Scott Sedam: Consider true value before switching suppliers or products
Twenty years ago, there was a project in Denver where the foundations began moving, to the point that several new homes had to be taken completely down. In the milder cases, the builder had to sink caissons next to the foundation as deep as 40 feet to stabilize them. The problem was expansive soils.
The local team for the national builder had decided that their previous soils testing outfit was too expensive so they went with a new, untested firm, who in retrospect was clearly "buying the business." They compromised both on quality and frequency and many of the tests were suspected of being fraudulent.
After several years, the total bill for the repairs was just short of $7 million (in 1980's dollars) and the great unknown and unknowable cost was a severe blow to the builder's reputation. By that time, however, the management team had long since spent their bonuses and left for other locales. The soils testing outfit shut down. The customers were left holding a bag of ... uhhhh ... bad soil.
Lean is never about cutting cost alone, in a vacuum. It always considers value to the customer, or another constituent in the process – an internal customer. Skimping on soils testing in this case was clearly not a case of eliminating waste. These tests contributed tremendous value, as the builder learned the hard way.
Join the discussion with the “Lean Building” group on Linked In. Just click on “groups,”enter Lean Building and click on “become a member.” Post your examples of waste and waste-mistaken. The discussions are revealing and educational.