Ananth Raman, UPS Foundation professor of business logistics at Harvard Business School and co-author of The New Science of Retailing, spoke at the American Apparel and Footwear Association’s (AAFA) annual summit last month in an eponymously titled session. As it happens, much of what Raman shared was neither new nor science, but his points resonate in many fundamental ways.
Raman’s remarks honed in on execution, empathy and innovation. He said, “I feel that because there are so many things for executives to do on a daily basis, we don’t step back and think of things that are really important.” Today, that is probably true for most people, in most aspects of their daily lives. We’re overscheduled, and it’s difficult to find time to take a step back from the busyness to observe and listen.
This leads me to one of Raman’s key points, which I’ve thought about a lot since. He said, “Excellent execution and mediocre strategy will beat mediocre execution and excellent strategy.” That’s a fairly bold statement, given the generally widespread reverence for ‘strategy’ across corporate culture. Then again, it’s also just another way of expressing another message that came out of corporate culture — Nike’s — but that has resonated, globally, with millions across cultures: Just Do It.
One way to channel always-limited resources into on-the-ground execution instead of endless C-suite strategizing is by going straight to the site where execution occurs.
To illustrate the importance of this and the success it can produce, Raman used Toyota as an example. You may be familiar with the Toyota Production Systems (TPS) story, but it’s worth revisiting. Back in the ‘90s and up through the mid-aughts, U.S. sales of Toyota automobiles ascended steadily, while sales of iconic American brands such as GM and Ford declined. There was one core reason for this: quality.
Why was Toyota’s quality so good? In short, because of “Andon cords” — ropes that hung at each workstation on the factory floor. Each time a defect was encountered, the employee pulled the cord, stopping the assembly line. A manager addressed the problem, and it was fixed, right then and there, before it became a bigger problem further down the line. The stop not only ensured the quality of that particular car, but the knowledge gleaned was then fed back into design and production, leading to continuous improvement. Yes, time and energy were expended up front but, ultimately, this eliminated muda (Japanese for waste) and created a better and more desirable product.
This seems so obvious and easy, and yet it’s still rare. “Why were other companies not doing this?” Raman asked. “Do you remember a rope shortage?”
There are several reasons this happens so infrequently. In the short run, it’s more costly and more aggravating to stop and examine problems (at just one single factory, the Andon cord was pulled approximately 3,000-4,000 times per day!). But it’s also because executives overestimate their own contributions while underestimating those of their employees, says Raman.
This produces bad juju for two important reasons: 1) By not listening to employees who are closest to the product and the consumer, you are missing out on a vast wealth of crucial information; and 2) When you don’t listen to employees and don’t recognize their worth, you are telling them that they and their contributions are not valuable. This is a recipe for creating a workforce that feels underappreciated and disconnected, and thus is apathetic and not loyal. That’s a lose-lose situation.
Listening to the front lines of your business — whether on the retail floor, factory floor, or elsewhere — is smart strategy. It allows you to focus on execution and moving forward, it builds empathy across the corporation by opening up the lines of communication and allowing respect and dignity to flow both ways and, finally, it puts you on the path of innovation. Because innovating — renewing or changing — comes from the creative interplay of knowing intimately what already exists and also seeing the white space where there’s opportunity to grow.
If you’re not listening to your front lines, today is a good time to start.