Just Why Do We Eliminate Waste, Anyway?

What Price Cool?

Last week, my colleague Glen followed me into the parking lot one morning and told me my driver’s side brake light was out. So, a quick outing to the neighborhood auto parts store went on last Saturday's to-do list.

A mid-day outing took me to the auto electrical aisle today. I quickly found the required brake lamp and was reaching for it when my eyes jumped out at the blister card next to it. You see, I have endlessly bored my family and others doomed to take a car rides with me over the past couple of years with my fascination by the new class of LED brake lights and turn signals. You see them on cars and big rigs and can tell them because they turn on and off very precisely and crisply. Very different than the normal rise and fall times of light from a conventional incandescent lamp. OK, OK, maybe you haven’t noticed these things...but to this Purdue engineer, the LED signals look very, very cool.

And, this afternoon, in aisle 6, coolness appeared before my very eyes. On a blister card right next to the lamp I was reaching for was a plug-in compatible, simple-to-install LED brake light for my own car!! Opportunity knocked in my quest to be cool! All I had to do was put it into the brake light socket waiting for me in my garage! Only then did I look at the price of this coolness.

A pair of normal, dull, ordinary brake lamps was $3.00. A pair of cool LED brake lamps were $17.00. Whoa. Just how badly did I want to be cool?

What Price the Competition?

My wife and I went to a new, large home-improvement center Saturday to purchase material for a back-yard project. While in the checkout line, I spotted a sign that piqued my interest.

This store offered post-frame building packages, a virtually identical product to that which we produce. And, they did it in a self-service mode. A well-packaged touch-screen display allowed the user to configure a post-frame building to his/her exact size and shape. I walked up to the screen, started tapping and in about four minutes had a basic building designed. When I was done, the computer gave me a price for the materials.

I did some quick math to compare it with our pricing for a similar building.

Joe, please, what’s the point of all this?

To answer the question I posed at the top.

We eliminate waste to lower the price to the end user. Period.

Lean is about cutting out waste which adds no value to the end user. In so doing, we seek to deliver a product to the end user at a price that is lower than our competition.

It is tempting to think that the end of a Lean system is to have good documentation or good metrics or simple ways to move materials or low inventory or clean workplaces or good communication or single piece flow or no rework. Each of these are necessary. But in the end, only one things matters.

For me to buy those cool LED brake lights, the vendors are going to have to get the price down. I’d pay double to be cool, but not six times as much.

The customers of our company will ask, legitimately, how does your price compare to the one I punched up myself at the store? If we can’t deliver them a package for less than what they see there, they’ll buy it there.

It all comes down to price. Let’s never forget that.

I hope this is helpful.

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