Dec 24, 2010

Santa's KPIs


If Santa had a KPI dashboard, what metrics would he be watching?

Some answers from friends on Twitter:
@jorgekravitz - leadtime get gift

@awille - ratio of good to naughty, trended against last CY and target :-)

@ stevenleuschel - For his N pole fctry: safety, quality, productivity, human dvlpt and cost. What would this mean specifically? hmmm....

@qualiahr - Santa wouldn't have an KPI dashboard because he is good :)
Santa does have GPS and logistics monitoring -- 

Track Santa's progress on Google maps or on Google Earth. Follow Santa on Twitter at @noradsanta. Shopping? Search "santa" on you mobile phone's Google maps app. Thanks NORAD!

AND...
-Are there feeder sleighs for rapid resupply?

-Flexible factory for last-minute changes to mix?

-Is there a process for missed deliveries?

-Does he take cookies home to gain-share with the workforce?

-Has Santa ever applied for a Shingo Prize or Baldrige Award?

If anyone has made a site visit and can answer these questions, we want to hear from you!

Dec 20, 2010

Toyota Europe acts on corporate safety strategy

My last post, Toyota's workplace safety philosophy is part of sustainability, and this one will look at how that plays out in Europe.

In 2010, Toyota Motor Europe created a Safety Promotion Committee made up of representatives from senior management that will set direction on safety throughout European operations.

Safety improvements are made at other workplaces besides factories. For instance, parts centers, logistics, and offices had their share of improvements.

In the parts centers, the global strategy to reduce STOP 6 accidents (see the previous post) resulted in a significant improvement. New STOP 6 risk assessment tools and check sheets revealed improvements that reduced risk. There was also a focus on separating human work and machine work, avoiding falls from heights, and developing a safety awareness plan.

Formula: No of LTI/ Work hours x 1,000,000
Note: TPCE included

The vehicle logistics group worked with rail partners to prevent falls during rail transport. People must be able to get on the top of the rail transport units, but fixed safety barriers would not fit under bridges. Working with our rail logistics partners, the vehicle logistics team came up with a system of adjustable barriers.


Adjustable barriers fixed to rail carriages
 
Facilities including offices, garages, workshops, and laboratories in Brussels and Zaventem, Belgium established a system for risk assessment system of chemical products from purchase to disposal.

Manufacturing
In FY09 there was improvement in Toyota Europe’s Lost Time Injury (LTI) rate. (Ergonomic injuries are now reported separately.)


    * Toyota Peugeot Citroën Automobile data integrated from FY07
    * Ergonomic injuries are reported separately from FY09, previously they were integrated into these statistics.
    * Formula: No. of LTI/ Work hours x 1,000,000

Throughout the European organization, an Ergonomics Working Group (EWG) of safety specialists share best practices, working with the Safety Working Group.

UK

Daily pre-shift meetings make safety the first agenda item. Depending on their jobs, people go through some physical exercises to warm up and avoid injury. In addition safety checks are carried out on equipment.

The attention is on safe processes and equipment, safety kaizen, and training and confirmation. To help employees develop a “safety mind,” hazard awareness training is provided. Near miss reporting also triggers safety interventions. Following genchi-genbutsu -- go, look and study -- senior management can spot safety related issues and raise awareness of health and safety issues.

The number of lost time accidents and incidents of muscular skeletal symptoms (MSS) at UK manufacturing plants has been going down:
Turkey
Using the Plan-Do-Check-Act cycle approach, Toyota Motor Manufacturing Turkey’s (TMMT) started production of the new Auris with extra improvements.
Poland
The importance of employee communication in identifying and reducing risks was the focus of Toyota Motor Industries Poland (TMIP)'s annual safety month. They even stopped production to find improvements. So far, more than 80% of improvement points have been addressed. Reportedly, 70% of employees said they would like to do it again. A more robust system for employee safety suggestions is in the works.

Overview of line stop activity at TMIP

Toyota's strategy of having each workplace drive improved safety, described in my previous post, can be seen in the differing details of safety improvement in Europe. The overall goal for each is zero accidents and injuries.

Sources:
Toyota Motor Europe Sustainability

Toyota Motor UK About us: Our people best in class
Toyota Motor Manufacturing UK, Workplace, Global Vision 2010, Respect for all people 

Dec 16, 2010

Toyota's workplace safety philosophy is part of sustainability

As everyone knows, Toyota's been hard at work reducing vehicle safety risks, but it has also continued to emphasize safety improvement in its workplaces.

“Safe work is ‘the door’ to all work. Let us pass through this door,” Eiji Toyoda was quoted as saying in the 2010 Toyota Corporate Sustainability Report (CSR). The report stresses that Toyota’s fundamental belief is that safety is essential for sustaining and developing the company, and that placing safety first is everyone's responsibility, from senior executives to every employee at the workplace. To Toyota it is a universal value that is “unaffected by the times.” Furthermore, Toyota believes that no employee or team member should be put at risk of suffering a work-related accident.


Safety and Health Culture - Toyota Sustainability Report 2010


Beginning in FY2008, the approach has been “building a culture that enables all employees/team members to think for themselves and practice safety and health.” Each workplace is to be a driving force behind a company-wide effort.

The three pillars of this approach are: 


1. Improving the system for an “independent” or “interdependent” type safety culture where the workplace takes initiative for safety and health and promotes relevant activities, 


2. Promoting the Occupational Safety and Health Management System (OSHMS) continuously and thoroughly and 

3. Creating a structure for global implementation.

Through this workplace-driven approach, total accidents decreased by about 16% over the previous year, the number of lost workday cases decreased by 35%, and the number of STOP6-type accidents decreased by 14%.
 

STOP6 accidents:
  • Being caught in a machine,
  • Collision with a heavy object,
  • Collision with a vehicle,
  • Falls,
  • Electric shocks, and
  • Contact with a heated object
Its Occupational Safety and Health Management System (OSHMS) promotes safety and health activities. Emphasis on basic rule observance and interdependent bottom-up initiatives involving the whole company will be implemented in FY 2010. 
Toyota Occupational Safety and Health Management System (OSHMS)

The aim is that when all employees understand the benefits of an interdependent safety culture, they will make progress toward achieving and maintaining zero industrial accidents at each workplace.






Sources: Toyota Employee Relations
Corporate Sustainability Report (download PDF from this page)

Nov 23, 2010

Getting social at the AME Conference

Time to reflect on the AME conference last week. Here are a few social media musings:

Twitter: Tweeting was fun and produced some relationships that I hope continue into the future. Maybe that’s enough. AME is an audience that doesn’t twitter much, so I’m going to watch closely through the year and into the next conference before concluding it’s a trivial pursuit. @AuburnNate became a new AMEConnect twitter friend, and is convinced that twitter has untapped power for us, and he graciously agreed to join the council. You can follow @AuburnNate, @AMEConnect, and many other cool folks by searching for #AMEConf2010, and start watching for #AMEConf2011. Use the hashtag for ideas if you have them.

LinkedIn: We had about twice the usual number of new members join the Association for Manufacturing Excellence LinkedIn group. Hope they like what they find and jump in. Next year it would be nice to have more discussion questions emerge from conference sessions.

Facebook: I’m not sure about Facebook’s role in a professional organization, but I’m a Facebook Neanderthal, so what do I know? We had a few picture postings, and might have had more if I had practiced using my new smarter-than-me phone. (Note to self…kata makes perfect.) Seems to me like the AMEConnect Facebook page is a good way to share the fun and elation we pick up every year at the conference, and we did have some comments and likes from our 135 friends.

Social media in other organizations:

One person I talked to was my friend Jim Garrick, who told me that Fedex employees were getting a lot of encouragement to twitter and otherwise shout out to other Fedex employees AND customers. It sounded unusual for such an operations-oriented company and I’m dying to know more. Oddly, it was hard to find social media on the Fedex website - I ended up on the press pages. Fedex Citizenship blog Fedex on Twitter

Kevin Meyer’s Specialty Silicones is a source for his Evolving Excellence blog. He had tweeted to me that he sent five people, and I managed to meet four of them. That included Standup Cy, who fabricated the standup desk Kevin blogged about a while ago. He’s become a social media celebrity since then.

Old-fashioned in-person social networking:
Social Networking Café: Bob Hafey set up a cookies and milk reception on early check-in night for social media denizens, though most of the people showed up because they saw the word “networking” on the sign Bob had set up in the registration area. Which was fine. People looked like they were having fun, and I met folks from Uganda, England, the Lehigh Valley in PA and down the road to the Eastern Shore in MD. Next year I’d like to have a couple more gatherings. In the bag given to people attending, there was a very nice brochure announcing the Café, with other social media tips for the conference. I don’t know about you, but I don’t pay much attention to those brochures.

Not our table, but could have been
Some rights reserved by veni markovski
Meetups: We tried getting twitter followers together in the Baltimore “Dine-Around” but there were only two new guys who came for that reason.  I also tweeted an “I’m here” at breakfast on Thursday to see what would happen. @Auburnate appeared as I was chatting with a chance table-mate from Chicago. Then @MartinGHerrera from MI-Swaco in Argentina appeared. We had been trying to get together since he first started following and using our hashtag before the conference. Martin, Nate, and John quickly began to discuss how to spread lean in their companies and each went away with a new thought and new friend. Did we need Twitter to accomplish that? Maybe not, but it broke the ice. And that’s where Nate shared his enthusiasm for social media and ideas for what to do next year. Can’t wait to hear more about them.

Sessions: We had 20+ people in each of our sessions on social media/networking, which I thought was amazing considering the topics and speakers in sessions competing with us. More people were interested in marketing aspects of social media than I expected. I still think that we should focus on social media as a support to lean journeys, but next year maybe we should add a social media marketing session. We had great questions from the group. Should we try to do some webinars?

Presentation: Collaborating with AME’s Social Media Council members Jason Semovoski and Ashley DeVecht produced a much better presentation than I would have produced on my own. Wonder if they feel the same way. Regardless, you can find “getting started with social media” and “  “ in the AMEConnect SlideShare space.

Home base: We didn’t really have a spot for people to find each other. It was like Goldilocks and the Three Bears. The too-big-and-busy booth for next year’s Dallas Conference wasn’t the right place, and the little table with AME brochures on it wasn’t prominent enough. Maybe next year we will have a space that’s just right. And tables at mealtime with visible signage. Nate thinks we can fill at least three.

That’s the social media roundup. There was also a lot to learn about lean and continuous improvement in many industries and functions, the real reason why people take a week out of their lives to go. Many say that the AME annual conference is the best place to learn and get charged up. Follow us at #AMEConf2011. The website is http://www.ameconference.org/. Tip -- everything about the Baltimore conference is in red. Everything about next year’s Dallas conference is in blue.

Nov 19, 2010

Healthcare facility, little consideration for people with disabilities

My 84 year old mother told me a story this morning. She had been to the clinic to get a vascular evaluation and had to make a six-month follow up appointment. In front of her line was a man in a wheelchair who was missing a leg. He and couldn't get close enough to the window behind which the hospital employee was speaking to him. They were having trouble hearing each other. The problem was made more difficult because of the glass security barrier at the window.

Mom stepped up and started relaying messages between the woman employee and the man. He needed an X-ray and asked if he could just have it then while he was at the clinic. It was difficult for him to get to the hospital. The woman asked how much time he had. Only an hour, because the special public transportation service made fixed appointments to pick up disabled passengers. That's not enough time, she told him. Mom says she could see his fatigue, and at her age, knew exactly how that felt. Finally, with mom's help, he made the appointment for the X-ray.

Then he asked how to get out of the office. The door was not wheelchair accessible, so mom went and helped him through it. Mom went back and the woman thanked her for helping. It turned out that she often had trouble hearing patients because she wore hearing aids. She wasn't allowed to make exceptions in scheduling, and the workstation didn't permit her to move closer to the man. She felt bad that there was nothing she could have done to make things easier for him.

After she made her appointment she left the office, and the man was still there, so she started to chat with him. He was a veteran, he said, but didn't say more.  He told her there are people where he lives who have problems like his, and that's just their life. They mostly accepted it.

While the state provides free transportation for them, they have to make arrangements the day before and must be picked up at specific times. Sometimes there are not enough busses when needed. She asked how he let the transportation service know he was finished at the hospital, and he pointed to the valet. Mom wasn't so sure about how that would work so went over and asked the valet if he had called. Fortunately, he was able to assure her that he had called for the bus and he would see that the man got his ride.

Mom had to recognize that she needed to place limits on how involved she got with people who needed help, so she made herself disengage and went home. She explained that her propensity for helping -- and I could tell you a dozen stories of other things like that she has done -- came from her family's life as homesteaders on the Nebraska prairie, where every farmer kept an extra straw mattress for someone traveling and needing a bed for the night. They helped each other at butchering time and haying time. They took turns boarding the teacher of the one-room school they had built. They all made it through the Great Depression.

How have we lost the ethic of hospitality and mutual help? How did the designers and managers of the appointment desk fail to consider the special needs of patients and employees? How did the hospital fail to have someone on hand to support people in such a situation? Is there always a prairie-reared woman in line to handle the problem?

How many ways can you think of that the clinic could have prevented the distress that these three people experienced that day?

Nov 11, 2010

Bits and pieces from the WIP file

Here's a quick list of what's been inspiring me lately:

The Lean Nation
Congratulations to Karl Wadensten and Linda Kleineberg on the one-year anniversary of The Lean Nation on radio 790 AM in Providence RI. Every day Karl interviews lean leaders from his informal and hands-on perspective. Karl has not only led an impressive lean journey at his own company, VIBCO, but has brought company presidents, politicians, and all types of folks into VIBCO events to see lean in action. Karl will be broadcasting the show from the AME Conference in Baltimore November 16,17, and 18th, plus telling his story on Wednesday, Nov 17, at 10:30.

On their anniversary show, Karl and Linda said that what surprised them both about taking a chunk of their time every day to do the broadcast is how much they learned by engaging with their guests and their call-in listeners. If you can't listen in, there are a number of podcasts on the Lean Nation website. Also check out K-Dubs Lean Nation Radio Show on Facebook.



Toyota Kata


Mike Rother
I bought the book when it first came out but only skimmed it. Then I had the chance to meet its author, Mike Rother, at the IQPC Process Excellence Leaders meeting in Chicago in September, and to be part of the audience for his keynote address. My friend Mark Rosenthal called it the best book on Toyota in -- did he say a long time, or in all time? Regardless, it's one of those books that takes several readings to begin to get the depth of what a "kata" is at Toyota and why it is at the heart of an organization focused on long term survival and the development of capable employees. Mike also is publishing a website that enlarges the book's message and places the ideas in varying contexts. I think the website is essential for getting Mike's full message.
Mike is conducting courses and workshops on Toyota Kata. He and Bill Constantino will do a workshop at the AME Conference Nov 15.  


The Remedy


Pascal Dennis
In The Remedy, Pascal Dennis continues his story begun in Andy and Me of Tom Papas and his lean journey at a fictional auto manufacturer. Now Tom has been asked to fill the role of Shusa (roughly translated as "chief engineer") for a new vehicle. In this role, Tom seeks to connect the silos of design, manufacturing, supply chain, and so on. He fights the battles most of you are completely familiar with. Being fictional characters, Tom and his crew prevail.

The book covers a broad scope thinly, where it would take 10 - 15 excellent books to explain properly. That's its value and drawback. Overall, it's a good introduction to beginning to spread lean thinking in the extended enterprise. It's not enough, but I think Pascal knows that it's just starting lines of thinking that can be continued through reading his carefully chosen references at the end.

It resonates with Toyota Kata in many ways, particularly in the principles of solving small problems continuously by building capability into the people in the organization, articulated well by Steven Spear in The High Velocity Edge (a better title than the earlier one - Chasing the Rabbit - read my review.) The three books read together would be an education right there.


Escape the Improvement Trap

This new book by Michael Bremer and Brian McKibben is a fresh look at what happens in the real world, where most organizations that try to implement some "transformational" method eventually get stuck and call it a failure. The missing "ingredients," described in Escape the Improvement Trap are customer focus, engaged people, key metrics, process thinking, and executive mindset. "I know THAT," you say. And you do. Except that you probably can't explain how to supply those ingredients in as clear and useful a way as the authors do. The book uses a combination of the fictional company and case examples of real companies to illustrate what they see as the way to avoid getting stuck in an improvement process that doesn't go anywhere.

Michael Bremer
They also do a good job with diagrams and worksheets. The one they keep returning to is a statistical "improvement maturity" curve of companies. Michael and Brian say that most leaders overestimate their stage of excellence and provide a quick estimator tool.
Michael will also be conducting a workshop on the five ingredients at the AME conference on Nov 15.


I apologize to everyone for giving short shrift to their work. Maybe readers can round out my comments with their own.

Oct 14, 2010

Book review - Target Cost Management: The ladder to global survival and success

by Jim Rains

This book disappointed me greatly. The author did convince me he was an expert at the type of target costing performed by Toyota, but did not succeed in explaining a coherent management theory based upon it. An attempt to explain too much and a tendency to ramble and sometimes to rant defeated the book’s potential to help people understand and apply the method.

The publisher didn’t do the author or the reader any favors. The developmental editor’s job was to critically appraise the book from the reader’s perspective and help the author craft a vehicle to convey usable and valuable knowledge clearly and logically, however, it needed a thorough reorganization. It also needed more competent copyediting and book layout. Publishing the book in its current state was like manufacturing an automobile full of design defects.

As Jim Rains says, few North American companies use real target cost management (even when they talk about "target costing"), yet it's a critical tool in many admired Japanese firms, those we’d consider “lean.” The reasons for its neglect won’t surprise you: it is detailed, it takes deep experience, and it takes a long time to build up. Rains is the right source for this guidance on improving profitability. He has studied long and hard with the best in the world, and has helped companies move along the path. Early in his discovery of how Japanese firms manage costs, he tried to bring the knowledge into GM, which had immunity to it. The concept of target costing The book reveals the importance of a structured cost management approach in the earliest stages of product design. In the best companies, this is a given. In most companies, however, designers and engineers are not expected to think about cost. Manufacturing gets judged for managing costs that are largely frozen into the products they are expected to make.

You probably already know that typical companies think that

price - cost = profit

but that admired companies think about

price - profit = target cost.

Traditional companies think profit is what’s left over after price and cost vary, so profit can vary wildly. If you reduce your price to drive lagging sales, profit will be lower. If you badger suppliers into reducing cost, profit goes up -- maybe. Admired companies set price based on what a customer will pay for the perceived value delivered, then it sets profit targets based on what will support growth and return on investment. That determines what cost must be, and design and engineering have to achieve that.

Rains argues that target cost management is less about managing the costs, and more about managing the company by thoroughly understanding cost, enabling the company make the right strategic choices to achieve price points and ensure profitability. The company must understand that the task will require a lot of work to develop the knowledge and data it will need to help product design manage costs effectively. The secret weapon is the cost table. Cost tables go into great detail about what to expect for the cost of every material, every process right down to boring a hole in a piece of metal of a certain size with certain machining properties, every bit of scrap, and every minute of labor. The tables are modularized and parameterized for reuse. The people who maintain the tables must know their stuff, continue to learn, and continue to improve the value of the cost tables, which become knowledge assets of the company.

The book itself
If you performed a value analysis for the reader, this core information is what should have been organized and explained. That would take about 100-125 pages of this 200-page book.

The first 60 pages are, to my mind, largely waste. The author digresses about what’s wrong with the way manufacturers look at costs. Anyone who has gotten interested in target costing has probably already heard all that.

The author had a structure in mind -- the ladder -- for how to approach target cost management. Models are nice, but in this case, he seemed to get married to the model -- and the publisher let him -- and it got in the way of the core concepts of the book. It would be enough to say that unless certain practices like lean manufacturing, value analysis, six sigma, and a bunch of three- and four-letter acronyms are in place, the company isn't fully ready for target cost analysis. Using 60 of 200 pages for superficial descriptions of the tools before getting to target costing itself puts up a barrier for the reader.
The next 50 pages set the stage for getting started with target costing and setting up the organization. With more judicious editing, this could have been done in perhaps 30 pages.

The real value of the book is delivered in the next 40 pages. The real core concepts are well explained. Good diagrams examples help develop the idea.

Next is a 15-page chapter on a company called Alpha Brain that built software for target costing, before succumbing to the dot-com meltdown. Jim Rains shares its story with an extremely valuable, complete with screen shots, of how a machined part could be costed effectively. I would have liked to see this made part of the explanation of target costing, not set off by itself.

Finally, we have 20 pages of accounts of how several Japanese companies have used target costing in their management processes. The cases have varied levels of usefulness for the reader. Several are more than 10 years old. Some are more detailed than others. They shed light on what target cost management can do, but it would have been better to have integrated them into the flow of discussion rather than to set them off as a separate chapter.


The publisher’s shortcomings
[Caution: rant ahead]
Besides the lack of developmental editing, the book was flawed by poor execution of fundamental publishing production processes. The book design muddied the presentation. In the "ladder" diagram, the illustrator placed the words loosely around the rungs, making it difficult to tell at a glance which rung a concept belonged to. Then when a rung was illustrated within a section, there was not enough space around the "Figure" to set it off. That made it looked like a formula placed within the text of a math book, but it wasn’t in the proper place in the flow of the text. Let me not belabor the point. Unless you look, it's hard to understand what I'm describing. Still, it was an example of thoughtless book design and the editor should have demanded a change. The copyediting shows me more evidence of the publisher doing the job on the cheap. There are mistakes that make me wince. If the editorial staff had the proper style sheet process, "takt" would not appear as "tact," nor would Aisin Seiki be spelled "Aisen" Seiki throughout the book. That a publisher of so many books about Toyota and lean could let that happen is nothing less than embarrassing.

Publishing is costly, not for the printing, paper and ink, but for the human knowledge applied to the ideas the reader wants to find. Most writers of manufacturing books come from manufacturing, and shouldn’t be expected to be authors. The publisher must provide the resources to shape the book and help the reader find the core message, accurately. The lowest-cost editor doesn’t have enough subject matter knowledge. The process may be collapsed into too few review cycles in a wrongheaded pursuit of “lean” or just by cost-cutting mandate.

The publisher should be willing to spend a few thousand dollars more for subject matter reviewers who will criticize the work in detail and editors who know the scope of what lean means. I don’t see evidence of that in this book.

Recommendation
Pay $50-60 for this book if you are willing to accept that only about half of it is useful. But if you compare that price to the value of improving your company’s cost management or your own capability to understand it, the expense is trivial.

I checked Amazon for other books on the subject of target costing to see if there is a better choice. There were a few, including one by our old friend Yasuhiro Monden, but no useful reader reviews. Not having seen any of them, I can’t help you there. You may also want to look at books on value analysis/value engineering (VA/VE), which is a foundation of target costing.

Target cost management is a subject that lean thinkers should study, but haven’t. Maybe as lean penetrates into product design and supply chain planning, the interest will grow. When that happens, I’d like to see Jim Rains get the chance to share his knowledge in a better book.

Sep 28, 2010

Leaner office processes at BCBSM


A few years ago, I read about a manufacturing company helping a hospital begin to look at lean. I asked an acquaintance at the company whether he thought that reaching out to healthcare by manufacturing lean experts would reduce the burdensome costs that employers bear for healthcare coverage. He said no, not until the insurance companies did something about their wasteful processes.

Now we have good evidence that insurers are getting in the game. The Michigan Lean Consortium had a chance this month to learn about how Blue Cross Blue Shield of Michigan (BCBSM) is conducting its continuous improvement program. BCBSM seems to have been smart about taking in some of the extraordinary improvement leaders who were shaken from Detroit's manufacturing industry. Phil Berry, after a career of continuous improvement leadership at Textron, joined BCBSM last year as Senior Director of Lean Continuous Improvement. He's building an able team of leaders, coaches, and learners who are taking processes apart and putting them back together.

The central staff group of BSBCM CI experts has now trained 230 change agents, usually group leaders and managers of operational groups. BCBSM is different from other insurers in that many of its employees are unionized. This means that they can't work on any activity that may result in decreased employment, although there are many other projects they can participate in. While we didn't hear from union representatives, we were told that conversations with union leaders started early in the process and that the union was on board, within the constraints of its duties to union members.

BCBSM offered buyouts a while ago and more people than expected took advantage of them, actually leaving open positions for which people could be hired. Despite being shorthanded, some departments working on lean focused on eliminating the need for the work itself. That motivated team members to eliminate overload caused by short staffing through improvements, and took away the fear that people would be faced with layoffs.

Now that teams were motivated by the need to reduce work to fit the resources available, they were ready to attack processes, with the support of their change agents and backed by the CI experts. The team that services the State of Michigan account is one example. Delays in responding to customers result in "aged cases," which contribute to the possibility of financial penalties for not meeting performance guarantees. Short one person due to the buyouts, the team was struggling to keep up. They attacked waste and bottlenecks, reduced reporting, improved workflow and consolidated responsibilities, which all added up to reduced turnaround time and saving $75,000.

The emphasis at BCBSM, however, is not on event-based improvements, but on culture change. I'm often bothered about what "culture change" means exactly, but we heard consistently what this meant. Training objectives were geared to a beginning stage of lean, but there is a longer term plan. The idea is to introduce principles, tools, and a common language, and a forum for practice. This evokes the definition of kaizen ("rapid improvements" at BCBSM) that I like best - a way to train the mind to constantly think how to improve. Teams do want to produce actual savings and improvement, and that's what helps get attention from traditional thinkers, but they are also building engagement and changing minds.

One practice used by all teams was a daily huddle in front of a team-created huddle board. Not only does this deal with daily issues, but it also works to sustain the team's forward motion. Cindy Lewis told us they are visual, 15-minute, tightly managed, crisp, well-prepared, and positive. Recently the CI team went through and evaluated teams' huddles and identified issues and training needs, feeding the findings back through managers.

BCBSM is also beginning to reach out to the providers -- the physicians who heal us and get payments from the insurer. They are no happier about coding confusion, rejected claims, and high costs than we are. They are beginning to hold joint projects to help on both sides.

The CI leaders recognize the importance of high-level buy-in, and the reality that it is hard to get. While the initiative has received strong support from on high, it will soon be time to start more training and education for VPs, presidents, and C-level executives in functions other than operations. We know that it is harder to bring them on board, but BCBSM seems to have a plan for that. Seeing how well-planned their strategy has been so far, and how carefully it is being deployed, I have a good feeling about that stage of development.

Sep 17, 2010

Better than the restroom checklist

We were passing through a small town in Delaware and stopped at a local gas station, not one of the big chains. But inside the ladies room door was an excellent visual control for how the owner expected the restroom to look when the cleaner finished.

Aug 29, 2010

Choosing online collaboration tools for teams

some rights reserved by schwa23 on flickr
We know teams are the way to get things done, but it’s hard to collaborate when we’re geographically dispersed. Working together at a distance seems to cry out for technology, but which one? I thought I’d ask a bunch of smart IT guys about it. After all, they have teams trying to get work done too. Here’s some of what I heard from the experts at the LinkedIn group, CIOs.com: Chief Information Officer Network

E-mail is still the default collaboration tool -- it’s familiar and effective to a point. It becomes unwieldy quickly, however, when more than a couple of people are involved. How often have you struggled to make sense of a long email thread with non-chronological messages crossing each other? When you use e-mail to send documents for comment, keeping track of versions gets crazy quickly. That’s when you say there must be a better solution. Naturally, Microsoft and Google appear, as if by magic, each with their own supporters.

SharePoint from Microsoft is a big favorite. Ten of my advisors said they used it -- though not all were enthusiastic about it. Companies with broad Microsoft licenses tend to choose it as part of a package. It stores documents, schedules meetings, includes chat… On the downside, for any complex implementation, outside resources may be required. Some say it needs to be supplemented with more communications and social media tools. Jive SBS was mentioned as an option for adding rich social media features for internal (and external) collaboration. Yammer didn’t come up in the discussion, even after I asked about it, so let’s assume it’s not gaining much ground yet.

In support of Sharepoint, Linda says you can't beat using something that integrates with the rest of the Microsoft tools and Office suite. It saves on training and removes the need to have people learn new tools -- she says she’s seen it work for companies with 95,000+ users with a Project Management portal featuring business intelligence/dashboards pulling data from diverse systems (MRP, ERP, CRM, SaleForce, financial systems, etc.), even creating forms that work with legacy systems.

Google apps were mentioned by four people. I work on volunteer teams that use GoogleDocs, which allow any of us to update a document or spreadsheet. (You can work with .ppt files, but we haven’t so far.) Google Docs are good for users who need the cloud because they have no home server platform.

In the other camp, Mike is a fan of Google Apps Premier (GAP). His company has a number of facilities, and one had a fire last year. With a major proposal due, his team used Google Docs and Google Sites with online chat without missing a beat, he said.

Richard also likes Google Apps because it’s on the web, not dependent on internal factors, and collaboration is real time, as several people can work on a document at once.
And Android has the potential to bring Smartphones into the picture.

Some of the other tools mentioned were:
  • Microsoft Groove
  • ActionBase
  • Cisco WebEx
  • ExpertChoice
  • Wikis
  • MS Project
  • SmartSheet
  • Tableau
  • IBM Lotus Notes

Joaquim has a new iPad and is trying apps. He reports that TODO lets you manage projects, back them up on your desktop/notebook, and share activities with your team, via e-mail. He wonders if tablets will change the game.

It's not the tools but the thinking

The anti-tech solution came from one person -- cutting off access to computers to get people to talk to each other. It’s true that it’s too easy to e-mail people who work a few feet from us rather than taking time to talk face-to-face or to have a quick stand-up meeting. As Patrick said, “If your people sit next to each other but never peer over cubicle walls to talk to each other, all the Sharepoint, clouds, unified communications, etc. will do nothing to change that fact.” Shelwyn said that if you have a collaborative team, almost any tool will probably do.

David echoed what many lean professionals already know -- “Collaboration is more about mindset than it is about the tool. A collaborative culture will leverage any of the tools mentioned above. Likewise, a siloed culture will let them go to waste. Focus on changing corporate mindset and the tools will help the process. They'll never drive it.”

Tom likes to get team leaders in a room for 10 or 15 minutes every morning to understand what is on the agenda for the day and where team members can give or get help. He said it helps build a culture where team members openly discuss concerns/issues/opportunities with peers, and the synergies benefit the overall team performance immeasurably.

These comments are apropos to teams that are geographically close. The issues that come up with distance are more complex. Either way, getting people comfortable with the tools, so that the tools don’t get in the way of people interacting, depends on thoughtful choice and implementation.

Gian said tools need to be very easy to use, and interconnected with the applications that people use every day to do their work. They also need to be customized to business unit or clients they serve, he said, and require a dedicated resource(s) to administer and edit content to ensure that there is enough value that people want to use it.


Addressing the need to collaborate before you automate, Madhu shared his favorite ways to break corporate silos and get employees to collaborate:
  1. A common goal, challenge, or interest motivating employees to come together for a common cause.
  2. Reward or encouragement during the early adoption stages - This need not be monetary but need to have something to encourage and go the extra mile.
  3. Feedback once the common goal has been achieved leaves everybody with a good taste and encourages them to do it again.

Afzal pointed to a need organizations often forget about or skimp on: training. While some would disagree, he sees an age disconnect in the acceptance of tools and technology as a catalyst and facilitator for collaboration. “The generations who did not grow up in a world of global communication have a tendency to feel less at home with using SMSes, instant messaging, video and even audio conferencing, not to mention white board applications, distributed file systems, etc.,” he said, adding, “Any CIO who goes into the deployment of tools without understanding the nature of their user base, and their readiness to accept the tools, is looking for trouble!”

Many thanks to the folks who chimed in to answer my question on the CIOs.com: Chief Information Officer Network on LinkedIn.

Aug 14, 2010

Baby invents social networking strategy on iPad

I was riding in the back seat of a Jetta in Chicago traffic, with my 18-month-old granddaughter in her car seat on my left and my son on my right. He had handed her his iPad with an app for babies -- by touching the pad she could make letters and numbers show up, and make them bigger or smaller or dance around by touching them in different ways.

She seemed to have accidentally exited the game, so she handed the iPad to her daddy, who touched the game's icon, opened it up and gave it back to her. After that happened a few times and they passed the toy across me, I decided to help her. It didn't take long to see how to swipe the icons across, find the distinctive and recognizable one for the game and return it to her. Yes, the iPad is indeed very intuitive to use. But I asked my son why the game kept closing on her, and he showed me the spot on the iPad frame that exits apps.

Then I caught on to her strategy. She was closing the game on purpose, so she could get dad's attention and involve him in her own iPad social interaction strategy -- apparently one that was much more satisfying than playing a silly alphabet game some geeky educator had designed to keep her occupied.

Babies invent new strategies constantly. I wish it was easy to get to that state of open play where new ideas are the best.

Aug 10, 2010

Saturday afternoon with Captain Karl's Lean Nation

Captain Karl
I spent part of Saturday afternoon 5S-ing old files, and decided to make it even more productive by catching up on podcasts of Karl Wadensten’s Lean Nation radio show. If you haven’t heard it, you’re missing something remarkable. Every afternoon at 4 pm Eastern time, Karl, president of VIBCO, interviews someone with an enlightening story about lean, current authors like John Toussaint, and influential thinkers like Jamie Flinchbaugh, Andy Carlino, and Don Dinero.

Karl also talks to people like Bill Hodge and Paul Bonin from UPS and Kenn Fischburg, President of Consumer's Interstate Corp (also known as Toilet Paper World) about his company’s experience with these supply partners and how they helped folks at VIBCO make lean improvements. Hodge, Bonin, and Fischburg were all knowledgeable about lean, willing to visit VIBCO and see what they could offer to streamline processes, and well aware of what the impact on VIBCO’s operations would be.

Starting with shipping, which Karl rightly recognizes at the critical link between you and your customer, the focus was on common problems and not a sales pitch for “what Brown can do for you.” VIBCO’s processes were like those of many companies, requiring rekeying of data when shipping costs were found and handoffs to UPS took place as well as lookup of specific orders -- and VIBCO ships a lot of items. In customer service, representatives had to flip through web pages to tell customers what the price differences would be if they shipped UPS ground vs. next day vs. other options. These were multiple daily transactions, all waste.

You don’t have time to keep up with new services from all your vendors, and VIBCO didn’t know everything UPS could do for them. By being on site, observing what was happening, and identifying frustrating little obstacles, Paul was able to help people solve problems. New abilities for data linking from UPS could add actual shipping status and cost to order records without rekeying, and tracking data could be made visible to customers automatically. (Don’t you love it when you order from an online vendor like Zappos and can see when your order gets on a truck, makes it to Louisville, to Toledo, and on another truck to you, all from a link in an automated order acknowledgement.) Wow, now VIBCO’s order shipping people are moving their customer’s equipment and parts to them, not typing.

In customer service, the rep can enter the order while on the phone with the customer, flip through the various options based on the shipping weight and not have to change pages once. It saves more than time. For customers on the phone, that long pause when the customer can only wait is gone. It’s a better buying experience.

Karl also talked about how UPS helped out when an urgent order just couldn’t be ready by the standard UPS pickup time. Paul happily shares his cell phone number, and he’s ready to arrange whatever he can to handle an exception. Not only will Paul help VIBCO, he offered to hook up any listener with a rep in their area who would do the same good partnering that he does.

At the other end of the value stream -- purchasing -- Kenn Fischburg’s Toiletpaperworld.com applies the lean model to buying office and operations supplies. His website makes it easy to place a credit card order for any number of categories of common products, which will be shipped, usually within 24 hours, from one of TPW’s 26 warehouses. Kenn talked about an early “aha” moment, when a customer asked, “Do you sell candy too?” Kenn’s answer was, “If you want me to sell candy, I’ll sell candy!” That’s grown to a proverbial one-stop-shop for busy purchasing employees.

Toiletpaperworld has a jump on a lot of companies in bringing a friendly social media side to its relationship with customers. It’s capable of being funny -- see the toilet paper survey data in  -- and Kenn writes a blog that appears on the website and in Facebook. Who doesn’t need a trivia break in the office when you’re ordering the most mundane supplies in the world?

Toiletpaperworld has more lean practices internally, which they also share with customers. I wrote about those last year: Helping your customers get lean. (I think the post might have been based on something else I read, which I should have cited, but thanks, Kenn, for the link you added to the Toilet Paper Encyclopedia.)

During the rest of my 5S afternoon, I listened to more about supply chain improvement when Leslie Taito from RIMES hosted a talk with Cheryl Snead, CEO of Banneker Industries and Ron Nussel, Founder and President of ICR Group. I topped off the day by listening to Karl talk to Michael Brassard of Lean Pathways about strategy deployment.

I must confess that, as a print-biased learner, I rarely use podcasts or videos to keep up with lean, but I’m going to do more of it. I’ll be listening to Karl Wadensten’s Lean Nation, because his interviews are so engaging and intense as well as being well grounded in a solid understanding of lean principles. I’m scheduled as a guest August 16, to talk about trends I see, so listen in and send me feedback. It’s a rehearsal of sorts for my debut behind the microphone at the IQPC Process Excellence Leaders Meeting in Chicago September 13-16. Don’t let me make an idiot of myself.

Aug 2, 2010

Massively collaborative projects

Call it a cloud. Call it a community. Call it a project. Social networks on the web can collaborate to produce great things. Everyone knows Wikipedia, but not everyone knows about Project Gutenberg and one of its support communities, the Distributed Proofreaders.

To step back in time to 1450, Johann Gutenberg started a massively collaborative social media phenomenon when he invented the printing press. It freed knowledge from monasteries, clergy and wealthy aristocrats. A man with a bit of capital could print easy-to-read books, newspapers, and pamphlets that almost anyone could buy or distribute for free. Once almost anyone could learn to read, the church or government lost their monopolies on information. It was a revolution. By 1776, the coffee houses of London were raucous networks of idea exchange about the latest news in print. Lloyd's of London coalesced as a collective securitization of merchant shipping risk. Postal services had volumes of new mail to take from person to person.

Now that digital information is freed from paper, just as when printing freed it from parchment, old books are being freed from libraries. Printing saved knowledge from isolation and the risk of destruction, and digitizing knowledge has an almost infinitely greater potential.

Project Gutenberg starts with scanned documents, the same as Google Books. Image scans, like PDFs or specialized viewers, have their limits. Books available unless you have the right program or device. What happens when formats become obsolete? Because Project Gutenberg renders documents in text, they can be viewed or converted almost universally. You can download nearly any out-of-copyright book you can think of, for free, from the Project Gutenberg library on the web. Now the project is moving into more obscure and specialized works, those even more in danger of loss.

Getting from scan to text with people
To get from scans to text is rocky road. OCR (optical character reader) software is unable to make sense of broken type, smudges on paper, and so on. Here's where the massive collaboration comes in: Thousands of human beings, working for no pay, are inspecting the defect-ridden text rendered by OCR, stripping out page headers and footers, and opening up knowledge to anyone with internet access.

The Project Gutenberg Distributed Proofreading (PGDP) network has been around for a while. It has released 18,793 meticulously inspected books to Project Gutenberg. 3,016 are in progress, 688 currently being proofread. How big is the effort? Of nearly 100,000 registered users, 535 people helped in one typical, more than 1,000 in a week, and more than 2,000 in July 2010.
Distributed Proofreaders cumulative results

Not fancy, but functional: The proofreading interface
As if to show that collaboration doesn't have to depend on expensive glitzy platforms from bigtime software vendors, it has evolved on old but robust open source platforms, to include a dedicated project management application, phase gates, community-developed standard work, continual improvement, project bulletin board discussions, an active wiki for collective member knowledge, social interaction, teams, mentoring, and lots of feedback data to members on team and individual progress.

It is a culture as much as a structure for a work process. People drawn to the community have a shared purpose: getting out-of-copyright books into the public domain, usable in any format on any reader, preserving knowledge and classic works. While the number of pages in the works at any given time is immense, the goal requested by the community from any one proofer is a page a day. It's a takt that is easy to swallow.

A sociable experience
As you peel back the layers of the work, the social media levels begin to reveal the personalities of the leaders, as well as the new entrants and the workers who are developing their skills. A conversation on a project discussion board or in the wiki starts to feel like friendship after a while, and our emotional satisfaction brain circuits begin to create engagement. The member becomes part of a team.

In a wiki, people don't always explore the “history” and “discussion” tabs, but they are where the social richness is found. In the Distributed Proofreader wiki, the work process is discussed at high level of knowledge and conscientiousness, a sense of holding the members to high standards, and I'm in awe of the people who make such a huge commitment to creating defect-free texts to share with the world.

From a lean perspective, you might ask how much inspection is appropriate. PGDP has three levels of proofing, two levels of formatting, and a couple more levels of rendering before a text is released. There is a way to record whatever is changed at each level, to show whether proofreaders are just changing the same word back and forth, and to identify give feedback to proofreaders who need more training on the standard. There are a couple of experiments that carry a text through many rounds (the one I saw is up to 10)  to see how people behave when given an endless opportunity to change things. At all times, the original scan is available and the project manager usually has the paper text for validation.

Lessons
What can we in the lean community learn from the Distributed Proofreaders? Some of our projects produce documents, so there is a direct set of lessons. We can also learn how much work people are motivated to contribute when they believe in the importance of the result. Motivation comes out of interaction too. There is an extraordinary emphasis on fairness, civility, and respect for people that is not found in an old-style business culture. And the technology does not have to be the latest in order to produce a good project experience.

In fact, lean tells us that when team members work in close proximity, frequent face-to-face interactions, white boards, paint on walls, and pictures are all more effective than computerized "knowledge management systems" that become knowledge prisons.

But as our teams are forming across functions, organizations, and industries, we need online tools to collaborate, conduct team projects and interact. We won't all have satellite conferences, vast simulations, and virtual worlds to work within.

Project Gutenberg took years to create, and we need to move faster. What open tools do you use for team projects? The venerable conference call? Webex or Go-to-Meeting? Google Docs (my teams use them a lot)? Dropbox? Sharepoint? Have you found something else?

Jul 23, 2010

Social media - can we make it add value to lean?

The social media craze is just that, unless it produces real value, and I doubt value is measured in easy metrics like “followers,” “hits,” or “clicks.”

From the lean perspective, I’ve been struggling with the marketing orientation of much of the discussion of social media. There’s nothing wrong with marketing, but our purposes in the lean community are different. Social media tools ought to further those aims -- of adding value through connections with people, sharing ideas, teaching, learning, and supporting. Otherwise, they are just tools. And if lean tells us anything, it’s not the tools, it’s the thinking.

Yesterday, social media tools worked for me. Let me count the ways...

(1) Google Alerts -- settings in Google search that send you a daily e-mail with links to anything new that has turned up with keywords you have selected. I use them to find new stories and new people that I might share through Twitter, Lean Reflections, writing for Target, or LinkedIn. My alert included a blog post on All things Chromatography about a Delaware company, Analtech, on its lean journey.

(2) Blogging is a great way to tell a story. Ken Grant's post conveyed to me the spirit of lean we like to see. He gave a lot of credit to DEMEP, the Manufacturing Extension Partnership group in Delaware, and included pictures and a (3) YouTube video of a class in session. It happens that I have ties to Delaware. Ken included his (4) e-mail address, so I shot him a message and suggested we talk by (5) phone.

Ken answered the e-mail right away, saying he’d be in the office and giving me his phone number. So we talked. Turns out we had more in common than lean. He's a social media evangelist. He had posted the blog story to show someone the power of social media and had a pretty good argument in its favor when he heard from me just hours later.

Ken is a different sort of lean guy. He’s the sales manager at Analtech, who doesn’t see social media as marketing, but as a way to develop relationships. In fact, he’s so excited about social media that he’s helping the State of Delaware use social media to get better connected to residents. After we talked, he sent me a whole bouquet of links that exploded into a couple of hours of exploration and engagement at my end.

The State’s (6) home page and the rest of the website are becoming more and more integrated with (7) Twitter and (8) Facebook feeds and blogs. And not in a gimmicky way. Everything a resident would want to do with the state government is easy to find.

Ken’s pretty good at the personal networking. He arranges (9) Tweetups, and persuaded the governor, Jack Markell, to appear at one where Jack was shown sending his first Tweet. All this was recorded on video by TV and by any number of (10) phones I saw in the frame of the video Ken sent me. Now Governor Markell tweets several times a day (well, he gets a fair amount of help from his staff). The feed appears on the State of Delaware website. but I skipped over to (8b) HootSuite so I could follow his feed personally. While I was there, I became one of Ken’s followers, and found another feed from DEDOgov, the Delaware Economic Development department’s Twitter name.

Ken had also helped arrange for social media guru Chris Brogan (read the book Trust Agents) to (11) meet with the governor, and I found an arty video of Jack and Chris talking. What I learned about video: if the conversation is fairly ordinary, cover it with cool music and just show the faces of the folks talking. My guess is that the conversation was valuable in helping the governor see that Twitter and such is about relationships, not marketing.

It wasn’t long after I followed Ken that he got the alert and he followed my Leanreflect Twitter feed. Then we connected to each other in (12) LinkedIn. I invited Ken to join the AME (13) LinkedIn Group, which he did.

Back to our phone conversation: You have to understand that in Delaware, everyone knows everyone else. I’ve (11a) met the governor and bent his ear about lean manufacturing and lean in government. The folks from DEMEP have done the same, and taken him to a number of (14) gembas in companies using lean. (I’m going to call going to a gemba a highly productive form of social networking.)

I had to talk to Ken about AME, of course, both our real work in lean and the (15) Social Media Council’s experimentation with social media channels. I suggested he come to AME's (16) conference in Baltimore, less than two hours from Ken’s company in Newark (trivia: it’s pronounced New Ark, not Newerk, as in NJ). Ken said he’d already heard from the DEMEP team that they will be there, and I told him that he should get a team from his company to go too, or at least get a transferable registration he could share with others at Analtech’s 17-person company.

With our common interest in social media, and Ken’s hugely greater experience compared to ours, I asked for Ken’s help on our Council’s plan to assess our lessons learned after our first year in existence and to use lean to become more strategic and connected with AME’s other initiatives in the coming year. Ken said he would, because he believes that the more things your are involved with, the more relationships you develop, and the more good will come out of it. It’s going to be awesome to put Tim McMahon’s and Jason Semovoski’s lean teaching together with Ken’s expertise, and Scott Schiave’s marketing leadership at AME HQ. (Want to be a part of it? E-mail me at Karen.m.wilhelm@gmail.com.) An e-mail went out from me (17) introducing Ken to Tim and Jason.

Continuing with the small-world theme. Ken realized that DEMEP’s Lisa Weis, whose picture is shown in that first blog post teaching a class at Analtech, is on (18) AME’s Mid-Atlantic Regional board of directors. I found Lisa’s email address on the AME website and shot her an email introducing myself.

I count 18 social media points escalating from reading an alert from Google in my e-mail, to reading Ken’s blog post, to exchanging e-mails with Ken, to talking on the phone, to connecting in Twitter and LinkedIn, to inviting Ken to a LinkedIn group for discussion, to getting his gracious response in request for his help in our Social Media council, to getting links from him that connected me with a whole world of stuff happening in Delaware, was fun.

Is there any more than fun and a flurry of jumping from link to link and exchanging gossip about my old home state? You never know. It’s the same with meeting someone at a conference. Sometimes it’s a great conversation and an exchange of business cards.

Real networking is the hoped-for result. Real networking is how we can learn and tap the experience of other lean leaders. It’s how we can pass on help to other lean learners. It happens, and when it does, it’s satisfying to have a human relationship with someone else slogging in the battle to bring lean to all the organizations that surround us.

Ken and I set up the next logical extension of the relationship that started with is blog post. I’ll be visiting family in September and now have a plant visit to Analtech on my calendar. Ken will be inviting someone from DEMEP to join us. Maybe I’ll get really lucky and Governor Markell will show up too.

What will you do today to escalate a serendipitous encounter in social media? If you’re reading this, you’ve put your toe in the water. How about sending an e-mail to introduce yourself to me, or to someone else you run across in today’s web travels? How about raising a social media relationship to a phone call, or raising a phone relationship to an in-person meeting? How about committing to going to a conference?

Let’s work together to bring the value to social media and wrest it away from those who want to make it just another advertising channel. I'll be part of a conversation on that topic at the IQPC Process Excellence Leaders Meeting in Chicago September 13-16.

Speaking of advertising: Here’s what Analtech did in YouTube -- definitely not the same old marketing stuff:



Thanks Ken, for making yesterday fun and for opening so many doors.

Jul 9, 2010

Lean healthcare ideas taking root in Ireland

The flow of lean to healthcare has increased rapidly in the last few years, and Andy Brophy is one of those folks who arrived there from manufacturing. Andy is based in County Offaly, Ireland, and shared some updates with me the other day.

In healthcare organizations large and small, releasing employees, mainly through attrition, will save some money, but someone will have to do the work these people have been doing. Either the remaining staff will be overburdened or someone must eliminate the waste that keeps them from doing the work in the time available to do it.

Removing waste from work doesn't always start with an efficiency study. Andy emphasizes that a focus on cost cutting doesn't usually create a lot of commitment, but that hospital workers want to improve care. And improving care reduces costs in many instances.

Andy worked with one hospital to reduce injuries due to falls. Employees focused attention on the position of patients, making sure they were seated or in bed at a height they could stand up from, for example. Data showed that many falls occurred during shift changes, when patients tried to do on their own what they needed help with: going to the bathroom or getting water. Ensuring that shift change didn't cause gaps in patient assistance made a difference. Visual controls were used to flag patients who were fragile or otherwise had a greater risk of falls, so closer attention would be paid to their safety.

Other initiatives focused on what nurses were spending their time doing. It's typical to find that they spend large chunks of time walking or searching for things. When 1,000 small improvements can be made in a week of effort, labeling and changing storage locations can begin to melt away the waste and put nurses at the bedside, where they really want to be. When nurses are with the patients, there are fewer falls, mistakes, and other adverse outcomes. The important thing is that the nurses themselves, along with other patient care and support staff, identify changes and implement them. Management supports and sustains the process, but it's owned by the people who do the work.

Andy subscribes to the school of thought that people are full of creative and innovative ideas. The title of his book, "Innovative Lean: A guide to releasing the untapped gold in your organisation, to engage employees, drive out waste and create prosperity," co-authored with John Bicheno of the Lean Enterprise Research Center at Cardiff University, tells it all.

He says, "Ideas are not treated as ad hoc actions or suggestions. There is a system where ideas are visually displayed on boards, implemented fast, and recognised. People are coached to recognize 'hidden' waste and the idea system is integrated into daily problem solving. The employee’s manager mentors and supports him or her during implementation. Employees are coached as to what constitutes a good idea. A 'bad idea' is a training opportunity -- the intent behind it is teased out and put forward again. The key is to tap into people’s intrinsic motivation, the natural desire that they have to make a positive difference. The greatest reward for employees is to see their ideas used."

The type of idea process flow that Andy introduces is:
1. Employees write down ideas every time they see an opportunity for improvement and post them on the local idea board with a picture if possible.
2. The idea generator evaluates and filters their idea with their peers, and their supervisor responds within 24 hours.
4. The person who comes up with the original idea implements it themselves or with their work team. If additional help is needed from a support function like maintenance, it is provided and the idea originator oversees the completion of their task.
5. Record implemented ideas in an idea log electronically.
6. Monthly metrics include: number of ideas per employee/team, volume of implemented ideas, participation rate and implementation time.

"If the cycle above flows smoothly the improvement activity will also flow slickly," Andy says, "One idea will lead to another and continuous improvement will translate into improved performance and higher employee engagement."

My talk with Andy helped me see that lean is making the leap from manufacturing into healthcare because principles are becoming explicit and teachable. A critical mass of experience in healthcare improvement is being collected by groups like Andy's, at Lean Enterprise Institute's healthcare education efforts led by Mark Graban, at the Institute for Healthcare Improvement (IHI).

Now lean and quality leaders in hospitals can draw on examples and benchmarks that make sense to people there. Using examples from automobile assembly is no longer necessary.

What's next? Extracting principles from experience makes lean possible in a whole array of industries: Auto repair shops, trucking companies, government agencies, public utilities, and more. It's a trend to watch.

Jul 6, 2010

Tighten the links in your supply chain

In his weekly newsletter, "Lean Thoughts," my friend Richard Kunst talked about linking your supply chain more effectively. Total cost of procurement also figures into his way of thinking. Richard has applied lean at Toyota, La-Z-Boy, and a number of other organizations, so he speaks from experience. Here's his take on the subject:

... In a typical automotive assembly plant, supporting every employee working on the line, there are at least 10 additional employees working somewhere within the supply chain. Suppliers … the hidden factory. So imagine if you struggle with communication internally how can you bridge the link to your external suppliers? We will outline some proven tools and tricks that may help you improve supplier communication and trust.

The market will establish the price so when working with suppliers it should not become part of the discussions towards improvement … it will evolve naturally.

Inventory is time … but it is also a reflection of the amount of trust that exists between you and your supplier. If you have been stocked out or shorted on occasion it is natural to bolster the inventory levels … primarily since no one ever wants to be scolded for shutting down a line due to lack of inventory.

Commodity Management
The most extreme engagement of a supplier with your organization. I learned of this concept many years ago when visiting BOSE speakers and then promptly followed suit. We provided our major suppliers with a desk, telephone and full system access. In essence they were responsible to conduct the planning requirements for their commodity and ultimately placing orders to themselves. Of course this created tons of alarms within accounting … but like most accounting systems we had the inherent controls in place. If the supplier wanted to change the price our standard cost system would immediately alert us to a purchase price variance.

We loved this supply chain technique. It allowed us to manage our 600+ suppliers with just a few buyers. We watched our inventory begin to melt away because no computer system could match the speed of human communication. Also our computer systems never tracked promotional projects that were being or the anticipation of new significant contracts.

A great by-product of commodity management was as our suppliers became more familiar with the use of their products and services within our operation they were able to make suggestions that enhanced quality while reducing costs … add this to the ability to reduce our procurement lead-time we quickly had a significant competitive advantage within our industry sector.

Supplier Technical Exchange Program (STEP)
You are busy within your organization investigating and researching new technologies that will continue to provide your product or service the leadership position it deserves. But are you alone in this endeavour? Of course not, with this in mind we decided to host a formal event annually where our R&D scientists and sales folks discussed emerging desires of the consumer and how we were going to address those needs. We then opened the venue to see what emerging technologies our suppliers were developing … by beginning early integration of the emerging technologies we were first to market with the new technology and a distinct advantage.

Supplier Self Certification Program (SSCP)
You inspect and then count and double count items before shipping only to have your customer do the same thing upon receipt … What does this symbolize about trust?

We know that inspection is a non-value added activity so it makes sense to find a way to reduce and eliminate this activity. With SSCP both sides (supplier and customer) begin/continue extensive inspection and collaboration related to inspection requirements. As the trust grows, inspection requirements begin to diminish to the point where the goods received are delivered directly to the Point of Use. Typically incoming inspection will only identify the most blatant deviations and the real problems are identified when the operator attempts to use the item and then you become victim of missing a delivery promise. Of course, if an incident occurs then the Certification process begins over.

Total Cost Of Procurement (TCOP) –Supplier Report Card and Improvement Agenda
Typically a particular supplier will get tagged as being a horrible supplier to deal with, quality and delivery issues. Often the supplier is unfairly judged, typically as a result of the volume of product they supply. Here is where TCOP is a great tool. It contains both a subjective and quantitative evaluation of your supplier. The TCOP Report captures subjective results related to Quality, Delivery, Service and Cost and then quantifies them for every $1,000 of annual spend conducted with that supplier. The TCOP report also works as an excellent working agenda with your suppliers on the path of improvement. I recall using the report to eliminate the confusion of on-time delivery … supplier thought our request date meant their ship date when it was our required dock date … the result as an overall 3 day reduction of our on hand inventory.
Doing the inverse of TCOP to measure your relationship with your customer works equally as well to reduce disturbances to flow and a cooperative attitude to reducing relationship overhead costs providing for a more competitive strategy.

Of course nothing can replace the importance of relationships with your suppliers, so encourage your senior leaders to spend time with them … but make sure you have good relationship measurement tool in place.

For a sample of a Supplier Performance Report you can contact Richard at rkunst@kunstartofsolutions.com.
Copyright @ 2005-2014 by Karen Wilhelm