Monday, March 12, 2012

Daily Lean Tips Edition #28

For my Facebook fans you already know about this great feature. But for those of you that are not connected to A Lean Journey on Facebook or Twitter I post daily a feature I call Lean Tips.  It is meant to be advice, things I learned from experience, and some knowledge tidbits about Lean to help you along your journey.  Another great reason to like A Lean Journey on Facebook.

Here is the next addition of tips from the Facebook page:

Lean Tip #406 - Clearly specify all Activities

Standardize work
  • Content (what is being done?)
  • Sequence (in what order?)
  • Timing (how long should it take?)
  • Outcome (what clearly defined measurable results are expected?)

Lean Tip #407 - Clearly define all Connections to every customer and supplier

No ambiguity
  • Direct (no intermediary between)
  • Yes or No answers (no maybe)

Lean Tip #408 - Clearly define all Pathways

Organize for uninterrupted flow
  • Simple (with as few steps and people as possible)
  • Direct steps to deliver the requested product or service

Lean Tip #409 - Continuously improve by applying the scientific method

Develop leaders who can apply the scientific method to improve anything
  • Direct response to any problem that arises
  • By those doing the work - as close to the problem as possible
  • Whenever possible, start as an experiment
  • Supported by a coach

Lean Tip #410 – Build in self-diagnostics into your systems.

Create a workplace that is:
     Self-ordering
     Self-improving
     Self-regulating
     Self-explaining

What is supposed to happen, does happen, on time, every time and when it doesn’t you immediately know and can intervene timely.

Lean Tip #411 – Devise strategies for mitigating risk.

Wherever there is investment, there is risk. So a key ability in management is to assess risk, and to devise strategies for mitigating or hedging against it. There are several stages to risk management:
  • Prevention aimed at lowering the odds of the risk occurring.
  • Control which reduces the damage if it does occur.
  • Transfer via insurance where you pay someone else to take on your risk.
  • Diversification keeps you from putting all your money on one card.
  • Hedging is used to lock up a contract for future prices.

Lean Tip #412 – There are two rules to follow to control risk based on the signal.

Overall risk mitigation follows two rules of forecasting:
Postponement increases quality of the demand signal
Reduction of leadtime increases the quality of the signal

Risk strategies are most effective when the uncertainty with total demand is much less than the uncertainty with any individual item.

Lean Tip #413 – Reduce the bullwhip effect with actual demand not forecasts.

A centralized information system, with actual demand provided to all players in the supply chain is an effective method of reducing the bullwhip effect. A system of target inventory levels is not quite as good.

Lean Tip #414 – Start with a reliable and capable process for a stable supply chain.

Any kind of uncertainty in supply needs to be covered with inventory. Unreliable processes cause unreliable delivery, and ultimately uncertainty at the receiving end. The starting point needs to be a reliable and capable process.

Lean Tip #415 – Avoid hand-offs and decision points to smooth the demand signal.

Every hand-off or tier in the system brings the danger of distorting the demand signal. The more people who interfere with the demand flow, the worse the swings generally become. Be aware of “double guessing” by creating a forecast on someone’s forecast.

Lean Tip #416 – Measure lead time to encourage Lean improvement.

Measuring lead time encourages inventory reduction, one-piece flow, reduction of flow length, and waste reduction. Lead time is best measured from end-to-end from receiving dock to finished goods.

Lean Tip #417 – Monitoring customer satisfaction is where the value is.

Following the first lean principle, monitoring customers is a basic requirement. If failure is indicated here, this has to be the first priority. Get this measure directly from customers, not internally from shipments.

Lean Tip #418 – Consistency comes from measuring schedule attainment.

An internal measure of consistency is schedule attainment. Schedule attainment is the ability to hit the target for quantity and quality on a day-to-day basis lin-by-line not weekly for the plant.

Lean Tip #419 – Track the distribution of your measures.

Build up the distribution – do not just measure the average. You really want to get the shape of the distribution narrower. This is an indication of tighter process control from reducing sources of variation.

Lean Tip #420 – When measuring inventory turns split into three measures.

Inventory turns is an established measure. It is useful to turn this measure into three measures – one for each of raw material, work in progress, and finished goods. Because WIP is fully under your own control where as raw materials and finished goods are not fully under your own control.


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