Lean Tip #2911 – Don’t Rely on ‘Hunches’ on
Your Next Cost Savings Activity
You might think you know what the problem is
with your product. You might have a very clear idea about the cost burdens you
should address to change its fortunes in the marketplace. But do you have the
evidence to back it up? Be determined and systematic in your evidence
gathering. Don’t take anything for granted or you may miss your most dramatic
and unnecessary cost centers.
Lean Tip #2912 – Cost Savings Is Not a Job For Just
One Person or Department
The whole business needs to understand that
this is not a job for a single person or even a single team. It may be several
years since the way your product is delivered was last analyzed and explored
(if at all). There may be subtle ways in which your product is failing to
deliver against expectation, or cutting edge opportunities to introduce more
efficient materials and processes that require cross-discipline expertise to
uncover. Just giving one team the task to deliver on VE objectives is a
mistake.
Value Engineering is a powerful tool because
it’s an objective, cross-disciplinary tool. It uses the insight around every
part of the product cycle from material procurement, product build, and
logistics - to make suggestions for intelligent cost reductions and
substitutions that will improve value for your customers’ long term. You need
to conduct proper VA/VE with an expert internal team to facilitate this.
Lean Tip #2913 – It is Important to Generate
Lots of Ideas
The more ideas generated— the better. When it
comes to VA/VE, I would much rather have the burden of ranking a ton of ideas
as opposed to having too few. Think about it. The process of sharing ideas,
good or otherwise, inspires even more ideas. Sowing lots of idea seeds gives
you greater potential to harvest great solutions. Increase your odds of success
with as many ideas as possible!
Encouraging an abundance of ideas requires
coaching in divergent thinking and establishing an open, comfortable
environment. Paradigms must be deconstructed, and pet designs neutralized. A
climate that encourages productive-free expression and probing questions and
eliminates judgement or disapproval should be cultivated. For this part of
VA/VE, assemble a group representing nearly every functional area in the
business and prepare them with the objective and rules of engagement well
before any meeting takes place. If possible, consider priming them with
materials to educate them in idea generation and be sure to provide for their
comfortable and undistracted participation in the idea-generation meeting.
Lean Tip #2914 – VAVE Is Not About Slash And Burn
Some businesses say they’re implementing Value
Engineering but are simply on a slash and burn cost-cutting exercise. In
searching for savings they pounce on every opportunity to cut spending, beat up
suppliers on cost and substitute materials for cheaper alternatives regardless
of the impact on quality. That strategy won’t work long term because it’s not
interested in preserving the value of the product for the customer. It is more
likely to damage ongoing sales and, ultimately, your reputation as a supplier.
Lean Tip #2915 – Liberate Your Thinking
Through Creativity
The purpose of VE is to be imaginative. But the
reality is it’s quite difficult to be creative on demand. Don’t forget, that
when the technology is complex it can be difficult for non-specialists to
understand and contribute to the conversation around potential alternative
solutions.
The techniques that Value Engineering uses for
creativity - such as Functional Analysis - helps a mixed team look past the
technical complexity to quickly grasp the primary function of a product. In
other words, what a particular component actually does for a customer. You
don’t need to understand exactly how the element achieves this to grasp its
function and the value it brings the customer. But equipped with that basic
knowledge, a whole team of different disciplines can begin to suggest new ways
the function might be fulfilled at a lower cost, in ways possibly never
imagined before.
Lean Tip #2916 – Gather Ideas from the
People Doing the Work
In a Lean and continuous improvement
organization employees are your greatest asset and should also be the source of
generating new ideas for improvement. No one knows the work better than the
person who performs it everyday. No one has more “skin in the game” about the
working process than that person. As a result, the best person to suggest ideas
for improvement and to implement them is the line worker.
Lean Tip #2917 – Prioritize Ideas That
Are Inexpensive
By going after the ideas that do not
require a large amount of investment, you can remove the financial barriers of
your continuous improvement efforts. This process can empower the line worker
to suggest and implement ideas that can improve their working process because
they know that their changes do not need upper management approval. Some ideas
such as reducing waste, eliminating unnecessary steps, and re-organizing in the
work processes fall into this category.
Lean Tip #2918 - Focus on Gradual Small
Changes Instead of Major Shifts
Focus on small gradual changes rather
than large changes. Small changes can be made quickly, on a daily-basis, and
are typically inexpensive. By focusing on small changes, you can remove
barriers from just starting a continuous improvement process. This focus will
allow your team to reap the benefits of their “small wins” right away. As more
and more small changes are applied, your team will see an accumulation of
benefits from them. This will give them more confidence to suggest more ideas.
Lean Tip #2919 – Apply PDCA for Regular
Feedback
An effective continuous improvement
program needs continuous measurement and feedback. Before you can start, you
need to understand the baselines of your organization’s performance. Only by
understanding and establishing a baseline can you evaluate new ideas for
improving upon it. One effective way of gathering feedback on your continuous
improvement efforts is to apply the Plan-Do-Check-Check (PDCA) cycle. The PDCA
cycle allows you to scientifically test your experiments. The cycle ensures
continuous improvement by measuring the performance difference between the
baseline and target condition. This gives immediate feedback on the
effectiveness of the change. If the idea was effective, the next cycle of
improvement will start with the new baseline and your goal is to move towards a
new target condition.
Lean Tip #2920 – Foster An Environment
of Trust, Collaboration, Open Communication, and A Willingness to Experiment
Applying continuous improvement requires
participation from everyone in the organization. Upper management needs to
invest time and money in employee training and empowerment. Managers need to
foster an environment of trust, collaboration, open communication, and a
willingness to experiment. And finally, workers need to be engaged in their
work and be challenged to come up with small gradual improvements each and
every day. By applying these principles, your company will be able to start and
sustain your continuous improvement efforts. This will lead to a more
economically competitive organization, more efficient work processes, and more
satisfied employees.
Lean
Tip #2921 - Ensure a Penalty-Free Exchange of Ideas.
In
many organizations, expressing one's opinion on how to do things better may not
necessarily be a welcomed activity. Management can feel threatened or pressured
to act resulting in immediate resistances. And, those expressing ideas may be
viewed as complainers or trouble makers. In such an environment, it doesn't
take long for the potential risks of making a suggestion to stifle enthusiasm
and participation in improvement oriented thinking. Ensuring a penalty-free
exchange of ideas is beneficial to both the giver and the receiver of new ideas
and approaches and will ensure a safe two way exchange of thoughts and ideas.
Lean
Tip #2922 - Encourage Frontline Teams to Identify Improvement Opportunities
From
sales to customer service, there are many frontline employees in your workforce
who deal with customers on a regular basis. The conversations they have with
your target audience can help them identify potential pain points or
opportunities for improvement.
Encourage
these teams to share this information with you so they feel like their
involvement in continuous improvement is making a difference.
Lean
Tip #2923 - Integrate Shared Accountability.
As
a team, identify the focus of the work and the opportunities for improvement.
Share the responsibilities and the work among team members. It might be
surprising that the more responsibility a team member is given, the more
motivated they may become.
Lean
Tip #2924 - Enforce Improvements
It’s
easy for employees to regress to their old ways. Enforcing the changes you’ve
made to your processes is important for the improvements you’ve made to last,
and it’s key to sustaining continuous improvement in the long term.
Documenting
improvements, making sure standard work is up-to-date, and training employees
on new procedures can help sustain the progress you’ve made in your continuous
improvement efforts.
Lean
Tip #2925 - Standardize Work for Sustainment
In
order for improvements to last, they must be standardized and repeatable.
Standardizing work is crucial to kaizen because it creates a baseline for
improvement. When you make improvements to a process, it’s essential to
document the new standard work in order to sustain the improvements and create
a new baseline. Standard work also reduces variability in processes and
promotes discipline, which is essential for continuous improvement efforts to
take root.
