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Pay for crude oil with chronic waste
posted by
Suresh Lulla
09 Jun 2008, 19:56
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labels: JM Juran, cost of poor quality, emissions / sustainability, efficiency
Morgan Stanley predicts that global crude oil prices are headed for $150 a barrel by 4 July 2008. We are almost there. Both in terms of price and time.
How will business survive? If business does not survive, how will family units survive?
My yellow hat screams: The world, and more importantly India, is sitting on a gold mine - an opportunity to extract chronic waste from our managerial processes. Quantified, this opportunity is at least 15 per cent of total cost. It can also be as high as 40 per cent! Dr J M Juran referred to this chronic waste as the Cost of Poor Quality (COPQ). The Japanese benefited from his training and consulting on the subject, post Second World War. I wish Dr Manmohan Singh, Dr Montek Singh Ahluwalia and Mr P Chidambaram mandate an estimation of COPQ in every organization – public or private, manufacturing or service, big or small. The numbers are guaranteed to pull the alarms, organization by organization. I believe that we can pay for crude oil (and more) with our chronic waste!
Please do not conclude that I am not advocating austerity. What I am recommending is determined chronic waste reduction through quality improvement. The by-product will be cost reduction. I know it is possible. Qimpro has saved its clients over Rs. 10,000 crore ($20 billion) through Juran’s quality improvement methodology. There is no rocket science to the subject.
The advantage India currently has is that, unlike Japan in the 1950s, we have access to best practices. A means to transform with confidence at speed. BestPrax Club (a Qimpro initiative) has a knowledge base of over 25,000 global generic best practices.
And if you want to interact with Indians who have tasted COPQ-blood please attend Qimpro Convention. Dr J J Irani, Dr R Mashelkar and Mr Navin Agarwal will be there.
A final thought… Survival is not compulsory!
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