When we were kids, lots of us had security blankets that protected us from the imaginary monster that lurked under our beds. This practice was generally accepted as something we would grow out of, along with the occasional thumb sucking that added to its power. If we didn’t overcome the habit, the dental bills for correcting our teeth from the effects of thumb sucking could be substantial. Consider that in today’s world of global markets, demanding customers, and fierce competition, similar practices exist in many industries. Many manufacturers are holding on to security blankets that they need to put aside before their own version of thumb sucking puts them out of business.

Every manufacturing operation tries to achieve predictability. Being able to plan and follow a plan has been the dream of many production managers; as well as the source of many sleepless nights for those whose plans went awry, as they often do.

In the days of mass production planning’s goal was high volume efficiency, the cornerstone of Alfred Sloan’s creation of the “industry of industries”: the automotive industry of today. Then, the security blanket was machine efficiency and achieving economies of scale was the dream of every production person; and their worst nightmare was realized when competition from Japan started taking market share.

Toyota altered the landscape by introducing efficient mass production, known as JIT, and a new view of how to manufacture started emerging. As lean thinking, in the form of some derivatives of the Toyota Production System, took hold, it challenged the effectiveness of machine efficiency. In its place predictability and stability were achieved by adhering to a pacing measurement, called “Takt” time.

The purpose of Takt time was to maintain an efficient flow of production, based on careful line balancing so that each operation took the same amount of time. Thus, the hand off from one operation to another was smooth and “efficient”. In Lean, machine efficiency gave way to operation efficiency. A new name perhaps, but the security blanket remained the same, being “efficient”. And volume is still driving decisions in many boardrooms.

Suggesting less efficiency is blasphemous since no cost accountant, production manager, CFO, CEO, stock analyst, or investor worth their salt would support higher costs from inefficiencies. Except that they do without knowing it.

The domestic automotive industry, from Tier two to Dealer, had 2 ½ inventory turns in 2002. Not much has changed because the number of automobiles on dealer lots still exceeds 70 days. In fact, when considering the over production that sits unwanted, true capacity utilization in the automotive industry has been estimated to be less than 50%. None of those “worth their salt” would consider that efficient use of capital. But they have supported even encouraged, greater volume, bigger plants, and more efficiency while racking up over $100 billion in inventory throughout the supply chain along with nearly $50 billion in rebates to try to move the inventory. Many other industries are similarly affected. The “efficiency” security blanket is starting to smell and it may be time to get rid of it. Worse, the thumb sucking practices are entrenched: practices like building to forecast, batching production, building bigger plants, and squeezing costs out of the supply chain without equitable distribution of the profits.

Let’s replace it with something more effective. In fact, let’s replace it with “effectiveness”. Being effective means having the flexibility and agility to respond to changing customer needs without being saddled with the mandate to maintain efficiency. Being effective could save manufacturers the unnecessary investments in capital equipment, raw materials, plant space, inventory, and overhead while increasing responsiveness, customer loyalty, and long term profitability. It could turn unprofitable companies into profitable ones, virtually over night.

Predictability doesn’t have to run counter to effectiveness nor flexibility. Reducing product delivery cycle time in a flexible environment depends on a new awareness of predictability. Instead of balancing through Takt times, create a synchronous flow system that allows for seamless resequencing, disciplined mixed model flow, visual pull signals and a reduced planning cycle to improve responsiveness through agility.

This approach works just as well, and in most cases better, without the rigidity of operation efficiency. Customer demand truly drives the pull system of this type of flexible flow system. Firm planning consists of meeting customer, financial, and resource/material utilization goals while scheduling becomes a simpler version of sequencing control.

Predictability is focused on achieving consistent, predictable flow through one operation on a flow path, usually described as a “pacer” operation. The pacer is not necessarily the known bottleneck operation since, in a flexible, agile operation, bottlenecks move around. In fact, the pacer might not even be in your plant because of how reliant some assembly operations become on their network of suppliers and vendors.

Security blankets are often accompanied by the habit of thumb sucking. If you’re not flexible or if you’re working on efficiency (machine or operation) chances are good you’re a thumb sucker. If you’re not building to actual customer demand, you’re probably a thumb sucker. Are you prepared to face the orthodontist’s bill?