ENSURING PRODUCT RELIABILITY IN THE WIND POWER INDUSTRY

6th OCTOBER 2009

Quality and reliability seen from above

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The space pen – the U.S. approach

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The space pencil – the U.S.S.R. approach

Hypothesis

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COMPLEXITYkills

quality &RELIABILITY

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Don’t get us wrong…

We don’t hate complexity.

As a matter of fact, we deeply acknowledge and appreciate complexity – and our complex world.

We deeply admire people who grasp complexity and get close to understanding the roots and implications of the complexities in their area of expertise.

Even more, we admire those who can both grasp complexity and implement solutions, decisions and intensions that effectively take an organisation in the right direction – that is less complex.

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Applying complex knowledge beautifully

The world of physics holds beautiful examples of excellent and complex minds that convert knowledge into simple truths:

E = mc2

“Any intelligent fool can make things bigger, more complex and more violent. It takes a touch of genius – and a lot of courage – to move in the opposite direction“.

Albert Einstein

Different complexities

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Complexity of the solution

Complexity of the implementation

Complexity of operation and

maintenance

Complexity of the situation

The relation between the complexities

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Complexity of the solution

Complexity of the implementation

Complexity of operation and

maintenance

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HMS Dreadnought killed complexity

The British battleship HMS Dreadnought was launched in 1906 and it revolutionised warfare at sea. It had such an impact that battleships built after her were referred to as ‘dreadnoughts‘… and earlier battleships became known as ‘pre-dreadnoughts’.

Dreadnoughts were decisive in the famous battle of Jutland during World War I.

Among the innovations that were introduced with HMS Dreadnought was a significant simplification of the guns aboard – fewer guns in all (10) and fewer types (1).

dreadnought = Frygt intet

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Overview drawings

HMS Dreadnought Mikasa

simple pre-dreadnought

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Exercise: Why was HMS Dreadnought a success?

1. Consider the innovation to reduce the number of types and the total number of guns

2. Study and compare the two plan drawings of dreadnought and pre-dreadnought respectively

3. What advantages (and disadvantages) do you see in the dreadnought and its simplified gun-configuration aboard and off the vessel in all aspects?

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Exercise: Why was HMS Dreadnought a success?

Some of the answers:

• Fire control: speed and quality• Stock management: e.g. stock-outs • Bullet logistics – the same for all:

speed and quality• Competencies: skills and flexibility –

also in maintenance• Spare parts: availability and costs• Production costs: Vessel and guns.

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Challenge brilliant new ideas

I have this brilliant idea. Shouldn’t we just implement

as quickly as we can!

Yes, maybe we should – have you considered:

• How easy is it to implement?• After implemented: have you considered

the lifecycle impact in all parts of operations and maintenance?

• What impact it has outside the direct area of implementation?

• Do you think you have enough insight to really judge whether the idea is brilliant?

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Exercise: The tinted windscreen – a brilliant ideaBased on a true story ...

I have this brilliant idea. Why don’t we offer tinted windscreen as an option to our customers?

At an American automaker:

Brilliant idea. Let’s go ahead. Our quick and efficient assessment of the idea says:

• 40% of customers will choose the option• These customers are willing to pay 120$ for the

tinted windshield• The suppliers will charge an additional 8$ for each

unit• Installing tinted glass rather than clear glass we will

assumed adds no labour costs on the assembly line –it’s the same windscreen, just another colour.

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Exercise: The tinted windscreen – to challenge the brilliant idea

If you had challenged the idea and asked these questions:

• What could be answers to the questions?• What complexity challenges could you have discovered?.

Yes, maybe we should – have you considered:

• How easy is it to implement?• After implemented: have you considered

the lifecycle impact in all parts of operations and maintenance?

• What impact it has outside the direct area of implementation?

• Do you think you have enough insight to really judge whether the idea is brilliant?

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Exercise: The tinted windscreen – conclusion

The option of the tinted windshield and similar well meant options added a number of unforeseen complexities especially when looking beyond the direct and variable cost structure – examples:

• On the factory floor work flows had to be adjusted, quality-control tests added and forklifts routes had to be changed – all increasing the production costs

• Purchasing and material-handling costs went up to accommodate the added part• Assembly-line errors crept up as proliferating options made workers’ jobs less predictable• Operating and accounting software became more complex (e.g. new accounting codes)• Workers’ walk and reach time increased because they had to double-check order sheets• Unexpected peaks in demand leading to dips in quality• Forecasting became more complex, resulting in cars with option packages no one wanted

on the dealers’ hands.

So what happened at this American automaker?

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Is it crude to strive for simplicity?

“Simplicity is the ultimate sophistication“.

Leonardo da Vinci

Summary

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Extra slides

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Complexity level(complexity factor)

# of interdependent relations

Shared practices

The Kill Complexity equation is what it is all about

COMPLEXITY KILLER

Efficiency: Do things right

What we all agree upon and do the same way! It is a strategic decision on shared practices.

Common language, shared processes, frame settings etc.

COMPLEXITY DRIVERS

Effectiveness: Do the right things

Interdependent relations = # of customers, employees, suppliers, products, services, projects, countries, sales channels, SKUs, business areas, IT systems, processes, procedures, cultures, management groups etc.

=

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The Kill Complexity equation (the short version)

Controlling complexity

Driving down the complexity factor will drive up the profitability of the business*

Complexity factor =Diversity

Unity

* Please note that coping with a high level of complexity (we name this “strategic complexity” or “chosen complexity”) can be the core of your competition (e.g.100,000 SKU at Wal-Mart).

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Acknowledge complexity – enforce simplicityBoth in projects and as the modus operandi of management groups and organizations as such, we believe in a continuous process of strategizing and executing

STRATEGISE

EXECUTE

Create intuitive simple solutions

Understand your world– insight –

Engage and communicate clearly

Make it happen

HMS Dreadnought

Mikasa simple pre-dreadnought