Driving Improvements at Canada Post Ensuring Lean Six Sigma Efforts align with Business Objectives
Agenda <ul><li>About Canada Post </li></ul><ul><li>Organization for CI </li></ul><ul><li>Business objectives </li></ul><ul...
About Canada Post <ul><li>Became a Crown Corporation in 1981 </li></ul><ul><li>Employ almost 72,000 people </li></ul><ul><...
About Canada Post <ul><li>Our brand is the most trusted of all Canadian Federal Institutions </li></ul><ul><li>Rated as on...
About Canada Post <ul><li>Over 14,000,000 points of call </li></ul><ul><li>Increasing by 240,000 per year </li></ul><ul><l...
About Canada Post <ul><li>4 different Unions or Associations </li></ul><ul><li>5 different Collective Bargaining Agreement...
About Canada Post 2003 2001 1999 1997 1995 Introduction Of Lean Process  Management & Visual Depot Plant Equipment Alignme...
Regional E&CI Director GM E&CI “ Regional Lead and National Champion” IE’s Continuous Improvement and Projects Lines of Bu...
Lines of Business Operations Requirements Lean Sigma Center <ul><li>Process Specifications </li></ul><ul><li>(Process Mana...
2009 Performance Scorecard Value Stream Specialist Expenses:  50  <ul><li>Deliver $500K ( approx 13,500 equivalent worked ...
The VSS improvements will be directly attributable to your bottom line.  This is not a separate cost savings target from y...
Tony Kloosterman Manon Grise Alison Hillis, VSS Transaction Mail Steve Withers Project 1 : BCS Improvement $1 M per year P...
<ul><li>“The true value of standard work is to serve as a basis for experimentation.  Standards are set - as bases of comp...
Business Objectives
Business Objectives <ul><li>Business Objective </li></ul><ul><li>Reduce accidents </li></ul><ul><li>Improve Service </li><...
About Canada Post <ul><li>Who is our customer? </li></ul><ul><li>What processes add value? </li></ul>
<ul><li>P.F.M    Current State VSM    Future State Map </li></ul><ul><li>48 hours! </li></ul>Example Project
Example Project
Example Project <ul><li>Do NOT brainstorm a future state! </li></ul><ul><li>8 Questions </li></ul><ul><ul><ul><li>Takt tim...
Example Project <ul><li>Objective  decision making </li></ul>
Example Project
Example Project
Example Project
Example Project 10% improvement Makes waste more visible
Example Project Did the change improve as much as we hypothesized? If so: ~22,000 hours work or $814,000
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  • Before 1981 we were a part of the Government of Canada Plants range from 300 to 2000 employees
  • Background and introduction
  • Profitability based on point of call density. Largest delivery area of all postal organizations. Travel more than 77 million km / year (48 million miles) Equivalent of flying to the moon and back twice a week!
  • Lay ground work as to WHY we have the business objectives that we do. Military history – command and control management, powerful unions If we don’t find ways to not rehire these people, we will be stuck with them for the next 20 years.
  • Evolution of Lean 6 sigma done many times In our first 3 years we freed three million square feet of processing space - $ directly to the bottom line 2008 the Black Belt program saved $12m, only 40% of projects were aimed at cost savings 2009 target is $21.5m 35 VSS, 47 Black Belts, 146 Green Belts
  • Need to have the process/value stream specified for each LOB product Must check that it is being done according to the spec, ourselves or via the VSS (local process owner) Processes must be standardized, stable, predictable, Capable, capacity, quality, cost – process yeild Continuously improving
  • Gap analysis Best practices
  • In addition to lean tools to remove cost and improve lead times, the VSS are trained on tools to improve safety and ergonomics. Their green belt training provides them with data analysis expertise to look at data and display it in ways that lead to better process understanding. They are given stakeholder and change management training that help them to successfully make change happen. Good lean projects improve all the above scorecard items if the tools are properly used.
  • Tony : Regular meetings and walking the floor with the VSS to help them with direction, and in making progress. Keeping them part of the plant team, but out of meetings and on the floor as much as possible. Signing off the project results on the A3 reports. Attending project reviews and certification boards. Discouraging on-the-fly process change without VSS involvement. Manon : Balancing the VSS workload, keeping them focused and out of meetings, sharing within the regions. Prioritizing within the region. Signing off project results on A3 reports. Attending project reviews and certification boards. Steve : Provides coaching on using the lean sigma tools, application to CPC, sharing across regions, making sure their education progresses. Conducts certification of black and green belts. Bob (Bryan) : Helping the VSS work through gap analysis and specifications to standardize across operations as much as possible.
  • Takt = 76 seconds Several accidents in 2008 when people were getting off their chair and walking to racks
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    1. 1. Driving Improvements at Canada Post Ensuring Lean Six Sigma Efforts align with Business Objectives
    2. 2. Agenda <ul><li>About Canada Post </li></ul><ul><li>Organization for CI </li></ul><ul><li>Business objectives </li></ul><ul><li>Example project </li></ul><ul><li>Question and Answer </li></ul>
    3. 3. About Canada Post <ul><li>Became a Crown Corporation in 1981 </li></ul><ul><li>Employ almost 72,000 people </li></ul><ul><li>Support an additional 45,200 jobs </li></ul><ul><li>Approximately 70% of our cost is in labour </li></ul>
    4. 4. About Canada Post <ul><li>Our brand is the most trusted of all Canadian Federal Institutions </li></ul><ul><li>Rated as one of Canada’s top 100 employers </li></ul>
    5. 5. About Canada Post <ul><li>Over 14,000,000 points of call </li></ul><ul><li>Increasing by 240,000 per year </li></ul><ul><li>Largest area of all Postal Organizations </li></ul><ul><li>Profitable for 14 years consecutively </li></ul>
    6. 6. About Canada Post <ul><li>4 different Unions or Associations </li></ul><ul><li>5 different Collective Bargaining Agreements </li></ul><ul><li>No lay-off clause </li></ul><ul><li>33% of work force to retire in the next 4 years. </li></ul>
    7. 7. About Canada Post 2003 2001 1999 1997 1995 Introduction Of Lean Process Management & Visual Depot Plant Equipment Alignment Introduction Of Six Sigma 2005 2007 2009 1993 Use of JIT Principles VSS Organization Deployed Visual Depot & ROI Process Council
    8. 8. Regional E&CI Director GM E&CI “ Regional Lead and National Champion” IE’s Continuous Improvement and Projects Lines of Business Parcels Transaction Mail Direct Mail Requirements Lean Sigma Center RE&T IE Skills & Process Changes Operations Goals Cost Quality & Service Employee Requirements “ Local Process Owners” Organization for CI – Roles in E&CI Plant Director Shift Manager 1 2 3 VSS Parcels VSS Transaction Mail VSS Direct Mail Supervisors and staff Parcels Transaction Mail Direct Mail Induct Sort Transport Deliver Specifications Improvements (A3) End to End Design Cycle of CI
    9. 9. Lines of Business Operations Requirements Lean Sigma Center <ul><li>Process Specifications </li></ul><ul><li>(Process Management System) </li></ul><ul><ul><li>Process requirements </li></ul></ul><ul><ul><li>Outcome metrics </li></ul></ul><ul><ul><li>Process metrics </li></ul></ul><ul><ul><li>Process map </li></ul></ul><ul><ul><li>Hand-offs </li></ul></ul><ul><ul><li>Gap analysis checklist </li></ul></ul><ul><ul><li>Audit plan </li></ul></ul><ul><ul><li>Assess best practices </li></ul></ul>Process Engineer Process Owner (strategy & management) <ul><li>Conduct Gap analysis </li></ul><ul><li>Implement Process Specs </li></ul><ul><li>Understand performance trends & opportunities </li></ul><ul><li>Continuous improvement </li></ul><ul><li>Coach/guide standard work & pace on floor (e.g play-book, RTO) </li></ul><ul><li>Control Process Changes </li></ul>Improvements (A3) Parcels Transaction Mail Direct Mail National PE Directors <ul><li>Product changes </li></ul><ul><li>National projects </li></ul>“ Minimum Standard Baseline” 2009 Scorecard: $500K per VSS Replication A3 s Organization for CI – Process Management VSS Cust Induct Sort Transport Deliver Cust CI Engineers (IE) + Cycle of CI Project Engineers (IE)
    10. 10. 2009 Performance Scorecard Value Stream Specialist Expenses: 50 <ul><li>Deliver $500K ( approx 13,500 equivalent worked hours) in value stream improvement savings documented through A3 project/ initiative reports (50) </li></ul><ul><li>Achieve plant cut-off times for assigned value streams (15 ) </li></ul><ul><li>Service results to own value stream: (10) </li></ul>Service and Delivery Quality: 25 Employee Engagement: 15 <ul><li>Employee Involvement </li></ul><ul><li>(i) Employee involvement in every continuous improvement project & standard work update ( 5) (ii) Visible and active leadership ( 5 ) (iii) YOY improvement in EE survey score in assigned plant ( 5 ) </li></ul>Health and Safety Culture: 10 <ul><li>Number of accidents - plant results ( 5 ) </li></ul><ul><li>Number of accidents – direct value stream actions ( 5 ) </li></ul>
    11. 11. The VSS improvements will be directly attributable to your bottom line. This is not a separate cost savings target from yours . Organization for CI – VSS Scorecard Expenses: 20% Operations Director Scorecard Health & Safety: 30% Service & Delivery Quality: 25% Employee Engagement: 25% Contributed by VSS Value Stream Specialist Scorecard Expenses ($500K) 60% Health & Safety: 10% Service & Delivery Quality: 15% Employee Engagement: 15% (50%) (25)
    12. 12. Tony Kloosterman Manon Grise Alison Hillis, VSS Transaction Mail Steve Withers Project 1 : BCS Improvement $1 M per year Project 2 : O/S Breakdown Improvement $198K per year plus 61% reduction in lead time VSS success depends on excellent support from several directions: Bob Watson (Bryan Epp) Lean Sigma Center Process Owner E&CI Director Operations Director <ul><li>Coaching </li></ul><ul><li>Training </li></ul><ul><li>Tools </li></ul><ul><li>Process </li></ul><ul><li>PO Specs </li></ul><ul><li>Measurement </li></ul><ul><li>Best Practices </li></ul><ul><li>ID Opportunities </li></ul><ul><li>Evaluate A3s </li></ul><ul><li>Help prioritize </li></ul><ul><li>Mentoring </li></ul><ul><li>Validate analysis </li></ul><ul><li>Team alignment </li></ul><ul><li>Coaching </li></ul><ul><li>Mentoring </li></ul><ul><li>Eliminate barriers </li></ul><ul><li>IE Support </li></ul>A3 Engaged Front Line Team <ul><li>“ Local Process Owner” </li></ul><ul><li>Improvement specialist </li></ul><ul><li>Lean Black Belt </li></ul>Dialogue <ul><li>Role clarity </li></ul><ul><li>Prioritizing </li></ul>Organization for CI – Doing it right!
    13. 13. <ul><li>“The true value of standard work is to serve as a basis for experimentation.  Standards are set - as bases of comparison - and are used as baselines for improvement.  As long as current standards are as they are, there should be no deviation.  However, if someone has a better idea for how to perform his or her own work, that idea is proposed, approved (via VSS - my words), tried, evaluated against the current standard and rewarded.” </li></ul>John Shook, Managing To Learn Organization for CI – Why Standardize?
    14. 14. Business Objectives
    15. 15. Business Objectives <ul><li>Business Objective </li></ul><ul><li>Reduce accidents </li></ul><ul><li>Improve Service </li></ul><ul><li>Lower cost </li></ul>Activities Lean Six Sigma leads to business results Remove hazardous or wasteful activities Reduce lead time Reduce lead time and wasteful activities
    16. 16. About Canada Post <ul><li>Who is our customer? </li></ul><ul><li>What processes add value? </li></ul>
    17. 17. <ul><li>P.F.M  Current State VSM  Future State Map </li></ul><ul><li>48 hours! </li></ul>Example Project
    18. 18. Example Project
    19. 19. Example Project <ul><li>Do NOT brainstorm a future state! </li></ul><ul><li>8 Questions </li></ul><ul><ul><ul><li>Takt time? </li></ul></ul></ul><ul><ul><ul><li>Finished good supermarket or direct? </li></ul></ul></ul><ul><ul><ul><li>Where can we flow? </li></ul></ul></ul><ul><ul><ul><li>Where is pull needed? </li></ul></ul></ul><ul><ul><ul><li>Where is the pacemaker? </li></ul></ul></ul><ul><ul><ul><li>Production mix at the pacemaker? </li></ul></ul></ul><ul><ul><ul><li>Production volume at the pacemaker? </li></ul></ul></ul><ul><ul><ul><li>What other improvement are needed? </li></ul></ul></ul>
    20. 20. Example Project <ul><li>Objective decision making </li></ul>
    21. 21. Example Project
    22. 22. Example Project
    23. 23. Example Project
    24. 24. Example Project 10% improvement Makes waste more visible
    25. 25. Example Project Did the change improve as much as we hypothesized? If so: ~22,000 hours work or $814,000
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