News Archive

Mariotti Latest Article On Amex Open Forum--An Important One

Mariotti continues to create original articles on American Express OPEN FORUM. See the latest one The Most Important Factor in Business Starts with a "P".

Mariotti On The Quest For Profitable Growth

See John Mariotti's latest post on American Express OPEN FORUM, which is one of his best on the quest for profitable strategic growth--and how to get it--or not.

See John Mariotti's latest article on American Express OPEN FORUM

"Do You Have The Right People On The Bus?" is the title of John's latest work discussing the challenge of finding, selecting and leading people.

20 Tips to Save Time & Money in Your Small Business and at Home

"20 Tips to Save Time & Money in Your Small Business and at Home" is the title of John Mariotti's latest post on American Express' OPEN Forum. There is no "rocket science" in saving money. It is all about being smart, planning ahead and practicing discipline in how you spend--or rather--don't spend your money.

Mariotti Offers Sound Advice

"Managing in a Turbulent Economy" was posted today on American Express OPEN FORUM blog. In this practical primer on how to deal with a few of the pressing issues of the day, John offers suggestions that should be helpful to many business people.

A Very Useful Article--7 Steps To Survive And Succeed

That was how one reader described John Mariotti's latest article, 7 Steps to Survive and Succeed - And leave competitors wondering what happened, which is posted on Roughly Famous right now.

Mariotti's latest interview

John's interview on Supplier Payment Terms appears in two places; considered to be excellent advice by editors. His recent interview with Anita Campbell, Editor of SmallBizTrends.com and the Financial Management section of Small Business Trends

Mariotti Featured on American Express Open Forum

"Are You Ready for a Crisis? You Can Be!" is the latest article that now joins John's earlier post, "An Advisory Board - Best Source of Guidance for Your Business" on American Express' Open Forum, a widely read and highly regarded blog that covers a wide range of topics for business owners.

Read Six Of John's Latest Articles--To Help You Deal With The Current Downturn

Mariotti Addresses 8th Annual Global Supply Chain Conference

The conference, held by The Neely School of Business at TCU, was titled MANAGING SUPPLY CHAIN COMPLEXITY-KEYS FOR SUCCESS IN CHALLENGING TIMES. John's presentation, THE COMPLEXITY CRISIS--Conquering Complexity to Focus on Innovation was right on target and very well received by the audience. The conference was held at the Speedway Club of the Texas Motor Speedway in Fort Worth, TX on March 4, 2009. Attendees were a mix of local and regional supply chain managers, senior executives, TCU faculty and top tier students. Morning conference sessions were also attended by members of the North Texas Commission. The breakfast speaker was Richard W. Fisher, President & CEO of the Federal Reserve Bank of Dallas.

John Mariotti speaks to Presidents & CEOs at the American Management Association Course

Mariotti, the featured luncheon speaker on the middle day of the program, shared insights from The Complexity Crisis. He also addressed a series of business-specific issues raised by the diverse class of executives, who traveled from 15 different states and 2 foreign countries. The class was held in Naples, FL. on Dec. 3, 2008.

Mariotti Appears On MSNBC's "Your Business"

John Mariotti was one of the guest panelists on MSNBC's Your Business recently. The show airs at 7:30AM Sunday and again at 5:30AM on Saturday (this show is scheduled to air on Feb. 8 and Feb. 14). The topic of the show was how a small business who got the "big order" (from Starbucks during its growth era) found it crippling--and what might have been done to prevent--or remedy--that kind of outcome.

The Complexity Crisis Named One Of Best Business Books Of 2008--For Small Businesses

The editors of Small Business Trends chose John Mariotti's book as among their best business books of 2008. This is the second award for The Complexity Crisis, having been chosen previously by Soundview Book Summaries as among 2008's Best Business Books.

Mariotti to be featured in Colombian magazine--Tiempo de Mercado

John Mariotti's article "Marketing in Tough Times" appears in the most recent edition of Tiempo de Mercado a new publication from Medellin, Colombia, SA. In the article, Mariotti ties into key points from the recent release of an new edition of SMART MARKETING (Capstone/Wiley 2004).

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Mariotti cited in DELL INSIGHT lead article

"The Power of Two" is the lead article in the June 2004 issue of Dell Inc.'s highly regarded magazine, DELL INSIGHT-Business Innovation Direct from Dell. Since the feature dwells on partnerships, there is a sizable quotation from John Mariotti's work on partnerships, citing statements such as, "The partnerships that work best are not all touchy-feely softhearted deals,"...There is a valuable and necessary tension between the soft and hard sides. ...This requires clear understanding, specifically stated expectations, measurable goals, detailed commitments, vigilant follow-up, and single-mindedness of purpose-nothing else will do."

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Mariotti Commentary on Global Manufacturing Leads off AMA's Winter 2004 MWorld Magazine

John Mariotti is in print again--and in a leading role discussing a critical topic. Mariotti's commentary "What Should We Make, Where Should We Make it, and What Should We Buy" greets readers as the opening article on page 4 of The Journal of The American Management Association. In this Quarterly magazine circulated to the entire AMA membership, Mariotti discusses the issues facing US manufacturers and offers insights and suggestions on how to think about and address some of these challenges.

Since defining a problem is the first step towared solving it, Mariotti offers a list of Ten Global Challenges to US Manufacturing. It is presented here for readers convenience. From 2000-2001, Mariotti was a regular weekly columnist in AMA's "Viewpoint". (Full access to MWorld is limited to AMA members at http://www.mworld.org).

Ten Global Challenges to US Manufacturing

  1. Labor costs are dramatically lower in Asian countries than in the US; often, overhead and profit demands are subsidized in LDCs to create badly needed jobs.
  2. Lead times and cost for tooling and machinery are much lower.
  3. Labor availability and work rules (usually without Unions) are much freer in LDCs.
  4. Technology and know-how is quickly and easily transferred via the Internet.
  5. Communications advances have made remote design and management easier.
  6. Internet based "auctions" allow producers to "bid" on work regardless of global location.
  7. Employee benefits-vacations, health care, pensions, etc.-are huge cost burdens to US manufacturers.
  8. Regulations in the US are much more stringent, costly, and well enforced than in LDCs.
  9. Pegged currency makes Chinese goods cheaper than global market conditions dictate.
  10. Quality in LDCs has improved enough that many goods are comparable in quality to (or even better than) US production.

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Mariotti quoted in FAST COMPANY lead article

John Mariotti's experience in working with Wal*Mart was extensively cited in the recent Fast Company feature/cover article. Mariotti was one of the few contrarians who supported Wal*Mart as "tough but fair" to deal with, in yet another major article describing how Wal*Mart uses its huge power to bully suppliers.

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Get The Silence In Hardcover Format Now!

John Mariotti's novel, The Silence, is more important than ever; its story line is being duplicated by current world events!

Report: worms & viruses were likely a factor in Northeastern US blackout?

See the latest links to this story and others.

Buy the updated Hard Cover edition now!

Recent events make the story line of Mariotti's novel even more relevant to today's events. The Sobig family of viruses and the Blaster now openly attack all kinds of computer systems, leaving back doors and Trojan Horses with which future attacks can gain control of millions of computers.

In the tradition of Tom Clancy's techno-thrillers, Mariotti weaves a chilling story of international intrigue, domestic chaos and human emotions. Despite headlines about Iraq, al Qaeda, and North Korea, recent events involving worm viruses and successful attacks on the Internet reinforce the threats described in The Silence. Read about The Silence, check the current events news about cyber-terrorism or order the book from your favorite on-line bookseller.

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See John Mariotti's Latest in On-Line Publishing's Unique Format: Topical & Timely e-Docs at amazon.com/brownherron

Having trouble "managing in tough times"? Now you can get e-docs on specific subjects - like Managing in Tough Times - and find just what you want to read. This new feature, a joint venture of amazon.com and BrownHerron presents the work of many accomplished authors. The first John Mariotti e-docs are now available and more will be posted in coming weeks. Check back for new titles.

The Forest And The Trees -- A Business Parable
The Value Of Real Leadership -- Managing In Tough Times, Part One
Creating Positive Change -- Managing In Tough Times, Part Two
When Good Times Turn Bad -- Managing In Tough Times, Part Three
Managing In Tough Times -- The Complete Series

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Mariotti featured with thought leaders (AGAIN) in BUSINESS-The Ultimate Resource

The largest volume of business knowledge ever published goes on the market in September 2002. BUSINESS-The Ultimate Resource is a landmark in business publishing. BUSINESS will be to global commerce what Britttanica is to general knowledge. The gold standard of business information for the 21st century, BUSINESS will also be a source of information, inspiration and insight with original essays from more than 150 world-renowned business thinkers, leaders, academics, and practitioners such as Charles Handy, Warren Bennis, Jim Collins, Thomas Petzinger, Jr., Peter L. Bernstein, John Seely Brown, ...and John Mariotti (pdf).

BUSINESS-The Ultimate Resource is having its coming out party. This is a truly amazing resource and a huge bargain for the price ($59.95 for 2200 pages full of wisdom and information). I can only say that I would recommend it to any practicing manager as a desk reference, and as a place to catch up on the best management thought of the past century...all in one place. Try it, you'll like it.

...BUSINESS is a collaborative publishing effort by award winning UK publisher Bloomsbury, and US based HarperCollins' Perseus Publishing. For more information on this magnificent 2200 page volume visit PERSEUS PUBLISHING. To order call 800-242-7737 or fax 800-822-4090.

The cover of the May 2002 issue of Personal Excellence, lists features by John Mariotti with other notable contributors to that issue: George Bush, Stephen R. Covey, Zig Ziglar, and Brian Tracy. His article, "Your Search for Meaning" is just one of several that will appear in one of the three publications by Executive Excellence Publishing: Personal Excellence, Executive Excellence, and Sales & Marketing Excellence (all are available by subscription from www.eep.com) Mariotti also appears in the May and June issues of Sales & Marketing Excellence and is listed as one of the featured columnists on the cover of the June 2002 issue of Sales & Marketing Excellence.

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Books, Books and More Books

Mariotti's new books hit the web NOW and booksellers VERY SOON:
John Mariotti's latest is: Smart Things to Know about Partnerships which covers the topic of his first book, The Power of Partnerships, with all new material. Copies of The Power of Partnerships are still available direct from Mariotti -- simply send email to order.

Mariotti's new books are available now at leading on-line booksellers Barnes and Noble and Amazon.

Marketing Express Making Partnerships Work

John Mariotti is also proud to announce the release of TWO Brand New books (Marketing Express and Making Partnerships Work) designed for the time-starved manager (isn't that all managers?).

These and many other topics have now debuted on the innovative new web-publishing concept ExpressExec.com, which offers either regular paperback books or downloadable e-books.

 

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Virtual Viewpoints

Read John Mariotti's column in Virtual Viewpoints (members only) on the American Management Association's web site. NOTE: To find copies of recent columns written for the American Management Association visit the archive search at MWorld.org; or go read them here. For past years' IndustryWeek columns, search IndustryWeek's archives using "John Mariotti".

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SALES AND SERVICE EXCELLENCE is a monthly publication of Executive Excellence Publishing. In a successive issues--Nov. and Dec. 2004 , John Mariotti covers two timely topics, In "Smart Advertising" he discusses the importance of focusing on "destination products and categories" instead of trying to wring growth and profits out of tired commodity categories. In "Perilous Parity" he outlines five steps to avoid this trap and move your brand and product to a special and unique position.

Escalate to Excellence

To Attendees of the Wyndham Pharmaceutical Conference: "Escalate to Excellence": I have posted all of my slides (except those that were created "live" during our discussions). There are more here than I used, since I edited the presentations to fit the time frame. You will need an Adobe Acrobat Reader.

Part 1: Personal Best

Part 2: Professional -- Role Models

Part 3: Organizational --Together

Part 4: Cultural -- Diversity

Part 5: Breakthrough Thinking -- Beyond The Best

Part 6: Are you willing to struggle?

John Mariotti is the featured guest on "The Secrets of Success" radio show, with host Bill Horan, to be broadcast on WHPC 90.3 FM in the New York City metro area on April 9 from 5:30-6:00PM and on April 10 from 4-4:30 PM. The show concentrates on Mariotti's latest book, Smart Things to Know about Marketing.

Mariotti Addresses American Marketing Association Chapter Meeting --Feb. 14, 2001 (for a pdf copy of slides, click here)

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"The Next Peter Drucker"? "A New, Improved Tom Peters?" WHO IS THIS GUY?

Strong words used to describe the management and leadership "guru" of the 21st century. This guy's name is John Mariotti. "John Mariotti understands more about the collision of the old and new economies than anyone else I've heard from-he tells it like it is-and like it will be!" is the way one client executive puts it. John Mariotti's first book, The Power of Partnerships (Blackwell 1995) is still considered the classic in the field. Guru Tom Peters said, "John Mariotti knows his subject cold. This promises to be the best-and most practical-book yet on partnering; and no topic is more important for doing business these days."

Mariotti comments on the challenges of the global cyber-speed world of business in these terms "Managers today struggle with the conflict between 'perfecting the present' and 'finding the future'. Business is a game where the score is kept in money. The prize for winning is that you get to play again!" Picking up where Peter Drucker left off is Mariotti's forte. "I want to help companies by sharing decades of experience and learning with them. I also hope to involve many of my outstanding colleagues in this effort."

John Mariotti built an industry world-leader as President of Huffy Bicycles (for 10 years), and he was President of a multi-national group for Rubbermaid-in its "good days" when it was America's Most Admired Company. For the past 10+ years, Mariotti has been broadening his expertise as a consultant to a veritable Who's Who of companies, a director on 5 corproate boards, a speaker and writer, a conference moderator, an educator, a major-market radio talk-show host, a web-discussion moderator, and the author of eight books. His newest release is entitled "Smart Marketing" just released by Capstone (Wiley) UK.

Mariotti comments on his writing efforts , " Helping people and businesses succeed is my mission in life. I like advising clients and writing on themes that are useful to practitioners and have the merit of sound strategic thought-and that is always a challenge."

So, while Mariotti is obviously not totally undiscovered, he is "coming out" as more active commentator on the direction of the business world, using his blog as just one media format http://mariotti.blogs.com/my_weblog/. Professional associates say "his insights are in a class with Peter Drucker". Mariotti denies this accolade in deference to having been a student ofthe legendary Drucker's works throughout his career.

"As exciting as Tom Peters, but with less yelling" is one description he admits to, although he counts Peters among those "gurus" he knows and admires for his outspoken tirades and revolutionary perspectives. "More inspiring than Lou Holtz" is the way an attendee at one of his keynote presentations phrased it. Mariotti has been termed "a great interview" by Chicago (TV) business-show host Jack Taylor. Mariotti is often quoted or interviewed in the media-including CNBC, and the Wall Street Journal -but he is still largely undiscovered by the vast mainstream of American business and media.

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This release is announcing Mariotti's "coming out party"

He is opening up his insights to wider audiences on "Telling It Like It Is" --a weekly updated weblog. (http://mariotti.blogs.com/my_weblog/). After 5 years as a regular columnist "On Management" in magazines (for IndustryWeek), he was a regular web columnist for the American Management Association's www.mworld.org and a periodic contributor to Fortune Small Business' www.fsb.com as well. He is also a regular contributor to Executive Excellence, Sales and Service Excellence, Bottom-Line Business, and more publications.

John Mariotti has spent the past 10+ years advising a Who's Who of American companies as consulting and/or speaking clients. These include: Manco, Inc. div. of Henkel KGaA, The Scotts Co., Titleist-Footjoy, div. of Fortune Brands, Dirt Devil (Royal Appliance Mfg.) CharBroil, Emerson Electric Co., Hill's Pet Nutrition div. of Colgate, John Deere, TVA Southern Co., Arthur Andersen Consulting, Astec Inc., Union Tools, Fitness Quest and many more companies.

Mariotti offers his years of knowledge for exciting and usually controversial interviews with interested media. Of particular interest to investors and managers are his observation about "Winners & Losers", both on his blog, and from his books on Brands, Marketing, and Strategy in which he either compliments or criticizes companies like Rubbermaid, Kodak, Levi's, McDonalds, GM/Saturn, Volkswagen, Apple, Wal*Mart and others.

Mariotti's unique Reunion Conference series is going into its 10th year. The Reunion Conferences are exclusive, invitation-only roundtable retreats for executives, educators and entrepreneurs. A few past themes have been A Celebration of Values, Many Paths to Success and The Search for Truth, Finding Meaning in the New Millennium, and A World of Change and Opportunity. In the Reunion Conferences (www.reunionconference.com), lively discussion is the norm. Participants come away refreshed, wiser and more fulfilled after 2 1/2 days of reflection, camaraderie and idea sharing. Employing principles from his first two books, The Power of Partnerships (Blackwell 1996) and The Shape Shifters: Continuous Change for Competitive Advantage (Wiley 1997), the conferences cause attendees to exclaim, "We talk about the kind of things we can't or don't talk about anywhere else. It is just fantastic"!

Mariotti even announced that starting in 2006, he is opening up his speaking schedule to few more selected spots-for the right audiences. His past keynote presentations have included the CEOs & Chairmen of the National Health Service Trust Hospitals of the United Kingdom, and over 1000 leading executives of the National Industrial Transportation League Annual Convention in the U. S.

This release coincides with the announcement of Mariotti's latest book releases- new editions--one from the "Smart" Series by Capstone (Wiley), a leading U.K. publisher: Smart Marketing and another from the ExpressExec Series, also from Capstone (Wiley): "Marketing Express." Mariotti commented on these books "In today's time-starved and pressure-packed global business, nobody has enough time to read the wordy, theoretical management books, so Smart books and ExpressExec books (also downloadable in pdf format) cover the material fast and can easily be read in short takes."

For more information, visit John Mariotti at http://www.mariotti.net or email him atmariotti@usit.net.

Contact information The Enterprise Group
John L. Mariotti
Email: mariotti@usit.net
Web site:http://www.mariotti.net
Phone 614-840-0959

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John Mariotti featured on Sound Business' audio tape on The New Millennium

Sound Business, a widely distributed audio tape series, recently release its edition on The New Millennium. On this tape series, a number of experts are asked to comment on the Future, both positive and negative; and on the widely discussed topic of e-business.

John Mariotti is featured on both parts of the tape: "The Crystal Ball" and "Worries, Frets & Solutions. Sound Business is located at P. O. box 1110, Sugar Grove, IL 60554.

Excerpts of John's comments from the tape can be heard by going to the audio by clicking here.

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New Books Released

John Mariotti's fourth book, Collaborating for Success is one of the six part The Collaborative Leader mini-book series published by Berrett-Koehler.

John Mariotti's third book, Smart Things to Know about Brands and Branding (Capstone, UK) is currently being released.

John Mariotti's third book, Smart Things to Know about Brands and Branding (Capstone, UK) is currently being released.

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Unfinished Turnarounds Have Roots in Ignoring the Customer

©John L. Mariotti

The business media and Wall Street analysts are often ready to glorify the success of turnarounds well before it is deserved. Good (and bad) things that happen in companies don't occur suddenly. Such events are usually the result of 1 to 2 years (or more) of good (or bad) management. There are a few well known companies whose turnarounds have been amply complimented and in some cases rewarded with higher stock prices, butaas they say in the old detective movies, "not so fast, there!" "Chainsaw" Al Dunlap's deceptive turnaround misadventures have been well documented. But there are others that remain unfinished-and uncertain of success!

Sears took years to get out of step with the shopping habits and desires of consumers, so it isn't fair to expect Arthur Martinez to turn it around overnight. He made admirable progress in promoting "the softer side of Sears". The clothing in the stores is more fashionable and their overall merchandise selection improved. Unfortunately, Sears is still saddled with old stores, pricey mall locations, and the ambience of a bowling alley. It seems the widely proclaimed turnaround in profits was created mostly by liberal credit card policies, which in turn have led to large bad-debt risks. Whoops. Martinez himself often admonished that the turnaround was not complete. The question is--when a big one like this stalls in mid-turn, can he get it moving again. The Targets, Wal*Marts, Dillards, and Kohls are not waiting for them! The central message: Sears improved a lot, but so did everyone else, so relative positions changed little.

George M. C. Fisher had an admirable track record at Motorola. Then he left to fix Kodak. Both companies might have been better off if he had stayed at Motorola. He was too "nice" to hack away the excessive overhead at Kodak right away. Too many of the same people who got them in trouble were allowed to stay in place. Although Fisher did get rid of distractions like pharmaceuticals, Kodak continued to believe that consumers would pay a premium for the film in the yellow box. Wrong! Fuji dropped prices, attacked aggressively and took large chunks of Kodak market share; so did mass retailers' cheaper private label film. Once consumers found that their snapshots came out fine with these other products, Kodak's job was doubly tough. Slow in entering and capitalizing on digital photography, Kodak is still one of many competitors in this photo-technology of the future. After making some hard cuts in recent years, Fisher is leaving with the turnaround stalled in mid-turn. The message of this one is in Einstein's famous quote: "We cannot solve today's problems by thinking the way we thought when we created them".

As I grew up, Levi's was a generic name for jeans. Now they are fighting for their market share--and maybe their corporate life--as they close plants and lay off employees. The Haas family's noble concern for the culture and the well being of Levi's employees has been undermined by their failure to pay attention to customers and trends in clothing. Only the successful Dockers line and the massive move to business casual attire have kept Levi's from even further decline. Youth dictates the fashion in jeans. Levi's became great by remembering that, but somewhere along the way they got the same disease many large industry leaders are afflicted with--they think they know better than the customers. Designer jeans took the high end. Private labels and VF Corporation's Lee and Wrangler brands took the lower and middle. Levi's was left holding little but a shadow of their former dominant market share. The message in this one is simple: the customer is always right--never forget it!

What other turnarounds have stalled in mid-turn? Two of the most obvious are both Detroit based: General Motors and Kmart. Documenting the "General's" misadventures has already filled several books, so I will only devote a sentence or two to them. GM is making much better cars, although still not as good as leading Japanese and German producers. The big problem for GM is that Ford is more productive and has added Volvo and Jaguar to their repertoire, and that Chrysler now has found a "big brother" in DaimlerBenz and it was quicker and more innovative than GM all along. I'll say it here--GM will be the world's number 3 automaker in less than 5 years. There is no turnaround coming here.

Kmart has made great progress, but their problem is like Sears. While they have been making progress, their competitors have also. The same message applies to both GM and Kmart: You cannot overtake and pass others in the race if everyone accelerates at the same rate, and if you miss a beat, it is all over. Look for Kmart to be acquired by a big grocery chain before much longer--it is the only way they can survive long term. Big turnarounds are tricky and difficult to complete. The best policy is to keep from getting in that kind of arrogant trouble in the first place!

"Nothing is so powerful as an idea whose time has come." -- Victor Hugo

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Condition Monitoring-The Technology Whose Time Has Come

© John L. Mariotti 1999

"If it ain't broke, don't fix it." Is what the old saying tells us. The new management mentality might be more readily stated as "If it ain't broke, fix it before it breaks!" This is not a bad idea. But how do you know when something is about to break? Simple-monitor it continuously.

Few things are as disruptive to our life these days as when your car breaks down. In the early days of automobiles, common practice was to drive the auto until it broke down and then get a mechanic to fix it. As automotive engineering advanced, gauges were added to cars, so the driver could watch the key parameters-fuel, coolant temperature, oil pressure and electrical system charging. Technology continued to improve, but the so-called "idiot lights" were not always welcomed. These warning lights in cars told the driver which system was out of the preset limits, but only gave a warning when failure was imminent-not that it was approaching gradually.

Finally, as we approach the turn of the century, autos are now using embedded computers to monitor the conditions in the key working systems of the car. These monitoring systems will warn of the need for attention due to low fuel, low tire pressure, pollution control malfunctions (thanks to the EPA), and the more advanced even monitor the need for service because the oil is beginning to become dirty or less effective.

It is surprising that we are willing to pay for these devices in a $30,000 auto, but are willing to continue using far less effective condition monitoring (or none) on critical pieces of production equipment costing not $30,000, but $300,000 or $3,000,000. The technology for condition monitoring has been developing rapidly for the past decade. This is appropriate as more and more companies replace labor with capital equipment, and achieve great productivity gains by doing so--at least as long as the equipment is operating. When any piece of production equipment breaks down unexpectedly, the cost of the disruption and lost production is usually measured in hundreds or thousands of dollars per minute.

In the old days, when a line shaft powered factories, a failure in the steam engine that drove that shaft shut down everything. Those steam engines were monitored in their own way, through an array of pressure and temperature gauges and the vigilance of the boilermaker or steam fitter whose job it was to tend them and keep their fuel source (usually scoops of coal) filled. Then came the electric motor, which permitted each machine to have its own power source. This was a dramatic improvement. Efficiency of machines increased, and as automation was added, fewer and fewer people made more and more products. Today, companies have so streamlined the supply chain that materials flow rapidly from step to step, with little delay and virtually no Work-In-Process inventory.

Very large motors and machinery such as those used in power plants or large process industries like oil refineries were fitted with continuous condition monitoring equipment early in the cycle. Like the old line-shaft and boiler systems, breakdowns here were simply unacceptable. Bentley-Nevada led the way with elaborate protective monitoring systems. They continue to sell these large, expensive protective systems. Unfortunately such systems are far too expensive for the average manufacturer.

For widely distributed, smaller electric motors and production equipment, companies like Entek-IRD, CSI (now a part of Emerson Electric) developed a roving data collection device. A person (or several) could make their rounds; collecting data from machine mounted sensors/senders. The collected data was periodically downloaded to computers for analysis after the fact. While this was a great advance over waiting for a machine to break down, it is far from a real time, real world solution. Too often, readings were taken at wide time intervals-as much as 30 days or more apart. The readings provided no way to identify when a machine was running at the peak stress points of its cycle (such as the moment of impact for a stamping press).

The roving data collection system simply provided no way to tell which part of its cyclical stress the machine was exhibiting during the collection event. Then to compound matters, the data was fed into computers for analysis days later, and averages of reading were often used. This system provided minimal information about many impending failures--unless the problems were so severe that almost any data collected, at any time would show it. Even then the time delays between collection cycles and analysis was akin to "closing the barn door after the horse was gone!"

Just as autos went through the stages of periodic maintenance (whether it was needed or not) every so many miles or months, then to periodic diagnosis (but seldom while the vehicle was under any real stress), companies settled on "preventative, scheduled maintenance" and then moved to periodic diagnosis. The idea that servicing key elements of the machine would prevent unexpected breakdown had merit, but it had a serious flaw-it was wasteful and still left far too much to chance. Lubricating a machine with a failing bearing only helped the bearing last a little longer, but it would still fail, often catastrophically and usually at the worst possible time. Diagnosis of a machine with out knowing where it was in its cycle is like checking the drive train of a car standing still with the selector in neutral. It proves little or nothing unless a serious problem already exists. There had to be a better way-and now there is!

Small but sophisticated new companies like MachineXpert have been able to take the best of the technology and learning of the past decade and optimize the cost versus performance of condition monitoring, putting it within the economic reach of millions of manufacturers. What a great breakthrough. Just as our cars no longer require us to watch idiot lights and then guess what to do (they tell us in either text or even spoken warnings), manufacturers no longer have to guess when a key piece of production equipment is about to fail. They can watch its vital statistics and know.

Companies like GE, Allied Signal, and Motorola, who have Six Sigma quality programs, understand that the key to quality is reduction of variation. To know how to reduce variation, first it is necessary to be able to measure and chart the variation in controlled ways. Roving condition monitoring not only fails to satisfy this need, it thwarts such a need by introducing more uncertain variation into the data (uncertainty about the timing of the data collection, its frequency, the point in machine cycle, etc.). Continuous condition monitoring solves these problems as it permits true quality data analysis to occur.

IndustryWeek magazine's America's Best Plants competition documents the value of preventative and predictive maintenance (P&PM) practices. IW's Census of Manufacturers clear shows how much more effective the companies who use P&PM are compared to those who use older scheduled or reactive maintenance. Companies compete based on Quality, Service to customers, Speed of throughput, and Asset management-especially of their inventory.

Statistics show that P&PM users have Quality that is twice as good as non-users. Throughput-time for P&PM users is one-half as long-these companies are fast! Lead-time to deliveries to customers is one-half as long, and with better customer service levels as well. Inventory turns are dramatically better. Yes, that is true--shorter lead times and better service--and with far less inventory. Why--because there are fewer unpleasant surprises-like breakdowns of critical equipment. Among the Best Plants winners over the past ten years, plants who met on-time deliveries in the 95-100% range were heavy P&PM users-85% of them. Conversely, plants that delivered less than 70% on-time were much lighter P&PM users-only 40% of them used these powerful tools.

The Best Plants might be expected to use the best available practices, so how about a larger cross section of plants. Fortunately, IndustryWeek, in conjunction with Price Waterhouse publishes an annual Census of Manufacturers, which gathers data from a large cross section of American manufacturing plants. Annually, hundreds of plants respond, and their results from using P & PM are significant. As shown in the chart that follows, these plants deliver faster, and at a higher service level while maintaining a lower inventory level. These same plants that use P & PM widely are lower cost producers by virtue of higher productivity and lower waste (scrap, rework and warranty costs.) The picture is very clear. Investments in Preventative and Predictive Maintenance pay off-and the pay off is large! This is information any good plant controller will know how to analyze and use to support the necessary investments.

Then why aren't companies investing in it? When financial analysts (and many executives) receive capital appropriation requests for this kind of investment, they balk. There is no old-fashioned ROI calculation for this kind of these new kind of "soft" expenditures. The challenge is for manufacturing executives and their staffs to learn how to show the cost impact of unexpected breakdowns. The cost impact is literally mind-boggling if calculated properly.

A Comparison of Plants Using Preventative and Predictive Maintenance
 Metric  Using None  Using Some   Wide Use
Speed      
On-time delivery  87%  91%  93%
Lead time  42 days  31 days  20 days
Inventory Turns       
Raw Material
 21 22 29
WIP 24 61 51
Waste      
Scrap/Rework  4.5%  4.4%  3.1%
Warranty (% of sales)  3.5%  2.3%  2.0%
Productivity      
Median $/employee  $140,000  $150,000  $160,000
 
Data from IndustryWeek's 1998 Census of Manufacturers

Seriously ill patients in a hospital are placed in intensive care. They are monitored continuously because their life depends on it. Cost is not an issue-saving the patient's life is the issue! Doctors and nurses make periodic rounds, but they are the maintenance mechanics and engineers of the human body's factory. In an era when quality at competitive cost is a given, better service is a competitive must, and speed with flexibility is the key criteria for success, the very life of companies depend on being able to know that critical production equipment will operate and keep operating. Condition monitoring equipment is not an optional expense-it is a critical necessity. Using the most cost effective and focused kind of equipment is just plain smart business. Such equipment is usually beyond the budget approval levels of the maintenance department personnel who recognize its true worth.

This means that the managers and VPs whose jobs depend on consistent, effective performance of their plant and company must understand and support such purchases. The payback is much easier to justify than most people imagine. Simply assign a value per hour for lost sales and overhead absorption to the hours that a key machine, work center, or production line is down, and condition monitoring equipment-at least the cost-effective kind that MachineXpert offers is a no-brainer. It pays for itself. It is almost "free" because of the savings generated in the first year of use.

One of the most interesting aspects of condition monitoring equipment purchases is that they often compete with new capacity purchases in the capital budget-and often lose out. In fact, improved uptime of equipment due to condition monitoring often adds substantially to the capacity of the equipment alleviating the need for purchasing more, new equipment and the plant space to hold it. What an ironic twist.

Once a plant has such P&PM equipment in place, it becomes ubiquitous. It is taken for granted, and companies who now operate with it, wonder how they could ever have operated without it. It reminds you of how we felt about computers. Thomas Watson, the premier builder of IBM once speculated that he wondered how the world could need more than a few hundred computers in all. He would certainly be amazed at the millions of computers and billions of chips being used in today's world. In five or ten years, many companies will marvel that they had to ""justify" the first few purchases of the MachineXpert systems in their plants. The only ones who will not wonder at this will be those who did not make such purchases, because they will be either jousting with the bankruptcy referee or liquidating their used-up equipment.

"If it ain't broke, don't fix it!"-Indeed, what a joke. If it ain't broke, monitor it. Don't let it break. Fix it before it breaks! Many wise men have repeated the quotation "The best way to predict the future is to create it." Maybe they had it wrong-maybe the saying should be "The best way to create the future is to predict it!"

Predictive maintenance and condition monitoring makes this truly possible. After discussing some of these findings with MachineXpert CEO Cecil Presnell, he questions, "If the IW Census data shows that companies who invest in wide use of information from predictive maintenance have better quality, faster manufacturing cycle times, better on-time delivery, with higher inventory turns, why wouldn't many more companies make this a high priority investment?" This is a good question! Why would any prudent businessperson not use such a powerful tool? The only answer must be that they need a "wake-up" call. Smart competitors will provide just that "wake-up" call to those who are slow to recognize these issues.

One of my favorite cartoons shows a battlefield of days gone by. The soldiers are all carrying muskets, and two privates are pulling a wagon with a Gattling gun (an early automatic machine gun) up to the commander's tent. The commander says to them: "I don't have time for new technology-I have a battle to fight!" Maybe too many of today's managers are "too busy fighting the battle". This is a battle they may win, but they will lose the war! To modify another old sayinga"If it's worth doing, its worth doing rightaNOW!"--Before something else breaks down--like your business-and you lose the war!

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The Joys of Talk Radio---John Mariotti Interview on WMAQ Chicago

I had the pleasure of doing a short but lively (3 minute) interview on Friday, July 23 with Lynn Holly on her "Working for a Living" feature on WMAQ radio -- Chicago's largest talk and news radio station. The topic was Negotiation -- a short excerpt on this topic appeared in Bottom Line Business recently.

I have included below the entire pre-edit text of the Industry Week column that generated both of these exposures.

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You don't get what you deserve -- you get what you negotiate!

© John L. Mariotti 1999

The often repeated complaint is "that isn't fair!" Who said life had to be fair? It isn't--at least a large percentage of the time. Those who expect everything to be nicey-nicey and still win in the brutally competitive business environment of the late 1990's are living in a dream world.

All of life is a negotiation. Any one who is married knows that a lot of negotiation goes on in the best of marriages. Teenagers negotiate for the family car or some extra spending money, or permission to go to that marginal rock concert. Why should the world of business be any different?

In corporate life, the annual budgets, profit plans, goals and objectives against which success or failure, even a careers are measured are the result of a negotiation. Perhaps that negotiation went on far beyond your station in life, in some remote board meeting or corporate headquarters--but be assure-- it went on somewhere.

The prudent thing to do is to become an effective negotiator. Negotiation is a learned skill. Some people are naturally better at it than others, but everyone benefits from learning the principles of good negotiation. Reading one of many good books on negotiation is one way to learn. A far better way to learn is to attend a negotiation training workshop where role playing is used. (The Karrass Institute has been doing these for years--check any airline magazine for their ads.)

Until you can make time for this essential personal and professional educational experience, I will pass on a few of the tips you will learn more about later.

There are lots more where these came from, but these are a good start. Two final admonitions are very important.

  1. Make sure the person you are negotiating with has the authority to commit to what you want--if they don't, don't negotiate. You can only give and they will take whatever you give, but cannot commit to what you want. Discuss as little as possible--until the person who has the authority to make the desired commitment is present.
  2. When in doubt--shut up! No one ever made a concession or gave away valuable information when they weren't talking. The Russians were legendary negotiators because they just simply wouldn't talk much, and while the American negotiators kept trying to fill the silence, they were giving away small (and sometimes large concessions) and lots of valuable information as they talked.

Also, in this global economy, never assume the other side doesn't understand your language -- Americans are one of few global powers who are not multi-lingual. English is taught in most other countries as a required language, so your international negotiating opponents likely understand it, even if they do not speak it well or choose to use interpreters.

There is a lot more to becoming a skilled negotiator than these few meager tips. Take the time to learn how to negotiate--remember you don't always get what you deserve--you get what you negotiate!

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This edition--What's new with brands?

There is a lot new and a lot not new in the creation and development of brands. Here is just a snapshot of some of it.

The Three Ages of Brands

The First Age: When brands functioned solely to differentiate a product and less often a service from its direct competitors. Like the early ranchers use of branding, brands on cattle meant nothing more than who owned the cattle.

Objective: Capture as large a share of consumers' wallet as possible

The Second Age: When brands started to detach from and overshadow products and services they represented. Advertising becomes a powerful force. Line extensions abound. Consumers buy brands for status value and identity. (Nike, Harley-Davidson, Polo) Consumers become more fickle and less loyal. Brands become highly valued assets of companies.

Objective: Capture as large a share of consumers' mind as possible.

The Third Age: When brands are becoming increasingly autonomous, providing a device by which corporations are shaping the very ideology of the world! Millennial brands begin to evolve, underpinned by an amalgam of information, entertainment, experiences, images, and feelings. Advertising grows in volume and importance.($39 Billion worldwide in 1950; $256 Billion worldwide in 1990)

Objective: Capture the largest possible share of consumers' lives, and even their souls!

Brand names come from all kinds of places A few people in a back room somewhere say "let's just make something up--it doesn't matter." Wrong! It does matter, and it matters more than ever these days with more brands competing through more media channels than ever for less time and attention span of consumer. It matters a lot! Recall the criteria of the old days--easy to remember, easy to spell and pronounce, hard to be confused with competing products, and so forth. Not a bad place to start.

Of course, some of the original brands were the names of company founders--Sear, Roebuck & Co., and Ford Motor Company are two famous ones. That will always be the case, but those were built over many decades. Who has that much time, patience, and cash flow these days? A brand is sometimes the corporate name of the company who provides the product or service--like Intel or America Online. But these were launched and built at great effort and expense. If I get another one of those stupid America Online discs in the mail, I'll scream. They come in magazines, with newspapers, or with junk mail; why, I even expect to find them in the toilets at airports (haven't yet though)! But, it worked! Persistence and numerous, frequent impressions build awareness, and as you'll see later, few things are more valuable than a brand with strong awareness.

At other times the brand is a descriptive name, which carries some strong connotations about what the product will do--like Pampers or Huggies disposable diapers, or High Endurance deodorant, but never mentions the corporate parent company. These kinds of brands are very effective because their name conveys useful information before you know anything else about them. What kind works for you is a different as all the different markets and people involved.

This is material from the research for my forthcoming book: Smart Things to Know About Brand and Branding, Capstone Publishers, Oxford, UK.

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This edition--Learning how the best plants in North America do it.

Best Plants Keep Getting Better

The gap between the best and the rest continues to widen. As I go through the semi-finalist applications for IndustryWeek's America's Best Plants one thought runs through my mind. These plants are REALLY GOOD! When I compare them to many of the plants I have seen, been through or know about, I am amazed at how large a gap in performance there is between the best and the rest.

The judging of ten finalists out of the 25 semi-finalists seems to get harder each year. For those who want to spend a few bucks to see just how good the best are, IW has produced a benchmark CD-ROM and a narrative "book" written largely by Senior Editor John Sheridan (who also )edits my IW column.

The central characteristics of best plants continue to be highly trained, involved and committed work forces, supported with excellent technology. The newest factor becoming evident is tremendous speed, yet with flexibility and improved delivery service. More and more are making to order--because they can. Those that are not are using some form of mass customization and postponement to wait as long as they can before committing to the final form of inventory.

Information technology permeates these best plants, and extends out to their customers and suppliers. Is it tough to be this good? Sure! Is it worth it? You bet! I can't disclose the kind of returns such best plants generate but they are terrific. Their market position, as you can imagine is also very strong. No time to get started like the present!

Stay tuned to "What's New",

John Mariotti

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This edition--Learning how the best plants in North America do it.

What's Next:

Next edition--The power and value of brands--information from my forthcoming book "Smart Things to Know about Brands and Branding" due out this fall by Capstone Publishers, Oxford, UK.

It is time again for the judging of the top ten manufacturing plants in North America--out of the 25 semi-finalists. For the next few weeks, I will be poring over the extensive applications, in order to see what the best plants do, and how well they do it. Each year the bar is raised higher and the judging gets tougher. The benchmark for best-in-class manufacturing plants is a moving target. At the conclusion of this judging cycle, I plan to add some insights into what makes a "World Class Plant" in this section of the web site.

In preparation for this annual competition, I recently attended IndustryWeek's America's Best Plants Conference at which all ten of the current year's Best Plants winners presented how they achieved their success. There was a strong common theme--success through the efforts of teams of people. This success was not only because the people were in teams, nor because they were equipped with state of the art technology, but because they had developed shared visions of what was to be done; were given training about how to do it; were then allowed to lead their own peers in the necessary actions; and most important of all, accepted the responsibility and accountability for their own future success.

Stay tuned to "What's New",

John Mariotti

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