Topic: Management Improvement, Lean Thinking
Joel Spolsky writes the excellent Joel on Software blog and runs Fog Creek Software. Recently he has been writing about process improvement of the order fulfillment process for a movie on the experience of interns at Fog Creek Software, How to Ship Anything by Joel Spolsky
Shipping an international order now takes about 35 seconds, down from 3 minutes, and can be done by anyone, whether or not they have SQL and Mail Merge skills. Domestic orders are even faster since they don’t need customs forms. Most of all, it’s all really fun.
Joel is a great writer and tells a interesting story about of how they improved the process. This is one of a series of articles on the process improvement around order fulfillment for the documentary made of “project Aardvark”:
Four interns are brought into Manhattan and given 12 weeks to design, develop, debug and ship a program that will change the way computer geeks around the world fix their friends’ computers. Boondoggle Films presents a journey through the world of software development from the perspective of a unique upstart, four quirky interns, and the world of The Geek.
Shipping Update: “We discovered that 2 people working in tandem can ship an order every 12 seconds using the new system.”
The level of detail in his posts is great. Aardvark’d DVDs Ship; Final P&L:
Incremental Expenses (per unit)
$2.00 – DVD production and delivery
$5.00 – Royalty to filmmaker
$0.30 – Envelope for shipping
$2.52 – Postage (weighted average)
$0.20 – Other supplies for shipping (labels, paper for packing slips, toner, boxes, etc)
$1.00 – Shipping labor (estimate, since most labor came from Fog Creek employees on the payroll anyway).
Total per unit: $11.02. Since we’re selling at $19.95 that’s $8.93 gross profit.
$5,000 – Stipend paid to Boondoggle Films
$5,000 – expense reimbursement to Boondoggle Films
So we need to sell 1694 copies to break even. As of today, we’ve sold 2595, so we made a profit on the movie of about $8048.
And he really understands the value of the movie to his company, which I agree with:
Not bad! I was hoping to break even on the movie, and make a “profit” through more applications to our summer internship program from people who saw the movie and were inspired to work for Fog Creek.
I want to work for them. More reasons to work for them:
- Fog Creek Software Management Training Program – our previous post on the Management Training Program
- Fog Creek Compensation
- Bionic Office
- Incentive Pay Considered Harmful – “If you’re in this position, the only way to prevent teamicide is to simply give everyone on your team a gushing review. But if you do have any choice in the matter, I’d recommend that you run fleeing from any kind of performance review, incentive bonus, or stupid corporate employee-of-the-month program.”
- The Joel Test: 12 Steps to Better Code