Lean Laughs!

Why Lean in Sales?

By Pascal Dennis

Why indeed? Isn’t Lean a factory thing?

Well, no…

Lean is a business system comprising the entire enterprise.

The Toyota Business System, for example, addresses the three critical “loops”:

1. Design
   
2. Make
   
3. Sell
   

Guess which one is considered most important? Sell – because it’s closest to the customer.

Sales are about information. What features does the customer want? At what price point? What promotions does he respond to? How does she want to receive her products or service?

How was our last promotion perceived? And so on...

Production (Operations), usually our most valuable & expensive asset, runs on information. We only make what our information tells us to make.

If our information is wonky, our most valuable asset is unlikely to operate in its sweet spot. Result: overproduction, inventory and all the associated ills.

So how do we introduce Lean in Sales?

Here are some questions to get you started:

1. What is value in Sales? (Who are our internal & external customers and what do they need from us?)
   
   
2. What is waste?
   
   
3. What are some core mental models in our Sales department?
   
   
4. What are our current processes for delivering this value?
   
   
5. How aligned are they to delivering the value our customers expect?
   
   
6. How do we improve them?
   

Lean is harder outside the factory – because our product & processes are typically invisible.

If you make scrap in a factory, everyone can see it. “Hey, we made a whole pile of junk yesterday…”

In business processes, by contrast, you can’t see the scrap. A good forecast & a bad forecast look identical…

On the plus side, sales folks are usually smart & creative. If you introduce the fundamentals with finesse, they run with them.

For more, check out The Remedy – Bringing Lean Out of the Factory to Transform the Entire Organization, and our Lean Leadership Brain Booster suite.

That’s all for now.

Pascal

Alpha and Omega

By Pascal Dennis

One of the great ironies of our time is the performance gap between Health Care and the so-called Quick Service Restaurant (QSR) industry.

As anybody who has spent time in the "Waiting Room" will attest. Value-Added time is microscopically small in the former.

By contrast, the good people in the QSR industry are getting better every day -- by applying the Toyota Business System.

Indeed, Business Week has had a series of articles highlighting their achievements.

I grew up in a restaurant, so my heart goes out to people who make the best of slim profit margins, long hours of often difficult work.

Well done, QSR and please continue!

It's easy to make fun, but the best QSR organizations provide excellent value and reliable service, while respecting the customer.

Can Health Care say the same?

Cheers

Pascal

Why Images?

By Pascal Dennis

As you may know, we've worked hard to illustrate Lean Thinking, Tools & Leadership with doodles.

We've developed three corresponding suites of Brain Booster Pocket Cards, as well as an App (& more to come).

We're lucky to have a gifted artist in Dianne Caton.

But even the humblest drawings (like mine) can be interesting.

My latest book, The Remedy, is full of my scribbles, which Di transformed charmingly.

Images go directly to the limbic brain -- the timeless world of direct experience, memory & intuition -- where learning happens.

The rational or Left brain is helpful in processing and applying learning.

But we learn largely in our limbic brain.

Our limbic brain likes stories, images, drama, emotion...

Disengaged students don't learn. Accident victims, who tragically have suffered damage here, also struggle to learn.

So...in our own modest way, we're trying to connect with the seat of learning.

Humor also helps. It's a grim world -- the "Light Touch" has always been my ideal.

People learn best when they're laughing.

Cheers,

Pascal

The Value of Images

By Al Norval

What is the value of an image?

We’ve all heard the old adage – “A picture is worth a thousand words” but what is the real value that’s implied by this phrase? We all know that value is driven by the customer so what value do customers see in images?

Let’s start at the beginning - who is the customer of the image? It’s the person who is receiving the information the image is conveying.

What do the customers want? To receive the information in the least waste way; this means understanding it at a glance and to be able to retain the information.


Let’s look at an example situation. We have new hires into the organization and are trying to bring them up to speed quickly and safely without compromising quality. They are the customers of our training process. We use a TWI based process where we have an experienced trainer and standardized work.

Would our customers, the trainees, see value in images so they can tie what their instructor has shown them to the critical elements of the work? Of course! Images reduce training time and take away much of the confusions that occur when using only words even when we show people as well as talk them through the steps.

Would our customers, the trainees, see value in being able to use images to poke yoke their standard work after the training? Again the answer is Yes. Simple images trigger recall of key learning points.

What is it that makes images so powerful in learning a new concept? Images are much deeper, richer and convey more information. Our brain reacts differently to images. Images cause an emotional connection to be formed in our brains so we form more neural connections with images than with words only. This means we have a greater rate of retention with images and a faster recall of the learning point.

My observation from working with many different organizations is that most training consists of slide after slide of PowerPoint? Why? Because it fits into computer systems better. In reality, our minds work so much faster than the words appear on the screen that we become bored and don’t retain the key teaching points. I believe that images are undervalued in training and we in the Lean community should be striving to change this as part of our work.

For more information on the use of Lean images in training, see Lean Pathways Images.

The Purpose of True North

By Al Norval,

Many companies as they implement Lean and go through a Lean transformation, develop a continuous improvement system modelled after the “Toyota Production System”. These come in all kinds of names and formats ranging from …Production System to … Business System and all manner of variations in between. Often these are just a collection of tools and other stuff and really don’t make up a true system.

If we zoom out and look at the definition of a system, we see that a system can be defined as:

“an inter-related set of parts with a clearly defined outcome”

So the parts of a system are all connected to one another and have to fit together like the pieces of a puzzle. Standardized Work needs to have 5S and Visual Controls in place for it to work. Without them, we could never get repeatable cycles of work. We would be endlessly searching for things. Even with them, there are many interruptions and disruptions to the standard cycles of work which we need to turn into problems and launch problem solving.

So we can see how the parts of a system are related to one another but what about the purpose? A system must have a clearly defined purpose. True North gives us that purpose.

True North defines the outcomes of the system and where we want the system to take us in the future. In essence it pulls us into the future.

True North defines the Philosophical and Strategy Objectives of the organization. It is comprised of two parts:

- Hard Goals that speak to the head and define the hard business targets

- Broadbrush Hoshins that speak to the heart and define direction, purpose and values

Together these are deployed through the organization to align and focus the organization. An analogy I like to use is one of river. The river flows to the ocean which is True North. The broadbrush Hoshins define the banks of the river. The river can take many paths to get to the ocean but we want it to remain inside it’s banks. Along the way it encounters rapids which are problems which must be resolved for the journey to the ocean to continue but all the time the river continues to flow to the ocean.

For more on True North and Lean Leadership, please see Lean Leadership Brain Boosters at http://leansystems.org/cart.php?page=pocket_cards

Waste in Hospitals – Healthcare

By Al Norval,

I had an interesting case recently to observe firsthand the waste in some typical Healthcare processes.

My son enjoys playing rugby and plays on the school varsity team. I have to admit, it’s a sport I don’t understand as I never played it as I grew up. To me it’s players bashing each other back and forth trying to score a “touch” all with no pads and little stoppage in the action. In any case, the boys love it and that’s the main thing.

Like any parent, I went to the games to support the home team. At the last game of the season my son broke his thumb making a tackle. So, we iced it up and off we went to the local hospital’s Emergency Department. As we arrived I called my wife and said we’d be back home in about five hours. Surely, it can’t take that long to X-ray his thumb and set it in a cast. We’ll see I said.

As we entered the waiting area I noticed a short line up in front of the triage nurse. After a short wait it was our turn to answer the questions and fill out the forms after which we took our places in the appropriately named waiting room. Without getting into all the details, I’ll highlight the Value Added steps:
- Thumb examined by Emergency Department (ED) physician.

- Thumb X-rayed by ED technician

- X-rays read by physician

- Broken thumb set in a cast

Needless to say, there were many other steps in the process all of which were waste. Some were necessary steps and the waste was necessary such as the initial filling out of forms, answering questions and even having the thumb re X-rayed in the cast to ensure the bone had set properly. Others such as waiting for the X-ray to be taken and read, waiting for the physician to examine the thumb and answering the same questions several times were pure waste.

As I pondered this during one of our many waiting steps, I realized the key to improvement in Healthcare is no different than any other process. We need to divide the process steps into Value adding, necessary waste and pure waste. We then need to engage our team members in:

- Reducing the necessary waste, and

- Eliminating the pure waste

The overall measure of how much improvement we are making is through examining the Lead time of the process. As we eliminate waste, the Lead time of the process will go down.

How much Lead time did it take for my son’s broken thumb to set in a cast? Five hours...

How much of that time was value added? One hour...

Therefore the waste in the process was about four hours. Fertile ground for making improvements indeed.

Leadership and a Lean Transformation

By Al Norval,

As I work with various organizations on their Lean transformation, it amazes me how many organizations start out believing that Lean is all about implementing a set of tools. They believe that if we only implement these tools, then we’ll be Lean. Often times, I see this develop into implementation lists and audits which check to see how well the tools have been implemented. Sometimes companies carry this one step forward to sending out “Corporate Auditors” with the goal of having a standard set of people to calibrate the audits so the audit scores are valid.

What these organizations miss is that only 10% of Lean is about the tools. The remaining 90% is about people and culture. It’s about engaging people at all levels of the organization to solve problems so that every day we get a little bit better and drive more value to our Customers.



What does this have to do with Leaders?

Tools can be managed but people need Leadership if they are going to change their behaviours and truly start to change the culture.

Leaders need to exhibit these new behaviours. This follows the old adage “What you do is what you get.” What Leaders do is amplified many times over in the organization. Small changes in Leadership behaviour can have an enormous impact on changes in Team Member behaviour in the Value Stream.

But how do Leaders know how to behave in a Lean world?

Their behaviour needs to be based on Lean Leadership Thinking which is based on Lean Mental Models. There are six primary Lean Mental Models:

- Leader as a Sensei

- Go to Gemba to see for yourself

- Problems are gold, make them visible

- Don’t pass junk down the Value Stream

- Simple, visual standards for all important things

- Everyone solves problems using simple methods

As Leaders begin to change their behaviours based on these Mental Models, the rest of the organization picks up on it and more and more people become engaged in solving problems to root cause rather developing work arounds. Business results start to accelerate and Lean becomes locked into the culture of the organization.

For more on Lean Leadership and Lean Mental Models, please see Lean Thinking and Lean Leadership Brain Boosters at www.leansystems.org

Failure Modes in Lean Implementation

By Al Norval

I wrote an earlier blog about failure modes in Lean Implementation in which I described two of the most common failure modes. Both dealt with Leadership.

The first was leaders not recognizing Lean as a cultural change within the organization and the second one was Leaders not changing themselves and delegating Lean Implementation to others.

The two are related in that Lean culture is about discovering problems, solving problems and sharing the learning across the organization. Being a cultural change there is a need for Senior Leaders to lead the way by modelling the new behaviours and making it OK for the rest of the organization to change. The culture change then cascades outwards from examples set by the Leadership team.

So what are some of the changes in their behaviours that Leaders need to make?

They need to let the Lean Mental Models guide their behaviour and change their existing routines. Here’s a few to get started:

- Leader as a Teacher

- Go to Gemba

- Make problems visible

By Going to Gemba and seeing for yourself, Leaders put themselves in a position to act as Leader as a Teacher. Be seeing problems and treating them as gold – to be treasured, they set the tone for the organization. People quickly pick up on these new behaviours and the culture begins to change. See a problem, solve a problem; share the learning becomes the mantra of the organization. Improvement occurs at a faster and faster pace. Everyone jumps on board.

Think of the possibilities.

Sadly, this doesn’t occur as often as it should. Leaders do what they have always done. Improvement occurs, changes are made but sustaining is an issue and soon we’re back to the way things always were.

The choice seems obvious. Why is it so difficult?

Waste in Service Organizations

By Al Norval

Have you ever had people say this to you? I’ve had numerous people say to it me.

“I can see how Lean applies in a manufacturing organization but does it really apply outside of manufacturing? I’m in service, we don’t make things, we’re different”

Providing a service is somewhat different than making a product but from a Lean perspective, all the principles still hold true. It all starts with the Customer and how we provide value to our customers. The key is understanding what Customers truly value and what drives the Value Proposition.

Take a simple shopping experience to a large department store. We could define value narrowly as simply as the consumer purchasing a product (so they must have found value) but what if we expand the definition to encompass the entire service experience the consumer had while in the store. How many of us would pay for the experience of standing in line waiting at a check-out line, or the experience of searching through stacks of articles for the correct one, or the experience of looking for a store clerk to answer questions we have only to have none around or to be told “his isn’t my area”?

Let’s take it one step further. How many of us would pay for the experience of waiting in line to return a purchase, or the ultimate – how many of us would pay for the experience of being placed on hold to wait for a Customer Service agent or endless telephone tree options just to talk to a live person who can answer our inquiry.

When we map the entire customer experience through the customers eyes, we can see the rich opportunity we have as waste is buried everywhere.

In these simple examples, we see waiting, over-processing, correction, inventory (queues), motion, and knowledge wastes.

Why do organizations do this? Typically, because they are looking at short term profits not at providing superior value to customers which will ultimately provide long term profits. Ironic isn’t it? By adding short term costs, we can ensure long term profits if we can provide superior value to our Customers.

Try this. Look at the service you provide and map the process, not from the suppliers point of view but from the customers point of view. I’m sure you’ll find many opportunities for improvement.

How Do Adults Learn?

By Al Norval

Adults learn very differently from children.

Children are sponges. Every day is a new adventure in which new things are learned. Somewhere along the way this all changes and we mature and become adults.

Adults on the other hand, only learn what they feel they need to learn. Adult learning is very practical. If I can’t see how this will help me now, then the true understanding and retention rate of the learning will be very low. I’m sure we can all remember the blah, blah, blah of college professors droning on about some mundane topic that was soon forgotten after the final exam was written.

So, what does this mean?

Adult learning focuses on solving problems. More concretely, realistic problems that people have right now.

When teams have problems, leaders have an opportunity to teach and use the problem to raise the capability of their Team Members. This is the power and magic behind kaizen.

We solve problems and learn in the very process of doing so. This is also the basis of Mental model #1 – Leader as a Teacher. Not to teach like a college professor but to teach Socratically by asking question to build the teams capability and guide the Team through the problem solving process.

Going to Gemba

by Pascal Dennis

Most of us know the value of going to Gemba and few disputes that it’s the right thing to do. So why do so few Executives actually “Go to Gemba”?

The most common issue I hear is they don’t have time to “Go to Gemba”. There is some truth in that so here are a couple of potential countermeasures that will create time for leaders. Biggest item is to spend less time on e-mail. It’s a business killer complete with interruptions and distractions that break your train of thought. Instead, get out of the office and put away the BlackBerry or iPhone and spend time walking around actually talking to employees.

Not just idle chit chat but actually talking about the business. Learn what is actually happening, seek employee input, listen for obstacles preventing them from doing their job, and help them solve their problems in a way which is consistent with the values of the organization. Teach people to fish rather than just giving them a fish. Imagine the power behind that.

Another method to use is the half hour meeting. Each meeting needs to have a Purpose, Agenda and Expected Outcome. Without that we just have milling around which becomes a huge time waster. Follow a set process and you’ll be amazed at what you can accomplish in half the time.

I’m often amazed by the synergistic effect between these two. The more time spent at Gemba, the more you know about what’s actually happening, so the less time you need to spend in meetings trying to figure out what’s going on, and the faster you’ll solve small problems before they become large business killers.

Lean in Healthcare

By Al Norval

There’s an interesting groundswell occurring in the Healthcare industry that’s long overdue. Lean applied to processes that deliver care to patients and not just too administrative processes. The result – improved quality of patient care and less cost in delivering healthcare. Talk about a win-win situation. We can argue about what triggered this. Whether it was government legislation or a public outcry over rising costs, it doesn’t matter. Bottom line is there is an incentive now to change.

In the past, attempts to change the value streams of patient care were met with resistance in the form of arguments against “robotic medicine” and “standardized medicine”. Understandable considering the years of training medical practitioners receive.

The difference now is that we understand all work is a process and all processes have waste. By taking the waste out of the process and standardizing the value adding steps that are left, we create more value for the patient (customer). The standards form a platform for continuous improvement.

In the words of Taiichi Ohno “without standards, there can be no improvement”.

The healthcare provider teams are then more like a great jazz band, all following basic standards that allow them to riff and end up playing great music.

Healthcare teams riff according to the needs of the patient but the team must all be playing from the same sheet of music. The end result a significant decrease in medical induced errors and infections which are leading indicators of improved patient care and lower healthcare costs.

Lean Implementation - Common Failure Modes

By Al Norval

When companies look at the success rate of organizations adopting Lean, they are always surprised at how low it is. Naturally, they always ask about common failure modes and how can we avoid these and learn from the lessons of the past.

As I’ve reflected on this, two common themes appear:

- Not recognizing Lean as a cultural change within the organization

- Senior Leaders not changing themselves and delegating Lean to middle managers

These two go hand in hand. Lean culture is about discovering problems, solving problems and sharing the learning across the organization. Easy to say but hard to do in most company where – “shoot the messenger” and “not invented here” rule.

When we understand Lean as a culture change, we understand the need for Senior Leadership to lead the way by modelling the new behaviours and making it OK for the rest of the organization to change. The culture change then cascades outwards from examples set by the Leadership team.

The Lean culture change required is based on Lean mental models (see Lean Learning Solutions Mental Model Cards); Leader as a Teacher is the first one. One of the key roles of Leaders is to develop the capability of the organization. Not through lecture style teaching but through Socratic style questioning. Leaders who make it OK to raise problems but then coach their teams on how to solve the problem themselves exemplify the role of a Lean Leader – one that can’t be delegated.

Lean Value System

by Al Norval

Lean is about providing value to our Customers and to do this we look at our Value Stream which is the sum of all activities which go into providing these goods and services to our Customers. The Value Stream extends all the way from our Suppliers right through to our Customers and include all the steps in between such as Planning, Distribution and Logistics. We know that in these value streams the value added time is very small often just a tiny fraction of the total lead time of the process.

If this is the case why do so many organizations work very hard at reducing piece price of purchased raw materials by bashing, threatening and coercing suppliers? While we all want the benefits of reduced piece price, we don’t want it at the cost of larger batch sizes, longer lead times and reduced reliability of our Suppliers. In fact we want smaller batch sizes, shorter lead times and improved reliability in addition to reduced piece price. Wouldn’t it make more sense to work together to examine all the waste in our Purchase to Pay systems and work in conjunction with our Suppliers to reduce the waste. Rather than fighting over a piece of a small pie, why not work together so we each get a larger piece of a larger pie. A true win-win for both parties.