Lean Sales at Ford and Toyota Good Reminder For Small Business: Beware of PESTs

It’s a bit ironic. Just In Time (JIT) production shaped how Henry Ford would make a car accessible for every family in America. Lean methodology enabled Toyota to compete globally with cars of enviable quality. However, both auto-makers are seeing dramatic declines in sales. Toyota’s sales are down 12% over last year and conditions are worse for Ford. America’s automakers are looking ghastly, frankly. There is nothing Lean or Just In Time about Ford and Toyota at the moment. That they are sitting on an inventory of SUVs is evidence of a complete denial of the facts swirling around them for nearly 4 decades.

Get Environmentally-Conscious…Now (keeping in mind that the environment is much more than the rivers and trees)

The environment tipped these guys off. Anyone old enough remembers that this slump began in the 70’s. Conditions are not new. Fuel inefficiency, OPEC and a recession are a cocktail we’ve had before. The fact that we didn’t do as the Brazilians did and abandon the petroleum-dependent automobile has everything to do with greed and laziness. “If it works, if people buy gas-hogs, why fix it?” Whatever the reason, our largest auto-makers are sitting on a useless inventory of large pick-ups and SUVs while an Indian automaker launches a tiny $3000 alternative and Brazil drives on sugarcane. Europeans whiz around in high-speed trains. Half the world rides bicycles and avoids the encumbrance of an obesity epidemic in the process. All of the environmental conditions around us – political, economic, ecological, trade agreements, wars, and so on – have been pointing in this direction for 30 years. We were tipped off. Some of us practiced benign neglect only now, it’s not so benign. Some of us – the competition – got truly lean and mean. Let the games begin.

PEST Analysis You Can Act On

Small business owners are reminded at a time like this to conduct basic PEST analysis every 3 to 6 months. It can be done fairly quickly but requires tremendous honesty. Is there anything in the Political, Economic, Social or Technological environment that is either a threat or an opportunity? How shall we react strategically? Now act accordingly. That’s how adaptation and survival of the fittest works.

Business Process Adaptations to PESTs

Should there be anything in the environment (PEST) that – honestly – requires us to adapt quickly, can we apply business process analysis to the situation and respond more intelligently? Of course you can.

BPM and Lean – South Beach Diet for Business Vital Signs

Much the same way you have to watch your biological vital signs and stay lean so you can adapt to your environment, your business needs to as well. Failure to do so amounts to neglect. Don’t be a business couch potato. If there is something in your immediate environment you need to adapt to, get busy. BPM and BPA make it easier.

How has your company handled lean times? How are you using BPM to adapt?

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