Bullet
A bullet is such a system of remuneration. Nothing supernatural, the idea is on the surface, the results are not long in coming. The name was not invented by me, but by the owner of the company where this system was introduced. Just like that, I listened to the arguments and features, and said: "This is - Bullet!".
He probably meant that he liked the system, and not that it was a mythical silver bullet. In fact, the system is very limited, especially in scope, including the owner and the company's development plans.
The Bullet principle is very simple: pay people a share of the profits. Not for everyone, but only for those in the value chain. Trite, simple and boring. The whole chip is not in the system itself, not in the sharing of profits, but in ... Well, you yourself will know.
I do not pretend to a higher truth. The name "Bullet" is not a claim to originality or uniqueness. It’s just more convenient to discuss when it is called in one word. Bullet did the injection himself and saw how others do it. I’m not selling anything. Just telling. One cannot do without a programmer in implementation. Therefore, as they say, I'm sorry to address you.
The bullet was born in the struggle, incessant and terribly exhausting. This struggle has many names - business development, increasing efficiency, loyalty and engagement. This struggle is almost always unequal. On the one hand is the owner and, with luck, the director. On the other - all the other friends working in the company.
The owner wants to develop the business, tries to make some efforts in this direction, and is faced with resistance. At first, it seems to him that resistance is exerted by the external environment - customers, competitors, the state, etc. Then he realizes that the main obstacle is inside the company - those same friends.
The contradiction is understandable and understandable. People do something and get paid. Then the owner comes and says that you need to work more, or better. What for? So that he makes more money. And it doesn’t matter that he promises to invest all the additional profit on the development of the company, so that everything is good. People are not stupid, and understand that he, at best, scales up his business - he will buy a new workshop or build a store. They, people, will not increase the pay. Just friends will be more.
Roughly speaking, those who work today must make an effort so that they can work well tomorrow. Our grandparents went through this in the last century. In principle, judging by the reviews, they have nothing against - even, they say, it was interesting. But I want, somehow, something for myself, and, preferably, in this life.
That, in fact, is a contradiction. It’s not necessary to force people to work — they are coping. But something to change, improve, accelerate, increase, or reduce - you get the hell. And no one is to blame, there are no villains, everyone acts strictly within their own interests.
However, there are many ways out of the situation. One of them is the same Bullet. It is only necessary to solve a key issue.
The key question is very simple: is the owner willing to pay a constant share of the profits to his employees.
If you look, he pays employees a share. For any period - month, quarter or year - the wage fund is a certain share. True, in costs - it is customary to attribute it there.
The problem is that this proportion is constantly changing, from period to period. And there is a certain probability that this share will be reduced. For example, by doing something useful with efficiency.
Especially the effect can be seen where people get a salary. For example, the owner has a supply service, which consumes 1 million rubles a month, including taxes, depreciation, electricity and coffee with cookies. If all of a sudden, in some magical way, sales double, the supply service will continue to consume 1 million rubles a month, and its share in profit (or expenses, whatever) will decrease.
The whole question lies in this very "magical way." Here a whole camp of info-gypsians comes to the rescue, who are trying to sell their version “magically”.
The owner will succumb, listen to this “ai-nane-nane”, organize the implementation of something like Lean or CRM, but does not get the result. That is, it receives, but the opposite is conceived - the bills from the info-gypsum come impressive, and already clearly, without question, they get into the cost section. And the profit is not growing.
This can go on for quite some time. Some information gypsies give way to others, new methods, systems, blockchains and artificial intelligence, and the owner still expects that the profit will “magically” increase and the share of profit that he gives to his employees will decrease.
The proprietor does not always see that the info-gypsy aggravates the contradiction even more, which he tries to overcome with their help. After all, he had a problem: people didn’t care about his desire to develop his own business. But "do not care" is, as you know, indifference, indifference, nothing and nothing. Zero.
Because the owner asked the people themselves to increase the efficiency of his business without paying them money for it. And then what happens: since you don’t want it for free, here are the screaming beauties to whom I will dump millions, and they will do it for you. Well, on you, as on the experimental.
People naturally resist. Who wants to be the basis for the success of the info-gypsy? Again, without receiving any increase for this. After all, there is a possibility, albeit small, that the info-gypsy offer business. But they themselves cannot introduce and launch this business, they need the help of employees. Is there any reason to help them? So that they later begin to refer to you?
In general, the sooner the owner realizes that his share in profits “magically” does not grow, the better. No, of course, if the owner is sensible, or the info-gypsians are decent, then no Bullet is needed.
But if nothing happens, then the owner can sit down and think hard. Own strength does not work. With info gypsies, too. However, it is likely that employees will cope if they are given a share of the profits.
The probability, I must say, is not very high. But it will not be worse, since you yourself can’t, and external friends have not been able to help. It is only necessary to decide for yourself whether you are ready to work with a constant share of profit for yourself and a constant share in profit for employees.
In absolute terms, company revenue may grow. If the shares remain unchanged, then the income of the owner and the income of employees in absolute terms will increase. Those. money will be more, but they will have to share.
If the owner is ready to try, then you can begin to implement the Bullet.
Business programming teaches that self-defense must be incorporated into any system. Risks should be minimal, and in case of failure, you must be able to quickly roll back to the starting point without losing a lot of money and business.
In Pula, self-defense is inherent in the principle itself. The owner agrees that he gives the employees a share of the profit, and this share is unchanged. So, at the start it is necessary to determine whether, in principle, this share of the owner is satisfied.
After all, it happens that the business is already working in the red. In this case, the Bullet can not be implemented - you must first deal with the costs.
If the share is going back and forth, you can start. Just do not forget to talk with people and explain to them the essence of the experiment.
In this case, people are not an object, but the subject of an experiment. Roughly speaking, the owner takes them a share, and they get the opportunity to directly, and to a large extent, influence what is happening. They are now directly interested in the development of the company. The more sales and profits, the higher their income. Well and vice versa.
And the owner, as it were, moves aside, almost on equal terms. Now, if the company takes risks, then the company takes risks directly, that is, the whole, and not just the owner. It turns out - everyone gets rich. It doesn’t work out - everyone will be left without pants.
I recommend that you put employee self-defense in the system. On the one hand, a share in profit allows you to earn more. On the other hand, there is a big risk to earn not just less, but much less.
An ordinary employee, as a rule, is not very well aware of the risks of the business, because Used to get a salary. If a month happens with poor sales, then the owner has to get out to at least somehow pay off the employees. Of course, he will cut bonuses and terminate the corporate program for visiting the pool, but he won’t get to the pain - everyone will get their salary.
Therefore, simply transferring to a net share of profit is too risky. People will get scared and, in which case, run away, screaming on the go that the owner had deceived them and left them without pants.
I offer a simple option: a minimum salary. If in a new way, based on the share of profit, it turned out more than the salary, then pay on the profit. If the salary is higher, then pay it.
But not everything is so simple - it is too convenient for employees. It’s better to remember the difference.
For example, in the first month, profits are poor and salaries are paid. Ok, survive. We only remember the difference between the salary and the share of profit, and the employee will owe it to us. The following month, they worked well - excellent, get profit, but minus the difference that formed last month.
Well, the border of patience must be established. For example, if salary is paid within three months, the experiment can be considered unsuccessful and canceled by returning to the reference point. In this case, the risk, in sum terms, is known in advance.
Yes, but the positive difference between the amount of profit and salary is not necessary to remember. Employees, like the owner, must be in a constant tone, otherwise the temptation will be too great at some point to relax and get a salary without any sense of guilt.
Here I suggest not to bathe. Since the owner at the start decided that the share of the payroll would suit him, then take her as a starting point.
For example, if the salary of supply, in fact, is 5% of the profit, then take this percentage as a share. Do the same with any other posts in the value chain.
The easiest way, usually with sellers - they already pay a percentage of profit, revenue, or payments. It is only necessary to bring to a common indicator - profit.
Where the bullet was introduced, sellers, procurers, storekeepers, constructors, and manufacturers stood in a chain.
With sellers, I will not explain.
Procurement - in general, too. Sales, production, and even design development depend on their work - it is necessary to order prototypes of parts on time.
Storekeepers - not to say that they are right in the value chain, but they were thrown to the heap, because they already had almost piecework wages.
With the production is also clear. These guys produce what is then sold.
The designers were included so that they would think about sales, money, profits and customers for at least a second in their lives. And then they, as programmers, prefer to stand aside. Not forgetting, of course, to complain that they pay little.
Here comes the moment for an important cunning trick. The share must be determined by the function as a whole, and not by the employee.
If 5% for the supply, then 5% for the supply, and not 0.5% for the supply (if there were 10 people at the beginning of the experiment).
Well i.e. it doesn’t matter if there are 10 people or 50 - they always get 5% of the profit, at all.
Firstly, this is one of the elements of the system’s self-defense against bloating states. And then the head of the supply and the wife and mother-in-law will be employed by him in order to receive a handsome percentage of the profits.
Secondly, it is an incentive to increase efficiency by reducing staff. Alas, beautiful girls who only pour coffee to the boss and print meeting minutes (by the sysadmin) still meet.
Now such a girl will be a burden not for the owner, but for the entire supply department. Including - for the chief. Not if the entire supply department wants to see a beautiful girl nearby - with their feet in their mouths, they decide where to spend their percentage of profit.
It is important to avoid another extreme - stupidly give a percentage to the department to share as they want. In principle, sometimes this is probably justified. But the examples that I saw in life suggest the opposite.
If you simply give the share to the head of the department, so that he shares it at his discretion, then it will turn out not an effective function, but Overlord with henchmen. The key to high income is not a good job, but a good relationship with your boss.
Decent people in such conditions will not be able to work and will leave, despite the potentially high income. Moreover, we are not only talking about sellers for whom building relationships with anyone is part of the profession, but also about the same designers.
Therefore, sharing rules must be transparent - both within the function and outside it. And, preferably, automated. I will give a few examples.
With sellers, everything is simple. There is a customer order, there is a manager in it. By default, this is the manager assigned to the client, but there may be someone else (in case of vacation or dismissal of the main one).
If the sellers of two types are active and support, then the percentage of the order is divided in the agreed proportion. Active - the one who found the client. Escort - the one who draws up and accompanies the transaction.
If two worked on the deal, then both should be indicated in the order. More precisely, to enable them to specify.
Supply is easier to divide by nomenclature. Where it was introduced, divided into categories. For example, all forged and cast billets are purchased by one, all gears are purchased by another, rolled products are purchased by a third, etc.
Shares of profit are calculated as shares of the cost of materials and parts that procurers bought. Roughly speaking, the share of the supplier in the profit is equal to the share of the items purchased by him in the prime cost.
This method is not always suitable, because the cost may be skewed - for example, if any item takes on half of the cost. But in the context where this was introduced, there were few such distortions - two kinds.
The first is hefty body parts. But everyone got together and reasoned that there was always so much hemorrhoids with them because of the quality of casting / forging that it wasn’t dumb to dump a lot of money on the person who worked with them. Because there weren’t any volunteers.
The second - small expensive parts, some pieces of increased hardness. So high that where the hell you buy. It’s even simpler: they are so rarely needed, and there are so many difficulties that it’s not scary to pay a lot.
It’s more interesting with the designers - they were assigned the percentage of authors. Roughly speaking, there is a share in profit - let it be 5%. So, a label is attached to each item of the nomenclature - the participation shares of each designer.
For example, the designer drew the part, from beginning to end. The plate will be the only entry with his name, and a share of 100%. So, when selling this part - separately or as part of a product - it will receive 5% of the profit.
Then another designer made a finalization and issued a notice - the second line appears in the tablet with his last name and, say, a share of 10%. Accordingly, the percentage of profit will be divided in a ratio of 9 to 1.
The question arises - what should I do if the designer quit? We decided that in this case his share “burns out”. If he “owned” 90% of the copyright for this part, then only 10% will be paid to those who are still working. And when the part is again finalized, the shares will be recalculated.
The storekeepers, at that time, already had a piecework system in rubles per kilogram of parts that they shipped / posted / dragged. They left this system, only rubles per kg now did not mean absolute income, but a share in profit.
This whole thing needs to be quickly automated. There is nothing particularly complicated - you just need to add the corresponding fields in essence, such as orders from customers and suppliers, nomenclature, automate notifications, etc.
The main thing is that your cost price be considered as quickly and accurately as possible. Well, profit, respectively. While the profit was of interest only to the owner, no one was worried that the cost calculation ends on the 20th of the next month. Now it is desirable to have this figure in the first days of the month.
The first plug, which runs into the launch of the Bullet, are job duties. And this is one of the main advantages of a bullet.
Let's go back a little to our dark past. There were some departments and employees. They all did something — a whole bunch of responsibilities. Part prescribed to do the regulations, instructions and processes. The other part people came up with for themselves. The third part consisted of all kinds of instructions from higher and parallel superiors and employees.
People do something, and they get some kind of result. Associate what people do with the result, i.e. profit was impossible. In addition to sellers, of course. But it didn’t soar anyone - the salary was paid.
The supplier was sitting, and ordered the necessary parts and materials. The need for these details was determined by some plan, report, or even the devil knows what. In addition, he was still writing some kind of report, like a deficit statement. He was also forced to take a photograph of the working day, sometimes. He must also answer letters, attend meetings, etc.
And now - bdyms, and pay for profit. Cognitive dissonance arises. What for to do a deficit sheet? How does she help make more money? Why answer the letters of accounting, economists, programmers, etc.?
The first few days, people, by inertia, continue to work, as they always did. But then questions arise - for themselves, for their boss, for other units: why the fuck are you doing this?
And then the fun begins. Often no one can even remember why some obligation is being fulfilled, for whom a report is being compiled, who is reading letters or following some stupid indicator.
Comes to funny. The supplier sits and asks the question - what for, should I coordinate with the designers each purchase of any part? This question he asks his boss. He is indignant - and really after all, what for? He begins to run, yell, ask who invented this nonsense. The search leads to the quality service, which is in charge of the processes, and there is a piece of paper - it turns out that the procurement manager himself came up with this crap to protect himself from OTC claims at acceptance.
There is a tough and quick revision of job responsibilities, reminiscent of the Italian New Year. It is important to maintain balance. Nonsense that was once invented by the employees themselves, performing the function, you can safely throw out. But the responsibilities invented by the "serious" services, such as accounting or lawyers, are not so easy to throw out - you still need to take a closer look. Otherwise, business risks may increase dramatically.
And the sellers will walk around and repeat "we told you so." After all, they were always on the edge, and they always whined, repelled until the very last from incomprehensible duties imputed by other services. Of course, no one listened to them at that time, because they did not understand.
The owner or director must reserve the right to determine the vectors and methods of company development. It is clear that he already has this right, but it must be clearly stated at the beginning of the experiment.
Otherwise, people may get the impression that a certain self-government has begun, and now they themselves decide what to do with profit. Unfortunately, most employees have never done business, and they do not understand the importance of investment.
First of all, people will want to earn more by putting a minimum of effort. It’s easier for them to operate the current system than to make changes of any kind to it. They will behave like bad owners (or ordinary owners, whatever) - try to take as much money out of the business as possible.
In principle, their development money is not needed, i.e. no need to try to take part of their share of the return on investment. Enough rights to any changes. And people are already trapped.
If you remember, we started with the fact that no one wants to engage in the development of the company, the introduction of new working methods, and increasing efficiency. People do not need this stupidly, because they pay the same amount - both now and in case of success of the changes, and in case of their failure.
After the launch of the Bullet, the situation changes dramatically. If you leave everything as it is, then you will no longer earn. For some time you can sit like that, increasing income only by the fact that “now we will work normally, since such a thing”. But soon, and inevitably, the ceiling will be reached when the old system stops growing.
The difference is that now people see this ceiling, understand it and do not want it. After all, they receive a share of the profit, but the profit does not grow. And they will accept the need for change. Well, you’ll have to participate, maybe even with desire.
Also, people will no longer be indifferent to the outcome of changes. The success of the changes will increase their income - a positive motivation. Failure to change will reduce their income - negative motivation. Both variants of the results of changes are not indifferent to people. Which was required.
Moreover, it is not even necessary to seek the consent of people with those methods and tools that make up the essence of the changes. For example, the director wants to implement CRM (and we remember that he has the right to choose). People will not only have to participate in these changes - it is in their vital interests to bring these changes to success. It is clear, after all, that a poorly implemented CRM is just a burden, a dead system, into which you need to enter a bunch of data without any exhaust.
After the launch of the Bullet, at first, a strange picture will be observed. It seems that now you can earn more, but this does not happen. Everyone shows about the same result as before, on salary. As if waiting for something.
They are waiting for an example. For years, the concepts of “norm” and “plan” have been driven into people’s heads, and they, consciously or unconsciously, focus on them. Now, by launching the Bullet, we seem to have removed the concept of the norm - there is no ceiling. But people themselves will find the norm - "as it was before."
You can, of course, try to explain to them and tell them what great opportunities they have now. But it is better to show an example.
For example, as was done in the USSR. They took a man by the name of Stakhanov, sent him to the mine (after having driven everyone out of there), gave him assistants (to do secondary work), and ordered him to set a record. He set it - he did 14 norms per shift, if I’m not mistaken (the description of the way this measure is implemented is taken from the book “Russian Management Model” by Prokhorov).
The essence is clear - a living, real illustrative example is being created. The new norm. Let it be so far unattainable, or seeming as such, but at least some clue for intention.
It happens that the Stakhanovite is formed by itself. Usually this is some kind of new employee who has not yet accustomed to the system, who has not had time to get used to it, and who has not been nurtured by the old rules. For example, in one of the companies where the Bullet prototype worked, such a Stakhanovite took and made 4 norms, completely changing the reality and attitude to what is happening. No one else worked the old way.
Perhaps you can wait a month, and if the Stakhanovite doesn't show up, create it artificially. Agree with a good person, help him, organize a “feat”, support. Better secretly, of course. Well, I think so.
In the example that I am talking about, Bullet was included immediately for the entire value chain. This is both good and bad.
Good - because otherwise nothing. Actually, before the launch of the Bullet on the whole chain, she already acted in one of its links - sales. As a result, one link was steamed about sales and profits, and the rest were not. Therefore, nothing happened, if you look at the whole, on the whole chain.
Bad - because due to failures in one link the whole chain will fall. The exception is the constructors, because they are not in the main stream, but in the supply stream - they are developing new products, i.e. work, one might say, for development, or for future sales.
If during the implementation of the Bullet it happens that all the functions are understood and accepted, changed the mode of their work, but the same suppliers are not, then there will immediately be a traffic jam. The classical theory of Goldratt system constraints will work here, and the overall speed / performance of the circuit will be determined by the speed / performance of the slowest link.
Previously, it didn’t matter, because the performance of each link was not particularly measured. Well, there was a traffic jam, well, they had a fight at the meeting, well, they wrote a memo “immediately eliminate”. Three nails worked, and everyone forgot about the cork.
Now traffic jams are becoming a real problem. Especially if the cork is not single, random, but systematic. Some dudes are sitting and do not want to live in a new way. Or passively, or actively, or actively-passively, such as an Italian strike.
Here, of course, we would have to figure it out. It happens that one person creates a traffic jam - the head of the function. Here he is against, and that’s it. And he manages his people as "I think is right." In principle, there is nothing wrong here - a person makes a choice. Only now it interferes with the rest - both colleagues and business. It’s better to do something with him.
It’s not necessary to dismiss - you can isolate. Put another person in his place, and arrange downshifting for the cork maker. Well, it’s kind of like, since you are such a fine fellow, and you know how to work properly - sit down and work, enough to manage.
Traffic jams are easiest to track by incomplete - everything is in accordance with TOC. Where the most tasks have accumulated, there is traffic jam. And here you can not do without decent automation.
For example, we look at supply shortages, i.e. Unmet sales / production needs are incomplete. Do not forget about the Iceberg, i.e. measuring the duration of this incompleteness (such as "this item of stocks has been in deficit for a month now").
At first, people will experience cognitive dissonance due to the application of the essence of Bullets to their work. They will not understand / accept that they are paid for what is being sold.
Here sits a supplier who always bought bolts and nuts. He was given a list of positions and quantity, he ordered, tracked payment and delivery, and waited for the next task. He was not particularly interested in who, why, and when bolts and nuts were needed. Work separately, salary separately, there is no particular connection between them.
And here - bam, and only what is sold is paid. You bought bolts, but they are not for sale, either in the form of goods or in the form of component products, and you do not receive money. The question of what for I bought these bolts arises by itself, although before it was not.
At the same time, there may be a nearby task for the purchase of an item, without which some sale cannot take place. For example, a client has ordered 40 positions, and does not want to receive them in parts - only all at once. One item is not available, and the entire order lies in the box, waiting for the spring. Or for assembly of finished products there is not enough tape FUM, the purchase of which someone profakapil.
Now, with the introduction of Bullets, one has to think. It is desirable, of course, that the boss thinks - at least to his subordinates. Just so familiar. But sometimes you have to think for yourself.
The principle is simple: you need to do what helps sales. It sounds corny, but no one has done it before. That is why a brain explosion occurs.
It is even more difficult for designers to understand this principle. They always sat on the sidelines from sales, and consciously. Well, like, we are not traders, but engineers. And then there’s some kind of Bullet, and now your salary depends on how you sell what you drew / developed / finalized.
For designers, the brain just boils. They never thought in such categories, did not work for such a purpose. All that interested them in sales was whether the customer’s hardware breaks or not. Moreover, the interest was not engineering, but selfish - because they will scold.
None of them will modify parts that don’t buy anyway. And before they worked on it, because there was such a task in the plan drawn up by someone a year ago.
What am I doing? You have to be prepared for a brain explosion, accompany it, put it in a positive direction. Otherwise, it will go into the negative - sabotage, dismissal, open resistance.
Sometimes it seems that people are full of great ideas for the development of the company, and with normal motivation, they will not only express these ideas, but will also implement them. Especially often it seems to people themselves.
Most likely, after the transition to the Bullet of ideas and proposals, indeed, there will be more. But there is one “but”: the less time has passed since the transition, the worse the idea.
Here it works in much the same way as the water in the tap after repairing the water main - at first some kind of turbidity flows. The first ideas expressed by employees will relate to a previous reality, a different level of thinking. As Einstein said there, it is impossible to solve problems, being at the same level at which they were created.
You just need to understand: a person spent his whole life on a salary. He thinks in salary, small bonuses, tasks from the boss, plans and irresponsibility. After the transition to the Bullet, he, by inertia, will think the same way. Just reformulates his ideas in new terms.
Especially it is necessary to be wary of ideas that begin with the words "I have long been offering, ..." or "The whole world does this: ...". If offered long ago, then the idea belonged to a different context. If the whole world does this, then the idea will come from a different opera, because the whole world is on a salary.
Let people get used to the new reality, get used to it, take a closer look, see real problems - those that did not appear before. The haze of old ideas will merge, and a normal, clean stream of useful suggestions will open.
You probably have a question - what profit should be taken as a basis? Marginal? EBITDA? Clean?
There is no exact answer, you need to look at the situation. Personally, it seems to me that we need to take a formula that takes into account the maximum cost. In addition to the dividends of the owner, of course - if they are, as an entity.
If you take, for example, marginal profit, you can be left without pants - the income of employees will not depend on "heavy" costs, such as capital investments, depreciation or the acquisition of fixed assets. Then the question of buying a new machine will be a headache only for the owner.
Infrequently, but it happens that the introduction of a bullet leads to an unexpected effect - the owner merges. Not at all from the business, but from the introduction of Bullets.
While everyone received a salary, the owner, or director, could pretend that he alone cares about the development of the business, does something, and the rest are loafers. He offered, forced, asked to change something, but nothing came of it. Well, he was very proud of this role of his offense.
After the introduction of the Bullet, the situation may change. For example, it becomes obvious to everyone what changes need to be made. And, alas, part of the responsibility for implementing the changes lies with this owner / director.
The picture is fundamentally changing. He used to tell everyone what to do. And then they begin to tell him what to do. That’s direct to do, and not to put forward ideas. Here the owner merges.
There is such an effect, I don’t know what it is called: people offer a bunch of ideas for development, but only because they know that no one will implement them. Directors behave in exactly the same way - they are just people.
As long as the owner knew that no one would be able to, would not want to realize his ideas, he gush with these ideas. As soon as the environment becomes flexible and pliable, ready for change, it becomes scary for him - suddenly he offered bullshit? And he is silent.
And when the environment comes to him with offers - merges. And the introduction of the Bullet stops at the initiative of the owner. Roughly speaking, it becomes a cork, not even being a link in the value chain.
They throw the bullet together, they forget about the experiment, they pay salaries to everyone, they all work somehow, and the director continues to whine that nobody needs anything but him.
I still want to write a lot of things, but already almost 30 thousand letters have turned out. The topic is too extensive for one article, I guess.
Bullet payment system - an effective, but complex thing. First of all - mentally, because based on principles not close to most people. Therefore, it must be implemented carefully, as closely following the process as possible and in a timely manner responding to emerging problems.
He probably meant that he liked the system, and not that it was a mythical silver bullet. In fact, the system is very limited, especially in scope, including the owner and the company's development plans.
The Bullet principle is very simple: pay people a share of the profits. Not for everyone, but only for those in the value chain. Trite, simple and boring. The whole chip is not in the system itself, not in the sharing of profits, but in ... Well, you yourself will know.
I do not pretend to a higher truth. The name "Bullet" is not a claim to originality or uniqueness. It’s just more convenient to discuss when it is called in one word. Bullet did the injection himself and saw how others do it. I’m not selling anything. Just telling. One cannot do without a programmer in implementation. Therefore, as they say, I'm sorry to address you.
Background
The bullet was born in the struggle, incessant and terribly exhausting. This struggle has many names - business development, increasing efficiency, loyalty and engagement. This struggle is almost always unequal. On the one hand is the owner and, with luck, the director. On the other - all the other friends working in the company.
The owner wants to develop the business, tries to make some efforts in this direction, and is faced with resistance. At first, it seems to him that resistance is exerted by the external environment - customers, competitors, the state, etc. Then he realizes that the main obstacle is inside the company - those same friends.
The contradiction is understandable and understandable. People do something and get paid. Then the owner comes and says that you need to work more, or better. What for? So that he makes more money. And it doesn’t matter that he promises to invest all the additional profit on the development of the company, so that everything is good. People are not stupid, and understand that he, at best, scales up his business - he will buy a new workshop or build a store. They, people, will not increase the pay. Just friends will be more.
Roughly speaking, those who work today must make an effort so that they can work well tomorrow. Our grandparents went through this in the last century. In principle, judging by the reviews, they have nothing against - even, they say, it was interesting. But I want, somehow, something for myself, and, preferably, in this life.
That, in fact, is a contradiction. It’s not necessary to force people to work — they are coping. But something to change, improve, accelerate, increase, or reduce - you get the hell. And no one is to blame, there are no villains, everyone acts strictly within their own interests.
However, there are many ways out of the situation. One of them is the same Bullet. It is only necessary to solve a key issue.
Key question
The key question is very simple: is the owner willing to pay a constant share of the profits to his employees.
If you look, he pays employees a share. For any period - month, quarter or year - the wage fund is a certain share. True, in costs - it is customary to attribute it there.
The problem is that this proportion is constantly changing, from period to period. And there is a certain probability that this share will be reduced. For example, by doing something useful with efficiency.
Especially the effect can be seen where people get a salary. For example, the owner has a supply service, which consumes 1 million rubles a month, including taxes, depreciation, electricity and coffee with cookies. If all of a sudden, in some magical way, sales double, the supply service will continue to consume 1 million rubles a month, and its share in profit (or expenses, whatever) will decrease.
The whole question lies in this very "magical way." Here a whole camp of info-gypsians comes to the rescue, who are trying to sell their version “magically”.
The owner will succumb, listen to this “ai-nane-nane”, organize the implementation of something like Lean or CRM, but does not get the result. That is, it receives, but the opposite is conceived - the bills from the info-gypsum come impressive, and already clearly, without question, they get into the cost section. And the profit is not growing.
This can go on for quite some time. Some information gypsies give way to others, new methods, systems, blockchains and artificial intelligence, and the owner still expects that the profit will “magically” increase and the share of profit that he gives to his employees will decrease.
The proprietor does not always see that the info-gypsy aggravates the contradiction even more, which he tries to overcome with their help. After all, he had a problem: people didn’t care about his desire to develop his own business. But "do not care" is, as you know, indifference, indifference, nothing and nothing. Zero.
Because the owner asked the people themselves to increase the efficiency of his business without paying them money for it. And then what happens: since you don’t want it for free, here are the screaming beauties to whom I will dump millions, and they will do it for you. Well, on you, as on the experimental.
People naturally resist. Who wants to be the basis for the success of the info-gypsy? Again, without receiving any increase for this. After all, there is a possibility, albeit small, that the info-gypsy offer business. But they themselves cannot introduce and launch this business, they need the help of employees. Is there any reason to help them? So that they later begin to refer to you?
In general, the sooner the owner realizes that his share in profits “magically” does not grow, the better. No, of course, if the owner is sensible, or the info-gypsians are decent, then no Bullet is needed.
But if nothing happens, then the owner can sit down and think hard. Own strength does not work. With info gypsies, too. However, it is likely that employees will cope if they are given a share of the profits.
The probability, I must say, is not very high. But it will not be worse, since you yourself can’t, and external friends have not been able to help. It is only necessary to decide for yourself whether you are ready to work with a constant share of profit for yourself and a constant share in profit for employees.
In absolute terms, company revenue may grow. If the shares remain unchanged, then the income of the owner and the income of employees in absolute terms will increase. Those. money will be more, but they will have to share.
If the owner is ready to try, then you can begin to implement the Bullet.
Self defense
Business programming teaches that self-defense must be incorporated into any system. Risks should be minimal, and in case of failure, you must be able to quickly roll back to the starting point without losing a lot of money and business.
In Pula, self-defense is inherent in the principle itself. The owner agrees that he gives the employees a share of the profit, and this share is unchanged. So, at the start it is necessary to determine whether, in principle, this share of the owner is satisfied.
After all, it happens that the business is already working in the red. In this case, the Bullet can not be implemented - you must first deal with the costs.
If the share is going back and forth, you can start. Just do not forget to talk with people and explain to them the essence of the experiment.
In this case, people are not an object, but the subject of an experiment. Roughly speaking, the owner takes them a share, and they get the opportunity to directly, and to a large extent, influence what is happening. They are now directly interested in the development of the company. The more sales and profits, the higher their income. Well and vice versa.
And the owner, as it were, moves aside, almost on equal terms. Now, if the company takes risks, then the company takes risks directly, that is, the whole, and not just the owner. It turns out - everyone gets rich. It doesn’t work out - everyone will be left without pants.
Employee Self-Defense
I recommend that you put employee self-defense in the system. On the one hand, a share in profit allows you to earn more. On the other hand, there is a big risk to earn not just less, but much less.
An ordinary employee, as a rule, is not very well aware of the risks of the business, because Used to get a salary. If a month happens with poor sales, then the owner has to get out to at least somehow pay off the employees. Of course, he will cut bonuses and terminate the corporate program for visiting the pool, but he won’t get to the pain - everyone will get their salary.
Therefore, simply transferring to a net share of profit is too risky. People will get scared and, in which case, run away, screaming on the go that the owner had deceived them and left them without pants.
I offer a simple option: a minimum salary. If in a new way, based on the share of profit, it turned out more than the salary, then pay on the profit. If the salary is higher, then pay it.
But not everything is so simple - it is too convenient for employees. It’s better to remember the difference.
For example, in the first month, profits are poor and salaries are paid. Ok, survive. We only remember the difference between the salary and the share of profit, and the employee will owe it to us. The following month, they worked well - excellent, get profit, but minus the difference that formed last month.
Well, the border of patience must be established. For example, if salary is paid within three months, the experiment can be considered unsuccessful and canceled by returning to the reference point. In this case, the risk, in sum terms, is known in advance.
Yes, but the positive difference between the amount of profit and salary is not necessary to remember. Employees, like the owner, must be in a constant tone, otherwise the temptation will be too great at some point to relax and get a salary without any sense of guilt.
Initial shares
Here I suggest not to bathe. Since the owner at the start decided that the share of the payroll would suit him, then take her as a starting point.
For example, if the salary of supply, in fact, is 5% of the profit, then take this percentage as a share. Do the same with any other posts in the value chain.
The easiest way, usually with sellers - they already pay a percentage of profit, revenue, or payments. It is only necessary to bring to a common indicator - profit.
Where the bullet was introduced, sellers, procurers, storekeepers, constructors, and manufacturers stood in a chain.
With sellers, I will not explain.
Procurement - in general, too. Sales, production, and even design development depend on their work - it is necessary to order prototypes of parts on time.
Storekeepers - not to say that they are right in the value chain, but they were thrown to the heap, because they already had almost piecework wages.
With the production is also clear. These guys produce what is then sold.
The designers were included so that they would think about sales, money, profits and customers for at least a second in their lives. And then they, as programmers, prefer to stand aside. Not forgetting, of course, to complain that they pay little.
Cunning
Here comes the moment for an important cunning trick. The share must be determined by the function as a whole, and not by the employee.
If 5% for the supply, then 5% for the supply, and not 0.5% for the supply (if there were 10 people at the beginning of the experiment).
Well i.e. it doesn’t matter if there are 10 people or 50 - they always get 5% of the profit, at all.
Firstly, this is one of the elements of the system’s self-defense against bloating states. And then the head of the supply and the wife and mother-in-law will be employed by him in order to receive a handsome percentage of the profits.
Secondly, it is an incentive to increase efficiency by reducing staff. Alas, beautiful girls who only pour coffee to the boss and print meeting minutes (by the sysadmin) still meet.
Now such a girl will be a burden not for the owner, but for the entire supply department. Including - for the chief. Not if the entire supply department wants to see a beautiful girl nearby - with their feet in their mouths, they decide where to spend their percentage of profit.
Sharing
It is important to avoid another extreme - stupidly give a percentage to the department to share as they want. In principle, sometimes this is probably justified. But the examples that I saw in life suggest the opposite.
If you simply give the share to the head of the department, so that he shares it at his discretion, then it will turn out not an effective function, but Overlord with henchmen. The key to high income is not a good job, but a good relationship with your boss.
Decent people in such conditions will not be able to work and will leave, despite the potentially high income. Moreover, we are not only talking about sellers for whom building relationships with anyone is part of the profession, but also about the same designers.
Therefore, sharing rules must be transparent - both within the function and outside it. And, preferably, automated. I will give a few examples.
Sharing examples
With sellers, everything is simple. There is a customer order, there is a manager in it. By default, this is the manager assigned to the client, but there may be someone else (in case of vacation or dismissal of the main one).
If the sellers of two types are active and support, then the percentage of the order is divided in the agreed proportion. Active - the one who found the client. Escort - the one who draws up and accompanies the transaction.
If two worked on the deal, then both should be indicated in the order. More precisely, to enable them to specify.
Supply is easier to divide by nomenclature. Where it was introduced, divided into categories. For example, all forged and cast billets are purchased by one, all gears are purchased by another, rolled products are purchased by a third, etc.
Shares of profit are calculated as shares of the cost of materials and parts that procurers bought. Roughly speaking, the share of the supplier in the profit is equal to the share of the items purchased by him in the prime cost.
This method is not always suitable, because the cost may be skewed - for example, if any item takes on half of the cost. But in the context where this was introduced, there were few such distortions - two kinds.
The first is hefty body parts. But everyone got together and reasoned that there was always so much hemorrhoids with them because of the quality of casting / forging that it wasn’t dumb to dump a lot of money on the person who worked with them. Because there weren’t any volunteers.
The second - small expensive parts, some pieces of increased hardness. So high that where the hell you buy. It’s even simpler: they are so rarely needed, and there are so many difficulties that it’s not scary to pay a lot.
It’s more interesting with the designers - they were assigned the percentage of authors. Roughly speaking, there is a share in profit - let it be 5%. So, a label is attached to each item of the nomenclature - the participation shares of each designer.
For example, the designer drew the part, from beginning to end. The plate will be the only entry with his name, and a share of 100%. So, when selling this part - separately or as part of a product - it will receive 5% of the profit.
Then another designer made a finalization and issued a notice - the second line appears in the tablet with his last name and, say, a share of 10%. Accordingly, the percentage of profit will be divided in a ratio of 9 to 1.
The question arises - what should I do if the designer quit? We decided that in this case his share “burns out”. If he “owned” 90% of the copyright for this part, then only 10% will be paid to those who are still working. And when the part is again finalized, the shares will be recalculated.
The storekeepers, at that time, already had a piecework system in rubles per kilogram of parts that they shipped / posted / dragged. They left this system, only rubles per kg now did not mean absolute income, but a share in profit.
Automation
This whole thing needs to be quickly automated. There is nothing particularly complicated - you just need to add the corresponding fields in essence, such as orders from customers and suppliers, nomenclature, automate notifications, etc.
The main thing is that your cost price be considered as quickly and accurately as possible. Well, profit, respectively. While the profit was of interest only to the owner, no one was worried that the cost calculation ends on the 20th of the next month. Now it is desirable to have this figure in the first days of the month.
First plug
The first plug, which runs into the launch of the Bullet, are job duties. And this is one of the main advantages of a bullet.
Let's go back a little to our dark past. There were some departments and employees. They all did something — a whole bunch of responsibilities. Part prescribed to do the regulations, instructions and processes. The other part people came up with for themselves. The third part consisted of all kinds of instructions from higher and parallel superiors and employees.
People do something, and they get some kind of result. Associate what people do with the result, i.e. profit was impossible. In addition to sellers, of course. But it didn’t soar anyone - the salary was paid.
The supplier was sitting, and ordered the necessary parts and materials. The need for these details was determined by some plan, report, or even the devil knows what. In addition, he was still writing some kind of report, like a deficit statement. He was also forced to take a photograph of the working day, sometimes. He must also answer letters, attend meetings, etc.
And now - bdyms, and pay for profit. Cognitive dissonance arises. What for to do a deficit sheet? How does she help make more money? Why answer the letters of accounting, economists, programmers, etc.?
The first few days, people, by inertia, continue to work, as they always did. But then questions arise - for themselves, for their boss, for other units: why the fuck are you doing this?
And then the fun begins. Often no one can even remember why some obligation is being fulfilled, for whom a report is being compiled, who is reading letters or following some stupid indicator.
Comes to funny. The supplier sits and asks the question - what for, should I coordinate with the designers each purchase of any part? This question he asks his boss. He is indignant - and really after all, what for? He begins to run, yell, ask who invented this nonsense. The search leads to the quality service, which is in charge of the processes, and there is a piece of paper - it turns out that the procurement manager himself came up with this crap to protect himself from OTC claims at acceptance.
There is a tough and quick revision of job responsibilities, reminiscent of the Italian New Year. It is important to maintain balance. Nonsense that was once invented by the employees themselves, performing the function, you can safely throw out. But the responsibilities invented by the "serious" services, such as accounting or lawyers, are not so easy to throw out - you still need to take a closer look. Otherwise, business risks may increase dramatically.
And the sellers will walk around and repeat "we told you so." After all, they were always on the edge, and they always whined, repelled until the very last from incomprehensible duties imputed by other services. Of course, no one listened to them at that time, because they did not understand.
Right to development
The owner or director must reserve the right to determine the vectors and methods of company development. It is clear that he already has this right, but it must be clearly stated at the beginning of the experiment.
Otherwise, people may get the impression that a certain self-government has begun, and now they themselves decide what to do with profit. Unfortunately, most employees have never done business, and they do not understand the importance of investment.
First of all, people will want to earn more by putting a minimum of effort. It’s easier for them to operate the current system than to make changes of any kind to it. They will behave like bad owners (or ordinary owners, whatever) - try to take as much money out of the business as possible.
In principle, their development money is not needed, i.e. no need to try to take part of their share of the return on investment. Enough rights to any changes. And people are already trapped.
Trap
If you remember, we started with the fact that no one wants to engage in the development of the company, the introduction of new working methods, and increasing efficiency. People do not need this stupidly, because they pay the same amount - both now and in case of success of the changes, and in case of their failure.
After the launch of the Bullet, the situation changes dramatically. If you leave everything as it is, then you will no longer earn. For some time you can sit like that, increasing income only by the fact that “now we will work normally, since such a thing”. But soon, and inevitably, the ceiling will be reached when the old system stops growing.
The difference is that now people see this ceiling, understand it and do not want it. After all, they receive a share of the profit, but the profit does not grow. And they will accept the need for change. Well, you’ll have to participate, maybe even with desire.
Also, people will no longer be indifferent to the outcome of changes. The success of the changes will increase their income - a positive motivation. Failure to change will reduce their income - negative motivation. Both variants of the results of changes are not indifferent to people. Which was required.
Moreover, it is not even necessary to seek the consent of people with those methods and tools that make up the essence of the changes. For example, the director wants to implement CRM (and we remember that he has the right to choose). People will not only have to participate in these changes - it is in their vital interests to bring these changes to success. It is clear, after all, that a poorly implemented CRM is just a burden, a dead system, into which you need to enter a bunch of data without any exhaust.
Stakhanov
After the launch of the Bullet, at first, a strange picture will be observed. It seems that now you can earn more, but this does not happen. Everyone shows about the same result as before, on salary. As if waiting for something.
They are waiting for an example. For years, the concepts of “norm” and “plan” have been driven into people’s heads, and they, consciously or unconsciously, focus on them. Now, by launching the Bullet, we seem to have removed the concept of the norm - there is no ceiling. But people themselves will find the norm - "as it was before."
You can, of course, try to explain to them and tell them what great opportunities they have now. But it is better to show an example.
For example, as was done in the USSR. They took a man by the name of Stakhanov, sent him to the mine (after having driven everyone out of there), gave him assistants (to do secondary work), and ordered him to set a record. He set it - he did 14 norms per shift, if I’m not mistaken (the description of the way this measure is implemented is taken from the book “Russian Management Model” by Prokhorov).
The essence is clear - a living, real illustrative example is being created. The new norm. Let it be so far unattainable, or seeming as such, but at least some clue for intention.
It happens that the Stakhanovite is formed by itself. Usually this is some kind of new employee who has not yet accustomed to the system, who has not had time to get used to it, and who has not been nurtured by the old rules. For example, in one of the companies where the Bullet prototype worked, such a Stakhanovite took and made 4 norms, completely changing the reality and attitude to what is happening. No one else worked the old way.
Perhaps you can wait a month, and if the Stakhanovite doesn't show up, create it artificially. Agree with a good person, help him, organize a “feat”, support. Better secretly, of course. Well, I think so.
Bung
In the example that I am talking about, Bullet was included immediately for the entire value chain. This is both good and bad.
Good - because otherwise nothing. Actually, before the launch of the Bullet on the whole chain, she already acted in one of its links - sales. As a result, one link was steamed about sales and profits, and the rest were not. Therefore, nothing happened, if you look at the whole, on the whole chain.
Bad - because due to failures in one link the whole chain will fall. The exception is the constructors, because they are not in the main stream, but in the supply stream - they are developing new products, i.e. work, one might say, for development, or for future sales.
If during the implementation of the Bullet it happens that all the functions are understood and accepted, changed the mode of their work, but the same suppliers are not, then there will immediately be a traffic jam. The classical theory of Goldratt system constraints will work here, and the overall speed / performance of the circuit will be determined by the speed / performance of the slowest link.
Previously, it didn’t matter, because the performance of each link was not particularly measured. Well, there was a traffic jam, well, they had a fight at the meeting, well, they wrote a memo “immediately eliminate”. Three nails worked, and everyone forgot about the cork.
Now traffic jams are becoming a real problem. Especially if the cork is not single, random, but systematic. Some dudes are sitting and do not want to live in a new way. Or passively, or actively, or actively-passively, such as an Italian strike.
Here, of course, we would have to figure it out. It happens that one person creates a traffic jam - the head of the function. Here he is against, and that’s it. And he manages his people as "I think is right." In principle, there is nothing wrong here - a person makes a choice. Only now it interferes with the rest - both colleagues and business. It’s better to do something with him.
It’s not necessary to dismiss - you can isolate. Put another person in his place, and arrange downshifting for the cork maker. Well, it’s kind of like, since you are such a fine fellow, and you know how to work properly - sit down and work, enough to manage.
Traffic jams are easiest to track by incomplete - everything is in accordance with TOC. Where the most tasks have accumulated, there is traffic jam. And here you can not do without decent automation.
For example, we look at supply shortages, i.e. Unmet sales / production needs are incomplete. Do not forget about the Iceberg, i.e. measuring the duration of this incompleteness (such as "this item of stocks has been in deficit for a month now").
Brain explosion
At first, people will experience cognitive dissonance due to the application of the essence of Bullets to their work. They will not understand / accept that they are paid for what is being sold.
Here sits a supplier who always bought bolts and nuts. He was given a list of positions and quantity, he ordered, tracked payment and delivery, and waited for the next task. He was not particularly interested in who, why, and when bolts and nuts were needed. Work separately, salary separately, there is no particular connection between them.
And here - bam, and only what is sold is paid. You bought bolts, but they are not for sale, either in the form of goods or in the form of component products, and you do not receive money. The question of what for I bought these bolts arises by itself, although before it was not.
At the same time, there may be a nearby task for the purchase of an item, without which some sale cannot take place. For example, a client has ordered 40 positions, and does not want to receive them in parts - only all at once. One item is not available, and the entire order lies in the box, waiting for the spring. Or for assembly of finished products there is not enough tape FUM, the purchase of which someone profakapil.
Now, with the introduction of Bullets, one has to think. It is desirable, of course, that the boss thinks - at least to his subordinates. Just so familiar. But sometimes you have to think for yourself.
The principle is simple: you need to do what helps sales. It sounds corny, but no one has done it before. That is why a brain explosion occurs.
It is even more difficult for designers to understand this principle. They always sat on the sidelines from sales, and consciously. Well, like, we are not traders, but engineers. And then there’s some kind of Bullet, and now your salary depends on how you sell what you drew / developed / finalized.
For designers, the brain just boils. They never thought in such categories, did not work for such a purpose. All that interested them in sales was whether the customer’s hardware breaks or not. Moreover, the interest was not engineering, but selfish - because they will scold.
None of them will modify parts that don’t buy anyway. And before they worked on it, because there was such a task in the plan drawn up by someone a year ago.
What am I doing? You have to be prepared for a brain explosion, accompany it, put it in a positive direction. Otherwise, it will go into the negative - sabotage, dismissal, open resistance.
Development ideas
Sometimes it seems that people are full of great ideas for the development of the company, and with normal motivation, they will not only express these ideas, but will also implement them. Especially often it seems to people themselves.
Most likely, after the transition to the Bullet of ideas and proposals, indeed, there will be more. But there is one “but”: the less time has passed since the transition, the worse the idea.
Here it works in much the same way as the water in the tap after repairing the water main - at first some kind of turbidity flows. The first ideas expressed by employees will relate to a previous reality, a different level of thinking. As Einstein said there, it is impossible to solve problems, being at the same level at which they were created.
You just need to understand: a person spent his whole life on a salary. He thinks in salary, small bonuses, tasks from the boss, plans and irresponsibility. After the transition to the Bullet, he, by inertia, will think the same way. Just reformulates his ideas in new terms.
Especially it is necessary to be wary of ideas that begin with the words "I have long been offering, ..." or "The whole world does this: ...". If offered long ago, then the idea belonged to a different context. If the whole world does this, then the idea will come from a different opera, because the whole world is on a salary.
Let people get used to the new reality, get used to it, take a closer look, see real problems - those that did not appear before. The haze of old ideas will merge, and a normal, clean stream of useful suggestions will open.
Maths
You probably have a question - what profit should be taken as a basis? Marginal? EBITDA? Clean?
There is no exact answer, you need to look at the situation. Personally, it seems to me that we need to take a formula that takes into account the maximum cost. In addition to the dividends of the owner, of course - if they are, as an entity.
If you take, for example, marginal profit, you can be left without pants - the income of employees will not depend on "heavy" costs, such as capital investments, depreciation or the acquisition of fixed assets. Then the question of buying a new machine will be a headache only for the owner.
Owner Responsibility
Infrequently, but it happens that the introduction of a bullet leads to an unexpected effect - the owner merges. Not at all from the business, but from the introduction of Bullets.
While everyone received a salary, the owner, or director, could pretend that he alone cares about the development of the business, does something, and the rest are loafers. He offered, forced, asked to change something, but nothing came of it. Well, he was very proud of this role of his offense.
After the introduction of the Bullet, the situation may change. For example, it becomes obvious to everyone what changes need to be made. And, alas, part of the responsibility for implementing the changes lies with this owner / director.
The picture is fundamentally changing. He used to tell everyone what to do. And then they begin to tell him what to do. That’s direct to do, and not to put forward ideas. Here the owner merges.
There is such an effect, I don’t know what it is called: people offer a bunch of ideas for development, but only because they know that no one will implement them. Directors behave in exactly the same way - they are just people.
As long as the owner knew that no one would be able to, would not want to realize his ideas, he gush with these ideas. As soon as the environment becomes flexible and pliable, ready for change, it becomes scary for him - suddenly he offered bullshit? And he is silent.
And when the environment comes to him with offers - merges. And the introduction of the Bullet stops at the initiative of the owner. Roughly speaking, it becomes a cork, not even being a link in the value chain.
They throw the bullet together, they forget about the experiment, they pay salaries to everyone, they all work somehow, and the director continues to whine that nobody needs anything but him.
Summary
I still want to write a lot of things, but already almost 30 thousand letters have turned out. The topic is too extensive for one article, I guess.
Bullet payment system - an effective, but complex thing. First of all - mentally, because based on principles not close to most people. Therefore, it must be implemented carefully, as closely following the process as possible and in a timely manner responding to emerging problems.
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