Volume 6 Number 2 - February 12, 2008
 

The Finish Strong™ monthly e-newsletter helps business leaders examine issues important to taking operational performance to world-class levels. Do your Operations deliver your company's espoused brand promise to every client on every order?

Finish Strong™ is about developing an appropriate Operations strategy, and effective execution, dotting operational i's and crossing operational t's as you go.

Your company cannot afford to be sloppy if you want it to be great.

THE DOW JONES INDUSTRIALS

Next week the composition of the DJI will change. These changes happen infrequently, every few years at the most, and with little fanfare. The top editor of the Wall Street Journal, published by Dow Jones, determines any changes to the list of 30 companies that makes up the DJI. He is certainly aware of the number of financial instruments that tie to the DJI, and one would hope appropriately cautious about making changes. But this is also a case where no change can be higher risk than change.

The companies becoming part of the DJI next week seem to make sense. Bank of America and Chevron are joining the group of 30, while Phillip Morris and Honeywell step off. No one will argue that banking and energy are less important than tobacco and Honeywell is simply too small to warrant ongoing inclusion.

As we look at the changing composition of our economy, it is worth noting that the only company to remain part of the DJI since its 1896 inception is General Electric. It is also worth noting that while changes to the Consumer Price Index and Producer Price Index and other government generated statistics undergo extensive statistical analysis and testing before changes are made, the DJI composition must only pass an eye test by a single individual. Not that he doesn't think about it first; just that he gets to decide. I wonder if Rupert Murdoch has any input now?

It's important to understand the metrics that we watch and use to drive action.

THE CHRYSLER SUPPLY CHAIN

The new leadership/ownership of Chrysler recently decided to play hardball with a key supplier, shutting down several Chrysler plants as well as a few domino-affect suppliers in the process. The headlines came and went, but the issue is not dead.

A statement to the entire supply chain? A red herring to reduce inventory and improve cash flow without union interference? Or is it possible that John Campi, Chrysler's new EVP of global procurement direct from Home Depot, doesn't consider the fully integrated nature of automotive's supply chain in any way more appropriate than the more line-by-line approach of the Big Box stores?

We knew that private equity ownership of one of the Big Three would shake things up. This may well just be the beginning.

 

 
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