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Newsletter Article:
“The older I get…” Mark Twain
Mark Twain said: "When I was a boy of fourteen, my father was so ignorant I could hardly stand to have the old man around. But when I got to be twenty-one, I was astonished at how much he had learned in seven years." In this the writer is able to distill something that we all experience in life. The passing of time makes us acutely aware of those in our lives, who in hindsight seem to have possessed wisdom far beyond our own.
Over the last year we have watched GM, Ford and Chrysler announce combined layoffs totaling in the hundreds of thousands. The trickle down effect shows up as millions of US jobs lost.
What’s the answer? Is there an answer? Could we, should we have seen this coming? Where do we go from here?
Let’s take a note from history.
Dr. W. Edwards Deming was a voice of wisdom and reason during the reformative years that followed World War II. And like Mark Twain was forced to recognize, we can now see in hindsight that as time goes by, the truthfulness of Dr. Deming’s words have become even more obvious.
He was, for lack of a kinder term “run out of town” by the US automakers as he warned of the exact result we see today. Dr. Deming subsequently found hearing ears in Japan. He was instrumental in the turnaround not only of Toyota, and Honda, but of Japan itself. He remains the only non Japanese person to be honored by receiving the “Second Order Medal of the Sacred Treasure” a presentation made by the Emperor of Japan himself. Dr. Deming has long since passed, but he leaves behind disciples, and I am proud to identify myself as such. For the past twenty years I have attempted to share in preaching about the implosion that we are now experiencing. Those of us educated by Dr. Deming could see it coming, and have had to watch it unfold before us like a slow motion train wreck.
I am not alone in experiencing the frustration of trying to sound the alarm while CEO’s, CFO’s and all the other O’s have ignored Dr. Deming, choosing instead to use short term thinking to drive their own US companies to near extinction. There are many (including my competitors) who have for years been preaching at the tops of our lungs.
Dr. Deming had to deal with this same frustration for decades before his passing. His disciples have inherited his frustration and his mission. But just because he was frustrated, he did not stop trying to remedy the problems of his day. And neither can we.
A doctor cannot give up on a seriously ill patient just because the patient may earlier have ignored advice against abusing drugs, cigarettes and alcohol. The doctor has an obligation to salvage the patient’s quality of life. He must continue to help turn around a bad situation if possible. Dr. Deming’s disciples have a similar obligation. I hope that I have taken my obligation seriously.
Recently I have watched other Lean Manufacturing disciples walk away from the operating theater. This economy has forced many of my brothers (my competitors) in this battle into more traditional manufacturing roles or into early retirement. Did they give up? Did the patient give up? Should I give up?
I have recently wrestled with where my obligation ends. I have authored four books on the subject of manufacturing, lean, six sigma and continuous improvement. I have trained tens of thousands. Is my work done?
I have watched the number of people attending tradeshow seminars and workshops dwindle. Attendee rosters seem to mirror and react to the cyclical nature of the recent stock market. Have we trained them all? I don’t think so. Are there more patients out there who want help? I have to hope and believe so. Dr. Deming didn’t stop, and I can’t either.
So continue I will, and hope that my competitors will do the same. There are just too many people who need help. I hope that instead of reaching the point of giving into the frustration we use this pivotal moment in time to regroup, rethink and restore the unique capabilities that we share. I hope that we can all take a larger lesson from Japan, not just that they adopted Lean Manufacturing, but that they pulled together to change their situation.
After World War II the Japanese people had every reason to feel like giving up. Their towns were in ruin, they were occupied by a foreign country, they had virtually no natural resources, they lacked any manufacturing capability, and they had no market for their products. It’s easy to see how they might have just given up, forfeited their future to the hopelessness and helplessness that shrouded their situation at that moment in time.
But Dr. Deming helped them, and they refused to die on the symbolic operating table. They made the necessary behavioral changes, they worked together, they educated each other, they shared best practices as they were discovered, they coached and trained the next generation, they challenged everything that they had ever done, they found improvements, and then challenged it all over again the next day.
Since beginning my consulting career I have worked with over 125 companies. We can conservatively measure the combined savings into the hundreds of millions. I don’t think it would be presumptuous to state that some of these companies are stronger, they are not just surviving, but are thriving because of the work that I have done. I guess that’s why I have to keep doing it.
I feel like the old country doctor who just can’t stop doing what he’s doing, because someday he knows that he will save a life.
Actual lives may not be at stake here, but livelihoods are. We have an obligation to each other to do the very best we can. I have an obligation to share with as many business minded individuals as will listen; lessons learned, case studies and best practices from the nearly 400 kaizen and continuous improvement projects that I’ve conducted since beginning my career. And you have the same obligation.
If you are a consultant keep working hard for your patients (clients). If you are a manager, get a check up (lean assessment). If you are on the finance team learn about Lean Accounting. If you are an in-house lean coordinator, continue your education. If you are a front line leader or manager, demand that your company provide your teams with education in the disciplines of Lean Thinking.
Download a free Lean Self Assessment.
Keep ~LEANING~ into it!
For more information about Dr. Deming’s work visit the website: http://deming.org
The manufacturing disciplines utilized by our dads and granddads are no longer a viable approach.
Einstein said it best: “The definition of insanity is to repeat the same process, and expect a different result.” Many organizations continue to practice (and educational institutions continue to teach) manufacturing principles that worked for our forefathers, ignoring the fact that the playing field has changed significantly. Some stubbornly remain unconvinced of the value of modifying past behaviors. Like typewriter salesmen during the introduction of personal computers they hold onto the past, claiming to take a wait and see attitude. We need to examine and challenge our approach for both long term economic and environmental reasons.
It is rare these days to come across companies who have totally ignored the message to become lean and green. Most companies have flirted with a technique or two (e.g.: recycling, scrap reduction, 5-S or Set-up reduction), some have even attempted a Lean/Green transformation. However due to the “firefight” of running and growing a business, frequently they struggled to sustain the gains, at time abandoning the change because the techniques applied at companies like Saturn or Toyota seem unreasonable within smaller “Job Shops” where they deal with “high-mix, low-volume” sales mix.
Mr. Shingo of the Toyota Motor Works described seven primary forms of waste. We have since discovered many more, permit me to talk about the seven he wrote and spoke about. All of which can have negative impact on both the bottom line, and on the environment.
1. Transportation waste
2. Waste of motion
3. Waiting
4. Over production
5. Defects
6. Excessive processing
7. Inventory
The greatest risk that I see is that companies take a “Shot-gun” approach to their transformation. They perform a 5-S event in one area, a set-up reduction in another; they experiment with a kanban replenishment system in a totally different area, and they attempt to improve the plant layout in yet another area. Five years later they are still fussing with it, and it’s time to go back and 5-S the first area again because they failed to sustain the improvements.
Our recommendation to our clients is to "totally transform" a percentage of the business. First identifying the value streams, then selecting one to transform into a “Model Line”. In doing so minimizing what has become known as “Kamakazi Kaizen” events. Some companies measure their continuous improvement process by how many Kaizen events they conduct. You cannot Kaizen your way to world class. There must be a structure, and you must be a good finisher. The number of events is less important than the quality of the outcome, or whether the outcome improved product or information flow.
By using the model line, you avoid developing a system that has no depth (like a brittle veneer), instead you are able to drill to the “bedrock” and firmly established the appropriate tools within the model line, quantify the benefits, justify future events, overcome resistance and quickly spread the “best practices and lessons learned” to other value streams.
There is a common theme among the most successful teams, they focus on how each idea or recommendation will impact the flow of value to the customer. Avoid starting in the middle of the process. Start closest to the customer. Rather than hurrying up just to wait longer, the parts are ready to sell earlier, and the improvement becomes visible to the customer.
A number of factors contribute to companies who struggle:
As the graphic (map) illustrates, there is a time tested route to World Class Performance. There are also many distractions, and detours along the way. These diversions can impede progress. The most successful companies have learned to identify pitfalls and avoid roadblocks along the Lean journey.
Key steps in transforming a company to the Lean approach.
One of the tipping points for our most successful clients is when they realize that they must find a common denominator (unit of work) to use in calculating takt times. Few of my clients have the luxury of making the same product day after day, so they must determine how many units of work are being demanded in order to accurately calculate how often they need to produce a work unit.
One example of this was at a company in Edmonton Alberta Canada. They manufactured oil pipeline equipment. One value stream made “well head casings and fittings”. Imagine a 12 inch diameter piece of pipe with a two inch flage on one end or the other (or both ends). Sometimes there would be a small flange out the side as well, perpendicular to the pipe. This particular team makes 7000 units per year on average. Given that there are 120,000 available minutes in a year, the Takt Time calculation seems easy:
120,000 divided by 7,000 = one unit every 17.14 minutes Except that not all the parts took the same effort or time to process. The two flange versions required 1.6 times as long to process. The three flange versions required 2.1 times as long as the single flange fittings. By performing the PQR (product, quantity, routing) analysis, we determined that they would sell around 2,000 units of the single flange variety, and 2,500 each of the two and three flange versions. Therefore we calculated their hybrid takt time this way: 2,000 * 1 = 2,000 2,500 * 1.6 = 4,000 2,500 * 2.1 = 5,250 Total = 11,250 120,000 available minutes divided by 11,250 work units = one unit of work every 10.66 minutes Now they had a meaningful takt time, and one they could update if the sales percentage ever changed.
Secondly, we have had to develop a hybrid value stream mapping system that recognizes the fact that not all products have the same operator cycle time. To establish “flow” job shops have to try to line balance work content that varies significantly from part to part. One piece flow is the ideal, but rarely possible in pure make-to-order environments. Determining the “weighted average” Operator Cycle Time, as well as the weighted average Machine Cycle Time and Set-up Time is a critical and often overlooked step in the traditional value stream mapping process. For example, if a process like machining is used for four different product types, each requiring a slightly different process time, then it is not simply the average of all the times. You must understand how the sales percentage of each can impacts the accuracy of true labor content. The goal must be to find an accurate weighted average “unit of work”. Example:
Product A = 50% of the sales volume. Product A requires 120 seconds to machine. Product B = 20% of the sales volume. Product B requires 150 seconds to machine. Product C = 5% of the sales volume. Product C requires 240 seconds to machine. Product D = 25% of the sales volume. Product D requires 300 seconds to machine
In this case, the weighted average operator cycle time for a “unit of work” is 177 seconds. If you simply calculated the average of 120, 150, 240, 300, the result would be around 202 seconds. So you would end up with too many parts in WIP on average, you would assign too many people to the job, and you’d possibly install too many machines as well. The same process is used to determine the MCT and Set-up times.
By appropriately balancing the line according to the weighted average Takt time, and Operator Cycle times you are better able to keep the flow, even in “make-to-order” shops.
It would be unrealistic to think that any program will work 100% of the time. We acknowledge that Pareto was correct in stating there is an 80%-20% rule in almost every activity. We are better off if our system is designed to run perfectly at least 80% of the time, recognizing that 20% of the time it might not run perfectly. But it’s better to get the benefits 80% of the time. The unacceptable alternative is to run with no improvement 100% of the time.
It is encouraging to see so many companies setting their sights high, moving their teams toward world class performance. There is also much work to be done. We can learn much from each other. Best kept secrets could be our downfall. We need to help each other along this path. The journey is not an easy one, but with the right guidance and direction we can see our economy grow and thrive rather than shrink and waste away.
I welcome your comments questions or concerns. Please visit our website for information about obtaining a full color downloadable and printable version of the “Road map to Lean” or to obtain a sample value stream map.
Lean and Green complement each other, companies like Walmart and others have recognized the financial benefit of adopting lean and green as a business model. Put more to the bottom line, while putting less in the landfill and leaving less of a carbon footprint.
Keep “Leaning into it!” |