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What are your brown M&Ms? Van Halen's early warning techniques to discover operational problems

Dave Brooks's picture
by Dave Brooks in ARIS BPM Blog posted on 2011-12-15

I used to be in a band in New York City.  Tried to land a record deal… didn't get it. Tried to get some of our songs in movies and television… actually had some success.  Somehow I found my way to the intersection of Business and Software.  So what do rock music and operational excellence have in common?  Read on!

Back in the 80’s, Van Halen took over the world, fueled by the guitar wizardry of Eddie Van Halen and the stage antics of singer David Lee Roth.  Some of you may also remember the story of the brown M&M's.  Starting with their 1982 World Tour, Van Halen included a special clause buried deep in their contract called Article 126. It read, "There will be no brown M&Ms in the backstage area, upon pain of forfeiture of the show, with full compensation."  Initially this may sound like the band was a bunch of rock star divas… especially after hearing that David Lee Roth found some brown M&Ms at a venue in Colorado and had “$12,000 worth of fun” destroying the dressing room.  But the story goes much deeper than that, and offers a framework for businesses to improve their operations.

Van Halen was one of the first “mega-bands”.  Performing acts of that era would typically require three tractor-trailers of musical equipment to travel with them from town to town.  But Van Halen did everything in a BIG way.  The band had nine tractor-trailers that hauled their stage gear.  The complex staging required exacting specs from both an electrical and a structural perspective and the safety of the band, its crew and the fans was a top priority.  On top of that, every venue – especially the smaller towns – had its own local crew that set up the stage for each performance, and it doesn’t take a six-sigma black belt to point out the inherent variability with this approach.    

Rather a 3rd-party view of the brown M&M story, here’s the explanation from “Diamond Dave” himself from his 1997 autobiography:

“Van Halen was the first band to take huge productions into tertiary, third-level markets. We'd pull up with nine eighteen-wheeler trucks, full of gear, where the standard was three trucks, max.  And there were many, many technical errors - whether it was the girders couldn't support the weight, or the flooring would sink in, or the doors weren't big enough to move the gear through.  The contract rider read like a version of the Chinese Yellow Pages because there was so much equipment, and so many human beings to make it function.  So just as a little test, in the technical aspect of the rider, it would say "Article 148: There will be fifteen amperage voltage sockets at twenty-foot spaces, evenly, providing nineteen amperes . . ."  This kind of thing. And article number 126, in the middle of nowhere, was:  "There will be no brown M&M's in the backstage area, upon pain of forfeiture of the show, with full compensation."  So, when I would walk backstage, if I saw a brown M&M in that bowl . . . well, line-check the entire production.  Guaranteed you're going to arrive at a technical error.  They didn't read the contract.  Guaranteed you'd run into a problem.  Sometimes it would threaten to just destroy the whole show.  Something like, literally, life-threatening.”

Life threatening indeed.  With all the potential for things to go really wrong, the simplicity of a brown M&M in the bowl was – at the risk of referencing The Police – the band’s canary in a coal mine. 

 

Now this story has been bouncing around the Internet for several years, and other than being an entertaining anecdote, here’s the real question for us: “What are our brown M&M's?”  What early warning signals and error predictors can we put in place to alert us that the train might be coming off the rails and immediate corrective action is needed?

 

In the corporate world, there’s a potential for all kinds of brown M&Ms.  I had the opportunity to compare thoughts with a few companies following a presentation I gave at a recent supply chain show in Dallas.  For those of us who focus on supply chain, here are a few ideas:

  • Tracking whether or not an advance ship notice (ASN) has been sent to, or acknowledged by, the customer.  Information needs to arrive before the goods, simple as that.  And real-time alerting is key for these kinds of indicators: Everybody Wants Some!
  • Production runs scheduled for material destined for obsolescence…  You’re No Good if you’re making and storing an excess of material that you won’t ultimately be selling, which only increases the likelihood of inventory write-offs (your CFO will thank you for avoiding this pitfall).
  • Real-time Inventory discrepancies between your ERP and Warehouse Management System.  Not only can this visibility have a positive effect on your fill rates, but now you’re not trying to pick, pack & ship inventory you don’t officially own (a great trick until the auditors find you – which they will, even if you run off to Panama).
  • Flagging unusually large product returns to individual consumers.  This prevents you from shipping 880 consumer devices to an person just because a customer-service rep incorrectly entered the model number into the quantity field on the product returns screen.  This is the kind error that’s preventable so you won’t have to Hear About It Later.

So if it seems like you’re living on the Mean Streets, your customers are on your back and even Jamie’s Cryin’, just look for those early warning KPIs.  Feel Unchained as you discover your own Brown M&Ms and soon you’ll be ready to Dance the Night Away.  And You Really Got Me if you leave a comment below and share your thoughts with the community.  Thanks for tuning in, gotta Jump.

 

PS: If you can’t tell, I am a huge Van Halen fan who literally wore out the band’s first album on my record player (talk about an obsolete SKU…)  If you didn’t catch the references above, the italicized words are Van Halen songs.

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bkahlee's picture
by Ellen Kahler posted on 2012-01-05

So how do you propose to capture the actual execution details required for real-time KPI notifications?

Thanks

Ellen

Dave Brooks's picture
by Dave Brooks posted on 2012-01-05

Hi Ellen - I work for Software AG, so I'm more than a bit partial to the webMethods application integration & business activity monitoring capabilities.  Whether integating internal data from ERP and home-grown systems or consolidating content from external sources to pull in customer and supplier information, the integration and analytic platform picks up transactional data and surfaces it through KPIs and end-user dashboards, all without significant drain on the existing system resources.

A number of my customers have very tangible examples of how this works and the value it delivers to the business.  Let me know if you'd like to discuss further...

Dave