Wednesday, April 29, 2009

Stability is the Foundation

I want to start this blog with a quote from Art Smalley. He is one of the 'Lean' experts that I greatly respect for his focus on execution. He writes on lean as if he were a company owner rather than a professor discussing theories or a consultant trying to sell something. It is from an article on Superfactory titled: Creating Basic Stability (find the article at www.superfactory.com).

Toyota has been reluctant to publish or even endorse what they consider to be the right way to implement lean. Their reluctance is well taken given our inherent human tendency to look for an easy way out or cut and paste answers from elsewhere. Toyota executives have always maintained that TPS/lean is a system of thinking and that practitioner’s can best “learn by doing.”

When pressed, however, veterans of Toyota comment that certain pre-conditions are needed for a lean implementation to proceed smoothly. These include relatively few problems in equipment uptime, available materials with few defects, and strong supervision at the production line level. And these are precisely the problems that I see manufacturers still struggling with today.

He goes on to discuss how Basic Stability should be considered the first step in a Lean transformation or even a precursor to attempting to become Lean. What gain can be had from jumping straight to Kanban sizing when poor quality raw materials are driving increased inventory? How can you create flow when machines continually break down? How long will improved performance as a result of Kaizen and standard work last when first line supervision isn't creating disciplined people and disciplined processes to maintain the gains?

This starts to get to the heart of this blog. It's putting the cart before the horse by jumping straight to the 'sexy' tools of Lean rather than understanding that a foundation for success needs to be in place. That foundation is not necessarily unique to Lean either. Not every great company is Lean and not every (or even all that many...) Lean companies are great. So why are some more successful than others?

Wednesday, April 15, 2009

Principles for Process Management

A well run organization always has well defined and executed processes. If you look in the Toyota Production System (the basis of today's Lean) Basic Handbook they give to employees, the foundation their entire system is built on is Stability. The focus of Six Sigma is to reduce variation and increase process control. Great literature from Sun Tzu's The Art of War through to Henry Ford and on to Jack Welch focus on discipline and the need for stability. Quint Studer looks towards 'disciplined people and disciplined processes' in Hospitals and in his research on companies that moved from Good to Great, Jim Collins found that they all had a culture of discipline.

This quest for discipline and stability creates consistent process that customers can count on. It reduces waste and the costs of poor quality. It reduces the need for supervision and inspection. It is also the basis of improvement. How can you improve a process that is not completed the same every time? Even if you were to make a change, would that change continue to benefit if you can't count on it being performed consistently?

Three Principles for Process Management:
1. Solve Problems
2. Create Robust Management Systems
3.
Continuously Improve


How do you bring about stability and discipline? Start with relentlessly raising and solving problems. Leave no stone unturned and ignore no problem however small. Ask Why five times for every problem you find and be sure to follow through. Once problems are starting to be solved it is easier to create consistent and robust management systems for all processes. These systems are the lifeblood of a successful company, not a paper exercise for auditors. With a culture of problem solving in place and robust systems in operation, then a company can focus on reducing waste and continuously improving every day. Use the best and brightest you have to drive change and then incorporate that change into your robust systems so you can be sure of the benefit.