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Poll: Understanding Lean at Your Company

I wanted to try to understand how lean is working for the readers of Beyond Lean.  This is not a highly scientific poll just three quick questions to see what size company the readers work in, how they are trying to implement lean and if you believe your company is sustaining and growing the results from lean.

Thanks for continuing to read Beyond Lean.

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Lean Concepts are Intertwined

When working with an area, department or organization to implement lean people like to focus on implementing a specific tool or concept, but it’s not that easy.  The concepts and tools are so intertwined that focusing on one is really difficult to do.

An example would be implementing SMED (or quick changeover) across a facility.  A vast majority of the time a large opportunity for improvement is through organization, having the tools you need where you need them and knowing when and where to be for the changeover.  Immediately, other concepts that come to mind are visual management to understand when and where to be without having to ask.  Also, 5S which can help with organization and having the right tools at the right spot.  5S is also a component of visual management.

A second example is implementing strategy deployment.  There is standard work to how to cascade catchball down through the organization and it should be documented to be repeatable.  Then the strategy is usually documented on an A3 to help communicate the message and most companies use visual management to show progress to the entire organization as time progresses.

As a person working to help others implement lean, it is OK to let them believe they are only focusing on one concept to start.  Sometimes thinking about the intertwined concepts can become overwhelming.  Let the customer focus on the one concept and introduce the other concepts through the backdoor.  There is no need to call out the lean concept.  Just discuss what a way to help them solve their problem in further implementing the concept the are focusing on.

At a later date, you can show them how they have actually implemented other lean concepts successfully.  This helps build their confidence, shows further progress then what they believed and builds momentum to continue moving forward and taking more on.

Don’t get hung up on explaining all the intertwined concepts.  Delivery on the needs of the customer and it will all work out.

5S at the Gym

Over the last few weeks at the gym I have noticed some good examples of 5S and some very poor examples of 5S creating clutter.

dumbbell_rack

 

A good example of 5S is the placement of weights throughout the gym.  The dumbbell rack has the weight labeled on the racks so you know where to put the dumbbells when you are finished.  The small barbell rack is labeled with weights to know where to put them back as well as the free weight trees.

 

This is a prime example of having good 5S does not change behavior.  It just creates the ability to see an abnormal condition quickly.  The dumbbell rack is always kept in good order and dumbbells are always in the proper place.  But the free weights and small barbell weights are NEVER in the correct spot.  I can spot the issue quickly and I can take action to find what I need.  For the life of me, I still can’t figure out how the same people can put the dumbbells in the correct spot but 10 feet away not put the free weights or small barbells in the correct spot.

A bad example of 5S in the same weight room is not having a place to put attachments for the cable pulley machines.  These machines have a ‘W’ shaped bar, a straight bar, a rope and handles to do different exercises and work different muscles.  I have never seen one of these machines with a spot labeled for these attachments.  All the attachments lay on the floor an ‘walk away’ between different machines.  Half the time I spend looking for the attachment I want for my exercise.  It becomes very frustrating.  I can’t even tell quickly if the attachment I need is in the pile laying on the floor.  Once I recognize it isn’t, then I have to go and look at the other machines or decide to change my routine.

Just because you have a place for some things, does not mean you are finished with your 5S efforts.  And once you have a place for things, it takes constant monitoring to make sure the efforts don’t slip and the area ends up back in chaos.

What is 5S?

5S is a process to achieve a safe, efficient and organized workplace.  It allows people to see if things are abnormal quickly, so they can address the issue.  It does not keep people from doing something.  5S just allows someone to see if something isn’t right quickly.

The Five S’s are:

  1. Sort – Decide what is needed and what is not needed.  Get rid of the things not needed.
  2. Straighten – Understand how things are used and put them in an appropriate place for the work space.
  3. Shine – Clean and label the area.
  4. Standardize – The work you have done is the new standard and needs to be kept that way.
  5. Sustain – The hardest part is not to let the work space degrade.  Put checks in place to keep the standards in place.

Quite often 5S is equated with being lean.  A large number of people believe that 5S is foundational to being lean. The thought is 5S is the first thing an organization must do to be lean.  That is not necessarily the case.

Something as simple as organizing the workplace can help improve the efficiency of many things you do.  I have seen 5S help gain large improvements with quick changeovers of machines.  Looking for tools always seems to be the biggest waste when breaking down a setup of a machine, so having the tools in a particular spot every time can help a lot.

5S is not just for the manufacturing floor.  It can benefit any work space, including in the office.  But you do have to be careful.  When it comes to 5S in the office many people get carried away.  They prescribe marking where the computer should be and taping an outline around the stapler at everyone’s desk.  This isn’t the purpose of 5S, so be sure to do 5S correctly in the office in environment.

Think of a NASCAR garage when doing 5S.  It is spotless.  The reason, so any drip from the car can be seen immediately and the problem can be addressed.  You can’t go too far with organizing your work place.

5S is hard work.  The hardest part is sustaining the work of the first 4S’s.  Sustaining the work takes discipline.  If the discipline is maintained the rewards of 5S can be great.

Good luck on your path to success with 5S.

Use the Right Visual

Visual management and visualization is a concept that lean relies heavily on.  There are a lot of standard visuals like metric boards, kanban signals, 5S and value stream maps.

Visuals really help people understand the information.  Everyone sees the same visual and it starts a good conversation allowing people to gain high agreement.  The issue is all the visuals I listed are tools and as with any tool you need to understand when to use it.

To be effective with using visuals, you need to understand what information the group is trying to understand.  What is the purpose of the visual?  Who is the audience?  What do they need to learn from it?

Most of the time the standard visuals will be perfect.  You can use them and get everything you need.  That is why those tools are well known, because they are used all the time and work.  But sometimes, they won’t.

Don’t be afraid to make up a visual tool to present the right information in an easily digestible manner.

Here are a couple a colleague and I came up with for a recent event:

Type_of_Work_Done

This one shows the % of time people spent doing different tasks throughout the day.  It helped the group better understand who was doing what and for how long.

FreqReporting

This one shows the frequency of tasks.  Daily, Weekly or Monthly?  What was the task done on?  Who many times on that day?

In both cases, the different colored post-its represent different areas of the company doing the work.

As you can see, the standard visual tools would not have shown this information in a easy manner to understand.  We designed this for the group and it worked very well.

We can’t always rely on the tools we have and know in our toolbox.  Sometimes we have to think outside the toolbox.  It is important to understand what your customer/group is trying to accomplish and design the visual accordingly.  Don’t meet the needs of the tool.  Meet your group’s needs.

Owning a Small Business is Very Educational

crimson_hillIf 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.

An Overview of Strategy Deployment

This week is Lean series week at Beyond Lean.  The blog posts will center around strategy deployment (or Hoshin Kanri).  Justin Tomac, Chad Walters, Karen Wilhelm and Tony Ferraro will be guest blogging.  This will give you different perspectives from on strategy deployment all right here at Beyond Lean.  I am really excited for this week’s series.  All the posts are great.  Enjoy!

Almost every company will say they have a strategy.  While they may have a great strategy, most companies miss out on deploying that strategy throughout their organization.

Strategy deployment is a key concept that most companies don’t execute well.  Typically, a communication goes out stating  the strategy of the company or it may even be communicated at a large town hall.  This is great, but it is only a single step in the strategy deployment process.

A great strategy deployment process starts at the top with clearly articulated goals for the company.  The executives involve senior management in the process.  They discuss what the goals should be across all parts of the organization and how their areas can help achieve those goals.

Once that has been agreed upon, then the senior management involves the middle management.  They discuss more detailed tactics on how to the middle manager’s area can help achieve the senior manager’s goals and objectives.  It is a two-way discussion with input and clarity from both levels.

This catchball or laddering conversation should happen level by level all the way down to the floor and then all the way back up to the executives.  This should happen a few times.  Not just once.

Here is a good graphic to try and depict the process:

strategy_deployment_flow

When done well, the benefits of this are enormous.  Everyone starts to understand the strategy and how their work is helping to achieve the vision of that strategy.

The discussion that happens during the catchball phase isn’t just between a team and their manager but also between managers that are peers.  This helps to develop alignment not only up and down the organization but also across the organization.  This alignment helps determine how to use the finite pool of people and cash to best achieve the company’s goals and objectives.

In my experience, company’s that have a great strategy deployment process end up with much better results year-to-year and can sustain those results because of the clear communication and everyone understanding the importance of their work.

Does your company use strategy deployment?  How does it work?

The Answer is Easy…Better Forecasting

Image courtesy of Danilo Rizzuti / FreeDigitalPhotos.net

Image courtesy of Danilo Rizzuti / FreeDigitalPhotos.net

Have you ever sat in a meeting where the discussion is about the high (sometimes low) inventory levels?  Do you frequently hear the answer of, “Once we get our better forecasting tool in place our inventories will be better.”?

This is a strong sign the company has not fully embraced lean thinking.

A lean company would not even have a discussion where forecasting tools are the solution.  A lean company is closely connected to their customers.  The goal is to make one product when one product is bought by the customer.  I know this isn’t easy for all companies, but the discussion would be around how to move in this direction.  Not how a better forecast can be generated.

There is one thing I can guarantee about a forecast.  It is WRONG!

I have never heard anyone say, “Man, I nailed that forecast!  I hit it right on the nose!”

Don’t misunderstand me.  I do believe there is a use in looking forward and understand what is coming.  A company would like to understand if a peak or a valley of the product sales might be coming.  This can help set and adjust maximum kanban levels for that period of time.

A forecast is good to understand directionally where volumes are heading.  Forecasting is not a good basis for your entire inventory strategy.

It is a difficult mindset to change.  When you do and act on that new mindset, the dividends it pays are enormous.

Book Review: The Lean Turnaround

Art Byrne is an execute that has been implementing lean in several companies around the world.  He started our with GE and gained experience with Danaher Corp before becoming the CEO of Wiremold where their lean turnaround is featured in the book “Better Thinking, Better Results“.  Since leaving Wiremold Art has used lean to turnaround companies as a partner with J.W. Childs Associates.  Art brings his vast experience to the readers.

Lean_Turnaround_CoverName of the Book:  The Lean Turnaround: How Business Leaders Use Lean Principles to Create Value and Transform Their Company

Author: Art Byrne

Publication Date:  2012

Book description: what’s the key message?

Art really drives home the message about a company can only be truly lean if the leaders are setting an example and leading the way.  A lean executive does not dictate what others need to go do.  A lean executive does it himself.

Also, the executives have to transform the people.  Get everyone to buy-in from the shop floor to the executive suite.  There is no room for people that won’t buy-in.  In order to do this, as the leader you need to engage in the change and lead it.  Not support it.

Art lays out his principles to follow to becoming lean:

  • Work to Takt Time
  • Create one piece flow
  • Utilized Standard Work
  • Connect Customers to Work by Using a Pull System

What are the highlights? What works?

Art does a fantastic job of giving multiple examples of how he engaged employees and led the change even as a CEO.  This brings to life how it can be done and the thought isn’t some dream a consultant made up.

I really like how Art lays out obstacles to achieving his lean principles.  Accounting and standard costing is the biggest obstacle because it can show a negative result or cause bad decisions when doing things that are helping.  He then explains the changes that are needed and gives examples of the changes and how the finances would look different.

There are more examples of other metrics that Art recommends for a lean company.

Another powerful section of the book is how he used lean to grow businesses and profits even during tough economic times. Art even lays out a strategy for looking at companies when thinking about acquisitions.

The real life examples as a CEO and board member of companies really drives how a lean turnaround can be achieved.  A CEO must do a 180 from the traditional methods to do it and a leap of faith will be needed, but the reward is very high.

What are the weaknesses?  What’s missing?

This is a really good book, but I do see one thing missing.  Art speaks from a CEO or executive viewpoint, which is great, but what if you aren’t an executive?

One question I would like to see answered is how do lower level employees help executives want to do a lean turnaround?  Sure, one answer could be give them the book, but that probably won’t change everyone’s mind with just a single read.  How do you help an executive that seems to want to do it, do it?  Give them that final push and really start to see the benefits?

The book can also give the feeling that if you don’t have an executive leading and doing everything in the book then you might as well not go through with lean because you won’t be successful.  Art does not say that explicitly.  The book just gives that feeling.

How should I read this to get the most out of it?

I recommend this book for anyone but especially high level level executive or CEO.  Art lays out a great game plan and a compelling case for the executives to transform their work and create a lean turnaround.  Read the book straight through and then re-read it as you develop a plan to change your company.

I would also recommend it for more Wallstreet and finance people.  It would enlighten them on how to look at companies that deliver long term value to their customers.  Not just short term gains.

H&H Color Lab – American Company Growing Through Lean

HHLogoH&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