Why Lean Outside the Factory?

By Pascal Dennis (bio)

I wrote a book about it – (The Remedy). Why did I bother?

Because Lean is about reducing waste & variation -- and most of it is outside of the factory.

The past few decades, factories, and Operations in general, have gotten better and better.

There’s still much opportunity, but in many industries they are no longer the bottleneck.

Suppose you order a new Toyota Avalon, Total lead time (i.e. time between your order and delivery) will be something like 30 days.

How much of that time does the vehicle spend at the Toyota Kentucky factory?

A day or so. Most of the lead time is outside the factory and comprises administration, transportation, and plenty of waiting. So where is the opportunity?

Sales, Marketing, Design, Engineering, Finance and so on are the "undiscovered country".

How do we support the good people in these areas?

Here are a few questions to get us started.

For each zone, ask:

1) What is waste?

2) What is value?

3) What are some core mental models?

If we can build on these to define our Purpose clearly, we'll can start to pull in powerful Lean tools to help us achieve that Purpose (Getting the Right Things Done)

Best regards,

Pascal



In case you missed our last few blogs... please feel free to have another look…

Too Often, Power Means the Power to Do Stupid Things
When You’re Convinced You’re Right, You’ve Lost Your Ability to Learn
On Labels – ‘Expert, Master, Sensei’ and the like
Fred Taylor & the Illusion of Top-Down Control - Part 2

Software is Eating the World – What’s It Mean for Lean/CI?

By Pascal Dennis (bio)

Hard to argue with this strong statement. Is there any major organization nowadays that is not an IT organization?

ING Bank, famously, has more IT professionals than Google. Today a Tesla car has more lines of code than macOS or the Windows Vista operation system.

What’s all this mean for the Lean/Continuous Improvement ‘movement’?

Lean/CI practitioners need to raise their games. We have to learn the language, technology and mental models of the digital world.

We have to reach out to our IT colleagues and help them deepen their practice, as they deepen ours.

Lean/CI has had a strong run these past two decades. Most major corporations now in most industries have active Lean/CI ‘programs.’

True, there are still comparatively few brilliant Lean organizations, and most senior executives still don’t understand the methods or the underlying mindsets.

But the Lean/CI tide has lifted most ships, and core concepts such as Value, Waste, Flow and PDCA are firmly rooted in contemporary business practice.

But it’s not enough. Lean/CI has much to offer the digital world. Digitization is an inherently abstract process. Bits & bytes are invisible, as are the circuits that animate a printed circuit board.

The more abstract a practice or technology, the more essential is a counter-balancing engagement with the physical world.

At its best, Lean/CI is simple & concrete. Our old Toyota senseis taught us to continually refine our thinking & processes by removing the unnecessary.

After a while it becomes second nature. Steve Jobs, famously, learned the art of design by studying Japanese calligraphy.

Strategy, problem solving, ideation, rapid experimentation and other core Lean/CI practices require a fluid back & forth between the worlds of reflection & experience.

We go see, reflect on what we saw, and go see again. Such core Lean/CI practices and mindsets can help to enable, focus and refine digitization.

But we have to be humble and open enough to accept that the world is changing very quickly. And we have to work very hard to understand the language, mental models & technology of our colleagues in the digital world.

Good learning, all.

Best regards,

Pascal

Reprise - Why Lean Outside the Factory?

By Pascal Dennis,

I wrote a book about it – (The Remedy). Why did I bother?

Because Lean is about reducing waste & variation -- and most of it is outside of the factory.

The past few decades, factories, and Operations in general, have gotten better and better.

There’s still much opportunity, but in many industries they are no longer the bottleneck.

Suppose you order a new Toyota Avalon, Total lead time (i.e. time between your order and delivery) will be something like 30 days.

How much of that time does the vehicle spend at the Toyota Kentucky factory?

A day or so. Most of the lead time is outside the factory and comprises administration, transportation, and plenty of waiting. So where is the opportunity?

Sales, Marketing, Design, Engineering, Finance and so on are the "undiscovered country".

How do we support the good people in these areas?

Here are a few questions to get us started.

For each zone, ask:

1) What is waste?

2) What is value?

3) What are some core mental models?

If we can build on these to define our Purpose clearly, we'll can start to pull in powerful Lean tools to help us achieve that Purpose (Getting the Right Things Done)

Best regards,

Pascal

Pascal Dennis Bio

Even knowledge workers get dis-engaged

By Al Norval

I was talking with a friend of mine the other day and he brought up an image that I’d like to share with you. He spoke about a eureka moment he had recently. He was in an older neighborhood in Toronto which used to be an industrial area that’s filled with wonderful old buildings from a by-gone era. They were constructed about 100 years ago and unfortunately have outlived their usefulness. The manufacturing companies that once owned them have long since departed and taken their operations either to the suburbs or in many cases to a cheaper country but that’s the subject of another blog.

My friend talked about his dad working in one of these factories assembling parts at a table as one of a long row of workers. The factory consisted of rows of tables with workers making parts and assembling them into products for sale in the Canadian market.

This area is undergoing an urban renewal with the manufacturing companies being replaced with trendy IT companies. The buildings have been refurbished and due respect is paid the previous tenants with gold name plates commemorating the original owners of the building.

As my friend wandered through this neighborhood, he had a deep reflection. That is, that the rows of people working at their tables assembling machines has been replaced with rows of IT professionals working at their computer stations assembling code for software programs. The lunchboxes of old replaced with the laptops of today.

Sadly, many of the same workplace issues of yesterday can remain in place today. Repetitive tasks without the ability to change and improve the work can lead to a dis-engaged workplace as much today as it did 50 or 100 years ago. Empowerment to make change, remove waste and improve the way work is done gives people some control over their immediate work environment.

The result – an engaged workforce constantly seeking a better way.

There are many lessons we can learn from studying the past, that’s the essence of reflection.

As George Santayana said “Those who cannot remember the past are condemned to repeat it”

Cheers

Lean as a Growth Strategy

By Al Norval

There is a common misconception about Lean that I hear over and over again. In fact it’s so common I see it getting baked into the strategy of organizations. That is – Lean is all about waste reduction and by reducing waste we can meet our cost objectives. As always, there is some truth in this statement but I like to take it deeper and go to the next level which is what strategy should really be doing.

True Lean is about waste reduction but the purpose is to provide more value to our Customers. To do this we need to understand what Customers truly value.

Here’s a simple example. I know a company that had loads of finished goods inventory. The common thinking in Lean was that inventory is a waste and so it needed to be reduced. The problem was the company also had a 1 day lead time to service customer orders. Customers placed a lot of value on this and it was a distinct competitive advantage. Cutting inventory would mean longer lead times which could take away the marketplace advantage the company had and lead to lost sales.

The real answer is of course, to reduce the inventory but not by just cutting it, by reducing the causes of the inventory while still maintaining the 1 day customer lead time.

As the company improved the efficiency of their mfg lines by reducing unplanned delay, reducing change-over times and improving the yield they discovered a lot of unused capacity which they turned into shorter replenishment lead times from mfg.

This is the secret behind Lean. Waste reduction frees up capacity in the resources of the organization. Rather than cash out these freed up resources, this unused capacity needs to be turned into value for customers. Providing more value to customers, leads to growth.

Providing more value to customers and growing sales with the same resource base while making the work easier for Team Members is a formula that can’t be beaten.

Lean is really a growth strategy. Organizations grow to success, they don’t shrink to success. Think about this the next time someone asks “How do we cash out our Lean activities?”.

Cheers

Japanese Words – To Use Them or Not?

By Al Norval

One of the questions I am often asked at clients is whether they have to use the Japanese terms associated with Lean. Most times the organization is leaning towards not using the Japanese terms and is looking to me for some kind of validation. I always answer that it’s their personal choice as an organization but there are several things to consider.

The first is that Japanese terms don’t always translate well into English words. Japanese is a very visual language that relies on a character set called Kanji to make complete sentences in their writing system. Each Kanji or character represents a thought or image which is a very different structure from a Latin based language where each letter represents a sound. So translating these thoughts or images from Japanese into English can be difficult and produce some very wordy translations.

Take Jidoka for example. It has various translations including; autonomation, machines with a human touch, built in quality at the source, separation of man and machine work. All of these translations are correct, yet none of them truly grasps the full meaning of the term Jidoka.

A simpler example comes from Jim Hereford as quoted by Mark Graban in his blog of Nov 22, 2011 at www.leanblog.org. Jim gives the example of sushi in defending the use of Japanese terms and says:

“When you go to a Japanese restaurant, do you order sushi or do you say something like, ‘Please get me raw fish rolled in a leaf and rice?’”

Good point Jim.

Another reason I recommend using Japanese terms is in a Lean Transformation we are trying to change the culture of the organization. To change the culture we’ve got to get people behaving differently. Using Japanese terms signals a change and is a great antecedent to the change process. It tells people the status quo isn’t good enough and needs to be altered. It signals a different kind of change process from one where the change is sanitized to make it palatable to the entire organization and thus is watered down and limiting.

I remember working with an organization who had decided not to use Japanese terms.

I asked about “Kaizen” and they said they would use that one.

I asked about “Kanban” and they said they would use that one as well.

I asked about “Gemba” and of course, they said they would use that one as well, but they didn’t like “Muda” and were going to use “waste” instead. Fair enough.

As I said, each organization has to develop their own glossary of improvement terms and needs to think deeply about what kind of culture change they are introducing by using those terms.

For a sample glossary to get you started, please see www.leansystems.org. for a free download.

Cheers