Lean Tips Edition #202 (#3241 - #3255)

For my Facebook fans you already know about this great feature. But for those of you that are not connected to A Lean Journey on Facebook or Twitter I post daily a feature I call Lean Tips.  It is meant to be advice, things I learned from experience, and some knowledge tidbits about Lean to help you along your journey.  Another great reason to like A Lean Journey on Facebook.

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Here is the next addition of tips from the Facebook page:

Lean Tip #3241 – Make Sure Your Goals are Measurable Before You Develop Performance Measures.

Have you noticed that most KPI conversation start with someone asking a question like this: “So, what could we measure?” Wrong question. It leads us down a rabbit-hole as we rush to quick-fix KPIs. We end up creating the wrong KPIs for the goals we have. Or we end up with very trivial measures that don’t help us make better decisions.

Meaningful performance measures start with measurable goals. This means that your goal needs to be worded clearly enough and specifically enough that you can imagine how you’ll recognize when it becomes real. So you might first want to check if your current goals are measurable.

Lean Tip #3242 – Build Buy-in Among the People Who You Need to Support the KPIs.

You know what happens to KPIs that are developed by very small teams or consultants, in private meetings and with no documentation of the rationale for choosing them? They get ignored. No-one will buy in to something they don’t understand, weren’t involved with, and see no relevance in. And don’t think that asking people for their sign-off will work either. KPIs work with buy-in, not sign-off.

You only have meaningful KPIs and measures when they are brought to life and used to improve performance. But they won’t be brought to life if the people who collect the data, analysis the data, report the measures and use the measures don’t buy in. Here are three powerful tactics to make sure you build the buy-in from the start:

·        Use a Measures Team that includes the people who know the process or function, the data, the customers and the current problems of the area you want to measure.

·        Document your thinking as you design the KPIs, so others can understand and critique it.

·        Create an open space for people to see, explore, discuss and give feedback on the draft KPI work.

Lean Tip #3243 – Define the Questions you Need Answers To

Linking your KPIs to your strategy will immediately sharpen your focus and make the relevant KPIs more obvious. Identifying the questions you need answers to will further narrow your focus, because questions give the indicators context.

That’s why, as well as KPIs, I always advise companies to think about KPQs: Key Performance Questions. These will help you work out what data you need to gather, and, therefore, which KPIs you’ll find most useful. For example, if you plan on executing a simple strategy to increase your income by focusing on the most profitable areas of your business, you could ask “Where are we making profit and which processes are most costly compared to the returns we receive?”

Once you are clear on the questions you need to answer, you can make sure that every indicator you subsequently choose or design is relevant not only to your strategy, but also provides the answers to very specific questions that will guide your strategy and inform your decision making.

Lean Tip #3244 – Determine the Right Measurement Methodology and Frequency

Knowing what you need is one thing, working out how to access and measure that information is another. Finding the right measurement methodology is critical. Therefore, once you know what information you need to collect, you need to find the right measurement methodology to get it. This is especially true if you have to develop new KPIs or tweak existing ones.

It’s always preferable to align measurement frequency with how and when the data is used in the organization, because all data has a “shelf life”. This means measurement frequency must be in line with the reporting frequency. If it’s not, the data may lose impact and/or relevance. For example, if you collect customer satisfaction data via survey in the summer and report on the findings in the winter, then the findings are already six months out of date.

Lean Tip #3245 – Assign Ownership for Your KPIs

Effective KPIs require two types of ownership. The first is the ownership of the KPI in terms of its meaning and interpretation. Someone needs to be in charge of looking at the KPI, interpreting its meaning, monitoring how it’s changing and deciding what that means for the business.

The other ownership refers to the data collection. Sometimes you can automate the process but, more often than not, data collection will require some human interaction. Perhaps certain personnel are involved in transferring data from one database to another, or they have to collect it manually. Again, this ownership needs to be clearly set out and followed through.

Lean Tip #3246 – Ensure KPIs are Understood by People Within Your Organization

It’s essential that everyone in your business is aware of what you’re trying to achieve, and how you’re measuring progress towards those achievements. This is especially important for those who are charged with ownership of the KPIs, but it’s also important for people right across the business, at any level. KPIs should form part of the decision-making process for every employee, and everyone should be able to answer the question, “How will what I am doing today affect our KPIs?”

You therefore need to ensure everybody understands how the metrics you are gathering are linked to your strategic priorities. This will increase “buy in” – how personally involved and enthusiastic your staff feel about your priorities – and ensure that constant review and improvement are at the heart of everything your people do. If you simply tell everyone that they have to collect a whole heap of extra data from now on without explaining why, you are likely to end up with a very cynical and disengaged workforce!

Lean Tip #3247 – Find the Best Way to Communicate Your KPIs

It’s always wise to think about how best to communicate your KPIs so their insights are obvious, engaging and apparent to all. So many KPIs are reported in long reports full of numbers or tables, perhaps with a traffic light graphic to indicate urgency. This is not good enough. There is absolutely no point hiding important insights in excessively long reports that no one ever reads.

Really effective visualizations clearly illustrate trends and variations in data, and engage the reader. Try to find the right picture for your KPIs and create an explanation of the insights so that the nuggets of wisdom extracted from the data are clear, unambiguous, accessible and, most importantly, actionable.

Lean Tip #3248 – Describe the Intended Results

Once you’ve identified your primary goals, you’ll need to figure out what success looks like. For example, let’s say you want to increase profit by X%. In this case, it’s a good idea to look at the end goal and work backward.

Ask yourself: what steps are necessary to achieve this goal? Who will perform these tasks? Do you have enough staffing and resources to support these tasks? The answers to these questions will help you identify the concrete steps to achieve your goals—this, in turn, informs which key performance indicators you’ll focus on.

Lean Tip #3249 – Do Not Set the Goal Too High. It is More Motivating to Over-Perform Than Struggle.

In my experience, managers will often make the mistake of believing that ambitious goals will, in them self, motivate and encourage the team to work hard. But the goal for the KPI's should be realistic, since it is much more motivating working towards goal that you actually can achieve, rather than struggle trying to reach an unrealistic goal.

What then defines a realistic goal? It's difficult to generalize but looking at historical data and comparing it to other factors like budget/time/resources etc. will hopefully enable you to determine if the goal is realistic or not.

Lean Tip #3250 – Not Everything That Counts Can Be Counted, And Not Everything That Can Be Counted Counts.

William Bruce Cameron (or was it Albert Einstein?) said this famous quote many years ago, but it is still relevant today. Not everything can be easily tracked, but it doesn't mean that it is less important. A concept like Brand Perception is difficult to measure in quantitative tests, but it might still be very relevant for your business. You might not be able to set up a dashboard which is automatically updated with the Brand Perception every hour, but it might still be worth investigating through surveys/interviews?

Also remember that KPI's are not a business goal in themselves - they simply represent them. So if you know that an activity works and has a positive impact on the organization, but you have a hard time measuring the effect, you should of course still do it - but simply recognize that not everything that matters for your business can be measured or defined as a KPI.

Lean Tip #3251 – Foster a Creative Environment.

Allow team members to brainstorm in an open, non-judgmental framework that embraces the team’s purpose and direction. Employees need to feel secure enough to take risks, both individually and as a team, and to be willing to suggest daring ideas. After all, creativity is just as important as innovation, and both are essential to the longevity of a business.

Lean Tip #3252 – Build Team Cohesion.

Create a means of communication that allows for easy workflow, establishes a distinct set of priorities, and makes all colleagues feel included. Solicit feedback from staff members and listen to employee input to make them feel heard. Ensure everyone is operating from the same playbook so team members can focus and flourish.

Highlight the different ways employees contribute to the business and build teams around common impacts. Forming smaller teams can help group and guide employees at a more manageable size, fostering productivity and accountability. This also gives employees the chance to develop stronger professional relationships, as workers will want to know they can depend on each other to achieve their goals.

Lean Tip #3253 – Learn Visualize Ideas.

Give team members the opportunity to use visuals to share and clarify their ideas at the simplest level. You can do this with anything from rough sketches to full-scale presentations. Most people learn better and retain more information when it’s presented visually, and a collaborative whiteboard, whether physical or virtual, is a great tool.

One benefit of transforming ideas from spoken concepts to visual aids is it can help people digest information easier. It’s one thing to rattle off numbers or statistics, but a visual representation can further everyone’s understanding and comprehension.

Lean Tip #3254 – Empower Your Employees

Delegating power to your employees can help improve teamwork, increase its effectiveness, as well as improve morale and productivity. As an employer, empower your workers with the ability to make decisions which will essentially boost their confidence, give them autonomy, and reinforce their roles and responsibilities within the organization and their respective teams.

Empowered employees are more likely to work collectively as a whole-team when given the opportunity to communicate their versions of a goal, as this allows them to feel heard and work towards a shared objective as a team. Effective delegation of decision-making is important to facilitate teamwork- rather than fixating on a person’s working ability, one should help them share work responsible for team tasks.

Lean Tip #3255 – Clearly Define Roles and Rewards for Each Team Member

Rewarding team members for meeting early goals and/or making significant progress helps your team members stay motivated and on track for the project's completion. Employee recognition can also help your fellow team members remember the importance of their role in the project and increase morale.

Both team leaders and individual contributors can give positive feedback by noting exceptional work or praising a valuable idea. Recognizing your coworkers as you work toward a common goal can help motivate the entire team.

Lean Quote: Don’t Water Your Weeds

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.

"Don’t water your weeds."   —  Harvey Mackay

The need for a business to address issues at the core and avoid skirting around them – for whatever reason this may be – is paramount.  Issues left to fester will become major problems before long and as highlighted, avoidable issues can be quashed before they have an effect, if tackled at source.

Along with tackling problems comes the need for change. Change is inevitable, and firstly acknowledging that it is required, and then acting upon this requirement can often be ignored.  The current situation or way of doing things can be ‘the norm’ – whether they represent good working practices or not – and so things can be left as-is to avoid change.

Change should be embraced and acted upon without prejudice. To enable this to be the case, the use of change control should be considered.  Control measures such as non-conformance reporting are often taken as an attack on an individual’s ability or way of working.  In order to embrace change, we all need to accept that nothing is ever perfect and that change, and indeed continuous improvement, can only be achieved through accepting that this is the reality.  This type of change control should be implemented with a view to identifying issues around working practice, procedures and processes, and not necessarily the individual involved in the activities.

Continuous Improvement should be exactly that – continuous.  This can only be achieved through identifying issues and problems, seeking solutions to these, and implementing them through accepting and acknowledging that they are necessary.

Identify the issue.  Seek the solution.  Implement the change.

Don’t just ‘water the weeds’, deal with the problem.

6 Strategies to Reduce Production Costs

For any business, waste strains profitability. Waste can come in the form of time, resources and labor; it shows up through poor process planning, inventory imbalance, or poor warehouse layout. Essentially, waste is any expense or effort that does not transform raw material into a finished product. By optimizing processes and eliminating waste, businesses can add value to each phase of production.

One way to improve profitability is to reduce production costs. Production costs are the costs incurred in manufacturing a product or providing a service. These can include expenses such as raw materials, labor, suppliers and general overhead.

Consider these six ways to reduce production costs:

1. Track your costs

To begin with you need to ensure you’re tracking your costs — you can’t change what you don’t measure. The first step is to identify all operating costs and understand which costs have increased. Decide the intervals for tracking key information to help you make informed decisions about manufacturing cost reduction.

2. Eliminate bottlenecks and redundancies

Analyze each stage of your production process: is each activity required? Does it add value? You should also consult the relevant employees to find out what steps in the process are not adding value, redundant, or interrupt their workflow. Drop non-value-adding activities to cut out unnecessary costs.

3. Tighten your inventory control

Optimal inventory control means you hold the right quantity of stock so you’re not stuck with excess inventory that costs money to store, insure and can go to waste; but neither are you caught short by stock-outs.

4. Improve employee engagement

Engaged employees means lower staff turnover, which in turn leads to reduced labor costs. Engaged staff are also more effective and productive. This means you should:

·        Hire the right people

·        Provide training

·        Offer appropriate incentives

·        Share clear production goals

5. Embrace automation

Review your process to see where you can use automation to boost efficiency. Simplify the manufacturing process with automation so you can save time, make the best use of resources, ensure consistent product quality and more. Before investing in an automated system, make sure that it will meet your business needs and has flexible integration capabilities.

6. Negotiate with suppliers

Another way you can save your manufacturing costs is to ask your suppliers to reduce their prices. The first step in this process is to build genuine relationships with your suppliers. Once you’ve built a rapport, negotiating money is less uncomfortable.

Already have a good relationship with your supplier? You’ll be better placed to negotiate for discounted prices. Consider:

·        Signing a long-term contract with your top suppliers

·        Offering cash payment in return for discounts

·        Asking for a turnover discount at the end of a financial year if you’ve contributed significantly to their business

Saving on operational costs is one of the biggest goals for manufacturing companies. Most manufacturers look to streamline systems, reduce production costs, and increase profitability without sacrificing product quality. Often, the quickest and easiest way to cut costs is by accepting minimum quality levels or reducing employees. This can lead to increased product returns, warranty claims, and loss of a loyal client base that will probably increase costs in the future.

Reducing manufacturing costs is important regardless of the company size or the type of products manufactured. Estimating the cost of production is essential to manage cash flow and eliminate unnecessary spending. Reducing production costs results in more available money to innovate, grow, or save for contingencies.

Businesses have the option to lower prices and pass on their production cost savings to customers. Lower prices can increase the demand for products, resulting in more sales. The company can also offer staff bonuses or an increase in pay to improve employee satisfaction levels.

5 Ways to Engage Your Managers

There are numerous studies on the relationship between managers and employees regarding engagement. It is quite notable that most of the google searches focus on employee engagement. Or on what a manager can do to increase employee engagement.

But what about the managers? What if they are disengaged?

According to the Gallup Business Journal, 70% of the variance in team engagement across business units is explained by the quality of the manager. In other words, engagement is a management issue.

And this makes sense. Employees naturally gauge their connection and engagement with an organization through their local relationships and environments. And no one has a greater influence on those day-to-day interactions, processes, and operations than the managers on the ground with them.

Great leaders show their employees what they need to do, both to succeed in the business and help the business succeed. Engaging managers are highly motivated, efficient, collaborative and, most importantly, nurture engaged employees. 80% of employees with a higher level of trust in their management are more committed to the business. Engaged managers understand they represent their company and its values, and are committed to achieving any objectives that align with those.

Organizations need to understand what managers are doing in the workplace- build or break the engagement.

Many of the techniques that boost employee engagement often work for managers too. Thus, instead of firing your disengaged managers, look at the following methods of engaging managers.

1. Improve Communication and Growth and Development Opportunities.

The majority of managers will never accept that they are bad communicators. We take communication skills in managers for granted.

And for a manager, it might be a little humiliating to be advised to get some training to develop their necessary communication skills. However, communication training is a great option to improve their expertise.

But, it is not just for their communication skills. Managers need overall growth and development opportunities, provided these options to promote loyalty, and generate motivation.

2. Practice Empathy with them.

The key to cultivating managers' quality and improving their engagement with the organization is to show empathy for them. We often provide empathy training and urge the managers to practice it. But unless we understand the hardship of managers, the initiative would fall on deaf ears.

Thus, we should aim to instill empathy in managers by exercising compassion with them. We should seek managerial feedback and learn from mistakes while keeping confidence in the business.

3. Foster Engagement through Collaboration.

Collaborating managers are the first to be selected for intricate tasks requiring inter-departmental teamwork. Thus, instilling collaborative and engagement skills in managers is essential.

Again, collaboration and engagement are practically synonyms. So a perfect way to promote engagement is to collaborate with managers.

4. Build Transparency.

There are times when it is not possible to reveal any corporate strategies. But unless it causes any security issue, you should be as transparent as possible with your managers. You should explain why you cannot reveal some data at present. We should share the targets, objectives, and current performance reviews of the company with the managers.

5. Create a Culture of Recognition.

The longer managers take to recognize team members, the less likely employees will recognize them as engaged managers. Thus, it is a two-way process. To get recognized, managers should first learn the art of recognizing their engaged employees. On the other hand, employees should recognize managers for everything positive they do in the workplace.

Managers are often saddled with the task of raising engagement rates among their teams by senior leadership. After all, leaders often assume those managers know their teams best and have such a strong impact on the daily employee experience - shouldn't they be accountable for engagement?

But since such a small portion of managers are engaged themselves (just 35% according to this Gallup survey), asking them to take on the task of engaging employees when they're disengaged doesn't set anyone up for success.

Instead, it's better to raise the engagement levels of managers themselves if you have a significant employee engagement problem at your workplace. Those efforts will pay off in spades as both your managers and their teams become increasingly engaged at work.

Lean Quote: Who You Work With Matters To Work Experience

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.

"Your Job Satisfaction May Have More To Do With Who You Work With Than What You Do."   —  Alison Escalante

A business is only as good as its people. With staff retention, productivity and engagement now ranking as the most topical concerns for modern-day businesses, identifying ways to improve and build job satisfaction for employees must be on the company agenda in order to ensure continued success.

As adults, we spend the majority of our waking hours at work. That means our experience at work determines a great deal of our happiness, or not. We teach our kids that finding their passion, finding the job they will love is the path to a happy life.

A growing body of research findings that job satisfaction has a lot more to do with the people we work with than it does with the actual work we do. According to a Gallup poll, close friendships at work improve employee satisfaction by as much as 50%. Establishing and embedding a strong company culture isn’t achieved overnight; however, employers can help facilitate its development by encouraging socialization and communication. 

Consider the workplace environment and whether colleagues can talk and share ideas. Organized social activities outside of work hours are beneficial; organizations who encourage birthday celebrations or attend events together demonstrate greater engagement and contentment at work. 

Managers have the most significant impact on happiness at work and job satisfaction. Gallup has discovered that 70% of the variation between great workplace engagement and poor workplace engagement can be explained just by the quality of the manager or team leader. Managers are most effective when they make a shift from manager to coach. Engaged employees report higher levels of wellbeing and experience more happiness at work.

How does the work environment impact employee motivation?

“The only way to do great work is to love what you do” 

The above quote given by Steve Jobs highlights the importance of being motivated at work. Besides, being motivated at work comes with lots of internal and external factors and the work environment is one of them. A positive work environment can help motivate employees to work harder, stay with the company longer, and increase productivity. Conversely, a negative work environment can have the opposite effect, leading to decreased motivation and higher turnover rates.

However, a good work environment also consists of many important factors that contribute together and make a great work environment. That being the case, in this blog, we will discuss various factors of the work environment that can positively or negatively affect the motivation of employees in a workplace. 

5 work environment factors that can impact employee motivation

1. Physical environment: A physical environment in which employees stay for 8 or more 8 hours has a significant impact on the work environment of the company. Nobody majorly pays emphasis on it but even the comfort level of the seat where employees sit can also impact their motivation.

Other than that, hygiene, lighting and aura of the physical environment can also impact the workplace motivation of employees. A comfortable and well-lit workspace can help employees feel more at ease and focused on their tasks. On the other hand, a cramped, cluttered or poorly lit workspace can be distracting and cause employees to feel unmotivated.

Hence, it is very crucial for employers to create a work environment where employees feel comfortable and enjoy their work while sitting in the physical environment. Many companies are already understanding the same and 70% of the company leaders are investing in maintaining healthy physical environments in order to encourage healthy behaviors in the workplace.

2. Leadership styles: We have often heard that people don’t leave companies, they leave management. This is because the management style of leaders can significantly impact the work environment of the employees. There are various leadership theories that are opted by modern leaders to control their workforce.

Leaders who are approachable, and supportive, and provide constructive feedback can help employees feel motivated and engaged in their work. Conversely, leaders who are critical, unapproachable or micromanaging the employees can lead to decreased motivation and job dissatisfaction.

3. Recognition and rewards: Employment statistics state that in total 39% of employees feel under-recognized at the workplace. Moreover, 77% of the employees state that they would even work harder if they were more appreciated at the workplace. However,  a positive work environment is one where employees are provided with opportunities to feel recognized and rewarded for their efforts.

Recognizing employees for their hard work and providing rewards such as bonuses or promotions can help motivate employees to work harder and stay with the company longer. Moreover, when employees are rewarded, it boosts their self-esteem and turns them into more confident employees which will ultimately boost their productivity and benefit the company in terms of growth and revenue generation. 

4. Work-life balance: A positive work environment should always provide opportunities for employees to achieve a healthy work-life balance. Offering flexible work schedules, giving open communication options, and time off for personal or family trips can be a few ways to offer a healthy work-life balance to employees. This would help employees feel more motivated and engaged in their work.

Employee statistics state that 77% of employees are experiencing burnout at least once at their current jobs. When employees are negatively affected by this factor, this negatively impacts their performance as well.

5. Organizational culture: The culture of an organization can have a major significant impact on employee motivation. A culture that values collaboration, open communication, and positive feedback can help employees feel motivated and engaged in their work. Conversely, a culture that values competition over collaboration or that is highly hierarchical can lead to decreased motivation and job dissatisfaction. 

Hence, employers always need to ensure that companies should have a healthy organizational structure that would help in creating a positive environment altogether. This would help in ensuring that employees are getting healthy feedback and are successfully collaborating in the workplace. 

In conclusion, the work environment can have a significant impact on employee motivation. A positive work environment that values collaboration, and open communication, and provides opportunities for recognition and rewards can help employees feel motivated and engaged in their work. Conversely, a negative work environment that is cluttered, hierarchical, or unapproachable can lead to decreased motivation and job dissatisfaction. As an HR professional, it's important to create a positive work environment that supports employee motivation and engagement, which in turn can lead to a more productive and successful company.

About the Author: Jessica Robinson loves to write interesting and knowledgeable blogs regarding business management, education and life to satiate the curiosity of her lovely readers. Currently, she is serving as a content manager at the ‘Speaking Polymath’. Every piece of content that she writes demonstrates her immense love and passion for her profession.

Develop Employee Through Problem Solving

Problem solving is a vital skill in the workplace. The ability to think logically and creatively empowers individuals to tackle challenges and seize opportunities in all levels of business.

At its most effective, problem-solving allows employees to seamlessly engage in the psychological process of realizing, evaluating, and resolving daily challenges. At the core of business development, the ability to problem solve allows employees to learn to use accessible resources to work out issues in a productive manner that does not betray your company’s integrity.

A workforce equipped with problem solving skills will be adaptive and ready to face the challenges of the constantly evolving modern workplace. Its employees will demonstrate an ability to:

• Listen actively
• Think analytically and creatively
• Come up with innovative solutions
• Communicate effectively
• Make decisions confidently based on evidence
• Work together as a team

Additionally, employees can reach an agreeable consensus using professional perspectives afforded to them by applying problem-solving skills. In the long run, companies who utilize problem-solving training will allow their employees to efficiently and productively manage any internal or external interactions with a professionalism that will only benefit the business as a whole.

It is not the job of the leader to solve all the problems. The leader’s job is to clarify and help define the problem, find the problem owner and see that the owner takes responsibility for its solution.

Great leaders don’t subscribe to a “Do-It-For-You” methodology of talent management, rather they lead, mentor, coach and develop team members by getting them to buy-into a “Do-It-Yourself” work ethic. They view each interaction, question or even conflict as a coaching opportunity. Don’t answer questions or solve problems just because you can, rather teach your employees how to do it for themselves. If you make it a habit of solving problems for people, you simply teach them to come to you for solutions at the first sign of a challenge.

Leaders at Toyota believe that showing respect for people means you allow them to think for themselves and solve their own problem.  It is often said that the mission of Toyota is about developing exceptional people who happen to make great cars.  The point is that it is more about people and less about the problem.  The problem is another opportunity to teach them a skill for lifetime.

A team that can confidently solve problems will see problems as an opportunity to initiate change and growth, which will help to keep the business ahead of competitors.