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Lean Insights: Lean trick question: Did you know late starts early?


September 11, 2009
By Dr. Timothy Hill

Topics

Health Care Will Not Reform Itself by George Halvorson, CEO of Kaiser PermanenteGo to: Questions from the plant floor or Books you should know

People often debate about where to start their Lean initiatives. Since most are trying to apply Lean in a manufacturing setting, it seems obvious to them that their Lean efforts should begin on the factory floor.

However, I insist that Lean starts where the real problem is — at the gemba, a Japanese term meaning “the actual place” — and choosing this “actual place” is aided by remembering the Three Reals:
• the real place where work gets done (gemba)
• the real product (genbutsu)
• the real facts and data (genjitsu)

At Toyota, genchi genbutsu means “go to the actual place and see the actual thing” or “go see” for short. So gemba is important to confirm the real problem with the real goods or service and with real data. This is a core element of sustainable and measurable continuous improvement.

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Almost all of the North American manufacturing clients I’ve dealt with have ignored the non-manufacturing aspects of their business. That’s why I tell them that “late starts early.”

A consistent finding in every Lean audit has been that about half of all orders were already late before the manufacturing work started.

Consider the following examples; these are concerns I’ve seen over and over again, but the people to whom they apply don’t believe they make goods or services late.

Waiting on customer call-backs for critical information. Typically, customer relationship management (CRM) tools are not in place or are not part of standard work. When I ask for the range of cycle times from customers, the call-back times go from a few days to weeks, months or longer. Good customers will get back to you right away. Treat the customers you manage as preferred suppliers and contact them regularly.

No takt time for office tasks. The typical laissez-faire-then-blame-the-customer attitude comes from the fact that there are no takt times (the maximum time to produce a product in order to meet demand) for these tasks. Human resources don’t have any accountability measures for office tasks. Saying “when I get to that next” is often acceptable and builds up a “culture of late” before production even starts.

Sales people are rated on closing sales figures and not successful sales, on time, on quality and happy customers. Otherwise, sales and marketing people overload production. Typically, sales and marketing do a poor job of verifying production capacity for orders. Too much work, without load levelling, means orders will be late.

Production triggers are not timed. Early tasks (initial sales overtures, the confirmation of an order, the finalization of technical details for engineering, CAD and related work) must be timed for shop-floor build orders to be on time. Each of these up-stream tasks typically operates with no takt time, no accountability to be on time and suffer from the “I’ll get to it when I have time” problem.

Consequently, about half of all manufacturing orders are late by the time they hit the shop floor. It’s also easier to see problems on the floor than in non-production areas, such as sales, drawing, engineering, supply chain management, logistics, CRM and so on. Therefore, “Lean experts” tend to focus on symptoms on the shop floor and rush to fix them — and only them. This is terrible and bound to fail. Here’s why:

1. They treat a symptom and not an actionable root cause with a verifiable countermeasure. Don’t Band-Aid superficial problems. Ask yourself, ‘For how long were our 5S or Kaizen Blitz efforts useful?’ (answer: not long) and you’ll see the problem.

2. They emphasize problems and not root causes. Let’s begin by examining a common health-care criticism: Is there really a shortage of beds, MRIs, etc., in hospitals? A just-in-time review would show there are enough beds, but that they just aren’t available. Hospitals often treat the presenting symptom and ask for more beds (and making this worse, often close beds in order to meet short-term balanced-budget goals) instead of examining the root cause and looking at how the beds are made available. The same problem holds true for manufacturers — on the floor or in the office.

3. They believe that “quick wins” will engage the workforce. Early Lean failures cause people to stay away from future efforts. Plan carefully for Lean successes and challenge a real problem. Have a PDCA (Plan Do Check Act) plan (or an A3 business case — a method for presenting continuous improvement suggestions) for every improvement opportunity.

Dr. Timothy Hill is an Industrial and Organizational Psychologist and Certified Lean Six Sigma Black Belt with global expertise in Human Resources/Human Capital. He can be reached at drtim@kyoseicanada.ca.

Questions from the plant floor

Question: What size of problem do I select to start my company’s Lean efforts?

Answer:
Good question. Here’s how I would weigh your options, once you’ve selected a few candidate problems:

Is there a good chance of success? To say “yes,” you must have good problem-solving skills to find the true problem (not the presenting symptom). Look to earlier in the value stream to see where the problem actually started. A scratch on a product is not the actionable item — why the scratch happened is what you want to look for.

Is this a high-profile issue that concerns people? If people are engaged about something and you fix it, as per above, you’ll show them the difficult can be challenged. However, a low-profile problem will not engage the largest group of people. Build goodwill, communicate and advertise success. This means assigning these tasks to people: I often ask for a seven-to-14-day snapshot of the Lean progress.

Value-stream mapping (VSM) will provide you with a large number of improvement opportunities — if it’s done correctly. I’ll address this in my next column.

Choose an addressable problem whose solution will engage your people. Develop business plans (e.g., PDCA plans, A3 plans) to plan for success — and hope is not a strategy. As the problem is being resolved, collect data on improvements. And as today’s challenge becomes tomorrow’s standard work, choose your next improvement gap and repeat the cycle.

If you have a Lean question you’d like Dr. Hill to answer, please send him an e-mail at drtim@kyoseicanada.ca.

Books you should know

I mentioned a few health-care examples this month. My two Lean passions are manufacturing and health care. With that in mind, I’ll talk about Health Care Will Not Reform Itself by George Halvorson, CEO of Kaiser Permanente, the U.S.’s largest health-care delivery system. He addresses the why, what and when requirements for change in health care and specifically addresses Lean as the solution. Sometimes looking at a similar problem through a different lens brings you a new level of awareness. I encourage people to read this book for that transformational change and the fact that the topic touches all of us personally.

Several themes should be immediately recognizable from its chapter titles alone:
• Few Standards of Value Exist (no takt time, no expectations for kaizen, etc.)
• New Technology, New Treatments And New Drugs Increase Costs (how many times has the “add technology” answer cost us more?)
• Worker Shortages Add To Increases For Care (GM used to staff 130 to 140 per cent of the workforce to make up for absent employees)
• Only In America Does “It Might Work” Work (“hope” is not a Lean strategy —how many times have your people said “we hope that will work”?)

When visits to other plants are helpful, they facilitate a transfer of training — you learn from their experience. The problem with peer-based business support organizations is that you often don’t learn from the best. This book is a chance to visit with the best and take home excellent and actionable examples.