Lean Six Sigma

Does Lean Create too much Structure? 0

I am a big advocate of standard work, though I might have a different take on it which you can view in this post, Holacracy, Zappos and Standard Work. I always like to get other viewpoint on the subject and in a past podcast with one of my favorite Lean people, Drew Locher, I had one of those conversations. An excerpt from the podcast is below. Drew is currently Managing Director for Change Management Associates.

  Related Podcast and Transcription: Lean Thinking In Service

Joe:  We talked before the podcast about people adapting to Lean because they think that their getting into this real structured situation. Everybody’s got to do this standard work. Everybody’s got to do this regimented process to make it all work and what’s… Is that what Lean is?

Drew:  Well, standard work is a foundation concept of Lean. The quality management folks can appreciate what we are trying to accomplish there. We are trying to reduce variability in the process and then in the result of the process. So that is the foundation concept. That doesn’t mean we make everyone robots. We can allow some flexibility. We distinguish kind of what’s important versus not so important by what we call the key points which are a part of standard work. The key points are nonnegotiable. They’re quality, efficiency and in some cases safety. You’ve got to do them in these ways because we proved they’re the most efficient way. We proved that it is the safest way. We proved that they provide the quality result we’re looking for.

There are a lot of non?key point activities or steps that we can allow some flexibility on. Style, we can allow people to have a different style. We’re not going to make them all robots. They’re not all going to speak the same way and behave the same way. That would be boring in any environment, work or otherwise.

People have to realize that’s not what we’re trying to do. I’ve heard that for 25 years, all the way back to manufacturing days. You’re going to make us all robots. No, that’s really not what we want. People have that misconception. We have to get over that.

They also have to understand the other big purpose of standard work which is to identify nonstandard conditions. How can we identify nonstandard conditions if we don’t have standard conditions to begin with? We’ll forever not know. We’ll be confused. We’ll be for forever not knowing what we need to act on and what we don’t need to act on.

Joe:  I think that’s very true. How do you know where to go if you don’t know where you are? The question that I have in the Lean process, Lean Office and Processes, do we always create standard work. Basically our current state situation and map a future value stream? Is that a common process you take someone through?

Drew:  In general, we start off with value stream mapping. That is our assessment and planning tool. We allow that to tell us where the lack of standard work and what areas we need to kind of focus our efforts on, because there may be constraints or bottlenecks as we discussed earlier. In general we’ll always start with value stream mapping just to assess to make sure we don’t overlook anything. That includes the current state and the future state. Do you always have to do that? No, if you really have a good strong sense that hey, here’s our problem area. Let’s start there.

You can do that, but I always tell companies we would be remiss if we really didn’t assess the overall value stream, the overall system. We may overlook something. So we do encourage that. Sometimes that’s a little strong medicine, stronger than people are willing to accept, in particular when we get into the product development or just development in general processes and systems.

People resist value stream mapping. So I’ve been more recently taking different approaches there that are more of a tools approach rather than a system approach which value stream mapping encourages. Just to open the door, open the mind a little bit that there’s opportunity there. But generally speaking we would encourage people to start with mapping.

Related Podcast and Transcription: Lean Thinking In Service

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Managing Value Streams thru Accounting 0

An excerpt from my interview of  Ross Maynard. Ross has worked as a coach and consultant with a wide range of British and European organizations for over 20 years.

Entire Transcription and Podcast: Managing Value Streams in Lean Accounting

Joe:  I think it makes so much sense of building the organization from the value you provide a customer. Is that how Lean Accounting tries to structure itself?

Ross:  Oh absolutely, yes. In fact, in terms of the Lean measures that we use in Lean accounting, I would always encourage the client to think of what measure of customer value can they build into their value steam accounts. What measure, what is the customer looking for, and how can we measure that in a sensible and timely manner to focus on the customer value aspects. I can give a small example of that if you are interested?

For example; We are working with, I won’t name the company, but a company in the aerospace industry at the moment, an involved engine manufacturer. They were traditionally looking at the cost per product for the pieces that they produce. And then when we began to analyze the customer value aspect, they began to realize that the customer actually values the time that the engines are in the air. They don’t want them to be always being maintained, always having to be checked and refurbished. So they came up with the concept of cost per flying hour as a measure for the value stream. Because in actual fact, you don’t necessarily want to be reducing the product cost of these engine components. You want to be adding value, which is flying hours for the airline companies or the aircraft companies. That can mean a higher cost per part to give more flying hours. That became a key measure of customer value through their value stream.

Joe:  You talk about the key performance indicators. I always look at velocity. Is there a way to measure velocity?

Ross:  Flow, yes. We measure flow through the value stream through a number of measures. In the manufacturing environment, you can measure manufacturing lead time, for example, customer lead time as well if an item is built to order. In a service environment, customer lead time is appropriate. We can also measure the amount of inventory in the process, so raw material inventory, work in progress, and finished goods. The amount of inventory is an indication of the amount of flow time through the process, as you can imagine. So those are areas of measures of flow that we would typically use.

Entire Transcription and Podcast: Managing Value Streams in Lean Accounting

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Standard Work in Lean Services 0

Standard Work is a big part of Lean. But there seems to be a lot of confusion about that in services. Can Standard Work still be a part for the creative type and for services?

I asked Debashis “Deb” Sarka, one of world’s leading lights in the space of Service Lean.

Related Podcast and Transcription: Process Thinking in Services

Sarkar:  “I think that’s an excellent question. I think a mistake many Lean practitioners make is that they believe that, in a service organization, we can go ahead and invent standard work all across it. That’s not the reality. The approach to do it is wherever you have processes which are customer facing, you cannot have a standard work, right. On the other side, if your processes are not visible to the customer, you can have standard work.

Let me give you an example. If you get into a hotel and if you go to the front office, it doesn’t make sense to have standard work for the way you know the front office executive engages with a customer because every customer is different, the queries are different. Standard work would not be of use there. What you need in this customer facing process is a guideline, not standard work.

You don’t need to tell the person to look into the customer’s eye, speak this way, and speak that way because every customer is different. Right their moves are different. For customer facing processes, when you do Lean implementation, please keep in mind standard work should not be pushed. What we should look for are general guidelines. That’s one part but when you look at the back end of it, for example, reservations or maybe the kitchen, of course standard work is important there, and you need to have standard work.

I think the broad guideline that one needs to follow that if you have customer facing processes, you can’t have; you shouldn’t have standard work. But whenever the processes are not customer facing, you can go ahead and have standard work. Let me give you another example. Again this is from financial services. For example if you’re talking about processes in the back office, there you would have standard work. But if you’re talking about relationship management wherein high net worth clients are involved. You can’t have standard work right because customer is different, their requirements are different. So there you will not have a standard work, but you’ll have broad guidelines. How should you approach the customer? What are the do’s and don’ts?”

Related Podcast and Transcription: Process Thinking in Services

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The Power of 3: QFD, Taguchi, TRIZ 1

Dr. John Terninko has integrated his diverse experience base (electrical engineering, operations research, organizational development, teaching, continuing education and management consultation) to develop a unique intervention style for organizations. He has been teaching and using TjohnellendaveRIZ for 13 years. Consistent with his professional life of being on the cutting edge in QFD and Taguchi for 23 and 27 years, respectively, John has integrated TRIZ, QFD and Taguchi in his approach to design problems.

I can honestly say that John’s Step-by-Step QFD: Customer-Driven Product Design, Second Edition book, besides being on Amazon.com’s top 50 Management book list, is the “raggiest” book on my bookshelf.  His Systematic Innovation: An Introduction to TRIZ (Theory of Inventive Problem Solving) (APICS Series on Resource Management) is being used by universities and industry for training. John has been advocating getting out of the office and seeing customer for over thirty years. It was my honor to have him on the podcast.

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If You Want to Think Out of the Box, You Have to Have a Box 1

I fail to see the argument against standard work. This argument even for startups to not develop standard work practices is baffling to me. Now, the first thing I must do is create my box for standard work:

My thoughts about Standard Work:

  • Standard Work should only encompass part of your time.
  • Every person wants some form of standard work. Most enjoy doing tasks that they are comfortable with, and it gives them a sense of accomplishment when completed.
  • Standard Work is what provides line of sight for your team. It enables support and provides an opportunity for managers to serve you.
  • Standardizing your work makes it easier for customers to go deeper into your organization for knowledge sharing. This provides a flood of new ideas for innovation and co-creation opportunities. More importantly, it secures a vendor-customer relationship or partnership that is difficult for others to replicate.
  • Standard Work does not need to be boring

David Mann’s in his book, Creating a Lean Culture: Tools to Sustain Lean Conversions, sums up the definition even better in three words. He asks, “If your standard work can pass the 3 C Test”?

  1. Clarification – Minimum standard is explicit
  2. Commitment – Level of commitment is expected from the individual
  3. Connection – A path for support through conversation is provided.

I have been a longtime fan and practitioner of Franklin Covey’s, The 4 Disciplines of Execution. In 4DEx, they use the term the “Whirlwind”. They describe operating outside the whirlwind to implement breakthrough type improvement. What they encourage is making the same dedication to outside the whirlwind time as you do to your inside the whirlwind time. They feel that you always go back and get caught up in your whirlwind. This promotes and assists with completion of these new activities.

Most of would assume that the whirlwind is standard work. Standard work, of course, is inside the box thinking. Or, is it? Again, if you read my description it is anything but routine work. Standard Work creates the internal collaboration structure needed for learning. Standard Work promotes individual differences. Instead of teaching the way to do some things, you step back and determine the key points that are required, as Simon Sinek says the “Why” while leaving the how alone (Start with Why: How Great Leaders Inspire Everyone to Take Action).

I believe that we need a defined work structure. Not in the sense of a rigid hierarchy or rigid methods but an understanding of this is Why we do things. We will always struggle with the how till we know this.

Holacracy, Zappos and Standard Work

One of my favorite exercises with a new customer is to develop a Business Model Canvas for at least one value stream and often times two at the outset. I seldom (never, but you never say never) do more than two at the beginning. The point of doing this it provides clarity for an ongoing sales and marketing program. This canvas will answer the initial questions that I have and insure the parties to carefully think through what outcomes we want to create, what supports and barriers we need to plan for, and who/when we have to involve others within the organization to guarantee success. You could say that the Business Model Canvas creates the box.

Business Model Canvas was made popular by Alex Osterwalder in his book, Business Model Generation.

It is the basic understanding of your business model that you must have to provide autonomy for your decision making. Even for a startup, till this process is completed it is very difficult to call it business and maybe even innovation, it may only be an idea. Creating the box is imperative for future development. As Taichi Ohno said, “without standards there can be no kaizen (improvement).

Paraphrased: If you want to think out of the Box, You have to have Box

I recommend for understanding and developing a canvas for a startup is Ash Maurya’s book, Running Lean. 

I am a big believer in developing from the core (your box) which I outline in this free eBook: Lean Scale Up.

The title I read somewhere, and it always stuck with me. I have no idea whom to attribute it to and searched the internet but failed to find the exact quote.

Strength Based Approach to Lean and Six Sigma 1

David Shaked of Almond-Insight  discusses his book, Strength-Based Lean Six Sigma: Building Positive and Engaging Business Improvement. in a podcast last fall but it was actually the 2nd time David appeared on the podcast. The first time served as a great introduction to me on his Strength Based Approach to Lean and Six Sigma.

In this podcast I asked David what does Lean & Six Sigma have in common with Appreciative Inquiry, the conversation went like this:

Joe:  Well, it seems like Lean and Six Sigma is driven by problem solving and looking for problems, and Appreciative Inquiry is saying, “No, no, no!” “Let’s look at the good things.” What do they have in common?

David:  They actually do have a lot in common. In the journey that I went with AI and then, later on with other Strength-Based tools, it took me a while to be able to merge the two things. But what they do have in common is the desire for improvement. Also, if you look at some of the principles of Lean, for example, or the mission that is behind Six Sigma, the principles in Lean would like to see the flow. You would like to see value to customer. You’d like to see pull versus push. You’d like to see continuous improvement, and Six Sigma is all about quality. All of these things that I’ve just said are very positive.

They’re not in complete misalignment with AI. AI is also very positive oriented. What confused me initially and what might confuse others is the language we use, or the ways we use, the approaches we use to get there. In Lean Six Sigma, I would actually analyze the defects or the wastes in order to get to value and quality.

Whereas in AI, I would actually look at where are we already creating value or where do we already have some quality? Then, build on that. If you actually look at the end result of what we are trying to drive, you’ll see that they’re very much aligned. It’s only the road we take to get there, which is different.

Transcription and Podcast: Strength Based Approach to Lean and Six Sigma

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The Blend of Appreciative Inquiry and Lean 0

Ankit Patel, principal partner with The Lean Way Consulting firm while doing some work with the Cleveland Clinic, discovered Appreciative Inquiry and saw an opportunity to blend it with his work in Continuous Improvement. I had a podcast with Ankit and you can access the podcast and entire transcription: Blending Appreciative Inquiry with Lean.

In the podcast I asked Ankit: Can you give me examples of some of the questions that I might use to lead into an encounter, or lead into a process and take more of a positive approach when we start out?

Ankit:  Sure, absolutely. I’ll give a couple examples. I use a lot of AI with strategy. One of the approaches with strategy, I did an AI initiative with an organization here called the Organization Change Alliance, and what I asked them was…well, first off, what they were looking to do was grow their organization. They’re a non?profit association for org development. What we did was we said OK, let’s take a…here’s a three set of questions that we want you to answer to do some initial data collection, just with the board. And so what we said was, the first question, what is it that attracted you to the OCA, which is called the Organization Change Alliance, what attracted you to the organization? They would all talk about it, and they’d pair off in their views.

The second question is OK, what do you think is happening that’s just fantastic, and we’re just knocking out of the park, and you want to see that continue into the future?

The third question there would be OK, let’s imagine you fell asleep, and you wake up 10 years later and the OCA has grown beyond your wildest dreams, everything you ever imagined is in place. What does it look like, and what are some of the steps that the organization took to get there?

What you’re doing there is building successes off the past, and isolating core factors that are really working well, and then building a vision of the future. When you get folks thinking in terms of that, they start getting more hopeful, they get more engaged; they get more passionate to drive forward.

Another example would be, let’s say you’re working more on a profit level. I’m working with a client at an IT service company, and one of the things they’re looking at is speed of closure. They’re an IT recruiting firm. They want to reduce the time it takes from the time they get a rec, a requirement, or a job, and the time it actually gets filled.

One of the questions that we would ask to the recruiters is, Tell me about a time when you had just expedient customer service and closure of a job that you had on the table.” We asked them that question and started getting ideas.  Let’s talk about that experience.

Then the next part of that question might be something like ?? well, there’s a couple parts, but one of the parts was, “If you had to bottle the top five characteristics of what made that experience so great, what would you put in that bottle?” Again same concept there, trying to isolate the factors.

The third part is looking into the future of designing, what it would look like if everything was like that top experience that you experienced, that you went through.

The basic format is: what worked well in the past, what are the key factors in how you design a future around those factors. That’s just an initial starting point, though. So, it’s a very integrative process. Each situation is different. With the OCA, the Association, we’ll actually be going back and drilling down into some more specific topics. We’re going to ask those topics in a bigger session with both members and also non?members that we would like to become members to get their feedback on how to improve.

With the IT recruiting firm, the service-based industry, what we’re going to do is actually take those pieces that we found, and once they’re finished we’re going to integrate them into some process change recommendations, and we’re going to start bringing the team back to the table and say, “These are some things we thought of. Now how do we go and do this moving forward?” Things like; we need to standardize, and we need to change our prioritization matrix. Those type of things.

Transcription and Podcast: Blending Appreciative Inquiry with Lean

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