Posted by: productivityinc | May 29, 2014

Decentralization: The Future “What” and “How”

blog photoThe decentralization of manufacturing, of services, and of innovation processes is happening or at least on the horizon all around us, with great potential to disrupt major industries. It’s a revolution powered by digital technology. In the latest issue of the Strategic Innovation Newsletter, we take a look at three non-manufacturing organizations, all of which are reaching their fifth anniversaries. They provide instructive examples of decentralized approaches that have led to rapid growth.

 

Read the full article by clicking here

See the entire issue by clicking here

Posted by: productivityinc | October 14, 2013

Lean Lessons At the Movies

Blog10-14Quoting movie dialog is a big thing in my family.  I am not sure how it started, but we do it often.  Last week at a SMED training session, an attendee was reeling off movie lines to his team members.  As you might imagine, I liked him immediately!  We had a great week of learning, improving and talking movies.  It occurred to me that many famous movie lines can be tied to Lean lessons.  Here are just a few I’ve connected…

  • “Frankly my dear, I don’t give a damn.”  You will get some resistance along the way…don’t be discouraged, this is perfectly normal.  Educate people about the effort and how it will affect them.  Encourage involvement and ideas from everyone.
  • “Fasten your seatbelts; it’s going to be a bumpy night.”  Don’t expect to get it 100% right the first time.  Change is never an easy process.  Don’t be afraid to experiment.  Celebrate the wins and learn from the misses.
  • “What we’ve got here is a failure to communicate.”  Communication is the key to making progress and sustaining.  Communicate, communicate, communicate!
  • “Show me the money.”  Make a business case for all proposed improvement events and quantify all event outcomes.  Articulating a business case will help ensure your efforts are tied to organizational goals and monetizing your improvement results will help others see the return on the investment and ease the way for future projects.
  • “You can’t handle the truth.”  Our production processes don’t lie…they convey the health of production all day, every day.  Is your production exceeding demand, or falling short?  What’s causing the disparity?   Lean is data-driven.  Study your production process to reveal truths about your operation.  Never assume you know what the issues are. Get out in the workplace, study the process, and uncover the real truth – it just might set you free!
  • “Houston, we have a problem.”  And that’s a good thing because problems provide opportunities for improvement.  A continuous improvement environment is problematic.  Arm your value-adders with an easy-to-use problem-solving technique so problems don’t impede their improvement progress.

Please send in your favorite movie quotes and the lean lessons they support.  And, we welcome news on your implementation progress. We are always excited to hear what you are working on, succeeding at, or tripping over.  (Sometimes I think we learn more from tripping than from anything else!)  Keep an eye out for our next post…“I’ll be back”…soon!

Maureen C. Fahey, Managing Partner – mfahey@productivityinc.com

“Frankly my dear, I don’t give a damn.” Gone with the Wind1939 David O. Selznick film * “Fasten your seatbelts.  It’s going to be a bumpy night.” All About  Eve 1950 Darryl F. Zanuck film. * “What we’ve got here is a failure to communicate.”  Cool Hand Luke  1967 Gordon Carroll film. * “Show me the money.” Jerry Maguire 1996 Cameron Crowe, James L. Brooks, Laurence Mark, Richard Sakai film. * ”You can’t handle the truth.” A Few Good Men 1992 David Brown, Rob Reiner, Andrew Sheinman film.  * “Houston, we have a problem.”  Apollo 13 1995 Brian Grazer film. 

 

Posted by: productivityinc | September 23, 2013

The Improvement Strategy “Trinity”

Blog 9-19 photoIn a memorable scene from the movie “Raiders of the Lost Ark,” one of the bad guys challenges Indiana Jones to a sword fight. As the challenger brandishes his sword in preparation for battle, Indiana sizes him up for a moment, then just pulls out his gun and shoots him. Duel over.

I was reminded of this scene the other day as I sat listening to a CEO recount the steps and missteps of his organization’s lean journey. He outlined the early stages, in which they concentrated on training everyone in lean techniques, the evolution to a singular focus on rapid improvement events, and his eventual realization that they needed more than an events-focused strategy to achieve their goals. Because he ultimately understood that developing a lean culture would require changing daily behaviors, his organization’s employees are living lean every day as part of their normal work.

Becoming a Lean Company—The Improvement Strategy “Trinity”

During this CEO’s presentation, an audience member asked if he regretted the “wasted” years. His reply: “I don’t view those years as wasted because we have incorporated all of the tools and training into our initiative today. If I could go back and do it again, the only thing I’d change is the order in which we introduced them.”

What separates the good from the great is the understanding that without all three of these elements working in tandem, lean success is elusive.

1. Developing a Lean Culture – Like the CEO above, we believe that developing an improvement culture is the key to achieving success. We invite our clients to think of it in terms of developing a culture of servant leadership, in which leaders at all levels spend the majority of their time serving the individuals that create customer value – the value adders. There are several routines associated with doing this:

  • Teaching and coaching
  • Experimenting with low-cost or no-cost improvement ideas
  • Helping value adders adhere to standard work
  • Collaborating with value adders in problem solving

This is the most difficult component of your improvement strategy, as individuals up, down, and across the organization work to change the way they’ve managed for their entire careers. Fortunately, people development can be done in tandem with other elements in your strategy.

2. Tools Training – We strongly advocate education at all levels in a lean environment. In order for all associates to take part in improvement activities, they must have at least a basic understanding of the foundational techniques and how to apply them. The more time you invest in training, the better-armed employees are to drive change in their own areas (what we call bottom-up improvement), and the stronger your overall results.

3. The Improvement Event – We are also big proponents of the rapid improvement or kaizen event; in fact, we introduced the format to the U.S. back in the 1980’s. Over the years, though, many have come to use kaizen events as their sole improvement method. While the kaizen event should be a part of your strategy, we advise clients to be sure events are strategically focused and linked so that they directly tie in to organizational goals. And in order to sustain and replicate the gains from events, the servant leadership culture must be firmly in place.

Lean culture, trained associates, and strategic kaizen events: these three elements, working in tandem, provide the environment for the perfect improvement machine. Take a look at your own lean initiative. Does it incorporate all three elements? Are you being led down the tools or kaizen path? Fighting for improvement using a lean strategy that’s missing any of these elements is like bringing a sword to a gun battle. Before you know it, it’s game over.

How are you doing? Use this simple diagnosis to see where you are.

  Level 1 Level 2 Level 3
Culture Operators serve management The elements of a lean culture are generally understood, but have not been operationally instituted Leaders at all levels understand and practice servant leadership routines
Tools Training No structured use of lean tools/techniques A cadre of lean tool experts has been developed A broad collection of lean techniques has been internalized by all associates
Improvement Events Events are held at random without connection to strategy; gains not always sustained and never replicated Events are loosely tied to organizational strategy; gains are typically sustained but not replicated Events are strategic in nature and linked; gains achieved are always sustained and easily replicated to other areas/facilities

 

If you’d like to talk more about the strategy “Trinity” or any aspect of your lean initiative, please drop me an e-mail.  I’d appreciate the opportunity to share perspectives.

Michael J. Kuta, Managing Partner – mkuta@productivityinc.com

 

Posted by: productivityinc | August 7, 2013

The Offshoring, Reshoring, Right-shoring Shuffle

BlogpostReshoring is trending up, according to some studies, as companies in the U.S., U.K., and other Western countries take a fresh look at sourcing strategies in the wake of the global recession. Why? There are lots of reasons, including company reputation concerns, political and marketing advantages, increasing labor costs overseas, and the risks of everything from labor unrest and natural disasters, to safety and quality problems and IP protection.

Boiling it down to a few key points, the top six drivers for reshoring (according to a recent MIT study) are:

  1. Time to market
  2. Cost reduction
  3. Product quality
  4. More control
  5. Hidden supply chain management costs
  6. IP protection

We’d further condense that to one key question: What gives your company long-term competitive advantage? To answer that, you have to get beyond short-term, unit-cost considerations and look at three key factors: total cost, total risk, and customer value.

Find out more, and get a link to a useful decision-making tool in the feature article of the latest Operational Excellence newsletter.

Posted by: productivityinc | June 21, 2013

Invest for Success

I shared this experience with some of my contacts earlier this week, but wanted to post it here as well as it might be of use to some of our readers.blogpost

At one of my engagements, I got into a conversation with a VP of Operations who asked “Ellis, what’s the #1 thing we should do to be sure our improvement effort gets off on the right foot?”  Well, I don’t believe there’s only one…here are 3 fundamental elements that I gave him to consider for true, long-term success:

  1. Learning – Help employees to gain an understanding of the fundamental principles of Lean and TPM.  This will give them the knowledge base and understanding they need to not only feel a part of the effort, but to contribute as well.  Put together a plan to educate everyone; it will pay dividends long into the future.
  2. Building Capabilities – Leverage natural working teams and give them the freedom to experiment.  We call this ‘bottom-up’ improvement, improvement that happens every day outside of a formal kaizen event.  Be sure to arm your teams with a good problem solving tool (one based in scientific method) allowing them to get to root cause.
  3. Establishing Standard Work – Developing a systemic process to ensure continuous improvement of best practices is a must.  Most all companies have standards; I find few that keep them current and actually adhere to them consistently.  Setting and adhering to standards gives you a baseline from which to improve and a means to measure your improvement success.

If I were forced to boil it down to just one thing, I’d have to say “invest”.  Invest the time and resources needed to set a solid foundation.

Ellis New, Senior Management Consultant – enew@productivityinc.com

Posted by: productivityinc | May 31, 2013

Can you solve the same problem twice?

 

Recently I was working with a project team looking at machine data for a key piece of equipment.  The data showed the machine had several sporadic losses in that particular week.   To dig deeper into the data, we spoke to the operators and maintenance staff; one seasoned associate told us, “Oh, I know what caused that loss, we’ve had to fix that a few times.”

Back in the training room, I asked the project team, “Can you solve the same problem twice?” I contend that you can’t. If you truly solve a problem the first time, it won’t recur.

Developing a ‘Community of Scientists’

Toyota refers to their process owners as a “community of scientists.” They’ve blurred the line between how operators do their work and how they improve. Developing a problem-solving capability and arming problem solvers with a scientific method for getting to root cause will eliminate many of the small problems that negatively affect quality, safety and reliability (both process and equipment) each day.

Follow the Facts

Some problems can’t be solved by process owners in the course of their work, but instead require the concerted effort of a cross functional team.  Teams must also follow a scientific problem-solving method. But unlike process owners who solve problems locally, the team can investigate across functional boundaries and shifts and even the supply base. It is especially important to follow the facts, and always be prepared to rewrite the original problem statement as the facts narrow the scope of investigation.  For example, if you are looking at a rash of sporadic losses (as the team and I were a few weeks ago) and the facts point to a problem with “material,” you will need to rewrite your problem statement to focus on the material issue.  Then begin the problem-solving process anew.  Remember, the end goal is root cause…so be prepared to track the problem into your supply base if the facts lead you there.  (Just because it is a “material’ issue,” it isn’t just your supplier’s problem to fix!)

There are many problem-solving methods you can use including the 5 Whys, CEDAC (cause and effect diagram with the addition of cards), A3, 6M, DMAIC, etc.  It is best to teach process owners a simple method that is easy to use and understand…5 Whys, CEDAC or A3 work best at this level.  For more complex problems, 6M and DMAIC are better choices.CEDAC 3-day 021808 [Read-Only] [Compatibility Mode]

Regardless of which method you employ…having a problem-solving capability in your organization will serve you well. For one thing, quality, safety, and equipment/process reliability will improve. Correcting a problem at the root cause when it first appears will also save you money.   When a process “plans its own downtime” (i.e. breaks down) it will cost you 10 times more in time and money to get the process running again. Problems are opportunities to improve and grow. Invest the time and energy in correctly correcting problems when they first occur and you’ll never have to solve the same problem twice.

I have a challenge for you…take a look around your facility and see how many ‘work-arounds’ have become embedded in standard operating procedures. How many “hopper boppers” or “fix-it gadgets” can you find? (I am confident you all know what these are and may have even used them yourself; if not, give me a call and I’ll explain.)   Each one of the homemade tools you find are a direct ”fix” to a problem that no one has yet taken the time to correct.  You can begin your problem-solving effort right there.

If you need assistance or have any questions please feel free to make contact.  You can reach me at the e-mail below.

Ellis New, Senior Management Consultant – enew@productivityinc.com

Posted by: productivityinc | May 15, 2013

Beyond the Improvement Strategy

Recently I was invited to help a metal manufacturer with two business units and several production facilities address the issue of their continued under-performance; despite what the company felt was a herculean effort to drive cost from their system.

During the meeting they explained their issues and outlined the improvement initiatives they had in place.  They wanted my help in closing the gap between the results they were getting and the results that were needed.

As I listened to the leadership team’s plan for moving forward it became immediately clear to me that the problem they were trying to solve could not be solved with a bottom line improvement focus…yet this was where everyone’s thinking was centered.

I was reminded that day that many of us are “victims” of the Lean era.  For decades we have been working to improve our existing forms of value by driving waste from our systems.  It is the practice we all know and since we’ve seen the results that can be achieved it is the first, and in many cases, the only option that is explored.  Yet, some problems can’t be solved with a focus exclusively on the bottom line.    Some issues require a top line focus.

Top line growth, what we call Strategic Innovation, has its own well developed framework, tools and techniques for growing organizational profitability.  (To learn more about Strategic Innovation, visit our website at http://www.productivityinc.com/innovation/)

For the metals manufacturer noted above, the method that best fit their need was Business Model Innovation.  Business Model Innovation involves a collaborative process that visually renders the current business strategy, identifies new strategic positions, uncovers an innovative future state strategy, and defines the future state business model. The process of implementing Business Model Innovation involves carefully reviewing all nine building blocks of the business model… not just products and services, for the opportunity to leverage innovation. The illustration below shows what all the elements of the business model are and how they link to form the new value creation capability.  (Click on image to enlarge it.)

14 Business Model Design [Compatibility Mode]

Arriving at a clear conception of your present business model—one that’s shared by top-level executives and managers—is an important step in identifying opportunities for innovation. The act of simply bringing the existing model to light can spur ideas about new ways of going about your business that go beyond waste elimination.  It can help you see opportunities for disruption that you (or your competitors) can leverage or in the case of the metal manufacturer, it can help you see ways to return to profitability.

If you’re struggling with an issue and want to see of Strategic Innovation might hold the answer, or just want to learn more about SI, send me a note.    James Vatalaro, Senior Management Consultant    

Posted by: productivityinc | April 30, 2013

6 Actions to Help Mid-Level Managers Transition into Lean Leaders

leanlWhy do so many companies do lean things, but struggle to become a truly lean company? The answer lies with the reluctance of mid-level management to adopt the improvement mindset. Most top-level managers we know do understand lean and the impact it can have.  And while we aren’t always satisfied with the level of involvement coming from the top, we find they generally do support efforts and provide the resources needed to make things happen.

At the opposite end of the hierarchy, associates on the front lines will typically give lean a chance, and often become supporters when they see how lean techniques have a positive impact on their job—how lean makes their workplace safer and their work process easier.  As long as your front line associates clearly understand the organization’s improvement goals and their role in them, you will have a cadre of lean supporters.

Mid-level management poses a special challenge. These individuals are often the most threatened by the changes lean transformation brings to the company and their jobs.  They are the ones who often feel as if they are losing control and giving up authority to people lower in the organization.

Organizations with support from the top and participation on the floor should focus energy on bridging the gap in the middle.  Failure to recognize and address the issues in the middle will hinder or halt your progress and ensure you remain a company that does lean things rather than becoming a lean company.

Here are 6 actions that will help your mid-level managers make a successful transition:

1. Articulate the vision for them – like your front-line associates, your mid-level managers need to have a clear understanding of the company’s vision and their role in it.  Be open about the fact that the transition will be difficult at times and reinforce the reasons this change will benefit the entire organization.

2. Give them the theory – provide them with a ‘framework’ for the way their new role should function but let them fill in the details – “the how’s”.

3. Demonstrate for them – lead by example.  As a top-level leader, your role is changing too.  Demonstrate the behaviors you expect others to exhibit.

4. Let them apply – give them the freedom and space to experiment.  There is a learning curve associated with learning and perfecting lean leadership skills.  What is most important is that they understand you are serious about the new leadership expectations (that this is not just a ‘program of the month’) and they are truly making the effort to adapt.

5. Let them reflect – changing behavior is a process, it won’t happen overnight and you can count on having both good and bad days.  Provide a structured time for your managers to reflect on what is going well and what isn’t.  Learning a new way to work will not always be comfortable, providing time to reflect will limit frustrations and keep the process on track.

6. Give them feedback – providing “pats on the back” and constructive comments  will ensure your managers know that you are taking notice of the effort they are making.

If you’d like to talk more about developing coaching and leadership routines (also known as kata) reach out; teachers teaching teachers is a topic I am very passionate about.  I’d love to hear your perspective.

Jim Vatalaro, Sr. Management Consultant – jvatalaro@productivityinc.com

Posted by: productivityinc | April 4, 2013

The Big Miss·take

BPBMThe ‘big miss’ in golf terms refers to a bad golf shot, one from which the player cannot recover par.  I was reminded the other day about another type of ‘big miss’, this one occurs in the workplace rather than on a golf course.

It takes a lot of hard work for a lean team and the folks on the floor to gain momentum in their journey to improve.  Setbacks and struggles often occur causing the progress to be slower than anticipated, but in most environments, this is not out of the ordinary.  In any improvement or change process there are four stages a team must pass though in order to be successful – (1) Form, (2) Storm, (3) Norm, (4) Perform – and this process takes time.

As the organization and teams move through these stages, many make the same mistake when they reach the Norm stage.  From my experience, once an organization has moved through the Forming and has begun to come out of the Storming stage there is a tendency to slow down; as everyone is so happy not to be Storming that the entire organization, as well as departments and small teams, want to enjoy the peace and quiet of the Norm stage.

Slowing down at this stage is a big mistake –the ‘big miss’ if you will.  If a slowdown is allowed to happen, the gains of the past will be lost. Once you’ve done the hard work to move out of the Storming stage don’t rest.

Your job as the leadership of this process is to push individuals, teams and the organization through this Norm stage and into the Perform stage. There will always be reasons and issues that crop up that make it easy not to move forward in the learning and implementation of lean. Be aware of those feelings and desires to rest, and instead push-on with steadfastness and determination.  Avoiding the ‘big miss’, a mistake from which your program might not recover, is the essence of true leadership.

If you’d like to chat about keeping your improvement program moving forward, give me a call.  I’d also be open to a discussion about your golf game!!

Eric Whitley, Senior Management Consultant – ewhitley@productivityinc.com

Posted by: productivityinc | March 29, 2013

When it comes to Innovation – Think Big

We often hear concerns from smaller organizations that employing an innovation strategy is something only a larger enterprise can pull off.  You will be surprised to learn that based on our experience, being a smaller enterprise is actually an advantage when it comes to building an organization-wide innovation capability. Why? Smaller means faster and more nimble.

The process and core elements remain the same…collaborating closely with you and your team in establishing your organization’s Innovation Vision, Strategy, Business Case, Sponsorship and new value-driving processes.

Inovbp3We would argue that establishing a top-line growth or innovation strategy is even more important for the small to medium sized company than it is for the larger organization.  Smaller enterprises are usually less diversified and have fewer value propositions than their larger competitors.  This makes them more susceptible to market disruptions and when the disruptions come, they are felt faster and more significantly.

In the world of innovation, size doesn’t matter.  What matters most is that you become a market disruptor instead of the disrupted!

If you are interested in learning more about Strategic Innovation, click here to sign up to receive our free newsletter.

If you’d like to talk more on the subject of Strategic Innovation, get in touch.

Maureen C. Fahey, Managing Partner – mfahey@productivityinc.com

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