Quote of the Day 11/20/09

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.

“I say an hour lost at a bottleneck is an hour out of the entire system. I say an hour saved at a non-bottleneck is worthless. Bottlenecks govern both throughput and inventory.” - Eliyahu M. Goldratt, The Goal

A Lean Journey Now on Twitter and LinkedIn

There are now more ways to stay connected to A Lean Journey and keep informed of all the updates.

Join the newly created LinkedIn group A Lean Journey LinkedIn Group. All the posts from this blog will feed this group. This allows anyone in the group to post and/or discuss lean news items from any source promoting sharing within the lean community.

Follow A Lean Journey on Twitter @TimALeanJourney. The twitter feed will also be found on the right hand side of this blog so you can stay informed even if you don't use Twitter.

You can also sign up for RSS feed and/or Email updates at the links on the right hand side column under my profile.

As always you can connect directly to me on LinkedIn.com/in/timothyfmcmahon

The Key to Upcoming Retention Concerns is Recognition

A WSJ article yesterday talked about a growing concern for businesses to retain top talent. The author indicates that based on historical data workers will look elsewhere as the economy improves. This would pose a significant problem to those employers who may have weeded out weak performers while keeping top performers during this recession. A survey from last winter cites pay and benefits as the most important factors employees' value. Normally I would not concur with this but can understand with this recession why compensation is a top concern for workers.

While some companies struggle with how to financially reward their employees others are finding ways to involve their work force more in the business.

"We will not retain our staff if we can't get them to believe in us," Mr. Stack says. "If you value your employees, their trust will grow and they will not look around for another position."

According to the DOL, employee turnover cost American businesses about $5 trillion each year. Employee recognition is still one of the powerful strategies to combat turnover. A recent HR Daily Advisor Tip covered eight keys to successful retention. The advice includes exuding confidence in employee's ability, including significant others in praise, knowing what motivates and inspires employees, encouraging employees develop new skills, and simply saying thanks. Successful companies learn that you get what you reward.

In Lean retention and recognition come under the respect for people pillar of TPS. Respect for people comes from organizations building employee relationships that are fulfilling for their people as well as for the business.

How does your organization value employees and show appreciation?

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?