A Heijunka Economy

As summer officially comes to a close in the United States this weekend with the kick-off of the American Football season and something Americans call Labor Day, I find myself thinking about heijunka (averaging of both your demand volume and product mix to smooth out production). As a small business owner I find summer a disruptive time with clients taking vacations and factories shutting down. Consulting work is generally slow in July-August. This is compensated for in September-December. This is not Lean.
A certain amount of seasonality of business is caused by nature. There are the four seasons which change the weather and therefore consumer buying patters. We buy air conditioners in the summer, leaf blowers in the autumn, heavier clothes in the winter, bulbs for your garden in the spring.
The producers who build and ship product to meet the demand during these peak periods either have to ramp up equipment and labor capacity to meet peak demand or have enough year-round capacity, some sitting idle in the slow seasons. Unless you can find southern hemisphere markets or other offsetting business, nature-caused seasonality is inevitable.
Then there is seasonality caused by humans. The demand peaks include chocolate in February, Easter bunnies in April, fireworks in July, school supplies in September, candy in October, turkeys in November, and a whole lot of stuff in December. These are just some of the examples based on U.S. holidays and traditions.
So here’s a big idea: study the macroeconomic effects of the various human-caused demand spikes in the United States economy. Identify the impact that smoothing out these demand swings would have on the overall economy in terms of factory capacity utilization, inventory reduction, reduction of costs associated with hiring and training seasonal workers, utilization of aircraft capacity of airlines, and so on and so forth. In order to achieve a heijunka economy there may be a business case for a national policy to observe holidays on different dates by region, for example. Stranger things have happened.
These holiday buying patterns are good examples of “fixed ideas” or paradigms that we encourage people to bust through when doing kaizen. If you ask “Why do we as consumers buy so much __ on __?” many times you will find that this is simply learned behavior and has little or nothing to do with things we hold dear, such as values or beliefs. A study of history will show that many of these seasonal buying patters were intentionally fabricated by the people who are selling to us. We can change this, and get closer to a heijunka economy.
The practical lesson here is to first examine your strongly held assumptions whenever you are doing kaizen. Toyota calls this “thinking deeply”. Taiichi Ohno said that you need to think of ten-fold improvement, not 10% improvement to really get the picture of the current condition and find ways to do kaizen. This forces you to question certain “fixed ideas” you may consider untouchable when looking only for 10% improvement.
How many of us who are salespeople intentionally or unintentionally cause non-leveled buying behavior on the part of customers? The so-called “hockey stick” or month-end / quarter-end rush of demand isn’t caused by nature. I’m still thinking about how to kaizen Boxing Day… but I think I’m getting closer.

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