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Richard Schonberger, in his third and most
important book yet, introduces a powerful new concept: that
the many links between and within the four main business
functions -- design, operations, accounting, and marketing
-- form a continuous "chain of customers" that
extends to those who buy the product or service. Everyone
has a customer -- the next department, office, shop, or
person -- at the hundreds of pioneering companies Schonberger
has studied throughout the world.
Schonberger demonstrates the universality
of customer wants: Both the next and final customers want
ever better quality, quicker response, greater flexibility,
and lower cost. This condition provides a common strategy
and calls for common methods to be used across the organization.
Every employee is a data gatherer and analyst, unearthing
more and better ways to provide for these customers' wants
-- before the competition does so.
As the new thinking and methods permeate
every corner of the firm, they topple departmental walls
and adjust gang-like mind-sets and "them-versus-us"
attitudes. Performance is no longer measured by internal
costs but by improvement as seen by the next customer; direct
control of causes generally replaces after-the-fact control
of costs. Design is brought out of isolation. Finally, with
the rest of the firm reoriented toward customer service,
marketing escapes from a "negative" mode -- covering
up for failures -- to a positive one -- crowing about the
firm's competence and ability to improve.
With the close attention to detail for which
he has become famous, Schonberger constructs a blueprint
for unifying corporate functions, brilliantly describing
the new microcosms that will make up the company of the
1990s -- focused teams of multi-skilled, involved employees
arranged according to the way the work flows or the service
is provided -- that compose the chain of customers. Aetna,
for example, is organizing customer-focused teams that cut
across underwriting and the administrative functions. At
Hewlett-Packard, teams of marketing, manufacturing, and
R&D people have already gone through several iterations
of "activity-based costing," which provides product
designers with previously unavailable data for shaving costs
throughout product life cycles. And at Du Pont, even production
people on the factory floor are involved in assessing competitors'
product quality and probable costs and methods. Through
these and hundreds of other real company examples, Schonberger
shows how the customer-driven chain of action leads directly
to the kinds of bottom-line performance that have been so
elusive to executives who manage at a distance "by
the numbers" -- namely, higher profits, greater security,
and gains in market share at the expense of the laggard
competition.
Richard J. Schonberger, author of the
best-selling Japanese Manufacturing Techniques and World
Class Manufacturing (also from The Free Press), is a world-renowned
authority on production and manufacturing. President of
the consulting firm Schonberger & Associates, Inc.,
in Seattle, Washington, he was formerly George Cook Professor
of Management at the University of Nebraska.
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