The Tale of the Air Conditioning Manufacturer

Once upon a time there was an air conditioning manufacturer. The engineering team at the manufacturer had lots of engineers. They were all very smart.

A different mechanical engineer was responsible for the design of each of the subcomponents in the air conditioners. When an engineer needed a fastener, such as a bolt or screw, for his component, he would pick the best possible fastener for the job. It would have just the right tensile strength, length, diameter, thread count, etc. As a result, an air conditioning unit might have hundreds of different types of bolts and screws. And every one was happy.

One day, a new head of engineering arrived. He looked at what the engineers had designed and made a declaration: “I want you all to redesign this air conditioner so that it has only one type of screw. If the screw is too strong for that connection, I don’t care. If the screw is too weak, then use two of them.”

Needless to say, there was much grumbling and discontent amongst the engineers. They knew their components better than anyone. They had worked hard to pick just the right screw for their particular part. Now this new guy was asking them to compromise their very smart design.

It took much cajoling and threats, and some old engineers even quit, but eventually the team did what the new head of engineering asked, and the results were amazing. Assembly line delays dropped. Field support costs dropped. Inventory costs dropped. Millions of dollars went right to the bottom line, that is, profit!

The supply chain is only as strong as its weakest length. If you run out of one novel screw for one subcomponent, your assembly line stops. If you are in the field working and you do not have every type of novel screw, then you cannot complete your job.

By optimizing the components, the engineers were compromising the system as a whole. By compromising the subcomponents, the head of engineering optimized the system as a whole. The system is not just the machine. It is also the logistics, manufacturing and field support they create and maintain the machine.

The moral of our story is: The essence of engineering is to compromise rather than to optimize.