TO:

Program Participants

FROM: David A. Shore

RE: The Shoemaker’s Children Syndrome

I am very much looking forward to our discussion surrounding the teaching case, “The
Shoemaker’s Children Syndrome.” Please become familiar with the case substance and
determine central issues in advance of the session.

As current and future leaders, you fully appreciate that improving operational efficiency is a
Critical Success Factor (CSF) for every organization. During our session small groups will engage
in a virtual waste walk relative to the organizational use of business meetings. Teams will
discuss the seven wastes and work through the waste audit instrument. Since the descriptions
provided of the seven wastes are quite limited, you are encouraged to do some background
reading on each waste as you deem necessary.

One CSF for every change initiative is overcoming the natural resistance to change. Teams
should consider this in both their analysis and recommendations.

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The Shoemaker’s Children Syndrome

Mr. Seymour Derroche emerged from the Thursday morning leadership team meeting with an
epiphany. As always, the first item on the agenda for the weekly two hour meeting was a
financial update. This one reflected a recent downward trend that was concerning to the entire
team. That’s when it hit Seymour; the shoemaker’s children have no shoes!

WasteFree Resources (WFR) was founded five years earlier to assist not-for-profit organizations
in driving out waste and inefficiencies using such methodologies as project management and
Lean. Despite extolling the virtues of these and other tools to their clients, WRF had not
applied the same techniques to their own growing company. Too many in the company did not
understand that Lean is at once a methodology and a mindset. It is a continuous improvement
approach that seeks to maximize value throughout an enterprise. The irony of this was not lost
on Seymour. After all, Frederick Winslow Taylor had begun worrying about inefficiencies of this
kind in factories more than a century ago. Fast forward a century and we have rich data
showing that billions are spent annually on “unnecessary services,” which increase costs
without increasing benefits. That is the very definition of waste - any activity that consumes
resources (adds costs) yet does not add value to the products and services that the organization
offers its customers. Of course, “unnecessary services” are just the tip of the wasteberg. Many
forms of waste and poor quality are not as readily apparent as overuse, and may lie below the
surface; most notably underuse, misuse, and administrative waste. In Lean, the first big learning
is that we are all responsible for identifying waste wherever we see it and working to eradicate
it. Stewardship of WasteFree’s resources must be a key concern of the management team, and
now there is pressing need. The time had come to pay serious attention to operating efficiency.

While WRF’s services were in strong demand and top line revenue continued to grow at an
annual rate of 8%, they were having difficulty controlling operating costs. The leadership team
could no longer just admire the problem – costs were rising more rapidly than revenues. As
COO, Mr. Derroche was convinced they could not “grow their way” out of this situation, as his
colleague CMO Jane Excess had suggested. The options were clear – either reduce waste and
inefficiencies or face the very uncomfortable thought of having to implement staff reductions.
No one on the leadership team wanted to cut FTEs.

______________________________________________________________________________
David A. Shore prepared this case. The case was written solely as the basis for discussion.
Cases are not intended to serve as endorsements, sources of primary data, or illustrations of
effective or ineffective management.

© 2018. To request permission to reproduce materials, contact dshore@fas.harvard.edu. No

part of this publication may be reproduced, stored in a retrieval system, or transmitted in any
form or by any means – electronic, mechanical, photocopy, recording, or otherwise – without
the written permission of David A. Shore.

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It was time for WFR to turn the mirror on itself. Seymour scheduled a meeting for the following
Monday with Mr. Tim Wood. Tim has been with the company since its inception. As a senior
consultant, he had personally helped more than 40 organizations reduce waste and improve
operational efficiency. Seymour was convinced Tim was the right person to lead a similar effort
within WFR. After all, as a small but rapidly growing company, everyone had skin in the game.

The following Monday Tim Wood sat across from Seymour Derroche. He listened carefully,
taking a considerable amount of notes as his Chief Operating Officer outlined the current state
and shared his vision for a desired future state. It was nothing Mr. Wood hadn’t heard before.
However, this time it was very personal. It was also surprising. All 16 WFR consultants were
fully engaged with clients year-round. Therefore, Tim knew the revenue was coming in, he just
hadn’t considered the notion that it might be going out faster than it was coming in. After a 20
minute introduction, Seymour paused and said to Tim, “I want to cut the fat, not the bone.”

As the seasoned consultant that he was, Tim did not hesitate in his recommendations:

1. Assemble a cross collaboration team for the sole purpose of cutting the fat
2. Provide the team with an orientation to the seven wastes - the centerpiece of Lean
3. Train the team in the use of the identifying and eliminating waste audit instrument
4. Conduct waste walks in which the team members visit and observe various departments
and functions

Seymour reflected on Tim’s game plan. He loved the idea of a cross-functional team since there
was no doubt in his mind that waste could and would be found enterprise-wide. Because the
team would include primarily back-of-the-house employees, perhaps from such departments as
finance, marketing, and/or IT, there would be a clear need for some targeted training. The
staff really did not know very much about the WFR’s core business - the actual strategies and
tactics Tim and his colleagues used in the field. It all made perfect sense. There was just one
catch. Seymour didn’t think the company could afford to take the three months that was the
median length of a typical WFR engagement. Nor could they afford to take Tim out of the field
and generating revenue for the company for that long. Once again Seymour thought about the
leadership team meetings – 7 executives, meeting for 120 minutes, 48 weeks a year. He
wondered what the hidden costs of just this one meeting were to the company. Was it worth
the cost? In other words, did it add value? And of course, as a consensus-driven organization,
this was just one of many meetings he and all his colleagues attended. Seymour was getting
anxious – nervous and excited - just thinking about the scope as well as the potential impact of
this change initiative.

As the time scheduled for their meeting was coming to an end, Seymour told Tim he would
really like him to take on this mission-critical project; only not as a full scale engagement. It
would begin with a pilot - initially limited to identifying and eliminating waste in WFR’s many
meetings. Further, while waste walks typically have you go to the source to see firsthand
where the action occurs, Seymour wanted to report back to the leadership team in two weeks.
He asked Tim if he could accomplish this. Tim nodded in the affirmative, though knew he
would need to severely limit the scope of the work, carefully guard against scope creep, and

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virtually eliminate the creative incubation period. He also knew that many of the GTD (Getting
Things Done) rules of time management would have to be deployed.

During week one, he identified potential project team members and confirmed their
participation. As part of the onboarding process, he sent each a brief overview of the seven
wastes (Appendix A). The group would be taught that eliminating the seven wastes is
fundamental to becoming Leaner. Since many people find it difficult to distinguish between
the different types of waste, Tim planned a brief orientation with ample examples. The team
also received the waste audit instrument (Appendix B) WFR uses with its clients, and that they
would now be using in-house. On this one Lean waste walk template they would be able to
generate a list of possible wastes and recommended resolutions. Now came the creative part.
It is a maxim of Lean thinking that to fix any problem you must first see the waste. A waste walk
is one way to make the waste visible. While they would not have the luxury of a more
comprehensive training session nor of conducting the standard field work; Tim knew that all the
team members had logged countless hours in meetings. Therefore, the workaround would be a
virtual waste walk. Tim had used this method before when a team could not easily do an actual
walk due to the geographic dispersion of the team. The group could reflect on their collective
meeting experiences and review their meeting files (i.e., agendas, minutes, action items,
reports). While he knew that nothing would substitute for being where the action is, this would
simulate being in the field.

The following Tuesday the group convened armed with their collective experience stimulated
by a data-driven virtual memory waste work of meetings at WFR. With the benefit of Tim’s
roadmap and mindset, they spent the entire meeting identifying and sharing probable waste
and recording possible strategies and tactics to eliminate the waste. It was a very fertile session
in which all members contributed greatly. For example, they concluded that when it came to
meetings, peppered with pockets of excellence there co-existed enormously variable
performance across the organization. As one team member observed, “if you have seen one
meeting, you have seen one meeting.” Another team member commented that while some
companies benefit from Just in Time processes, we seem to have “Just in Case” meetings.
However, there was also consensus among the project team members that issues identified
through their waste walk were not a consequence of bad people, but rather of bad systems.

While there would be no shortage of recommendations, Tim felt he could connect the dots for
the leadership team by framing them under the umbrella of a triple meetings aim for
WasteFree Resources: fewer, shorter, better. The real question was could WFR manage the
change and make it stick? There was no time to waste. Tim Wood’s presentation was second
on the agenda at Thursday’s leadership team meeting.

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 Appendix A

The Seven Wastes

Transportation – Unnecessary transportation of parts, documents, and materials from one

location to another. Includes handoffs and transfers.

Inventory – Any materials that are retained for any length of time, inside or outside the
organization. Includes people waiting in a queue.

Motion – Unnecessary people movements and journeys not necessary to perform a task or
operation. Includes travel, walking, searching.

Waiting – People waiting for things or information to arrive. Information waiting for people to
arrive. Incudes waiting for any type of work or approvals; as well as parts, materials, tools,
equipment availability.

Over-processing – Any operation or process that may not be necessary. Trying to add more
value to a product or service than what stakeholders may want, need, or being willing to pay
for. Includes redundant or unnecessary processing.

Over-production – Creating products and services that are unnecessary, faster than is
necessary, when it is unnecessary, and in unnecessary amounts.

Defects – Not doing it right the first time. Rework or scrap because of errors in a previous
process. Any aspect of a product or service that does not align with stakeholders needs.
Includes defects, the cost of inspecting for defects, responding to stakeholder complaints and
making repairs and corrections.

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 Appendix B