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Lean Office Overview
Improving Workflow and Efficiency in Administrative Processes
Quantum Associates, Inc 2015
What is Lean?
• Lean focuses on eliminating waste in
processes
• Lean is not about eliminating people
• Lean is about expa...
Thinking Lean
• Specify value
– can only be defined by the ultimate customer
• Identify the value stream
– exposes the eno...
“In America today we have good people
working in poor processes.What we want
is good people working in great processes”
Mi...
Benefits
• Lean provides tangible benefits
• Reduces costs not just selling price
– Reduces delivery time, cycle time, set...
Definitions
• Value - A capability provided to a customer at
the right time at an appropriate price, as
defined in each ca...
Three Types of Office Activities
• Value-added activities
• Business non-value-added
activities
• Non-value added activiti...
Value-added Activities
• Those steps the customer is willing to pay for
• To qualify as value-added an activity must meet
...
Business Non-Value-Added Activities
• Activities the customer isn’t willing to pay
for but must be done to comply with
reg...
Non-value-added Activities
• Those activities the customer is not willing
to pay for and can be avoided
• Your goal should...
Types of Waste
• Overproduction
• Excess inventory
• Defects
• Non-value added processing
• Waiting
• Excess motion
• Tran...
Eight Service Industry Wastes
1. Errors in documents
2. Transport of documents
3. Doing unnecessary work not requested
4. ...
Examples of Office Process Waste
•Too many signature levels
•Unclear job descriptions
• Obsolete databases/files/folders
•...
The Eight Deadly Wastes
• Waiting Waste
– Waiting for anything—people paper, machines or information
– Waiting means idle ...
The Eight Deadly Wastes
• Transportation Waste
– Transporting something farther than necessary
– Temporarily filing, stock...
The Eight Deadly Wastes
• Over-Processing Waste
– Unnecessary effort which adds no value to a product or
service
– Redunda...
The Eight Deadly Wastes
• Inventory Waste
– Any supply of materials in excess of what is required to deliver
services in a...
The Eight Deadly Wastes
• Motion Waste
– All unnecessary work or people movement
– Ineffective job processes and layout co...
The Eight Deadly Wastes
• Defect Waste
– Waste as a result of defective work
– Rework—doing something over
– Incorrect inf...
The Eight Deadly Wastes
• Skills Underutilization
– Is a result of not placing people where they can
(and will) use their ...
Lean vs. Traditional
• Major reduction in sales-order cycle time by
59 percent (from 23 hours to 9 hours)
• Engineering ch...
Lean Enterprise vs. Traditional
• Half the hours of engineering effort
• Half the product development time
• Half the inve...
Barriers to Lean
• Implementing Lean Can Be Difficult Because it is
Counterintuitive from a Traditional Paradigm:
– Provid...
Implementing Lean
• Gain top Management “Buy In” and Support
• Perform overall company assessment tied to company strategi...
Progress Toward Lean
• Smaller batch sizes
• Increased capacity / throughput
• More available floor space
• Improved workp...
Some Lean Concepts
• Kaizen
• Pull
• Lean Office Suggestions
26Quantum Associates, Inc 2015
What is Kaizen?
• Kaizen (Ky’zen)
• “Kai” means “change”
• “zen” means “good (for the better)”
• Gradual, orderly, and con...
How to Kaizen
• Identify the customer
• PDCA Cycle
– Plan – identify what to change and how to do it
• Current state
• Fut...
Kaizen—Identify the Customer
• Value added is always determined from the
customer’s perspective.
• Who is the customer?
• ...
Kaizen—Identify the Current State
• Crucial first step in process improvement
• Deep understanding of the existing process...
Kaizen—Brainstorm and Analyze
• Kaizen team brainstorming to develop new process
• Post improvement ideas on map or by cat...
Kaizen—Implementation Plan
• Think global / systems optimization
• Maximum impact to process
• Speed of implementation – c...
Kaizen—Execute
• Develop a concise, achievable milestone plan
• Communicate the plan to everyone
– Suppliers
– Team member...
Kaizen—Check and Sustain
• Meet regularly (weekly?) to review status of
open implementation items
• Re-evaluate Future Sta...
Kaizen Blitz
• Total focus on a defined process to create
radical improvement in a short period of time
• Dramatic improve...
Kaizen Blitz - Agenda
• Day 1: Setting the scene
– Meet the team, training
• Day 2: Observe the current process
– Flowchar...
10/15% 10/20% 5% 60/75%
90%5% 5%
Adm/clerical
-filing
-typing
-mailing
-gathering data
General phone
Inquiries from
member...
Roadblocks To Kaizen
• Too busy to study it
• A good idea but the timing is premature
• Not in the budget
• Theory is diff...
Why Pull?
Lean is really about minimizing waste
• Which is about only creating work (or
work units) required by the
downst...
Continuous Flow
• Continuous flow means producing work
according to three key principles
– Only what is needed
– Just when...
• Actual customer demand drives the process.
• It creates a system of cascading requirements and
delivery instructions fro...
Lean Office Suggestions
• 5S Discipline
– Segregate your information into three categories
(applies to hard and electronic...
Lean Office Suggestions
• Keep the Value Stream Flowing
– Focus on keeping your value stream flowing. Deal with
the work t...
Lean Office Suggestions
– Benefits
• When you rigorously apply the 4Ds nothing will return
to the inbox
– Value will conti...
Lean Office Suggestions
• Smoothing the Flow
– Cut down needless interruptions with schedules—times that
each employee is ...
DO NOT BE
AFRAID, MY
FRIEND
46Quantum Associates, Inc 2015
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Lean office overview 2015

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Improving workflow and efficiency in administrative processes, Lean Office, lean process improvement, office waste, eight deadly wastes, Willie Carter, Quantum Associates, Inc.

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Lean office overview 2015

  1. 1. Lean Office Overview Improving Workflow and Efficiency in Administrative Processes Quantum Associates, Inc 2015
  2. 2. What is Lean? • Lean focuses on eliminating waste in processes • Lean is not about eliminating people • Lean is about expanding capacity by reducing costs and shortening cycle times • Lean is about understanding what is important to the internal or external customer 2Quantum Associates, Inc 2015
  3. 3. Thinking Lean • Specify value – can only be defined by the ultimate customer • Identify the value stream – exposes the enormous amounts of waste • Create flow – reduce batch size and WIP • Let the customer pull product through the value stream – make only what the customer has ordered • Seek perfection – continuously improve quality and eliminate waste From Lean Thinking by Womack and Jones 3Quantum Associates, Inc 2015
  4. 4. “In America today we have good people working in poor processes.What we want is good people working in great processes” Michael Hammer Thinking Lean 4Quantum Associates, Inc 2015
  5. 5. Benefits • Lean provides tangible benefits • Reduces costs not just selling price – Reduces delivery time, cycle time, set-up time – Eliminates waste – Seeks continuous improvement • Improves quality • Improves customer ratings and perceptions • Increases overall customer satisfaction • Improves employee involvement, morale, and company culture • Helps “transform” organizations 5Quantum Associates, Inc 2015
  6. 6. Definitions • Value - A capability provided to a customer at the right time at an appropriate price, as defined in each case by the customer. Features of the product or service, availability, cost and performance are dimensions of value. • Waste - Any activity that consumes resources but creates no value 6Quantum Associates, Inc 2015
  7. 7. Three Types of Office Activities • Value-added activities • Business non-value-added activities • Non-value added activities 7Quantum Associates, Inc 2015
  8. 8. Value-added Activities • Those steps the customer is willing to pay for • To qualify as value-added an activity must meet the following criteria: – It changes the form, feature, or function that the customer desires – It must be “done right the first time” – The customer is willing to pay for it “It is the customer who determines what a business is.What the customer thinks he is buying, what he considers ‘value,’ is decisive—it determines what a business is, what it produces and whether it will prosper.” –Peter Drucker 8Quantum Associates, Inc 2015
  9. 9. Business Non-Value-Added Activities • Activities the customer isn’t willing to pay for but must be done to comply with regulations, organizational policies, and so on • You must periodically examine these activities to make sure they are necessary, if not eliminate them 9Quantum Associates, Inc 2015
  10. 10. Non-value-added Activities • Those activities the customer is not willing to pay for and can be avoided • Your goal should be to eliminate these activities because they are WASTE 10Quantum Associates, Inc 2015
  11. 11. Types of Waste • Overproduction • Excess inventory • Defects • Non-value added processing • Waiting • Excess motion • Transportation • Underutilization of people 11Quantum Associates, Inc 2015
  12. 12. Eight Service Industry Wastes 1. Errors in documents 2. Transport of documents 3. Doing unnecessary work not requested 4. Waiting for the next process step 5. Process of getting approvals 6. Unnecessary motions 7. Backlog in work queues 8. People not working to their full potential 12Quantum Associates, Inc 2015
  13. 13. Examples of Office Process Waste •Too many signature levels •Unclear job descriptions • Obsolete databases/files/folders • Purchase Orders not matching quotation • Errors – typo’s, misspelling, wrong data • Waiting – for information, at meetings, etc. • Poor office layout • Unnecessary E-mails 13Quantum Associates, Inc 2015
  14. 14. The Eight Deadly Wastes • Waiting Waste – Waiting for anything—people paper, machines or information – Waiting means idle time, and that cause the flow of work to stop – Documents waiting in your in-box or emails waiting to be answered, documents waiting for approval To Eliminate this Type of Waste • Review and standardize required signatures to eliminate unnecessary ones • Cross train employees to allow work to continue when someone is out • Balance the workload throughout the day to make optimum use of people • Make sure equipment and supplies are available 14Quantum Associates, Inc 2015
  15. 15. The Eight Deadly Wastes • Transportation Waste – Transporting something farther than necessary – Temporarily filing, stocking, stacking, or moving materials, people, information or paper – Transportation waste can occur where work stations are not properly laid out To Eliminate this Type of Waste • Make the distance over which paper, information, etc is moved as short as possible • Eliminate any temporary storage or stocking locations 15Quantum Associates, Inc 2015
  16. 16. The Eight Deadly Wastes • Over-Processing Waste – Unnecessary effort which adds no value to a product or service – Redundant activities such as checking someone else’s work – Obtaining multiple signatures or excessive reviews To Eliminate this Type of Waste • Review the value-added steps in each process, and streamline or eliminate steps whenever possible • Review all signature requirements and eliminate signatures whenever possible 16Quantum Associates, Inc 2015
  17. 17. The Eight Deadly Wastes • Inventory Waste – Any supply of materials in excess of what is required to deliver services in a Just-In-Time Manner – Unneeded files, extra supplies, and unnecessary copies – This waste is also related to time. Time is a valuable commodity in the office environment, and a work unit sitting on someone’s desk is waste To Eliminate this Type of Waste • Produce only enough to satisfy the requirements of your downstream customer • Standardize work locations and the number of units per location • Make sure that work arrives at the downstream process when it is needed and doesn’t sit there 17Quantum Associates, Inc 2015
  18. 18. The Eight Deadly Wastes • Motion Waste – All unnecessary work or people movement – Ineffective job processes and layout contribute to more walking, reaching or bending than necessary To Eliminate this Type of Waste • Standardize folders, drawers, and cabinets throughout the area—use color codes • Arrange your files (paper and electronic) in such a way to easily reference them • Arrange work areas of office equipment in central locations—consider purchasing additional equipment to eliminate multiple trips 18Quantum Associates, Inc 2015
  19. 19. The Eight Deadly Wastes • Defect Waste – Waste as a result of defective work – Rework—doing something over – Incorrect information on a form or missed deadlines To Eliminate this Type of Waste • Establish standardized work procedures and office forms • Create and post visual job aids 19Quantum Associates, Inc 2015
  20. 20. The Eight Deadly Wastes • Skills Underutilization – Is a result of not placing people where they can (and will) use their knowledge, skills, and abilities to the fullest To Eliminate this Type of Waste • Involve people in the lean transformation • Empower your staff to make improvements • Listen to new ideas for improvement and implement them when possible 20Quantum Associates, Inc 2015
  21. 21. Lean vs. Traditional • Major reduction in sales-order cycle time by 59 percent (from 23 hours to 9 hours) • Engineering change-order cycle time decreased by 91 percent (from two hours to ten minutes) • Response time to customer’s quote requests reduced by 83 percent (from 66 hours to 11 hours) • Errors by company employees were reduced by 69 percent (Tonya, 2004) 21Quantum Associates, Inc 2015
  22. 22. Lean Enterprise vs. Traditional • Half the hours of engineering effort • Half the product development time • Half the investment in machinery, tools and equipment • Half the hours of human effort • Half the defects in the finished product or service • Half the space for the same output • A tenth or less of in-process inventories Source: The Machine that Changed the World, Womack, Jones, and Roos, 1990. 22Quantum Associates, Inc 2015
  23. 23. Barriers to Lean • Implementing Lean Can Be Difficult Because it is Counterintuitive from a Traditional Paradigm: – Providing documents or information at the rate demanded by the customer instead of batching documents – Cross training instead of putting activities on hold until the one person who knows how to perform the activity can get to it – Using standards to continuously improve. • There is no step-by-step cook book – There are some basic steps but the how-to varies from organization to organization – Requires an assessment of the company in order to map out the strategy • Company culture plays a big part in the how-to 23Quantum Associates, Inc 2015
  24. 24. Implementing Lean • Gain top Management “Buy In” and Support • Perform overall company assessment tied to company strategic, operational, and marketing plans • Develop strategic lean deployment plan • Integrate customized training with lean to improve specific skill sets, leverage training resources • Team Building, Communications, Problem Solving, Change Management, Lean Manufacturing Tools • Conduct “Kaizen blitz” high impact events • 5S, Work Cell, Set-Up Reductions, Inventory Reductions, Work Standardization • Use an enterprise wide approach to help “Transform” your culture and the way you do business. 24Quantum Associates, Inc 2015
  25. 25. Progress Toward Lean • Smaller batch sizes • Increased capacity / throughput • More available floor space • Improved workplace organization • Improved quality : reduced defects / re-work • Reduced lead times • Improved participation & morale 25Quantum Associates, Inc 2015
  26. 26. Some Lean Concepts • Kaizen • Pull • Lean Office Suggestions 26Quantum Associates, Inc 2015
  27. 27. What is Kaizen? • Kaizen (Ky’zen) • “Kai” means “change” • “zen” means “good (for the better)” • Gradual, orderly, and continuous improvement • Ongoing improvement involving everyone 27Quantum Associates, Inc 2015
  28. 28. How to Kaizen • Identify the customer • PDCA Cycle – Plan – identify what to change and how to do it • Current state • Future state • Implementation plan – Do – execute the improvement – Check – ensure the improvement works – Adjust – future and ongoing improvements – Repeat 28Quantum Associates, Inc 2015
  29. 29. Kaizen—Identify the Customer • Value added is always determined from the customer’s perspective. • Who is the customer? • Every process should be focused on adding value to the customer. • Anything that does not add value is waste. • Some non-valued added activity is necessary waste (“NVA-R”) – Regulatory – Legal 29Quantum Associates, Inc 2015
  30. 30. Kaizen—Identify the Current State • Crucial first step in process improvement • Deep understanding of the existing processes and dependencies • Identify all the activities currently involved in developing a new product • Observe the process first hand • Identify Value Added (VA), Non-Value Added Required (NVA-R), and Non-Value Added (NVA) • Generally creates more questions than answers 30Quantum Associates, Inc 2015
  31. 31. Kaizen—Brainstorm and Analyze • Kaizen team brainstorming to develop new process • Post improvement ideas on map or by category – Workflow – Technology – People / Organization – Procedures • Develop detailed future state map – New workflow – Value Add and Non-Value Add – Cycle times – Identify Kaizen “bursts” (immediate radical change) 31Quantum Associates, Inc 2015
  32. 32. Kaizen—Implementation Plan • Think global / systems optimization • Maximum impact to process • Speed of implementation – create small victories • Cost-benefit analysis 32Quantum Associates, Inc 2015
  33. 33. Kaizen—Execute • Develop a concise, achievable milestone plan • Communicate the plan to everyone – Suppliers – Team members – Customers • Track activities in public • Celebrate small victories and publicly analyze failures 33Quantum Associates, Inc 2015
  34. 34. Kaizen—Check and Sustain • Meet regularly (weekly?) to review status of open implementation items • Re-evaluate Future State regularly (quarterly?) for additional improvement • Track results on a public Kaizen Board 34Quantum Associates, Inc 2015
  35. 35. Kaizen Blitz • Total focus on a defined process to create radical improvement in a short period of time • Dramatic improvements in productivity, quality, delivery, lead-time, set-up time, space utilization, work in process, workplace organization • Typically five days (one week) long 35Quantum Associates, Inc 2015
  36. 36. Kaizen Blitz - Agenda • Day 1: Setting the scene – Meet the team, training • Day 2: Observe the current process – Flowchart, identify waste, identify root causes • Day 3: Develop the future state process – Brainstorm and flowchart (typically the longest day!) • Day 4: Implement the new process – Plan, communicate, implement, modify • Day 5: Report and analyze – Performance vs. expectations 36Quantum Associates, Inc 2015
  37. 37. 10/15% 10/20% 5% 60/75% 90%5% 5% Adm/clerical -filing -typing -mailing -gathering data General phone Inquiries from members Fill in for Other staff Loan Processing Phone inquiries Loans only Fill in for Other staff Loan Processing Example – Financial Institution Time spent by Loan Processor – Old Process New Lean Process after Kaizen Event NVA VA BNVA 37Quantum Associates, Inc 2015
  38. 38. Roadblocks To Kaizen • Too busy to study it • A good idea but the timing is premature • Not in the budget • Theory is different from practice • Isn’t there something else for you to do? • Doesn’t match corporate policy • Not our business – let someone else analyze it • It’s not improvement – it’s common sense • I know the result even if we don’t do it • Fear of accountability • Isn’t there an even better way? 38Quantum Associates, Inc 2015
  39. 39. Why Pull? Lean is really about minimizing waste • Which is about only creating work (or work units) required by the downstream process (or customer) • Which is about seamless continuous flow 39Quantum Associates, Inc 2015
  40. 40. Continuous Flow • Continuous flow means producing work according to three key principles – Only what is needed – Just when it is needed – In the exact amount needed 40Quantum Associates, Inc 2015
  41. 41. • Actual customer demand drives the process. • It creates a system of cascading requirements and delivery instructions from downstream customers to upstream processes in which nothing is produced by the upstream supplier until the downstream customer signals a need. • The rate of production for each product/service is equal to the rate of customer demand. Pull Production 41Quantum Associates, Inc 2015
  42. 42. Lean Office Suggestions • 5S Discipline – Segregate your information into three categories (applies to hard and electronic information) • Working • Reference • Archive – Then cull the obsolete garbage. – Benefit • Reduces the waste of motion and time spent searching for your work 42Quantum Associates, Inc 2015
  43. 43. Lean Office Suggestions • Keep the Value Stream Flowing – Focus on keeping your value stream flowing. Deal with the work that enters your system—an email, a phone call, a memo, a project, etc—by taking one of four courses of action (4Ds): • Doing it • Delegating it • Designating time to address it • Dumping it 43Quantum Associates, Inc 2015
  44. 44. Lean Office Suggestions – Benefits • When you rigorously apply the 4Ds nothing will return to the inbox – Value will continue to move forward – Significant reduction in the amount of time spent working a backlog – Significant reduction in the amount of time spent processing emails 44Quantum Associates, Inc 2015
  45. 45. Lean Office Suggestions • Smoothing the Flow – Cut down needless interruptions with schedules—times that each employee is available for meeting for conversation – Establish sustainable service level agreements for email responses rather than supporting the expectation of instant response – Reduce the amount of multi-tasking in favor of single tasks, creating the understanding that doing one task at a time is actually faster and more efficient – Benefits • Significant reduction in time lost due to interruptions • Improved productivity 45Quantum Associates, Inc 2015
  46. 46. DO NOT BE AFRAID, MY FRIEND 46Quantum Associates, Inc 2015

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