Home > The Monday Musings Column > Trick or treat? Some skeletons from the closet…

Trick or treat? Some skeletons from the closet…

Keeping up my Halloween tradition of talking about things that went bump in the night, here are a few more oops moments that I learned from. Maybe they will help you avoid similar mistakes.

One classic is not really mine, but just goes to show how easily things can go wrong. It involves a warehouse that I managed in my logistics days and for which we had taken on maintenance responsibility from the landlord. The external cladding needed sandblasting and re-painting every 5-7 years and this came due a couple of years into my tenancy. I looked beyond the obvious and found an insulated cladding with a 20-22 year life between maintenance and, with the agreement of the landlord, had the existing material replaced. The new stuff cost £500k against a re-paint cost of £200k, but with a life expectancy of around four re-paint cycles plus the energy savings from six inches of insulation we were quids in.

Circumstances saw me move on, but the business that took the site over later became a client and about seven years later I called on them only to find that scaffolding was up around the warehouse. Enquires revealed that the landlord was doing the the periodic re-dec! A check of the site manual clearly showed that my project had gone ahead and that a re-dec was not needed so I made a call, but too late to stop a project that, at current values, was not only costing £300k, but had also destroyed the long term integrity of the surface. What a waste, even if it wasn’t my money anymore, and all because no-one bothered to check the manual. Lesson learned; it doesn’t matter how careful you are to communicate through multiple channels there will always be someone who just carries on regardless.

Also from my logistics days we had a need to make improvements to a small parts picking process and I had the opportunity of 15 people all due to retire over a two month period. Investing in some new technology would mean I could just lapse the jobs of those retiring and re-deploy people. Off we went to tender and the winning bid suggested that we needed two pieces of equipment instead of the three that we thought that we needed (and could afford).

The arguments were convincing and we contracted for two machines, but were not far into the switch over before it became apparent that we needed four. How did it go wrong? We never did quite bottom it out, for although the contract placed responsibility on the supplier to give us the right solution, in getting the drains up there was some ambiguity in what we had told them. The bottom line was that these were bespoke machines costing £25k each, so this was a serious issue. In the end we agreed to split the difference; I bought one extra machine and got one free and we agreed to do some supportive PR for the supplier. I had budgeted for three anyway, and the project, once we had got past the cock-up, was a great success. So much so that the company regarded as the benchmark in small component supply in the UK asked to send a couple of their guys to study what we were doing. Lesson learned; you really need to bottom out why numbers don’t match. It isn’t about a lack of trust, it’s about being sure that you understand, and sometimes the same terminology can mean different things to each party.

There was another twist in this project. Although we were perfectly qualified to do our own buying we were already both specifier and end user for this purchase and so, to comply with the need to separate powers for probity reasons, I asked the corporate purchasing team to handle the tender and contract award. There were only three companies in the UK who could do the job and we checked where to send the tender invitations. On the closing date only two responses had come in; one of the two front runners did not bid, so we went ahead with the best offer of the two we had in accordance with corporate rules.

A couple of months later we found out why they didn’t bid. Corporate purchasing had placed a number of contracts with them for another part out the group and had an address on the newly created supplier database, but that office had been closed. Although the buyer had received a letter about the change and had updated her Filofax, the new fangled computer had not had its records changed. They didn’t get the tender… Lesson learned; always check the detail; we had had copies of the tender, but we didn’t notice that the one address differed from the one we had provided.

 

 

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