September 30, 2015 Industry Forum Blog Are you in a position where you need to improve your information or people based processes? This may be to meet new company objectives or because they are currently causing you problems. I most often find companies want to: Improve the cash flow cycle – get paid more quickly. Reduce the time it takes to do the task, like turn round quotes. Improve customer ratings on standards of service. Meet deadlines. My recommended approach is to; map the current process, identify the problems and opportunities for improvement and deploy the right lean tool in the right place. Do not be tempted by a blanket deployment of 5S, huddle boards and Standardised Work across a whole department. It rarely produces measurable results and nearly always alienates the workforce. The approach State what it is you want to improve. Which task in which department? State your target and the link to company objectives. Form a team involving people from the area. Having people who know what actually happens is vital as these tasks are much harder to observe than manufacturing ones. Think of the task as a process with inputs and outputs. Decide what the “material” you are processing is. It could be numerical data, documents or a person. This helps us in step 4. When compiling a month end financial report we followed the flow of data into the final document. When booking in cars for service we followed the interaction with the car owner and then the route of the vehicle. Physically capture the current process as it actually Use a suitable mapping tool. Go to where the work is carried out. Observe, ask questions. Don’t fall into the trap of using an existing procedure or one person’s opinion. Enhance the map with supporting data and key measures. Spot wastes, threats and opportunities for improvement in the process. Get the team to stand around the map, brainstorm, and attach sticky notes where they occur. I always use the standard 7 Waste tool, with non-manufacturing examples given for each waste. In particular I get teams to look for order corruption, back flows and disconnects. You can be pedantic and classify these as one of the 7 Wastes, but it helps teams to identify them when they are highlighted in this way. Make sure to pay attention to the interfaces between departments, customers and suppliers as well. At this point it also works well to identify opportunities for improvement. This helps to move the team into the next step. Create a future state. Draw what you want the process to look like – especially if you used one of the mapping tools. With a simple process flow it may be enough to just eliminate the identified wastes and not draw a future state. Identify the most appropriate lean tools. Deploy them in a way to achieve the future state and eliminate the wastes you spotted. Avoid these problems. As with any improvement activity follow up and close out actions for sustainability. Make sure you communicate what is happening to everyone and train the wider team in the new and improved processes. Calculate savings and benefits. Keep looking for ways to improve. Future blogs will highlight ways of applying the right lean tool in the right place. If you want to share your examples please send them in.
September 23, 2015 Industry Forum Blog Setting up a system to improve your New Product Introduction (NPI) process has been identified as one of the six basic success factors to improve your ability to get new products to market quicker and cheaper. What is a lesson learned? The identification of project activities that went well and not so well Subsequent analysis resulting in recommendations for improvements Implementation of recommendations to realise benefits Lessons should be sought, captured and acted upon throughout the life of the project. When do we capture lessons learned? Ideally from the beginning to the end of the project. Some organisations find it useful to set formal points as well. Typically these occur when stage end reports for gate reviews are compiled and at the close of the project. What are the benefits? These are examples of times when organisations have used their lessons log and what they have used them for. When setting up the project board – who to include When selecting the project manager – which skills are desirable When outlining the business case – how to phrase it When setting up the risk management strategy. What threats and opportunities affected previous projects to help identify risks and appropriate risk responses Setting up cross-functional teams – mix of people When creating stage plans – suitable timescales Also have a look at the role lessons learned played in the building and staging of the 2012 Olympics. Who is responsible? The project sponsor and the project manager create a new lessons learned log during the project start up phase. They also review existing logs and implement relevant actions in the new plans. Once underway, it is up to everybody involved in the project team, even stakeholders, to seek out lessons learned. The project manager is responsible for ensuring these are captured acted upon. They can delegate completion of tasks but not responsibility for ensuring they are done. The role of Lessons Learned in the 2012 Olympic games The Olympic Delivery Authority (ODA) for London 2012 delivered this huge public project on time and on budget with a 5 year lead time. Key objectives included: The greenest games ever Utilisation of the venues after the games to ensure certain return on investment Not only did Lord Coe and the project teams review lessons learned from previous Olympic games but part of the legacy of London 2012 was to formally share lessons learned during construction and staging. Lord Coe attended the 2010 Winter Olympics in Vancouver to see how the city coped with hosting such a large event and experienced first hand how they recovered from unforeseen challenges such as the warm weather at Cypress Mountain. The ODA set its own green and cost effectiveness guidelines and planned how venues would be utilised after the games. Nobody wanted a repeat of the moth balled swimming pool from Beijing 2008! London 2012 is sharing the knowledge and the lessons learned through the Learning Legacy project. Although we don’t need them to plan another UK based Olympics in the near future, they can be applied to other construction, transport and sustainable event based projects. In addition many of the individual lessons can be applied to an even wider project base. If you can think of at least one improvement to the way your New Product Introduction(NPI) system runs, add it to your Lessons Learned. And if you don’t have such a system, consider setting one up.
September 16, 2015 Industry Forum Blog Does your Training Needs Analysis result in an affordable and robust organisation wide training plan? Does it prioritise learning and development to meet both current and future requirements? If not don’t worry. This blog introduces a model developed at Industry Forum that will help you work through this daunting task. The Training Needs Analysis Cycle In this model TNAs are undertaken at three levels; organisational, departmental and individual. The responsible person at each level inputs key information into the process. This information is designed to answer four important questions: Why do people need the training? What skills need to be taught? Who needs the training? What are the priority areas for training? The three levels are interlinked to ensure that a balanced analysis is produced. This takes into account the company’s strategic plans, the departmental objectives and each individual’s needs. The outcome of the cycle is a robust, organisation wide learning and development plan that has an approved budget. The benefit If you deliver the resulting training plans you will ensure you have sufficient capability within the organisation to sustain current and future business performance. Deployment tips Initially this model was developed to help organisations deploying the Training and Education Pillar of Total Productive Maintenance. However, with minor adaptation it works in any organisation. The work done at organisational level in a TPM company is done by the T&E pillar team. Alternatively use a team of senior representatives responsible for training in the organisation. One of the important inputs at departmental level is losses; specifically those losses that are the result of inadequate skills. Don’t be put off by terminology, quantify the problems you encounter because of inadequate skills. This input allows you to prioritise which skills require improving. We recommend developing your framework and testing it in a pilot area. Once running smoothly, roll it out to the rest of the organisation. The full TNA cycle needs to be conducted on an annual basis, to align with your policy deployment cycle. Ideally you would do this before any training solutions are budgeted, designed or delivered. Departmental level and individual level reviews typically happen at a frequency of 6 or 3 months. If you want to find out more about how to deploy the Training Needs Analysis Cycle please contact us.
September 11, 2015 Industry Forum Blog One of the four stability pillars, T&E is often lost amongst the wealth of more technical information on equipment care and maintenance. But ignore T&E at your peril. It is initially deployed in the TPM journey alongside Focussed Improvement, Autonomous Maintenance and Planned Maintenance in order to improve production efficiency. However, ongoing deployment is a key part in achieving the goal of zero accidents, zero defects and zero breakdowns across the whole organisation. How? This pillar focuses on eliminating the losses caused by inadequate skills. Ongoing deployment of a 6 step methodology produces an organisation wide picture of these losses allowing them to be fully understood, prioritised and actioned. Which skills? Every individual within the organisation needs to be fully trained in their job role. It’s not just the practical skills of equipment operators that are vital in eliminating loss across the company. The managerial, technical and administrative skills for all roles must be raised. What do we get from deploying the pillar? In a nutshell the outcomes of deploying the pillar include systems that will: Continually monitor the training required to meet the long term vision of the company. Set the methodology and standards for a range of training processes. Create effective training plans to maximise the potential of every employee. How do theses outcomes benefit us? They ensure that in a world where technology, materials and competitors are changing at an increasing rate, training for the right skills is continually identified and provided. They allow the company to plan for long term goals such as the calibre of individual employees required at certain times. A thorough Training Needs Analysis results in a company succession plan, individual career plans and personalised training programmes. The resulting training opportunities make employees feel valued and ensure the succession plan is fulfilled internally. Employee turnover is reduced as well as the need for recruitment. They reduce the true costs associated with training. Whilst the first column represents what we typically see as the costs of training in the accounts, the second column shows the true amount. It includes the cost of the losses that occur due to inadequate skills. When the company invests in training programmes that improve peoples’ skills and in turn efficiency in the workplace, the total training cost falls as both losses and recruitment costs reduce. As an added bonus a well structured and documented training process will easily provide the proof required for organisations to comply with various standards and audits such as VDA 6.3 and ISOTS16949. How do I start deployment of T&E? I recommend following the six steps of the T&E pillar used by JIPM. The steps provide a logical approach to getting the most out of your training and education activities. You can find out more about T&E by watching our short video clip or by attending training programmes such as the Industry Forum 2 day T&E course. In my experience the part that most companies struggle with is conducting a company wide Training Needs Analysis as part of step 2. In the next blog I will introduce our Training Needs Analysis Cycle which helps companies conduct this vital groundwork. If you have any further questions about T&E please contact us.
September 7, 2015 Industry Forum Blog All too often I hear about cases where the deployment of lean techniques has failed and lean is rejected by the people it was meant to help. I’m particularly disappointed when these occur in work environments that process information or deal with people, like offices, health care, transport and other service providers. So if you are new to lean, or a lean convert from a manufacturing background, and are keen to give it a go in your office, here are my top 4 pitfalls to avoid. Blitzing people’s personal items instead of improving the information flow Carrying out a 5S activity is done to eliminate waste and support the process in an improved state. It should not be done to “improve housekeeping” and make the place look tidy. In the office environment the process centres on the flow of information (or people). So is diving in and removing personal photos and snacks from desks supporting an improved work flow? Or will it just antagonise people? I have found that a 5S activity that supports improved flow and makes peoples work easier is more successful. Often the activity focus is in shared work areas, both physical and electronic. Using lots and lots of yellow tape Again, I’ve seen 5S deployed in an office where every waste paper bin and pot plant ended up surrounded by squares of yellow tape. Result – unimpressed manager! Two points here: Yellow tape should only be used as a temporary measure until the right position for an essential item is agreed upon. Then a smarter, more subtle and permanent method for indicating the home location can be used. Is marking the position of the pot plant helping to support an improved work flow? Don’t go mad with the tape! Failing to involve the people who work in the area Using a team approach that includes people from the work area is standard best practice. They have the working knowledge and skills required to contribute to the best improvements. More importantly doing lean to people, instead of involving them, causes alienation and rejection. If you don’t believe me try the Wallet Exercise! Not using data to focus and show improvement Teams need to fully understand how an area works before they make any physical changes. This helps them to select the right improvement tool and apply it where it counts – see points 1 and 2. Information and people based processes are not exempt from this. In fact as the processes are often harder to see than manufacturing ones, it’s even more important to do this. To start, collect and analyse key data, map the process and understand the targets or objectives for that function. Later comparison to original data will show how the improvement is going. It is vital to demonstrate that the effort you put in does affect the bottom line. There are of course more than these 4 things that can foil your activity. But my advice is to give it a go and learn by doing. Always review what you have done and keep learning points for next time you apply the technique. True understanding of lean comes with application. I will write some follow up blogs giving examples of how lean techniques can be successfully applied to information based environments. If you want to share your examples and learning points then please send them in.
August 27, 2015 Industry Forum Blog It is a common misconception that Mistake Proofing includes any device that simply reduces the possibility of errors. To help us understand the difference in the principles concerned I am going to use two holiday snaps from my favourite steam railway. The first is one of the most unusual signs I think you will find at any level crossing. Using a standard warning triangle with an imaginative diagram of a crashing cyclist and two languages, it is designed to warn riders that the up coming rails are hazardous. The second, using colour and symbols, shows the safe route to be taken to avoid becoming stuck in the rails on the crossing. Do they prevent cyclists risking personal injury and damaged equipment? Surprisingly no! Despite ongoing additions to the warnings, some cyclists either don’t understand or choose to not follow the visual instructions. This situation is not unique to the railway. In fact any situation where a process can be performed incorrectly is open to improvement. Manufacturing, medical care and information based processes can all benefit from understanding and implementing Visual Management and Mistake Proofing techniques. Visual Management Is the application of visual signs, prompts or indicators in order to: Prevent abnormalities occurring by promoting the correct action at the right time Indicate immediately if an abnormality does occur Monitor performance i.e. what has happened, what is happening and what is going to happen Good visual management needs no interpretation and immediately provokes the correct reaction The best visual management systems use features such as lights, symbols and standard colour coding. These features, along with optimal positioning, reduce the amount of time it takes a person to correctly interpret what is meant. All of these good features are present in the railway crossing example, so why doesn’t it work all the time? To understand we need to look at the principles behind Mistake Proofing. Mistake Proofing The ultimate goal of Mistake Proofing is to eliminate the wastes associated with errors. Time, money and resources are wasted wherever errors are allowed to occur and result in defects. (See Shingo’s work). In our rail crossing example the cyclist has made a process error. He has not followed the procedure indicated by the visual signs and markings. The resulting defect is the bike trapped in the rails. The rider wastes their own time and money getting free and making repairs as well as passenger time if they delay the train. Errors must be discovered and eliminated before the opportunity for them to become defects occurs. This is done using a Mistake Proofing device. These either: Prevent an error being made Detect when an error has occurred as early as possible and feedback into the system to prevent further errors, or correct the error before it becomes a defect A comparison of the two Visual Management, often used with 5S and Standardised Work, minimises interpretation, helps ensure consistency and eases completion of a process. Although Mistake Proofing draws heavily on the techniques of Visual Management, it actually eliminates interpretation and the reliance on familiarity. This eliminates the risk of error. So the ultimate solution is to design your process, or product, to eliminate the sources of error. What next at the level crossing? A prevention device to eliminate the gap between rail and tarmac can be bought. Ultimately the cost of any Mistake Proofing device must be weighed against the cost of the defects. Think about what processes you need to improve and whether you need Visual Management or Mistake Proofing.
August 19, 2015 Industry Forum Blog One of the top tips to help you to select the best CMMS system for your business is to establish why you need a maintenance system and what you want from it. The idea is to be prepared before you go and talk to potential providers. To help get you started this blog lists some of the outputs you may want to consider. It then looks at the inputs required to get them. To simplify this I have broken down the workings of a CMMS into a diagram using the process model as a framework. On the right are the outputs or functions of the system, the things you want it to give you. On the left are the inputs the system requires to give you those outputs. The box at the top of the diagram represents the method by which the system operates; this is determined by the rules and analysis functions the software provider builds in. At the bottom we can see an “improvement loop”. Certain outputs of the CMMS need to be fed back in to the input side as parameters change. Lessons learned and updates to schedules as a result of Planned Maintenance improving the equipment, are just two examples. Outputs and functions The 11 outputs and functions shown in the diagram are really category titles. Each one of these comprises a number of detailed items. A more thorough list can be found here. While some of the outputs are really just retrieval of existing documents the clever part of the CMMS generates schedules for maintenance activities, conducts analysis on all the information collected and produces reports and forecasts to support decision making. It’s important to decide what functions you want for your business before you investigate what is on the market. Answer the question “Why do we need it?” Use the detailed list to start a discussion with your team, but be selective. Don’t be dazzled by the amazing functionality described by the provider if it’s really not what you need. Remember data and information that isn’t used is just expensive wallpaper. Inputs CMMSs draw on a variety of data held in different databases. These are shown as the inputs on the right hand side of the diagram. An expanded list of these 7 categories can be found here. Ideally the system you chose should integrate with the existing software and process control systems already used in your plant e.g. planning, asset management, parts inventory, parts location, purchasing, costing and escalation rules etc. When you go shopping for your CMMS have a list of what systems you need it to integrate with. The future Over time you will need to expand your CMMS and make improvements to it as you review its ongoing use. Before you buy make sure the supplier can demonstrate that the system can be developed. If you have any specific questions or suggestions about the list let me know.
August 12, 2015 Industry Forum Blog We know that deploying lean tools improves our performance indicators. We see employee engagement rise when improvement activities are successful. But how do you convince the managers who hold the purse strings of the financial benefits? The answer lies in talking to them in their language – money and more specifically profit. Improvement initiatives can help your business to make more profit in two ways; by: Making more product without additional cost Making the same amount of product for less cost So work out the monetary benefits of your activities and communicate them. Both of the following examples are from actual MasterClass events (identifying information removed). Additional product made – calculate the marginal contribution The marginal contribution is the additional sales value minus the material, labour and overhead costs of producing additional quantities. There are three steps involved in the calculation: Develop a Profit and Loss (or contribution) account based on the current state of the area you are working in. Include reference to the measures that will be used to monitor the progress of the improvement. Use the previous twelve months’ activity. If data is only available for a shorter period it should be extrapolated to produce an annualised figure. This gives a fair comparison. Recreate the account using the improved measures to show a forecast profit or contribution for the next twelve months. Compare the bottom line figures calculated in the two columns. Marginal contribution example Application of the Line Balance technique resulted in improved People Productivity and reduced Not Right First Time. The additional output is sold and the cost of scrap is reduced. Measure Before Improvement After Improvement Not Right First Time 28,476 ppm 25,234 ppm People Productivity 268 ppoh 277 ppoh Benefit Calculation Before Improvement After Improvement Sales volume A 32,000,000 35,200,000 Sales price/unit B £0.16 £0.16 Total sales C C = B X A £5,120,000 £5,632,000 Direct material cost/unit D £0.0386 £0.0386 Total direct material costs E E = D X A £1,235,200 £1,358,720 Scrap cost/unit F £0.0098 £0.00814 Total scrap cost G G = F X A £313,600 £286,528 Contribution H H = C – (E + G) £3,571,200 £3,986,752 Additional contribution I I = H after – H before £415,552 The increase in sales volume, material used and the reduction in scrap will show in those lines of the Profit and Loss account. The additional contribution calculated in the table, is the overall increase that will show in the profit line of the Profit and Loss account. Reduction in a cost item – calculate the total impact Cost savings may result from the reduction in the amount of labour required, the amount of scrap generated, the amount of consumables, materials or power used, the loss of material, fluids, oils, coolants or compressed air used, special freight charges or late delivery penalties. Again calculate the saving over a fixed period of a year. The figures you need are usually found in accounts. Total impact example The Set Up Improvement technique was deployed resulting in reduced set up time. This allowed an additional number of set ups to be done, resulting in reduced batch sizes, less work in progress and finished goods being held. The financial benefits are calculated as follows: Before Improvement After Improvement Stock A From stock check £375,077 £201,121 Stock cost % B Between 10 & 50% organisation dependent 30% 30% Stock holding costs C C = A x B £112,523 £60,336 Savings D L = C before – C improved £52,187 Cash generated E E = A before – A improved £173,956 Interest % F 10% Interest saved G G = E x F £17,396 Total annual savings H H = D + G £69,583 The reduction in stock holding cost is seen in various line items in the Profit and Loss account depending on what costs are incurred in your business. The reduction in stock and increase in cash generated will show as changes on the Balance Sheet. The total annual saving is seen as increased profit in the Profit and Loss account. Using the financial benefit If the activity results in making more for less and reducing cost items you can add both the calculated benefits together. Remember though, when you communicate the benefits you need to include the cost of the improvement activity! Finally, you mat want to make sure somebody revisits your costing system to translate the savings made into a reduced price for the customer. If you have found other ways to show the impact on your bottom line, share it with us.
July 30, 2015 Industry Forum Blog Big data is all the rage, but are we using our “local” data to our best advantage? Let’s call “local data” the raw data you generate in your work place; like your KPI results, breakdown and maintenance print outs and various quality logs. What do you do with it? If you use it correctly you can maximise your business performance. You need to: Turn the data into useable information Act on that information to improve your performance Turn the data into useable information Data analysis is the conversion of raw data e.g. print outs, KPI numbers etc. into easily understood information that can then be used to drive action. Most forms of data analysis result in a chart, graph or data trail being produced, Try this exercise to understand why we convert raw data to a chart. How quickly can you identify; the highest, the lowest and the repeated number from the following list? Time yourself. Now try the same test with the following data. How quickly can you identify; the highest, the lowest and the repeated number? Check both your answers at the bottom of the post I bet you were quickest interpreting the chart? And if you got an answer wrong it was on the list test? Why is that? The chart is easier and quicker to interpret accurately. This is because the data in the chart is arranged in ascending order and colour has been used to highlight the area of interest. But what is it really doing for us? If we add other relevant information to the chart we start to turn the data into useable information. In this standard grid format we have added: Titles to the top and the axes for context. A target line to place the level of performance. A data source box to aid validation and future comparative analysis. And at the bottom of the grid: A comment – which sums up what the chart is telling us An action – which brings us to the 2nd thing we must do with our data Act on that information to improve your performance The action tells us what needs to be done next. This may be an immediate response to ensure daily performance targets are achieved, or it may be more data collection, further analysis or a focussed improvement action. It is vital that each piece of data analysis done drives an action. If no action is taken all you have done is create expensive wallpaper! Tip: Display the information and actions on clear visual display boards. Locate these as close as possible to the relevant workplace. Use them as a central point for communication meetings and briefings between managers, team leaders and teams. Their use raises awareness and helps involve everybody in working towards a common goal. It focuses action by using facts instead of allowing “who shouts loudest” to win. Have a look at the data you have in your workplace. Is it turned into useful information? Do you act on that information to make improvements? If you don’t, challenge yourself to make your data count. Answer A lowest 12, highest 47, repeated 25. Answer B lowest 13, highest 45, repeated 29.
July 22, 2015 Industry Forum Blog We all know it’s vital to get senior management engagement if we want our improvement programmes to be successful. We also want our managers to lead them with the right attitude to change. Here are two quick exercises you can use to help you influence the approach management teams take to improvement initiatives. They require minimal equipment and advance preparation and so you can use them exactly where and when you need them. The Cane Game Objective The team must lower the cane to the ground keeping it perfectly level at all times! Instructions Break into teams of at least 8 people Line up opposite each other Each team member holds out the forefingers of each hand When the fingers are level, but not touching, the facilitator lays a garden cane on top of the fingers The facilitator starts the exercise by saying ‘go’, and makes sure that the team keeps the cane perfectly level They must stop and level up before moving further down to the floor I have never found a team yet who can keep the cane level all the way to the ground on their first attempt! Now capture their comments on how they found the game. Learning points Working as a team is hard Change is hard Sometimes an obvious request goes frustratingly slowly Tip: You don’t have to have a garden cane, any straight pole will do, like a brush handle. If you travel a lot then buy a folding tent pole; usually under £10 from camping shops. The Wallet Exercise Objective The team will be asked to conduct an improvement activity on other members’ possessions. Instructions Ask everyone in the room to stand up and place their wallet or purse on the table or floor in front of them. (Don’t panic if people opt out. Put yours in to encourage a few takers) Have everyone move one place to their left (or right, it doesn’t matter) Tell everyone to pick-up the wallet/purse in front of them and when the facilitator says go, they have to dump it all out and reorganise Get rid of everything they don’t think is needed and put items back where they think they work best At this point, everyone in the room will get a bit upset… this is good. Don’t actually go ahead with having anyone reorganise another person’s wallet, but capture peoples reactions on a flipchart Learning points The emotion you feel at the thought of having someone else pry into your possessions is what employees feel if outside teams come into their work place and start to make changes without them being involved or consulted How did the people who did not hand over their wallets feel compared to those who did? They might be feeling safe, and possibly a little smug! How would you deal with these people in the workplace if they were refusing to join in with your improvement activity? Have a look at The tale of the team and the newt to see what could happen depending on the choice you made. Tip: This exercise is useful for heading off situations where prior communication and consultation has been sub-optimal and you haven’t got time to introduce the Change Management principles in full. Have you tried these exercises before? Did you get the results you were looking for or do you have a different “game” that works?
