1. FAVI.
“Le chamallow”
International Center for
Page 1
Outperformance

2. quot;The world is uncertain. Life is uncertain!
“Everything is out! Unfortunately, most Obviously! So why do manager always want some?”
organizational charts are a picture of a
huge inside, with no formal entry or exit, quot;The characteristic of our FAVI system is that we
like a huge “stomach” which would be voluntarily make uncertainty an adventure, a celebration.quot;
sealed at both ends: neither mouth nor ..“
JF Zobrist, former CEO FAVI
JF Zobrist, former CEO FAVI
“One of the first things I did 23 years ago
“In the “square” enterprise, a prisoner of the is to remove the score, the bonuses,the employee
annual budget, the major tool of the control of interviews and other evaluation tools and
the future, all actions are bordered by this therefore the staff.”
budget and are planned on a YEAR! And
anything that is not budgeted may not be!“ JF Zobrist, former CEO FAVI
JF Zobrist, former CEO FAVI
quot;The only power lies with the customer,quot;,
quot;I have no power in here. I enter a meeting,
no one stands up. I don't have a parking
space, and if I start pretending to expertise in a
“It's a company -- in France, remember -- where meeting, my people will often cut me off.quot;
workers volunteer to work Saturdays when an
extra-large order needs to be filled by Monday, JF Zobrist, former CEO FAVI
where front-line employees redesign products
to improve efficiency, and where prices
have fallen almost every year for decades.”
Brian M. Carney
In a quot;SQUAREquot; world
FAVI is quot;ROUNDquot;!”
JF Zobrist, former CEO FAVI
“To return to the company quot;Yquot;, this company is
certainly on a budget, just to mark the future, but “If we want to survive, we must adopt a
we do not hesitate to modify it if the consumer structure where everyone has an antenna
happiness turns suddenly, we do not hesitate to and is outward in order to adapt to market
burn it if a September 11 like two towers go up in developments.”
smoke!”
JF Zobrist, former CEO FAVI
JF Zobrist, former CEO FAVI
“The greatest productivity gains we have made are
very often the result of a reflection made by chance
“There is no happiness without performance.
by an operator of production.”
To be happy one must be responsible, he/she
must be free of the quot;Comment*quot; because after
all, and this is one of the basics of Kaizen” “In addition, we quot;go outquot;, we especially encourage
all operators to quot;come outquot; to multiply the chances
JF Zobrist, former CEO FAVI to meet quot;accidentsquot;! In quot;postquot; the accident made us
discover the fabulous track electric motor's high
*FAVI refers with “comment” to the chain of efficiency; In quot;postquot; we discovered most elements
command of our internal culture.”
Page 2
JF Zobrist, former CEO FAVI

3. FAVI.
“Le chamallow”
Table of Contents
Introduction to the Case Study.........................................................................................................................4
Short company overview...................................................................................................................................5
Assumptions held about human nature at FAVI................................................................................................5
Management practices listed by Beyond Budgeting principles.........................................................................6
Overview: “What FAVI does not have”.........................................................................................................6
Customers...................................................................................................................................................6
Organization, autonomy & responsibility......................................................................................................7
Values........................................................................................................................................................12
Transparency.............................................................................................................................................14
Goals & Controls........................................................................................................................................15
Rewards....................................................................................................................................................15
Planning.....................................................................................................................................................15
Resources..................................................................................................................................................16
Coordination..............................................................................................................................................16
FAVI's transformation stories..........................................................................................................................17
Mr. Zobrist's quotes on “the break”............................................................................................................17
Mr. Zobrist's speech on Christmas Day.....................................................................................................18
Production increase after the Christmas holidays......................................................................................19
The story of the parking space –
or the importance of a strong signal to mark the transformation journey...................................................20
Mr. Zobrist's letter to all associates............................................................................................................21
The story of the creation of the mini-plants ...............................................................................................23
The story of the quality at night..................................................................................................................23
The story of the red traffic lights.................................................................................................................23
The story of Gilles......................................................................................................................................24
The story of Fabienne................................................................................................................................24
FAVI's own invented management terminology..............................................................................................25
FAVI's principles.........................................................................................................................................25
Enterprise Y vs. Enterprise X.....................................................................................................................28
“The love of the client”...............................................................................................................................32
Lotto / Lottery.............................................................................................................................................33
Origins of FAVI's management model and the management model sheets....................................................33
Resources.......................................................................................................................................................36
License...........................................................................................................................................................36
Version 1.1: June 2009 (Version 1.0: May 2009)
Page 3

4. Introduction to the Case Study
FAVI in Hallencourt, France, is considered since May 2009 a Beyond Budgeting Pioneer. It was both
identified and documented by us. FAVI is the first French pioneer. It is a remarkable case under the
centralized and five-year-plan French culture. FAVI's former CEO Jean Francois Zobrist under who's
leadership FAVI transformed, described France as the quot;last Soviet Republicquot;.
Despite FAVI has compared to other beyond budgeting pioneers a relatively small workforce with currently
about 800 associates, it is one of the most mature and best self-documented cases ever found since the
beginning of the Beyond Budgeting journey in 1998. Actually no primary research is necessary due to its
both excellent and on the website complete freely available documentation (in French). FAVI has
documented its own way of operating both in principles compared to the traditional command-and-control
management model, the underlying and self-invented concepts of “Enterprise Y” / “Round enterprise” in
comparison to the traditional “Enterprise X” / “Square enterprise” and also its transformation journey
beginning on Christmas Day 1983. With reference to the evolution pathway it is a transforming organization.
As the transformation started on January 1984, there was no clear model how the new management system
should look like. Moreover Mr. Zobrist stresses that by change and accident the FAVI system was developed.
The transformation to the new management model soon bear fruit since FAVI's associates multiplied by 6
times, the turnover increased over ten times, and more than 20 years later, FAVI has still a very strong
position worldwide among its competitors.
According to FAVI: “The essence of our management is humility. We therefore do not claim to be a model!”
Furthermore FAVI's opinion towards money is like many other Beyond Budgeting pioneers (e.g. dm
drogeriemarkt, Schindlerhof, Semco) in Mr. Zobrist's words: quot;Money is definitely not the aim of the company,
this is only a means, like breathing is the major way of life!quot;, “Money is the breath of the company!”. Also the
notion of “enterprise” or “company” does not suit FAVI which considers itself to be a community.
Page 4

5. Short company overview
FAVI is based in Hallencourt, northern France, in the French region of the “Picardie”. It was founded in 1957
and has today over 800 associates (not employees!) with a turnover of about 91 million. € (30% from export).
Its product areas include the design, optimization, validation, die-casting, machining, assembly and
marketing of all components that can be made of die-cast copper alloys. In this special market niche it is the
world leader. The main customers are from the automotive industry e.g. PSA (Citroen, Peugeot), Renault,
Fiat, VW, Audi, Volvo. The main products with an European market share of over 50% are automotive gear
boxes. Sales offices do exist in France, Germany and the UK. Since January 2004 FAVI is a member of the
United Nations Global Compact. FAVI was awarded with the following quality awards:
• The 1st European foundry to be certified ISO 14001 in 1997
• The 1st French foundry to be certified OHSAS 18001 in 2000
• The 1st copper alloys foundry to be certified ISO/TS 16949 and ISO 9001
• The 1st European foundry to be certified ILO-OSH 2001 in 2008 (AFNOR Certification)
Further it is one of the first companies worldwide that adopted the 5S of Kaizen, it is not unionized, and most
of all FAVI makes money in markets in which its competitors lose money or have long since outsourced
production to Asia.
Jean Francois Zobrist served as CEO from 1983 – 2004.
Assumptions held about human nature at FAVI
Directly influenced by Douglas McGregor's landmark book “The human side of enterprise” assumptions
about human nature at FAVI represent Theory Y.
During the transformation in the 80s, Mr. Zobrist removed every management practice related to Theory X:
the individual bonus, the clocks, the evaluation interviews, scores, etc, including the complete HR
department: “because this department's main job was to put constraints on people's activity and grow its own
ranks to enforce these constraints.quot;. In line with Theory Y are FAVI's motivation levers: creativity, to be one-
self, empathy, love, absence of power, differentiation, curiosity, and intellectual freedom.
Page 5

6. Management practices listed by Beyond Budgeting principles
Overview: “What FAVI does not have”
At FAVI there is/are no:
Management Chief Production Officer
Middle Management Chief Technical Officer
Staff Chief HR Manager
Company planning Chief Workshop Officer
Production planning Team leader
HR department Individual bonus
Production department Locked door
Purchasing department Time control
Marketing department Fixed working place
Pay instructions department Fixed working time
Methods department Fixed quota
Employee evaluation Processes
Customers
“The classical organizational chart in which the boss thrones at the top,
makes to think that he pays, especially as the client does not appear on it.
Similarly, the beautiful word quot;employerquot; encourages this approach that the boss pays!”
JF Zobrist, former CEO FAVI
At FAVI each network cell is aligned to market-pull from their internal or external customer and not to
hierarchic relationships. Accordingly only reserved parking spaces do exist for customers, and not for any
associate. And who will be late has to park at the end, so that every associate can see it. In the same way
are designed the toilets: the best toilets do have the customers, all other associates have toilets of the same
quality.
Page 6

7. Organization, autonomy & responsibility
At FAVI there is no departmentalized hierarchical structure, but 21 independent network cells. Despite FAVI
claims itself to have “no structure” there is clearly a cell structure in place, and even an organizational chart
available. The organic organizational structure at FAVI is entitled “le chamallow”: the marsh mellow.
The network cells are at FAVI called “mini-plants” and each network cell is either aligned directly to one
external customer like Fiat, VW, or PSA (Peugeot Citroen), to a special product field, or an internal customer
(internal service cells). Furthermore the 21 cells are divided into 5 internal service cells, and 16 production
cells:
The service cells include:
• Commercial
• Office study
• Laboratory
• Quality
• Administrative
The production cells include:
• General maintenance, machinery
• Mold maintenance
• Manufacture of molds and tooling
• Automotive foundry
• Casting parts miscellaneous
• PSA Valenciennes
• PSA Borny
• Citroën
• Volkswagen
• Audi Getrag
• Renault
• Fiat
• Volvo
Page 7

8. • Various electrical parts, locks, water, health ...
• Water Meter
• Copper rotors
Before the transformation in the 80s there were 8 hierarchy layers, whereas there are nowadays 2 levels of
hierarchy left. Within “le chamallow” there is no HR department, production department, purchasing
department, marketing department, pay instructions department, and methods department. All these
functions are totally devolved to leaders and their operators within the network cells. Usually each mini-plant
is responsible for the following tasks: production, planning, marketing, purchasing, delivery & logistics, order
management, supply management, the management of schedules and holidays, investment plans, HR
recruiting and training, the improvement of machinery, and safety.
Exceptions from the cell structure design are the following remaining tasks, which are offered as services to
the mini-plants:
• Research and Development
• Quality
• The merchant: Their role is to bring the outside inside
• The leaders of progress: they have no function or functional hierarchy, but they have the mission to
advance and assist mini-plants and operators
• Administrators: they ensure the balance sheet and the operating accountings monthly, the
procurement management, and the social assistance
The 21 network cells are each fully independent, but also work functional and operational freely in informal
networks without central coordination. Further the principle of equality without strictly hierarchical
relationships is strictly applied both within and between mini-plants.
FAVI's organizational chart is entitled “le chamallow” (the marsh mellow). The center of “le chamallow” is the
customer in the middle of the company, the merchant / productivity sponsor are interfaces between the mini-
plants (the network cells). The whole FAVI community is surrounded by a boundary which is represented by
the partners, who are the city, the shareholders, and the suppliers. The chamallow is an organic biological
structure, indeed this is a fact, but was never the goal of FAVI. The notion “le chamallow” is originated from
the values it represents as Mr. Zobrist points out: “Let us not forget that nothing sustainable exist without
values based on simple, robust and pleasure, which is why we adopted this definition of quot;organizational
marsh mellow”.”
Page 8

9. “le chamallow”:
city
suppliers
VW
CEO
ISO 180001
Fauvet
Volvo
Ohno
$
Fiat
PSA
McGregor
Kaizen
ISO 140001
shareholders
Client
Merchant / Productivity Sponsor
leader
Source: FAVI
Page 9

10. Roles within “le chamallow”:
The mini-plant:
Each mini-plant has an internal or external client or is responsible for a certain sector (water meters,
rotors ...). According to FAVI the responsibility of each operator causes happiness, which causes in return
performance.
Each mini-plant includes about 20 to 35 operators, several teams, and it is a location that includes all the
machinery and processes attached to a client (or area). Each mini-plant has a leader, who is selected and
dismissed by the mini-plants operators on a consensus decision.
Both the single operators and each mini-plant is autonomous and responsible for their work. For example
under this autonomy without review committees and managerial approval:
• the associates on the factory floor have redesigned their own work spaces to improve their own
efficiency
• an associate suggested a product redesign that cut in half the number of rivets the company was
putting into a particular auto part. In this way, FAVI has reduced the cost of producing a gearbox fork
by 40% in real terms over two decades
• One associate designed a cart that made the parts she was assembling more accessible, and
designed a rake to help her pull the parts out of a large box
• Another associate figured out a way to drill a hole with one drill bit instead of two
The leader:
On FAVI's premise that there is no performance without happiness, and that to be happy one must be
autonomous, the mission of the leaders is in line with the devolved leadership style of Beyond Budgeting in
Mr. Zobrist's words: “To contribute to help the operators to be more independent! And not to control things, or
anyone else!“ Furthermore the leaders are equal to operators from the mini-plant and usually stay with them.
The leader is himself/herself always a former operator, who has a tested and by his peers recognized talent
of leadership. Typical tasks of the leader are: occupational safety and health at work, compliance with
internal and external environmental policies e.g. the principles of the Global Compact, organization and
meeting of deadlines and schedules, wages and salary increases, hiring and mentoring new associates,
animation of his/hers mini-plant.
Page 10

11. The merchant / the productivity sponsor:
As the sponsor or patron of his/hers mini-factory, the merchants or productivity sponsors as they are at FAVI
called have the means to meet the commitments made with the client. The merchant's role is to bring the
outside in, by conveying the maximum information from the customer to his/hers operators, on the strategy,
new products, changes, etc. And vice versa to pass information from the mini-plants back to the client. This
is done usually formally during a monthly meeting of the mini-plant where the merchant provides all
information of the new client, and vice versa by informal tours through the mini-plants. Sometimes the
merchant calls the customer to come directly to the operators to explain a particular point. Whenever
possible the merchant puts all associates of his/hers mini-plant in a car and goes with them to the customer.
Typical tasks of the merchant are: prospecting, the animation of his or hers agents abroad, the receipt of
applications prices, the preparation of forecast ranges, the definition of the margin, the definition of the
needed investment, both for new parts to increase the productivity of his/hers mini-plant, research and
monitoring of suppliers or service providers, packaging, transport, the animation of his/hers mini-plant as a
quot;godmother or godfatherquot; of productivity, project reviews as a project manager, delivery times and product
quality of his/her client until the end of life of these products.
The merchant has neither objectives nor reward bonuses. The merchant is aligned to the market-pull from
the customer.
The CEO:
The CEO is in Mr. Zobrist's point of view to be a bit like the electron of the hydrogen atom: everywhere and
nowhere, but not offensive. The CEO is placed at the interface between the inside and the outside, listens to
weak signals internally and externally, he/she is trying to quot;feelquot; the process, and helps the operators to sense
the pitfalls and opportunities. He/she is in Mr. Zobrist's words a “guarantor of the adequacy of the evolution
of the community”, the CEO is concrete responsible for the consistency of the community. When asked who
is in charge at FAVI Mr. Zobrist responded: quot;The only power lies with the customer,quot;, quot;I have no power in
here. I enter a meeting, no one stands up. I don't have a parking space, and if I start pretending to expertise
in a meeting, my people will often cut me off.quot;
Finally Mr. Zobrist concludes with reference to FAVI's structure: “Therefore until the establishment of this
quot;lack of structure”, we have never, ever once delivered late!”
Page 11

12. Values
Like every other Beyond Budgeting pioneer, FAVI is governed through a few and clear values, mission /
vision statements, and rules. These are in the case of FAVI:
Values:
• Good faith
• Sense
• Goodwill
• Good mood
Mission:
“Everyone should seek permanentquot; LOVE quot;of his/her clientquot;.
Creed:
“quot;The other is always considered to be good!quot;
[...]
An initial EVIDENCE:
quot;The performance comes from the operators and alone from them!quot;
[...]
A second EVIDENCE:
quot;There is no performance without happiness!quot;”
Strengthened and believed in these principles FAVI has collectively developed a very simple system:
quot;Always more and more for less for each of our client, HALLENCOURT in respect of the land of our
childrenquot;.”
MAIN:
quot;Live and grow in our village PICARDIE1quot;
MOTTO:
quot;BY AND FOR THE CLIENT”
1 The “Picardie” is a specific region within northern France, the advert/adjective is “picarde”
Page 12

13. FAVI's rules:
“The quot;Yquot; opens up spaces of freedom for everyone, bordered spaces, limited by a limited number of simple
rules! “ (Zobrist) In the case of FAVI there are two rules:
1) THE MAN IS GOOD!
2) EVERYONE IS PERMANENTLY SEARCHING THE LOVE OF HIS/HER CLIENT!
These 2 basic rules of FAVI are broken down into the following operating principles, which are according to
FAVI so simple that both leaders and the operators can understand them:
• METACTION
• The DODO rule (No control of the activity)
Rule of the LOTTO / LOTTERY (s. below)
• Nothing a priori, but entirely posteriori
• No over-rigid rules
• Search for consensus
“Performance formula”
“The performance comes from the operators!
There is no performance without happiness!
How can the operators be happy?
When all conditions are in place, and that the moral conditions are adopted, respected and experienced in
everyday life; then and only then we can consider that:
• To be happy one must be responsible!
• To be responsible we must be aware of what and for whom are his/hers actions!
• So be in direct contact with his/hers customer!
• Be Totally Free on his/hers actions!”
Page 13

14. Transparency
Generally the annual balance sheet and the monthly financial reports are open to everyone and Mr. Zobrist
insists that only details are provided. During FAVI's transformation journey Mr Zobrist trained all employees
on cost issues.
Additional to the financials, each month since 1983 the so called “FAVI information file” is available to every
associate, nowadays available on the intranet and on specific electronic tables within the factory . The “FAVI
information file“ contains usually the following topics:
• Travel (dates, companies, places visited, people involved)
• Visits (company name, dates, time ,visitors, purpose of the visit)
• Meetings (dates, subject, time, persons concerned): The meeting section contains general meetings
which concern every associate and therefore are open for everyone to participate, e.g. the monthly
mini-plant meeting
• Miscellaneous: This section allows every associate to express themselves, ask questions, provide
information, to clarify its absence or passing messages to strengthen self-preservation, or
appreciation.
• HR: like an internal talent market this section offers information on available associates. Usually the
associates move informally between teams and mini-plants
• Customer information: this section includes information about all news from the customers, the
competitors, and the market
• Classifieds ads: this section contains an internal market for all associates to sell personal things e.g.
cars, aquariums, etc
• Congratulations
• Case of the dragon: this section includes daily problems and is an important lever for the
improvement program. Usually volunteer associates commit to solve these problems. The name is
related to the original hard-copy file which was placed besides a brass dragon.
Furthermore the CEO writes each month a report about general company news, deals with customers,
expansion, quality problems, diversity studies, etc. This file is both available at the electronic information
panels in the mini-plants as also a a hard-cover letter to take home.
Page 14

15. Goals & Controls
At FAVI there are neither fixed nor relative goals and only one KPI does exist: the cash flow. As Mr. Zobrist
points out: “Home at FAVI there are absolutely no fixed targets, we are aware that they are all the best to
prepare for the future of their operators, furthermore they have absolutely no financial bonus because their
real income for them is the number of productive jobs created.”, “We all know the examples of regular
cheating, highly prejudicial to the company, to stay within the objectives imposed!”, “The numerical figure
discourages imagination and initiative. Say to your people: we must lower the costs 3% is stupid because we
can perhaps do more, or it is perhaps impossible to achieve 1%. We prefer verbatim: quot;Always more and
more for less, to Hallencourt in respect of the land of our children, for example, because it does not block the
imagination, all is aimed with different objectives:
quot;Always more and betterquot; = quality, safety, health
quot;For less expensivequot; = productivity, competitiveness
quot;A Hallencourtquot; = instinct of long-term
quot;In respect of the land of our childrenquot; = Sustainable Development””
Rewards
At FAVI there is only a basic salary without a bonus or a profit share.
Planning
At FAVI there is no company planning, generally it is considered that “action must be taken every day to
adapt to this, but against this one should not limit his/hers thinking to the framework of the classic five-year
plan but to think much longer term to see the possible developments.”, “The strategy for us is a proposal for
actions to follow these successive over a maximum period of one year. The strategy focuses on quot;whyquot; and
quot;whoquot; of our actions. It is therefore of utmost importance that those who present the successive daily
(Operators) are fully aware of why and for whom.”
To present the strategy each year a special meeting is set up with the leaders and the productivity sponsors.
They present and comment the strategy to the operators resented and commented to operators of each mini
plant. After the meeting the strategy is then displayed in each mini-factory for the reminder of the strategic
coherence of the actions of the year.
Page 15

16. Resources
FAVI does have a budget, but this a more like to mark the future, and it allows each month to compare the
actuals against the plan to question the current situation, but is it not an an imperative guide. This one-month
budget is prepared by each network cell's leader and sponsor and can be seen as conclusion more as a
one-month rolling forecast.
Coordination
FAVI is completely aligned to market-pull and not to its budget.
Page 16

17. FAVI's transformation stories
Mr. Zobrist's quotes on “the break”
“The company is a form of monarchy, the only way out is to do a REVOLUTION! A revolution at the base. [...]
The revolution can only come from the top, the HEAD! So it is no longer a revolution is is a BREAK!
BREAKAGE is in my opinion the only way to move the company quot;Xquot; to the company quot;Yquot;! [...]
WHAT ARE THE CONDITIONS TO BREAK?
None!
WHAT ARE THE PREREQUISITES TO BREAK?
None!
WHAT ARE THE TOOLS OF THE BREAK?
There are no!
But incoherent break results in CHAOS!”
“Whatever the evolution, by breaking or by negotiation, we must never, never someone to be left on the
wayside.”
“One of the first things I did in the 80s was to remove the pointing, clocks, bells, bonuses which were up to
20-25% of the wages (by incorporating the average of what everyone had on the last 24 month), doors of the
factories, in short, all of which started from the principle that man is bad. To my surprise, we quickly found
that the rates increased when we had removed the timing analyzer and regularly operators remained ¼ hour,
for, of course, finish before their shift.“
Page 17

18. Mr. Zobrist's speech on Christmas Day
On Christmas Day 1983 Mr. Zobrist hold the following transformation “speech” to start the transformation:
quot;It's been 9 months that I am among you. 9 months to a child! 9 months that I look at you, and I see brave
people, great professionals who love their job, with that ability to work! And I came to the conclusion that
people like you who have your skills do not need a carrot or stick indeed! The carrot and the stick are
unworthy of professionals like you! Therefore, when you resume work in January, the clocks will be removed!
If, by accident, because everybody can have an accident, you arrive late, we will look at all the reason for the
delay and if such a problem is a motorbike, rather than punish, which does not solve the problem, we will
help you to repair the motorbike. There will be no more scoring or timing, you are not paid for overtime
hours, but for parts and good parts! That is why the ring tones will also be deleted! There will be no more
bonus either, what everyone has earned since 2 years that will be kept! We therefore take the average of
what everyone has had on these last 2 years and we put it in the salary! There is not a thief among us, that's
why the door of the store will be dismounted. [...] There will be no longer distributors of paid drinks for, but in
each workshop, two distributors of fresh water with syrup, and hot water with sachets of coffee and sugar.
We will remove the keys to each wheel and provide a lot of machine tools, and more for everyone to equip
themselves as they wish, all employees of the company will have a check of 500 F to buy whatever they
want as long as it has to do with work.quot;
Mr. Zobrist pauses to measure the reactions that were more the domain of astonishment than satisfaction. In
an impressive silence he continued: quot;There will be no more unemployment! If one day we are forced to
resort to such measures, then I will be first senior unemployed, even me. There will never, either, meal
frameworks, we eat all together or we will not eat!quot;
Mr. Zobrist then turned to the executives who were naturally grouped and pursued: quot;How will we do to
operate in the future? Actually I do not know! I am sure you deserve that we operate differently, but I do not
have a replacement model! I propose that together we are going, with people of good faith, common sense
and goodwill.”
Page 18

19. Production increase after the Christmas holidays
The only thing that Mr. Zobrist decided to do within Christmas Holidays was that henceforth he would never
speak to workers, but to OPERATORS!
Now everyone, including Mr. Zobrist, the CEO, would be counted as a worker that is working in the interest of
the client.
When Mr. Zobrist arrived at his office after the Christmas holidays, his manufacturing managers were already
waiting for him: quot;You do not know them! It will be a mess! It has always worked like that, how you want that
to be respected if there are more rewards! They will cut all! The rates will collapse. ... quot; Mr. Zobrist then left
them speaking for half an hour this way without saying anything.
But against all odds and the complaints from the manufacturing managers the production rates did not raise,
but increased by 20%! And only counted by the inbuilt counters of the machines...
Mr. Zobrist was so surprised, that he didn't dared at first to talk to the operators, because he feared that this
unexpected phenomenon would not continue! Only after a few weeks shy, Mr. Zobrist asked the operators
why and how they were able to do the same production? He than received two types of answers:
• quot;This is to help you prove the quot;headsquot; that you're right!quot;
• quot;There is a rhythm that helps pass the time!quot; In other words they were working at the optimum
physiological rhythm with less energy, which proved to be significantly faster. And when Mr. Zobrist
asked them why they did not do that before when there were bonuses? He always received the
same answer: quot;We're not crazy. If we had done that we would never had the bonus!quot; They were
aware that their quot;leadersquot; would have increased the quota!
Page 19

20. The story of the parking space – or the importance of a strong signal to mark the
transformation journey
As the transformation went not so so good in the beginning, Mr. Zobrist invited a friend of him, because as he
stated: quot;I'm tired of my staff who fall asleep, inertia that blocks any attempts to change.. Come rouse, I want
to change and transform the way we work to restore power to the productives!quot;
So Mr. Zobrist set a meeting with his friend at 9 o'clock in the morning. His friend arrived in time and there he
found FAVI with its of about 500 associates a that time in a provincial area in the Northern France. He
discovers a beautiful plant with on the right of the door flower beds and left a few parking spaces with the
name of his host in the first, nearest the door, then a dozen other names. Then he parked his car on the
visitors places in the general parking area, a hundred meters on the side of the plant.
After exchanging the traditional French greetings, he confirms his willingness to make a difference in this
organization. Then he requests to Mr. Zobrist be accompanied to the door of the factory and there, taking his
mobile phone, he said: quot;Well we will start immediately: call your maintenance department and ask them to
come immediately to remove your name and other names on this car park and immediately put on pieces of
wood or even cardboard, with the description: quot;CLIENTquot;!” Then the owner, his mouth and eyes opened,
haggard said: quot;Well yes! But you do not understand that you still need them as I speak .... I still cannot ...quot; He
interrupted: quot;Wait if you do what I say in an hour, the entire company will know that something is changing,
and so the movement will be started!quot; quot;Yes but no, I still cannot do that to my staff, they do not understand!quot;
quot;Ifquot;, he said, quot;They understand that people are the most important customers, not themselves, and especially
that allow them four times a day to cross the same parking on all staff and can be of exchange even a hello.
And then your workers will understand also that the most important people are neither you nor your staff, but
the score!quot; quot;Yes but ...quot; He insisted: quot;It takes an action, however symbolic, although it may seem a
caricature, to give credibility to your intentions, otherwise your will to change will be vanished, sterile
meetings will take place ... only action visible and irreversible does account!quot; Faced with its inability to act, he
gave him his phone in the pocket and left, saying: quot;If you are not capable of something so simple, does not
change anything, and my speech will only strengthen your leadership in its passivity, as best I will dream for
nothing, at worst I'll go for a dangerous agitator, and my testimony will only serve to give them arms to block
any change them more or less involved!quot; quot;Goodbye my friend!quot; And Mr. Zobrist's friend left FAVI.
As this friend was almost honest, a few days later Mr. Zobrist called his friend to thank him for the lesson,
and then carried it out alone, without external help at his own pace, concrete action, including changing the
parking plates. So he had unknowingly issued this strong signal that marked the transformation.
Page 20

21. Mr. Zobrist's letter to all associates
The following letter from Mr. Zobrist was sent on 15 th April 2000 to all associates of FAVI on a Saturday
morning to the associates' private address in order that everyone can think calmly throughout the weekend,
and possibly share with their families and friends:
“SPECIAL INFORMATION ON 15th APRIL 2000
DREAMS:
The 15th April date is a bit special for me:
It was on the 15th April 1967 that I started to work.
It was on the 15th April 1983 as the Grand Patron [the owner of FAVI] told me the direction of the company.
When I arrived here, I have already been working for 16 years for the Grand Patron, and I knew he would leave me free
to run the business, as long as I grow.
When we know we have all freedoms, we can dream!
So I DREAM!
At the time, the worker was working, the adjuster settled, the controller controls, and the quot;bossquot; organized.
I dreamed of a company where the worker becomes an operator, who could organize, set up its own machine, and self
control! At the time, workers pointed, and were punished for any delay (5quot; delay = 5quot; to pay less, 10quot;= -15quot; on wages, 15
quot;= -30quot; etc ....).
I dreamed
- A business where everyone recognizes that we work for a client, and not for a clock
- A business, where rather than punishment happens, we would inquire about the reason for the delay, since no one
deliberately be late and, if necessary, shift the team with the young dad whose little girl cried at night, or troubleshoot the
service maintenance for a damaged motorbike, because of being late!
At that time there were up to 25% of salary consists of a bonus (much of which depended on the quot;moodquot; of the boss)
that was granted or not, every month.
I dreamed
- A company where the bonus would be included in the salary, so that the mother is guaranteed the same monthly
income,
I dreamed
- A system for sharing results, just and equitable. I must confess that I never dreamed that this quot;bonusquot; can be achieved
(with reference to the average wage in the metal industry) the equivalent of 17 months salary!
At the time, there was systematically unemployment by turning workshops down, to maintain a quot;healthy pressurequot; on
workers.
I dreamed
- A company where there would be no more unemployment, and where, if one day this misfortune occur, it would be
supported by all, not only by the workers!
At the time, everything was locked in stores, even the safety equipment and consumables.
Page 21

22. I dreamed
- A factory where everything is open, even the office, where everyone could freely have all the tools it deems useful to
have!
At that time we did that cast parts with little value added.
I dreamed
- A company that would do more for the customer, making parts optimized, tested, machined, assembled, according to
complete!
At the time, no worker requested that their job was based on his hands and his muscles.
I dreamed
- A company where people use their brains to be the author's own progress, and their heart to seek the esteem, respect,
a form of love of their client!
At the time, only the boss knew the customers.
I dreamed
- A company where everyone would see his client could visit, and meet him!
I dreamed
- A business model that we visit, which is a reference!
After 33 years of career, and 5 years of its purpose (if God and the laws allow), what is my dream?
Oh, my last dream is simple, but very difficult to achieve, simply because:
I dream that in the company, everyone behaves like at home, no more, no less!
At home, we do not throw their butts on the floor!
At home, we decline to pick up a paper or a cloth!
At home, we are washing your hands!
At home, we save water, electricity, heating!
In our garage or workshop, we range and maintains his tools!
In our garage, we does not waste or grease, or bolts, or rags!
In our garden, we respects the flowerbeds and flowers!
In our driveway, we do not empty the ashtray of his car!
In our car, we picked up and throw the useless paper, we empty the ashtray, avoid soiling the carpet with mud, or stain
the seats with grease!
In our village, young people say hello, and respect for elders!
Why each of us does not even do that at the company?
This would be so easy, so simple, and even more reasonable when we do not have the tools, cleaning, lawns, cars, we
all pay for their work (Langlet society for tools, Trancart for plantations, Sinka for cleanliness, SG guard for ...). I say we
pay, not the company, as the Company does not exist physically. The company is us, our work, our intelligence, our
courage, our sweat!
You see, my dream is simple, reasonable.
Every one of you behaves at the company like at home!
It's simple, but that I cannot do it alone!!
JFZ”
Page 22

23. The story of the creation of the mini-plants
Gilbert came to see Mr. Zobrist in his office, sitting nonchalantly in front of him and said to him : quot;we must
turn Dédé!quot; At the same time as Gilbert spoke, Mr. Zobrist realized he was right, he knew the unconscious,
but his emotional ties with André, Dédé, the boss of machining, could not see this so obvious.
Mr. Zobrist then said to Gilbert: quot;Unfortunately, I think you're right, but it is not possible.”
And indeed he understood that fact and that Dédé was programmed to fly a dozen people but no more, they
sought of gaining more and more new parts machined and the Dédé span of control was quickly increased
from 10 to 80 people. Reflecting with Gilbert, they said: “How can we reduce the number of people in direct
dependence on Dédé less than 10?”
And that's how the idea of autonomous groups was invented. Each “cell” was committed to an external or
internal client or a family of products, each with a leader, this way each “cell” could independently manage its
own orders and its own products. Quickly, this idea was taken by the Task Force on a Friday morning, when
it was decided to call each of the “cells” a mini-plant to show the degree of autonomy, and thus strengthen
the individualistic axis.
The story of the quality at night
One day Mr. Zobrist asked Jacques, the head of quality, to identify the percentage of quality problems,
internal as external, generated at night. To his surprise Jacques noticed that over the past two years, there
had been none! All problems have been generated only in the old days in the presence of the old power
based structure.
The story of the red traffic lights
One day Mr. Zobrist drove in his car and had to stop before a red traffic light somewhere on the countryside.
As he looked in all directions, there were no other cars or people wandering around. So he decided to ignore
the red traffic lights and to drive forward. Unfortunately this traffic light was monitored by a French police
officer who noticed that ...
From Mr. Zobrist's point of view there was in short a red light with no need to justify a police officer
monitoring it. Back at FAVI he scheduled a meeting with all the leaders and productivity sponsors by telling
the story and asking them to look into the mini-plants if there were also such stupid traffic lights with
associates monitoring them that hampered the whole system.
Page 23

24. The story of Gilles
Gilles was a graduate of the Ecole Supérieure de Fonderie in engineering and had worked for 4 years at
FAVI in different functions like R&D or customer support. One morning after the transformation he came to
see Mr. Zobrist, CEO of FAVI, in his office sheepishly saying: quot;You know, Jean-François, I'm an engineer and
merchant / productivity sponsor is not the role of an engineer.quot; Mr. Zobrist asked him what he really wanted.
It came out the Gilles wanted to be a leader with status, with a secretary, and a reserved parking space
which actually did all not exist at FAVI any more.
Mr. Zobrist explained Gilles the FAVI system, however he noticed that it didn't impress Gilles. After a quarter
of an hour of discussion, Mr. Zobrist finally said: quot;Let's be clear Gilles, will you go away?quot; quot;For sure!quot; Gilles
said sheepishly. Visibly relieved by this statement because he had feared a reaction from the CEO
emotionally, Gilles said: quot;OK, we no agree, I will send you my resignation.quot; Then Mr. Zobrist handed a paper
and a pen to Gilles: quot;No, Gilles, if you go, you go! So you give me your resignation immediately and simply,quot;
for reasons of personal convenience, I give you my resignation request etc. .. “quot; After some hesitation, Gilles
filled the paper, and handed it to Mr. Zobrist saying: quot;OK, listen, during my 3 months notice, ...quot; Mr. Zobrist
interrupted immediately: quot;No, Gilles! I love you well but you do most for your family. You have freely chosen
to leave, you go! The community is going to pay your 3 months' notice, in accordance with the law, but it is
11 am, you have 1 hour to put your pens and your gum and at noon we drink some champagne together to
thank you for what you brought to the company during these 4 years, and you're going.quot;
The story of Fabienne
One day, during the usual visits of the factory, Mr. Zobrist stoped at Fabienne's workstation and recognized a
detail that he had never seen before: Fabienne's wrists were surrounded by a brown paper sticker which
were normally used to close cartons. Then Mr. Zobrist asks Fabienne: quot;Why do these improvised bandages
mean?quot; Fabienne replied: quot;Well Sir, it has always been that way! As this alloy is very dry, it makes little spicy
chips that fit into the sleeves which is unpleasant and embarrassing.quot; Mr. Zobrist replied: quot;But it is
unacceptable that you accept to work under such conditions. I can not understand why you never responded
Fabienne and I forbid you to continue working together. It is unworthy of you!quot; Immediately he calls the
telephone operator for the maintenance to the machine and said: quot;You have the night to do something but I
do not allow you that this machine is running.”
One the next Saturday morning when Mr. Zobrist had forgotten something at the office, he went as usual
through the factory and usually does a quick tour through workshops where he meets Fabienne who was in
the process of repainting her machine! Mr. Zobrist was very surprised by her presence, and she admits that
her machine now worked better, she also wanted it clean and nice, doing it on a spontaneous and voluntary
approach. This machine became then her machine.
Page 24

25. FAVI's own invented management terminology
FAVI's principles
The first part refers to the “round” enterprise, the second part refers to the “square” enterprise”:
• Management of uncertainty / Management of certainty
• Adjust to the present / control the future
• Act for 1 day, think of 20 years / act for one year, think for 5 years
• The performance comes from the workers / performance comes from the structure
• To be happy one must be responsible / only the elite has the right to have a project
• Focus on why, the who / focus on how
• Man is always seen as good / Man is systematically considered bad
• Each is the author of his/hers progress / Each player is his/hers actions
• Everybody knows the strategy / the strategy is reserved for the Board of Directors
• Search performance by the happiness of everybody / Seek performance by the structure
• Outcomes of the results of happiness / Outcome of goals
• We want to win in the progress of each / We want to save money, and control costs
• Complex System / Complicated System
• Fair or equal / fair and equal
• AND / OR
• Simple rules strictly applied / implemented without complicated rules equity
• No notion of risk / search for zero risks
• Allow random opportunities / claim random control
• Micro breaks / fear of change
• Common sense / logic
• Outcome / Activity
• Plural / singular
• Having an essential (noble cause) / having rules
• Long-term thinking preferred / short-term thinking preferred
• Management by intention / management by controlling
• Cultivating links / contact
Page 25

26. • Emotional visions / objectives
• Recovery of fragilities / recovery of forces
• Make up / wanting to foresee all the consequences of ones actions
• Métaction / Anact
• Enterprise Y / Enterprise X
• Measures are not time-limited and non-perennial / measures are limited but perennial
• Imperfect measures / perfect actions that would never exist
• We take care of problems that exist / We are responsible for what might happen
• Dreamy / Factual
• The primacy of values and respect / Respect for laws and rules
• Simple messengers that are calmly though solid values / special knowledge
• Leveraging awards / leveraging penalties
• Soft and fuzzy / clean and hard
• Play on the emotional / play on the Cartesian
• Approach consistency uncontrolled / Approach inconsistency but controlled
• Operation in intimate networks / Operation in groups
• Search for friendly consensus / relationship based on giving
• The boss is recognized (or liked) / The boss is feared and respected
• Making money without knowing how / Loosing money by knowing why
• Lotto / Lottery
• Finding Outcome / monitoring activity
• Period of initiation for new / hiring process
• The quot;Bossquot; does nothing / the quot;Bossquot; has his/hers reserved playing field
• The Management committee wanders around / the Management committee is only informed by
reporting
• Power from the OUTSIDE / Power from the INSIDE
• The outside rules / power from the inside
• Power of the customer / power of the boss
• It is the customer who pays us / It is the employers who pay us
• The boss has the BALL / The boss is at the TOP
• Very high reactivity to the environment / compliance with budgeted targets
• All eyes look on the outside / all eyes look on the budget
• Awareness of all that the own interest is related to the collective interest / give and take
• Individual and systematic functions / specialized functions
Page 26

27. • Verbatim / numerical
• Concrete / Abstract
• Compliance with the deadlines at any cost / no respect for the delay in the name of cost
• Efficiency (number of aircraft shot down) / Effective (number of impacts
on the route of the aircraft)
• Seek to congratulate / seek to punish
• It works but the boss does not know how / the boss knows all the workings of his company but ...
Page 27

28. Enterprise Y vs. Enterprise X
Both notions “Enterprise Y” and “Enterprise X” are created by FAVI upon Theory Y and Theory X from
Douglas McGregor. Correspondingly the enterprise ' X ' is defined by FAVI as an organization in which man
is considered to be systematically bad, whereas contrary the enterprise quot;Yquot; is defined by FAVI as an
organization in which the same man is regarded as decidedly quot;goodquot;.
FAVI also refers to the Enterprise Y as the “round” enterprise, and the Enterprise X as the “square”
enterprise. The notions “round” refers to FAVI's Judeo-Christian roots and the rural culture of the Picardie, a
northern French region, while the “square” contrary refers to the Anglo-Saxon “command-and-control”
management model.
The following chart and graphic summarize the characteristics of both enterprise types:
ENTREPRISE quot;Xquot; ENTREPRISE quot;Yquot;
SYSTEM bounded by powers bounded by values
SYSTEM complicated and mechanistic complex and holomorphic
MAN either dominant or dominated authority to be dependent on the
power-dependent client
MAN is considered to be systematically “bad” is regarded as decidedly quot;goodquot;
HEAD secure, isolated from the process the interface between inside and
outside
HEAD in a box at the top of the bed observe button
HEAD pyramid isolated by his court has the ball
CENTER OF GRAVITY draw bar power of shared values shared values worn by all
CENTER OF GRAVITY The power of chiefs or laws power of the client and the
operator
LOGIC TYPE war powers search of happiness
TYPE OF SHARES preservation of acquired globals
TYPE OF RELATIONS group work work networks
RISK-TAKING ongoing risk no risk concept
Page 28

29. Enterprise X Enterprise Y
Client
CEO
Command
Plant Director Flow of parts
Command
Technical Director
Command
Merchant /
Service Director
Command Productivity
Flow of information
Sponsor
and emotion
Production Manager
Command
Workshop Manager
Command
Equipment Manager Leader
Command
Operator Mini-plant
Operators
• Primacy of HOW • Primacy of WHY, FOR WHOM
• POWER from the BOSS • POWER of the CLIENT
• POWER from the INSIDE • POWER from the OUTSIDE
• Men: 'bad' • Men: 'good'
Source: FAVI
FAVI mentions besides Douglas McGregor the following three origins of the Enterprise Y and Enterprise X
concepts:
• The socio dynamic matrix from Jean Christian Fauvet
• The complex system and the complicated system from the General System Theory
• The concept of the quot;power ringsquot;
Page 29

30. The socio dynamic matrix from Jean Christian Fauvet:
Jean Christian Fauvet classifies companies according to their positioning in relation to the inside and the
outside. The outside comprises at FAVI customers, suppliers, the laws, and the French labor department.
The tribal company The holomorphic company (which we can reconstruct
from a single of its parts, each part is in everything and
Def. : solitary Japanese type everything is also in each part)
The head: is at the center of its pack and is permanent
Who decides: The unanimity Def. : a Californian computer type
Center of gravity: the guru The head: has the ball
Type me: teamwork, shared values, dedication Who decides: the customer represented by the holders of
Type of logic: ideal logic sense the ball
Type of culture: budget driven, uncritically Center of gravity: customer
System Type: FEDERAL (paternalism, dependency due to Type me: empowered, independent, animated by business
base) spirit
Type of actions generated: classical = coherence by the Type of logic: complex logic = global
shared sense Type of culture: the common good, social and institutional
Wages: Increase. Honors goodwill, fidelity integrated values
The computer: Replaced by the bible System Type: complex high voltage (organic / cell network)
Strengths: internal dedication / external trust, shared
pleasure, loyalty Type of actions generated: meta dictions (life through the
Weaknesses: Lack of critical thinking, too dependent on a organization of systems)
guru Wages: Increase. Individualized rewards.
The computer: individual but networks
Strengths: autonomy, accountability, development,
leadership, team play
Weaknesses: Can be achieved only if the authority agrees
to fade!
The mechanical company The individualized company
Def. : statutory public company type Def. : mercenaries CNN type
The Chief: The top of the pyramid, such as The Chief: eveyone is a leader, no boss of bosses
interchangeable ministers Who decides: the majority
Who decides: The boss Center of gravity: Multiple each =
Center of gravity: The boss Type I: The self calculator, personal power obtained
Type me: protected status Type of logic: positive, experimental =
Type of logic: cause / effect = legal Type of culture: private reason
Crop type: Passive System Type: Heterogeneous turbulent (gaming alliance)
System Type: geometric low voltage (dependency Type of actions generated: = unique varied movement,
suffered) multiple, by freedoms.
Type of actions generated: naalc = order by law, inertia Wages: Increase. individualized and negotiated bonuses.
Wages: increase. uniformly generalized / standard negotiated merit
gratifications. Computer: PC Suite not interconnected
Computer: central, of which only the head to the key! Strengths: Responsiveness, expert, non-conformism,
Strengths: to order formal safety of its players, respect, adaptable
standards Weaknesses: unstable system, turn over important
Weaknesses: The system is complete in itself, as also the
customers
Source: FAVI
Page 30

31. The concept of “power rings”:
Enterprise Y
Enterprise X
the client
power ring
the boss
productives
$
Source: FAVI
Enterprise quot;Xquot;:
In the Enterprise quot;Xquot; the boss is surrounded by a first ring of power called quot;Executive Committeequot;, which
includes his secretary, his directors, and the HR department. The next power circle is represented by the
Middle Management, then the next power circle is represented by the Lower Management, and so on.
Enterprise quot;Yquot;:
Within the Enterprise “Y” all of the above mentioned power circles have been removed and replaced by a
flexible cell structure consisting of 21 cells. At the center there are the shared values which are the modern
translation of the ancient notion of the common good!
Page 31

32. “The love of the client”
During the transformation from the prevailing command-an-control management model, all FAVIans felt the
need to move away from the quot;Anglo-Saxon-industrialquot; classic command-and-control management model to
go to a more culturally quot;Jewish-Christian-rural” model. During a meeting while discussing the concept of
“love” Jeannine issued this simple idea: quot;The profit results from the love of the customerquot;.
Together, the FAVIans rediscovered the symbolic value of the tree, then after asking everyone to stop
breathing for a minute, Jeannine invented the concept that money is the breath of the company. Finally, the
FAVI associates collectively came to the conclusion that only the love of the client generates the essential
profit.
Then they came to the following conclusion:
TREE: (duration)
MONEY (the way of the duration)
$
LOVE (the way to make money)
CUSTOMERS (who exchange money
against products they like)
THE MINI-PLANT (which must with their
products to make love to their client P P P
Source: FAVI
Page 32

33. Lotto / Lottery
According to this principle lotto is a game where everybody wins a little bit, whereas contrary within the
lottery few people earn, but they earn very large. If any leader would propose anything based on the principle
of the lottery system, the leader would know in advance according to this principle, that his/hers proposal
would be rejected.
Origins of FAVI's management model and the management model sheets
“If we consider man as generous with his time and we will then control the clock, not the client.
That's why we've started since the 80s, to remove the clocks, awards, service personnel, stores, office
procedures, planning, launching, the purchasing department, in short all the structures that hold back man
and take their powers under the name of the freedom of thinking and acting of the operators.
Thus, little by little, together we have developed a quot;systemquot; our system.
This is not a system that can be considered at equilibrium and governed by immutable rules! We
incorporated a notion of uncertainty (which is not the absolute coincidence).”
The FAVI system's origins are diverse and summarized as follows:
• Mr. Zobrist's knowledge of the works of Fauvet and McGregor when he becomes CEO of FAVI in
1983
• Mr. Zobrist's own personality which reflects “Enterprise Y”
• Management literature from the 80s, mainly Tom Peters and Ohno
• the Judeo-Christian culture as also the rural culture of the Picardie, a region on northern France
• the possibility provided by FAVI's owner to run the company as Mr. Zobrist likes if law obligations are
met and a profit is generated
Page 33

34. Contrary FAVI's management model sheets have been developed after a conversation with an American
professor.
In June 2004 Mr. Zobrist hold a conversation with an American Professor of a renowned American University,
who was interested to learn about the FAVI System. Mr. Zobrist explained the FAVI system on the two
following examples. But as the American professor did not understand the FAVI system from these two
examples, so the management model sheets and FAVI stories were documented both on the web page as
also in two books. The management model sheets are for information purposes only to distinguish between
the “round” enterprise and the “square” enterprise. Mr. Zobrist also questions if the they are transferable to
other companies, but states that this is not the goal of them.
quot;You were the first European company certified ISO 14001 in 1996, first French company OHSAS 18001
certified in 2000 and again first French company, just before a nuclear power plant, to be certified QSE, but
your quality manager is a former worker!quot;
- quot;Well yes! And that is why we were able to move easily and with flying these certifications, as Jacques has
evolved, but always kept a good simple and effective way!quot;
- quot;For over 20 years you haven't increased your selling price, and yet you display honest but reasonable
results financial when you have no structure in manufacturing, no Chief Service Officer, Chief Technical
Officer, Chief Manufacturing Officer, Chief Workshop Officer... ..!quot;
- quot;Well yes but it is precisely because we have no structure in manufacturing operations and our operators
are free and are progressing advance in machines and naturally!quot;
- quot;You do not have staff and you have never experienced social conflicts!
- quot;Well yes, but because we did not have staff to manage these conflicts, there are none! In addition, here is
no personnel department to cope with complicated laws and rules which ensures the correct application, and
it is generally this complexity for the complexity that is a source of conflict!quot;
- You do not have any planning or scheduling, and yet you have never delivered late for 23 years!quot;
- quot;Well yes, because a planning department is designed to manage delays, and again because we do not
have a nonfunctional management structure, there is no malfunction!quot;
- quot;Good. How can it work?quot;
Then FAVI explained their FAVI model with lots of matrices, they were talking about McGregor, the socio-
dynamic matrix from Fauvet, Ohno ... but it was not sufficient.
quot;Well we have “round “ people in a world of “square” people! We are a “round “ enterprise surrounded by a
world of “square” enterprises. Our clients are “square”. Our suppliers are “square”. Our French laws are
“square”. To which the professor replied, quot;pleasequot; and Mr. Zobrist mentioned the following two examples:
Page 34

35. One day a quot;squarequot; car customer, is to audit FAVI's logistics. Two engineers, a man and a woman in the
forties, spend 3 days at FAVI and after the conclusion the boss of them said:
- quot;It is not at all: you have no indicator tracking delays, or indicators of breaches of flux, you have no
structure, no planning, no start, no scheduling, no delays, no management, etc.quot;
To which Mr. Zobrist replied:
- quot;From your records, how many years since we provide 100% your needs?quot;
- quot;11 years!.quot;
- quot;In 11 years, how often have we been delivering late or in advance?quot;
- quot;No!quot;.
- quot;In 11 years, how often has happened that you received not your complete order or too many parts?quot;
- quot;No!quot;.
- quot;Why do you want me to establish an indicator of something that does not exist?quot;
Answer: - quot;...quot;
Then Mr Zobrist told the second example: One day the material supplies didn't arrive and FAVI had used all
their security stock and couldn't deliver to their customer. One of the operators contacted the boss of the
supplier, which gave an interesting answer for this urgent situation: quot;I do not understand why you are down
because your service KPI is increasing!quot; Then Mr. Zobrist explains the situation: “Having followed an
indicator of level service and not delivered, is to be “square”. Do not even knowing what a service level is but
never delivering late, is to be “round”.”
Page 35

36. Resources
• Zobrist, Jean-François: quot;La belle histoire de Favi : l'entreprise qui croit que l'homme est bon Tome 1
Nos belles histoiresquot;, 2008
• Zobrist, Jean-François: “La belle histoire de Favi : l'entreprise qui croit que l'homme est bon Tome 2
Notre management et nos outils”, 2008
• Favi Homepage incl. all subpages, accessed 24th May 2009: www.favi.com
• Carney, M. Brian: quot;Workers of Europe Innovatequot; in The Wall Street Journal, 25th July 2005
• Front Cover Picture (Creative Commons 2.0 BY NC ND: by TigerLillyShop:
http://www.flickr.com/photos/tigerlillyshop/305791337/
License
This paper except all logos and the front cover picture is licensed under a Creative Commons BY-SA
License. Credit: quot;International Center for Outperformance (www.intco.org): FAVIquot; within the reference list
Page 36