Improvement Facilitation & Coaching: An
Open Forum Webinar October 29, 2013

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3 Q1: Any key tips
on facilitating "out of the box" thinking? Often times participants brainstorm solutions that can be a little too basic.

© 2013 The Karen Martin
Group, Inc. 4 Facilitating “Out of the Box” Thinking • Executive sponsor – Clear expectations – Permission to be bold • Use of a proper charter (and properly socialized)—or A3 – Clear problem – Measurable targets • Safe environment • Permission to be bold • Skill set (yours and theirs) • The New Business of Paradigms video – http://www.youtube.com/watch? v=ujv_B1PGx8Q – www.crmlearning.com

© 2013 The Karen Martin
Group, Inc. 5 1 2 1 3 2 4 3 5 4 5 1 6 2 7 3 8 4 9 5 10 1 2 1 3 2 4 3 5 4 1 2 3 4 Date: Date: Freed capacity to absorb additional business w/o increasing staff. Signature: Date: Benefits to Business Agreement Better working relationships between sales, estimating & engineering. Executive Sponsor Higher margins. Signature: Signature: Higher confidence in Golden State's products and staff. Production Supervisor Faster delivery. Function Less hassle (back and forth re: RFQ, design and code). Planning / Purchasing, Planner Continential breakfast & lunch Surf's Up - Room A Tom St. James Benefits to Customers On-Call Support JR Hunt Improve quality of information flowing throughout value stream. Customer (contract manufacturer) Reduce PO to SW dev completion by a minimum of 50%. Customer Service, Manager Ambreen Motiwala Danny Tran Michael O'Shea Reduce RFQ lead time by a minimum of 50%. Manufacturing, Director Scrum Master Goals & Measurable Target Conditions Engineering, Vice President Unclear & incorrect information flowing through value stream. IT, Director Lead time for RFQ turnaround = 2 weeks; PO to SW dev = 5 weeks Finance, Controller Desire to stay ahead of the competition & deepen customer loyalty. Function / Title Forecasted growth of 15% for next fiscal year. Sales, Director Current State Problems & Business Needs Mapping Team Boundaries & Limitations Improvement Time Frame No new software; only minor changes to existing IT systems; no additional staff; no budget changes Future state design is fully realized by December 31, 2013. Last Step Production ships product Logistics Coordinator Dave Parks July 24, 25, & 26 4:00-5:00 pm First Step Sales reviews the RFQ Briefing Dates & Times Meals Provided Briefing Attendees ** required *optional ** Joe M (CIO), Sal T (VP Sales) * Bruce R (VP Ops), Carlos P (HR), Su T (CFO), Bill M (VP CS) Demand Rate Trigger 1,000 per year Customer submits RFQ Value Stream Mapping Charter Scope Accountable Parties Logistics Allen Ward Nancy Little Specific Conditions Engineer to order, requires both hardware & software Value Stream Champion Capital equipment Executive Sponsor Value Stream Event Dates & Times July 24-26, 2013 Dave Parks Base-camp Location Facilitator Name Name Lourdes Dwyer Diana Marie Dave Gerald Ryan Austin Facilitator Value Stream Champion Sean Michaels Contact Information Contact Information

6 Q2: How would you
talk a site manager into using a Strategy Deployment X-Matrix or Hoshin Kanri plan to prioritize improvements? I am two levels down in his chain of command, and my boss is all for it.

Task #1: Focus Reduces Chaos
Task #2: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 7 © 2013 The Karen Martin Group, Inc. – www.ksmartin.com Round 1 – Alternate between tasks : letter, number, letter, number, etc. Round 2 – Complete one task before beginning the next. Sentence: Numbers: Sentence: Numbers: The Cost of Switch Tasking – Timed Activity

You need an improvement strategy
that’s aligned with overarching business goals 8

Hoshin Kanri X-Matrix
9

10 1. Increase sales 5%.
3. Achieve 10% profit. Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec IT Mktg Ops HR Bob Fin PE Pario COM Direct CDs / AMs PD Rec PD Mgmt BMD SWS 2 3,500 units sold by 12/31/2013 through all channels (approx. $700K) X X X X X X X X X X X X Bob Dana 2 3 3 3 2 3 3 1 1 3 3 1 3 11 Develop & deliver training to top 50 Dealers X X X X X X Bob Rex/Tim 3 3 3 21 Revised course materials by 6/30/2013 X X X Bob Josh R? 2 3 3 2 2 5 Education: 1 school district spec'd/underperforming COM distributor (25) by 12/31 valued at min $35K each X X X X X X X X X X X X Howard Michael S 1 3 2 3 3 8 10 new dealers on board (net) ($500K per dealer this year) X X X X X X X X X X X X Howard Mike B 2 3 9 5 new distributors bringing $200K annual rev (& 5 terminated) X X X X X X X X X X X X Howard Howard 1 1 1 2 3 17 10 projects spec'd by 12/31; $300K rev by 12/31 X X X X X X X X X X Howard Dana 1 3 3 3 29 20 by year-end X X X X X X X X X X X X Howard Mark H 2 3 3 3 32 TBD X X X Howard Howard 33 TBD X X X X X X X X X Howard Howard 10 Useful reporting and metrics are established and in place X X Jim Randall 3 1 1 1 1 1 1 30 TBD X X X X X Jim Josh 3 31 TBD X X X X X X Jim Josh 1 1 1 3 1 1 1 1 1 1 1 1 1 1 25 TBD Jim Shannon 3 3 1 1 1 1 1 26 System 7.0's in place X X X Jim Randall 3 2 1 2 1 15 100% accurate payroll; 100% management satisfaction at April mgmt. meeting X X X Josh Phyllis 1 3 20 Internet task list is simplified and streamlined for PDs then plan is rolled out to PDs X X X X Michael M Michael M 2 3 2 3 22 Design Calculator is updated successfully and rolled out X X X Neall Matt D 3 1 1 3 2 2 3 24 Competitive Analysis complete and distributed for use X X X Neall Dana 2 3 3 3 3 3 3 1 Design changed to solve delam issue long-term X X X X X Susan David R 3 2 3 12 30 parts sourced in U.S.; completed plan for managing China-sourced parts X X X X X X Susan Shannon 3 3 2 2 13 Warehouse laid out; kanban revised; Syspro implemented X X X Susan Shannon 3 14 Lay out complete; equipment installed X X X Susan David R 3 3 X = Planned 2013 Priorities 2013 Goals & Objectives 4. Improve morale (metric TBD). 2. Achieve 50% gross margin. Created: 01-14-13 Revised: Level of Effort/Involvement Required Priority Goal or Measurable Objective Exec Owner Plan review dates: Tactical Owner ● = Actual < Company Name > Content removed for confidentiality © 2013 The Karen Martin Group, Inc. Tie Improvement to Annual Strategy Deployment Plan ABC Company

Strategy Deployment Key Feature: Catchball
11 Executive Team What? How? Who? When? Senior Mgmt What? How? Who? When? Middle Mgmt What? How? Who? When? Frontlines What? How? Who? When?

© 2013 The Karen Martin
Group, Inc. 12 Selling Strategy Deployment • Education: David Meyer’s research re: engineers • Demonstration of the cost of switch tasking (next slide) • The Outstanding Organization – Chapter 3 (Focus) • Getting the Right Things Done – Pascal Dennis • Why isn’t your boss selling it?????

Strategy Deployment Books Modified strategy
deployment Chapter 3 - Focus

14 Q3: Our corporate, division
& plant management teams only think of quarterly results and want to implement lean. Management team expects higher efficiency should result in reduced head count. How can I engage employees in such an environment and change thinking from short term to long-term benefits?

15 Q4: How do you
usually select a product family?

© 2013 The Karen Martin
Group, Inc. 16 Selecting Product Families for Improvement 1. What are the business goals? – Strategy deployment helps – What problem are you trying to solve or opportunity do you need to leverage? 2. Where do you have supportive leadership? 3. What’s an “easy” one to tackle first?

© 2013 Karen Martin &
Mike Osterling 17 Function Function Function Function Core Value Stream Support Value Stream Support Value Stream Traditional vs. Value Stream Thinking © 2013 The Karen Martin Group, Inc. Value stream segment Value stream segment

Value Stream Scoping Diagram Defining
Specific Conditions Golden State Equipment, Inc. Capital Equipment Catalog Configure to order Engineer to order Custom hardware Custom software Both New Product Development Spares & subassemblies Catalog Engineer to order 18

Refining the Scope: Hiring Process
Hiring Requisition Existing Position Salaried Employee Hourly Employee Office Field Contractor New Position Salaried Employee Hourly Employee Office Field Contractor 19

20 Q5: Have you found
an effective, scalable method for introducing the PDCA (e.g., kata) methodology into a multi-facility enterprise? How should we introduce PDCA when people have been using trial/error all their lives and in some cases getting good results?

© 2013 The Karen Martin
Group, Inc. 21 Developing PDSA (PDCA) Skills • Develop execs first (using A3). • If that’s not possible, develop managers first. – Try this: - Use A3 initially, then move to kata. • All managers must be highly proficient in Lean philosophy, PDSA/PDCA, analysis tools, countermeasures, and coaching!

22 From The Outstanding Organization,
p. 115 Attaining Mastery © 2013 The Karen Martin Group, Inc.

23 Q6: How can we
best get non- employed physicians to engage in our Lean improvement efforts?

© 2013 The Karen Martin
Group, Inc. 24 How to Engage Non-employed Physicians • Establish organization-wide priorities via strategy deployment. • Pay them.

25 Q7: How do you
keep your teams small and yet ensure buy-in from large communities of people involved in the process?

© 2013 The Karen Martin
Group, Inc. 26 1 2 1 3 2 4 3 5 4 5 1 6 2 7 3 8 4 9 5 10 1 2 1 3 2 4 3 5 4 1 2 3 4 Date: Date: Freed capacity to absorb additional business w/o increasing staff. Signature: Date: Benefits to Business Agreement Better working relationships between sales, estimating & engineering. Executive Sponsor Higher margins. Signature: Signature: Higher confidence in Golden State's products and staff. Production Supervisor Faster delivery. Function Less hassle (back and forth re: RFQ, design and code). Planning / Purchasing, Planner Continential breakfast & lunch Surf's Up - Room A Tom St. James Benefits to Customers On-Call Support JR Hunt Improve quality of information flowing throughout value stream. Customer (contract manufacturer) Reduce PO to SW dev completion by a minimum of 50%. Customer Service, Manager Ambreen Motiwala Danny Tran Michael O'Shea Reduce RFQ lead time by a minimum of 50%. Manufacturing, Director Scrum Master Goals & Measurable Target Conditions Engineering, Vice President Unclear & incorrect information flowing through value stream. IT, Director Lead time for RFQ turnaround = 2 weeks; PO to SW dev = 5 weeks Finance, Controller Desire to stay ahead of the competition & deepen customer loyalty. Function / Title Forecasted growth of 15% for next fiscal year. Sales, Director Current State Problems & Business Needs Mapping Team Boundaries & Limitations Improvement Time Frame No new software; only minor changes to existing IT systems; no additional staff; no budget changes Future state design is fully realized by December 31, 2013. Last Step Production ships product Logistics Coordinator Dave Parks July 24, 25, & 26 4:00-5:00 pm First Step Sales reviews the RFQ Briefing Dates & Times Meals Provided Briefing Attendees ** required *optional ** Joe M (CIO), Sal T (VP Sales) * Bruce R (VP Ops), Carlos P (HR), Su T (CFO), Bill M (VP CS) Demand Rate Trigger 1,000 per year Customer submits RFQ Value Stream Mapping Charter Scope Accountable Parties Logistics Allen Ward Nancy Little Specific Conditions Engineer to order, requires both hardware & software Value Stream Champion Capital equipment Executive Sponsor Value Stream Event Dates & Times July 24-26, 2013 Dave Parks Base-camp Location Facilitator Name Name Lourdes Dwyer Diana Marie Dave Gerald Ryan Austin Facilitator Value Stream Champion Sean Michaels Contact Information Contact Information

27 Q8: What are some
tools to keep Coaches/Facilitators engaged after they had their training? How do you get teams to focus on data when they are more concerned with their own routine?

28 Q9: PDCA vs. DMAIC?
PDCA = Plan, Do, Check, Act DMAIC = Define, Measure, Analyze, Improve, Control

© 2013 Karen Martin &
Mike Osterling 29 Value Stream Mapping Strategy Deployment (Hoshin Kanri) or A3 Projects, Kaizen Events, Kata

30 Q10: How can I
best coach / facilitate a senior leadership group that is unwilling to see things in ways other than their own? Are there specific 'go to' questions that could be considered 'never fail'? Sometimes it's difficult to assess if a question is too edgy and might cost me my job. Any guidelines?

© 2013 The Karen Martin
Group, Inc. 31 31 Who? Accountability Tool Leadership “What has to happen” Value Stream Mapping Workforce “How it will happen” Kaizen Events, Just-do-its, and Projects Improvement Roles Strategic Tactical Middle Management

© 2013 The Karen Martin
Group, Inc. 32 Helping Shift “My Way” Thinking • Lean leadership behavior development – Gemba orientation – Humility – Curiosity – Scientific thinking/doing (PDSA/PDCA) – Authorizing the people who do the work • Education / observation / simulation / data • “How’s that workin’ for ya?”

33 Q11: Recommended books that
are worth my time? A17: Visit www.ksmartin.com/reading-list

34 Q12: Problem with blending
Value Stream Mapping and Kaizen Events (on the same week).

© 2013 The Karen Martin
Group, Inc. 35 35 Who? Accountability Tool Leadership “What has to happen” Value Stream Mapping Workforce “How it will happen” Kaizen Events, Just-do-its, and Projects Improvement Roles Strategic Tactical Middle Management

© 2013 Karen Martin &
Mike Osterling 36 Value Stream Mapping Strategy Deployment (Hoshin Kanri) or A3 Projects, Kaizen Events, Kata

© 2013 Karen Martin &
Mike Osterling 37 1 2 3 4 5 6 7 8 9 10 11 12 2 Improve quality of referral to 85% KE Sean Michaels 100% 3,4 Reduce lead time between scheduling and preregistration step to 45 minutes Proj Dianne Marie 75% 4 Only one check in per patient KE Ryan Austin 50% 4 Reduce wait time in waiting area by 50% KE Dianne Marie 50% 6 Eliminate 6 hour lead time associated with transcription step Proj Dave Gerald 50% 7 Eliminate redundant data entry Proj Dave Gerald 25% 5 Visually managed inventory; no outages or expired items KE Michael O'Shea 100% 6 Reduce imaging LT to one hour Proj Martha Allen 25% 8 Reduce report delivery LT to 30 minutes Proj Martha Allen 0% 7 Reduce LT at image review to 1 day JDI Dave Gerald 100% Value Stream Transformation Plan Value Stream Value Stream Champion Value Stream Mapping Facilitator Allen Ward 1-Nov-12 Executive Sponsor Scheduled Review Dates 21-Nov-12 Outpatient Imaging Paul Scanner Dave Parks 13-Dec-12 10/18/2012 10-Jan-13 Date Created Value Stream Mapping Facilitator Increase % of physicians receiving electronic delivery Planned Timeline for Execution Status Signature: Agreement Signature: Signature: FS VSM Block # Measurable Target Proposed Countermeasure Implement standard work for referral process Exec. Method* Owner * Execution Method = JDI (Just-do-it), KE (Kaizen Event), or Proj (Project) Cross-train and co-locate work teams Value-stream specific radiologists Implement voice recognition technology Auto populate between PACS and Meditech 5S CT supplies area; implement kanban Collect copays in Imaging Balance work / level demand Visual metrics and indicators Date: Date: Executive Sponsor Value Stream Champion Date:

38 Q13: In the organization
where I work we had a lot of Kaizen events. We had a lot of cost saving but today we are not able to do additional Kaizen. How can we start again? What are the activities we have to do to avoid a fatal end to lean implementation?

39 Q14: How do you
get teams to focus on data when they are more concerned with their own routine? CLARIFICATION: I run into a lot of people that collect data for their areas as a daily routine but do nothing with the data. How do you get someone to go from being a bean counter to analyzing data and make improvements from that data?

40 Q15: What have you
done when you have a group of Kaizen participants who are trained, but do not "believe" in Continuous Improvement?

41 Q16: What are some
tools to keep Coaches/Facilitators engaged after they had their training?

42 Q17: How do you
ensure you get the right team leader?

43 Q18: How can continuous
improvement teams be engaged through the use of appropriate improvement tools?

© 2013 The Karen Martin
Group, Inc. 44 Karen Martin, President 7770 Regents Road #635 San Diego, CA 92122 858.677.6799 ksm@ksmartin.com For Further Questions Blog & newsletter: www.ksmartin.com/subscribe