Tag: People Development

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A “Problems First” Culture

I will be the first to tell you that this is probably repetition of a fairly narrow theme you have seen here before. But I think of different ways to frame it, or get different thoughts, so I share them.

“Problems first” is one of the mantras used by Phil Jenkinson, the CEO character in The Lean Manager by Michael and Freddy Ballé. Now that I have had a few weeks to let it sink in and synthesize with my mental models, I am seeing a concept that is so fundamental I would think it would be hammered into students in every management and leadership course taught in the world.

Of course, though, it isn’t.

Instead it seems alien in most company cultures.

Yet without a “problems first” culture, the leaders really have no idea – none at all – what they should be focusing their attention on. How could they? They don’t know what their people are struggling with until it is too late. By that point, a small unresolved problem has grown to the point where it cannot possibly be ignored, and now it must be dealt with. Task teams are formed, initiatives are launched. Action item lists are made and presented every week, and after enormous expense and effort, the illusion of control is returned. And so many companies are run just like this.

I am pretty sure that anyone reading this knows exactly what this feels like. Let me call it a “hidden problems” culture for now. Maybe I will think of a better term later.

Enough about what it isn’t.

Ironically, a lot of companies in the pursuit of “being lean” actually go blindly through the motions of “problems first,” but so in a way that raises questions about their understanding of this concept.

Let’s look at a simple action item review at a staff meeting.

Typically it looks like this:

For each action, the responsible person reports on the status, whether or not it is “on time” (usually against an arbitrarily assigned due date), and any “problems.” The manager asks if any help is needed, and perhaps assigns more actions to someone else to assist.

One common management tool for these things is a “Stoplight Chart” where actions are assigned color codes of Green, Yellow, or Red, usually depending on progress against the deadline (how late they are).

Red items get the most attention in the meeting (as they should, more about that in a minute), but that attention is usually in the framework of review and reporting.

At the end of the meeting, the senior leader has a good feel for what is happening (or what is not happening).

Contrast this with a world-class automobile assembly line.

Just like the actions items, every task has a deadline. Only in this case, the timing is much tighter – measured in seconds, not days. The assembler knows that if he gets more than 3-4 seconds behind, for any reason at all, he cannot possibly catch up and complete the work cycle on time. He is going to be late.

He pulls the andon cord, to let the team leader know there is a problem.

Key Point: This is not a report of a problem. This is transfer of the problem. The assembler is responsible for carrying out the work as it is designed. If he can’t, for any reason, then exceptions are transferred to the team leader.

The team leader can deviate from the standard work sequence to complete the job, but not the timing. If he cannot clear the problem by the end of the takt cycle, that section of the line will stop, and the andon will go red.

This is not a report of a problem, this is transfer of the problem. The team leader is responsible for assuring the work can be completed within the takt time. If he can’t, for any reason, then exceptions are transferred to the supervisor.

The supervisor is now responsible for clearing the problem and getting things moving again. If he can’t, then within a few minutes, another section of the line will be stopped and the responsibility for clearing the problem transfers to the next level in the chain.

And so it continues.

Of course this increasing level of responsibility does not mean that the others walk away. They are clearly working very hard to get the problem cleared. But each level of escalation brings more resources to bear on the issue.

Note that I haven’t talked about root cause and problem solving yet. Although the escalation procedures are designed to help gain better understanding of the underlying cause, the first priority is to get the problem cleared so that production can resume without compromising safety or quality in any way.

There may be a temporary countermeasure put into place to do this – some short term action that, while it might introduce some extra resources into the process, allows safe, quality production to proceed long enough to get to the underlying cause. One test of understanding that cause can be to remove this temporary crutch and see what happens.

OK, back to the staff meeting.

What is different about that?

The main thing is that typically the problems are being reported, but not escalated. The responsible person may have to come with an action plan to clear the issue, but it is still Management by PowerPoint, and the senior leader’s role is approval vs. involvement. If the senior leader does become involved, it is often driven by a perception that the responsible person is incapable rather than a process of professional development.

What would this look like if it were managed exactly the same way as the assembly line?

What if that monthly review were treated the same as the fixed stop position?

A couple of ideas come to mind.

“Green” means “on track, as originally scheduled.”

“Yellow” means “behind, but we have a plan to get back to green.”

“Red” means behind, and we don’t know how we are going to recover.”

How would those meanings change the tenor of these meetings?

“Problems first” is more than just a discussion about problems. It is a culture that is focused on finding them, clearing them, and solving them, and doing so with the same priority that comes with production.

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Are You Ready for the Upturn?

Many pundits out there think the economy has hit bottom. If the last couple of cycles are any indication, when things start picking up again, it is going to happen fast. As people scramble to retain or gain market share they are going to want more and want it now.

And, if the last couple of times are any indication, many businesses are going to be caught totally flat footed and struggling to increase their output. I would also imagine that the “never again” vows that they made as things were going down will, once again, go out the window.

So, short of building up a lot of inventory and/or investing in excess capacity, what can you do to be more prepared?

Continue to work toward the ideal of one-piece-flow.

This does a few things for you. If you do it right, you will progressively collapse the throughput time of your process. This will make you more responsive to changes and make you less vulnerable to forecast errors.

More importantly, though, is the understanding you gain as you do this work. You want to know the cycle time constraint of each and every process in the value chain. With that information, you can predict what will constrain you from reaching any given level of production, and start to work on those constraints. That does not mean you increase production, nor does it mean that you add capital equipment. It means you know exactly what you are capable of doing, and exactly what you must do to get to the next level. In other words, you have a plan that you can put into motion at any time.

Work to standardize and stabilize your processes.

This effort helps make your work more ready for people. Many operations today are running well below their capacity, and they have lost their performance edge. Problems are going unnoticed and unaddressed because they aren’t really affecting production right now. That will change, and change fast, in a ramp-up situation.

Worse, unstable and poorly understood processes translate to long, error-prone learning cycles for new people, or current people in doing different work.

Re-energize your daily kaizen and problem solving and start seeking out the things that are disrupting the work. That investment will not only develop your ability to respond quickly and robustly to growth, it will develop people’s skills as well.

Develop your people and organization.

This will help your people become more ready for the work.

Things may be slow today, but do you know who you would put into your next leadership positions as they open up? Have you developed those potential leaders? Have you thought through how you will organize and support the work as business expands?

The more preparation you can make now, the easier it will be when you get into a fast-moving dynamic growth period. You will already have a baseline plan, so you will only need to assess the situation, modify as appropriate, and carry it out. The more of this planning you can do now, the more thinking you will be able to put into execution.

Even people who are already in leadership positions can probably use skills development. There are a few easy things you can do that will pay great dividends in a fast-flux environment.

Look into the TWI programs. These address crucial skills that line leaders need to succeed. Ideally, people would demonstrate those skills before being put into leadership positions.

The side benefit is that these programs give people skills they can use today to make the workplace safer, more consistent, and more stable. In a growth situation, Job Instruction gives you a standard method to bring new people on board, or to flex people quickly into different work and get them up to speed.

Free up as much capacity as possible.

The bottom line results of kaizen are seen primarily in the form of additional capacity – you are able to produce more with the same resources. You might not need that additional capacity right now, but if you are living within your means today, you can put that additional capacity in your hip pocket. Then, the first round of sales growth can be met without any additional resources. The better you are at kaizen, the longer you can hold your resource levels the same while growing output. The only way to get better is to practice, and just like learning to play the piano, this means practice every day.

Understand your supply base.

How well do you know your suppliers? How quickly can they respond if your needs change dramatically? Do you know which supplier controls how quickly you can increase output? Do you know at what point that bottleneck shifts to a different supplier?

The other thing to consider here is the length of that supply chain. If you are bringing in things from overseas, there is one fundamental that many people try to wish away:

No matter how hard you try, you can’t change what is on the boat.

That might seem obvious in saying it, but it is amazing how many times that four or five week transportation time ends up negating any “cost savings” in lower prices.

I am not saying this is good or bad. I am saying to look beyond invoice and transportation prices and understand your enterprise value chain as a dynamic, moving thing with a response time to change. That response time becomes critical when things are changing. Know what that response time is, and manage to it. If you don’t like the answers, you have to alter the system somehow.

Bottom line: The time to get good is now.

When you are scrambling to meet demand, “there won’t be time” for kaizen, and there will be even less time to learn how to do it. The time to get good at it is now. Your alternative is growing your cost structure at least as fast as sales are growing. Experience has shown that your cost structure likely grows faster than sales, and additional earnings come only with non-linear growth – relying on volume to make up for ever thinner margins. That might look OK in the short-term, but it is a strategy of becoming ever less efficient.

The better prepared you are for the upside, the stronger you will be the the inevitable next cycle.

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Problems Hidden In The Open

We were down on the shop floor watching an assembly operation. The takt time was on the order of three hours. The assembler was new to the task, and the team leader periodically came by and asked if he was “doing OK.” The reply was always in the affirmative.

As the takt time wound down to under five minutes to completion, this operation was the only one not reporting “Done.”

The count down hit zero, things went red, the main line stopped, and the line stop time started ticking up.

The team leader, other assemblers, the supervisor began pitching in to assist. Between them, the job was completed in about 10 minutes, and the line restarted.

So, again, my favorite question:

What’s the problem?

Lets try breaking it down to four key questions.

  1. “What should be happening?”
  2. “What is actually happening?”

    3. The above two questions define the gap.

  3. “Why does the gap exist?”
  4. “What are we doing about it?”

These questions simply re-frame PDCA, but without so much abstraction.

So, in this situation:

What should be happening?
Two things come to mind immediately.

  1. The work should be complete on time.
  2. As soon as you know it isn’t going to be complete on time, please tell someone so we can get you help.

For this to work, though, the team member needs a clear and unambiguous way to answer a key question of his own: Am I on track to finish on time? Ideally the answer to this question is a clear “Yes” or a clear “No,” with no ambiguity or judgment involved. (Like any “Check” it should produce a binary result.)

On an automobile line with a takt time on the order of 55 seconds, the assembler can get a good sense of this. If he loses more than three or four seconds, he isn’t going to make it. But “a good sense” isn’t good enough.

Even in this fast-moving situation, you will see visual indicators that help the team member answer this question. Take a look at this photo.

toyota-assy

See the white hash marks along line at the bottom of the picture? Those mark off the moving line work zone into ten increments of about 5 ½ seconds. The assembler knows where he should be as he performs each task. If he is a hash mark behind, he isn’t going to finish on time. Pull the andon. We can safely say that, in this example, we have accomplished (1) and (2) above.

With longer takt times, it is much tougher for a human to have a good sense of how much time will be required to complete the remaining work. That makes it that much more critical that some kind of intermediate milestones are clearly established and linked to time.

What would be a reasonable increment for these checks? –> How far behind are you willing to let your worker get before someone else finds out? I’d say a good starting point is at the point when he can’t recover the time himself, the problem is no longer his. Following the standard work is the responsibility of the team member. Recovering to takt time is the team leader’s domain. At the very least, he is the one who pitches in and helps, or gets someone else to do so. But he can’t do this if he doesn’t know there is a problem.

So – what should be happening?

The team member must have continuous positive confirmation that he is on track to complete the work on time. With the failure of that positive confirmation, he should pull the andon and get assistance.

The team member must call for assistance (“pull the andon”) if his work falls behind the expected progress for any reason whatsoever.

What is actually happening?

In our example, the team member didn’t get help until it was too late. In fact, he verbally assured the team leader he was “OK” on a couple of occasions. The line stop was irrefutable evidence of a problem. That was a good thing. This company has a takt time, and runs to it. Think of what would have happened if they didn’t. It might take hours, or days, before this problem surfaced. (We are nowhere near the root cause yet. The line stop is just evidence of a problem, not the problem itself.)

Why does the gap exist?

It is a hell of a lot harder to answer this question than the other two. In this case, you are going to have to peel back a lot of layers before you get to the actual, systemic, root cause. But in the immediate sense, with a takt time bordering on three hours, there is really no realistic way a worker can judge if he has fallen too far behind to catch up. The fact that, in this case, the assembler was still learning the job, and that just compounds the situation.

From casual observation – when the team leader visited, he asked if things were OK and accepted the reply – I would start to investigate whether the team leader had a good sense himself of where the work should be at his regular check points… if he has regular check points at all.

But all of this is speculation, because after 10 minutes of watching the initial response to the line stop, our little group had moved on. I am mentioning these things as possibilities because you likely have the same issues in your shop. (And if you don’t have a rigorous sense of takt time, it is equally likely you don’t know about those issues even at the level we saw here. At least THIS company can see the evidence of the problem. That is a credit to their visual controls.)

What are we going to do about it?

Obviously there are a couple of immediate things that can be addressed to at least contain the problem. (That is, convert a hard line stop into multiple andon calls so the actual problems are seen earlier.)

I would want to establish a regular routine for the team leader’s checks. His leader standard work. At regular intervals, he should be checking progress of the work. How often? How far behind do you want the assembly to get before you are certain someone finds out about the problem? In this case, even every 20 minutes is less rigorous than the hash marks on the auto assembly line. But it would be a start.

So we have the team leader coming by every 20 minutes.

But he can’t just ask “How is it going?” We clearly saw that didn’t work. It isn’t that the assembler lied to him, it is that the assembler didn’t know because there was no standard.

What work should be complete 20 minutes into the work cycle? At 40 minutes? At 60? What verifiable facts can the team leader check by observation? There are a lot of ways to do this, most of them very simple and non-intrusive. Think it through.

But wait – now the team leader himself has standard work. What cues him to do it? Is he supposed to notice that 20 minutes has elapsed? In this case, the company already has a pretty sophisticated andon and sound system. It would be a pretty simple matter to put in an audible signal that told the team leader to make his checks. But, again, that is just one solution. I can think of a couple of others. Can you?

What is the team leader checking for? This is a critical question.

Think about it.

What was the original answer to “What should be happening?” (which is “the standard”)

We said:

  1. The work should be complete on time.
  2. As soon as you know it isn’t going to be complete on time, please tell someone so we can get you help.

We want the assembler himself to be checking #1.

So why do we have the team leader check?

So he can verify that the assembler is pulling the andon when he should. This is important because it is human nature not to ask for help until it is too late. This isn’t limited to factory floors. How many cardiac patients die because they ignored the warning symptoms for fear that it isn’t serious enough to get help?

It isn’t enough to ask the team member to call for help. You have to expect it, encourage it and require it.

Interestingly enough, as I was writing this post, John Shook posted his story about converting the culture at NUMMI.

A cornerstone of Respect for People is the conviction that all employees have the right to be successful every time they do their job. Part of doing their job is finding problems and making improvements. If we as management want people to be successful, to find problems, and make improvements, we have the obligation to provide the means to do so.

But, some of our GM colleagues questioned the wisdom of trying to install andon at NUMMI. “You intend to give these workers the right to stop the line?” they asked. Toyota’s answer: “No, we intend to give them the obligation to stop whenever they find a problem.” [emphasis added]

What was the problem in our example? We don’t know yet. We certainly can’t start looking for causes.

But the evidence of a problem was that the team member could not complete the work in the time expected. That is, he was not successful doing the job. And the line stopped because the support system failed to pick up the fact that he was falling behind until it was too late to recover.

It really does come down to respect for people.

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leanblog.org: Measuring for Improvement

Mark Grabon’s latest post hits the key difference between metrics that help improvement, vs. management-by-measurement that destroys trust and possibly drives unethical behavior. He quotes a U.K. hospital administrator as saying:

“We’re trying to shift from collecting data for judgment to data for improvement.”

I agree with Mark’s assessment: “Brilliant.”

Metrics are a “Check” in Plan-Do-Check-Act.

The purpose is not to determine if people are “doing their jobs” but to assess if the plan is working as predicted.

“As predicted” means that not only is there an objective, but there are discrete actions which everyone agrees will cause the objective to be reached.

Note the words “everyone agrees.”

For that to happen, not only are objectives handed down, but the plan to reach them is discussed. The boss is keenly interested in exactly how his people plan to accomplish their objectives, and he has bought in after he is satisfied they have done thorough work. Think about that for a second. The boss now has his own “skin in the game” on not only the objective, but the way to get there.

There isn’t any space, at this point, for judging people based solely on hitting the numbers, because the boss has already agreed that the plan should work. The question now comes down to how well the team did putting together a plan and gaining consensus, and how well they executed. If the numbers aren’t hit, everybody has to reflect on why the plan didn’t work, what they didn’t foresee, and what they need to do better next time.

Management-by-measurement, on the other hand, is an abdication of leadership. It becomes an adversiaral rather than collaborative exercise and becomes a contest of politics and blame-shifting. This is why, I think, Deming finds the merit system and individual performance bonuses so destructive.

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How The Sensei Teaches

In a previous post, I talked about Steven Spear’s observation about how a sensei saw a process and the problems. Jeffery Liker, Mike Hoseus and David Meier have done a good job capturing how a sensei teaches and summed it up in a diagram in the book Toyota Culture. (for those of you following at home, the diagram is figure 18.9 on page 541).

I want to dissect this model a bit and share some of the thoughts I had.

This is the whole diagram:

How a sensei teaches

This diagram strikes me in a couple of ways.

Let’s zoom in to the left hand side.

sensei-do-loop1

I’m calling the part I’ve highlighted in red the “sensei do-it-loop.” That is, the sensei says “Do this,” the students do it, then the sensei says “Now, do this.” Repeat.

While this first loop is the starting point, all too often, it is also the ending point.

And in this loop, process improvement actually happens, everybody applauds at the Friday report-out. The participants may even prepare a summary of key learning points. And perhaps, as follow up, they will apply the same tools in a similar situation. (As much as I hope for this outcome, though, it doesn’t happen as often as I would like.)

A lot of consulting engagements go on this way for many years. Some go decades. I am sure processes improve, and I am equally sure it is very lucrative for those consultants. But even if they are extraordinarily skilled at seeing improvement opportunities and pointing them out, these consultants are not sensei in the meaning of this diagram. That distinction is made clear in the next section.

This is where the learning happens.

Sensei Learning

I have highlighted the learning loop in red.

The sensei is primarily interested in developing people so that they can see the opportunities and improve the processes themselves. He wants to move them along the continuum from “Do” to “Think” so that they understand, not only this process, but learn how to think about processes in general. When the sensei asks the questions, he is forcing people to articulate their understanding to him. He is really saying “teach me.” In this way he pushes people to deepen their own understanding from “think it through” to “understand it well enough to explain to someone else.”

Think about Taiichi Ohno’s famous “chalk circle.” The “DO THIS” was “stand here and watch the process.” He had seen some problem, and wanted the (hapless) manager to learn to see it as well. Ohno didn’t point it out, he just directed their eyes. His “test” was “What do you see?,” essentially repeated until the student “got it.”

The second leap here is from “Think” to “Self Learning.” At this point, people have learned to ask the questions of themselves, and of each other.  So when he asks his questions, the sensei is not merely interested in the answers as a CHECK of learning, he is also teaching people the questions.

These questions are also a form of “reflection.” They are a CHECK of what was planned vs. what was done; and what was intended vs. what was accomplished. The ACT in this case is to think through the process of improvement itself, not simply what was improved.

Until people learn to do this, “Self Learning” does not occur, and the team is forever dependent on external resources (the sensei, consultants) to push themselves.

But the sensei is not through. Once people have a sense of self-learning, the next level is capability to teach others. “All leaders as teachers.”

Learning to Teaching

Someone, I don’t know who, once said that teaching is the best learning. I can certainly say that my own experiences back this up. My greatest ah-ha moments have come when I was trying to explain a concept, not when it was being explained to me.

I would contend, therefore, that a true sensei is not so much one who has mastered the subject, but rather one who has mastered the role of the eternal student. It is mastery in learning that sets apart the very best in a field.

Thus the sensei‘s work is not done until he has imparted this skill to the organization.

As the leaders challenge their people to thoroughly understand the process, the problems, to explore the solutions, so do the leaders challenge themselves to understand as well.

They test their people’s knowledge by asking questions. They test the process knowledge of their people by expecting their people to teach them, the leaders, about the process. Thus, by making people teach, they drive their people to learn in ways they never would have otherwise. The leader teaches by being the student. The student learns by teaching. And the depth of skill and knowledge in the entire organization grows quickly, and without bound.

So Here Is Your Question:

If your organization is typical of most who are treating “lean” as something to “implement” you have the following:

You have a cadre of technical specialists. Their job, primarily, is to seek out opportunities for kaizen, assemble the team of people, teach them the mechanics, then guide them through making process improvements that hit the targets. This is often done over the course of 5 days, but there are variations on this. The key point is that the staff specialists are delegated the job of evangalizing “lean” and teaching it to the people on the shop floor.

Again, if it is typical, there is some kind of reporting structure up to management. How many kaizens have you run? What results have you delivered? How many people have been trained? Managers show their commitment and support by participating in these events periodically, by attending the report-outs, and by paying attention to these reports and follow-up of action items.

Now take what you have just read, and ask yourselves – “Are we getting beyond the first loop, or are we forever just implementing what is in the books?”

How are you reinforcing the learning?

Who is responsible to learn by teaching?

I’ll share a secret with you about a recent post. When Paul and I took Earl through his own warehouse that Friday night, neither of us had been in there before. While I can’t speak for Paul, everything I knew about warehouse operations and crossdocks, I learned from Earl. I didn’t teach him anything that night. Paul and I did, however, push him to teach us, and in doing so, he learned a great deal.

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Genchi Genbutsu in a Warehouse

Now and then something comes across that makes it all worth it. And nothing is more “worth it” to me than to know something I said or did contributed to someone’s insight or impetus to do something spectacular.

Yesterday Earl sent me an email that is one of those times. I was going to edit it from an email to me into a story about Earl’s experience. But instead, I decided to just publish it (with his permission) pretty much as I got it. But to be clear, this is about Earl, and his learning, not about me or my teaching.

Mark,

I received this email [see below] the other day from John.

John was one of the lean leaders working for me in Rochester when I was the Lean Director for Kodak’s Global Logistics team and you were the Lean Director for Equipment Mfg. He is now a professor at RIT teaching lean.

One of the things he does with every class is bring them through his old operation in Kodak. The operation is an outbound crossdock for all of Kodak Park where, through applying our lean principles, primarily “flowing at takt”, we have taken a 2,000,000 square foot (186,000 m2) warehouse and replaced it with an 85,000 square foot (<8000 m2) crossdock.

Along the way we reduced the costs by 70%, improved the reliability to +/- a few hours, and amassed an enviable safety record….and as you can see in his note, we’re making it better every day.

When I think back to how we got here, I have to go back to what started as an innocent Friday night, when you, Paul Cary, and I were sitting around his office and you and Paul were pushing on me that we weren’t really thinking about lean in the right way in Logistics, and I was pushing back that “you didn’t understand”….that we just move pallets around the warehouse.

I can remember like it happened yesterday, but it was actually a few years ago, you and Paul looked at each other, looked at me, jumped up and said “Let’s go see”, so we did.

Several hours later, we emerged from the warehouse, not tired and worn out, but energized and excited. You had helped me to see what was invisible to me (and everyone else around)….even though I was the local “lean expert”.

The approach was classic “Mark”, and I have to admit I’ve stolen it and used it as my own many times, although not nearly as effortlessly. At your insistence, we entered through the outbound dock door, as you pointed out, “closest to the customer”. As I started to walk through and into the warehouse proper, you stopped at the door, and made me stop and describe what I was seeing.

The “Five Why’s” were relentless, and I think it was something like 30-40 minutes before we even moved off that spot, but the seeds were planted right then and there. I had now started to see the whole warehouse as “waste” and totally unnecessary if we could only get product flowing at takt. I can’t tell you how many times I’ve relied on the lessons learned that night to guide me when I get in the middle of something unfamiliar to me.

Well, it took us a couple of years, but your invaluable and patient counsel over the next few years shaped a whole organization’s culture. I know better (now) than to suggest “we’ve arrived”, but the principle of using “flow at takt” and making waste visible to drive continuous improvement is firmly rooted in our DNA now.

Aside from the impressive performance statistics of the operation I know you’ll appreciate more that the things you taught me have been dutifully passed along from me to the manager of the area, and through him, to his successor, and now through the college to many more. All we have to do now is close the loop and get you to hire one of the RIT students somewhere!

I’ll not pretend that a couple of hours on a Friday night several years ago was all it took, and I’m forever indebted to the many hours you spent with me afterwards helping me to grow, but it was truly a life changing event, and I thought you’d appreciate seeing a snippet of what it’s led to. Thanks again for all your insight and support in our, and my, journey.

If you ever find your way back East, you have to stop in to see it, drinks are on me. It is pretty wild, but if you do, I might tiptoe carefully around the idea that you’re the guy that taught me to “physically constrain the process to force it to flow at takt”. It was an essential part of our journey, but obviously anyone that would suggest we can change a 2,000,000 square foot warehouse into an 85,000 square foot crossdock can’t be seeing the world the right way! (Of course I have to follow that up with one of my favorite quotes one of the VP’s here used….”If it wasn’t for the fact we already did it, we would have said it’s impossible”. Thanks again.
This is the email he is talking about:

Dave and Tony, thanks again for giving the walk through to my 25 advanced lean class students yesterday. Some observations:

I think the floor was about the cleanest I have ever seen it. It is always clean, but yesterday seemed even more so.

The evidence of continuous improvement is amazing. Yesterday I saw a number of things that I did not see in my last visit Feb 10 – new lane structures, hybrid cards, changes in box 2, clearer e-box sheets, new standard work sheets and visuals, etc.

I really appreciate you taking to heart the input I gave you based on the feedback from my last class on the tour structure/agenda itself. The last tour was very good, this one was awesome. The standard work sheet Dave showed me for the tour was great standard work – content, sequence, timing and outcomes were all vividly clear. I asked for more of a focus on the production control system and you delivered on that request. Dave, in your intro, you sounded like me teaching my class (maybe not a good thing?!?).

[…]I was pleased the students had more time to ask more questions. I keep preaching continuous improvement in class and you guys model it which helps give the message credibility in the minds of the students.

The other thing that struck me, which is not new but seemed different for some reason I can’t explain….. You are moving large volumes of freight, […] and the floor is just so calm. There is no panic, no arguing, no anxiety, just people following the processes, getting product from point A to point B, in a quiet, controlled, efficient way. I still remember when I brought the facilities class over last spring, and especially 2 of the folks with lots of work experience said “I never imagined that a warehouse type of environment could actually look like this.”

Your safety performance is stunning. I know the record when I was there was 534 days. Then we had 2 “old-age” repetitive motion injuries in 2 weeks, then you went 600 + days. Now you are at 200+ days. Absolutely remarkable in a tight space with fork lift trucks moving around. 3 OSHA reportables in 4 years, wow.

I clearly remember “that Friday night.” I think we were in there until 10:00 or later. Paul and I had a really good synergistic style, we reinforced each other, and it was an intense experience for whoever was on the receiving end. This was not the last time we took someone through this exercise.

To be sure, it was Earl and his team that did all of the heavy lifting. All Paul and I did was give him a sense of an ideal flow, and challenged them to discover, and overcome, the obstacles between the current state and that vision – one problem at a time, a couple every day.

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Back to Basics

The Lean Enterprise Institute is taking up a “Back to Basics” theme.

But what, exactly, are “the basics” of the Toyota Production System?

This is critically important. Permit me to cite an analogy.

Look at a house. What do you see? What would you say are “the basics?”

At first glance, all houses have walls, a roof. They have a door. They are divided into rooms for various activities and purposes. A “basic house” is going to have an entry, a living room, a kitchen, a couple of bedrooms, a bathroom. More complex houses will have more rooms, fancier architecture, higher grades of materials, be bigger, but the basics are all there.

OK, that is a basic house.

I make this point because when people talk about the basics of “lean manufacturing” they talk about the things you can see. If I open up Learning to See, and turn to the “Green Tab” the chapter’s title is “What Makes A Value Stream Lean.” That chapter is primarily (right after the talk about waste and overproduction) a list and description of “Characteristics of a Lean Value Stream.”

  1. Produce to your takt time.
  2. Develop continuous flow wherever possible.
  3. Use supermarkets to control production where continuous flow does not extend upstream.
  4. Try to send the customer schedule to only one production process.
  5. Distribute the production of different products over time at the pacemaker process (level the production mix).
  6. Create an “initial pull” by releasing and withdrawing small, consistent increments of work at the pacemaker process. (Level the production volume).
  7. Develop the ability to make “every part every day” (then every shirt, then every hour or pallet or pitch) in fabrication processes upstream of the pacemaker process.

Now I have to say right now that I have always loved this chapter. I cannot count the number of people I have referred to “The Green Tab” as a fundamental primer. It includes all of the basics, just like our house.

In their latest book, Kaizen Express, the LEI has brought out some more detail on these same points, and added a few “rooms” to the house. One critical aspect they add is various topics that add up to quality. (It’s kind of like leaving out the kitchen or the bathroom if you don’t mention that.) They talk about zone control, line stop, and countermeasures to quality problems. (I will do a full review on this book soon.)

Then on page 99 starts four pages on Employee Involvement where they talk about practical kaizen training (PKT), and suggestion programs.

Let’s go back to our house. The things we said were “the basics” were the things you see when you look at it from the street, and go inside and walk around in it. But in an industrialized country, the modern single family residence is a miracle of accumulated knowledge and technology. The basics are the things that keep it from sinking into the ground, from catching on fire, from leaking and rotting. They are the things you can’t see, but unless you understand them, your house may look like the one next door, but it won’t perform like the one next door.

I have been in dozens of factories that had takt time, some semblance of continuous flow, pull systems, supermarkets, all of that stuff. They had run hundreds, maybe thousands, of kaizen events, and had suggestion programs. All of these things were visible just by walking around.

Yet most of them were stuck. They had reached a point when all of their energy was being expended to re-implement the things that had slid back. Three steps forward, three steps back.

They had read Ohno’s book, they knew the history of the Toyota Production System. They understood all of the engineering aspects of the system, and could install very good working examples of all of it.

But something wasn’t there, and that something is the foundation that keeps the house from sinking into the ground. It is the real basics.

Kaizen Express hints at it on pages 99 – 102, it is true employee involvement. And here is a real basic: Employee involvement is created by leader involvement. Not just top leaders, all leaders, at all levels.

To be honest, a lot of technical specialists don’t like that very much for a couple of reasons. First, engaging the leaders, at all levels, is really hard. It is a lot easier to get things done by going straight to the gemba and doing it ourselves – we show people how to do it, we “engage” them in the initial implementation, and everything is wonderful for the Friday report-out.

But I contend that the foundation of the Toyota Production System is the leadership system. It is the system of leadership that holds up all of the walls that we call takt, flow and pull. Those things, in turn, enable the leadership system to function better. The “characteristics of a lean value stream” evolved in response to the leadership system, in order to strengthen it. It is a symbiosis, an ecosystem.

“But it didn’t start out as a leadership system.” No, it did not. The history of how the Toyota Production System evolved is well documented, and the leadership system was less designed than it evolved. But let’s go back to our house analogy.

Primitive houses only have the “basics” I described above. They don’t have sophisticated foundations, some are just built on skids (if that). But because they lack the basics, most of those primitive houses don’t last.

And there is the paradox. When we say “back to the basics” we cannot only refer to the chronological history of how the system developed. We have to take the most successful, most robust example in front of us today, and we have to look at what fundamental thing holds this thing up and lets it grow more robust every day.

So let’s take a look at what Toyota teaches when they teach someone the basics.

The article Learning to Lead at Toyota was written back in 2004, but I still feels it offers a lot of un-captured insight into the contrast between what Toyota thinks are “the basics” and what most others do. I want to encourage everyone to get a copy, and not just read it, but to parse it, study it, and use it as an “ideal condition” or a benchmark. Compare your “lean manufacturing” and your leadership systems to what is described in here. Ask yourself the question:

Do we really understand the basics?

Note: There are now links to my study guides for Learning to Lead at Toyota on the Resources page.

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Grassroots Innovation: Business is Like Swimming, Not Running

Grassroots Innovation: Business is Like Swimming, Not Running

Let’s take Greg Eisenbach’s totally on-target analogy and expand just a bit. Greg points out:

…a world class swimmer is only 9 percent mechanically efficient. This means 91 calories out of 100 in swimming are lost due to friction.

For the non-world class swimmer the best way to increase your speed is not to spend more calories, but figure out how to become more efficient. A gain from 3% efficiency to 4% efficiency would represent a 33% increase.

Business is the same way.

This probably explains why a little thing like the new technology in competitive swimming suits had such a huge (and controversial) impact in the 2008 competitive season. In competitive swimming, small advantages are huge advantages.

One of the big differences, though, between swimming and business is that a competitive swimmer knows, in real time, that he is winning or losing. Triathlons aside, a typical swim race is under a minute, a long one might be a couple. In this competitive environment, it is impossible to be complacent and believe you are in the race when, in fact, you are not.

On the other hand, I have worked with a number of businesses (or operations within larger businesses) that have had a truly amazing capacity for denial. What else can explain a headline in a company’s internal newspaper that exclaimed the “big order” when, in fact, the customer had placed a mixed order, giving 80% of it to the competitor… but no mention of that inconvenient truth. So when this company also wonders why people feel “no sense of urgency” you have to wonder. Of course the real story was all over the local news, about how the competitor had gotten the bulk of the order, and how the local company had “lost” it, only getting 20%. What does that do for the corporate credibility? Not much.

World class swimmers are 9% efficient. World class manufacturing value streams are about 40% value-add. (By % value-add I mean the time the product is actually in the value stream vs. the time something that matters is actually being done to it.)

Contrast this with a typical manufacturing flow where the value-add can easily drop into single digits.

This is basic stuff, but sometimes we forget what this lean stuff is about.

Consider a 10% value-add flow. Out of 100 minutes in the plant, 10 minutes are spent actually processing. The other 90 minutes are just sitting, moving, counting, stacking, etc.

Let’s say I spend my time and energy to speed up the value-adding process (like make the chips fly faster, speed up the processing time, find some high-tech fast curing compound). Let’s say I am really successful and cut that value-adding time in half. Whoo-hoo.

Now out of 95 minutes in the plant, 5 minutes are spent actually doing something.

Not exactly a stellar improvement, no real impact on lead time, no reduction in inventory, no reduction in waste. All of the original costs are still there, and I have probably just added more.

On the other hand, if I were to focus my time and energy on reducing that 90 minutes of “other stuff” I run into a couple of realities.

First, all of that “other stuff” costs time, money, space and accumulates inventory. It adds to lead time. Cutting it in half cuts the lead-time from 100 to 55.

And critically important – these changes are typically pretty easy to make. They don’t require engineering or computer science degrees, they just require watching the work and asking “Why is this stopping, why can’t it just go to the next operation right away?”

Greg is dead-on with his analogy. The difference, though, is that there is much higher potential for businesses to improve than there is for swimmers.

But like swimming, small advantages are huge advantages. It isn’t the companies that make the “blitz” type of changes that are sustaining world-class players. It is the companies that, every day, scratch out another little improvement.

It is those “a little every day” companies that, over time, build an insurmountable lead. They engage more of their people, and they learn as an organization what continuous improvement is all about. The “blitz” approach retains the knowledge in the few experts who are responsible for all of the kaizen activity. As good as they may be, they can’t be everywhere.

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The TPS In Four Words

ptolematic_universeIn the world of science, great discoveries simplify our understanding. When Copernicus hypothesized that everything in the universe does not revolve around the Earth, explaining the motions of things in the sky got a lot easier.

In general, I have found that if something requires a great deal of detail to explain the fundamentals, there is probably another layer of simplification possible.

Even today, a lot of authors explain “lean manufacturing” with terms like “a set of tools to reduce waste.” Then they set out trying to describe all of these tools and how they are used. This invariably results in a subset of what the Toyota Production System is all about.

Sometimes this serves authors or consultants who are trying to show how their process “fills in the gaps” – how their product or service covers something that Toyota has left out. If you think about that for a millisecond, it is ridiculous. Toyota is a huge, successful global company. They don’t “leave anything out.” They do everything necessary to run their business. Toyota’s management system, by default, includes everything they do. If we perceive there are “gaps” that must be filled, those gaps are in our understanding, not in the system.

So let me throw this out there for thought. The core of what makes Toyota successful can be expressed in four words:

Management By Hypothesis Testing

I am going to leave rigorous proof to the professional academics, and offer up anecdotal evidence to support my claim.

First, there is nothing new here. Let’s start with W. Edwards Deming.

Management is prediction.

What does Deming mean by that?

I think he means that the process of management is to say “If we do these things, in this way, we expect this result.” What follows is the understanding “If we get a result we didn’t expect, we need to dig in and understand what is happening.”

Control ChartAt its most basic level, the process of statistical process control does exactly that. The chart continuously asks and answers the question “Is this sample what we would expect from this process?” If the answer to that question is “No” then the “special cause” must be investigated and understood.

If the process itself is not “in control” then more must be learned about the process so that it can be made predictable. If there is no attempt to predict the outcome, most of the opportunity to manage and to learn is lost. The organization is just blindly reacting to events.

Here is another quote, attributed to Taiichi Ohno:

Without standards, there can be no kaizen.

Is he saying the same thing as Deming? I think so. To paraphrase, “Until you have established what you expect to do and what you expect to happen when you do it, you cannot improve.” The quote is usually brought up in the context of standard work, but that is a small piece of the concept.

So far all of these things relate to the shop floor, the details. What about the larger concepts?

What is a good business strategy? Is it not a defined method to achieve a desired result? “If we do these things, in this way, at these times, we should see this change in our business results.” The deployment of policy (hoshin planning) is, in turn, multiple layers of similar statements. And each of the hoshins, and the activities associated with them, are hypothesized to sum up to the whole.

The process of reflection (which most companies skip over) compares what was planned with what was actually done and achieved. It is intended to produce a deeper level of learning and understanding. In other words, reflection is the process of examining the experimental results and incorporating what was learned into the working theory of operation, which is then carried forward.

Sales and Operations Planning, when done well, carries the same structure. Given a sales and marketing strategy, given execution of that strategy, given the predicted market conditions, given our counters to competitor’s, we should sell these things at this time. This process carries the unfortunate term “forecasting” as though we are looking at the weather rather than influencing it, but when done well, it is proactive, and there is a deliberate and methodical effort to understand each departure from the original plan and assumptions.

Over Deming’s objections, “performance management” and reviews are a fact of life in today’s corporate environment. If done well, then this activity is not focused on “goals and objectives” but rather plans and outcomes, execution and adjustment. In other words, leadership by PDCA. By contrast, a poor “performance management system” is used to set (and sometimes even “cascade”) goals, but either blurs the distinction between “plans” (which are activities / time) and “goals” which are the intended results… or worse, doesn’t address plans at all. It gets even worse when there are substantial sums of money tied to “hitting the goals” as the organization slips into “management by measurement.” For some reason, when the goals are then achieved by methods which later turn out to be unacceptable, there is a big push on “ethics” but no one ever asks for the plan on “How do you plan to do that?” in advance. In short, when done well, the organization manages its plans and objectives using hypothesis testing. But most, sadly, do not.

Let’s look at another process in “people management” – finding and acquiring skills and talent, in other words, hiring.

In average companies, someone needing to hire someone puts in a “requisition” to Human Resources. HR, in turn, puts that req out into the market by various means. They get back applicants, screen them, and turn a few of them over to the hiring manager to assess. One of them gets hired.

What happens next?

The new guy is often dropped into the job, perhaps with minimal orientation on the administrative policies, etc. of the company, and there is a general expectation that this person is actually not capable of doing the work until some unspecified time has elapsed. Maybe there is a “probation period” but even that, while it may be well defined in terms of time, is rarely defined in terms of criteria beyond “Don’t screw anything up too badly.”

Contrast this with a world-class operation.

The desired outcome is a Team Member who is fully qualified to learn the detailed aspects of the specific job. He has the skills to build upon and need only learn the sequence of application. He has the requisite mental and physical condition to succeed in the work environment and the culture. In any company, any hiring manager would tell you, for sure, this is what they want. So why doesn’t HR deliver it? Because there is no hypothesis testing applied to the hiring process. Thus, the process can never learn except in the case of egregious error.

If we can agree that the above criteria define the “defect free outcome” of hiring, then the hiring process is not complete until this person is delivered to the hiring manager.

Think about the implications of this. It means that HR owns the process of development for the skills, and the mental and physical conditioning required of a successful Team Member. It means that when the Team Member reports to work in Operations, there is an evaluation, not of the person, but of the process of finding, hiring, and training the right person with the right skills and conditioning.

HR’s responsibility is to deliver a fully qualified candidate, not “do the best they can.” And if they can’t hire this person right off the street, then they must have a process to turn the “raw material” into fully qualified candidates. There is no blame, but there are no excuses.

Way back in 1944, the TWI programs applied this same thinking. The last question asked on the Job Relations Card is “Did you accomplish your objective?” The Job Instruction card ends with the famous statement “If the worker hasn’t learned, the teacher hasn’t taught.” In other words, the job breakdown, key points and instruction are a hypothesis: If we break down the job and emphasize these things in this way, the worker will learn it over the application of this method. If it didn’t work, take a look at your teaching process. What didn’t you understand about the work that was required for success?

I could go on, but I have yet to find any process found in any business that could not benefit from this basic premise. Where we fail is where we have:

  • Failed to be explicit about what we were trying to accomplish.
  • Failed to check if we actually accomplished it.
  • Failed to be explicit about what must be done to get there.
  • Did something, but are not sure if it is what we planned.
  • Accepted “problems” and deviation as “normal” rather than an inconsistency with our original thinking (often because there was no original thinking… no attempt to predict).

As countermeasures, when you look at any action or activity, contentiously ask a few questions.

  • What are we trying to get done?
  • How will we know we have done it?
  • What actions will lead to that result?
  • How will we know we have done them as we planned?

And

  • What did we actually do?
  • Why is there a difference between what we planned and what we did?
  • What did we actually accomplish?
  • Why is there a difference between what we expected and what we got?

The short version:

  • What did we expect to do and accomplish?
  • What did we do and get?
  • Why is there a difference?
  • What are we doing about it?
  • What have we learned?
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Learning To Sensei: LEAN.org

John Shook’s latest column on LEI’s site is about coaching and whether it is better to give them the answers or just ask questions.

Asking questions in a way that actually teaches is a skill that we, as a “lean” community do not foster very well. Certainly in U.S. corporate culture, we are expected to be the experts, and to have the answers. John’s post is summed up well by his last paragraph:

Learning to Sensei: A prerequisite for the apprentice sensei who is learning to not give solutions is to grasp for himself the fact that he doesn’t actually know the solution. Once you grasped that, then it’s very easy to not give “the answer” you simply don’t really have an answer to give. But, while it is not necessary for you to give or even possess “the solution”, you do have an important obligation, which is to give the question or learning assignment in a way that will lead to the learning, with learning as the goal. Once that is accomplished, all sorts of “solutions” will fall out. Then you can experience the joy, liberation, and humility that come with admitting you don’t know.

You can read the whole thing here:

LEAN.org – Lean Enterprise Institute: Coaching and Questions; Questions and Coaching

Now, as an additional value-add…

This really falls under the general notion of “Socratic teaching.” One of the best overviews of what this is really about is Rick Garlikov’s classic piece where he recounts his experiment with teaching through questions. If you don’t think this can work for difficult topics, then I suggest you read his account of using only questions to teach binary arithmetic to a typical class of third graders. If he can teach 8 year olds to understand that 0110 + 0011 = 1001, then surely we can get adults through understanding why takt time is important for management.

“What are you trying to do?”

“How will you know you have done it?”