Rework Hampers Root Cause Analysis and Improvement

As a customer, you know how you feel when a supplier lets you down by giving you poor service or by failing to deliver the right quantity and quality product at the right time. When the shoe is on the other foot and you are the supplier we see it different.  These situations usually mean that your system has broken down and you need to initiate some form of corrective action, rework, to try to recover the situation.

Nearly every business has some level of ongoing rework. Most product-based businesses have some form of rework when they don’t satisfy the customer with their first effort. It may be that you can’t supply the complete order in one lot, or the quality of the product does not meet the customers’ needs. In service businesses, rework can occur when the customer is not happy with the service and some form of corrective work or follow up is required by the management team. 

Scrap and rework costs are a manufacturing reality impacting organizations across all industries and product lines. No matter why scrap and rework occurs, its impact on an organization is always the same—wasted time and money. Activities that reduce the quality or efficiency of a manufacturing operation or business process, but are not initially known to managers or others seeking to improve the process are referred to as “The Hidden Factory.” Most organizations have some form of a Hidden Factory.

Often, the corrective work occurs so frequently that the management team accepts rework as a normal part of business. This is a very dangerous interpretation of rework as it can hide many problems that should be made to stand out. A close examination of each and every cause for rework can provide improvement opportunities that can really lift business performance.

Instead of trying to fix the rework process (which is Muda), determine the root causes of needing rework/repair and fix those. If priority is given to evaluating and improving your manufacturing processes, it becomes much easier to reduce the amount of scrap and rework in your organization. Remember, Lean is about zero defects.

The first step to understand the size of your rework problem is to set up a monitoring system that will capture the data, including what happened and the reasons why. Building a system to record each individual rework event will establish baseline data that will enable you to assess future progress as your team works to eliminate rework.  This data is also valuable as you can use it to start to understand just how much money is being consumed by the rework process.  It is often surprising to realize the total cost of the hidden factory, but this can provide the strong motivation to attack the causes of rework.

To maintain a competitive edge, manufacturers must constantly find ways to cut costs and improve efficiency. One way companies can save time and money is by preventing scrap and rework. Correcting your systems by finding and eliminating the root causes of rework will result in a much smoother workflow where good days become normal.

Management by the Numbers Makes You Blind, Go Beyond the Numbers

Businesses love numbers and every good business manager loves metrics. After all, the old adage, “You can't manage what you don't measure” still holds true in most management circles.  However, a singular focus on metrics and worse, concentration on wrong metrics, keeps getting executives in trouble.

But here’s the key thing about numbers: they tell a story. They represent the culmination of the work you are doing. The story is a business need. And this is where managing the business and managing by numbers starts to get very important for those of us working in cubes.

People need to measure all types of work so as to be able to tell when things are working right and when things need to be corrected. We need to be able to measure our work for review and update as necessary. Meeting those numbers is critically important.

When managers use numbers to run the business, they are all involved in the story behind the numbers. They want to understand what the numbers are telling them about the state of the business. They want to know so they can change what is being done with the business to make it better.

But when a manager runs the business according to numbers, the world changes. No longer does the story matter. No longer does your input count as to what can make the business better. No longer, even, do logical and rational reasoning make a difference. No longer do innovative ideas on improving the business matter. No, what matters is the number. Not the story.

But there is measuring performance and then there is managing to a number to the exclusion of good business sense. There is a world of difference.

The effort to go “beyond the numbers” by using direct observation has the potential to help manage business efficiently and effectively. If we invest more in understanding people and less in understanding numbers, we’ll start to see the root causes behind performance problems.

Today’s lean management favor more holistic, less quantitative, and presumably more “dynamic” approaches. Know what to measure, and manage the numbers; don’t let the numbers do the managing for you, or of you. Organizations should be flexible, Lean, and focused on people and processes, not numbers.

Lean Quote: Small Improvements Are Believable And Therefore Achievable

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.

"Small improvements are believable and therefore achievable." — Anthony Robbins

In the spirit of doing better, the smallest ideas are likely to be the easiest to adopt and implement. These improvements are sometimes called Point or Mini Kaizen. Making one small change is both rewarding to the person making the change and if communicated to others can lead to a widespread adoption of the improvement and the possibility that someone will improve on what has already been improved. There's no telling what might occur if this were the everyday habit of all team members.

One of the most counter intuitive facts about small ideas is that they can actually provide a business with more sustainable competitive advantages than big ideas. The bigger the ideas, the more likely competitors will copy or counter them. If new ideas affect the company's products or services, they're directly visible and often widely advertised. And even if they involve behind-the-scenes improvements--say, to a major system or process--they're often copied just as quickly. That's because big, internal initiatives typically require outside sources, such as suppliers, contractors, and consultants, who sell their products and services to other companies, too. Small ideas, on the other hand, are much less likely to migrate to competitors--and even if they do, they're often too specific to be useful. Because most small ideas remain proprietary, large numbers of them can accumulate into a big, competitive advantage that is sustainable. That edge often means the difference between success and failure.

In a Lean enterprise a strategy of making small, incremental improvements every day, rather than trying to find a monumental improvement once or twice a year equates to a colossal competitive advantage over time and competitors cannot copy these compounded small improvements.


 

Deploying Lean in a Product Development Process

On The Lean Edge Blog this week a reader asked how to take Lean into product development:

A consumer-products company has recently begun its Lean journey by focusing on Lean fundamentals starting on the shop floor (standard work, 1-piece flow, pull, work to Takt). The company is simultaneously refreshing its product portfolio.  Although the cross-functional New Product Development (“NPD”) team members may have little experience working in a Lean environment, the team nevertheless desires to (1) deploy rapid NPD processes and (2) prioritize its product pipeline to take full advantage of its budding Lean capabilities.  For example, the team believes it should put higher weight on products most relevant to customers who will benefit from (and pay for) its improved service and quality levels.  If you were coaching this NPD team, what advice would you provide?  What Lean tools / resources / would you recommend?

I wanted to share some of my thoughts on the question, so here it goes:

Lean thinking is an enterprise strategy to grow your business profitably. For a business to grow profitably there are essentially two elements that are needed: Lean and Innovation. You need innovative products, technologies, and services that people really want. And this all needs to be done with operational excellence to compete in a global consumer driven market.

A Lean Product Development Process comprises 3 basic elements: (1) driving waste out of the product development process, (2) improving the way projects are executed with stage-gate A3 management process, and (3) visualizing the product development process.

The first step in eliminating waste from New Product Development (NPD), and thus improving the process, is to learn to identify the eight wastes.  By closely examining the entire NPD process from a Lean perspective, the opportunities to drive out waste and increase value will become obvious.

Improving the execution of individual activities with the use of Lean tools is the next step.  A stage-gate review process helps to define the process utilized in development while reducing the risk of development.  The A3 management process is used to solve problems, gain agreement, mentor, and lead projects.

The last step is to bring visual factory techniques to your product development process.  Visual boards displaying necessary information provides the status at a glance.  Stand-up meetings in combination with the visual boards allow for optimized communication and with a bias for action.

A couple of years ago I gave a presentation on Lean Product Development at a local conference where I expanded on the items I listed above.

Lean Product Development

View more presentations from Tim McMahon.

Lean is implemented in product development the same way it is in manufacturing or service processes. Predominantly the tools are the same. Sometimes we want it to be more complicated but the thinking is all the same. Start growing your business by deploying Lean thinking in your innovation process.

Guest Post: How I Quit Being a Door Mat

There’s a fine line between being a team player and ending up as the official doormat of your workplace.

Most of the time, when your coworkers ask for your help, it’s because they’re genuinely too busy with important work to get everything on their plate done on schedule. Maybe their responsibilities expanded because cutbacks caused someone else to lose their job. Or perhaps it’s just the busy season and they have more to do.

Whatever the situation is, it’s important to do your best to help the team. Not only will this raise the level of the entire department, it will help you as well. Do a good job on some important projects – whether they’re yours or not – and the people who matter will see how much you’re contributing and recognize your value.

The problem comes when you constantly find yourself suffering – both in work and life – because you’re always doing the dirty work and people start to expect that you will do it. Earn that kind of reputation and you could end up killing yourself with all the extra work just to keep a job that’s no longer satisfying. Worse, all that grunt work can sap away at your energy and make you less capable in your real work.

But there is a way to get out of this rut. Here are several lessons I learned that let me quit being a door mat.

Why you should not always say yes. Learning to say “no” is a very powerful tool, but it’s not just about saying "no.” You always want to be thought of as a person who’s willing to help the team, so you have to pick your battles wisely and have good reasons for when you do refuse extra work. And I don’t just mean good excuses that you can tell the person requesting your help.

Saying no is an opportunity. Instead of bogging yourself down in the grunt work that someone else doesn’t want to do, you’re keeping yourself free to tackle more important jobs, and preventing yourself from doing a bad job or burning out because you’re overworked. The goal shouldn’t just be to get the job done, but to impress the people above you and make it look easy – when you’re accepting work from all sides, the quality of what you’re doing can suffer, and that hurts everyone.

Why you don't have to please everyone. Some people just don’t like being the bad guy and turning others down, especially people they see as their friends. But by constantly taking on others’ work that you know they have time to do, you’re hurting yourself, enabling their lazy behavior, and making them see you as someone who can be taken advantage of. This doesn’t enhance friendships or build respect; it makes you their whipping boy.

At this point, it’s important to say that this kind of behavior isn’t the norm in most workplaces. Most people are just trying to work hard and climb that ladder – the same as you – but there are a few out there who are just opportunistic, and you have to know how to recognize them or risk being taken advantage of. Ultimately, refusing them is good for you, for them, and for the company because it causes everyone to strive for a particular level of productivity. Your goal should be to complete your work to the best of your ability; doing an excellent job makes the entire team look better.

Why being a leader of yourself helps you to lead others. Deciding to become a “leader of yourself” teaches you to prioritize tasks, evaluate the time you’ll need for each one, and agree or refuse to take on more work based on facts and what’s best for the business. Learning how to make yourself adhere to these principles is a fantastic way to show that you can transfer those skills into a position where you will be leading others.

In contrast, taking on everyone else’s work is a horrible way to conduct your professional life because it will leave you constantly struggling to define priorities and get everything finished. In effect, it keeps you from having to make those tough choices about what’s important and what isn’t because everything always feels like it has to be done now, now, now!

About the Author: 

Patrick Del Rosario is a Filipino business and career blogger. He is part of Open Colleges Blog. Aside from blogging and being a business blogger, Patrick is an aspiring photographer. If you want to feature his writings on your site, connect with him at Google+ or drop a line at patrick (at) oc.edu.au.

Lean Quote: Leaders Don't Invent Motivation In Their Followers, They Unlock It

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.

"Leaders don't invent motivation in their followers, they unlock it." — John W. Gardner

In my experience there are three things you need to learn about motivation:

1. First, you can’t motivate anybody to do anything they don’t want to do. Motivation is an internal thing, not an external thing.
2. The second thing is that all people are motivated. The person that stays in bed in the morning rather than getting up and going to work is more motivated to stay in bed than to work. They might be negatively motivated, but they are nonetheless motivated.
3. The third thing is that people do things for their reasons and not for yours. The trick is to find out what their reasons are.

Motivated, committed, engaged employees care about what they do and why they do it. They get up and come to work every day because they care about it. It’s not a short-term energy surge; it’s a way of life.

Motivation comes from within. Individuals have the capacity to motivate themselves...or demotivate themselves. Help them see the way by creating and sustaining the kinds of conditions that help them bring their best selves to work every day. Respect, proactive and honest communications, capable and engaged leadership – these are the ingredients that add up to an engaged, energized workplace.

 

Lean Math is a New Blog You Should Read

Our good friend Mark Hamel has a new project that I would like to share with you.

The Blog
We would like to announce a new entrant into the lean blogosphere, it’s called Lean Math (leanmath.com).

We know what you’re thinking, “Lean Math?!” Now, that’s a subject that evokes passion in the heart of every lean practitioner…right?

But, the truth is effective lean transformations require some level of math, whether it’s the often deceptively simple takt time calculation, sizing kanbans, calculating process capability, or anything in between. It’s hard to get away from math. There is no such thing as math-free lean and certainly not math-free six sigma!

Lean Math is not intended to be some purely academic study and it does not pretend to be part of the heart and soul of lean principles. Rather, it’s a tool and a construct for thinking. Here we want to integrate lean math theories and examples with experimentation and application. 

The Background

Within the next year, the Society of Manufacturing Engineers will be publishing a book, tentatively entitled, Lean Math. Mark Hamel, author of the Shingo Award-winning book, Kaizen Event Fieldbook and founder of the Gemba Tales^TM blog, and Michael O’Connor, Ph.D. (a.k.a. Dr. Mike) are co-authoring this work. They are also getting a ton (!) of help from Larry Loucka, friend, colleague, and fellow-blogger at Lean Sigma Supply Chain.

Here are some of the first blog posts:

• Time
• Cycle Time
• Square Root Law
• Min/Max Cut Theorem
• Coefficient of Variation

Personally, I am excited about this new addition to the lean blog frontier. I think there is a lot to be learned by Hamel, Loucka, and O'Connor. I hope you visit this new blog and find it useful and enjoyable.  I'd like to hear your feedback.