The “Real” 3 + 2 Rules of Successful

Project Management
January 10, 2018/in Grab Bag, Tools and Methods /by Sean Wright

I’ve got your “REAL” 3+2 rules right here.

In my earlier career before I became a Lean-head, I held progressively responsible

engineering and management roles within the technology sector. Those were the
days. Silicon Valley was positively sizzling — the engineer’s revenge. If you didn’t
take at least three after-work meetings each week with your personal headhunter
(aka, the Long Island Ice Tea enabler), you were branded a “going nowhere slacker”.

New breakthroughs were scheduled daily by suit-wearing big bosses far above my
salary grade who vaguely recalled from college that Ohm’s Law was some advanced
form of guided meditation. These were the same guys who had long since forgotten
the importance of performing a credible tolerance stack-up… you know, one good
enough that you’d trust the safety of your family with the product. Anyway, since no
one told us we couldn’t develop new stuff all the time, and capital was positively e-v-
e-r-y-w-h-e-r-e, we blissfully did make new things every day… uh… that is, blissful
for the most part.
With some early performance wins on my part, and a willingness to accept
accountability for my actions, my career swiftly blossomed into leading the
development cycle for the hardware I used to touch. Like all the other new Project
Managers, I thought my job was more or less to get people organized to meet
contract and technical requirements. At the time, we used a genuine bleeding-edge
breakthrough called the “Integrated Product Development Team” (IPDT). (May say
more about that another time because it’s not what this post is about. For our
purposes here, just imagine what it might be or refer to the link.)
Among the IPDT’s rollcall were many of my former colleagues from the high-tech
trenches. That description of them mainly denotes that we took morning breaks
together and were on the same after work (when not with our headhunters) beach
volleyball squad. Sometimes we even accidentally put on each other’s lab coats —
and then laughed about it. Still a crack-up.

The first time out of the chute with my very own IPDT I detected some interesting
characteristics among my former frontline collaborators; qualities that I had not
previously perceived through my 5% pink-tinted tech-nerd spectacles (caused by
early-onset presbyopia from scanning too much fine print).

First off, some of the team were unaware of the difference between
reality and illusion.
We now know that at the root of this problem was the influence of freshman
philosophy and psychology classes foisted upon these poor souls before their brains
had fully developed.

Others had no concept of time.

That one was harder for me to fathom as I had been acquainted with several of these
folks since our foundations in public school. I was certain that calendar and
timekeeping theory had been covered, even in home room… more than once. And it
wasn’t that long ago. Of course, back then the bell sounded to change classes at the
end of the period, so that helped bridge the gap.

Many of the rest simply couldn’t make decisions – at least not very
quickly.
Okay, I kind of get that one. I mean, things were changing so fast that – if – you
simply waited for the fabled “optimized solution” with “better data”, you could
easily justify taking four weeks to place an order for a simple digital multimeter —
because hey, everyone knows that newer one will be way better.
As I pondered emerging perceptions concerning my mates and considered how to
best manage my troubled sentiments about our workforce in general, I was also
fortunate enough to work for a string of really excellent bosses who, in composite,
laid down an easy to remember set of rules that absolutely addressed all of these
concerns and has served me well. Now, it’s true that there are countless tomes
available on the machinations of best-in-class project management that I might have
referred to instead. On the other hand, these rules are simple enough to remember
and actually use. For each, I’ll inform, then briefly expand upon the real 3 + 2 rules of
successful project management – the only ones that genuinely matter.
Since you’ve been patient and probably only scrolled down two or three times to
look ahead for some concise table that images well on the screen of your Galaxy S8+,
I’ll now share them with you here.

RULE 1: If it exists, show it to me.

 Elegantly simple it its demand, we have an agreement that something which
occupies space and has mass should be here today. Nothing else will do… Really.
 Enlightened manager query: Ryan, could you use some help with keeping your
commitment?
RULE 2: Time stops for no man.
(I mean, person… I mean, associate… I mean… oh, crikey… recurring attack of charm
school political correctness. Thought I was cured. Sorry everyone.)

 We have competitors. I’ve been told that the definition of ‘competitors’ is that
they do everything better and faster and seek to annihilate us… Really.
 Enlightened manager solution: Look everyone! Who could have dropped off
this crate of day-planners?
RULE 3: Make a decision; if it’s wrong, we’ll make another one
tomorrow.
 Chances are darn good that you know the right thing to do. You’ve got a 4.0
Stanford BSEE, right? Wallow in indecision if you must. Or better yet, take a leap
and be handsomely rewarded… Really.
 Corollary to rule 3: I said make a decision, not any decision. If you make a
decision and it doesn’t work out, you’ll still be here tomorrow for the redirect. If
you make any decision as a habit, eh… probably not so much.
 Enlightened manager recognition: Chris, well done, just what we needed. You
da’ bomb!

Later on, inspired by notable IPDT outcomes while observing only the prior three
rules, I was then prepared to absorb the following two concepts that I’ve discovered
apply almost universally… bonus rules I include just for you.

RULE 4: Where there is the shadow of a doubt, there is no doubt.

 If you’re positive that “Casey” is stealing from the company, everyone else
knows too. And if Casey openly admits he / she is stealing, then there’s a good
chance you’re all correct in your assertion. No mob mentality here, just common
sense… Really.
 Enlightened HR Manager’s role: Casey, I need to inform you that we are
separating you from your employment here today. (Can you guess why this act
is enlightened?)
RULE 5: Hope dies last.
 Special corollary of rule 4: Waiting for Casey’s behavior to improve and
return the money he / she embezzled from the company reveals what a truly
great heart you have. But, it won’t happen… Really.
  Enlightened project manager’s take: I could buy some time, heal Casey, and
lose the respect of all my honest project team members who are just trying to get
something done and have some fun with like-minded people – or not.
That’s it dear readers. The real 3 + 2 rules of successful project management. These
should spare you years of tedious discovery and position you for
speedy domination, control, uh… leadership of your market space.

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

See how we helped a West Coast based biotechnology company streamline their
contracting process so that new drugs could be brought to market more quickly and
with higher quality. Read the case study –>

Time is the Common Denominator of all

Wastes
November 4, 2017/in Change Management, Engagement, Tools and Methods /by Jerry Timpson
When it comes to improving operations, how many wastes are
there really?
I recently read an article that asked the question: How many types of waste are
there really? This was in reference to Lean and the original seven wastes in Taiichi
Ohno’s iconic Waste Wheel, shown here.
The comments were interesting. Apparently there are tightly-held beliefs on this
topic. Let’s try not to over complicate something that Ohno intended to be quite
simple, but because waste is the red thread of all Lean, it’s worth consideration.

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

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

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

My take: It doesn’t really matter. Waste can be subdivided many ways. If you think
there are 20 different types of waste and this helps attack any one of them better; go
for it. In the name of continuous improvement we must be willing to add or subtract
in order to improve the system. Right? Yes. Be careful though: More choices seems
somehow less Lean, doesn’t it?
People Energy, Alignment and Engagement
Which brings us back to the concept of the waste of people’s intellect. When it comes
to achieving operational excellence, a tremendous amount of time is lost by failing to
engage people doing their daily work. Non-inclusion results in false starts, half
measures, low sustainment and do-overs. Workshops and Kaizen Events may be
common, but sustainable results are only achieved when people are tangibly
connected to everyday improvement.

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

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

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

**********

Notes:

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

If you want to learn more about Kaufman Global’s approach to engagement and
alignment, check out SLIM-IT, Procedural Adherence and Lean Daily Management
System. For a deep dive into the waste wheel and how it applies to Lean, check out
our White Paper: Implementing Lean Manufacturing.
Lean Manufacturing White Paper: Part 3
of 3
August 11, 2017/in Tools and Methods, Whitepapers /by Kaufman Global
The third and final excerpt in a 3-part series from Kaufman Global’s updated white
paper, Implementing Lean Manufacturing: A Holistic Approach.
In Part 1 and Part 2 we covered the genesis of Lean manufacturing, why “pull” is
such a fundamental concept and how Lean is an integrated system that goes well
beyond technique. Here, in Part 3, we close the series with prescriptive approaches
for attacking each of the 9 forms of waste. In this installment we discuss:
 SLIM-IT ®: A proven structure for successful implementation
 The Lean Daily Management System ® and the 20 Keys ®
 A graphic example of what happens when you move from push to pull
For each of the forms of waste there are certain attack methods. We start with
People Energy Waste because it is the most challenging for most organizations.

Attacking People Energy Wastes

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

Figure 6 – The SLIM-IT® Model

The Structure element of SLIM-IT employs several processes / mechanisms,
including:
1. Executive Steering Committee (ESC) that directs and coaches the initiative,
ensures alignment and measures engagement.
2. Work Stream Teams that are responsible for an ESC-approved element of
work such as implementing shift start-up meetings or transferring a new
product into a facility.
3. Experts that provide process coaching, an executive sounding board, content
expertise and overall initiative management for the organization.
4. Charters for each Work Stream Team that are developed with and approved
by the ESC. Charters include objectives, critical success factors, activities,
deliverables, responsibility matrices, schedules and so on.
The building block of Lean is the intact workgroup. These are the hands-on
associates who work near each other on similar processes every day. Each
workgroup of ten or fewer people operates its own LDMS that nurtures
improvement and sustains realized gains. LDMS compels, coaches, mandates, and
supports workgroup engagement in applying the correct tools to minimize waste in
their work area.

LDMS consists of six core elements:

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

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

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

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

These five elements, if implemented and maintained, provide a rock-solid

foundation for any world-class Lean program. They provide the mechanism for each
workgroup to take ownership of their work processes.

Lean Daily Management System establishes the involvement

and commitment that are the soul of world-class achievement in
every human group endeavor.
All other Lean tools and techniques will realize only a fraction of their potential if
any of these elements are not implemented and rigorously practiced.

Mentoring is the next element of SLIM-IT. This is the day-to-day coaching of

managers and supervisors in real time, on-the-job, as the tools and techniques of
Lean are implemented. The coaching must be done by those who understand the
why, what and how of applied Lean. Mentoring is the mechanism that assures that
management behaviors at all levels will be changed sufficiently and over a long-
enough period of time to infuse them into the organization’s culture.
Metrics get a lot of attention in traditional organizations but they are often
misguided. The most common problem is an overabundance of them. Second, the
metrics that are most interesting to the top of the organization are often difficult to
connect with the day-to-day work. The Metrics in the SLIM-IT model can be
described in three ways:
 Top-Level Strategic metrics that are the traditional measures of overall
performance: Cost, Asset Utilization, Quality, etc. Here, less is more.
 Micro-process: The metrics that workgroups focus on to steadily improve
their performance. Here, diversity is key – one size does not fit all.
 Activity-based metrics: These are the metrics that must be in place to make
sure that the organization is engaged and aligned. They measure the occurrence,
participation and frequency of the ESC and LDMS along with components
contained within – like the effective use of team-based problem solving
workshops, Value Stream Mapping as something more than a one-time
occurrence and the 20 Keys. Personal performance measures and coaching also
play a role here.

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

Tools, teamwork, training and technology approaches are used by every

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

Attacking People Work

Wastes

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

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

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

Figure 8 – Portions of a Standard Work Instruction (Left) and Standard Work Combination Sheet (Right)
Showing the “Before” Situation in a production cell.
1. Workplace organization, which is intimately involved with standard work,
optimizes a workgroup’s environment through labeling, workplace / tool / part
arrangement and visual displays. 5S, a Lean technique for cleaning and
organizing is usually the starting point for workplace organization. Many
 organizations start out here because it’s easy for people to understand and
natural for them to do. However cleaning and organizing is often the end point
for many Lean endeavors. Visual systems – color coding, labeling, floor
markings, andon lights, etc., are powerful techniques for making Lean part of
the fabric of the enterprise, but they are only part of the system and are not a
one-time event. They must be done with the same discipline and follow-up as
any of the other methods described here.
2. Kaizen, which appears as a separate approach in Figure 5, is actually the
interplay of SLIM-IT with all of the other methods and techniques. It’s both the
spirit and structure of worker participation in a focused manner. Kaizen Events
are structured, team-based problem solving workshops of variable duration.
These are only effective when supported and sustained by a functioning Lean
Daily Management System.

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

The “after” situation in Figure 9 shows significant improvement toward the

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

Attacking Quantity or Material Wastes

Just-In-Time (JIT) methods address the quantity wastes of making too much WIP,
inventory and movement. Some people refer to all of Figure 5 as JIT or Kaizen. While
technically incorrect, the JIT association is frequently made because you cannot
employ JIT techniques to remove quantity waste unless you also address the other
wastes concurrently. The kaizen substitution derives from much the same logic,
although the popularity of kaizen blitzes has made kaizen an all-purpose descriptor
for Lean for many people.
There are four primary JIT methods: kanbans, leveling, Quick Set-Up (also known as
SMED: Single Minute Exchange of Die), and preventive maintenance (PM). We have
already addressed kanbans and work leveling to some extent earlier in the paper.
 Quick Set-Up is a collection of “best practices” that apply standard work and
some machine modifications to changeover activities. A typical SMED study
involves creating worksheets on a changeover and attacking the root causes of
waiting and processing wastes. Reductions of 90 percent or more in changeovers
and set-up times are not uncommon with SMED. Machines must be integrated
into the level work of a JIT approach. If machine set-ups and changeovers take
too long, there will be waiting waste (if downstream parts are not available) or
inventory waste (if large lots accumulate to provide work during changeovers).
 Preventive maintenance is the final JIT method. In a finely tuned Lean
system, unplanned downtime is a bigger problem than in a traditional push
system that is glutted with inventory. When a machine breaks down in a Lean
system, there is little built-up inventory and delivery to the customer is at risk. A
well-structured Lean system has well managed safety stocks to protect the
customer during such repairs. Lean systems train operators to do routine
preventive maintenance tasks such as lubricating and checking so that
maintenance technicians can attend to overhauls, teaching operators and making
design changes to improve machine efficiency.
Attacking Quality
Waste

Error Proofing often referred to by its Japanese name, poka-yoke (pronounced

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

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

The Danger of “Tool-itis”

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

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

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

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

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

**********

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

**********

About Kaufman Global

Kaufman Global is a proven implementation partner that focuses on accelerating

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

20 Keys®, Lean Daily Management System®, LDMS®, Lean Leadership®, SLIM-IT®,

WIN-Lean®, and the Kaufman Global logo are registered trademarks of Kaufman
Global.
Lean Manufacturing White Paper: Part 2
of 3
August 1, 2017/in Tools and Methods, Whitepapers /by Kaufman Global
The following is the second excerpt in a 3-part series from Kaufman Global’s updated
white paper, Implementing Lean Manufacturing: A Holistic Approach. In this paper we
discuss:
 An integrated model for Lean implementation
 How to improve engagement and alignment
 Why “pull” is so fundamental to Lean success
In this installment we discuss why Taiichi Ohno’s original 7 wastes must be updated to
include two new ones: Alignment and Engagement – which if not addressed will foil
any implementation.
Lean Manufacturing Evolves from Traditional Push Systems as Waste
Is Eliminated
Lean is not “installed.” A self-regulating, Lean system is created by a continuous
focus on eliminating small instances of waste or “muda” (muda is the Japanese term
for “waste”). Waste is defined as any work that does not add value to a product or
service. If the customer does not benefit from it, it is muda. All inspections, rework,
repairs, walking, material movement, inventory of any sort, waiting, and so on are
muda. They all cost money and produce nothing of value for the customer. Lean
(pull) slowly evolves from a traditional (push) system as wastes are eliminated little
by little. When an organization first begins to initiate Lean activities, it is a
traditional system with perhaps a few Lean tactics being applied here and there. At
some point, with dedicated effort, it becomes more of a pull system than a push
system.
 Figure 4 – The four categories and nine types of waste (muda)

Figure 4 displays the four categories and nine types of Lean waste. This new model
evolved from Taiichi Ohno’s original three categories; People (work), Quality and
Quantity, and associated seven types of waste. In the late 90s, an eighth waste that
acknowledged the value of people began to appear. That “waste” has been described
in a number of ways, including: intellect, creativity, involvement, etc. In the time
since it has become increasingly apparent that the people aspect still receives too
little attention and prior descriptions have not been specific enough.

Kaufman Global gets more direct by describing the People Energy wastes of
Engagement and Alignment. This draws attention to the elements that must be
overtly addressed in order to make Lean really work and puts a finer point on the
idea of holistic, integrated Lean. It’s necessary to do this because of the almost
insurmountable implementation problems that many organizations encounter.
Their struggles are driven largely by the fact that people energy wastes are not dealt
with as an integral part of Lean adoption. Therefore, we have directly incorporated
people energy wastes, along with ways to minimize them, into the basic conceptual
model of Lean. The specific definitions of each type of waste are described below.

People Energy Waste

 People energy waste arises from a failure to
harness the potential that exists in all workgroups. This form of waste is the most
important thing to address in Lean implementation or any other type of change
initiative. Failure to harness people energy creates most of the significant problems
that organizations encounter when they attempt to do something (anything)
different.

Alignment Waste is the loss of value that arises when management and employees
at all levels are not consistently aligned and energized to address critical issues.
Making this happen is the sole responsibility of leaders and managers who are easily
distracted. Alignment requires conscious and planned strategy and tactics that
ensure messaging is consistent, priorities are established, communication is open
and deviations are explained. “Flavor of the Day” or “Programs of the Month” are
good indications of alignment waste. Good alignment means that you start, and stay,
the course.
Engagement Waste is the loss of value that occurs when people do not have some
control over the work they do. This is one of the toughest things for managers to
abide because they feel like they are giving up some control – which they are. True
engagement means requiring workgroups to measure their performance at a micro-
process level and then expecting them to improve their performance over time.
Many organizations waste a lot of energy on faux-engagement activities such as
coffee talks and lunches with “their people.”

The idea here is to engage and align the organization via well-defined structures. All
the good intentions and skills in the workplace cannot operate seamlessly if
responsibilities, resources and personnel are not formally assigned and led.
Structure requires a formally dedicated steering committee, work stream leaders
and teams, explicitly assigned resources, schedules, charters, and
champions. Alignment and engagement compel two critical outcomes that are
essential change- management requirements for successful implementation:
relevance and ownership.
Relevance: To sustain any initiative, people must work on issues that
are, in some part, relevant to them personally. The most basic and
beneficial aspect of good alignment and broad engagement results
when individuals and teams are compelled to deliver on
improvements and fixes within the processes they control. This
creates, by default, an environment where much of the improvement
activity is truly relevant to those doing the work.
Ownership: Human beings are territorial and proud. If they are
associated with something, it is absolutely essential for them to
believe that it is admired and respected by others. This tendency is
wired genetically into us all. If people are not permitted to exercise
some degree of control and power over their work place, they will not
be inclined to identify with it nor will they strive to make it excel. This
is the underlying basis for the outstanding performance of all self-
directed workgroups.
Concerning all People Waste, understand that it’s not that the people are being
wasteful but rather that these are wastes that are visited upon people by a non-Lean
configuration of work.

People Work Waste

People work waste arises from

human actions involving processes. This type of waste is most analogous to the
waste encountered in industrial engineering concepts. It can be divided into three
categories: processing, motion, and waiting.
Processing waste is the result of inefficient work. Typical causes are inadequately
trained workers, hard-to-use / locate tools or poor-fitting parts. Employees are hard
at work, but there is a better way to do the job.
Motion waste is all movement that does not add value. All walking and reaching for
parts or tools is muda.
Waiting waste is people waiting for parts, help, a machine that is broken or down for
a die exchange, and so on. People can add no value to the product or service while
they are waiting.
Quantity Waste

There are three types of

quantity waste that arise because material (or data or paper) must be processed.
This type of waste comes from creating too much inventory between workstations
(WIP), Raw and Finished Goods inventory and material movement and transport –
think; forklifts, stackers and trucks.

Inventory waste arises when inventory is not being used but has been paid for,
perhaps has had value added to it, takes up space, requires expensive storage and
retrieval systems and becomes lost, damaged and / or obsolete. Finished Goods
inventory is even worse, as all of the intended value has been added and several
weeks or even months may pass before it is paid for.
Work In Process (WIP) waste is inventory somewhere in the system between Raw
Materials and Finished Goods. Whenever there is material waiting between two
processes, it is waste. WIP waste occurs because process times are not balanced and
matched with takt time.
Movement waste is all transportation of materials. Shigeo Shingo, the conceptual
organizer of Single Minute Exchange of Die (SMED) and poka-yoke (error proofing)
concepts, humorously observed that forklift and conveyor salespeople must
routinely bribe traditional plant managers. Why? Because, he jested, no other
mechanism could explain the incredible amount of unnecessary movement built
into the processes of non-Lean plants.
Quality Waste
 Fixing defects is the sole quality waste. Each
defect turns value-added work to waste and requires more nonvalue-added work to
be repeated during rework or repair. Prior to the implementation of Lean, quality
waste is usually the most visible waste due to its impact on customers and the
tendency of a traditional push system to fail to recognize the other types of waste as
significant. Ironically, reduction of the other wastes through Lean always results in a
dramatic decrease in defects. This occurs even without the focused implementation
of powerful tools such as error proofing or Six Sigma.

The next section presents an integrated discussion of Lean tools, concepts and
implementation techniques. The tools and methods should not be separated from
the implementation approach. While this paper does not provide a detailed
examination of Lean tactics, it does present sufficient information for the reader to
determine what they must learn in order to develop a successful Lean
implementation initiative in their organization.

Implementing Lean Manufacturing

As muda is eliminated through the application of various Lean tools and methods, a
pull system gradually emerges. Figure 5 presents the Master Jargon Chart of Lean
Manufacturing. The Master Jargon Chart summarizes and presents the various Lean
wastes, tools and methods into a single conceptual framework. Figure 5 is Lean; that
is, in order to “do” Lean, the waste reduction approaches and corresponding tools
and methods shown there must be comprehensively applied in an integrated
manner.

All of these tools and approaches need not be implemented simultaneously. In fact,
it would be a mistake to do so. Further, the criticality of each tool varies in different
environments. This is why a “one-size-fits-all” Lean implementation is a mistake.
While all successful Lean organizations use many of the tools to some extent,
various tools are more comprehensively applied in certain environments than in
others. As we discuss specific tools and approaches, this will become obvious.
 Figure 5 – The Master Jargon Chart of Lean

The left two columns of Figure 5 present the four categories and nine types of waste
described earlier. The structure of this model might suggest that each waste
category is targeted by a specific approach and / or method. While this is true to
some extent, all of the methods are extensively interdependent and interactive. You
cannot “cherry pick” tools and techniques and expect long-term Lean success. In
particular, if you do not employ the methods required to address people energy
wastes, the other methods will fail to achieve competitively meaningful results.

——————————————————————–
To be continued. In Part 3 of this series, we provide describe a fail-proof system for
implementation. Or, if you’re ready to read the entire white paper now, click
here to download.

Lean Manufacturing White Paper: Part 1

of 3
July 23, 2017/in Tools and Methods, Whitepapers /by Kaufman Global
The following is the first excerpt in a 3-part series from Kaufman Global’s updated
white paper, Implementing Lean Manufacturing: A Holistic Approach. In this paper we
discuss:
 An integrated model for Lean implementation
 How to improve engagement and alignment
 Why “pull” is so fundamental to Lean success
In this installment: THE EVOLUTION OF LEAN AND WHY PULL IS SO IMPORTANT, we
describe the foundations of Lean over the past half-century and why pull vs push is one
of the most fundamental aspects of any Lean system.
Part 2 discusses why Taiichi Ohno’s original 7 wastes must be updated to include two
new ones: Alignment and Engagement – which if not addressed will foil any
implementation.
Part 3 provides an easy to understand table that shows the systemic nature of Lean:
wastes, approaches, methods, tools and results and describes a fail-proof system for
implementation. For over 20 years Kaufman Global has pioneered the interface
between people and process, always with engagement and alignment at the core.
The Evolution of Lean and Why Pull is so Important

Kaizen is a Japanese word that means “small, ongoing good” (kai) and
“good, little, for the better” (zen). The term has come to mean small,
continuous improvements by hands-on workers all the time.

Introduction
Lean manufacturing has become synonymous with world-class operational
excellence. Under various names (synchronous, pull, demand flow, flexible, cellular,
just-in-time, one-by-one), Lean is the single most powerful strategy for improving a
production operation’s competitiveness. The dominant players in every market
segment are aggressively implementing Lean as a strategic weapon because they
realize they have no choice. If they don’t “do Lean” and stay Lean, they will quickly
fall behind the market leaders because they are less able to adapt to an ever-
changing competitive environment.

This white paper is directed at organizations that are either eager Lean
practitioners or those who have not yet had a Lean awakening. Both will find value
in its explanation of the foundations and basic mechanics. Additionally, this paper
describes Kaufman Global’s specific approach to Lean implementation and our
learnings over years of working with clients. Our method is holistic and pragmatic,
reduces implementation time, increases benefits and ensures sustainability.
Kaufman Global has pioneered several techniques that are in wide use across a
broad spectrum of industries and business today, including: the SLIM-IT® model for
implementation, Lean Leadership®, the 20 Keys® and the Lean Daily Management
System® (LDMS®).
A Definition of Lean Manufacturing
Lean manufacturing, or Lean, is an integrated leadership philosophy, management
system and set of tactical methods / tools that focuses on creating an operation with
minimal amounts of nonvalue-added activity, inventory (Raw, Finished and Work-In-
Process) and errors. The primary engine for eliminating nonvalue-added elements
in Lean system is the employees who do the hands-on work.
The Benefits of Lean
While the mechanics and approaches of Lean may not be clear to everyone, there is
little doubt concerning the magnitude of potential benefits. Years ago, in order to get
people interested in the notion of Lean, it was necessary to quote double digit
percentage savings from process improvement. Without making that list here, in our
experience any process is capable of a 10 – 30% improvement if Lean is applied
with some rigor. This is in any and all dimensions whether it be cycle time, lead
time, quality, inventory, customer satisfaction, absenteeism, etc.

Results like this cannot be attained by chance or half-hearted, informal initiatives.

They can only be generated through carefully planned and aggressively supported
efforts that are overtly led by management. Isolated improvements have no chance
of leading to an organization-wide transformation of day-to-day behaviors,
expectations, metrics and the entire system of work.

The Evolution of Lean Manufacturing

Figure 1 is a conceptual diagram showing the progression of Lean between the
1940s and today. Lean would not have emerged as a structured system when it did
(or at all, perhaps) if it had not been for two circumstances. The first was the
condition of Japan after World War II. Totally devastated and with few resources,
Japan could not compete with other industrialized economies on costs, volume or
quality using standard mass production approaches. There wasn’t enough money to
build modern factories or buy modern equipment. Japanese manufacturers had to
“make do” with what they had; and they had very little. This massive handicap
created the ideal conditions for the true catalyst of Lean to operate.

This second circumstance was the pioneering thinking of Kiichiro Toyoda, Taiichi
Ohno, and Shigeo Shingo. Their focus on low-tech, pull systems and the elimination
of waste evolved into the Toyota Production System (TPS) over the period from
1945 to about 1975 (the original, Toyoda, was changed to Toyota for American
consumers). The 1990 book, The Machine That Changed the World by James
Womack, et al, popularized the term Lean manufacturing to refer to the TPS and its
derivatives. Other generic names for the TPS are flexible, cellular, one-by-
one, pull, synchronous, demand-flow and World-Class manufacturing. Also used
are just-in-time and kaizen although both are only elements of the TPS, not the entire
system.

Starting in the mid-1980s, the large automobile manufacturers adopted many of the
basic principles of the TPS, but each changed the name to something that sounded
more “home grown” to their employees, customers and shareholders. Other
companies have since taken the same approach. Thus, it is common to find that
Company X has the “X Production System” in place. Peel back these “labels,” and you
find significant elements of the TPS underneath.

During the 1990s, it became apparent that there was plenty of room for Lean
application far flung from automotive assembly and well beyond the factory floor.
This started the integration of methods and techniques that is still going on today –
Office Kaizen is one example. As organizations from all industries, sectors and
segments embraced adaptations of the TPS, new tools and methods were developed
and Lean continued to evolve.

In the mid-2000s, the term operational excellence or “OpEx” started becoming the
popular catch-all phrase for operational improvement of any kind. It allows for the
inclusion of a multitude of techniques – especially the integration of Lean and Six
Sigma – and is often more acceptable to the ears of those in non-manufacturing
pursuits. The generality of the term is also its weakness because anyone doing
anything to improve performance can proclaim they have OpEx – which may or may
not be true.

While the basics never change, the Lean of today has many additional bells and
whistles that Toyoda, Ohno and Shingo did not develop but would have welcomed.
Anything that enhances the fervent elimination of waste is part of Lean.
 Figure 1: Where Did Lean Manufacturing Come From, Where it is Going
Pull Versus Push in Lean Manufacturing
A critical distinction between Lean and traditional systems is the pull philosophy of
Lean versus traditional manufacturing’s push philosophy. Figure 2 displays the
mechanics of a typical push system with three employees working on three
consecutive processes. The curved arrows represent sequential actions of each
process step. In this example, each of the three workers does his / her work at the
same time independently and then passes the completed item to the next worker.
We assume that each worker performs each and every task at a constant rate of
speed.

Figure 2: A Conceptual Representation of a Push System

The “start” scenario illustrates the situation in the cell as it has just started to work
on a new product. The Process A worker has four pieces of Raw inventory waiting to
be worked. There are also four pieces of Work-In-Process, or WIP, waiting for both
the Process B and Process C workers. Each worker has one piece of work at their
station. There are four pieces of Finished Goods waiting to be picked up after
Process C. In Figure 2, the processes are not balanced. We know this because the
workers, operating at a constant rate of speed, require different amounts of time to
do their work. Takt Time (TT) is noted for each process. Because at least one of the
workers is over the Takt Time (TT), it will be impossible for the three-person
workgroup to meet customer delivery demands unless additional resources in the
form of time or people are added.

Takt is the German word for “cadence” or “rhythm” (pronounced “t-ah-

k-t” in German but typically pronounced “tack” in English). In the TPS,
Takt Time is the heartbeat; it is the standard time interval between the
each output of a product from a process that is required to meet
production demand.
TT is obtained by dividing the total amount of work time in a day or shift by the
required output. That is: Takt Time = total time in seconds / required output. The
bar graph below each process represents the amount of actual time that each
worker requires to perform their work to the product.

The rate of completion of work for each process varies because the work is
unbalanced: Process C takes the longest, B is the fastest. Process A tasks are the only
ones that match the Takt Time exactly.

After some period of time operating under the typical push philosophy, the original
“start” situation has evolved into the “later” example shown in the bottom half of
Figure 2. With a starting level of four pieces of inventory between each worker,
Worker B frequently ran out of material because they are out of balance with the
preceding process (A). The supervisor or manager, uncomfortable at seeing an idle
worker and believing that any work is better than none, ordered that more
inventory be added so that Worker B could stay busy. This typically happens as
managers strive to make “earned hours” or “standard labor hours” look better. If the
workers in Processes A, B and C are operating machines, the quest for better
“absorption” numbers creates additional pressure to build up inventory.

Raw material accumulates with Worker A because it is pushed to the operation by

Materials Management and Production Control. More and more inventory is added
until all workers are kept busy all the time. The result is masses of inventory of all
types – Raw Materials, WIP and Finished Goods. Upon seeing busy workers and a lot
of inventory, managers receive the false perception that considerable value is being
added and that there is a lot of product almost ready to meet customer demand.

The total output of the combined processes of cells A, B and C can only ship at the
rate that Process C can complete the work. If any process downstream has a
problem, other upstream processes will continue to churn out inventory. All of the
WIP and Raw inventory is irrelevant to meeting customer requirements. All of the
labor that is added to inventory that cannot be shipped is waste – and no, it is not
“pent-up value.”

Worst of all, because everyone appears busy, the issue of unbalanced work between the
three workers and the inability of the cell to meet takt time is seldom addressed.
This is the root cause of the entire inventory buildup. Rather than focusing effort on
balancing the work in the cell, the push reaction is to resort to overtime, more
workers, more expensive equipment, or all three.

Note the diagonally striped squares that appear in the “later” scenario of Figure 2.
These are “problem” assemblies: a part was bad, an assembly error was made and /
or a component was missing. When one of these problems occurs, the unit is pushed
off to the side for later assessment. However, in most push systems, these problems
are rarely addressed — and, when addressed, never timely. With the organizational
imperative to stay busy and make more, the problem units appear insignificant
among so much other inventory.

Figure 3 presents analogous “start” and “later” scenarios for a pull system. A
detailed examination of demonstrates the power of a pull system to overcome the
problems created by the push approach. In the “start” configuration, the times for
each process to complete one unit are identical to those in Figure 2, as is the TT.

The first thing noticeably different about Figure 3 is that there is little inventory.
This is not something that happens all at once when transitioning from the Figure 2
push system, but is a gradual result of moving towards a pull system. The second
major difference is that the three processes do not work independently. Work is
always “pulled” from upstream.
 Figure 3: A Conceptual Representation of a Pull System
The pull begins when the completed unit at station one (1) is removed. This creates
an empty spot, which generates a need that pulls the completed unit from Worker C.
This pull message is called a kanban(denoted by dotted box in Figure 3).
Kanban in Japanese, originally meant “store sign.” It is said that
Kiichiro Toyoda got the idea for the pull system from a visit to a US
supermarket after World War II (goods pulled off the shelf today are
replaced tomorrow). In reference to what he had seen, he called a pull
signal a kanban (rhymes with “bon-bon”).
A kanban can be a spot on the floor, a pallet or a piece of paper attached to the
material or the material’s container. Traditionally, it was a card or sheet placed in a
see-through pouch. The kanban states what it can accept.

For example, if a pallet is the kanban and a pallet can hold 16 assemblies, Worker C
could continue to place work on the kanban until it has reached its limit of 16.

At that point, no more units could be added to the kanban. Worker C would have to
stop working after completing the unit in front of him and wait until the kanban was
emptied. In our example, the kanban only holds one piece. If the downstream
kanban is full and Worker C has completed work on the at their station, they must
stop working and wait. Nothing can move without a kanban, only Production
Control can create new ones.

The beauty of the pull system is that if there is a problem at a downstream process,
the entire line stops. No worker is permitted to work on another unit and / or build
up inventory unless a kanban arrives. The “later” scenario in Figure 3 shows that the
three processes are more balanced than at the “start” scenario. In a pull system,
there is a continuous effort to balance work between adjacent processes workers
and cells to eliminate waiting and reduce WIP inventory.

Also note that there are no problem units in the later scenario. Since inventory is not
pushed along the production sequence, each problem unit in the pull scenario
creates an “empty spot” in the process chain that cannot be hidden by WIP
inventory. Management and employees are energized to address problems by the
very nature of the pull system. As a result, errors decrease and quality improves.

**********

To be continued. In Parts 2 and 3 of this series, we update Ohno’s original waste

wheel with the most dangerous waste of all: people energy and provide an easy to
understand table that shows the systemic nature of Lean: wastes, approaches,
methods, tools and results. Then we describe a foolproof template for
implementation. If you’re ready to read the entire white paper now, click
here to download.
Operational Excellence Will Save You
Millions (and Millions)
November 29, 2016/in Tools and Methods /by Kaufman Global
Well… the exact number is not certain, but organizations could get much more from
their OpEx by shifting perspective.

Operational excellence is another way of saying “comprehensive

process improvement.”
As an enterprise function it’s better than ever. Across business and industry
(government, healthcare, services and manufacturing) it delivers year-over-year
benefits. Yet, results could be much better. Many of the Operational Excellence
(OpEx) programs we encounter are too narrowly defined and treat OpEx simply as

deployed resources with some useful tools.

A broader definition recognizes operational excellence as a result and OpEx as a

system that affects the entire enterprise. It’s not an overlay, but rather a cohesive
network of people applying standard techniques to deliver and improve results.
The OpEx Function Emerges
In the mid-90s, OpEx programs began to emerge from their automotive heritage,
branching into other settings where they were perceived to offer a return on
investment. Many of those efforts fell under the headings of Lean and Six Sigma. The
basic concepts of process improvement have changed little over time but there has
been such a proliferation of techniques and jargon that it can be a little confusing.
Now we use terms like Continuous Improvement (CI) and Operational Excellence
(OpEx) as a catch-all for anything related.

A few major themes are part of any OpEx endeavor, such as: what it works on, the
techniques applied and how its organized. These attributes can be designed-in, or as
is often the case, derived incrementally and ad hoc. This happens when one part of
the business tries one approach, while another faction tries something different.
Instead of resolving to a standard, the outcome is often the ‘tyranny of the OR’
where it’s hard to discern what is working and what is not. “Are we doing this, or are
we doing that?”

Let’s look at these three themes in a little more detail.

What OpEx Works On

OpEx has two modes:

1. Reaction – Responding to the most pressing issues of the day in areas such
as productivity, quality, service and customer satisfaction.
2. Prevention – Focusing on incremental improvements and sustaining;
including process adherence and change management.
This is the right combination, but it’s pretty easy for organizations to get stuck in
reactive mode and think of OpEx people as fire fighters whose main job is to put out
fires instead of prevent them. This weakness can contribute to the downfall of OpEx
when times get tough. Then, the biggest issue may be cutting cost and OpEx is often
a cost that gets cut early. The up and down behavior makes it even tougher for the
OpEx function to take off each time there is a restart.

Operational Excellence Techniques Applied

Tool kits includes things like: Lean, Six Sigma, manage change, coach, facilitate,
deploy policy, map value streams, define standard work and conduct kaizen events
and workshops, etc. That’s a pretty big list. Organizations often attempt to include
too many tools and end up doing few of them well. Efforts can feel disjointed
because they are. This is an area where the need for tool selectivity and standards
guided by OpEx governance is obvious, but often lacking.

Differences in techniques applied across various industries have less to do with type
of industry and more to do with the plethora of opinions, experiences, and
competing priorities. For sure, a variety of techniques are expected and one size
does not fit all. But wherever people and process come together, while the
vocabulary and examples change, waste elimination and variation reduction
methods don’t differ too much. Moreover, the methods and structures that deal with
behaviors, engagement and change management are always the same.

How OpEx Is Organized

Maybe the most obvious shift in recent years is the rise of OpEx as a legitimate
internal function. This means that, at the very least, people are identified on an
organization chart. Assigning resources is a good thing, but the amount of variability
in how talent is applied suggests too much experimentation. Models include:

 Corporate Owned – Resources are sponsored by headquarters and mostly

directed from there
 Operating Unit Owned – Resources are sponsored by and embedded within
the operating units
 “Spray and Pray” – Broad skilling of associates without requirements for
immediate application
 “Hammer and Nail” – Attack obvious problems with available resources,
often with limited tools and experience
 In practice it’s typically a combination of all of the
above. The ratios shift over time as organizations learn and politics play out.
Striking the right balance is essential for OpEx effectiveness. Articulating
governance, communication and how people engage are all critically important.

A Systems View
The themes noted here – targets, techniques, organization – should be familiar to
anyone who has worked on or inside of OpEx. It’s easy to get caught up in
organization charts, tools and the “fires”. When this happens, focus narrows and we
miss the opportunity to engage broadly across the entire enterprise.

Operational excellence is not a function. It is a RESULT that is best achieved by an

OpEx SYSTEM that engages everyone.

Effective OpEx systems balance corporate and operating unit needs, target urgent
problems and prevent others from ever occurring. They define, and then use,
standard work to get things done. Reporting, capturing best practices,
communication and sharing information is described, done and enforced. These are
the things the OpEx function should be working on.

Broad organizational involvement and commitment is perhaps the most obvious

benefit of a robust OpEx system. Leveraging the knowledge and input of those
closest to their work shows respect for people and drives decision-making to the
lowest possible level – a key tenant of an improvement culture. A fully engaged
organization achieves relevant results, gains traction and becomes a sustainable
continuous improvement engine. When the OpEx system is designed and defined, its
performance can be evaluated and improved. A good OpEx system is:

 Simple – The easier it is to understand, the easier it is to see if people are

doing it
 Engaging – Everyone participates. Ownership and expectations are
articulated
 Actively Managed – Leaders are hands-on in guiding the change process
 Structured – The way the organization is expected to interact is clearly
defined
 Don’t over-complicate it. Too many rules lead to
unwarranted bureaucracy and can kill beneficial creativity. If design and definition
become the major focus, no one will ever get out of the blocks and actually start
fixing things. Balancing standard requirements with creative and flexible problem-
solving is one of the great challenges. Sorting that out creates a sense of ownership
and develops the organization.

As people should be at the heart of any OpEx system, start by describing the critical
few things that demonstrate personal participation and then link these elements to
recognition and reward. This is just one of many small steps that the enlightened
enterprise goes through to become operationally great. It can be done once leaders
decide that operational excellence is a literal objective and OpEx is a system for
engaging the organization instead of a check the box function or a quick-fix for the
crisis du jour.

Want to read more on topics like this? Head over to our Knowledge Center to get
access to our full catalog of white papers.

Rapid Performance Evaluation – Speed

Matters
August 4, 2016/in Tools and Methods /by Kaufman Global
Rapid Performance Evaluation: Standard Work for Identifying
Operational Performance Gaps
Kaufman Global helps clients solve complex problems and drive fundamental
improvement. We engage when people and process collide – places where expertise
and leverage can speed results. Even when an organization knows there is a
problem, understanding operational performance, getting to solutions and knowing
which levers to adjust can often benefit from outside perspective.
 Over the past few years, we’ve observed
that clients want answers faster than ever before. And while it could be that “time is
money,” it seems to us that it’s more related to the frenetic pace of, well, everything
these days. Headlines and “apps” often don’t dig deep enough and the “Ready, Fire,
Aim” approach has great potential for missteps.

To meet the demand for fast but thorough answers, we devised an innovative
method for quickly getting to the heart of the matter – operationally and
organizationally. Our Rapid Performance Evaluation(RPE) uses a standard work
approach to cut the time required for credible solutions to about a day. How, you
ask?

Instead of only identifying and prioritizing process problems, the RPE delivers
tangible feedback and scores that can be used to immediately take action to
improve. The RPE:

 Provides a comparison against well-defined standards and benchmarks

 Ensures the leadership team is aligned on the issues
 Establishes specific and prioritized things to work on now
 Engages the organization out of the gate, reducing rework and improving
data fidelity 10x
 Is fast and agile – minimizing disruptions. Getting accurate info doesn’t have
to take weeks

The process begins by on-boarding the team and communicating with site
leadership. It ends with a report to same. Core attributes of the Rapid Performance
Evaluation are noted below.

Visit the Gemba

The gemba is the place work is done. It’s the shop floor, the office, the warehouse,
the lab or the medical unit. It embodies the concept of “Go look, go see” and is a vital
step in collecting information for analysis. We’ve found it helpful to review
immediately before the visit what we’re trying to “see”, so we use a standard set of
definitions to focus our attention. For example, in an office environment one thing
we look for is communication between functions. In a factory we want to
understand how material is moved (pushed or pulled) and stored (inventory) from
one location to the next. Lots of paperwork is not needed for reference. Our optics
have been adjusted ahead of time so the visit to the gemba can be for observation
and understanding. We need to keep our eyes and ears open.

Template Driven for Simplicity

Templates are used to compare existing practices to best known practices. With the
RPE, simple but proven definitions and an intuitive measurement system make it
easy to get everyone on the same page when it comes to scores and ratings. We look
at factors that correlate to overall performance, such as quality systems, teamwork,
continuous improvement capability and material and information flow. The
correlation factors provide a big-picture view and point to overarching or systemic
causes affecting performance.

For more discrete aspects of the operation, we use the Kaufman Global 20 Keys ® to
evaluate 20 critical elements that affect efficiency and effectiveness. For each key,
the tool ranks the current level of performance using a 5-point scale where 1 is
“Traditional” and 5 is “Currently Invincible”. Levels are described simply so the
requirements for achieving the next level of performance are easily understood. The
20 Keys dig a little deeper than the correlation factors by identifying and prioritizing
specific things to work on.
Alignment Speeds Change
No matter how good the templates and rating systems are, they don’t account for
the human factor. Opinions matter. During the course of the visit we interview key
leaders and stakeholders. This usually means functional heads who have valuable
insights and who will play a critical role in any changes moving forward. We start to
see how much (or little) agreement there is about the underlying issues. This is an
area where being external to the organization is a key advantage. Functions are
typically protective of their turf. Outsiders can ask more probing questions. If there
is a significant difference between what we hear from the leaders and what we see
on the ground, we sometimes opt to survey the organization. This can help identify
broader organizational issues.

Balance Speed and Accuracy

The RPE is done with a small joint team comprised of Kaufman Global and the client.
Since the method is standard, well defined, intuitive, and template driven, training
for the client participants can be completed at the start of the day. The real benefit
of this simplicity becomes clear at the end of the day when scoring begins. After
we’ve completed the tour and interviews, we individually rate and rank based on
our personal observations. Then, we come together to discuss and negotiate
consensus results. The evaluation is better because it consolidates multiple views,
experiences and vantage points and compares actual performance against intuitive
and easy to understand benchmarks.

Results
Any operation can be assessed for performance quickly if the method considers all
of the output requirements and integrates change management approaches. The
RPE gives leaders rational ratings of performance, a clear understanding of
organizational challenges and confidence that they’re spending energy in the right
places.

Find an example of the approach and results here: Rapid Performance Evaluation
(RPE) Case Study: Automotive Electronics.

4 Tips To Simplify Work Complexity

November 3, 2015/in Tools and Methods /by Jerry Timpson
Complexity means more options for failure.

People and processes come together to deliver

products and services. Like a ball of string collected, complexity builds as things are
added to accommodate the dynamic environment: organizations, procedures,
technologies, reporting, etc. This “growth” happens incrementally and naturally in
every business. Simplification can overcome complexity, but it takes energy to
accomplish.

When two entities merge and attempt to integrate, the chaos is more obvious. Either
way, the interactions are seldom or appropriately examined to determine what can
be eliminated. Ultimately, the patchwork of fixes and micro-solutions generate
systems that are more complex than they need to be. They are difficult to
understand, standardize and control.
Complexity doesn’t automatically resolve itself. Some organizations endeavor re-
design from time to time, but the work is typically limited in scope and stays inside
functional boundaries. Here, there are plenty of examples of success in areas like
Finance, Manufacturing, Product Development, etc. When we explore enterprise
value streams that cross boundaries―for example the alignment of Sales, Product
Development and Production, it gets a little tougher. Even so, opportunities to
improve competitiveness are vast, therefore it makes sense to take a broader
approach and navigate the stream through the enterprise. Results are more assured
when the initial work is well planned and executed with precision.

1. Inclusive Workshop Aimed at Reduction

A structured workshop is the best way to begin. This may be a single event or a
series of sessions. It goes beyond getting a few people together to compare ideas.
Top considerations are:

 Leadership engagement (governance)

 Simplification Team participants and
 Implementation imperatives.

To determine scope, start with the system of people and processes that you have;
the current state. Some will argue it’s better to begin with a clean-slate, but really,
there is no such thing. In rare situations where there is no process to begin with,
gaining a systems understanding without preconceived notions is more or less
impossible. Besides, in most cases, products or services are already flowing. So start
here to decipher the variables that are adding value.

2. Governance and the Politics of Change

Once you’ve got an idea about the scope of work, it’s time to get the right leadership
engaged. First, determine the major processes and or functions that are part of the
system. Then identify the single point of control for all of them. For many
organizations, the control point for value streams that bisect the enterprise is the
CEO. This isn’t so surprising when you consider the rich mix of silos, shared services
and dual reporting structures that exist within most organizations. Single-point
control at high levels is the main reason simplifying enterprise value streams is
difficult, and why we often settle for optimizing functions or sub-processes. Don’t
settle.

The control point then directs the functional leaders to participate by forming a
coalition to govern the progress of the workshop (and beyond). This direction is the
catalyst for action and it is a critical step. The task often requires more effort than
initially expected, so be prepared with enough up-front work to make an effective
case for change.

3. The Simplification Team – Dealing with Data, Facts, People and

Emotion
The workshops are staffed by individuals who work inside the existing system and
therefore understand the most about what it delivers and how it functions. They
also tend to defend the status quo but will probably be part of the change moving
forward, so get them involved them early. You’re digging into things that people
have built over time. Don’t underestimate the work required to keep this team
motivated and on track.

Include some who don’t operate the existing system to get an unbiased view and to
ask the “obvious” questions. In the ensuing conversations, you’ll hear “You don’t
understand.” a lot – which is exactly what we want. Through these interactions, the
team gains clarity about the system as a whole, instead of just their part of it.
4. Consider What Comes Next
The workshop decision is taken, simplification is an objective, the processes and
people are known and an accountable Steering Team is enlisted… all good. So far the
task at hand doesn’t seem too daunting. Now, as part of the workshop, go beyond
simplification design and consider implementation. What will it take to
operationalize the changes?

Workshops get things rolling by providing an output that describes processes at a

high level. As the future state becomes current state in the real world, change is
managed and kinks are worked out in-situ. The new system is built by standardizing
processes as they emerge and then attaching and adhering to relevant procedures.
Don’t add complexity back in by over-prescribing. Simpler definitions are more
likely to be adapted, provide fewer options for things to go wrong and give more
room for value-driven decisions to be made at the right level.

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

Complexity happens naturally. Simplification does not. People are frustrated

working in bloated, ineffective and inefficient systems. There are no silver bullets,
but smart design is a great starting point. Use an inclusive, holistic approach to
extract solutions, identify value and restructure the work. Then engage the
organization for extraordinary results.

World-Class Performance and the 20

Keys
November 3, 2014/in Tools and Methods /by Kaufman Global

The 20 Keys are a powerful method for first assessing current state performance in
operations, and then developing an action plan for improvement.

What is World-class?
world–class
adjective
: among the best in the world
: being of the highest caliber in the world <a world–class athlete>

Source: Webster-Merriam.com dictionary

What does the phrase “world-class” really mean? This question has been asked since
the term first became popular in the 1950s. Companies that are considered to be
world-class consistently exceed customer expectations. This type of performance
isn’t accidental. It requires systems that adapt to dynamic environments. Kaufman
Global frequently uses the 20 Keys system in our work with clients that are pursuing
world-class performance.

The 20 Keys Help Organizations Focus

Lean is an important element in the pursuit of world-class. The simplest definition
of Lean is: “The relentless pursuit of waste elimination.” Regardless of business type
or industry, many companies have great success with their Lean efforts.
Unfortunately countless others don’t. Maybe this is because there are so many
opportunities to eliminate waste that it’s easy to get distracted, lose focus and
wander off course. This isn’t a new problem. Decades ago Iwao Kobayashi at Toyota
evaluated manufacturing companies that were considered to be world-class and
identified crucial areas that must be addressed in order to achieve such status. He
categorized these areas and put them into a framework called the 20 Keys.

Kobayashi’s original Keys addressed an entire manufacturing facility. Kaufman

Global expanded the concept by developing sets of 20 Keys for many functions such
as Healthcare, Engineering, Supply Chain, and Finance, among others. We then
integrated the technique into our Lean Daily Management System® (LDMS®)
methodology so that measurement takes place at the work group level.

The Kaufman Global 20 Keys® methodology:

1. Is a continuous improvement mechanism that combines intuitive world-class
definitions with a means of measuring and scoring group performance
2. Focuses intact teams on the issues that affect their work
3. Can be implemented and linked across the organization to provide a
comprehensive evaluation of effectiveness
Strategy and Tactics
At first glance, the 20 Keys may seem like another audit technique. But when this
powerful system is deployed inside the Lean Daily Management System, it enables
work groups to take increased ownership of their daily work. As an added benefit,
these highly relevant, local improvement efforts can be rolled up into organization-
wide results by providing a common measurement system amongst multiple
locations. The graphic below shows how the 20 Keys works both strategically and
tactically, linking the big picture goals of leadership to improvements in day-to-day
work. The 20 Keys takes an organization’s vision of world-class and:

 Connects the vision to actions by breaking it down into manageable pieces

 Provides an easy to understand and manage measurement system for
progress toward the vision
 Enables relevant improvement plans close to the issues
Work group Application
Once the vision and strategic priorities of the organization are set, intact work
groups complete a 20 Keys assessment and planning cycle to baseline their
performance. Each key is evaluated at five levels of performance, ranging from 1
(Traditional) thru 5 (Best-in-Class). There are no ½ points and all statements or
requirements must be met in order to achieve a given performance level.

With the baseline score established, the team selects their initial improvement keys
and goals and creates a plan to achieve the gains. For example, if Safety was one of
the keys identified for improvement and the current level of Performance was a 3,
the team would be meeting the following definition:

 Safety – Level 3: The concept of unsafe behavior is well understood and

associates are familiar with the specific unsafe behaviors that create hazards and
/ or accidents in their area.

To improve their score and achieve the next level performance, the team would
need to establish new work rules and processes that ensure all Level 4 criteria were
consistently met:

 Safety – Level 4: Unsafe behaviors are audited weekly and the results are
posted. The team strives to eliminate root causes of unsafe situations and it is
accepted practice for associates to coach each other on safe behaviors.
Regardless of whether the team sets an annual improvement goal of 10 points, or a
quarterly goal of three points, it is important that they assess their performance
against the plan at least every three months to ensure the action plan is being
implemented and progress sustained. Posting the 20 Keys scorecard and
implementation plan in the work area on the primary visual display enhances
visibility to improvement progress and is a best practice.

Building the Foundation for World-class

World-class levels of performance are not achieved by accident, but through the
execution of an incremental and strategic implementation plan. Kaufman Global has
helped many organizations implement the 20 Keys and focus their improvement
efforts. If you’ve already established a good foundation of continuous improvement,
or even if you’re just starting the journey, the 20 Keys is a good way to enhance
results and sustain momentum.

**********

To learn more about how to apply the 20 Keys and achieve world-class levels of
performance, click here to download our Evaluating Continuous Improvement
Effectiveness with the 20 Keys white paper.
The 20 Keys are part of Kaufman Global’s Lean Daily Management System ®.
The 20 Keys are discussed in this article: The Missing Link of Lean Success.
Relearning Jidoka From a Robot Vacuum
Cleaner
July 9, 2014/in Tools and Methods /by Kaufman Global

About 20 years ago, when I first trained on the Toyota Production System, it was
presented to me that the second pillar of the Toyota production system was
“Jidoka”. Jidoka is a Japanese word that means “automation with a human touch”. As
I learned later, this definition just does not convey the quality concepts embodied in
Jidoka. I admit, I had difficulty learning the Jidoka pillar because I got stuck on the
word automation. I thought it was a call to automate processes with numerical
control.

My Japanese Sensei explained that American Lean practitioners use the word
“autonomation” instead. Hmm … sorry … not getting it. Still sounds like automating
something to me. Later, during a plant tour, the Sensei pulled our group aside to
show us a u-shaped manufacturing cell with 12 machines being operated
simultaneously by a single operator. The operator’s job was to unload and reload a
machine, press the start button, carry the processed part to the next machine,
unload that machine and load the part from the previous machine, press start … and
so on, for the entire circuit. Ah hah! The light bulb came on! Autonomation means
achieving autonomous operation of a machine; getting it to run autonomously and
make good parts, without the necessity for a human to stand there and watch it.

Back to the present. Last fall my wife and I saw numerous TV commercials
promoting a robot vacuum cleaner. My wife thought it would be neat if it really
worked. I remembered this at Christmas time and decided to surprise her with the
thing she had commented on months earlier. She was indeed surprised, but not the
way I expected. She immediately asked if I had problems with the way she cleaned
the house!? (Key learning point: Don’t give your wife a vacuum cleaner as an
unexpected gift.) Once I
got through that minefield, I skimmed the instructions and we picked the first room
to clean. I positioned the electronic boundary beacon in the doorway, plugged in the
base station, set the robot, pressed start and let it go. Fascinating! The robot started
off in a random pattern throughout the room. When it bumped into something it
stopped and turned in another direction. It remembered the walls and furniture it
encountered and explored their boundaries. It was a big hit. My wife thought it was
cute and fun to watch! Having redeemed myself, I left her to enjoy her gift.

Twenty minutes later I checked on the robot and found my wife still watching. “So
what do you think?” I asked.

She replied, “Well it saves me physical work but it does not save me time. I can do it
faster myself. I could be done and on the way to the store by now.”

“What’s stopping you from going to the store?”

“I have to watch it.”

“I can see you are fascinated by it, but why don’t you let the robot do its work and go
do something else?”

“It might do something wrong. It could get stuck, fall down the stairs, or make marks
on the furniture. It might miss some spots.”

“Have any of these things happened so far?”

“Well, no. When it went into the corner and bumped the walls it rotated until it
found a path out. Same thing around the furniture.“

“How about the stairs?”

“It started to go past the edge, then stopped and backed up.”

“OK, so it detected the ledge and responded to prevent it from falling down the
stairs. Hmm… I wonder what would happen if it got stuck under the couch or got in
a tight spot?”

We positioned a chair over the vacuum so that it was penned in. After a few
attempts to free itself, the robot stopped. It beeped a few times and a recorded voice
said “error, error”. I removed the chair, pushed the blinking start button and it
started vacuuming where it left off. A few minutes later, it drove onto the base
station, beeped to signal it had completed the room and turned itself off. I could tell
from observing the wheel patterns in the carpet the vacuuming job was complete
and no sections were missed (visual management).
This suddenly felt familiar. “You know,” I said, “the vacuum cleaner is a machine
designed to do a process that humans do. To be effective it must be able to detect
exceptions and respond, so they don’t become problems or continue as work
defects.” I continued, “For the vacuum cleaner, the response may be a
countermeasure such as turning or backing up, or shutting down and signaling that
human intervention is required to resolve a problem.” In essence the machine has
been equipped to sense problems and make some human-like judgments
(automation with a human touch). It has sensors to detect when it runs into
something or may run off the floor, and they tell the computer processor a response
is required (detect abnormalities). We saw the machine making these adjustments
and we tested it for its response to a problem (stop the line for quality problems).

I asked my wife if she thought she could trust the robot to do the job properly
without damaging anything. I forged ahead saying, “If you can, then you don’t need
to watch it run. The human work has been separated from the machines work. Your
job is reduced to plugging in the base station, pressing the start button and walking
away.”

Her response was a somewhat cool, “Uh-huh …”

Sensing I was once again nearing the minefield, I quickly said, “How about you plug
the base station in the den, press the start button and I’ll take you out to dinner
while it works.”