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Open for Business

I have had a hard time keeping up with the blog this year for a very good reason.  Regular readers may know that my wife has had an online business selling handmade soaps and bath and body products that she makes.  Over the last 4 years revenue has continued to grow at an incredible rate.  So much so, that we out grew out house a year ago and have been searching for a space outside the house to make the products.

Everything finally fell into place.  On Saturday, July 5th, 2014; Crimson Hill Soapworks and Gift Market retail soap opened for business.

Grand Opening Collage

It took almost a year and a half to find a place, negotiate the build out and rent, get the work done to the space and then set up the retail space and the kitchen.  The opening went better than we could have hoped for and now we are fully open for business.

Are we using lean in the business?  You bet.  We aren’t perfect and we have a long way to go, but we have always applied the biggest tenant of lean from the start.  Focus on value for the customer.  We believe the customer sets the market price for the product and our profit is that price minus our cost without suffering quality.

We know our target market and that is who we aim to please.  Our products may not be for everyone but for our target market we want to drive a high value proposition.

Here’s to new adventures!

Lean Culture Change

Recently, I had the opportunity to tour a local company that does sheet metal work.  The company does not advertise being lean, although they are a part of our lean consortium.  When you walk in the manufacturing facility you would be surprised at what you DON’T see.  There aren’t 5S markings or visual production boards or kanban levels anywhere to be seen.

What the company is doing is the hard work.  The are working to change their culture.  They are focusing on it everyday from the leadership down to the floor.

The company is Webco Manufacturing.

What they have done is come up with The Webco Way.  Thirty-one fundamentals for everyone to focus on improving.  Here are just a few:

  1. Do the right thing
  2. Check your ego at the door
  3. Take ownership
  4. Practice blameless problem solving
  5. Be process oriented
  6. Continuously improve everything you do
  7. Embrace change

These are just a few.  I encourage you to visit Webco’s website to see the complete list and a description of each.

You might think 31 is a lot to remember.  I did too, but it is working for them.  They focus on one fundamental every single day.

A fundamental is chosen for the week.  A member of the leadership team sends out their perspective of the fundamental for the week every Sunday night to everyone with e-mail in the company.  During the week, every meeting consisting of more than 2 people is started by reading the quick description of the fundamental and giving an example of how it is brought to life.

This includes meetings with supplier and customers.  The meeting could be 1 Webco employee and 5 suppliers but they will start the meeting with the fundamental of the week.  This is to let customers and suppliers know what they are trying to do and helps to drive the same expectations from their customers and suppliers.

Webco may not claim to be lean, but the culture they are driving and the way they are going about it sure seems like a lean culture to me.

What are your thoughts?

It’s About Knowing Your Audience

Decisions Don’t Start with Data.  This was a post found on the Harvard Business Review Blog.  This is another attempt to explain how marketers are the kings of the world telling us what we should buy and we are too stupid to know otherwise.

We buy goods and services because we believe the stories marketers build around them:  “A diamond is forever” (De Beers), “Real Beauty” (Dove), “Think different” (Apple), “Just do it” (Nike).

That was my favorite excerpt from the post.  Thanks marketers, because I wasn’t sure what running shoe I wanted but “Just Do It” has now made up my mind.

The point I got from the post was that people don’t make decisions based on data, it is based on emotions.

To influence human decision making, you have to get to the place where decisions are really made — in the unconscious mind, where emotions rule, and data is mostly absent. Yes, even the most savvy executives begin to make choices this way. They get an intent, or a desire, or a want in their unconscious minds, then decide to pursue it and act on that decision. Only after that do they become consciously aware of what they’ve decided and start to justify it with rational argument.

While I do believe this is true.  It does not mean it is right.  Just because executives do this does not mean we should succumb to their ridiculous decisions and not present the data.

I do believe we make decisions on data, whether it is consciously or subconsciously.

Apple may say “Think Different”, but if their product is crap and is breaking all the time a person wouldn’t buy it.

“A diamond is forever” doesn’t make me buy from DeBeers.  It is there customer service and quality.

There was some form of information that is driving the decision.

I do agree with the author that when presenting a group with a new and possible radical idea that a person should approach his audience in a way that will get their attention.

For some that may mean presenting straight data.  For others, presenting a story or a “what’s in it for me?” point of view and weaving the data in.

This isn’t about data and decision making.  It is about knowing your audience and adjusting your approach to help meet the audience see your point of view.

Apple Store Not Focused on Customer

I do like the Apple products.  I have found them to be easy to use and high quality.  I have the original iPad (although half my apps won’t update anymore) and I think the Apple music players are still the best on the market.

That being said, I think Apple is very limiting in it’s openness and they will do things their way at the cost of customers at times.  I use iTunes as an example.  It is very hard to buy music, books, movies, etc… on iTunes and then be able to use them on an Android device.

Recently, I had another experience that showed me Apple wants things their way and aren’t focused on the customer.  I bought an iPod Nano for my wife for her birthday.   I ordered it online so I could have it engraved and picked it up at a local Apple store which was the first time I had ever been in an Apple store.  My wife used it 3 times, did not drop it and the screen has completely popped off.

I decided I would take the 30 minute drive to the closest Apple store and get the iPod replaced.  I arrived at 2:30pm and was greeted by someone who then handed me off to someone else to here about my issue.  They were glad to exchange the iPod but there would be no engraving since they don’t do that in the store.  I wasn’t happy about that but the engraving was free and I was hoping to walk out with a new iPod so I was too worried about it.

I was then informed that I couldn’t exchange it until 6pm that evening.  Three and a half hours later!  My first question was “why?”.  I was told a technician had to do it and the earliest appointment for a technician was at 6pm.  Of course, I asked “why does a tech have to do it?”.  That is when I got my favorite response of all time, “Because it is a legal transaction and serial numbers needed to be written down.”

My jaw hit the floor as I asked how long it would take and the woman said, “Oh it will take less than 10 minutes.”

Now my eyes popped out of my head.  So, I was going to have to wait 3.5 hrs for a tech to do a less than 10 minute transaction.  A transaction that would have already been done by any worker in the store if I would have bought the iPod at Target or Walmart.

My first thought is that Apple does not respect their store employees because they don’t trust anyone to do a simple exchange transaction.  Really.  Think about it.  Think about some of the people that have done exchanges/returns for you at Walmart.  The process shouldn’t be that hard.

Secondly, here I am.  An upset customer because a barely used product 2 weeks old is completely busted and now I will have to wait 3.5 hours to get it exchanged.  Now I am doubly upset.

I did not have time to wait and took my iPod home.

A few days later, I took the iPod to the Apple store close to my place of work.  I went in without an appointment just to see what would happen.  I got a new iPod in minutes and was out the door.

I’m not sure if that was an Apple policy or a store policy causing the issue at the first store.  Either way, they weren’t focused on creating a good customer experience which can lead to lost sales and in my case my just do that in the future.

Blog Reader Survey: I want to hear about your needs from the blog

Recently, I have been participating in a series of conversations with a small group of other bloggers about how to improve the online lean learning community.

We thought it best to start with what you thought, so we’d like you to take a few minutes to answer a series of 10 questions to get us going.

As a thank you for your help, this link will take you to a zip file with some free content from Jeff Hajek, Chad Walters and myself.

Link to our survey

Meet Customer Expectations AND Have Operational Excellence

I am way behind in my blog reading.  When reading some of my backlog, I found this great post by Brad Power over at Harvard Business Review.

Why was it great?  Brad talked about how meeting the customer expectations and operational excellence are not opposites.  Business should be doing BOTH and the ones that do have great success.

What is more important to company success, a strong external focus on customer experiences or an internal focus on effective and efficient operations?

Of course, it’s a false dichotomy — you need both. I described in an earlier post how Tesco worked for years to improve its supply chain capabilities, then leveraged this value by using deeper customer knowledge to enrich customer experiences.

Brad uses two great examples.  One is L.L. Bean that provides goods to consumers.  The other is ThedaCare which provides medical services to people.  He shows how meeting customer expectations and having operational excellence can work in either industry.

Many hospitals began pursuing the “triple aim”: better patient experiences, consistent quality, and lower costs. Hospitals such as Virginia Mason and ThedaCare adopted process improvement systems from manufacturing (“Lean” and the “Toyota Production System”) to deliver increased consistency, reliability, and quality. While skeptics are right when they say, “Patients are not cars,” the reality is that medical care is, in fact, delivered through extraordinarily complex organizations, with thousands of interacting processes, much like a factory.

Most in the lean community are aware of the great work ThedaCare and Virginia Mason have been doing.  It is great to see it highlighted on the HBR Blog.

Something that the lean community has stressed for a very long time is focus on delivering value for the customer first and then determine how to deliver that value as efficiently as possible and with no waste.

There is so much written about lean that is wrong or misunderstood.  It is great to see a post discussing how companies can use lean properly to help them compete and win.

Should All Customer Feedback Be Transparent to Others?

Is all customer feedback accurate?  Should all customer feedback be displayed?

My first reaction was absolutely all feedback should be displayed.  This is great transparency and help drive improvement.  If you don’t want negative customer feedback then provide a good experience.

I now have changed my tune a bit.  I do believe that customer feedback should be transparent, even the negative.  What I don’t believe is that all feedback should be displayed because there is some of it that is flat out wrong.

It is one thing to have your business not provide a positive experience and actual events posted about that versus an experience that is just not the case.  This is easier to monitor and see in small businesses.

The ideal state is that no bad experiences happen and a customer never receives bad quality product.  Unfortunately, that is not always the case.  If a customer receives a product they are not happy with the provider should have a chance to correct the situation.

In recent months, I have seen where customers are posting negative comments on small businesses that are flat out lies.  Either talking about the business not working with them to correct a situation when the customer never even contacted the business to correct the situation or describing a defect that is not even physically possible with that product.

Understanding unsatisfied customers is a great thing to help improve your  business.  False information that can damage a business is just wrong.

So when using the customer reviews, you must be cautious with what you read.  Understand all the feedback and try to make an educated decision.  Heck.  Even contact the business and ask questions to help you feel more comfortable.

Harvard Business Review Talks about Listening to Customers

The number one tenet of Lean is listening to your customers.  The company should derive what is of value for the customers from the customers.

Let Your Customers Streamline Your Business, posted by Lisa Bodell, discusses this very topic in detail.

So rather than relying on internal perspectives alone, engage your customers in developing simplification ideas…

The blog talks about simplifying products and services to help retain customers and increase customer satisfaction.

This simplification isn’t necessarily “dumbing” down the product or service.  It is about eliminating the waste in the product/service.

The first part of the definition of waste is the customer is willing to pay for and finds value in the feature.  If they don’t find value then it is non-value added waste.  The only way to understand what the customer believes is of value is to engage the customer.

Lisa talks about five ways to engage the customer:

Listen to your critics. Does your organization ask for customers’ feedback about what it was like to do business with you? What about asking non-customers why they don’t do business with you?

Roast your products and services. Comedy Central gained attention from its famous Roasts, where a celebrity gets torn to shreds with hilarious insults doled out by the audience. Try out this practice on your company’s products or services.

Turn pains into gains. Think about actively asking your customers about their pain points when it comes to working with your organization and its products or services.

Figure out what your customers do all day. Think you know your target market? Not just their demographic, but what their life is actually like.

Learn from other industries. Sometimes businesspeople think their company has unique circumstances; that problem-solving strategies that have proven successful in other industries wouldn’t work for them. This could not be further from the truth.

While there is a lot of traditional business thinking that I completely disagree with on the HBR blog, this one is dead on.

The best way to increase adoption of your product/service and gain customer loyalty is to listen to the very customers that are you targeting.

Agile Brings Flexibility to Software Development

Lean thinking is about creating flexibility in the manufacturing process in order to deliver the value that customer wants at that time.

In agile, this is also true.   The beauty of using agile to develop software is the work can be prioritized on a daily or even more frequent basis.  As the development team completes a requirement and it moves to the “complete” pile, the product owner can determine which of the remaining requirements is the most important to complete next.  The product owner is closely linked with the customer of the software so they are the voice speaking directly for the customer.

If new requirements come up during development, no problem.  Add that requirement to the back log on the kanban board.  The next time it is time to pull a new requirement the product owner can prioritize the new story at the top or not.

This creates a lot of flexibility in the development process that a waterfall process does not.  Usually, with a waterfall development process all the requirements have to be determined up front and then frozen because adding any after that can cause issues.  Then the customer doesn’t see anything until the development is completely done.  The agile process allows to release pieces of functionality as it is ready.

This increased flexibility allows the team to deliver more value sooner to the customer, creating a happy customer.    Which is what lean is about.  Customer first.

Value Stream Management at Schlitterbahn

My family and I had a nice day at Schlitterbahn waterpark a couple of weeks back.  It was a lot fun and the rides were great.  While waiting in line for each of the slides, I couldn’t help but think about the very poor value stream management for the rides.

For one set of three slides,  the line was split in two.  For two particular slides the line was to the right and for the third slide the line was on the left.  When you got to the top the lines then crossed each other causing a ton of confusion and a park employee trying to keep the lines separate and correct.  See the diagram below.

Schlitterbahn_Lines

Also, if one of the first few didn’t want to ride one of the two slides from the line on the right then that slide would sit idle for a few minutes until the riders on the other slide unclogged the line.  It was a waste of time and use of the one slide.

There was a second group of three slides at another part of the park.  At this group of slides, two of them needed mats to ride down and the third needed a tube to ride the slide.  They didn’t mark this line with two separate lines so people had to tell you there were two lines.  Also, the mats for two of the slides were not stored at the entrance to the slides but at the exit.  You had to fight people through the exit, get a mat, then walk back around to the entrance.  All the tubes were stored at the entrance for the one slide.  This caused over an hour wait for the one slide but only a 10 minute wait for the 2 slides with the mats.

The way the park handled the value streams for the slides caused unbalanced lines and confusion for anyone that had not been there before.  It was a great lesson in making things visual and easy to understand in order to make a better experience for the customer.

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