What Is Red X?
Peter D. Shainin, CEO Shainin
Red X is an approach to solving problems, as well as our brand. It started as an approach to solving engineering problems but its principles turned out to be quite useful for solving business process problems as well. Its principles are straight forward:
- Pareto (the 80/20 rule)
- Fact based decision making
- Convergent strategies
The 80/20 rule as applied to business says that it is likely that 80% of your business comes from 20% of your customers. 80% of your bad debts also come from 20% of your customers; we hope a different 20%. If you can get rid of the bad 20% of your customers and keep the good 20% you would make a big improvement in your business. Those who have tried this know that it is easier said than done but many businesses have seen big improvements made this way. If your car is not running properly is the cause improper fuel mixture, weak spark, poor timing, low compression or a little bit of each? Every good mechanic knows it is one of those things, not a little bit of each. Pareto applied to engineering problems means there is one or a very few causes to the problem even though there are many possibilities.
Fact based decision making means making decisions about where to look for the cause of a problem based on observed facts, not opinions. Some popular problem solving methods begin with brainstorming or drawing fish-bone (cause and effect) diagrams. These are opinions. To observe the real facts you must look very carefully at what is actually happening. This is also harder than it seems. Many business organizations are very political. The fish bone diagram is likely to reflect the opinion of the most senior person present. That person is also least likely to have spent the time required in careful observation of the facts to get them right. We like to use the language "talk to the parts" meaning use the actual failures to perform careful observation and clue generation. This is an absolute requirement for Red X.
It is often easy to think of how to test a single idea. But what if that idea is wrong? You will have wasted all the time and money required for the test only to show that your "good idea" was wrong. It is much more difficult to design a test that splits all the possible answers in half. If the test turns out one way you know the answer is in one half of the possibilities. If it turns out the other way you know it is in the other half. Either way you win with the answer. You have cut down the number of possibilities so your strategy is "convergent."
These are the basics. Red X, as practiced by General Motors, is much richer than this. It includes many clever methods for obtaining information and many clever strategies for quickly getting to the answers for difficult problems. This more sophisticated level of Red X problem solving is practiced by many companies around the world, engaged in almost any business you can imagine.
Where did Red X come from?
The 80/20 rule was first observed and popularized by Joe Juran. Dr. Juran was a professor at NYU. He observed the 80/20 rule in business and named it for Vilfredo Pareto, an economist who studied the distribution of wealth in different political systems and concluded the a very few people always wound up with most of the wealth. In 19481 Dr. Juran gave a special course in quality with Len Seder and Dorian Shainin2 as guest lecturers. The three of them infected each other with their ideas. Len Seder developed and published Multi-Vari and Dorian Shainin realized that Pareto applied to physical problems just as well as business problems. When building mathematical models engineers traditionally refer to causes as X's and effects as Y's. By the late 1950's Dorian was telling his clients that their problems were not caused by a little bit of each of many X's, they were caused by one dominant X, the Red X. The problem could be solved by finding the Red X.
What is Red X® Reliability?
Reliability is a step beyond quality. Quality is when the customer is enthusiastic about the new product she has just purchased. Reliability is when the customer is enthusiastic about what a great product it was after it is worn out (and she wants to buy another one). If an engineer is to be sure his product will be reliable he must know that the Red X's that control each of the product's critical characteristics are set to the right levels and that the product's manufacturing system keeps them there. When NASA asked for proposals for the Lunar Module (the space ship that actually landed Neil Armstrong on the moon) in the early 1960's, Grumman wanted the contract but saw a trap in the reliability specifications. Grumman hired Dorian Shainin as a consultant to help prepare their proposal. The proposal was successful and Dorian’s reliability concepts were used to create and test the Lunar Module. Dorian further refined the methodology on Pratt & Whitney's F-100 engine. Many products including Detroit Diesel's series 60 engines and General Motors first ABS brake system have benefited from this technology since. The Chevy Red X® teams at General Motors, highlighted in their recent television advertisement campaign, use these concepts today.
Why is an idea from 1948 so hot today?
Like the rest of technology since 1948 Red X hasn't stood still. Dorian Shainin Consultant, Inc became Shainin Consultants Inc became Shainin LLC, Shainin GmbH and Shainin Asia Ltd over those years. Dorian became a team of strong experienced engineers from around the world working to solve client's problems and to find faster ways to find and control the Red X's. There have been many improvements over those years. As the technology got deeper and more smart people worked together on it the improvements came faster. One day John Abrahamian3 introduced our company to a method of analysis used by design engineers to simplify a design. We all thought it was neat but we didn't quite know what to do with it. Adrian Hooper said, why don't we apply an energy balance to it like we used to do in school? In a few months we had a methodology for solving a type of problem that had stumped us up to that time. A few years later Chrysler asked Jane Hoying to solve a logistics problem. We had never done anything like that before. Jane took the Design analysis/energy balance combination and created a complete new methodology that we have used to create a purchasing system for Mercedes and a management system for MTU.See the accompanying Technology Development timeline outlining seven decades of growth in Shainin Technology.
Beyond Red X® basics . . .
The principle of the Red X provides a firm platform upon which strong problem solving strategies and tools have been developed and refined. They allow us to face problems not as new difficulties but as patterns we've solved time and again.