are examples of suppliers being asked to obtain certifications as a condition to being considered as a potential partner. We also have examples of them being asked to develop Lean programmes, or even set up production units close to the customer’s facilities.

However, I would suggest that it is only in South Africa that a condition has been introduced based on the percentage of black employees in the suppler’s workforce. The programme didn’t go onto to investigate whether ISO 9000 and Lean were also criteria taken into consideration, but it was definitely the case that no blacks, no business.

Of course, in a country where 90% of the population is black, probably 99% of managerial roles are held by whites. The programme did manage to find the token black director who, in a similar fashion to South African rugby in the 90’s where the first black players were introduced as an appeasement to public opinion, seemed to have been ‘promoted’ specifically to be interviewed by foreign television crews. He seemed quite cool about it and openly described how his board colleagues giggled whenever he had something to say. Maybe there’s one less black board member this morning?

Of course, there was a political slant to the programme which had nothing to do with good logistics practice. Blacks were seen either as corrupt, pilandering murderers or living in hovels with excrements piling up by t he front door. Whites are either exploiting the black workers or setting back barricades on their farms to avoid having their throats ripped out by the aforementionsed pilandering murderers.

However, I do suppose that there are some fairly normal people in South Africa who are developing supplier relationships based on comparatively normal criteria, as well as some fairly normal public servants who will take time out from the charging the black demonstrators to charge English and Italian football hooligans over the next five weeks.

Hopefully South Africa will benefit from the visibility it will getting to one day finish off the work Mandela started 15 years ago now.

A 2006 report indicated that the efficiency of the education system in France was below the average of developed nations (OCDE). If you want good schooling, live in Finland or… Korea. Now, a national investigation has revealed that :

- one in five children suffers serious reading diffculties during his school curriculum (and it’s a lot worse in maths),

- one in six leaves the schooling system without any qualifications.

This is despite the fact that 3,9% of GNP (average for the OCDE countries) is dedicated to education, but the number of pupils is far less than in Finland or Japan, who also come out really well.

Conclusions of the government task force : “it is a problem with organisation and management“. Well, I wonder how much they got paid to come up with that one!! Some of the observations made are that :

- very little review of the education policies against actual pupil requirements (who said ‘customer value’?),

- redundancy of the different systems of extra hours in place to help students with difficulties (’overproduction’),

- a too high centralisation of recruitment decisions with the local heads having very little say (’misuse of workforce potential’).

The measurement system comes in for criticism. For example, France is ‘world champion’ in having students redo a year’s curriculum due to insufficient results (it happens to 40% of them before they reach 15), with no evidence that doing improves results in the long term. However, schools obtain resources based on the number of pupils per level – where is the incentive to whisk them through the system?

The school year is made up of 144 days work, one of the shortest in the world (and I know for the fact that my son spends many of those idling his time away in self-study periods). Nearly half of lessons attract small groups given the diversity of subjects that are on offer. And who comes out of this the worst off? Those from the lower social levels, of which only 18% obtain the ‘baccalaureat’ against 78% for the better off.

What is the most frustrating in all of this is that there doesn’t seem to be a plan in place to make things any different!!

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