Author: Mark

Posted on

Why I Don’t Like Two-Bin Systems

On the surface, a “two bin system” seems a great, simple solution to a part resupply process that could otherwise get complex.

And, on the surface, I don’t argue with that.

But two-bin has some limitations. And because it is so simple to set up, those limitations are frequently not understood or taken into account.

What is “Two Bin?”

Although it may be obvious to all, I want to define “two bin” to reduce the chance that what is “obvious” is actually less so.

“Two bin” is a simple pull system. The parts are supplied by two rotating containers. When a bin is empty, it is returned to the supplying process to refill. The second bin supplies parts while the first one is being filled.

The same system can be applied to things much bigger than “bins.” I have seen carts carrying fabricated steel parts weighing many hundreds of pounds set up the same way.

When does it work?

In general, two-bin is OK when two criteria are met:

  1. The parts are relatively cheap. That is you don’t worry too much about having more than you actually need. This comes with a warning, however. It is easy to have a ton of money tied up in relatively small excesses of hundreds of parts. It does all add up.
  2. This is critical: The time to replenish and return a full bin is short compared to the time to use the parts contained in a full bin.

In this scenario, the first bin is empty, and long before the Team Member has emptied the second bin, the first one is safely returned and is behind it on the shelf.

So What’s The Problem?

There are problems at two levels. I am going to emphasize the practical one, then talk about the philosophical one.

At The Practical Level

First, let me explain how this system would work if it were being done with kanban cards as signals.

One of the rules of kanban cards is that the card is removed from the container when the first part is consumed. That is, the container is NOT empty.

In this type of system, the number of containers circulating is +1 over the number of cards circulating. If you think about it, this makes sense. Let’s say there are five cards circulating, and the container size is 10. If all of the full containers were on the rack, and one part is used from the first container, then the rules state that the card is removed and signals bringing another bin.

If production stops at that point, the worst-case scenario of kanban is realized: The card is returned with another bin of 10 parts. There are now 5 full bins on the shelf, each with a card attached, plus the one bin of 9 parts.

What this has to do with two-bin: Two bin is mathematically identical to a one-card kanban loop.

At a practical level: Do the math for kanban. If your system, with your replenishment quantity and times won’t work with one kanban card, a two-bin won’t work either.

At a Philosophical Level

The problem comes in in practice. Two-bin is easy to set up, and frequently the people doing so don’t do the math. And it usually works.

What results is a pull system that has locked down the number of circulating containers (two), and if there are perceived problems the reflex is to alter the quantity of parts in each bin.

If the system is running a little close to the edge, the materials people will up the parts quantity per-bin from, say, seven parts to ten parts.

Then the system fails.

Why?

With kanban, you signal for replenishment when the first part is removed from the bin. Having more parts in the bin means it takes longer to empty the bin. Your supplier has more time to return with a full bin.

With two-bin, you signal for replenishment when the last part is removed from the bin. Having more parts in the bin means it takes longer to empty the bin. Adding more parts to the bin delays the notification to your supplier that you have started using parts.

While it doesn’t always happen, there are cases when adding even a few parts to the bins will cause two-bin to fail because of this.

No matter what system you use, you must thoroughly understand how it works, why it works. You must think through (and try) every step of the process, not just talk about it.

You must ask questions and understand every detail:

  • If there are hundreds of bins, and they all have part-specific labels, how will they be sorted and routed to the appropriate supplying process?
  • How will the bins be used to visually manage the replenishment process?

These are questions with obvious answers in card systems (that use generic bins), but are frequently not well thought through in the rush to implement the “simpler” circulating bin systems.
Also keep in mind: If you are not constantly monitoring actual use, execution and results against your assumptions and expectations of what should be happening, you might be using pull, but you are not applying the Toyota Production System.

So?

  • Go ahead and use two-bin if you want to. Just do the math and make sure it will work for you.
  • However, if you use cards, or other signals, anywhere consider the complexity you are introducing with more than one system. The rules are different depending on the parts. Remember, you are asking your customers to keep track of all of this.
  • Generally speaking, if your system is operating close to the edge, it is better to use more containers that are smaller. Things will circulate more quickly, and your supplying process will have a much better picture of your consumption patterns.
  • Remember – your objective is to move closer to single-piece-flow. If you move away from that (with bigger containers) you are doing the opposite of kaizen.
Posted on

Adventures in Airline Travel

Today I flew from my home in the Seattle area to New York’s La Guardia airport. This seems to nearly always be an adventure, but this one was unusual, so I wanted to comment on the customer’s perspective.

The flight routed through the airline’s major hub in Minneapolis (MSP) (so now you know which airline if you fly at all). No sooner than I had turned my cell phone on at the gate at MSP than it buzzed. I answered, and it was the airline’s computer talking.

I was informed that my flight from MSP to LGA had been canceled. This is never good news. I was informed that I had been re-booked on another airline (Midwest), and to contact the gate agent before going to the other airline’s counter. I was read a confirmation number, though sitting in an airline seat I really had no opportunity to write anything down, and was informed that all of the details were available on the airline’s web site – which is really no help unless I am on line in the airport. No big deal.

The gate agent is polite, lets me know that the other airline is “way over in Humphrey Terminal” and suggests another flight into Newark. “No, that’s OK, I want to go to La Guardia.”

I was much more concerned, at this point, about my luggage. Airlines, in general, do a reasonably OK job recovering from these things and getting people where they need to go. As a group, however, they don’t seem to “get” that it is important to the passengers (at least important to this passenger) that the luggage get there more or less at the same time I do.

I was cheerfully told that my luggage would be on their next flight to LGA, and I could pick it up “at my convenience.” This choice of words was interesting, it implied that I would easily just head back to the airport when my luggage got there.

One of the blind spots of all airlines is the illusion that the airport terminal is the final destination. Their job ends once they unload you there.

My only other option was to fill out a “missing luggage” claim with the secondary carrier (since they are responsible as the last airline I flew on), then they would get with the original carrier, arrange delivery to the hotel, etc. I pretty much resigned myself to having to go through that nutroll, and hoping beyond hope that it would get to the hotel overnight so I didn’t have to show up at Corporate HQ in “Seattle Casual.”

(I should relate the story of lost luggage when I had an 18 hour stay in Berlin sometime…)

Midwest Airlines flight 5 from Minneapolis to La Guardia stops in Milwaukee. When we arrived, we were informed this 30 minute stop was going to be a 2 hour stop due to “weather delays” in La Guardia. Not sure what that was about, the weather in La Guardia is beautiful tonight, but whatever. We actually got “release” after 1 hour, got on the plane, and headed east.

One thing I have to say – Midwest has a nice little niche service, and features “the most comfortable coach seating in the industry” by their claim. The seats certainly are nice, and I can’t complain about warm, gooey chocolate chip cookies either.

When I got to LGA, I thought “what the hell”, grabbed the shuttle bus and headed over to the NWA terminal to just see if they even knew where the luggage was. I arrived, was walking toward the luggage service office and there, coming out of the conveyor was my suitcase. How the hell that happened, I will never know. I picked it up, headed out of the terminal, caught the shuttle to the rental counter, waited behind the couple who could not rent a car because HE had the credit card and SHE had the driver’s license, got my car, and here I am.

Short Story: Somtimes good customer service happens purely by accident. It shouldn’t, but sometimes it does. Of course, the airline industry does a very good job of managing my expectations (i.e. keeping them low). I am always pleasantly surprised when they manage to deliver what they minimally promised.

Note To The Airlines: I try to not be one of those people who abuses the carry-on rules. If I have too much stuff, I check it. However – as a customer, it is important to me to arrive with my luggage. Sometimes that it more important than getting to the destination as soon as possible.

Posted on

Really Long Takt Times

One question I see coming up a lot in various forums is how to deal with issues unique to very long takt times. By “very long” I usually hear about many hours, sometimes days, occasionally weeks. Because it comes up fairly often, I thought I would take a shot at addressing it here.

I think the biggest hurdle for people to get over is the issues are largely the same as shorter takt times. They are just harder to see because the work starts to lose a human time scale. The trick is to get it back onto a time scale that people can relate to.

By this I mean that a person, generally, loses a sense of how long something is taking once it goes beyond a dozen minutes or so. In contrast, the stereotypical automobile line has a takt of about 60 seconds. Once an auto assembly worker loses 3 or 4 seconds of time, there is really no way she will be able to complete the programmed work cycle without help or stopping the line for at least a few seconds.

As work cycles get longer, though, the work remaining until “done” gets more and more disassociated from “now” and the idea of the necessity to maintain a particular work pace becomes abstract. This is less of a technical issue than one of human psychology. People, in general. tend to believe they can finish something in time long after that is no longer true. (Ask any college freshman working on a term paper.)

The countermeasure is the same as a manager would apply to any long project: milestones.

When the takt times are relatively short, the “milestones” are the takt intervals themselves. Each takt time signals a stage of work that must be complete. If this is not true, the line will (should) be stopped at that point. (Remember – “Never pass along a defect” and this includes incomplete work.) The problem will be corrected, and the cause understood. Oh – actually this is not quite true. A Toyota assembly line has the work zone divided into 10 sub-intervals, and the worker has a good idea what work should be completed at what point.

However, since most of us are likely just beginning – If your takt time is longer than a couple of dozen minutes, then, define the work in stages. In one operation I suggested the following:

Take about 85% of your long takt time, and divide that into quarters. Define what job should normally be complete by the time each of those check points comes up. As an example – if the takt time was 100 minutes, then determine the expected work completion at 20, 45, 65 and 85 minutes. Give the Team Member a way to know where he is at that point vs. the expectation, and a way to call for help if he is off by even a little bit. He should also call for help before that point if he is disrupted by something that he knows will cause a delay.

This is just a starting point to start to stabilize the system and build your support structure. If you reach the point where things are running smoothly at this level of granularity, then cut those time intervals in half.

At each point you will find more problems. The problems are likely to be smaller, but there will be more of them. All of those problems are sources of friction, and therefore wasted motion and time, on your system.

BUT – before you start down this road, have a few things in place first.

  • Establish credibility for the concept that you are genuinely doing this to see problems that are making the worker’s jobs difficult. If you use it, just once, to initiate a negative consequence for “not working fast enough” then forget it.
  • Actually work the problems. This means work them to eliminate the causes. Put in a process for managing the problems, make it visible so that the people working can see you are working on them. Again, this is to maintain credibility. If problems get recorded and sunk into a black hole (like a database in a computer somewhere), then you are not assuring the people on the line that you actually care.
  • Build your immediate responses (escalation) system. This mean team leaders (first responders) who can, and do, respond to help calls quickly. The only thing worse than having no way to call for help is to call and have no one respond. Again, the system loses credibility after about the third andon pull with no response.
  • Don’t worry too much about every detail within the work interval. The important thing, at first is to make sure that the same things get done within that interval. Detailed sequence standardization will come in time.

Summary: The key to managing really long takt times is to break the work into time-based intervals, and manage to those, rather than the entire work cycle itself.

Posted on

Systematic Problem Solving

If I were to look at the experience of the organization profiled in the last three posts “A Systematic Approach to Part Shortages” I believe their biggest breakthrough was cultural. By applying the “morning market” as a process of managing problems, they began a shift from a reactive organization to a problem solving culture.

I can cite two other data points which suggest that when an organization starts managing problem solving in a systematic way, their performance begins to steadily improve. Even managing problem solving a little bit better results in much more consistent improvement and less backsliding. Of course my personal experience is only anecdotal. That is certainly true by the time you read it here as I try to filter things. But consider this: The key difference with Toyota’s approach that Steven Spear pointed out in “Decoding the DNA of the Toyota Production System” (as well as his PhD dissertation) was that the application of rules of flow triggered problem solving activity whenever there was a gap between expected and actual process or expected and actual outcome.

Does this mean you should go out and implement morning market’s everywhere? Again, based on my single company data point, no. That doesn’t work any more than attaching kanban cards to all of your parts and calling it a pull system. It is not about the white boards, it is not even about reviewing the problems every day. Reactive organizations do that too. In most cases in the Big Company that implemented morning markets everywhere, that is what happened – they morphed into another format for the Same Old Stuff.

Here are some of the things my example organization did that I think contributed to success in their cultural shift.

  • They separated “containment” and “countermeasure” as two separate and distinct responses. This was to make sure that they all understood “containment” is what is done immediately to re-start production while preserving safety and quality. “Containment” was not a countermeasure as it rarely (if ever) actually addressed the root cause. It only isolated the effect of the problem as far upstream as possible. The rule of thumb was simple:
    • Containment nearly always adds time, cost, resources, etc.
    • A true countermeasure nearly always removes not only the containment, but reduces time, cost, resources.
  • They didn’t use the meetings to discuss solutions. They only addressed two things:
    • A quick update on the status of ongoing problem solving.
    • A quick overview of new problems from yesterday.

I think this is an important point because too many meetings get bogged down with people talking about problems, and speculating what the causes are. That is completely non-productive.

  • The actual people working on problems attended the meeting. I cannot over-emphasize how important this is. They did not send a single representative. Each person with expected activity reported his or her progress over the last 24 hours. It is difficult to stand in front of a group and say “I didn’t do anything.”
  • They blocked out time to work on problems. I probably should have put this one first. The manufacturing engineers and other professional problem solvers agreed not to schedule anything else for at least two hours every morning. This time was dedicated to working on the shop floor to understand the problem, and physically experiment with solutions. There was a lot of resistance to this. But over a couple of months it became close to the norm. It helped a lot because it started to drive the group to consider where they really spent their time vs. what they needed to get done. There was no doubt in the past that solving these problems was important, but it was never urgent. Nobody was ever asked why they weren’t working on a shop floor issue. That had been a “when I am done with everything else activity.” Gradually the group developed a stronger sense of the shop floor as their customer.
  • They didn’t assign problems until someone was available to work on them. This came a little later, when the problem-solvers were missing deadlines. The practice had been to assign a responsible person in the morning when the problem was first reviewed. Realistically a person can work on one problem a time, and perhaps work on another when waiting for something. They established a priority list. The priority was set primarily by manufacturing. When a problem-solver became available, the next item on the list was assigned. Once a problem was assigned, nothing would over-ride that assignment except a safety issue or a defect that had actually escaped the plant and reached a customer.
  • They got everyone formal training on problem solving with heavy emphasis on true root cause. People were expected to follow the method.
  • A problem was not cleared from the board until a long term countermeasure had been implemented and verified as working.

By blocking out time, they were able to establish some kind of expectation for productivity. After that, if problems were accumulating faster than they were being cleared, they knew they had a methods or resource issue. The same was true for their other tasks which were worked on during the rest of the day.

This was the start of establishing a form of standard work for the problem solvers.

21 Oct 08 – There is more on the subject here and here

Posted on

A Systematic Approach to Part Shortages – Part 3

The third element of this organization’s successful drive to eliminate part shortages was a systematic approach to problem solving. They made it a process, managed just like any other process, rather than something people did when they had time. Even though this is “Part 3” of this series, in reality they put this into place at the same time, and actually a little ahead, of kanban and leveling.

The Morning Market

The idea of the “morning market” came from a chapter in Imai’s book “Gemba Kaizen.” He describes a process where the previous day’s defects are physically set out on a table and reviewed first thing in the morning – “while they are fresh” hence the analogy to the morning markets.

This organization had been trying to practice the concept of a morning market for a few weeks, and was beginning to get it into an actual process. Because supplier problems constituted a major cause of disruption, they set up a separate morning market for defective purchased parts.

That process branched yet again into a morning market for part shortages. And this evolved into a bit of a mental breakthrough.

They started looking at process defects.

Every shortage, every day, was recorded on the board.

Each morning the previous day’s shortages were reviewed. They were grouped into three categories based on knowledge of the cause – just like outlined in the book.

  • “A” problems – they knew the cause, knew the countermeasure, but had some excuse reason why it could not be implemented right away.
  • “B” problems – they knew the cause, but did not have a good countermeasure yet.
  • “C” problems – knew the symptom (parts weren’t there) but didn’t know why.

The mental breakthrough was systematically investigating the reason each and every shortage occurred. What they found was that in the vast majority of cases it was an internal process breakdown, rather than some problem at the supplier, that caused the shortage. This was a bit of a revelation.

They began systematically fixing their processes, one problem at a time.

Over time things got better. Simultaneously they were implementing the kanban system. Kanban comes with its own set of possible problems, like cards getting lost. Once again, when they found problems they went into the morning market and were systematically addressed.

After a few months into their kanban implementation, for example, they started turning in card audits with far less than 2% irregularities, and then it was not unusual for a card audit to find no problems at all. Why? They had addressed the reasons why cards end up somewhere other than where they should be. Instead of blaming people, they looked for why people acting in good faith would not follow the process.

This was also an attitude shift – assume a flaw in the process itself, or in communication, before looking for “who did it.”

Eventually the warehouse team had their own morning market. As did the receiving team. As did the parts picking team. As did assembly. Each looked at any case where they were not able to deliver exactly what their downstream customer needed.

About 8 months into this, another group in an adjacent building, was trying to work through their own issues. They came over for a tour. One of the supervisors, visibly shaken, came to me and said

“Now I get it. These people work together in a fundamentally different way.”

And they did. They worked as a team, focusing on the problems, not on each other.

And that, readers, is the goal of “lean manufacturing.” If you aren’t working toward that, then you aren’t really implementing anything.

Posted on

A Systematic Approach to Part Shortages – Part 2

For kanban to work well, there has to be a solid foundation under it. That foundation is production leveling or heijunka.

Before I get to far into this, though, I would like to point something out: At the mention of leveling, people who are only just learning about kanban will point out all of the good reasons why leveling is difficult. Here is a key point: The problems caused by running kanban without good leveling pale in comparison to the total chaos that ensues if you try to run MRP without leveling. I’ll stay out of that little rabbit hole until another day though.

Production leveling has two parts.

  1. Leveling the production volume.
  2. Leveling the production mix.

The operation I described in Part 1 was relatively small, so it was a simple matter to set up a totally manual system to do this. By small I mean they had two major assembly lines running at a rates on the order of 10 units / day. The product was about the size and complexity of a medium to large-sized photocopier (though not a photocopier). The assembly lines had about half a dozen positions each. There were several hundred parts from about as many suppliers. (Different story.)

The objective in leveling volume is for the production line to see demand as an image of the takt time, and to protect that signal from variation in actual orders and shipping. At the same time, the shipping dock was to see deliveries to the finished goods buffer at takt time, regardless of minor and medium problems in production.

To accomplish this they separated the “big lump” of inventory that typically existed in shipping into two physically separate buffers.

The Withdrawal Loop

Customers, unfortunately, rarely order at takt time. The purpose of the buffer in shipping was to absorb this variation and make the actual demand appear as if it arrived exactly at takt. The organization also tried to take out some of the bigger spikes in customer orders by working with dealers to get more transparency into actual customer order patterns; as well as trying to level actual promise-to-ship dates at least weekly if they couldn’t get it to daily. That helped a lot. A more sophisticated order entry system would have worked better, but that luxury wasn’t in place yet.

Back to the buffers. Each unit in shipping had a withdrawal kanban card attached to it. As orders were released, a unit would be pulled from this buffer and shipped. The withdrawal card went back to the production control department. Those cards were placed in the inventory management box. This box had series of slots that indicated authorized inventory levels. A card in one of the slots indicated inventory we didn’t have, an empty slot indicated inventory on-hand.

There were limit markers at near each end of the row of slots. As long a the end of the row of cards stayed between those limit markers, everything was regarded as OK. They did not try to chase a particular level of inventory with production.

The scheduled production rate was 10 units / day.

Each morning Production Control would take 10 cards from their box and put them into the leveling box in shipping. That box had slots that corresponded to times of day. The cards were evenly distributed at the takt-time interval. As that time came up, shipping would take the withdrawal card from the box, go to the end of the production line, attach their card to a unit, and move it to the shipping buffer.

This seemed like a lot of trouble, but it served a purpose. It was to hide the irregularities of shipping schedules and actual order dates from assembly. They saw a clean, paced signal exactly at takt time. The process was designed so that assembly saw a perfect customer, even if the customers were far from perfect.

If management didn’t like the size of the shipping buffer, they knew exactly what problem(s) must be solved to reduce it – they needed to improve the dealer ordering and management processes so dealers would stop using deep reorder points and ordering weeks worth of product at once.

The Production Loop

When units were withdrawn from the end of the line, they were actual pulled from a FIFO buffer. In this case, the buffer held about 4 hours of production. Why? Most problems in production were cleared within that time. Only a bigger problem would starve the buffer and affect the withdrawal loop. Thus the purpose of this buffer was to make assembly appear as a perfect supplier to their perfect customer. They could supply exactly at the agreed-upon takt time.

Each of these units had a production kanban card attached to it. When shipping came to pull a unit, they would pull the production card and leave it in a kanban post. They would attach their withdrawal card and take the unit. Thus switching the cards transfers ownership of the product from one loop to the next. Since a kanban card authorizes a specific quantity to be in a specific location, if someone wants to take something somewhere else they need to attach a card authorizing them to do so. That was the case here.

The production cards went to the front of the assembly line. There were three slots there. One green, one yellow, one red. If everything was running smoothly, the card would go into the green slot, and when the next unit was started, the card would be pulled from the box and attached to the unit.

If the line were a little bit behind, there might still be a card in the green slot. Then the next card would go into the yellow slot. This would automatically signal the assembly manager that there was something that needed some attention.

The next card would end up in the red slot. This was the point when, if they weren’t already there for a known problem, they were in “line stop” mode. Anyone who could be helping to clear the problem should be helping to clear the problem. Why? The money machine has stopped running. Everyone is now being paid only because the shareholders are lending them money. The idea is to get the money machine running as quickly as possible, and it is the most important thing. This was a simple phased escalation process, and was part of their overall andon / escalation system.

Did it work?

All I can say is that it worked a hell of a lot better than what they were doing before. It took two or three serious tries to get this into place and keep it working, and they probably fell off the wagon a couple of times after that. There were always immense pressures to “reduce inventory” at the end of the quarter, for example, which would have management directing to starve out the shipping buffer, or push it out early. But, in general, when it was working, overtime was lower, things were more predictable, problems were identified very quickly.

But…

Yes, it looks like a lot of manual work involved. But I want to be really clear – the total time spent moving all of these cards around was a fraction of the time that had previously been spent investigating status, working action messages, making calls to find out what was happening, etc, etc. For some reason people seem to think that deliberate activities raise the total amount of labor involved, and that somehow, the time spent running after information and chasing problems is free.

Setting a standard and following it injects an element of stability and calm into an otherwise chaotic workplace. Once this basic foundation is in place it is far easier to improve overall efficiency because now there is an actual process to improve.

Posted on

A Systematic Approach to Part Shortages – Part 1

The short story of assembly problems is lack of parts. Part shortages drive all kinds of waste, including: juggling the schedule; expediting; bigger lots or batches – and all of these things end up causing shortages later on in a self-reinforcing death spiral.

So how did an assembly shop which built about 10 units / day, and suffered between a dozen and 20 line-stopping part shortages a day end up eliminating all but a few (3-5) a week?

Three things, more or less at the same time. This post talks about the first:

Implement a kanban system to replace MRP ordering. They systematically studied how kanban is supposed to work, and, over a few months, put in a kanban system which I am proud to say was really pretty good. The assembly line was fed by kit carts which were picked at takt time from a small supermarket on the shop floor. The supermarket held a day or two of parts. The parts with local suppliers were replenished right from the receiving dock. Parts which had to still be purchased in larger quantities were stored in a warehouse area, and the shop floor supermarket was replenished from the warehouse daily.

The daily warehouse replenishment established the concept of isolating the problem. Their daily replenishment allowed them to set up the shop floor supermarket as if all of their suppliers were delivering daily.

All parts in the shop-floor supermarket and the warehouse were under kanban control. This means they had kanban cards physically attached to the parts (if they were separate) or the containers.

Some things they learned over time:

  • The rules of kanban state that the card should be pulled and placed in the post when the first part is removed from the container. The quickly learned this was far more likely to happen if they secured the card in a place where it was in the way of either opening the container (over the folding lid, for example) or had to be moved (e.g. picked up) to get the first part out. At that point the card is in the person’s hand and he has to put it somewhere.
  • The number 1 reason for lost cards was that “put it somewhere” was a pocket.
  • The number 1 reason why the card ended up in a pocket was that the kanban post was more than a step away from the place where the card was pulled. That meant the person put it in the pocket “for a second” while he got the parts.

In the above case the countermeasure was simple. Put kanban collection points everywhere where parts are handled.

  • The first time they tried putting a pull system in for parts ordering they hadn’t put in heijunka (production volume and mix leveling) first. That was a problem, and “problem” is an understatement.

The countermeasure was (obviously) to simultaneously implement a schedule leveling system to drive the upstream system at takt. More about that in Part 2.

  • They invariably had some parts where they had more than they needed.

The countermeasure was “black cards” (though I would have preferred bright orange cards) that signified “excess inventory.” These cards allowed them to maintain kanban control of all inventory, but they did not signal replenishment.

When a card was pulled, the shop floor coordinator would scan a barcode on the card. This scan triggered an order release to the supplier, and authorized the supplier to ship the indicated quantity.

Actual card from this organization being scanned.
Actual card from this organization being scanned.

They had agreements with the suppliers that there would be an email acknowledgment of the order within 2 hours. When the card was scanned, it was placed in a slot labeled with the time when the acknowledgment was expected. When (if) that time passed and the acknowledgment had not been received, the card went to the buyer who phoned the supplier. “Did you get my order? I need the acknowledgment within 2 hours like we agreed.”

This served two purposes. First, it verified receipt of the order and eliminated a known cause of shortages. Second it “trained” the suppliers that this time the customer actually expected them to honor the agreement. They really didn’t want that call from the buyer who had better things to do.

Once the acknowledgment was received, the card went to the receiving dock. Here it was placed in a slot that indicated the day (and later on, the time window) when those parts were supposed to arrive.

Like the above case, if the time passed, the card went to our poor hapless buyer. He phoned the supplier with a simple question: “Where’s my parts?”

This reinforced that, once again, there was an expectation to honor agreements. They really didn’t care that much (at this point) what the supplier’s lead time was. Only that it was honored. The main objective when starting out was simple consistent execution.

When the parts came in, the card was retrieved, matched with the order to verify, then scanned again to trigger a receipt transaction. If there were exceptions – guess what – another phone call.

The card was then attached to the container. Since the card specified the storage location, put-away was fairly straight forward. No location lookups required.

The previous condition had been that there was no matching of receipts against expectations. Thus if parts were late, or didn’t show up at all, no one noticed until they ran out. Big problem. By trapping and surfacing problems at the two main failure points in the system, most of those problems went away after a few months.

For the purists who are reading – yes, this process has some compromises and probably is a bit obsessive on checks. Call those training wheels until there is a sense of balance. All I can say is that it worked and, in the long run, ended up to be a lot less work than chasing down and expediting shortages all day.

Posted on

Team Preparation for a Shingijutsu Seminar

If you are planning on attending (or sending people to) a Shingijutsu Seminar, I have a word of wisdom: Prepare.

Just sending people cold and expecting great things from the experience will, at best, give you a fraction of the potential learning. At worst it can turn people off completely. Here is a little advice:

Read my post on “Getting a Plant Tour“

Everything there applies here. Don’t be “industrial tourists.”

Groups are Better than Individuals

Even two people together are better than one alone. Not to say that an individual is going to get nothing, but when there are others to debrief the day and share learnings I think that interaction contributes a great deal to quality of the experience. It also provides a degree of insurance against the possibility of being assigned alone, or with a handful of “singles” to a large team composed of people from the same company. While that is by no means a disaster, it is probably a little easier if there is some assured mutual support rather than counting on finding it there with people you just met – and who may have their own rigorous agendas.

The Basics

It is important to have an certain level of comfort with the basics:

  1. Understand the fundamentals of standard work.
  2. Know how to use a stopwatch and a time observation sheet.
  3. Know how to build a standard work combination sheet, and what it is for.
  4. Understand what takt time is, what cycle time is (and the difference).
  5. Know how to build a work balance chart.

They teach all of these things in the first day lecture, but (trust me) the more you know before you get there, the better you will be able to follow what they are teaching.

A Theoretical Base

Once again, the more you know before you go, the better. Even if you are working a complete implementation, it works well if your team is focused on a specific aspect of learning. Since everything in the system is inter-connected anyway, this does not limit your experience, it just focuses it.

Whatever your chosen topic, have the team members to some research and study, make presentations, and generally gain a level of understanding. This will help everyone make sense of what they see and hear in Japan since they will at least have a context for it.

Touring Toyota

Generally, one of the features of these trips is a tour of a Toyota plant. The tour is the same 50 minute tour everyone gets, there is nothing special. In fact, on this last trip, we were asked to leave our Shingijutsu name tags and any Shingijutsu-specific materials on the bus – not sure why, but I can speculate.

Rather than everyone just getting the tour, here is how to make the most of it.

Assign four sub-teams. Each one is focusing on a specific aspect of what you will see.

  1. Standard work / the flow of people.
  2. Pull and the flow of materials.
  3. Tools and gadgets that make the work easier, assure quality (poka-yoke) – technical kaizens
  4. The flow of problems – the andon system and the response.

It is good to get the theoretical base in these things before you depart, so people have some idea what to expect. This is the Plan of Plan-Do-Check-Act. They are establishing a “should be happening” in their minds. Doing so will focus their observations. Whatever they see will either confirm what they think should be happening, or will contradict it. Either way, they will remember much better.

After the tour, each sub-team should debrief themselves, then report to the larger group what they saw and what they learned.

Note that this doesn’t mean that people focused on, say, kanban would ignore andon and line stops. Quite the contrary. The system is highly inter-connected. But having focus helps people see.

Get a Custom Experience

This is a bit of an advanced topic, and perhaps is a little redundant. I say that because if you know how to arrange this, you already know what I am going to say here. The boilerplate seminars are probably not the best solution if you know what you want. If you have a client relationship with either of the Shingijutsu’s, they have proven agreeable to setting up a custom experience. This is especially true for top-level leadership teams and advanced topical training.

Shingijutsu is not the end-all

It is true – Shingijutsu, especially some senior individuals, can be a challenge to deal with. There are other consultants today who have the connections and contacts to arrange the “Japan” experience. I have no personal experience, so cannot specifically advise, but some have quite good reputations. Still, I would strongly advise performing your due-diligence, and ensuring you still have good preparation. I would also advise having someone on your staff, or someone you trust, who knows the business do some of the vetting for you.

Another option is that there are independent consultancies who have relationships with Shingijutsu. Frankly, mere association with Shingijutsu, and even using “Shingijutsu” in the name does not assure quality or competency, but they are out there, have the relationships, and might be able to get you started.

Posted on

Thoughts from Nagoya: Japan, Toyota, Shingijutsu

Nagoya Castle

This last road trip was 3+ weeks in China, then a week at the Shingijutsu seminar in Japan. It was a little fortunate for me since I was the only member on our team who was not suffering from 8-12 hours of jet lag.

As I noted at the start of the Shingijutsu Seminar series, Shingijutsu Co. split along factional lines a few years ago. I did not get an opportunity to get into details with anyone I know who would tell me, maybe I will inquire about the juicy details later on through correspondence. Anyone who does know is welcome to comment below.

Nakao-sensei’s group is now based in Nagoya and has a USA office in Portland, Oregon. They call themselves “Shingijutsu USA.” The other Shingijutsu goes by “Shingijutsu Global Consulting” and is headed up by Niwa-Sensei. Although I have no personal experience with this organization, I have some reliable second-hand information that they are a little much better at organizing the seminars and training activities. I also get anecdotal information that there remains a great deal of bad blood between the two groups, though some of that is egos and personalities of certain individuals who need not be named as if you care, you know who they are.

One of the interesting things we did on Thursday after the report-out was visit to the Nagoya office. The feature is stand-up desks made from the modular tube structure available under several different names. The same material is used to make racks and carts at Toyota as well as many other companies, but this is the first time I have seen it used to make office furniture. I will let the photos speak for themselves.

Shingijutsu Office Tour Shingijutsu office

This is obviously not for everyone, but it works for them, and that is what is important.

The opposite side of the office is floor covered with a tatami mat and a traditional table.

Toyota Museum

I mentioned the Toyota Museum a couple of days ago. If you plan on visiting, plan on about 4 hours. We did not have enough time on the planned itinerary. I have been there before and still would have liked to spend another hour on the site. Good museums are like that.

Japan

The last time I was in Japan (except for stopovers at Narita) was 2000 on a similar seminar. That time we had two weeks in-country, and more time to get out and about. Still, eight years is more than enough time to get a sense of where a country is going. The mid- and late- teens of 2000 are well into the workforce now. While it is still clearly Japan, I also got a sense that things have continued to loosen up a bit, for better or worse. There are also more people on the streets with a few extra pounds than before.

Posted on

Assessing Results vs. Reflection

As we near the end of 2007, most of our respective organizations are looking at what we are going to do in 2008.

Part of that is usually to take a look at this year and look at where we are right now. There are a couple of ways to go about this, and I want to contrast them. This is based only on my own personal experience and, of course, your mileage will vary.

All too often I think this process consists of reviewing results vs. goals. The emphasis is almost solely on targets and actuals. The target was hit or not hit. Top leaders are not interested in “excuses.” I have seen particularly destructive forms of this that included going so far as to re-define success to match what had been achieved. The baseline was re-set at the beginning of the next year, and everything in the past forgotten. Managers took full credit for cost reductions which were “achieved,” not through their own actions, but due to fluctuations in commodity prices of raw materials. Likewise, managers were assigned blame for not hitting targets for the same reason if those prices went up.

There was no review of progress of activities which were predicted to achieve specific results, nor was there a prediction that specific activities would lead to specific results. Instead there was a general high-level target, then a list of actions. Since none of those actions was tied to a verifiable outcome or target, there was no way to know what worked and what didn’t.

Even worse, it really didn’t matter. As long as the targets were achieved, that was what counted. There were great negotiations about exactly how targets would be measured (this company measures everything, and measures nothing). Then, for example, if inventory reductions were to be achieved over the year the actions taken were: (1) Shut down production processes to starve the system. (2) Pull 1Q orders in to 4Q to book the sales. Ships were loaded and sent early because the inventory cleared from the books – even though this was intra-company shipment. They had a LIFO system, so the deeper they could reach into inventory for sales the higher profit they could make since the older the inventory the “lower the cost” associated with it.

All of these games were driven by a “hit the targets and don’t ask about how” mentality. By the way, when 1Q results rolled around things were dismal because they had pulled orders forward PLUS starved the system by shutting down production in 4Q.

This management system is designed intended to deliver results to Wall Street, though it really doesn’t Such is the corrosive nature of trying to manage to “shareholder value” using traditional cost accounting methods. Yes, shareholder value is important, but you can’t manage to it and expect to get the kinds of results that customer and processed focused companies do.

Reflection

Reflection is a learning process. It is designed to incorporate what was learned into shifts in approach for the future. Without it, learning is, at best, an individual action. At worst, the learning is how to survive in the system, not how to do better.

The three key questions are:

  1. What did we intend or plan to accomplish?
  2. What was actually accomplished?
  3. Why the difference?

At a deeper level:

  • Did you accomplished the actions you intended to accomplish? If so, how did that go? What obstacles did you have to overcome? If not, what got in your way that you could not clear?
  • Did each of those actions deliver the expected or planned result? Are you sure? It is just as important to understand why you succeeded as it is to understand why you failed. The commodity price example above is an example of the opposite. They succeeded, but didn’t acknowledge that it wasn’t through anything they did or didn’t do. If an action did not deliver the anticipated result, why not? What did you learn?

Planned? Actual? Please explain.

This is nothing more than the application of PDCA and the Scientific Method. Your plan for the year consisted of a designed experiment. “If we do these things, we expect this results.” Then do that thing, and check that you actually did it. Compare your actual result with the expected result. Explain any difference. Learn.