Times is Money, Use it to Your Advantage

One of the central elements in Lean is the reduction in lead time.  Bruce Hamilton, president of the Greater Boston Manufacturing Partnership, calls this the time between paying and getting paid.

George Stalk and Thomas Hout, both of The Boston Consulting Group, wrote, Competing Against Time: How Time-Based Competition Is Reshaping the Global Economy in 1990.  This book was one of the first to identify the importance of time as a competitive advantage.

Based on their research, they outline four rules of responsiveness that the value-delivery systems of corporations are subject to:

The .05 to 5 Rule
Most products and many services are actually receiving value for only 0.05 to 5 percent of the time they are in the value-delivery systems of their companies.

The 3/3 Rule
The waiting time has 3 components, which are the time lost while waiting for:
- Completion of the batch a particular product or service is part of
- Completion of the batch ahead of the batch a particular product or service is part of
- Management to get around to making and executing the decision to send the batch on to the next step of the value added process

The ¼-2-20 Rule
For every quartering of the time interval required to provide a service or product, the productivity of labor and of working capital can often double, resulting is as much as a 20% reduction in costs.

The 3 x 2 Rule
Companies that cut the time consumption of their value-delivery systems experience growth rates of 3 times the industry average and 2 times the profit margins.

Companies and their management must understand these how these rules of response apply to their business and use this to their advantage.  Reducing the cycle time of the value-delivery process can result in the following benefits:
            1)     First to market for new products           

      2)     Increased market share becoming closer to customer
3)     Price premiums for reduced delivery times
4)     Increased productivity from increased capacity and lower cost

The golden rule of time based competitiveness is to never delay a customer value adding step by a non-value adding step.  Process mapping the value-delivery process is recommended to eliminate and reduce non-value added steps.

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Lean Quote of the Day, March 12, 2010

On Fridays 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.

"Pretend that every single person you meet has a sign around his or her neck that says, 'Make me feel important.' Not only will you succeed in sales, you will succeed in life."


-- Mary Kay Ash 1918-2001, Founder of Mary Kay Cosmetics

A company is really defined by its people. It doesn't take long to pick up on the culuture within a business. The job of management in a lean environment is to help people realize their potential within the business.  Whether in sales or any other function of the business engaging and empowers all employees is critical to success.  Look at how to empower your innovators in the post titled the rudolph factor and the eighth waste.  Rudolphs are those bright, empowered, innovative people of your business.  Since they aren't wearing signs one key is learning how to recognize them and their vaue.

Organizing for Dummies

I recently came across an interesting book called Organizing for Dummies by Eileen Roth and Elizabeth Miles.  This is not a manufacturing or office book but rather a book about tidying up and clearing clutter in your house.  Nevertheless, there is some practical advice for anyone.  The authors offer several simple acronyms to help you get organized and stay organized.

When you are deciding what to keep and what to pitch use the WASTE way of questioning:

W — Worthwhile? Do you truly like the item? Think of cost of storage vs. cost of replacement.
A — Again? Will you use it, really? Think probability?
S — Somewhere else? Can it be borrowed or found somewhere else if you need it?
T — Toss? Will the world end if you get rid of it? Think consequences.
E — Entire? Do you need the whole thing or just part of it?

When deciding where things should go put everything in its PLACE:

P — Purge: Get rid of it, look at the WASTE questions above.
L — Like with like: Create a center for things, can variety be reduced?.
A — Access: Create a spot that is easy to get to your things.
C — Contain: Use containers to create space and keep things together.
E — Evaluate: Does this organizational layout work? 

Many of us should learn REMOVE in our office to create successful work area:

R — Reduce distractions from your desktop.

E — Everyday use items stay on top of your desk.

M — Move items to the preferred side, like the right side if you're right-handed.

O — Organize together, keep similar items grouped together.

V — View your time, keep a clock on your desk.

E — Empty the center so you have a clean workspace.

These simple acronyms follow the standard 5S thinking in Lean manufacturing that we are familiar with.   How do you use 5S in your work at the office or at home?  Can you REMOVE WASTE at your PLACE?

What does it take to be a Lean Manager?

During a recent plant visit I questioned the management style of the operations team.  You could say it was a traditional style of management of sort.  Unfortunately, they thought they could manage from the office.  This passive style left a lack of visibility on the shop floor and no sense of the condition at the Gemba.

It occurred to me that while transitioning from a traditional push factory to a leaner factory that some of the management was not changing.  Did they know how to change or even what management in a lean environment means?

 

Lean leadership is a fundamental element to creating and sustaining Lean Thinking in any organization.  To manage in a lean environment you must change your state of mind equal to that of the organization’s cultural transformation.  To change our mindset Mike Rother says we must focus on these 3 factors:

        1) Method - Specify the desired behavior pattern

        2) Practice - People repeatedly apply the method

        3) Coaching - Guide people in learning the method

       

“With practice, training, and above all method, we manage to increase our attention, our memory, our judgment and literally to become more intelligent thane we were before.” – Alfred Binet.

The Toyota Production System’s core management principles are articulated around the twin pillars of Continuous Improvement (relentless elimination of waste) and Respect for People (engagement in long term relationships based on continuous improvement and mutual trust).

In my experience I have learned that the single most important element for success in Lean is the human element.   First and foremost Lean managers have the critical role of motivating and engaging all people to work together toward a common goal. Management must define and explain what that goal is, share a path to achieve it, motivate people to take the journey with them, and assist them by removing obstacles.

I believe in the saying “people are the most important asset”, and, for that reason, management must have a shop-floor focus. Lean managers are taught that all value-added activities start on the shop floor; therefore the job of managers is to support the team members. Production team members will only appreciate management on the shop floor when they can see that they are out there to help them do their jobs, not as part of a command structure, bent on telling them what to do.

“Respect for People” is about building mutual trust and human development.  Lean managers must take responsibility for other people reaching the objectives they set.  They seek to develop and engage individuals through their contribution to team performance.

The Lean manager must be a problem solver, an essential skill in continuous improvement.  It is not necessarily about making decisions but more about encouraging and empowering your workforce to solve problems.  Lean managers embrace experimentation through scientific method of PDCA (Plan-Do-Check-Act).

Lean managers understand that not all countermeasures will be successful. This is part of Kaizen and they make failure acceptable in a way that encourages employees to continue resolving the problem with a new countermeasure.

Lean managers must be customer focused. They need to ensure that all team members and all departments realize their dual role: they are at once the customers of the previous operation and the suppliers to the next operation downstream.

The challenge of Lean managers is to lead as if they have no power.  In other words, shape the organization not through the power of will or dictate, but rather through example, through coaching and through understanding and helping others to achieve their goals.

Lean Leaders essentially have three basic responsibilities:

      1) Support operations

      2) Promote the system

      3) Lead change

The only place I know to do these is at the source or the Gemba where the actual work takes place.

Lean management is an art one should perfect with time and with the understanding about lean manufacturing. Lean leaders will be the most important asset to any organization in its lean journey.

Lean Quote of the Day, March 5, 2010

On Fridays 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.

The greatest challenge to any thinker is stating the problem in a way that will allow a solution. - Bertrand Russell

A problem well stated is a problem half solved. - Charles F. Kettering

A well-stated problem statement speeds a robust corrective action process. It helps identify potential root causes and eliminate bias and noise.  Accurate problem statements save time and effort by focusing the team on root cause identification.  Continuous improvement happens when root causes are found and permanently eliminated.  Learn more about the first step in this process by review this post on defining the problem statement.

Three Simple Questions All Managers Should Ask Everywhere

A Lean implementation can not be sustained without Lean management. Our management system must change as our production system changes in Lean to maintain the integrity of technical changes over time. A Lean management system comprises of the practices and tools used to monitor, measure, and sustain the operation of Lean production operations. Lean management practices identify where actual performance fails to meet expected performance; assigns and follows up improvement activities to bring actual in line with the expected, or to raise the level of performance. The four principal elements of Lean management are standard work for leaders, visual controls, a daily accountability process, and leadership discipline.

Management must go to the Gemba to practice Lean management. Gemba is roughly translated from the Japanese as the real place. The idea of the Gemba is simple: go to the place, look at the process, and talk with the people. Gemba walking teaches us to see in new ways what we have failed to see before. So what do you look for and how do you see it? All management should learn to ask these three simple questions:

       1) What is the process?

       2) How can you tell it is working?

       3) What are you doing to improve it (if it is working)?

Nothing sustains itself, certainly not Lean manufacturing or Lean management. So, establish and stick to a routine including regular visits to the Gemba, check the status of visual controls, follow-up on daily accountability assignments, and ask the three simple questions everywhere. Lean management is, as much as anything, a way of thinking.

Lean Quote of the Day, February 26, 2010

On Fridays 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.

All blame is a waste of time. No matter how much fault you find with another, and regardless of how much you blame him, it will not change you. The only thing blame does is to keep the focus off you when you are looking for external reasons to explain your unhappiness or frustration. You may succeed in making another feel guilty about something by blaming him, but you won't succeed in changing whatever it is about you that is making you unhappy."
-- Wayne Dyer

 One of the biggest areas of concern is the Behavioral waste and blaming which some leadership utilize on a daily basis.  Blame is a what I call a "fat" behavior.  Bob Emiliani who has studied lean transformations and lean behaviors was the first to use the term “fat” behavior.  Check out this post called No "Fat" Behavior, Please to learn about the difference between lean behaviors and "fat" behaviors.