Owning a Small Business is Very Educational

If you are a regular reader of Beyond Lean,  you may know that my wife has her own small business.  It is just her and I.  She runs the business 24/7 and I help where I can on nights and weekends.

Both of us have learned about a wide range of business aspects over the last couple of years from her small business.  My wife has a background in marketing, but has learned a lot about IT and web design, materials, costing, production of a consistent product, using data to determine what the customers like and a lot more.

I have been working quite a bit with display booth setup and teardown (quick changeovers), preparing raw materials for usage and investment decisions.

When owning and running a small business a person can see everything from end-to-end.  How a packaging decision can affect sales?  How does shelf life of a product have an effect on the quality?  How do certain ingredients react when mixing for production?  Do they cause immediate quality issues?  Do they cause quality issues over time?

In our experience, we have seen how lean thinking can be more natural for a small business.  There is more of a concern about inventory and cash on hand, so there are many decisions that go into building to stock or building to order.  Using visual management to make things easier to see when work needs to be done or not.  I have some examples from my wife’s business that I will post at a later date as well as examples I have posted in the past.

I have learned numerous things from working with my wife in her small business that I carry on to my other job as lessons to apply.

Owning a small business is very hard work.  You have to learn about things that don’t necessarily interest you, but if you want to be successful you have to get it done.  In the end, it can be very rewarding and extremely educational.

How Problem Solving and Agile Both Drill Issues Down

I have been learning about agile as of late.  I know how agile has gotten its roots from lean thinking as it is applied to software development.  It has been very interesting and fascinating to learn.

One common thread problem solving and agile have is making it important to break down the issue.

Good problem solving breaks down a large problem into smaller and very manageable problems to solve.

Agile does the same.  It is important to break an epic story (or very large story) down into manageable stories that can be built and tested in 2-3 days.

Click to enlarge

This is just one similarity between lean and agile I saw as I was in my class.  Seems simple but it really takes team to master to bet able to break stories and problems down to the appropriate sizes.

H&H Color Lab – American Company Growing Through Lean

H&H Color Lab began in the basement of Wayne and Shirley Haub’s residence in a suburb of Kansas City, Missouri, in 1970. Wayne and his brother, Ted Haub, owned a portrait studio that had just landed its first high school senior contract. With a background in and love for color printing, Wayne chose to install his own color processing equipment in the basement of his home.

Business increased, and so did the need for additional space and employees. What began with Wayne doing everything from his basement has grown to 165 people and 55,000 square feet of space over 40 years later.

H&H customers are primarily school/portrait/wedding photographers.  The offer a wide range of products from photo prints to books to Leather bound albums and digital products.

In 1999, H&H Color Lab started is Lean journey led by Lee Gabbert.  Lee had been with the company for 5 years at the time and was chosen to learn more about lean and teach others at H&H.  They started by reading “Lean Thinking” by James Womack and Daniel Jones.  H&H also decided to get a sensei to help them learn as they traveled the bumpy road down the lean path.

H&H Color Lab started by setting up work cells, going away from a department mentality. H&H moved to smaller batches, moving cells closer to the monuments (that they couldn’t move), standard work, and lots and lots of 5S.

Muda (waste), lead times, late work and quality all had improved. In fact, the gains from lean had now freed up space that was once occupied by manufacturing departments.  It allowed H&H to take the space and use it as a training facility to help customers from all over the United States. Thus, H&H University was born. Roughly 3,000 square feet of space was now designed and transformed into a learning center, working photographic studio with equipment, mock up photography sales room, photography studio work area, kitchen to host all day training, library sitting room with sample products that H&H produce on the book shelves and restrooms. By providing training for customers (mostly free of charge), you truly can engage in a partnership that can grow.

All of this work allowed H&H Color Lab to make a success transition from the “Age of Film” to the “Digital Age”.  Understanding their customers and providing training and education others companies do not, shows how the most important part of lean, focusing on the customer, helps you innovate, grow and thrive.

Here are results that H&H Color Lab have seen from their lean implementation.

	1999	2012	% Change
Late Orders	3,076	25	99% reduction
WIP	10,421	1731	83% reduction
Redo	5.3%	1.3%	75% reduction
% Shipped Late	49.3%	5.8%	88% reduction
Time in Plant	7 days	1.1 days	84% reduction
Sales			22% increase

Visual Management at Home

I received this picture from a guy I worked with and coached for a couple of years.  I am sharing this with his permission

(click on image to enlarge)

He and his wife would go to the store and if there was a sale, they would buy meat.  They never knew what they had at home.  When they got home from a recent trip they had bought meat they had plenty of…again.  So my friend decided to get visual.  He sorted out the meat that had gone bad and then created this visual board to better understand when he needed to buy a particular type of meat.  He likes to barbeque so he keeps a variety of meat on hand.

The board is simple.  Conveys one type of information.  And anyone can understand it by looking at it.

What visual management have you used at home?

Root Cause and Guns

Normally, I don’t dive into the hot politically charged topic of the week, but the gun issue has really struck a cord with me.  I don’t care which side of the issue a person falls on, right to own a gun or very strict laws almost preventing gun ownership.  Everyone has a right to their own opinion.

The issue I have is with people, more accurately politicians, using tragedies to further their own agenda without understanding the true root cause.

Sandy Hook was an enormous tragedy.  I went home that night and hugged my kids and didn’t let them go the entire weekend.  What happened shook me at my core.

What has happened since then has been upsetting also.  Laws are proposed and passed on gun control that do not address the root cause of why these type of mass shootings are happening.  Guns are being obtained legally and with background checks.  A lot of these people are not any system as having “issues” or being arrested or whatever the case may be, so they will pass a background check.

Stricter background checks can just cause people to get guns illegally.  It is just like making alcohol illegal in the U.S.  Prohibition in the 1920s didn’t stop alcohol from being made or consumed.  It just made it illegal.  People went into business with distilleries and crime went up because of it.  Not just the  making and consuming of alcohol but people robbed and killed over it to build empires because no one would call the cops if a criminal stole from a criminal.

If a person wants a gun bad enough, they will get it.

The question is, “What is causing people to want to do these acts?”  How do we prevent people from wanting to do something like this?  Do we need to work harder on stopping bullying?  Do we need to help to make people better aware of how a stable family can help?

I don’t know what the answer is, but I do believe that what has been going on for years with just looking at controlling guns is not the answer.  It hasn’t’ worked since the Columbine shootings and I don’t see it working moving forward.

What are your thoughts on helping to prevent the root cause of gun violence?

Understanding Single Piece Flow

One of the first concepts that pops up when learning about lean is single piece flow.  This is a great concept and should be considered when it is appropriate.  Cooking my french fries might not be the time to use single piece flow, but downloading songs may be.

My wife runs a small business of her own.  She sells products online through her website and Etsy as well as events in our local area.  Selling online and brick-n-mortar poses problems from time to time.  One issue is wanting to provide a wide range of scents for customers, but not having large amounts of inventory on-hand because of the batch process of making the soaps in loaves.

After a year and a half, we think we find a solution to this issue.  Most of her requests for custom scents come through her online sales.  Typically, she has the fragrance available but can’t justify making 8 bars in a batch because the other 7 may sit for a year or longer.  She has found a mold that works very well and is the size she needs that allows her to make one soap at a time.  My wife can now fulfill the requests of her customers and offer more fragrances to her line in her online shop without the expense of carrying a year’s worth of finished product.

What about the live events to sell the inventory?

Good question.  The events are always in the Sept – Dec time frame.  So, if a customer orders a special scent in January, the rest of the finished goods would sit until September at the earliest.  She could have used the raw materials for other products.  The soaps that are high volume sellers and do well at the live events can be made in batches right before the event.  Any finished product that is leftover after the event season can be sold online.

It is a good mix of using single piece flow and batch processing when it best fits the situation.  It is about understanding your business needs and trying to meet those needs.  Not forcing everything to one solution whether if fits or not.

What makes sense for your business?

Happy Thanksgiving!

Image courtesy of David Castillo Dominici / FreeDigitalPhotos.net

Today is Thanksgiving Day in the U.S.  A day to stop and give thanks for things in life.

I would like to pause and thank Joe Wilson for joining Beyond Lean this year as an author.  He has made great contributions.  Here are just a few of my favorites:

• My Half Full Glass of Studying
• Does Brainstorming Work?
• Problem Solving Pitfalls

I also want to thank all the readers.  Without you, Beyond Lean wouldn’t be here.  Thanks for taking time out of your day to read what we post here.

Have a Happy Thanksgiving!

Data Collection Thoughts

One thing that seems to come up a lot in terms of continuous improvement activities is the need for data.  Sometimes there isn’t the right data, sometimes there isn’t enough context to the data, and sometimes there just isn’t any data recorded at all.   I’ve written about data in terms of metrics and measurement systems before, but this time I’m more talking about getting your hands on information that becomes clues to solve your production mysteries.  I don’t believe in substituting data for observation, just in using it narrow the observation lens.

So…what are some of my key thoughts for getting data to make sure you are working on the right stuff?

• First, make sure your data tool can tell you what you need to know.   If it’s a log sheet of some sort, does it capture major sources of variation such as time, position, cycle, machine, tooling set, etc.?  If it’s a measles chart (or concentration diagram or whatever name you may use), can you really tell the difference in defect locations on it?
• Next, be willing to sacrifice some clarity in some areas to get an overall picture of the process.  I like to start by targeting about 75% of the data that I’d like to have and adjust it from there if need be.  Most of the time I find that the extra detail I thought I needed wasn’t really necessary at this stage.  I can always build additional data collection if I can’t get what I want from the reduced set.
• Also, try to make it as easy as possible.  If you can extract what you are looking for from existing shift logs or quality checks or some sort of automated means, go for it.  Adding a layer of work can sometimes lead to reduced data quality for everybody!
• To go along with the previous item, remember data isn’t usually free.  If you don’t need the data collected indefinitely in the future, set an expiration date on the activity and free up the resources.
• Lastly, to paraphrase myself, data isn’t a substitute for going to the gemba and seeing the problem for yourself.   Double check the data against what you are seeing with your own eyes to make sure that it can really help you.  This data won’t solve problems for you, but it can help you know which ones are the biggest.

I’m sure there are some other key points that I’ve left out, but there are a few for starters.

Now, I’m sure some of you are asking, “Why waste time on this and why not just go observe the process at the start?”  Good question.  I think this is more of a helping hand to make the best use of time for some operations.  If there are limited resources (and who doesn’t have limited resources?), deploying this in advance of a deep dive can help speed up the search for solutions.  If a process has a long cycle time or unusual frequency, something like this could help identify repeat issues vs one-offs.  I am always looking for the best way to use what I have at my disposal and sometimes it doesn’t fit the textbook methodology.

Failing a Test Can Be a Good Thing

Too often we look at failing a test as a negative thing.  The word fail has such a negative connotation, but it doesn’t have to be negative.  Fail can tell us what something isn’t or where we need to improve.

Failing part of a knowledge test can tell a person where their knowledge gaps are.  Knowing the gaps is the first step in gaining more knowledge.  Filling the gaps leads to better output.

Another way fail is look upon negatively is when testing a condition.  When trying to determine the point of failure or the root cause of something tests are run to verify the hypothesis.

Typically, when a test fails people are disappointed and can even get frustrated.  The assumption people make is they should know everything in their world.  Be the expert.  Being the expert means knowing where the point of failure or root cause is right away.  That can’t always be the case.  If it was, then a lot of the problems would be taken care right away or wouldn’t exist.

Taking the perspective of learning, failing the test and not confirming the hypothesis means you have a better understanding of what it is not.  That is valuable information to know.  Knowing what it is not helps to narrow the search.  Getting you closer to the answer.    Ruling things out is the next best thing to finding the point of cause or the root cause.

Like a doctor.  You go in sick so they test for the flu.  It comes back negative.  You are still sick but at least you know it isn’t the flu.

Concentrate on learning from all tests and failing won’t be such a bad thing.

Random Problem Solving Skills

I’ve been in a really reflective state lately as I try to weigh some different opportunities.  While I have come up with some really interesting topics for posts, most of them have turned too lengthy or incoherent to clog your Lean reading time.  One of the discarded themes has also come up a couple times lately in conversation and I thought I’d throw it out in print.   Here are three of the less obvious skills that have served me well in solving problems and working in continuous improvement activities over the years.

The first one is utilizing some sorta advanced Excel skills.  For all of you statistics nerds out there, I totally agree with you that Excel is not statistical software.  But it can be really, really helpful in sorting out piles of data in to something useable in a hurry.  For me, sometimes digging through the raw data can help highlight a pattern that I can’t see in aggregate.   Sometimes it can help put information in context and help people make better decisions faster.  I have used functions from Pivot Tables to conditional sums to writing macros (with some excellent assists from Matt) and so on.  It’s not sexy, but it is helpful.

The next skill that has served me well is another Office tool…PowerPoint.  I’m not talking about fancy slide transitions with animated gif’s and musical accompaniment.  I’m more referring to using the existing toolbox to tell concise, effective, clean stories.  You could argue that A3 reporting is much more concise and clean (and I’d agree), but PowerPoint is still massively used.  The ability to create a visually appealing communication is valuable for almost everybody.

Another skill that seems to be on and off the radar is the ability to filter information. Learning how to quickly separate signals from noise is a very underrated skill and one that needs your attention.  Every person and every idea deserves respect and consideration.  But not every idea needs to be implemented.  Abnormal situations should get due attention, but not every abnormal situation should be weighted the same in terms of response.  Developing the ability to say “no” or “not right now” with a reasonable justification can save a lot of inefficiency.

That was my quick list of unspoken skills (in no particular order).  For the record, I’m not propping these up because I consider them strengths of mine.  They’re just things that I do well enough to not do too much harm when I try to bust them out.  Mostly they’re things that I’ve picked up from others and tried to emulate.   What about you?  Do you think I overrated any of these?   Any other not-just-Lean traits that you use or seen others use effectively?