What is Lean?

A reader studying quality management and researching Lean recently asked me, what is Lean really about? In realizing that I have never fully defined my view of Lean on this blog I thought I should.

Let me preface this by saying it is difficult to succinctly define Lean in way that would capture the breadth and depth of knowledge. There are volumes and volumes of written text on many aspects and concepts of Lean. I have been studying in this field for a dozen years and my learning will never be done.

Lean is all about respecting people while eliminating Muri (overburdening), Mura (unevenness), and Muda (non value added activity) in all business processes. It is a philosophy which embodies a manufacturing culture of continuous improvement based on setting standards aimed at eliminating waste through participation of all employees.

The originators of Lean include thinkers like Henry Ford but its most notable and well studied collection of thinkers comes from Toyota. The Toyota Production System (TSP) is comprised of two pillars being JIT and Jidoka. The JIT concept aims to produce and deliver the right parts, in the right quantity, at the right time using the minimum necessary resources. JIT includes but is not limited to concepts of flow, takt time, pull via kanban, and leveling (heijunka). Jidoka is all about building in quality at the process and separating man from machine. The goal is not to run continuously but to stop running automatically at the first sign of an abnormal condition. Jidoka concepts include standardized work, mistake proofing (poka-yoke), process control, and problem solving (six sigma techniques).

The Five Fundamental Principles:

1) Specify Value – End-use customer view

2) Indentify Value Stream – Activities that create value

3) Flow – Make value flow

4) Pull – Respond to customer demand

5) Perfection – Zero waste

The Lean Rules-in-Use:

1) Activity Rule – Specify all work to content, sequence, timing, and outcome.

2) Connection Rule – Customer-supplier connections must be direct & unambiguous.

3) Pathway Rule – Pathways for product/service must be simple & direct.

4) Improvement Rule – Improvements are made using scientific method (PDCA) at place of activity (Gemba) under the guidance of a teacher (Sensei)

It is the endless pursuit of perfection which I refer to in the title of this blog “A Lean Journey: A Quest for True North”. True North is making 1 by 1, defect free, on demand, immediately, safely, and at no cost. It is the ideal target condition not easily achieved. It is approached by eliminating waste, the opposite of value. Value-added activities are those activities that transform materials or information, increase the form or function of products or services, and the customer wants. All other activities are wasteful; add no value; and consume resources, time, and space. The eight wastes are characterized as:

Defects

Over-production

Waiting

Non-utilized Resources/Talent

Transportation

Inventory

Motion

Excess Processing

This is only made possible by believing people are the cornerstone. You must engage all human resources and provide knowledge. These two elements are the key drivers to the speed of continuous improvement.

Lean is creating and implementing processes throughout the entire organization that are highly responsive and flexible to customer demand. Lean paves the way for delivery high quality products and services, at the right location, at the right time, all in a cost effective and profitable manner.

Here are some other resources for Lean definitions:

Mark Graban's Lean definition

Lean Enterprise Institute's lean definition page

Wikipedia's Lean definition

Art of Lean's learning page

This is a post that I will continue to reflect on (hansei) and update throughout my Lean Journey.

Quote of the Day 11/13/09

I am going to try a new thing here at A Lean Journey Blog. On Friday’s I will post a Lean related Quote. Throughout our lifetimes many people touch our lives and leave us with words of wisdom. These can both be a source of new learning and also a point to pause and reflect upon lessons we have learned. Within Lean active learning is an important aspect on this journey because without learning we can not improve.

Feel free to share some of your favorites here as well.

November 13, 2009

The world we have created is a product of our thinking; it cannot be changed without changing our thinking. ~Albert Einstein

Lean Is About More than the Myths

It is important when you are starting out your lean journey to understand what Lean is really about. Steve Cook, a former Dell Computer supply chain executive and newly appointed chief operating officer of MFG.com recently took time to explain three common myths about Lean.

Myth #1: Lean = Job Cuts

"If done well, Lean initiatives are less a cost-cutting exercise and more a growth exercise," said Cook.

Myth #2: Lean = Doing More with Less

Lean is about doing more to get more, knowing that reducing waste is a growth strategy, a way to help the company be more competitive, Cook said.

Myth #3: Lean = a Cost Reduction Strategy

While Lean initiatives clearly involve reducing costs, "it's a myth if it's the reason why you're doing Lean," emphasized Cook. "The underpinning of Lean must be about making the organization more successful."

Lean is really a systematic way to learn to see the inefficiencies in your processes and to solve these opportunities in such a way to grow the business profitably by adding value the customer will pay for. If you want to be a successful company you will learn to empower and engage the entire organization to focus improvement on value-added work from the customer’s perspective.

Cook added a saying from Dell which reflects this, “You’ll get beat up for high cost, but you’ll get fired for quality/availability issues.”

Is your organization solving problems only for themselves or are they solving those for their customers?

Leadership Strategies from Disney Part 2

To continue from the previous post on Great Leader Strategies from Disney we will discuss the last 6 strategies.

#7 Explore, Probe, And Know What Is Going On In Your Organization… And Act Upon The Information!

Leaders cannot make the right decisions or take the right actions without knowing the truth. You need many ways to stay informed. One of the best ways to know what is going on is to establish comfortable relationships so that people at every level feel comfortable discussing an issue or topic with you. Be available for people when they need you. Learn the truth by observing your operation from the customer and employee points of view regularly.

#8 Actively Observe And React To The Performance Of Your Direct Reports - Take Time For Recognition, Coaching, And Counseling!

Feedback is a powerful thing, and it is hard to improve without it because we have a hard time seeing our own faults as others see them. Train yourself to always notice performance, both positive and negative, and provide feedback. Coach and train your team on better ways to perform as a role model because people learn from what they observe more than what they are told. You deserve what you tolerate so never ignore or tolerate poor performance or bad behavior. Learn to think of “ARE”: Appreciation, Recognition, and Encouragement.

#9 Expand And Act Upon Knowledge And Experience Of The Best Service Available Anywhere!

Don’t be a dinosaur. Continuously learn and expand on your knowledge and experience in these four areas:

1) Technical competence

2) Management competence

3) Technology competence

4) Leadership competence

Keep up with the fast pace change in your business. Participate in professional networking, learn from your competitors, and aggressively solicit input on best practices.

#10 Partner Effectively And Successfully With Staff And Other Cross-functional Partners!

Partnership skills may be one of the reasons that some Leaders get such great results and are remembered fondly while other fail because they do not develop strong relationships with people. A good partner is available, keeps people informed, honors commitments, responds promptly, and stands up for what is right. Build trust by welcoming input and constructive feedback and asking for and offering help.

#11 Demonstrate A Passionate, Professional Commitment To Your Role!!!

Passion is the driving force that enables people to attain far more than they ever imagined. Commitment means you will go all the way for what you believe in. Passion and commitment go hand in hand. Demonstrate personal ownership by doing it right, and doing it right each and every time you do it. Make sure your job is something you love to do and be excited about coming to work. Remember to have a positive attitude because of the saying “Good attitude, good results; bad attitude, bad results.”

#12 Understand And Demonstrate Mastery Of Business Fundamentals!

Understand your business unit’s strategic plan and that of the company. Continuously improve your core business processes so they will create a competitive advantage. Be aware of global trends that may impact your business for the better and the worst. Don’t be a fence sitter. Be decisive and make tough choices. Know where and when to take risks and when to be cautious. Learn to operate the business as if it were your own.

The trail always leads back to leadership. Poor leadership or great leadership has a lot to do with everything that happens in the world in one way or another. Leadership is simply defined as making the right things happen. Are you employing these strategies to be a great leader or do you know someone you exemplifies these strategies?

Leadership Strategies from Disney Part 1

A new book on leadership called Creating Magic: 10 Common Sense Leadership Strategies from a Life at Disney claims “It's not the magic that makes it work; it's the way we work that makes it magic.” The author Lee Cockerell, a former Executive Vice President of Resort Operations for the Walt Disney Company, shared his insights from his incredible 16 years of front-line experience operating 18 resort hotels, four theme parks, three water parks, five golf courses, a shopping village and nighttime entertainment venue, and sports recreation complex. Lee's years, living the Disney principle, helped make The Walt Disney Company the front- runner in quality, service excellence and guest satisfaction. This book is based on his "Great Leader Strategies,” which Cockerell developed for Walt Disney World cast members.

The 12 strategies that Corkerell defines of a Great Leader are:

#1 Foster An Inclusive Environment!

Workplace inclusion is making sure that everyone matters and that everyone knows that he or she matters. It is about engaging and involving your team by asking their opinion and making it clear you want to hear their point of view. One of the main responsibilities of Leader is to develop future Leaders. Personally get involved and take time to do the so-called soft stuff really well otherwise your team won’t take care of the hard stuff. Disney defined its approach to inclusion with the acronym RAVE for Respect, Appreciate, and Value Everyone.

#2 Design Your Organization Structure For Success… “Break the Mold!”

Organization structure is critical to getting the best results. The most important thing is to make sure that every individual clearly and completely understands what he or she is responsible for, what level of authority he or she has, and how he or she will be held accountable.

#3 Make Sure You Have The Right People In The Right Roles!

Hiring new people and promoting people to new levels are really important to do well and carefully. Each time you have an opening you have the opportunity to add talent and strength your team. Make sure the candidate has the right level of expertise and experience for the job but also consider how the person will blend in with the current team.

#4 Ensure That Cast Members Are Knowledgeable About Their Roles!

Leaders are responsible to train and develop their team members. Education is power. Training and development are two of the best ways to improve self-confidence and self-esteem in everyone. Lead by example - attend all training, communicate best practices, and observe actual conditions and behaviors. The best way to develop people is for the leadership to be actively involved in coaching, counseling, and educating the employees.

#5 Make Dramatic Leaps In Guest Service!

Make dramatic improvements for customers, employees, and for business results. Great leaders don’t maintain anything. In order to improve things you need to know how good they are. Demonstrate zero tolerance for anything but perfection. Visit other places known for “world class excellence” and see what you can learn.

#6 Implement Effective, Structured Processes For Getting Work Done!

We have a process for everything. Leaders have the responsibility to identify process problems and opportunities for improvement so that they are not a hassle and that the make sense. Ask the people doing the work and customers using your products or services for their opinion. Spend time finding out what process made things go wrong and change that versus looking for someone to blame. Great Leaders ask “why” a lot. Implement processes that work and follow-up to ensure they are still working.

In the next post I will present the other 6 great strategies of a Great Leader.

Are All these Mobile Solutions Lean?

There was a recent Industry Week article worth mentioning titled Top Ten Mobile Solutions for Lean Manufacturing. Written by June Ruby a Director of Mobile Solutions at Motorola, it seems curiously like a sales pitch. However, the article does examine a number of areas where mobile technologies can improve productivity. In general these are areas where inventory transactions, data collection, and communication are vital to your processes. Access to real-time information can certainty reduce non-value added time, decrease errors, improve safety, and improve the efficiency and effectiveness of an organization.

Where I had point to pause and wonder whether this was Lean was the tenth area where mobility can impact Lean initiatives:

10. Management: Improve Decision Making and Manager Effectiveness
Regardless of whether your managers are responsible for your plant, sales or field operations, they need access to a wealth of information in order to act as effectively as possible. With a mobile device, managers can access productivity applications such as email, plant messages and alerts as well as back-end systems that provide a window into Key Performance Indicators (KPIs) and more. By mobilizing the many critical management applications, managers can be on the go -- yet access the information required to make the best decisions possible.

I understand access to information at your finger tips can be helpful but does this embrace Lean Thinking and teachings? You can not replace going to the Gemba (actual place). Management must practice Genchi Genbutsu which is a Lean practice of thoroughly understanding a condition by confirming information or data through personal observation at the source of the condition. You can not rely on a mobile device for this since it can’t provide information in this way. If you want to improve decision making you must go and see.

June also implies that management is too busy or unreachable to be available when needed. Lean teaches us to empower operations to make decisions in a structured way. We should all be able to recognize an abnormal condition and stop the process to understand the current condition, define the target condition, and implement countermeasures to close gap. We do not need to wait for management to tell us what to do. This is not to say we don’t need management because we do. It is just the role of management should be different in Lean environment from what is implied here.

Remember, technology can not replace management’s role in a Lean organization. They must learn to see, go to the source, use data and information, educate and coach, and empower the workforce. You can only do this by being accessible, available, and intimately involved. A mobile device can not do this for you.

Ford Posts a Profit

I usually leave the automotive updates to the automotive experts but I couldn’t resist mentioning this one. Ford, the only Detroit automaker to dodge direct government aid and bankruptcy court, surprised investors with net income of nearly $1 billion in the third quarter and forecast a "solidly profitable" 2011. The automaker cited higher pricing, lower material costs, and increased market share for the improvement. Ford cutback production which also allowed the company to cut incentive spending, since the company no longer has excess inventory it must discount heavily in order to sell.

Is this a win for capitalism and free enterprise? While heavy debt and lean times for American car shoppers threaten the comeback, the report puts Ford in a far better position than General Motors or Chrysler, which are still finding their bearings after emerging from bankruptcy.

Ford has focused on product quality, reputation, and making cars consumers want. Ford's cars are winning popular and critical acclaim, like the Fusion midsize sedan and more gas-efficient Focus compact.

The automakers problems are far from over with debt being the largest concern. The UAW also overwhelming rejected a new contract that would have put costs in line with cross-town rivals in the longer-term.

Here’s hoping Ford continues in the right direction.