LDMS Part 4 | The 20 Keys

What if every workgroup within your enterprise could develop and manage its own improvement plan?

Description: In LDMS post Part 4, we’ll move on to take a look at the 20 Keys (LDMS framework inset20 Keys right). Applying the 20 Keys helps individual workgroups evaluate and understand their own performance, then develop a structured long-term improvement plan for their specific situation (20 Keys cycle inset below). While leadership or third-party resources often help with an initial assessment, many believe that the fact that 20 Keys becomes a self-assessment — that is, the keys are evaluated and acted upon by a workgroup who rates and pushes themselves — is likely to be the most important aspect in its success through compelling buy-in and ownership. Moreover, the plain language quality of the keys means that the key’s level-descriptions really can’t be gamed; something simply doesn’t smell right when reality and numbers don’t track.

About the Process: Utilizing 20 Keys is intuitive. It depicts op20 Keys Assessment Cycleerational or functional work areas (ex.: manufacturing or materials management) in 20 “key” elements (ex.: error-proofing or problem-solving) whose descriptions reflect steps toward world-class performance benchmarks. For each key, five performance ranks are described in plain language beginning with a Level 1 – Traditional through Level 5 – Currently Invincible (table inset below).

20 Keys LevelsCompleted 20 Keys data packs consist of: a chart mapping goal attainment; a corresponding set of point or level descriptors for individual keys; and, a workgroup devised and maintained action plan detailing who does what by when in order to achieve workgroup improvement aims. Overall, a starting point is no less than 20 points (1 point earned for “traditional” in each key) and 100 points is the maximum achievable. Improving 10 points per year in early years is doable. Workgroups having achieved 60 points tend to look and feel fantastic and are quite high-functioning. Although it can happen, we don’t encounter many workgroups over the low 80s.

The graphic (inset below) depicts a 20 Keys chart for a manufacturing cell where the current score (squares) is 30 out of 100. Triangles represent the workgroup’s improvement goals for the individual keys they’ve selected to improve at this time for a 40-point total targeted within six months. A key-by-key improvement plan (not shown) is prepared listing the specific tasks required by workgroup members to attain the point goals.

20 Keys Lean Manufacturing chartIn order to level-set, monitor and review continuous improvement progress, there’s no better approach than Kaufman Global’s 20 Keys®, a proprietary method focusing intact workgroups on the vital dimensions of how it operates versus world-class benchmarks. Transcending both language and culture, organizations worldwide have implemented 20 Keys with sustained success. Kaufman Global has developed over 25 different sets of keys applicable to operational and functional settings, including Customer Service, Supply Chain Management, Engineering and Project Management. Regardless of which sets are used, 20 Keys relays a standard approach to evaluate and improve performance effectiveness throughout your enterprise.

Next Time

Thanks for your attention to this 20 Keys summary! In Part 5, we’ll cover Short Interval Coaching. In the meantime, if you’d like to start your LDMS workgroups off right – or, if you’ve already started and you aren’t getting the expected results, we can help course correct. Kaufman Global offers you: deep, real-world experience, world-class coaching and training at all levels, a rich array of intellectual property, learning materials, and Train-the-Trainer Certification programs all focused on solving actual performance problems so you get a business result while creating organization capability. For immediate attention, don’t hesitate to reach out.

LDMS Part 3 | Kaizen Action Sheets (KAS) System

Kaizen Action Sheets are a core technique to animate Kaizen… small, incremental change for the better.

The Kaizen Action Sheets (KAS) System

Kaufman Global LDMS Kaizen Action Sheets SystemDescription: Within the context of the Lean Daily Management System (see inset at right), the Kaizen Action Sheet is a way to capture, submit and manage small improvement ideas and track the work through to closure.

The Kaizen Action Sheet (KAS) is a single piece of paper (see below) that provides a way for individuals to suggest process improvements within their work area. The document is simple. It asks for a description of the current method and the idea for improvement. Drawings are encouraged as this engages the creative side of the brain! We recommend that the KAS be hand-written to remove barriers to completion and to increase ownership of ideas. Sheets are tracked on a register that is posted on the PVD. Everyone sees progress and percent complete.

Kaufman Global Kaizen Action Sheets System Register

Kaufman Global Kaizen Action Sheets System Sample

 

 

 

 

 

 

 

How the Kaizen Action Sheet (KAS) System Works

Any member of a workgroup can submit a KAS. It is entered into a folder on the Primary Visual Display (PVD) Board  for the supervisor or team leader to briefly review with the workgroup during the daily shift start-up meeting. Once agreed to take forward, the KAS moves sequentially through a series of folders on the PVD as the idea is implemented by the workgroup.

Kaufman Global Kaizen Action Sheets System Sequence

The KAS system requires leadership to engage, support improvement, and remove obstacles and barriers to implementation. KAS improvement suggestions eliminate waste, reduce variation and improve safety, workplace organization and quality. When implemented, productivity improves, inventory balances and a multitude of other material benefits result. It should require minimal cost to put in place, ideally being implementable by the workgroup itself without external support. This is another way of saying: “Keep it simple.” There are plenty of basic waste elimination opportunities inside every work group. Within each workgroup, the focus of the KAS improvements is on the worgroup itself – at least at first. The Kaizen Action Sheets System is not intended to point out problems with other departments or functions.

More than anything, the secret element of the KAS System is workgroup engagement. When individuals and teams experience a simple way for them to participate directly in the improvement process, they become more excited and more enthusiastic about the work they do.

Next Time

Thanks for your time on this Kaizen Action Sheets (KAS) System thumbnail! In Part 4, we’ll cover the 20 Keys® for longer-term world class improvement. In the meantime, if you’d like any help with your LDMS journey, don’t hesitate to reach out to us at: https://www.kaufmanglobal.com/contact/; or, call: +1.317.818.2430.

LDMS Part 2 | SSU and PVD

The building blocks of LDMS.

Read more »

LDMS Introduction | Part 1

Create engaged problem-solvers who lift results every day.

Read more »

Three OpEx Questions You Need to Know the Answers To

A small group recently posed a few questions to us about Operational Excellence, leadership and change. They were looking to get started on their journey and wanted to understand our perspective on some of the critical elements. Here’s a recap of the ensuing discussion…

Q. Leaders mostly understand the benefit of engagement and often see OpEx as a way to obtain this, yet it seems that leaders are not well equipped to make this happen. In fact, the training for leaders is often ineffective. How do we overcome this gap?

A. The graph below is sourced from our YE16 OpEx survey report. It shows how the surveyed organizations ranked the effectiveness of training at various levels of the organization and across a variety of business types:

Img 1 – The relative effectiveness of OpEx and Engagement Training at different levels of the organization. It’s notable that training is deemed most effective at the lowest levels of the organization while executive level training is deemed effective only about 50% of the time.

We can all see the connection between better engagement scores and improved performance, however there is a lot of confusion about what good engagement looks like. Often engagement is thought to be more frequent face time between bosses and subordinates, 360 feedback, suggestion programs, and so on. Rather, good engagement is about giving people the ability to directly influence their work. It recognizes basic human needs that include the power to make decisions, the ability to control outcomes and being part of something bigger. These attributes are not naturally occurring in many work environments so equipping leaders to enable OpEx is about training and coaching them on the essential actions and behaviors they must take to engage and align the organization from top to bottom.

Our approach to ensuring effective leadership training starts with the Managers / Executive Lean Overview workshops. These sessions quickly inform the team with a common vocabulary, awareness and understanding of:

  • Lean concepts and the Lean enterprise
  • Developing the right culture, structure and behaviors to support Lean
  • Managing resistance to uncertainty, and
  • Driving measurable results linked to the business strategy and objectives

Tools and methods are covered, but gaining expert capability on them is not specifically intended. Rather, this portion of the workshop is meant to provide context for how front line practitioners apply problem-solving tools to achieve desired business outcomes.

Our primary objective with leaders and managers is to provide insights that help them define and  develop their own leader standard work. This means doing the hard work of changing some of their own behaviors and habits to be able to actively coach and demonstrate support for Lean to the organization as implementation begins.

Beyond training and workshops, coaching is an important element that we always employ during project work with clients. Coaching is about observing behaviors and suggesting alternatives that can be more effective at delivering certain results. A simple example: If you want people to be more engaged, ask leading questions as opposed to prescribing a potentially ill-conceived solution. In this way, everyone learns something and engagement is supported instead of stifled.

Q. If the leaders are not equipped to lead engagement, can implementation still be successful if delegated to a lower level?

A. No. We’re talking about a shift here that must be valued up and down the organization and especially at the top. These values drive subtle and not so subtle behaviors that become part of the culture and transcend market shifts and personnel changes. Here we assume “implementation” to be a sustainable OpEx system. A leader who is equipped to lead engagement not only understands the benefits, but values the operating norms that better engagement brings.

Since a lot of the heavy lifting and day-to-day activities of implementation are in fact delegated, it’s important to understand how to help leaders do this. We talked about the training and coaching aspect for leaders in Q1 above. In addition to understanding the value of better engagement, the organization must know how to do it.

Everyone in the organization must be expected to spend a small percentage of time on improving the business ― as opposed to running the business. In the simplest terms, this means allowing workers some freedom to fix problems that affect their day-to-day work at the micro-process level. Supervisors and middle managers aren’t exempt: They too should spend about an hour a week addressing slightly more “macro” problems that affect their areas and people. At all levels, the most effective improvement efforts are team-based to drive process ownership and accountability.

Since exactly how to do engagement can be described, the activities can be tracked. This is important because it moves leaders beyond the idea of just “valuing engagement” (because who doesn’t right?) to “knowing how to DO engagement.” Only when this happens can implementation be effectively delegated.

Q. How important are engagement scores to measuring the success of OpEx? What measures would be more important to determining success?

A. Engagement scores are important. OpEx and engagement scores (from surveys and audits) are directly related. Successful Operational Excellence is in large part the result of good engagement. So engagement scores are a good lagging indicator of OpEx and a great leading indicator of operational performance.

A focus on leading indicators is a good place to start. Here’s a way to think about indicators:

  • Leading indicators ― Instead of a “result” metric, leading indicators are often the measurable actions that are taken to achieve a result. For engagement these are the structures and mechanisms we use to cause engagement – for example, the Executive Steering Committee (ESC), Functional Steering Committee (FSC), and Lean Daily Management System®. These structures describe specific, measurable activities that are part of a high-functioning OpEx system.
  • Middle indicators are the process performance measures ― and the associated plans to improve ― at the macro and micro-process levels. These are a tangible reflection of the living adoption of OpEx. The organization likes these a lot because they show something is being done to improve results.
  • Engagement scores are an important lagging indicator that provides proof and external validation that the OpEx system is working (or not). Those who score the highest go beyond better communication and asking people for more feedback. They incorporate ways for employees to have direct input into the work that they do – that is, the work that is relevant for them.

==========

Want  more detail on these topics? You can download the full survey report – An Examination of Operational Excellence – from the Resources section of our website. (It’s great, really).

To learn more about enabling leadership to connect the dots between engagement and value, check out our White Paper: Engage the Organization – And a Performance Culture Will Follow.

 

Five Reasons for Better Employee Retention

The cost of poor employee retention is significant and ever increasing. The ability to retain good people is a huge competitive advantage. Whether the market is going up or down, turnover is a factor for all employers, no matter what your business.

Not sure retention is an area you really need to spend energy on? Consider this… with strong employee retention strategies and tactics, you:

  • Avoid predictable re-staffing costs and gaps

    employee retention presentation

    Click to view our presentation on best practices for a Lean-based Employee Retention methodology

  • Guard intellectual property drain
  • Preserve customer relationships
  • Don’t enable your competitors
  • Develop positive buzz about your organization

Those are some pretty critical wins. And, they all contribute to significantly better business performance. So why not do it right? And by right, we don’t just mean pay increases, stock options and / or bonuses. These pieces alone won’t solve your retention issues. It’s not all about the money… really. While financial incentives can buy some time, they do little to build confidence in the culture of the organization and the enterprise. A low retention rate is always a symptom of other issues.

Without a practical employee retention strategy in place, organizations find themselves parting with a higher portion of their best and most qualified talent, the result of which is losses in productivity, time and money. So how do you stop the bleeding? First, focus on the heart of the issue… people.

The Most Important Employee Retention Factor is Engagement

This chart shows characteristics that frame highly-retentive workplaces

The number one place where organizations get it wrong is engagement. That’s right, when people leave, it’s most often because they did not feel a sense of accomplishment or belonging. People want to feel like they are part of something. For decades, surveys have concluded that compensation and benefits, while important, always rank lower than belonging and the ability to contribute meaningfully when it comes to job satisfaction. Don’t ignore this!

What to Do

There are plenty of ways to improve retention by getting (and keeping) people engaged. Start by including people in improvement activities like process mapping – those working inside the process always know the most about value and waste where they work – this is their chance to contribute their knowledge! Engaging them in the hands-on work of fixing identified improvements should follow via small focused projects (Kaizen Events and Rapid Improvement Events). To ensure energy and support for these efforts, leaders should receive training and alignment coaching to help them understand that it’s OK to give up some control and let the organization contribute more from the frontlines.

To move beyond a project-based approach to engagement, consider the structure and discipline embodied in Kaufman Global’s Lean Daily Management System®.  This is the real deal when it comes to sustainment and a structure that keeps people involved on a day-to-day basis within their workgroups.

Supplemental Reading Recommendation:
White Paper | Engage the Organization and a Performance Culture Will Follow
When an organization is formally and consistently engaged, a culture of performance follows. Understanding how to achieve a performance culture, why it’s so elusive for many leaders and their organizations, and what it takes to make it reliable is the key to sustainable improvement.

Procedural Adherence and Risk White Paper

Procedural Adherence and process discipline are achievable – but only when they’re treated as behaviors instead of tasks.

(This article is an excerpt from our Procedural Adherence and Risk white paper. Click here to acquire the full document in a downloadable format).

**********

Procedural Adherence iconAlmost never do people violate procedures with bad intent. When it happens, it is enabled by a vague work culture coupled with urgent product and service demands. The effects of rules broken ripple through the organization with a range of negative consequences: personal safety, financial results, employee morale and public perception. Learn how to reduce procedural adherence problems and boost performance with behaviors that influence how employees view and deal with risk.

The enterprise works hard to define and defend organizational procedures to maximize speed, accuracy and return — and still, rules are routinely broken. Individuals and teams opt for apparent shortcuts that appear to speed things up, but instead delay progress, sink performance or worse: put people in harm’s way.

Could it be that employees are wired to break the rules? With certain cultural ques; yes.

People view and manage risk at a personal level. This sometimes results in actions that oppose the stated values of the enterprise which include adherence to procedures and rule-following. But there is a contradiction here. Instead of diligent procedural adherence, the enterprise is often more concerned with chasing (perceived) fast results and near-term profit at any cost.

The translation: The true value of the enterprise is that it is actually ok to break rules, especially when a customer-facing issue or revenue stream is in play. From the point of view of the individual faced with the pressure of “getting the job done” it’s simply less risky to violate some procedures to keep the machine moving. This fundamental misalignment of values is a breeding ground for mistakes and ultimate poor performance – including and perhaps especially, catastrophic events.

Achieving a state of better procedural adherence — that is, predictably getting employees to stick to predefined processes and standards — is a losing battle for many organizations. They desperately want people to follow the rules, yet their own culture drives decisions to the contrary. Why? Because everyone treats procedural adherence as a step in a process instead of a behavior motivated by perceived risk.

Many factors impact how employees comply with procedures: company culture, environmental complexities, the quality of existing support systems, and human nature. In this white paper, we’ll break down what drives employees to behave the way they do, so you can recast your organization as one where procedural adherence is the norm.

The Safety Paradox

A popular consensus is that it’s easiest for people to follow safety rules. While a narrow view, it’s useful to illustrate some truths about risk.

The basic reason we enjoy some measure of success with procedural adherence in safety matters is because unsafe behaviors are visible and may result in immediate consequence.

Safety rules tend to be easier to adopt because violations are more visible, and consequences are bad for both the individual and the enterprise.

But there is a more fundamental reason why. Accidents cause personal harm and enterprise disruption. In other words; failure to follow the safety rules can be bad for everyone. This alignment – a mutual understanding of risk – serves to induce a state of better procedural adherence with respect to safety matters.

Safety programs further reinforce these notions by stating that anyone can spot and audit unsafe behaviors and must do so as part of a “safety culture.” Unfortunately, easy-to-observe violations cause only a fraction of all incidents. By contrast, invisible missteps tend to stay buried deep inside complex procedures, only coming to light when something’s gone very wrong.

Given this insight, it’s all the more astounding to realize that, even where it’s clear that procedural non-compliance hurts everyone and rules are explicit, people will still make choices that put themselves and others in harm’s way. When this happens, it tells us a lot about the underlying values of the enterprise and how we all think about and deal with risk.

Two Modes of Thinking Affect Risk Behavior

A procedure is a complex chain of tasks and processes that are linked and sequenced to deliver a product or service to a customer. In that “value chain”, many hands touch and impact deliverables: individuals, functions, departments, service providers, suppliers, partners and so on. Each actor has visibility into their part of the chain, but rarely to the ins and outs of the entire system, nor the potential cascade of consequences that could arise from a misstep.

Mostly, people move through the day doing their job, responding to inputs, and reacting to issues as they arise. Occasionally, there’s a need to divert attention to a more complex problem, but mostly it’s about turning the crank. Immediate surroundings and cultural norms — “the environment” — drive much of their behavior.

Does “get the job done” trump “do the job right” in your organization?

The pressure to perform follows a few main themes: Keep things moving, be efficient, manage costs and assure good quality. No matter what anyone says, or how many DO THE JOB RIGHT posters hang on the walls, job pressure doesn’t necessarily include following the rules. The status quo barks out: Get the job done. In such an environment, going with the flow is perceived as less risky than monitoring and complying with all the procedural requirements. After all, we’re problem-solvers, right? A little rule-bending is expected and condoned.

Thinking Fast and Slow

For all of us, two distinct modes of thinking are constantly in play: fast and slow. Fast thinking is reactive, responsive and automatic. It looks for patterns, gets us through our day and requires little energy. When considering the equation: 2+2, you quickly conclude 4 as the only possible answer. That’s fast thinking.

Slow thinking, on the other hand, is just that: slow. It uses lots of energy because it requires focused attention. You’d need to employ slow thinking to multiply fractions, for instance, or to figure out how to avoid your least favorite relative at the family reunion.

As we fast-think through our day, we’re trying to avoid risk by paying attention to what people around us expect. This is human nature and not much of a conscious decision. Cutting some corners feels reasonable.

At the enterprise level, where policy is made and direction is set, the job IS slow thinking: planning new and better ways of doing things, improving results, satisfying customers and avoiding unpleasant surprises. All of those outcomes seem more likely when people follow the rules, so adhering to standard procedures is viewed as a way to lower risk.

Risk profile comparison table for the typical organization

Table 1 – In a traditional organization, following procedures can be viewed as having high or low risk, depending on one’s vantage point.

Table 1 contrasts these dynamics from the point of view of the individual vs. the enterprise. This misalignment between risk perceptions, plus the reactive nature of fast thinking patterns, are the reasons why your organization might be having a hard time achieving better procedural adherence. If rules are routinely broken where you are, it’s because no matter what anyone says, your organization’s true values are to get the job done — even if it means not following procedures.

A caveat: the foregoing assumes that tasks, processes and procedures are well defined, well documented and well understood — which is almost never the case. If you expect compliance but have not made the procedures clear, easily available and understandable, you’re fooling yourself and shortchanging your valuable workforce.

Procedural Adherence (Re) Defined

Given our understanding of how human nature drives or hinders procedural adherence, we can construct a simple definition. Procedural adherence is:

Aligned values and explicit behaviors that demonstrate the highest regard for following established standards to minimize risk.

If we break the definition down piece by piece, these points are important to understand:

  • When individuals and the enterprise share the same values, that alignment will translate to observable behaviors. As the saying goes, actions speak louder than words.
  • If you expect someone to follow the rules, then you’d better make those rules clear and understandable.
  • Adhering to procedures must become low-risk for everyone.

Our definition of procedural adherence goes well beyond the notion of false slogans and checklists to encourage compliance. It provides handles for people to grab ahold of. If we really want better procedural adherence, values must be aligned and why values were not aligned in the first place is the real root cause analysis that must be done.

Start by getting a grip on definitions, documentation and conveyance of the procedures that need to be followed. Focus on the ones that are most vital to the enterprise. Rationalize the list of critical expectations and then ACT on them. This requires active governance (that probably doesn’t currently exist) versus the typical haphazard, “Let’s do everything” approach.

Once you have a solid set of rational procedures that must be followed, react strongly when violations occur and dig for the cultural root cause when they do. You’ll often find the violators felt they were acting in accordance to their bosses’ objectives and in the best interest of the enterprise. Note: There is often a lot of bad precedent to be undone here.

While the conventional approaches to procedural adherence problems – Defining, Training and Discipline – have their place, they could be sabotaging your compliance efforts by looking like progress, but instead are just more of the same.

Targeting Behaviors for Lasting Improvements

We now know your enterprise and the individuals inside it at many times think differently. People on the ground think fast and avoid personal risk by occasionally breaking rules — and if the organizational culture says it’s ok to do it sometimes, it’s ok to do it any time. Conversely, the “think slow” enterprise seeks to minimize risk by getting everyone to follow the rules.

The key is to align the risk profiles for both. It’s the only path that works because it operates at the behavioral level. This requires a direct frontal attack on the status quo — an uncomfortable proposition for most, but one that must be done if real change is desired. After all, we’re talking about replacing poor habits (behaviors) with good ones. This is a goal that can only be accomplished with an approach that is: (a) highly visible, (b) effective in its execution, and (c) simple enough for everyone to understand.

Functional Steering Committee structure

Figure 2 – A high performing FSC provides the organization a leading indicator of procedural adherence.

Our solution — which many high-performance organizations have successfully adopted — is an engaged and visible coalition of leaders whose implicit and explicit objective is to reinforce a set of values with which everyone can align. We call this body the Functional Steering Committee (FSC). FSC participants are directors and functional heads tasked with managing major process nodes along the value chain. They meet weekly and review procedural adherence status by asking three questions:

  1. Do we have the procedure?
  2. Do we understand the procedure?
  3. Are we doing the procedure?

Why meet weekly? In our experience, a weekly cadence is vital. If less, participants lose interest and urgency. Monthly sessions result in a last-minute rush to gloss over subpar progress and shoddy work. This is the very behavior that better procedural adherence is designed to attack. But by tackling issues weekly, communicating expectations, asking the right questions and demonstrating the benefits of procedural adherence, the risk alignment profiles noted in Table 2 become the new status quo.

Risk profile alignment table for high performing organizations

Table 2 – When the risk profiles are the same for the enterprise as the individual, everyone is motivated to act in the same way because the cultural norm is to follow procedures.

The chartered and structured FSC is a new behavior. It’s highly visible and is a leading indicator of better procedural adherence. Over time, the enterprise and individual employees begin valuing the same things, and decisions become more aligned, consistent and mutually beneficial. And, FSC benefits don’t stop here.

The FSC governs the technical aspects of improvement too, pinpointing gaps that might otherwise go unnoticed. For example, if someone does not have a documented procedure, who better to help than the FSC? If there is confusion about how a procedure is supposed to work, the FSC intervenes. If someone isn’t following the rules, the team will find out why and encourage / remove barriers to doing so in real time. The FSC can surface innovations that can then be built into the formal, standard approach.

With respect to procedural adherence, often this governance role is not being done well, or at all. This is a gap that needs to be closed. Yet the usual objections will be heard: “Do we really need another meeting?” and “Can’t we automate this?” Some will suggest that technology is a better answer, or another meeting is too much. Technology can help, especially in the area of standard templates and sharing best practices. Remember, however, that you’re dealing with a behavioral issue. If “just another meeting” seems like too much, eliminate three useless ones or have the FSC integrate the responsibilities of the team that’s investigating the most recent catastrophe.

One of the biggest problems your organization will face is getting functions and departments to come together to solve system-level problems like procedural adherence. The solutions to these types of problems: efficiency, effectiveness, productivity, quality and customer-focus are solved using Lean and other process improvement techniques. The first step is gap identification, and this new approach with the FSC is ready-made for that.

A New Destination Requires a New Path

Einstein famously defined insanity as doing the same thing over and over while expecting different results. You’ve likely heard that proverb a dozen times, nodded in agreement, and returned to old practices expecting new outcomes.

Likewise, returning to traditional approaches where procedures are treated like guidelines instead of values-driven standards will result in the level of compliance in your organization remaining unchanged… or inconsistent, at best.

It won’t be easy. Old ways die hard. Your organization will face tough decisions about chasing revenue, be tempted by the notion that a small defect or minor violation won’t matter, and that speed trumps standards. These moments of truth happen every day, swaying people to compromise and make poor choices.

The payoff for doing something truly different, however, is huge. Imagine a 20% reduction in catastrophic events and the benefits when this 20% is spread across all types of incidents. Imagine a team of leaders working across functions, better understanding each other’s needs, and monitoring handoffs between them. Finally, consider the relief, shot of confidence and productivity for frontline workers who know the rules, and no longer feel the pressure to disregard them – instead, operating in an environment that demonstrably values them.

 


This post is an excerpt from Kaufman Global’s White Paper: Procedural Adherence and Risk. To acquire a copy of the full white paper, click here.

If you’d like to learn more about the services we offer related to addressing Procedural Adherence challenges, click here.

Time is the Common Denominator of all Wastes

When it comes to improving operations, how many wastes are there really?

I recently read an article that asked the question: How many types of waste are there really? This was in reference to Lean and the original seven wastes in Taiichi Ohno’s iconic Waste Wheel, shown here.

Ohno Lean Waste Wheel

The comments were interesting. Apparently there are tightly-held beliefs on this topic. Let’s try not to over complicate something that Ohno intended to be quite simple, but because waste is the red thread of all Lean, it’s worth consideration.

Purists believe that there are 7 wastes as described by the sensei and there shall be only 7 wastes. Period. Another faction makes the argument for adding the “waste of people’s intellect” or something similar. This notion has become increasingly popular over the years. Kaufman Global added it long ago, but I’ve always found the classification a bit difficult. Is it intellect, human potential, creativity, insight, involvement, et cetera? Unlike Ohno’s originals, these descriptors seem abstract and difficult to attach to an action.

The case for waste of intellect arose from the observation that bosses and managers tend to treat people like cogs instead of active participants in value creation. Ohno’s writings illustrate his struggles to help people understand. Who knows why he didn’t include it in his original work? Maybe he considered himself an “under-cover” social engineer and felt that sticking to hard assets was more pragmatic. Or maybe he didn’t want to too openly point out that management was missing the point? The gap shows no sign of closing soon.

If you want to get really basic, there is only one true waste: TIME. With Lean, time is incorporated in many ways: cycle time, value added time, non-value added time, downtime, uptime, etc. Ohno simply broke it down in a way that made it easy to identify obvious targets to be addressed with appropriate techniques.

wasting time

My take: It doesn’t really matter. Waste can be subdivided many ways. If you think there are 20 different types of waste and this helps attack any one of them better; go for it. In the name of continuous improvement we must be willing to add or subtract in order to improve the system. Right? Yes. Be careful though: More choices seems somehow less Lean, doesn’t it?

People Energy, Alignment and Engagement

Which brings us back to the concept of the waste of people’s intellect. When it comes to achieving operational excellence, a tremendous amount of time is lost by failing to engage people doing their daily work. Non-inclusion results in false starts, half measures, low sustainment and do-overs. Workshops and Kaizen Events may be common, but sustainable results are only achieved when people are tangibly connected to everyday improvement.

Kaufman Global Lean Waste WheelAlignment

Any attempt to be operationally excellent means real and sometimes uncomfortable change; which always meets resistance in some form. Alignment is about getting everyone to support new ways of work. This is a cascading process where actions are different depending on ones place in the organization. If there was only one choice about what to align on however, it would be the need to engage everyone.

Engagement

Engagement means giving people a voice in the work they do and holding them accountable for continuous improvement. Achieving broad engagement up and down the organization is tough for many. Kaufman Global uses structures like the Executive Steering Team, the Lean Daily Management System ® (LDMS ®), and Procedural Action Teams to force engagement. They’re simple enough to understand and do too. If methods are overly complicated, they are easier avoid.

When it comes to waste, everything revolves around time but it’s okay to define as many subdivisions as you like. If you had two to choose, I’d recommend alignment and engagement. When you get these right, smart people working together toward a common goal always solve the other problems.

**********

Notes:

  • Muda is the Japanese term for waste. This is the word Taiichi Ohno would have used.
  • A simple definition of waste is: Anything an all knowing, all seeing customer would not be willing to support (pay for).

If you want to learn more about Kaufman Global’s approach to engagement and alignment, check out SLIM-IT, Procedural Adherence and Lean Daily Management System. For a deep dive into the waste wheel and how it applies to Lean, check out our White Paper: Implementing Lean Manufacturing.

IADC Highlights: Procedural Adherence Video

If you weren’t able to join us at the 2017 IADC Human Factors Conference in Galveston last month, you missed out on a rich dialog. Kaufman Global President Jerry Timpson presented on the topic of Procedural Adherence – why people break the rules, how individuals and the enterprise approach risk differently, and what can be done about it. See his post-presentation interview with Kelli Ainsworth from DrillingContractor.org below.

 

Lean Daily Management System

The Lean Daily Management System (LDMS): Using Structure to Engage Employees and Optimize Value

In the late 1990s, when Kaufman Global developed the Lean Daily Management System ® (LDMS ®), we recognized that “Lean” as a method for improving business was often viewed as a set of tools aimed at machines and inventory. On the surface, and in the simplest of explanations, it was considered to be a group of useful techniques that could be “directed and applied”. I think this was more of a Western interpretation that still reverberates today. In this, the practitioners of the day put less emphasis on the human element and treated engagement as a collateral benefit of Lean, rather than the primary contributor to Lean results. Much of the information available focused on technical aspects such as pull systems, inventory leveling and quick change-over with a bias for discrete manufacturing versus continuous flow, business process or service industries.

Consider these highlights from the 1990s Lean landscape:

Waste Wheel

Taiichi Ohno’s original waste wheel updated with People Energy wastes: Engagement and Alignment

  • Taiichi Ohno’s seven wastes had not yet been updated to include People Energy Wastes of Alignment and Engagement. This has since been added to present day waste wheel diagrams (right), but it is an addition that Ohno probably would agree with today. He keenly understood the value of engagement and human intellect when he said in his book Workplace Management (Ohno, 1988), “Only the gemba can do cost reduction.”
  • The Machine that Changed the World (Womack, Jones, & Roos, 1990). For a decade this book was the primary source of Lean inspiration as manufacturers attempted to emulate Toyota. It is still a compelling description of the benefits of Lean vs. more traditional forms of production. The book describes worker engagement as an important element of the Toyota Production System but it does not peg it as the foundation. Lower inventories and improved product flow are viewed as the causes of higher productivity and better quality when they are actually the effects of a more engaged workforce.
  • Learning to See (Rother & Shook, 1998). All about Value Stream Mapping, it is still the preferred source for this technique for understanding waste and value. It is most effective in manufacturing environments where inventory can be converted to time.

Power to the People

Our fundamental belief then and now is that Lean is a people system, not a technical one. Think of Lean tools like Quick Changeover, Error Proofing, Pull Systems, or Kaizen Events as waste elimination shovels. They work great, but they are useless without some keen insight about where to dig. This was the missing link we sought to address as we first described LDMS. It gives natural work teams the ability to make decisions about where to dig based on their understanding of their issues and performance. Combine this insight with the authorization for them to actually take control and utilize some structured problem solving techniques, and you have a self-regulating improvement engine.

The Lean Daily Management System Methodology

It’s about workgroup engagement:

Lean Daily Management System by Kaufman Global

The Lean Daily Management System

Vital components of the Lean Daily Management System:

  • The standard procedures that help teams continuously improve their day-to-day work (Kaizen)
  • Intact workgroups with common tasks and deliverables
  • Daily short interval coaching (SIC) by supervisors
  • Primary visual Display (PVD) board
  • A daily shift start-up meeting (SSU)
  • Kaizen Action Sheet (KAS) improvement system
  • Metrics the team can influence and control
  • Lean Daily Management System is the primary means of engaging the organization

LDMS is the manifestation of work group participation and this engagement is the fastest route to the overall objective of Lean which is to maximize customer value by minimizing waste. Or said another way: Deliver, at each step, what you need, when you need it, at ever-increasing levels of quality and customer satisfaction. While this cannot be achieved via top-down control, leadership does have an important part to play. “Doing” LDMS must be supported, expected, encouraged and required from above, otherwise it won’t happen consistently enough, broadly enough or often enough to become the way the organization does business.

LDMS Behaviors and Actions are Specific and Observable

The lean daily management system helps communicationThe constructs of LDMS are specific. They describe activities and behaviors that are observable. This gives leadership a natural and specific way to interact with and support the teams. For example, one could ask: “Do you have good teamwork? Are you communicating? Do you measure your work and performance?” In an LDMS environment, all of these things are observable and the teams are able to speak directly to how they do it. That empowerment drives accountability and process ownership downward, where it belongs.

The Lean Daily Management System gives organizations outside the realm of manufacturing something to grasp. When you think of Lean as waste elimination and LDMS as the standard work of an engaged organization, it opens a world of possibilities that go beyond the shop floor. In our experience, LDMS works everywhere. Contents are adjusted – metrics for example will be different in functional and administrative environments than in manufacturing. But when people actively participate in improving the work that they control, they always find ways to innovate and adjust appropriately.

Where is it working? Here are a few examples:

  • Industry: Goodrich, AGCO, Becton Dickinson, Johnson and Johnson, Genentech, Haldex, IR, Goodyear, Owens Corning, Nabors
  • Healthcare: Sutter Healthcare Systems, Oregon State Hospital, Mississippi State Hospital, Lincoln Healthcare Network
  • Government: State of Oregon, State of Indiana, State of Delaware, UK Highways Agency

Why The Lean Daily Management System Works

Should you do it?.. Of course! LDMS makes Lean sticky.

  • People have more personal control and ownership of the work that they do. Individual and team accomplishments become visible.
  • Performance issues and opportunities are more transparent.
  • Process changes and improvement efforts are better connected to day-to-day activities and standard work is easier to achieve.
  • LDMS engages minds and hearts and provides a vessel for employees to contribute in ways that are meaningful and rewarding to them.

Even with all these positives, be prepared for some resistance. It’s something new and people will have lots of questions as the system is coached into the organization. Leaders needs to be encouraged to stay the course until the culture starts to recognize that a broad and proactive approach to performance improvement is the best way to eliminate waste and improve customer value.

********************

Kaufman Global began teaching and implementing the Lean Daily Management System in 1999. It was first described and published in our groundbreaking White Paper: WIn-Lean® Manufacturing in 2000.

In 2017 we updated our content to include even greater emphasis on the fact that the waste of People Energy (Engagement and Alignment) is still the greatest opportunity for any organization seeking to improve performance. For a full description of how and why LDMS fits into any Lean system, download a copy of our White Paper: Implementing Lean Manufacturing: A Holistic Approach.

Results from Kaufman Global clients who have implemented and are using the LDMS:

Oregon State Hospital uses the Lean Daily Management System and here: Oregon State Hospital Presentation

BD uses LDMS everywhere: BDs Corporate Citizenship Report – see page 36

Tier 1 automotive company that deployed the Lean Daily Management System globally

Pharmaceutical company uses LDMS as a cornerstone of enterprise Lean implementation

Oilfield drilling company uses the Lean Daily Management System to engage rig crews in South America (and beyond)

********************

References

Ohno, T. (1988). Workplace Management. Cambridge, MA: Productivity Press.

Womack, J., Jones, D., Roos, D. (1990). The Machine That Changed The World. Based on the Massachusetts Institute of Technology 5-million dollar 5-year study on the future of the automobile. New York, NY: Rawson Associates.

Rother, M., Shook, J. (1998). Learning To See: Value Stream Mapping to Create Value and Eliminate Muda.

Lareau, E. W. (2000) White Paper:WIn-Lean® Manufacturing.