Trade-offs-free management via De Novo programming

Hayes and Pisano have recently observed that lean manufacturing has apparently eliminated the trade-offs among productivity, investment, and variety. In the same vein, Pine, Victor and Boynton speculated that companies can overcome the traditional trade-offs. This paper shows why and how modern business can aspire to the trade-offs-free thinking through the pragmatic and quantitative analysis of optimal system design. It presents both practical and theoretical arguments for trade-ops elimination and shows how profitability and productivity can be improved through identifying an optimal portfolio of resources. It is crucial how the levels of individual resources and assets are determined interactively, with respect to each other-i.e., as a system. Simple numerical examples and quantitative analyses of production situations, based on De Novo programming, are used to demonstrate the basic trade-offs-free principles. The race is on: how to transform production and management systems smoothly from the trade-offs-based to trade-offs-free. This race moves us well beyond the assorted World-class, TQM, Lean production or even Mass customization labels. Important corporate or network-based portfolios of resources will have to be optimized before any other relevant efforts could become truly effective in the global competition. Selected literature on De Novo programming is appended.