Precise optimization….

Posted on January 29, 2013 by Christian Paulsen

“Precise optimization is not necessary. It would be too costly.”

~~Dr. W. Edwards Deming

Lean Leaders balance conflicting goals.

About Christian Paulsen

Christian Paulsen is an Executive Consultant with 20 years of Lean Manufacturing. Chris adds value to organizations by driving process improvement and bottom line savings. Chris intends to help others by sharing the lessons learned after a quarter century of operational leadership, marriage, parenting, and even longer as a Cubs fan. Your comments on this blog are welcome. You can also connect with Chris via LinnkedIn, Twitter, and Facebook in the right sidebar. Chris welcomes your comments. Christian's professional services are available by contacting him through LinkedIn (right side bar)
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2 Responses to Precise optimization….

  1. Dave says:
    January 31, 2013 at 10:35 am

    I want to hear more about this! Too often, we let seconds or pennies drag us places that we may not need to go. What level of granulation would Dr Deming suggest?

    Reply
    • Christian Paulsen says:
      February 6, 2013 at 8:17 am

      Dr. Deming’s advice is to avoid the extremes when it costs you more than you gain. There is some grey area though where it is not as clear cut. You can lose valuable time and money if you continue to dig when you really have enough data to make an informed decision. Moving too quickly on the other hand can lead to uninformed decisions. Sometimes in operations you are forced to make a decision even with only partial information because you are out of time. You do the best you can with the information in hand. When you don’t have a firm deadline, a good rule of thumb is to have 70-80% of the information. With less, your decision is uninformed. You are losing valuable time if you wait too long. At some point, you reach diminishing returns. This is the point at which you would ideally make the decision. In the end, the best advice really is that you have to use your own best judgement. Do you gain more than you lose by gathering more information?

      Reply

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