Running out of waffles

Kellogg's, the producer of Eggo waffles was hit by flooding in September at one of its four Eggo waffle plants.  They had to shut that plant down.  There are three other plants that make Eggo waffles, but the largest shut down several lines for needed repairs.  The articles don't say, but I assume those are planned maintenance / upgrades.  Still, now there are stockouts around the country on freezer shelves.  Kellogg's says they won't restore full inventory on the shelves until midway through next year.

Not sure how much commentary I can add to this story.  My first reaction is wow, midway next year?  Interestingly they've announced that they are dealing with shortages by allocating percentages based on prior sales.  No gaming in order volumes to get a disproportionate share.  Presumably, this outcome suggests that Kellogg's is running a lagging capacity strategy.  In other words, rather than having additional capacity available to support growth (or deal with disruptions) they wait until demand grows to build another plant.  Here we see the potential danger of a lagging strategy.  If demand increases, or in this case a disruption occurs, then there is no slack in the system.  It will be interesting to see what happens to Eggo's market share going forward.  Clearly they'll take a hit over the next six months, but will consumers find they actually prefer other products and not switch back when they have the opportunity?

http://www.npr.org/templates/story/story.php?storyId=120546896

Explaining corruption in Indian trucking industry

Atanu Dey relays a story (below) from a friend that walks through the various layers of corruption in the Indian trucking industry.  Makes clear the challenges of following all of the rules for day-to-day living and economic development.

Atanu Dey - Corruption and Trucking

Project Management Methodologies

In a recent post on his blog, Herding Cats, Glen Alleman talks about Project Management 2.0.  In the post he touches on an extremely important point that I see come up again and again in project management and software development.  Top-down vs. bottom-up approaches are neither good nor bad in and of themselves.  This is not a religious crusade, despite the passion that is sometimes shown by both sides.  Rather, a well-run project will involve rigorous planning and specification alongside a willingness to respond flexibly to the change that will inevitably occur (this describes well-run operations too).  Moving the discussion beyond name calling and buzz words to focus on outcomes and the processes that yield those outcomes is an obvious, but necessary step to improve the practice of project management.

Herding Cats on Project 2.0

Dell & Perot Systems

Dell has finally gotten onto the services bandwagon (well, besides just talking about it).  The move is an interesting, albeit risky one.  The company's fortunes have flagged recently.  It turned out that Dell wasn't the one driving commoditization, but rather Microsoft and Intel were and Dell had a great operating model that took advantage of this.  Now, if you spend a little time with Dell's suppliers you would realize the operating model wasn't quite as good as Dell claimed and rather Dell was using its power to take profits from elsewhere in the supply chain, but that's irrelevant for this post.

So in offering to acquire Perot Systems Dell not only makes a big service play, but does it in two industries (Government and Healthcare) that have quite a bit going on.  While large services acquisitions have a low rate of success Dell will be looking to IBM's acquisition of PWC and HP's acquisition of EDS (to a lesser degree) for lessons.  At Dell it is not just the operating model that is low cost, the whole culture is.  We shall see if Dell can make the necessary adjustments to incorporate a true services business.  All in all, a risky but necessary move on their part.

Dell offers to acquire Perot Systems

NSF Award to Study Virtual Teams and Knowledge Management

Together with my colleagues Amy Edmondson, Katy Milkman, and Melissa Valentine I've just received an NSF grant to study virtual team functioning and their usage of knowledge management tools.  The grant will provide three years of funding for us to study virtual teams in Indian software services.

Grant Abstract

Cisco and Organizational Structure

This article from the August 27th edition of The Economist discusses how Cisco is using project management tools and virtual technology to attempt to rapidly restructure the organization.  As has been the case with most (maybe all) large organizations that I have seen, its matrix structure grew unwieldy.  While the matrix (i.e., having different functional and business reporting structures with some interaction between the two) is great in theory, it is very difficult to pull it off in practice.  Typically, different parts of the organization focus on their individual incentives (not surprising) and so intra-organizational coordination becomes difficult.  The article claims that Cisco is using project management tools to overcome these problems.  It would be interesting to learn more about what they are doing and to see if it will work.


Economist Story on Cisco