The Cost of Commitment: Everything has a price

Puzzle: In an English breakfast of bacon and eggs, who is more committed? The pig? Or the hen?

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Commitment in the clouds

Organizations desire commitment at all levels. But how do you get commitment for quality from the top management? It isn’t that they are not committed. What I mean is committed-committed. The Chairman of a large steel company in the 1980s, resisted any formal quality intervention on the grounds that even the 3 percent seconds (read – rejects) of the plant had a pent-up demand. Is seconds an opportunity or a threat? By translating the 3 per cent seconds into the language of top management, the opportunity converted to a threat. The alarm for 3 percent seconds was 30 percent of total cost! This is referred to as the Cost Of Poor Quality.

Money speaks all languages

The Chairman compared that figure with his profit. He instantly became committed to drastically reducing the seconds. He assembled other members of the top management and declared a war on waste! The Commander-in-Chief was none other than the legendary Managing Director. All the rank and file from all functions stood committed to the declared war (cause). Why had the Chairman not seen it this way before? Ten years later the company became the lowest cost steel producer in the world. A further decade on, it acquired a steel giant in the UK and, through the distinguished leadership of Chairman of the Group, the UK giant is today a turnaround story, importing the best practices from the Indian parent company.

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Finally, the answer to the original question on commitment is – the pig! He sacrifices his life.