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LDMS Introduction | Part 1

Create engaged problem-solvers who lift results every day.

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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.

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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.

 

Lean Manufacturing White Paper: Part 3 of 3

The third and final excerpt in a 3-part series from Kaufman Global’s updated white paper, Implementing Lean Manufacturing: A Holistic Approach.

In Part 1 and Part 2 we covered the genesis of Lean manufacturing, why “pull” is such a fundamental concept and how Lean is an integrated system that goes well beyond technique. Here, in Part 3, we close the series with prescriptive approaches for attacking each of the 9 forms of waste. In this installment we discuss:

  • SLIM-IT ®: A proven structure for successful implementation
  • The Lean Daily Management System ® and the 20 Keys ®
  • A graphic example of what happens when you move from push to pull

Waste Wheel for Lean manufacturing

 

 

 

For each of the forms of waste there are certain attack methods. We start with People Energy Waste because it is the most challenging for most organizations.

 

 

 

Attacking People Energy Wastes

Attacking people energy waste

SLIM-IT, noted on the Master Jargon Chart section above (see the full chart in Part #2), is a pronunciation of the acronym for Structure, Lean (Daily Management System), Mentoring, Metrics, Teamwork, Tools, Training and Technology (SLMMTTTT). Kaufman Global’s SLIM-IT model is the primary engine of any Lean (or other) implementation because it aggressively attacks the people energy wastes that derail so many initiatives. Most organizations have ample technology, tools, training and teamwork “potential” to solve almost any problem or achieve any goal. The difficulty lies in compelling the right combination of the “Ts” to come together at the right time. This is what SLIM-IT does. Figure 6 presents the SLIM-IT model.

SLIM-IT Implementaion Model by Kaufman Global

Figure 6 – The SLIM-IT® Model

The Structure element of SLIM-IT employs several processes / mechanisms, including:

  1. Executive Steering Committee (ESC) that directs and coaches the initiative, ensures alignment and measures engagement.
  2. Work Stream Teams that are responsible for an ESC-approved element of work such as implementing shift start-up meetings or transferring a new product into a facility.
  3. Experts that provide process coaching, an executive sounding board, content expertise and overall initiative management for the organization.
  4. Charters for each Work Stream Team that are developed with and approved by the ESC. Charters include objectives, critical success factors, activities, deliverables, responsibility matrices, schedules and so on.

The building block of Lean is the intact workgroup. These are the hands-on associates who work near each other on similar processes every day.  Each workgroup of ten or fewer people operates its own LDMS that nurtures improvement and sustains realized gains. LDMS compels, coaches, mandates, and supports workgroup engagement in applying the correct tools to minimize waste in their work area.

LDMS consists of six core elements:

  1. Primary Visual Display (PVD) – The PVD is a large visual display that presents the current status of the workgroup on key metrics, goals, objectives and action plans.
  2. Shift Start-Up (SSU) Meeting – This is a tightly facilitated, structured, daily, stand-up meeting of the intact workgroup held in front of the PVD and lasting no more than ten minutes.
  3. 20 Keys ® Action Plan – The 20 Keys approach focuses each workgroup on a long-term improvement plan. Every set of 20 Keys (customized for different functional areas or processes) consists of a chart for mapping goal attainment and a corresponding set of point or level descriptors for individual keys. Each workgroup assesses itself and develops its own 20 Keys Action Plan for improvement. Figure 7 displays a 20 Keys chart for a manufacturing cell that has a current score (denoted with squares) of 30 out of 100 with a goal of 40 within 6 months.
The 20 Keys of Lean Manufacturing by Kaufman Global

Figure 7 – Example: a 20 Keys ® Action Plan for a Workgroup

The triangles represent the group’s improvement goals for individual keys for the next year. The improvement plan lists the specific actions required by the group’s members to attain the point goals. The chart and the accompanying improvement plan are posted on the group’s PVD.

  1. Kaizen Action Sheet (KAS) Improvement System – This technique allows the workgroup to capture small “inspirations” and improvement ideas. These are often “too small” to be considered by the formal suggestion system but are the basis for “kaizen” in Lean. The most important aspect of the KAS system is that it ensures the improvements are relevant for the workgroup.
  2. Metrics – This important element integrates detailed micro-process metrics tracking and short-interval coaching to focus individuals and workgroups on the critical few results drivers for a given process. Metrics are selected by the workers with input from management or supervisors / leads. Workgroup metrics are dynamic – if they are not effective in improving outcomes for the workgroup and overall process, they should be revised. Results are reviewed at the start of each work day by the team as part of its daily workgroup meeting.
  3. Short-interval coaching (SIC) is a technique where supervisors and managers visit the work area frequently (more than once a day) and provide coaching and feedback related to both results and activities. Short interval coaching is the manifestation of a shift in values for the organization. In the new, more Lean way of thinking and acting, there is greater emphasis on engagement (Is the LDMS fully functioning and improvement?), workgroup metrics (Is the information on the PVD up to date?), and improvement (Tell me about some of your Kaizen Action Sheets?). Short Interval Coaching is a vital change management method that must be taught as it isn’t a skill that is naturally occurring in most managers. Everyone in a leadership position can and should participate to reinforce new behaviors.

These five elements, if implemented and maintained, provide a rock-solid foundation for any world-class Lean program. They provide the mechanism for each workgroup to take ownership of their work processes.

Lean Daily Management System establishes the involvement and commitment that are the soul of world-class achievement in every human group endeavor.

All other Lean tools and techniques will realize only a fraction of their potential if any of these elements are not implemented and rigorously practiced.

Mentoring is the next element of SLIM-IT. This is the day-to-day coaching of managers and supervisors in real time, on-the-job, as the tools and techniques of Lean are implemented. The coaching must be done by those who understand the why, what and how of applied Lean. Mentoring is the mechanism that assures that management behaviors at all levels will be changed sufficiently and over a long-enough period of time to infuse them into the organization’s culture.

Metrics get a lot of attention in traditional organizations but they are often misguided. The most common problem is an overabundance of them. Second, the metrics that are most interesting to the top of the organization are often difficult to connect with the day-to-day work. The Metrics in the SLIM-IT model can be described in three ways:

  • Top-Level Strategic metrics that are the traditional measures of overall performance: Cost, Asset Utilization, Quality, etc. Here, less is more.
  • Micro-process: The metrics that workgroups focus on to steadily improve their performance. Here, diversity is key – one size does not fit all.
  • Activity-based metrics: These are the metrics that must be in place to make sure that the organization is engaged and aligned. They measure the occurrence, participation and frequency of the ESC and LDMS along with components contained within – like the effective use of team-based problem solving workshops, Value Stream Mapping as something more than a one-time occurrence and the 20 Keys. Personal performance measures and coaching also play a role here.

The linkage between these three types of metrics deserves careful consideration. Usually the top-level metrics get all the attention with little thought to how they are affected by micro-process improvements or measures that ensures broad participation.

Tools, teamwork, training and technology approaches are used by every organization in attempts to improve. Many of these approaches work if properly implemented. The key to their success is combining their usage within the other elements of SLIM-IT. Without a foundation of structure and coaching, tools, teamwork, training and technology will fail to deliver what they promise.

Attacking People Work WastesAttacking People Work Waste

Workplace Management methods are used to minimize people work wastes. They include standard work, workplace organization and Kaizen.

  1. Standard Work techniques are related to traditional Industrial Engineering (IE) analysis. With IE, engineers measure working time to establish concepts like “earned hours.” Standard work involves much more. Using a variety of worksheets (see Figure 5 – Master Jargon Chart), workgroups assess their own work and establish the best way to eliminate all types of waste. Standard work analysis leads to the development of Standard Work Instructions. Notice the sequence of this: The intact workgroup (team) determines the best standard way to do the work, then the Standard Work Instruction is developed. Many organizations get this completely backward and attempt to describe the work from outside the process. This always fails and always requires re-work.

The worksheets and templates used to develop standard work are extremely important for two reasons. One, they permit workers in an area to identify and measure micro-process waste that might otherwise be overlooked as insignificant. Two, in the process of attacking waste, workers develop the feelings of ownership that are so critical to the success of the people energy waste techniques. Figure 8 displays the “before” improvement portions of two types of worksheets for an actual cell.

The numbers on the Standard Work Instructions (SWI), shown in the left portion of Figure 8, represent worker actions. These actions are measured and classified as manual (hands-on) work, waiting, machine or walking on the Standard Work Combination Sheet (SWCS) shown in the right side of Figure 8. The cell is in trouble because it cannot meet its takt time of 65 seconds.

Standard work instruction and standard work combination sheet in push system

Figure 8 – Portions of a Standard Work Instruction (Left) and Standard Work Combination Sheet (Right) Showing the “Before” Situation in a production cell.

  1. Workplace organization, which is intimately involved with standard work, optimizes a workgroup’s environment through labeling, workplace / tool / part arrangement and visual displays. 5S, a Lean technique for cleaning and organizing is usually the starting point for workplace organization. Many organizations start out here because it’s easy for people to understand and natural for them to do. However cleaning and organizing is often the end point for many Lean endeavors. Visual systems – color coding, labeling, floor markings, andon lights, etc., are powerful techniques for making Lean part of the fabric of the enterprise, but they are only part of the system and are not a one-time event. They must be done with the same discipline and follow-up as any of the other methods described here.
  2. Kaizen, which appears as a separate approach in Figure 5, is actually the interplay of SLIM-IT with all of the other methods and techniques. It’s both the spirit and structure of worker participation in a focused manner. Kaizen Events are structured, team-based problem solving workshops of variable duration. These are only effective when supported and sustained by a functioning Lean Daily Management System.
Standard woek instruction and standard work combination sheet for pull system

Figure 9 – Portions of a Standard Work Instruction (left) and Standard Work Combination Sheet (right) showing the “After” situation for the production cell shown in Figure 8

The “after” situation in Figure 9 shows significant improvement toward the elimination of three types of People Work Waste within the cell: walking, waiting and processing. This optimization develops over time. The workgroup is aware of their performance based on their metrics that are a visible part of their PVD board. Sometimes the improvements are incremental and part of the Kaizen Action Sheet System. Sometimes, the improvements are more abrupt and come from Value Stream Mapping or a Rapid Improvement Event. The point is that the standard work of continuous improvement that is embodied by LDMS is a major influence on workgroup, and therefore overall, performance.

Attacking Quantity or Material Wastes

Attacking quantity waste

Just-In-Time (JIT) methods address the quantity wastes of making too much WIP, inventory and movement. Some people refer to all of Figure 5 as JIT or Kaizen. While technically incorrect, the JIT association is frequently made because you cannot employ JIT techniques to remove quantity waste unless you also address the other wastes concurrently. The kaizen substitution derives from much the same logic, although the popularity of kaizen blitzes has made kaizen an all-purpose descriptor for Lean for many people.

There are four primary JIT methods: kanbans, leveling, Quick Set-Up (also known as SMED: Single Minute Exchange of Die), and preventive maintenance (PM). We have already addressed kanbans and work leveling to some extent earlier in the paper.

  • Quick Set-Up is a collection of “best practices” that apply standard work and some machine modifications to changeover activities. A typical SMED study involves creating worksheets on a changeover and attacking the root causes of waiting and processing wastes. Reductions of 90 percent or more in changeovers and set-up times are not uncommon with SMED. Machines must be integrated into the level work of a JIT approach. If machine set-ups and changeovers take too long, there will be waiting waste (if downstream parts are not available) or inventory waste (if large lots accumulate to provide work during changeovers).
  • Preventive maintenance is the final JIT method. In a finely tuned Lean system, unplanned downtime is a bigger problem than in a traditional push system that is glutted with inventory. When a machine breaks down in a Lean system, there is little built-up inventory and delivery to the customer is at risk. A well-structured Lean system has well managed safety stocks to protect the customer during such repairs. Lean systems train operators to do routine preventive maintenance tasks such as lubricating and checking so that maintenance technicians can attend to overhauls, teaching operators and making design changes to improve machine efficiency.

Attacking Quality WasteAttacking quality waste

Error Proofing often referred to by its Japanese name, poka-yoke (pronounced “polka,” as in the dance, “yolk,” as in the egg, and “a,” as in bay), uses a variety of detection, warning, prediction and prevention mechanisms to catch or prevent errors at their sources. As you can imagine, the implementation of workplace management would automatically generate a number of error proofing actions (and vice-versa). Error proofing is a primary technique for quality improvement in Lean because it is so basic and easy for people to apply. One of the primary sources for error proofing ideas is via the Kaizen Action Sheet method contained within the Lean Daily Management System.

Six Sigma is a comprehensive set of practices that takes careful aim at variation reduction to improve product and service quality. It contains within it specific methods for statistical analysis, project management and problem solving and emphasizes the DMAIC model: Design, Measure, Analyze, Improve and Control.

The Danger of “Tool-itis”

As you can see from the above discussions, the fundamentals of Lean are not complex. Yet, few organizations pursue it as a key strategic goal. Many failures with Lean are derived from a “tool shopping” mentality. Rather than designing a step-by-step implementation of Lean, they attempt (either by accident or through management-led efforts) to cherry-pick bits and pieces of elements found in the “focus points” column of Figure 5. These organizations believe that if they install a few of the pieces, Lean will eventually happen on its own. This never occurs – especially since the isolated tools are typically accorded little management support and don’t mandate engagement. Examples:

  • Kanbans and lot size reductions will always reduce inventory, but they often generate more waiting waste unless standard work is pursued.
  • Error proofing efforts will eliminate only a small portion of those wastes that could be tackled with kaizen and workplace management methods.
  • SMED procedures will dramatically reduce machine downtime in any traditional plant, but the economic benefits pale next to those that also installed kanbans and work leveling.
  • Kaizen blitzes, or rapid improvement events, will deliver big results quickly but without a significant, planned effort to engage the broader organization, the benefits won’t sustain.

It is essential to realize that Lean involves both a philosophy and its accompanying approaches and tools. They are mutually supportive and interwoven. If an adequate number of the tools and approaches are aggressively implemented – and enthusiastically coached at the micro-process (hands-on worker or “gemba”) level – the philosophy of Lean springs to life.

Simply stated, the full impacts of Lean can only be achieved by implementing a total systems approach.

Conclusion

Lean manufacturing is a people process, not a tool installation exercise. It is a journey, not an event. It’s an intensive and proactive effort that requires planning, resources and day-to-day management attention and coaching. It is not easy or painless and must be approached with the understanding that it will take time to change and even longer to create a new Lean culture. Those who endeavor to pursue it holistically will reap the significant performance gains that will allow them to win in increasingly competitive markets, provide significant shareholder value and by enabling an organization of engaged and empowered problem-solvers.

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If you’d like a pdf copy of the entire white paper (Parts 1-3 in one place), click here to access it via our Resources page.

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About Kaufman Global

Kaufman Global is a proven implementation partner that focuses on accelerating performance. Since 1995 we have worked with clients around the world to drive enterprise-wide change initiatives and cultural transformations. Leveraging Lean, Six Sigma and proprietary change management techniques, Kaufman Global delivers structured implementation and transformation projects that enable sustainable operational and financial results.

20 Keys®, Lean Daily Management System®, LDMS®, Lean Leadership®, SLIM-IT®, WIN-Lean®, and the Kaufman Global logo are registered trademarks of Kaufman Global.

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.

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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)

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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.

Transform and Sustain: The Connection Can Be Difficult

Nothing is Transformed if it Cannot be Sustained

transformation journey to sustainClients never say: “We want to transform and do better, but we don’t care if we sustain the improvements.” Clients always profess a sincere desire to sustain results. This intent is so pervasive that during the past 20 years we’ve seen the rise of Operational Excellence as a legitimate function across wide swaths of business and industry. Yet most organizations fail to realize this apparently lofty goal. Low levels of lasting success are usually explained at a tactical level, but the reasons that leaders and their organizations get it wrong goes much deeper.

To get a handle on what is happening and why, we explore some of the traditional norms, individual behaviors and corporate incentives that must be rethought to enable transformation success. As a first step, let’s define a few simple rules that are the foundation of any successful initiative:

Rule 1 – The Environment IS Dynamic

It’s obvious to say, but our environment is dynamic. Everything changes all the time. “Sustain” conveys a sense of holding something – a process or procedures for example – in place. It’s time to re-evaluate this concept and acknowledge that in a dynamic environment, sustain doesn’t mean we pin something to the ground. Rather, it means we stay in lock-step with a moving target, consistently and credibly adjusting and improving.

Rule 2 – Understanding Value

Value is best understood where it is created. People know the most about optimization of the things they work on. Even more important, people care more about the things they work on than the things they don’t. Failure to grasp this rule is why top-down control of improvement systems doesn’t work well and never lasts.

Rule 3 – The Leader’s Role

For any of this to work – meaning, ongoing improvement and sustainment   ̶  the organization must be engaged and stay engaged. In simple terms:

More Engagement Equals Better Results

A primary (perhaps the primary) function of leadership is to compel engagement.  Easier said than done, we can state flatly that engagement is an activity that can be measured and when it’s missing, overtly addressed. Experience tells us that if engagement is not compelled, it will not happen enough to deliver lasting improvement.

When everyone works on solutions with cadence, structure and discipline, peers are required to spend time together improving their deliverables along the value stream. Team dynamics increase accountability and generate performance momentum. This is the catalyst for sustainment.

Internalizing and applying these rules to any improvement system increases the odds of success. Fail to apply them and results will be sub-optimized at best. Going to the next level requires understanding the underlying organizational behaviors that come into play in the struggle to transform and sustain. Here they are:

Engagement is Not Understood or Valued

The building blocks of lasting transformation revolve around getting and keeping everyone engaged (Rule #3). Unfortunately, organizational dynamics and behaviors that deliver this are seldom experienced or even witnessed. And, “What good looks like…” is rarely part of one’s education or training curriculum.  Understanding the structure of engagement so that it can be baked into the DNA of the system is essential to going beyond the “what” of transformation and getting to the “how” of it.

How to Sustain is Not Defined

In some respects it is difficult to separate transformation and sustainment. They are two sides of the same coin. But if we see engagement as the glue that holds these concepts together, it deserves a definition that is simple enough to act upon. Therefore:

The organization is engaged when you, your peers, your superiors and subordinates spend at least one hour each week actively improving the business.

This is what good looks like. When you overtly define engagement at an individual level, the behaviors and actions of it can be observed, measured and mirrored.  Too often, leaders want everyone to really “get it” before they do it. Transformation happens in the reverse.

For Many, Putting Energy Into Sustaining Activities Doesn’t Pay

Transformation initiatives most often occur inside a business emergency. During these times, communication spikes, teams are formed, actions are chartered and things get done. It feels great! When it’s over, the quorum disengages, momentum wanes and everyone reverts to business as usual. The final step is recognition and reward conveyed for fixing the crisis. Big changes, big projects, and big results – these are the things that get noticed and rewarded. Everyone working on small, incremental changes and improvements for the better? … Yawn.

When the requirements for sustainment are poorly defined, not well understood and appear difficult to measure, they are avoided. Success requires broad participation, openness to new ideas and a convergence of standard, simple mechanisms aimed at improving the business. Overtly make the connection between transformation and sustainment, then weave it into the compensation, reward and recognition system. Make it safe and make it pay.

Proactive Problem Solving Might Seem Simple and Boring… and People Are Easily Distracted

The concepts and execution requirements described here are so simple that they are easily dismissed. The ideas of broad inclusion and a flatter organization often require a significant re-evaluation of organizational norms and are naturally avoided. Any distraction; the latest crisis, a new technology or any approach or method that might require less coaching and change management is a welcomed relief. Without some overt activities that demonstrate our adherence to engagement, most will shift away – usually with the tacit approval of their bosses who never got it in the first place.

It Disrupts the Status Quo

When engagement and sustainable transformation starts to occur, decisions are pushed down in order to optimize absolute value. This is a shift that challenges well-established networks that are built around personal relationships and existing dynamics. It’s disruptive. This above all others is the biggest reason for failure.

The truth is this shift frees energy that is traditionally spent on re-work, redundancy and errors. Not everyone will see it this way but when the new system of engagement is well defined and well structured, resistance is easily surfaced. Shifts in organizational and personal behavior are required. Recognize the fact that something that threatens entrenched relationships and systems succeeds only with a crystal-clear mandate, a well-defined plan and adequate coaching.

With all these obstacles, it’s no wonder the majority of organizations and leaders lament an inability to sustain their transformation and continuously improve. Start by viewing the system holistically with a keen eye on organizational dynamics, individual behaviors, simple definitions and an approach that is firmly linked to activity-based performance measures. This will help avoid rework that is exponentially more difficult the second, third, and fourth time through.

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For  information about how to engage workgroups and push decision making down, read about Kaufman Global’s Lean Daily Management System.

Employee Participation: 5 Ways to Boost Engagement

Over the past 25 years, we’ve worked with clients around the world by supporting and / or leading Lean initiatives. If there’s any major “lesson learned” we’ve taken away, it’s that employee engagement is critical to success. Wouldn’t it be nice if there was a magic potion that could be consumed throughout an enterprise to solve problems or improve efficiencies? Unfortunately, it will never be that simple. The rate, degree and level of change for Continuous Improvement endeavors hinges on people.

Within any transformation journey, employees must be empowered and engaged. Improvement happens in the field, on the factory floor, and within the office one employee at a time. When effective leadership support is in place, employees are more likely to embrace change. Without it… Not so much. There must be concentrated focus on active engagement ― connecting employees to the work they control.

It’s well known  that as employee engagement increases, so too does organizational performance. So what are the top, most proven methods for increasing employee engagement? Integro Leadership Institute President Keith Ayers recently identified five leadership skills that are most effective.

#1 Build Trust

Trust is an essential ingredient in increasing engagement. The first thing leaders need to know about building trust is that it does not happen just because you are trustworthy. People do not know how trustworthy you are until you demonstrate it by using trust building behaviors and the most important of these behaviors is to trust others. We build trust by trusting others. This requires a basic belief in people, a belief that people are essentially trustworthy. After all, if you have untrustworthy employees, why did you hire them and why are they still there?

#2 Mentor

The relationship between the employee and his or her immediate manager is a critical factor in how engaged the employee will be. We have to get away from the idea that Managers cannot mentor the people who report to them. Employees need feedback; they need to know how they are performing regularly ― not just once a year at review time. They must be able to discuss their needs for growth and development with a Manager who cares about them. Effective leaders need to give and receive feedback — to coach and counsel employees in a way that increases engagement and commitment.

#3 Inclusion

Whether employees feel like an insider or an outsider also impacts their level of engagement. Effective leaders know that everyone on their team has strengths the team needs, and they know how to get the best out of each person regardless of their ethnic background, gender, age or sexual orientation. They understand that people with different personal values can work together effectively when they commit to the same values about trustworthiness and standards of work performance.

#4 Alignment

Engaged employees feel aligned with their organization’s Purpose, Values and Vision. Their work is meaningful to them because their leader helps them see the connection between what they do and the success of the organization. The effective leader also understands that gaining their team’s commitment to the organization’s values increases the team’s performance standards as well as their engagement.

#5 Team Development

Effective leaders understand the potential for significant increases in performance through high performing teams. They make sure that all team members understand the strengths they and other team members bring to the team and work at developing a process that capitalizes on all of these strengths. The leader’s focus is on developing the leadership potential of each team member and ultimately implementing a shared leadership approach to continuously improve performance that is owned by the team.

Each of the skills above are needed to fully engage employees. In fact, engagement and subsequent results are diminished if any of them are missing.  At Kaufman Global, our implementation approach is focused on linking leaders and employees to change initiatives by providing a structure within which the tools of Continuous Improvement are consistently applied. By applying Lean Daily Management System ® (LDMS ®) and other methods, we generate engagement and ownership. These practices also drive those critically important business results.

To learn more about how to leverage LDMS to improve engagement — and, ultimately, sustainability — click here to download Kaufman Global’s white paper, “Leading Purposeful Change with the Lean Daily Management System.”

See also: Lean Daily Management Services Page.

See also: LDMS blog article.