Root Cause Analysis Blog: Will you come out of the financial crisis on top?
30 October 2008 - This space will be used to talk about the impact the current financial crisis is having on the choices organizations will make in the next few months.
Because of the financial crisis, one could make the argument that it's a time for retrenchment - keep short term costs as low as possible by focusing on short term priorities. Don't worry about preventive maintenance except on the most critical assets. Halt process improvement efforts that aren't expected to yield immediate results. Put off training, at least for now, until a time when the outlook is decidedly better.
Of course, the argument could also be made that there is no better time to maintain focus on what Stephen Covey calls Quadrant 2 activities... those efforts (like root cause analysis) that are important, but not yet urgent. If an organization loses focus on these types of activities, it will only be a matter of time before they start spending an exorbitant amount of energy fighting fires.
Two years ago, I was in pursuit of what would likely have been a very prominent client. While they would have likely been a medium-level client in terms of revenue, their brand is famous and would have been a great addition to our client list. They decided to forgo any investment in RCA training because, and this is a direct quote from the manager working with me: "We just make too much money - the savings really isn't that exciting." Today things are very different for them - and I can't help thinking about how much better off they would be had they made a long-term commitment to improvement.
If anything is certain, it's that things are going to change. This financial crisis wasn't always with us - and it won't continue indefinitely either. It's our opinion that companies should maintain their commitment to root cause analysis - both training and investigation. Those that do so will certainly be in a more favorable position once things do turn around - and may have RCA at least partially to thank for helping them maintain their leadership position.
What do you think?
Author: Brian Hughes, Apollo Vice President
Comments
Brian's comments hit pretty close to home. We have seen capital spending pull back a little, discretionary spending has been halted, and budgets cut. Reliability is sure to suffer. It's at times like these that RCA is most critical. When we know that spending money to solve problems will be difficult to support, RCA can be used to find knowledge-based solutions to some of our pressing problems. It may require more time in solution generation and may require a broader audience to come up with several creative, low-cost solutions, but it will help keep us moving forward when others have admitted defeat.
Posted by: Mike Mastic | November 11, 2008 at 10:38 AM PST