Managers should focus on growing, not running, business

Published on December 18, 2012

Managers should focus on growing, not running, business

By Kelly Anderson

Published by The Providence Business News

Kevin J. Duggan says he sees the whole picture when it comes to how to grow your business. Now he wants other companies to get the same view too. Duggan’s recently released book, “Design for Operational Excellence: A Breakthrough Strategy for Business Growth,” published by McGraw-Hill in September, does just that for companies, he said. In his third book, the first to be published by McGraw-Hill, Duggan outlines the concepts needed to grow your business, including eliminating management positions and using more of a team-based approach.

PBN: Why did you feel the need to write this book?

DUGGAN: Because I’ve been teaching companies for the past 12 years or so about … how to improve factory operations, how to make factories lean. All with the end result of lowering cost and being more competitive. And then one day … I was working with a CEO and I kind of realized something, that you could probably be the leanest, most cost-efficient factory in the world and it doesn’t do a company any good unless you keep getting orders and unless you keep getting market share. And that’s when it dawned on me that everybody’s out there trying to teach people how to cut cost and everything, but what are you going to do if you have this low-cost, perfect-quality product and the customer looks at you and says “yeah you got perfect quality, perfect delivery, everything is good except for one thing: We don’t need your product anymore.” And then it dawned on me that I had been teaching these companies half the story. I need to be teaching the whole story. And the way that whole story works, because I’m an engineer, I teach a process not just recommendation ... so then I added onto it, this is how you can add onto it and design a factory that will make it grow your business. So I began teaching operational excellence.

Stop trying to solve problems and start trying to teach them concepts. … The secret in all of this is not to look too hard at the labor cost, which is where most companies look.

PBN: Are you specifically talking about factories or a factory-type model?

DUGGAN: That’s my background coming out. I use the word operation, [which] means from the time the customer give us a request for something and until they get their delivery back. I use factories because it’s visual, you can see that in your head. But it can be any operation, it could be a hospital from the time a patient walks into the hospital until the time a patient leaves a hospital cured. It’s all the services and materials in between until the end.

PBN: It seems like it’s a simple concept, why don’t businesses get it?

DUGGAN: Because they’re managers. Because we’re brought up to be managers, brought up to control, brought up to direct as managers. And the way that this whole factory works is the last thing you want to do is be a manager in it. Do the people building the product understand the customers and understand the flow to the customer? This whole concept is of the people building the product running the factory. Managers are really not needed. Take your experience out of the factory and put it in front of the customer and there’s a whole process in how to do it. The irony is that so many books are written on leadership and management. And that’s the one thing that the Design for Operational Excellence is trying to say: It’s nice and everything but … management should be worried about growing the business, not running the business.

PBN: What challenges were you presented when writing the book?

DUGGAN: I had the challenge of finding the right voice to write the book so that it wouldn’t be overly technical or too light and the chapters actually connected and made sense. When I first met with McGraw-Hill they really educated me on what makes a good read. For example, if you read the first couple of pages – that chapter was way in the middle of the book. They said, “you take four chapters to get to the heart of story, just jump into it.” So I said, ‘I’ll give it a shot,’ and I rewrote it and it was like, within three pages you get what the book’s all about. They didn’t tell me what to do they just said I needed to get to the subject quicker. That kind of built the writing mode.

PBN: What is the best, simplest advice that you could give to Rhode Island businesses to help grow their businesses in this current economic climate?

DUGGAN: The best advice I can give is, do what I did. At two o’clock in the afternoon, I put my head down on the desk and I looked at the clock and thought, it’s two o’clock in the afternoon and all I’ve done is worked on defense, worked on calling people around the company to find out who did what, who was where. Ask yourself, how much time in my day is spent on growing the business versus running the business. And then if you want to do something about that, get your employees together and ask them this question: What activities should I, the owner, be doing on a daily basis? And give them all a bunch of Post-it notes and have them write one activity per person and put them on the whiteboard and arrange them into categories. I think that you will find that no one will write down [that] you should be signing off on reports, or you should be following up on the status of something. I think they will say you should be calling up potential new customers looking for ways to grow the business.