This realisation has a profound change on the “how” of becoming world-class. It also has a profound impact on the roles and competencies of the “change agents” – those people that are specifically tasked to make the change happen.

So becoming world-class will have to start with developing organisational capabilities, the “enablers” of the change. What it does not mean is that results will have to wait – quite the contrary. Developing these capabilities will not be about attending 4 weeks of training and doing 6-month projects. It will be about learning every day about what works and what doesn’t – in terms of business practices as much as about people practices.  Argyris called this “double-loop learning“  – learning about the technical change and its impact but also about the behaviour change that is needed to make the technical change possible. This “double-loop learning” is really what makes continuous improvement possible.

You don’t become world class overnight, and you don’t become a learning organisation overnight. What you need is a clear roadmap to get you there, and for every stage of your development you will need to have made clear steps in developing the capability on the one hand, and business results to show for it in the other hand. This is the only way to keep on learning – you’re creating a “virtuous circle” of change and reward. The roadmap doesn’t give you the details, but sets the direction, so that all this learning does build up to a real “breakthrough” change. What the roadmap is going to look like will be different for each organisation. It will have to start with a clear, long-term vision of what it means to be world-class for your organisation. Then you can work your way backwards to determine what would be the stages you need to go through to get there, finally coming to the first tentative steps of real change.

Where approaches like Six Sigma are clearly lacking is precisely in the organisational learning and in the capability development of the entire organisation. Don’t get me wrong – as a Master Black Belt myself, I have seen the power of DMAIC and of the deployment of Black Belts. The problem is that by itself it is not sufficient; it is not truly transformational.

What this also means then for an entire generation of people trained as all kinds of Belts, with a strong emphasis on technical process improvement skills, is that they will need to learn to become facilitators of change, rather than just problem solvers. This is an entirely different set of skills, and I am sure that very few people actually have the capability to become both. What we probably need then is strong teams of change agents, with a good mix of leadership, faciliation, and problem solving skills.

Now we need to create the dialogue about the process and its performance. Dialogue means: having a two-way conversation about WHAT is happening and WHY it is happening.  This is not just going to happen by itself. Time needs to be allocated to do it – maybe 5 to 10 minutes each day.  It also needs to be relevant, structured and constructive. Given the right metrics and the right visuals (the visual management board), the relevance part should not be too difficult. The structured part will initially need a good facilitator – after a while participants could take turns facilitating. Finally it needs to be constructive. This is probably going to be the hardest part.

In many organisations, a relevant and constructive dialogue with the people who are doing the work has never taken place. So there are a number of barriers that need to be overcome. First of all, there will be a good deal of scepticism – “why do we need to talk about this?” “why should I care?” “I have never been asked anything before, why do I need to say something now” “nothing is going to change anyway”. There could also be a good deal of stage fright – “I am not good at talking in public” “I don’t have anything relevant to say”.

It is going to be important to demonstrate that this dialogue indeed does lead to something. Initially this can be about resolving small irritants that may not have such a big impact on performance but that are just annoying – “the letter A on my keyboard gets stuck” “we don’t have any decent gloves” “the lighting is too low here”. Being able to talk and resolve these are going to be a very important test!

Once the initial barriers are overcome and the first victories can be celebrated, the real work can begin: continuous improvement.

Since I have been doing some writing on implementing Visual Management Systems, I thought it was interesting to do a map for that.

Should “lighten up” this blog a bit and hopefully will be useful for you!

Visual Management System Implementation

Actually I would argue it can be deployed pretty much independently from other Lean solutions. Ultimately it is a critical component of a Lean culture, but if it is just improving flow you are after there maybe no need for a full-blown VMS. Maybe you will just want to implement some visual “takt boards” – to keep track of hourly production, for example.

I am saying “full-blown”, because there is much more to it than just a couple of boards on the walls. As a colleague of mine used to say, “six sigma tools are hard to understand but easy to apply – lean tools are easy to understand but hard to apply”. It all looks so deceptively simple. You go and visit a “benchmark” Lean site, and they have all these boards, and they stand around them for 10 minutes a day, how difficult can this be? And to some extent, it isn’t. You buy these boards, decide what goes on them, decide who updates them, you put this daily meeting format together, and presto!

And in a number of cases, just doing that has a tremendous impact. I have worked in a number of lab environments that were very much like “black boxes” – things went in but you never knew when stuff was going to come out. With boards that show the status of all samples – in the queue, being prepared, in testing, in reporting, … - it shows you immediately what was going on, what was blocked for some reason, and even if we needed to put in more capacity to meet deadlines. In a completely different environment in financial services, daily deadlines for processing transactions were missed over 20% of the time, mainly because there was a complete lack of transparency over progress through most of the day. That also meant actions could only be undertaken when it was already too late. After putting up boards that showed the volumes coming in, completed and in progress on an hourly basis, the manager and the entire team could track progress and decided whether action was needed well before the deadlines. WITHIN A WEEK missed deadlines dropped to below 5%!!!

These are cases where it is just a matter of creating transparency and visibility over the work. I have written about the importance of this before. However this aspect does not yet make it a Visual Management SYSTEM. What is missing? Well, two things really: 1) it needs alignment and integration with the overall management processes, and 2) it needs some additional tools and activities to make it part of a continuous improvement system.

The key here is to look at the journey a product order or service request takes through your processes. Start from a customer request or order and find out what happens before it is filled. You will often be astonished by the long and meanderous path it takes. Do measure the time it takes to deliver the product or service. Also measure how much of that time is spent in actually doing something useful for the customer. Very often this is only a couple of percentage points – all the rest is waste! Waiting time is likely to be one of the most important “time wasters”. This in turn is due to “work in progress” (WIP) building up between steps.

There are a number of reasons why there is a buildup of WIP and therefore of waiting queues. An obvious one is that capacity may not matched to demand, or that it does not respond quickly enough (or not at all) to changes in demand. Look at what happens in a McDonald’s when a queue of customers is building up at the counters. Usually they will respond quite quickly by opening an additional counter. 

In other cases the effects of “batching” appear: in an attempt to be “efficient”, types of product or service requests are lumped in batches that have to wait for other batches to be completed. So your request may be the next in line but it will be delayed because it is going to be lumped with similar requests. The net result is that almost everyone will have to wait longer. Do not assume that this only happens in production environments. Mail boxes (electronic or physical) may only be emptied at certain times in the day. Approval signatures are only given once a day or once a week.   Work is only assigned in the morning – too bad if your request came in at 5 past 10.

Once you understand where work queues build up and why, you are ready for the next step: Lean solutions.

The first thing to do is to establish what it is exactly that your business does for your customers. What is the value you create for your customers? What are the key activities that are creating this value? This is by no means a trivial exercise!

Once you have done this, the next steps should be easy. Everything that does not add value for the customer, is waste. So now you need to  identify all the stuff you do, classify it into value adding or non-value adding (waste), and then measure how much time you spend on each. 

In order to measure the waste, you need to go one step deeper: you need to establish what tasks – things that people do that you can observe – belong to what key activities. You also need to establish what other tasks people are doing – so those that are not part of these key activities – which will, again, automatically constitute waste.

A good way to make this inventory of tasks is to quite simply to ask people to make a list of the things they do. You will get a lot of lists and then you will need to get people together and agree on what tasks belong to what activities. Finally, you agree with them what are the value added activities. This consensus is quite important in order to avoid arguments during or after the assessment. It is highly likely that you are already going to be quite surprised about all the stuff people are doing that you never realised they were doing – and in may cases you won’t know why!

You are now almost ready to conduct your waste measurement. How exactly you are going to do this depends somewhat on the type of tasks. When these are easily observable, manual and repetitive, you can observe these yourself and use a stopwatch and a poll sheet to record your measurements. Obviously you are going to need to explain to everyone first what it is you are going to be doing, what it is for, and also what it is not going to be used for. The message should be clear that it is about assessing activities and waste, not about assessing people.

In a lot of office processes this kind of observation is much more difficult. Here you can use a measurement sheet to have the people measure their own activities. Over a couple of days, you ask people to record how they have spent their time every two hours. This is not going to be a precise measurement, but it will give a rough idea. Two hours appear to be a good interval because people often have breaks every two hours or so, so that is a great time to reflect on what they’ve done. Make sure people do not record their measurements only once a day, you lose a level of detail but of precision as well.

After the measurements you will have two types of results. First, you will know how much time you spend on each key activity. Secondly, you will know how much waste there is within each activity, and how much there is outside of the key activities.

Next… ask yourself why you are doing all this non-value adding stuff and how can you reduce it? In a lot of cases, it will be things like counting, correcting, moving around, moving stuff from one place to another… not forgetting all the meetings you waste a lot of time in. The answer may lie in simple solutions like moving printers, moving desks, reducing the number or the length of meetings, etc. Many may have less obvious reasons and solutions, for which you may organise a problem solving or kaizen event.

This is obviously a “quick and dirty” way to look at waste. Lean purists will tell you it actually does not identify all types of waste – in particular, it does not look at “flow” and the lack if it. But before going deeper into concepts like Value Streams, Work In Progress (WIP) and the like, it should in most cases already give you enough of a shock to realise that ”something must be done”! Which is a good starting point for doing Lean!

Since a Lean implementation is by no means a trivial effort, the questions “Why Lean? Is it worth the effort in our environment?”  are worth reflecting on, the more so since, indeed, the benefits may not be obvious in your specific case. Furthermore, anyone that is familiar with the principles of change management knows that you need a good reason for change – call it a “burning platform” (not if you work in the oil industry of course), a “vision”, or something else, but there must be some incentive.

So the first thing you need to ask yourself is: why do you need to change at all? Maybe you are doing fine as you are, you don’t have things that keep you awake at night, and the future looks rosy. In that case, don’t read on!

But if you do have a compelling reason for change, and this can be in the form of problems as much as opportunities, and in the present as much as it can be in the future, then the next question is – “Will Lean be of help to solve my problem / grab the opportunity?”. Again a question worth asking because clearly Lean is not the answer to everything.

First of all, and most importantly, there must be some “time” component in your problem / opportunity – either from a “customer value” point of view or a “business value” point of view. Lean really is at its best if there is a strong need to be more responsive, deliver more quickly, or spend your (or the customer’s) time better. Most Lean solutions are geared towards problems of this kind.

Secondly, there must be some identifiable and repeatable process(es) involved, that is converting some “inputs” into “outputs” through some identifiable “activities”. So if your problem is that you cannot think of a new strategy in time for the next board meeting, tough luck (unless your new strategy would be Lean itself, of course!). This requirement, by the way, is also valid for a Six Sigma approach. A colleague of mine has tried to convince me otherwise but I don’t believe you should be tackling your absenteism problem by using a DMAIC approach, however valuable the stats may be to give you a better insight in the problem.

Thirdly, you are facing some variation in your process. If customer demand is perfectly stable or fully predictable, your product or service is always exactly the same, and your processes perform always as planned, you can stop worrying. You don’t have a problem, or it should be in the near future – China is likely to move into your space. Six Sigma may help you in reducing variation, but Lean teaches you how to deal with it.

But if you have answered “yes” to all three questions - please go to my next blog entry, that should tell you in what way Lean may help you to tackle your problem / opportunity.

The challenges already started when doing the Value Stream Maps. What where the essential metrics that we wanted to appear in the “data boxes”? The obvious ones where lead times and cycle times, of course. But it already took a bit of discussion to come to a good definition of “cycle time” when applied to a manual operation. Traditionally, in manufacturing, the cycle time is the time needed to produce one piece. Here we were not producing anything, of course, so we decided that it would mean “the time needed to complete one full cycle of an action, from the start till ready for the next cycle”.  This proved to be a universally applicable definition, usable for all kinds of activities, from loading and unloading activities over sorting and moving to office transactions.

What we initially lacked but were really interested in was some measure of waste or efficiency. It turned out that with our definition of cycle time, it was quite easy to work out an “Operating Level” – a well-known metric for practitioners of OEE (Overall Equipment Effectiveness) in manufacturing, although it is sometimes called something different, like “Run Rate”. For a machine it is the ratio of the actual output (number of pieces per time period) over the maximum output (designed machine speed) over that same time period. For us it now meant the ratio of the actual number of cycles completed over the maximum possible number of cycles in that time period. For example, we observed that it took about 5 seconds on average to take a parcel from a transport belt, scan its barcode, put it in a cage for transport, and be ready for the next parcel. We then observed how many such cycles were completed in a 10-minute period. Let’s say that this number would be 60, then the Operating Level works out to 50% = 60 / 120 = 60 / (600 s / 5 s). This allowed us to identify opportunities for improvement quite quickly, and it constitutes an interesting benchmark figure for use across processes and sites.

This Operating Level became our most important efficiency metric. In a number of cases, it lead to shocking figures, like 15% in some sorting processes!

Starting from this metric it was also relatively easy to determine the OEE – which is Availability Level x Operating Level x Quality Level. The availability level is the percent of time the process is actually running during the normal working hours. In manufacturing this is mainly determined by the losses caused by changeovers and breakdowns (short stops / “minor stoppages” are counted in the operating level losses). Here it would mean all kinds of interruptions that were not a normal process event. Finally the Quality Level is the ratio of cycles that are completed successfully / without failure.

The Operating Level was not something that was measured before, but interestingly, the Availability Level was measured for certain types of equipment like automatic sorters. This lead to improvement objectives such as “improve the availability during peak hours from 93 to 96 %”… while the Operating Level was actually below 50%!!! Why would you try to gain a measly 3% when half of it is going to be thrown away immediately anyway and you may be able to get 20% or more output by organising the work a bit more efficiently???  This was a great “myth buster”, because they also thought this sorter was their bottleneck… Well it is if you only use it to less than 50% of its capacity…

The point is that very often I will not be able to solve the problem for them – especially if it is a change problem (which it usually is, even if disguised as a technical problem). What I will try to do is guide them through a change process that ultimately should help them solve their problem for themselves. But to do this in a way that solves the root cause (typically something that is deeply engrained in the culture) usually requires a pretty long time, often more than they are willing to spend. Plus, they seem to think that they are really paying me to solve the problem for them, even if I never promised them that and deliberately avoided even suggesting it.

This is particularly true if it is a “buzzword” assignment – which a lot of consulting assignments are. A “Lean” assignment is a classic one. That one word can mean a million different things, depending on what articles or books have been read about it. In order to avoid misunderstandings about what our role is and how we are going to fulfill it, we spell it out in quite some detail during the contracting and planning phases. Unfortunately most people do not really understand what we are saying, blinded as they are by their misconceptions of what the role of the consultant is.

Lean, and other “Excellence” concepts for that matter, relies to a great extent on the maturity of the organisation for the sustainability of its solutions. I have helped develop and implement many Lean solutions, only to found out they fell in disrepair after a couple of months. If there is no ownership of performance with the teams, then there will be no discipline (no matter how many work instructions they have nor how many audits they do) and it will not be sustainable.  

Lean needs a solid and healthy dose of performance focus on the one hand and participative management on the other hand. Already the behaviours and attitudes of management will determine these properties to a large extent. Ultimately, management needs to understand it is THEIR problem and theirs alone to solve.  Deming and Juran already said this a long time ago, of course…

It already started at the Disney hotel. We were asked to show up for breakfast at a particular time, and given a ticket for that. By itself a good “lean” idea – it is a good example of “load levelling’ where you try to spread demand evenly over time. However, you still need to make sure you have enough capacity to meet that demand – otherwise you will get a domino effect and queues will grow longer and longer. This is precisely what happened. On the first morning, we showed about about five minutes before the scheduled time, but we had to wait in a queue for a good 20 minutes.  The capacity of the restaurant itself did not seem to be the problem, there were a good number of tables free when we were seated. The problem rather seemed to be with the personnel assigned to showing people their table, there were only 2 people doing this which was clearly creating a bottleneck. It is hard to understand why nobody reacted, because the long queue was a clear sign that something was wrong.

The next day it was even a lot worse. This time the queue was at least twice as long. We really did not want to queue for 45 minutes, so we decided to go and have breakfast in the Village, even if this meant paying again.

Unfortunately we had a similar scenario at the Blue Lagoon restaurant where we decided to have lunch. Here you also have to book a table in advance, but we had eaten there 2 years earlier and it was fine then. We arrived well ahead of the booked time and waited in the room arranged for that purpose. Then we were told we could go in, even a couple of minutes before our booked time.  We knew our table was free, otherwise they would not have called us. However, at the entrance of the restaurant, there was a queue of four parties ahead of us! It became apparent very quickly that, once again, there was not have enough personnel to show people to their table.  I asked the hostess for an explanation and she said that this was a decision of their new supervisor a couple of days earlier. Bad decision – but again, the problems were easily visible (the queue!!!) and should not have been hard to resolve.  Clearly this supervisor had not understood how the system was supposed to work.

A third incident that weekend was at one of the shows. Again, the system of queueing is well designed and usually works very well. There is a room in front of the show entrance that can hold exactly the amount of people that can attend the show. Five minutes before the start of the show, these large doors are opened so people can get in quickly and get a seat. There is a queue in front of this room with a turnstile and a counter that shows how many seats are left for the next show. This saves you waiting in the queue when there are clearly not enough seats left for the next show (at least gauging the queue gives you some idea if you can still make the next show). But obviously it takes a while for an entire room of  people to get through the turnstiles. During the day, that process starts just after the doors for the previous show have been closed, and for most shows it seems to take about 15 minutes before the room is full and the turnstiles are closed, and this is plenty of time before the next show starts.

Unfortunately we were queueing for the first show of the day, and the guy operating the turnstiles clearly had not understood the system. He only started to let people through the turnstiles about 10 minutes before the start of the show, and this left only 5 minutes for people to move through the stiles into the waiting room – not enough to let 200 people through, not by a long shot. So the turnstiles were closed again, as planned, 5 minutes before the start of the first show – when the counter still showed over a 100 seats to be available! You can imagine the anger of people (including me) that had showed up more than half an hour before the start of te first show to be sure to get in – or so we thought.

Our ordeal was not over yet. When queueing for the “studio backlot tour”, which uses a train with 5 wagons or so, the entire queue was held up because personnel had to prepare the first wagon for people in wheelchairs. They clearly were not used to doing this, so it took a hell of a long time, and for some reason that I could not fathom they would not let anyone board any of the other wagons while they were doing this. 

I was really surprised at all this, because Disney has a reputation for training people thoroughly. Clearly it had not been done properly this time.