building a lean enterprise: navigating the common obstacles to success

Company

LOGO

Building a Lean Enterprise:

Navigating the Common Obstacles

to Success

May 13, 2010

Your Instructor

2

Provides Lean transformation

support to non-manufacturing

settings.

Co-author, The Kaizen Event

Planner: Achieving Rapid

Improvement in Office, Service, and

Technical Settings

Co-Developer, Metrics-Based

Process Mapping: An Excel Solution

Lean Enterprise Program Instructor

University of California, San Diego

Karen Martin, Principle,

Karen Martin & Associates

© 2010 Karen Martin & Associates

You will learn…

How to establish a five-year improvement plan.

Essential organization-wide learning needs.

How to accelerate results via organization-wide 5S/ Visual

Management, Standard Work, & Error-Proofing activities.

The benefits of establishing a Lean Steering Committee.

How to develop a kaizen culture that generates “single

hits,” while also achieving home runs and grand slams.

How to establish an infrastructure that builds

organizational competencies, while generating measurable

results.

The importance of building a foundation for success even

if you’ve been on the Lean journey for years.

3


Do not underestimate the degree of

learning, patience and resources

needed to experience success!

4


Problem: Weak or No Leadership Buy-in;

Attempting a Grass-Roots Effort

5

Obstacles to Success


The Executive Champion(s)

6


Problem: No Sense of Urgency

7



The Journey Begins

Create and communicate

a sense of urgency /

burning platform

“Why should we care?”

The delicate balance

between motivating and

inducing fear

Data sells!

8

© 2010 Karen Martin & Associates 9

Establish a Sense of Urgency

Shrinking margins

Customer dissatisfaction

Shrinking market share

Rising costs

Increased domestic and/or

global competition

Desire to absorb growth

without adding commensurate

staffing

Impending acquisition

Safety and quality slips

Reduced innovation

Staff burnout

Rising turnover

Regulatory pressure /

compliance issues

Rising litigation

Social, economic,

environmental, or political

pressures

Downward performance

trends (in speed and/or

quality)

The unknown


Problem: Non-Existent or

Unrealistic Strategy

10



Develop a Strategic

Improvement Plan

In many organizations, there is fairly

significant disconnect between what they

aim to achieve with Lean and the way

they go about achieving it.

11


Five-Year Plan

1. Where are we now (in terms of performance)?

2. Where do we want to be?

3. What’s it going to take to get there?

Expertise / guidance

Learning / workforce development

Time

Resources

Strong communication

Leadership

12


Establishing a Strategic

Improvement Plan

Tied to business goals / strategic plan

How much? How fast? Priorities?

Evolution vs. revolution

Establish clear goals and objectives.

What do you hope to achieve with Lean?

Within what time period?

What does that future state look like?

How does it feel?

What is it like to operate in that future state?

How will we measure our success?

13


Achieving Optimal Performance

Quality

Cost

Delivery Safety

Morale

14

Optimal

Performance


Lean as a process design technique

15

P/U

AFrame

Power Pole

Hoist Rig Up Spaghetti DiagramBefore Kaizen Blitz Improvements

Estimated distance walked during Rig Up = 3095 ft

Diagram follows the Floor Hand and does not include moving the A-Frame

Rig Up Time = 90 minutes

Water

Before:

3,095 feet walked

Florida Hospital DeLand

Discharge Process - 2A Pilot

VAlue Stream Champion: Nancy Clark

Future State Value Stream Map

1/26/2010

Customer Demand (2A Only):

8 discharges/day; 55/week; 2,860/year

(Takt Time = 26.2 minutes)

Patient

Hold

Discharge

Huddle

Case Mgr &

Charge

Nurse

PT: 15 mins.

%C&A = 90%

Clean

Room;

Change

Bed Status

to Available

EVS

PT: 30 mins.

LT: 60 mins.

%C&A = 95%

1 mins. 15 mins. 10 mins. 30 mins. 20 mins.

40 mins.

15 mins.

30 mins.

5 mins.

2.0 hrs.

1 mins.

60 mins.

30 mins.

60 mins. Lead Time (LT) = 6.1 hrs.

Process Time (PT) = 127 mins.

% Activity = 34.7%

Rolled First Pass Yield = 21.7%

Prepare

Patient

Primary

Nurse

PT: 15 mins.

LT: 30 mins.

%C&A = 80%

Transport

Patient

Messengers

0900-0430

Nursing

0430-0800

PT: 5 mins.

%C&A = 99%

Write

Order;

Complete

Paper Med

Rec

Phy sician

PT: 30 mins.

%C&A = 80%

CernerCanopy

Implement

Discharge

Huddles

Perform /

Improve Med Rec

at admission

Implement

Visual

Tracking

Relieve nursing from

transporting

nurse-collected

specimens to lab

Create

Standard W ork

for Entire

Process

Clear

Patient;

Create

Transfer

Packet (if

needed)

Primary

Nurse

%C&A = 99%

Enter DC

Info

(Depart I)

Primary

Nurse

PT: 10 mins.

%C&A = 90%

Perform

Med Rec;

Print DC

Packet

Primary

Nurse

PT: 20 mins.

LT: 40 mins.

%C&A = 50%

Remove

Equip &

Items w/

Meds/Body

Fluids;

Call EVS;

Discharge

Patient

Primary

Nurse

PT: 5 mins.

LT: 2 hrs.

%C&A = 90%

Clear

Patient

Case

Management

%C&A = 99%

Additional

Cerner

Training

Process Blocks

Green border = Value-Adding

Yellow border = Necessary Non-Value-Adding

Red border = Unecessary Non-Value Adding

Kaizen Improvement Bursts

Purple = RIE-1

Blue = RIE-2

Orange = Project (Owen)

Green = Leadership (Opal & Daryl)

Error-Proof

Disposition

Codes

Add Pt. to

Discharge

Board;

Update as

Needed

Primary

Nurse

PT: 1 mins.

%C&A = 99%

Note: Ongoing

Error-Proof

Med Rec

Enter Order

HUC

PT: 1 mins.

%C&A = 99%

Streamline

Attending/Consult

Communication

Relieve Nursing

of Patient

Transportation

Discharge

Patient

HUC

PT: 1 mins.

LT: 1 hrs.

%C&A = 99%


Lean as a business management

approach

16

Building a C.I. Culture

17

Heavy support from

seasoned improvement

professionals

Light support from

seasoned improvement

professionals

Support needed only for

audits, bandwidth gaps,

continued learning

Years 1 & 2 Small percentage of staff

engaged – project-based

Years 3 & 4 More staff engagement –

reduced need for formal

Kaizen Events

Years 5 & Beyond Company-wide engagement –

everywhere, all the time

“Settling In” Stage

• Demonstrating learned

competencies

• Process owners manage

performance

• Becoming more proactive

“Life is Good” Stage

• Daily kaizen is the norm

• “Action now” dominates

• Most processes are

stabilized with minimal waste

and output variation

“Disruption” Stage

• Sensei-dominated

• Much mentoring & learning

• Heavy use of Kaizen Events

• Many issues to be resolved


Problem: Lack of Alignment

Around the Improvement Strategy

18



Role Gather improvement ideas from across the enterprise.

Evaluate & prioritize improvement opportunities (closely tied to annual business goals).

Enable alignment across leadership team.

Communicate upcoming improvements and outcomes.

Aid in necessary culture shift.

Assure ongoing process measurement and continuous improvement is occurring.

Determine ongoing workforce development needs.

Stay informed about competing priorities and shift improvement focus accordingly.

Allocate resources.

Assess progress and adjust as needed.

© 2010 Karen Martin &

Associates

19

Create a Lean Steering Committee?


Lean Steering Committee

Composition - 10 people max Cross-functional

Mixed perspectives (sr. leadership, middle management, improvement resources)

Meeting Frequency – scaled back over time Monthly for first year or two

Possibly quarterly for years 2-5

Disband in year 5, if organizational DNA is “set”


Problem: Lack of understanding;

Missing skills

21



Largest Obstacle to Success:

Lack of Understanding & Skills

Lack of training

Ineffective training

Poor timing - Large gap between classroom content

and real-world application

Inappropriate content – too much, too little, etc.

Establish clear learning objectives – what should participants

be able to do after the training?

Does Sr. Leadership really need to go through green belt training?

Improvement professionals need to be proficient in ALL Lean tools and

leading change

No application – learn-do is vital!

All principles and tools and no “sales” (here’s what Lean can do

for us)

22


“Hooking” People into Improvement

23

“You had me at hello.”


Spectrum of Learning

24

Awareness

Deeper

Understanding

Skill

Development

Proficiency

Continued

Learning

Intellectual

Behavioral


Largest Obstacle to Success: Lack of

Understanding & Skill Development

Leadership

Initial ½-day to full-day overview

Reflection and continued learning every six months

Required reading – The Toyota Way and others

Middle management

Eventually at least a 2-day overview about key principles and

process management

Frontlines

Eventually at least a 2-hour overview about key principles

Heavy emphasis re: “what’s in it for me?”

Improvement resources

Significant development

25


Improvement Professionals’

Learning Needs – The Basics

Business

Finance, sales & marketing, operations, etc.

Your industry

Your customers

Your competitors

Regulatory and political environment

Market trends

Your company / organization

SWOT (strengths, weaknesses, opportunities, threats)

Revenue streams

Cost structure

Business goals

Leadership concerns (and other key stakeholders)

26


Improvement Professionals’

Learning Needs (continued)

General

Process management

Project management

Communication

Countering resistance

Lean Philosophy

Value, Value Stream,

Flow, Pull, Seeking

Perfection

PDCA

Workforce engagement

Analytical and

Execution Tools

Key Lean Metrics

A3 Management

Root Cause Analysis

Value Stream Mapping

Metrics-Based

Process Mapping

Spaghetti diagrams

Kaizen Events

27

Improvement Professionals’ Learning Needs –

Tactical Tools

Process

Stabilization

Tools

Flow-

Enabling

Tools

Improvement Professionals’ Learning Needs –

Tactical Tools


Professional Development for

Improvement Resources

University-based

University of Michigan; Ohio

State;University of Kentucky; University of

Tennessee; San Diego State University;

University of California, San Diego

In-house certificate programs or single-

subject workshops

Workshops & conferences – LEI, AME,

Shingo, ASQ, IIE, etc.

Read, read, read…

30


Organization-wide Learning

Lean foundation tools

Tools: Work standardization, error-proofing, 5S & visual

management (using the PDCA method)

Audience: middle managers to senior leaders

Initial training: half to full-day session

Assignment: Improve one area or one process; one

month to complete

Reporting & reflection

A3 problem-solving development

20 max; 4-8 problem teams (owners)

Skilled coach

31


Problem: Inadequate improvement

resources

32



Improvement Resources

Internal

Dedicated vs. shared responsibility

Quantity

External

Training & development

Leading improvement activities

Observational learning + results generation

Coaching

33


How many dedicated resources?

Ultimately 3-5%, per GK.

Examples

2,400 employee org has 4

dedicated resources and

15 part-time trained

facilitators.

1,200 employee

organization has 6

dedicated resources.

34


Problem: Slow results

35



Year One

Experience quick successes

Requires skilled professionals – if not internal, then

bring in external support

Don’t attempt to solve your toughest problems first –

build “improvement muscles”

Gain leadership support

Via education, experience, and results

Familiarize the workforce to Lean principles and

benefits

Begin identifying and/or developing dedicated

improvement staff.

36


Year One – Quick Successes

Select 1-3 value streams, based on business need

Select executive sponsors and/or value stream

champions

Conduct proper value stream mapping activities,

including the development of an actionable

implementation plan

Execute the implementation plan

Heavy use of Kaizen Events to begin shifting culture, develop the

workforce, and gain quick results

37


Problem: Results not

communicated

38



Communication Options

Intranet

Closed circuit LCDs

Posted / Visual

Improvement boards

Break rooms

Hallways

Paycheck stuffers

Company newsletter

Meetings

Standing agenda item?

39


Problem: Processes not monitored

and continuously improved

40



Process Management

Process Owner

Monitors KPIs (key performance indicators)

2-5 max

Types

Operational (Time & quality)

Financial

Customer / external stakeholders

Employees / internal stakeholders

Reports performance

Leads continuous improvement as necessary

Manager or lower is best

41


Problem: Everything waits for a

Kaizen Event

42


Blue = Improvements that do not require help from others. Yellow = Improvements that require help from others.

Shingo-Prize Winning Company’s Suggestion Program

For ideas that require help from other departments:

1. The employee completes a yellow suggestion card and places it on

the Improvement Opportunity Board under the “new opportunity” column for their department. Company-wide improvements are placed in the Company-Wide row.

2. The department’s designated “improvement lead” reviews the suggestions and talks with stakeholder departments as needed. Company-wide suggestions are reviewed by the Lean team.

• If OK’d, the improvement lead moves the card to the “in process” column, allocates resources, and the PDCA cycle begins. When the improvement is complete, the card is moved to the “completed” column.

• If not OK’d, the improvement lead contacts the employee directly and communicates why the suggestion won’t be implemented.

Recognition board includes photos of the improvement and the suggestor’s name. Names from successful improvements go entered in a monthly drawing for prizes.

Shingo-Prize Winning Company’s Suggestion Program

For ideas that do not require help from other departments:

1. The employee completes a blue suggestion card, gets a manager’s

signature, and begins implementing the idea (via mini-PDCA).

2. When the improvement is complete, the blue card is moved to the “completed column.”

Recognition – All the employees names for completed improvements (both yellow an

blue) are entered into a monthly drawing for a gift card (movies, Starbucks, etc.) or T-shirt.

– Pictures of visual improvements with the employee’s name are placed on the “Wall of Fame.”


Problem: Workforce remains

disengaged; improvement resources

are expected to “do for others”

47



Breaking Old Habits

Define facilitator for all

Coach and teacher vs. “do-er”

Communicate improvement resources’

roles and responsibilities

Demonstrate through action

Avoid having improvement professionals

serve as the process owner

Audit function only to assess organizational

learning, progress, and reporting

48


You will learn…

How to establish a five-year improvement plan.

Essential organization-wide learning needs.

How to accelerate results via organization-wide 5S/ Visual

Management, Standard Work, & Error-Proofing activities.

The benefits of establishing a Lean Steering Committee.

How to develop a kaizen culture that generates “single

hits,” while also achieving home runs and grand slams.

How to establish an infrastructure that builds organizational

competencies, while generating measurable results.

The importance of building a foundation for success even if

you’ve been on the Lean journey for years.

49


The Transformation Process:

Key Success Factors

Strong sense of urgency / burning platform

Leadership alignment around strategy

Improvement priorities are closely tied to organizational

strategy and annual business goals.

Careful planning to avoid “implosion” and change fatigue

Value-stream driven improvements.

Heavy use of Kaizen Events in first 1-3 yrs.

Dedicated improvement resources.

Entire workforce receives exposure to Lean.


Karen Martin, Principal

7770 Regents Road #635

San Diego, CA 92122

858.677.6799

[email protected]

For Further Questions