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Carlo Scodanibbio presents:

      The Lean Enterprise
                               (Lean Thinking)
    ” if it doesn't ...
Airlines...




THE STORY…
    STORY…




             the fax!!



                         2
Banks...




Car Hire...


              3
5* Hotel...




Customer
 Care...

              4
LEAN THINKING: THE ORIGIN 1
              Maybe you fish it…..
                             it…




LEAN THINKING: THE ORI...
LEAN THINKING: THE ORIGIN 1
            …maybe you mine it…..
                            it…




LEAN THINKING: THE ORIGI...
LEAN THINKING: THE ORIGIN 1
             …maybe you mill it…..
                             it…




LEAN THINKING: THE ORI...
LEAN THINKING: THE ORIGIN 1
       …maybe you manufacture it…..
                              it…




LEAN THINKING: THE O...
LEAN THINKING: THE ORIGIN 1
         …maybe you simply sell it…..
                                it…




LEAN THINKING: T...
LEAN THINKING: THE ORIGIN 1
You catch it, you farm it,
you mine it, you breed it,
 you mill it, you brew it,
   you manufa...
LEAN THINKING: THE ORIGIN 2
Everyone that works in your organization is doing one of three things:
                       ...
….so, you would like your enterprise to be:


 Efficient – Profitable – Modern –
 Productive – Financially sound -
satisfy...
This is possible: it can be achieved…

             ….it depends on you,
   entrepreneurs and managers…..

  ..it’s just y...
STEP 1)
 Understand the environmental
     change and manage it




 ….the world has changed….




                       ...
COMPLEXITY




      clients are monsters….




                               15
STEP 2)
Be prepared to abandon the
 “formula”




  the “formula”:
  the “Campari” syndrome




                          ...
the “formula”
The “secrets” of success
The do’s and don’ts
The “taboo” and “holy cows”
The “how to do things”
The areas of...
protect the “formula”!
The Formula must be protected, because it has
  generated success for many years:

        -- > res...
effects of the “formula”
Top and mid level managers, with time, get used to the
   Formula, and learn how to stick to it.
...
the obsession to change
                  (the “formula”…)
                        formula”…)

    The Formula is “blocked...
homework?
..oh, yes!!!
spot the “formula”



                     21
STEP 3)
Have a clear direction in your
 mind….. (and tell people about it….)
                                it…




     ...
TELL YOUR PEOPLE ABOUT THE
        “LEAN” DIRECTION
 BUT!! before doing so, some check-points:
“…is the vision shared at t...
world-class,
      “lean”
   performance
performance management




performance management

4 necessary steps
1 - MEASURE ...
Step 1
HOW TO MEASURE
 PERFORMANCE
…..know where you stand!!!
…..know where you are!!!




Enterprise Performance




    ...
THE MAIN COMPONENTS OF
        ENTERPRISE’S PERFORMANCE
       examples               (KEY PERFORMANCE COMPONENTS – KPC)

...
THE MAIN COMPONENTS OF
         ENTERPRISE’S PERFORMANCE
        examples             (KEY PERFORMANCE COMPONENTS – KPC)

...
THE MAIN COMPONENTS OF
       ENTERPRISE’S PERFORMANCE
      examples            (PROCESS PERFORMANCE INDICATORS)


Produc...
MEASURING QUANTIFIABLE PERFORMANCE COMPONENTS


    Certain Performance Components may
         be mathematically measured...
COMPANY CLIMATE QUESTIONNAIRE




       Year 2007                   Year 2008




            INDEXING METHODS
          ...
SOME EXAMPLES OF COMMERCIAL INDICES
Ims = Market Share Index = 100 x Sales ($)/Overall Market Value ($)

     Inc = New Cl...
GRAPHIC REPRESENTATION OF PERFORMANCE
  examples   COMPONENTS




GRAPHIC REPRESENTATION OF PERFORMANCE
  examples   COMPO...
GRAPHIC REPRESENTATION OF PERFORMANCE
example: Radar Chart COMPONENTS




 why enterprises don’t “perform”...
    ….the ro...
Why do all traditional Management
   techniques and disciplines somehow fail?

Management by Objectives, Effective Leaders...
ORGANISATIONAL
  STRUCTURES
 …..that support an effective
Employee Involvement scheme
 and allow higher levels of
        ...
REAL ENTITIES




effective Human Resources
  Management Strategies




                            36
effective Human Resources
  Management Strategies




EFFECTIVE HR MANAGEMENT STRATEGIES




                             ...
EFFECTIVE HR MANAGEMENT STRATEGIES




EFFECTIVE HR MANAGEMENT STRATEGIES




                                     38
EFFECTIVE HR MANAGEMENT STRATEGIES




EFFECTIVE HR MANAGEMENT STRATEGIES




                                     39
EFFECTIVE HR MANAGEMENT STRATEGIES




  “...the worst thing that could possibly
happen to an enterprise and its employees...
EXAMPLES OF “MIS-MATCH”




              E2              M2



                               E1
               M1




  ...
SCANNING AN ORGANISATIONAL STRUCTURE
                            area: cultural values
• typical of the "technology" era w...
SCANNING AN ORGANISATIONAL STRUCTURE
                                                          area: relationship with mar...
SCANNING AN ORGANISATIONAL STRUCTURE
                                                  area: organisation & management
• "...
SCANNING AN ORGANISATIONAL STRUCTURE
                                                               area: relationship wit...
SCANNING AN ORGANISATIONAL STRUCTURE
                        area: procurement & relationship with suppliers
• Buy at the ...
WORLD-CLASSPERFORMANCE
    WORLD-CLASS
                PERFORMANCE



   the lean enterprise
 operates “per process”




 ...
UNDERSTANDING PROCESSES

           CENTRAL PROCESS
                                                           articulated...
TODAY'S ULTIMATE SECRET FOR
LEAN PERFORMANCE, EXCELLENCE
    AND COMPETITIVENESS:




            FLOW PROCESS




       ...
FLOW PROCESS
                                           Main features
Value delivering, dynamic, flexible, Flow
   Process...
FLOW PROCESS
                                           Main features



 Management: from supervision to coaching
    (tr...
LPM
 Lean
Project
Mangmt




          52
FP
 Flow
Process




          VAM
  VALUE ADDING
  MANAGEMENT




                 53
the VAM approach to the productive process




process
 time
analysis




      FRIGHTENING…….
                           ...
SEW
     SYSTEMATIC
ELIMINATION OF WASTE




VALUE!



                       55
56
SUMMARY OF THE MAIN TYPES OF WASTE
Overproduction
Stock
Un-needed processing steps
Motion
Control
Defects
Waiting/idling
T...
WASTE – THE TABLE OF EXCUSES - OLD
1) That's the way we have always done it
2) I didn't know you were in a hurry for it
3)...
spot the waste!



 LEAN MANUFACTURING
 and FLOW PRODUCTION
 continuous flow
the target:




     pipeline flow


        ...
Lean Manufacturing uses less of everything
      compared with mass production:
 half the human effort in the factory, hal...
LOT PRODUCTION VS. FLOW PRODUCTION




                                     61
LOT PRODUCTION VS. FLOW PRODUCTION




LOT PRODUCTION VS. FLOW PRODUCTION




                                     62
LOT PRODUCTION VS. FLOW PRODUCTION




LOT PRODUCTION VS. FLOW PRODUCTION




                                     63
fake flow production
  the “conveyor” method




LOT PRODUCTION VS. FLOW PRODUCTION




                                  ...
“batch production” vs.
     “one-piece flow”




batch production vs. one-piece flow
                    ANALYSIS




    ...
The role of Lean Disciplines in
developing Employee Involvement




 The role of
    Lean
Disciplines in
 developing
 Empl...
the “SOCO” (5S) approach




  non-soco examples




                           67
a soco story
a soco factory
  5S in action




a soco factory
  5S in action




                 68
U-CELL
   MANUFACTURING
   ONE-PIECE FLOW




   cell manufacturing
labour/machines situation




                        ...
Lean Manufacturing and
Total Quality Management

  THE POKA-YOKE DISCIPLINE
      POKA-
 100% TESTING APPROACHES

  THE 6 ...
TOTAL QUALITY MANAGEMENT
APPROACHES TO TQM




TOTAL QUALITY MANAGEMENT

  implementing a Quality
    Assurance or Total
 ...
FLOW PRODUCTION - THE QUALITY ISSUE
                     The 5 QA Achievement Levels


1) Defective product is delivered t...
FLOW PRODUCTION - THE QUALITY ISSUE
    Quality Inspection built-into the
                       built-
  productive proce...
100% testing
a world-class enterprise dedicated
     to 100% quality testing




  The 6-Sigma
      6-Sigma
  Methodology...
poka-yoke




            75
MISTAKE-PROOFING IN EVERYDAY’S LIFE
MISTAKE-            EVERYDAY’




MISTAKE-PROOFING IN EVERYDAY’S LIFE
MISTAKE-        ...
MISTAKE-PROOFING IN EVERYDAY’S LIFE
MISTAKE-            EVERYDAY’




     POKA-YOKE APPLICATIONS
     POKA-




         ...
POKA-YOKE APPLICATIONS
       POKA-




FLOW PRODUCTION - THE QUALITY ISSUE
              The “turn-this-board” strategy

...
FLOW PRODUCTION - THE QUALITY ISSUE
              The “turn-this-board” strategy




HEAVY MECHANISATION /
     AUTOMATION...
80
“traditional” TPM
                                             definition
PARTICIPATIVE PROGRAMS DESIGNED TO INCREASE
EQUI...
“traditional” TPM
                                            goals
TOTAL INVOLVEMENT OF PEOPLE FROM ALL DEPTS.
   THAT PL...
spot the waste!
people and machines




                      83
THE 6 BIG LOSSES




                   84
THE 6 BIG LOSSES




THE 6 BIG LOSSES




                   85
PREVENTIVE MAINTENANCE
AUTONOMOUS MAINTENANCE
    the hearts of TPM




  The new relationship between
  Maintenance and P...
VALUE STREAM MANAGEMENT
                  VSM storyboard




   PROCESS MAPPING




                                   87
PROCESS MAPPING




PROCESS MAPPING
      PROCESS ROUTE ANALYSIS
          GROUP-TECHNOLOGY
          GROUP-




         ...
PROCESS MAPPING
      PROCESS ROUTE ANALYSIS
          GROUP-TECHNOLOGY
          GROUP-




PROCESS MAPPING
      PROCESS...
PROCESS MAPPING
                 PROCESS ROUTE ANALYSIS
                     GROUP-TECHNOLOGY
                     GROUP-
...
FROM


A TRADITIONAL
IMPROVEMENTS
    LIST….




    ..TO


THE MILESTONE
  CHARTER




                91
LEAN
   THINKING
        what is it?


                            The key to WCP: LEAN THINKING

  LEAN THINKING: what is...
The key to WCP: LEAN THINKING

  LEAN THINKING: what is it?
Based on 5 core concepts:

4. Pull: or making the value stream...
The key to WCP: LEAN THINKING

  LEAN THINKING: what is it?
Very preliminary targets:
  Reduce the steps by half
  Reduce ...
The key to WCP: LEAN THINKING

 LEAN THINKING: resistance
RESISTANCE TO LEAN TRANSITION
 It will feel wrong… taking apart
...
the “conveyor” mentality




LEAN THINKING – who cares?
 Worker/employee: “…why should I
 Worker/employee: “…why
  care?”
...
The key to WCP: LEAN THINKING

    LEAN THINKING: the tools
Some of the tools for seeing waste:                 and:

  5W...
LEAN THINKING: the tools
                                         5WHYs

  WHY?
  WHY?
  WHY?
  WHY?
  WHY?



           ...
LEAN THINKING: the tools
                                      Communication Circles
  issue          John

              ...
LEAN THINKING: the tools
                                           Time Observation
    With Time Observations you determ...
LEAN THINKING: the tools
                                               Bar Chart
Displays Time Observation data
         ...
YEARS 2000
FACTORS OF COMPETITIVENESS




  Creativity



               the 6 thinking hats




                         ...
Flow Processing in any Industry


  EXERCISE???

   …..oh, yes!!!
   scrap-yard operations 2 – scrap cans
   scrap-




sc...
…are Lean Thinking
  and Flow Process
   principles and
 techniques suited
to all industries?




The answer is always:


...
Lean Thinking in the Service Industry




          Flow Processing




          spot the waste!
        Service Industry...
look at the pearls!
 (Service Industry)




  The “pearls” in the Service Industry
drop your comments…
          comments…...
Flow Processing in the Service Industry



The Service Industry offers numerous examples of good,
Flowing Processes and ba...
IDEAMATRIX
                                  features, characteristics…. go here
                                         ...
Flow Processing in the Service Industry


  EXERCISE???

   …..oh, yes!!!
                      BRA-FITTING




Deploying ...
Deploying VSM and other LT
       tools in other
   Industries/Processes

                        b) administration




CO...
Lean Thinking in the Project Industry

    Lean Project
     Management
 Lean Construction
     Management




    TRADITI...
TRADITIONAL PROJECT MANAGEMENT




 TRADITIONAL PROJECT MANAGEMENT
PROJECT PARAMETERS




                                ...
TRADITIONAL PROJECT MANAGEMENT
                     key principles




TRADITIONAL PROJECT MANAGEMENT
                    ...
the need…




Typical symptoms of Projects with low
PROJECT MANAGEMENT content
Project Start : slow, hesitant, difficult
D...
Typical symptoms of Projects with low
PROJECT MANAGEMENT content
Inefficient resources utilisation
Waste - Rejects and Def...
Likely causes:
Project Manager lacking strategic abilities
Excessive conflicts - PM lacking conflicts management abilities...
117
conventional management…




…and matrix management




                           118
never start a project unless all resources are available….
                                               available…




 ...
PLANNING
PROGRAMMING
SCHEDULING
CONTROLLING



              120
LIFECYCLE OF PROJECT WITH POOR PLANNING


Project initiation

Wild enthusiasm

Disillusionment

Wild chaos

Search for the...
THE BOTTOM LINE…




                   Calculation Sheet




            introducing:


       LEAN
PROJECT MANAGEMENT

 ...
Lean Project
 Management
      foreword




LEAN PROJECT MANAGEMENT        foreword
              WHY DO SOME PROJECTS FAI...
LEAN PROJECT MANAGEMENT
      “the project/construction
    industry is in some ways not
    completely shifted from craft...
spot the waste!
Construction Industry 1
                     EXAMPLES




   spot the waste!
Construction Industry 2
     ...
any correlation between what you have seen and your work of every day?
                                                   ...
LEAN PROJECT MANAGEMENT
            analysis of traditional planning inadequacies

In project/construction works, the
   e...
LEAN PROJECT MANAGEMENT
                   analysis of traditional planning inadequacies
Planning (schedules, budgets, etc...
LEAN PROJECT MANAGEMENT


taking the lean way
taking
         the lean
                        way


LEAN PROJECT MANAGEME...
LEAN PROJECT MANAGEMENT
Based on the same 5 Core Principles as Lean Thinking:



1.Value
2.Value Stream
3.Flow
4.Pull
5.Ex...
LEAN PROJECT MANAGEMENT
                  lean planning and the “last planner”
                                           ...
LEAN PROJECT MANAGEMENT
                 project objectives
                                                        lean p...
LEAN PROJECT MANAGEMENT

       who is the “Last Planner”?

ideally….

everybody!

    Lean Project
   Management in
   Mu...
THE BI-TUBE
  PROJECT
                   ANALYSIS




 can construction
become different?
  look at this!!




           ...
LEAN THINKING
               AND
      TECHNOLOGY




 LEAN THINKING AND TECHNOLOGY

Remember! In a lean environment:

1st...
LEAN THINKING AND TECHNOLOGY




                 technology cul-de-sac




                 technology cul-de-sac




   ...
LEAN THINKING

       PRINCIPLES

        IN OTHER

PROJECT-DRIVEN INDUSTRIES




    Spot the Waste!
    Steel Fabricatio...
LEAN THINKING
         AND
       SAFETY




non-lean safety examples




                           138
LEAN THINKING
                       AND
   THE CONTINUOUS
PROCESS INDUSTRY




   LEAN THINKING AND THE
CONTINUOUS PROCES...
LEAN THINKING AND THE
CONTINUOUS PROCESS INDUSTRY

Additional Target:

 eliminate the residual waste around the Flow




T...
Lean Thinking
                       and
     the Value Chain



Lean Thinking and the Value Chain
                       ...
RELATIONSHIP WITH
  SUPPLIERS IN A
  WORLD-CLASS
  ENVIRONMENT             s id
                              e
          ...
VENDORS CLASSIFICATION
                      IV CLASS - "NORMAL"                 III CLASS - "PERFORMING" SUPPLIER        ...
comakership
    the present and the future




International Lean Supply Chain - example




                             ...
THE CLIENT IS THE
                        ide
       KEY:   d em
                   an
                     ds




THE NEW...
the customer- and market-driven enterprise
    customer-     market-

 Enterprise committed to provide excellent quality
a...
the customer- and market-driven enterprise
    customer-     market-
                         Traditional enterprise      ...
148
Lean Thinking is not only concerned with
       waste elimination from processes…

 …to the contrary, Lean Thinking is ver...
OPPORTUNITIES: 1)




OPPORTUNITIES: 2)




                    150
OPPORTUNITIES: 3) the longest chain




 EXERCISE????

…oh, yes!!!!
                spot an opportunity




              ...
Lean Thinking
                             and
   the Marketing/Sales Process
      think like a customer!




 Lean Think...
Lean Thinking
       and

     Office Work
                   open debate




the deployment of TPM
  principles in other
...
Lean Thinking
       vs.

         6 Sigma




  LT vs. 6 Sigma




                   154
LT vs. 6 Sigma: one possible LT solution




LT vs. 6 Sigma: one possible LT solution




                                ...
Lean Thinking
  principles in
  developing new
products/services




a slight design mistake




                         ...
WORLD CLASS PRODUCT DEVELOPMENT
The main “State-of-the-Art” Disciplines are:
          State- of- the- Art”
  QFD (Quality...
CONCURRENT ENGINEERING

...another “Terminator” of
  Adam Smith theories…...




                             158
Lean Thinking and Software Development
                 Manufacturing wastes translated to software development

Overprodu...
“LEAN” STATUS
SELF-ASSESSMENT




a world-class
project-driven
  enterprise




                  160
LEAN THINKING

  THE EXCELLENCE TARGET




IMPROVING PERFORMANCE:
THE LEAN KAIZEN APPROACH
the bottom-up approach to Perfo...
today's KAIZEN

systematic and methodical approach, top-
                                     top-
   driven, co-ordinated...
the piers
of Kaizen




            163
KAIZEN & TEI
 .....the person doing the job
 knows far more than anyone
   else as to the best way of
doing that job, and ...
KAIZEN IS TEAMWORK!!!
                 vertically
              horizontally
                 internally
                e...
KAIZEN IS DECISION-MAKING
   ABILITY AND PRACTICE


    methodologies to approach the
      decision-making process:
Arche...
KAIZEN IS INTELLIGENT USE
OF THE OLD & NEW TOOLS FOR
    LEAN IMPROVEMENT
Data Collection Chart, Scatter Diagram, Control ...
team-work
     teamwork
    team- -work
    does it work?

                team-work

  Team-work – the solution?
The prin...
Team-work – the solution?
                    ….do you recall at least one

BUT:                meeting from which you (or...
Team-work – does it work?


EXERCISE????
 …oh, yes !!!!
           team exercising
                                   the ...
PEOPLE IN INDUSTRY

Engine (train) Drivers
Doctors
Farmers
Fishermen (Hunters)



                         171
EFFECTIVE HR MANAGEMENT STRATEGIES




 …if a person at the top is the most important, see what
   happens if a person at ...
HIGH (TOTAL) INVOLVEMENT
                                           in a nutshell

TEI is everyone in the Organisation dee...
HIGH (TOTAL) INVOLVEMENT
                       in a nutshell


   TEI is a system that
   stimulates people to
become res...
HIGH (TOTAL) INVOLVEMENT
                             in a nutshell



    TEI represents a continuous
challenge to people...
multi-skill, multi-function….




    high involvement….




                                176
high involvement….




getting highly involved….




                            177
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
The Lean Enterprise (Lean Thinking)
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The Lean Enterprise (Lean Thinking)

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The Lean Enterprise (Lean Thinking)

  1. 1. Carlo Scodanibbio presents: The Lean Enterprise (Lean Thinking) ” if it doesn't add value, it is waste” Lean Thinking is “lean” because it provides a way to do more with less while coming closer to providing customers with exactly what they want. a training event organised by: question Which is the primary objective of your Organisation? (one and one only) Key-Words: lean, manufacturing, power, point, presentation, value, waste, client, service, industry, perform, performance, world, class, operations, adding, management, productive, process, flow, processing, production, 5S, creativity, people, method, kaizen, improvement, hr, human, resources, strategy, strategies, tei, employee, involvement, responsibilities, course, carlo, scodanibbio, thinking, enterprise, stream, map, mapping, spaghetti, diagram, 5why, 5w1h, communication, circle, tool, project, construction, planning, last, planner, ppc, toc, quality, total, poka, yoke, poka-yoke, excellence, pull write it down on a piece of paper (1 minute) 1
  2. 2. Airlines... THE STORY… STORY… the fax!! 2
  3. 3. Banks... Car Hire... 3
  4. 4. 5* Hotel... Customer Care... 4
  5. 5. LEAN THINKING: THE ORIGIN 1 Maybe you fish it….. it… LEAN THINKING: THE ORIGIN 1 …maybe you farm it….. it… 5
  6. 6. LEAN THINKING: THE ORIGIN 1 …maybe you mine it….. it… LEAN THINKING: THE ORIGIN 1 …maybe you breed it….. it… 6
  7. 7. LEAN THINKING: THE ORIGIN 1 …maybe you mill it….. it… LEAN THINKING: THE ORIGIN 1 …maybe you brew it….. it… 7
  8. 8. LEAN THINKING: THE ORIGIN 1 …maybe you manufacture it….. it… LEAN THINKING: THE ORIGIN 1 …maybe you construct it….. it… 8
  9. 9. LEAN THINKING: THE ORIGIN 1 …maybe you simply sell it….. it… LEAN THINKING: THE ORIGIN 1 or maybe you dance it….. it… 9
  10. 10. LEAN THINKING: THE ORIGIN 1 You catch it, you farm it, you mine it, you breed it, you mill it, you brew it, you manufacture it, you construct it, you simply sell it or you dance it… …no matter what you do - you must generate…. LEAN THINKING: THE ORIGIN 1 VALUE for your customers 10
  11. 11. LEAN THINKING: THE ORIGIN 2 Everyone that works in your organization is doing one of three things: things: 1. They are generating value for your customers - or 2. They are creating or reshuffling waste – or 3. They are doing absolutely nothing The market leaders will always have the majority of their people dedicated to the first of these …in an office (or a bank, or a travel agent, or….) the floor or… cleaner may be adding more value than most employees.. ….so, you would like your enterprise to be: ?????? modern really satisfying clients and employees… guaranteed in its future…… financially sound… ???? productive profitable efficient 11
  12. 12. ….so, you would like your enterprise to be: Efficient – Profitable – Modern – Productive – Financially sound - satisfying clients and employees – Guaranteed in its future – ???? - ????? - ????????????? ..in a nutshell: you would like your enterprise to perform 12
  13. 13. This is possible: it can be achieved… ….it depends on you, entrepreneurs and managers….. ..it’s just your choice.. But: there are 3 necessary steps… ….you would like your enterprise to be: Efficient – Profitable – Modern – Productive – Financially sound – Capable of really satisfying clients and employees – Guaranteed in its future – ???? - ????? - ????????? THE 3 NECESSARY STEPS 1) Understand the environmental change and manage it 2) Be prepared to abandon the “formula” 3) Have a clear direction and tell people about it…. 4) ….and something more….. more… 13
  14. 14. STEP 1) Understand the environmental change and manage it ….the world has changed…. 14
  15. 15. COMPLEXITY clients are monsters…. 15
  16. 16. STEP 2) Be prepared to abandon the “formula” the “formula”: the “Campari” syndrome 16
  17. 17. the “formula” The “secrets” of success The do’s and don’ts The “taboo” and “holy cows” The “how to do things” The areas of “influence” The “who and what is to be respected” The “institutionalised” values and principles The rules The policies The procedures The “descriptions” (jobs, tasks…..) ………….. the “formula” EMPHASIS On 3 key departments: DESIGN/ENGINEERING TECHNOLOGY/OPERATIONS MARKETING/SALES Emphasis on Structure, Organisation, Hierarchy, Departments & “Compartments” Emphasis on Control (the “Controller”…..) Emphasis on Efficiency Emphasis on Stability 17
  18. 18. protect the “formula”! The Formula must be protected, because it has generated success for many years: -- > resistance to change! Protection = Vertical Control preserve its integrity! the GUARDIANS’ function: Vetting/Approving amendments to the formula or to its main parameters 18
  19. 19. effects of the “formula” Top and mid level managers, with time, get used to the Formula, and learn how to stick to it. At lower levels (supervisors, shop-floor workers), unwritten, similar rules filter down and become applied. Flexibility Reactivity little….. (or none) Innovation The Enterprise becomes “closed” People become “static” the “formula” (after midnight…) If some indicators start showing signals of serious inadequacy of the Formula all that may happen is a “reshuffle” of the old status-quo: Cost-cutting exercises Increase in efficiency of less powerful department/areas And/or: technological revamping 19
  20. 20. the obsession to change (the “formula”…) formula”…) The Formula is “blocked”, and the whole Organisation is slow and “reluctant to learn” If signals show very poor performance, the need to restructure the Formula and to change may become an obsession BUT: in the end things remain the same..... 20
  21. 21. homework? ..oh, yes!!! spot the “formula” 21
  22. 22. STEP 3) Have a clear direction in your mind….. (and tell people about it….) it… the vision 22
  23. 23. TELL YOUR PEOPLE ABOUT THE “LEAN” DIRECTION BUT!! before doing so, some check-points: “…is the vision shared at top/middle level?” “…is everybody in your enterprise - at top/middle level - convinced that people make the difference between failure and success?” “…is the “integration” concept clear and understood at top/middle level?” This is a “pass the Rubicon” situation Rubicon – there is no come back – it must go right. So, make your checks “before”! 23
  24. 24. world-class, “lean” performance performance management performance management 4 necessary steps 1 - MEASURE PERFORMANCE 2 – IDENTIFY THE GAP 3 - SET PATH TO IMPROVEMENT 4 - MAKE IT HAPPEN 24
  25. 25. Step 1 HOW TO MEASURE PERFORMANCE …..know where you stand!!! …..know where you are!!! Enterprise Performance 25
  26. 26. THE MAIN COMPONENTS OF ENTERPRISE’S PERFORMANCE examples (KEY PERFORMANCE COMPONENTS – KPC) COMMERCIAL PERFORMANCE Market penetration – Market share/expansion Effectiveness of Marketing Activities Sales Force Effectiveness Customer Loyalty Rate of Acquisition of New Customers Dealers/Wholesalers Performance Brand Identity Level Communication Effectiveness Reputation – Image THE MAIN COMPONENTS OF ENTERPRISE’S PERFORMANCE examples (KEY PERFORMANCE COMPONENTS – KPC) OPERATIONAL PERFORMANCE Operational Efficiency (Labour, Machines, Materials, Indirect Areas) Areas) Economical Efficiency (Labour, Materials…..) Materials… Productivity Quality of Product and Service Value Added Plant/Equipment Performance Personnel Performance 26
  27. 27. THE MAIN COMPONENTS OF ENTERPRISE’S PERFORMANCE examples (KEY PERFORMANCE COMPONENTS – KPC) ECONOMICAL PERFORMANCE Turnover Profitability CULTURAL PERFORMANCE Industrial Culture Level/Modernity Effectiveness of Change Management THE MAIN COMPONENTS OF ENTERPRISE’S PERFORMANCE (KEY PERFORMANCE COMPONENTS – KPC) Rather than to Functions and Departments, Performance Components should preferably be attached to Processes and sub- Processes tan t! por y im ve r 27
  28. 28. THE MAIN COMPONENTS OF ENTERPRISE’S PERFORMANCE examples (PROCESS PERFORMANCE INDICATORS) Product Development Process – “Achievement” factor Achievement” After-Sales Service Process – “Speed of Intervention” factor After- Intervention” Invoicing Process – “Correctness” factor Correctness” ….and, for instance… Goods Returned Management Process – “Functionality” factor Functionality” THE MAIN COMPONENTS OF ENTERPRISE’S PERFORMANCE (KEY PERFORMANCE COMPONENTS – KPC) All significant Performance Components (KPC) should be measured adequately If feasible, significant and practical, a Key Performance Indicator (KPI) KPI should be associated with a KPC to monitor it 28
  29. 29. MEASURING QUANTIFIABLE PERFORMANCE COMPONENTS Certain Performance Components may be mathematically measured MEASURING UN-QUANTIFIABLE PERFORMANCE COMPONENTS UN- Any (apparently) un-measurable Performance Component may actually be measured with the aid of suitable Questionnaires and Scoring Methods MEASURING UN-QUANTIFIABLE PERFORMANCE COMPONENTS UN- examples COMPANY CLIMATE QUESTIONNAIRE PARAMETERS interest in own work “physical” work environment physical” work flow and “fluidity” fluidity” work information inter-functional relationships inter- inter-personal relationships inter- relationships with Management Company (internal) Image 29
  30. 30. COMPANY CLIMATE QUESTIONNAIRE Year 2007 Year 2008 INDEXING METHODS Indices - Indicators - Ratios useful to understand and to monitor Performance Components behaviour and trends useful on their own and even more when put in relationship the one to the other possible to create an Index representing the overall behaviour of a number of Indices even possible to create an overall Enterprise Performance Index 30
  31. 31. SOME EXAMPLES OF COMMERCIAL INDICES Ims = Market Share Index = 100 x Sales ($)/Overall Market Value ($) Inc = New Clients Index = 100 x number of new clients/total number of clients Ilc = Lost Clients Index = 100 x number of lost clients/total number of clients Ici = Clients Increment Index = 100 x (number of year end clients – number of year start clients)/number of year start clients Iasc = Average Sales per Client Index = sales (quantity or $)/total number of client Icpc = Commercialisation of Productive Capacity Index = 100 x sales (quantity)/productive capacity (quantity) SOME EXAMPLES OF OTHER INDICES Isr = Stock Rotation Index = sales (at cost)/average stock (at cost) cost) Ise = Sales per Employee Index = total sales (turnover)/total number of number employees 31
  32. 32. GRAPHIC REPRESENTATION OF PERFORMANCE examples COMPONENTS GRAPHIC REPRESENTATION OF PERFORMANCE examples COMPONENTS 32
  33. 33. GRAPHIC REPRESENTATION OF PERFORMANCE example: Radar Chart COMPONENTS why enterprises don’t “perform”... ….the root causes of poor performance date back to over 2 centuries ago….. ago… ….we have gone into the 21st century, with enterprises designed in the 18th and 19th centuries to perform well in the 20th….. 33
  34. 34. Why do all traditional Management techniques and disciplines somehow fail? Management by Objectives, Effective Leadership, Diversification, Z Theory, Situational Leadership, Effective Communication, Zero- based-Budgeting, Decentralisation, Team Building, Management by Exception, Dale Carnegie techniques, Interpersonal Skills, Quality Circles, Excellence, Restructuring, Portfolio Management, Interactive Management, Matrix Organisational Structure, Total Quality Management, ISO 9000..... and One-Minute Managing...... Why is communication so difficult in many “traditional” enterprises? Why is real, non-spurious improvement so difficult to achieve in many enterprises? Why “functioning” well is so awkward in many “traditional” enterprises? Why do enterprises struggle both when they expand and when they are compelled to shrink? ..we have to look at organisational structures… 34
  35. 35. ORGANISATIONAL STRUCTURES …..that support an effective Employee Involvement scheme and allow higher levels of Performance ORGANISATIONAL STRATEGIES 35
  36. 36. REAL ENTITIES effective Human Resources Management Strategies 36
  37. 37. effective Human Resources Management Strategies EFFECTIVE HR MANAGEMENT STRATEGIES 37
  38. 38. EFFECTIVE HR MANAGEMENT STRATEGIES EFFECTIVE HR MANAGEMENT STRATEGIES 38
  39. 39. EFFECTIVE HR MANAGEMENT STRATEGIES EFFECTIVE HR MANAGEMENT STRATEGIES 39
  40. 40. EFFECTIVE HR MANAGEMENT STRATEGIES “...the worst thing that could possibly happen to an enterprise and its employees is the adoption of an ineffective H R Management strategy......” 40
  41. 41. EXAMPLES OF “MIS-MATCH” E2 M2 E1 M1 homework? ..oh, yes!!! understand your organisational strategies 41
  42. 42. SCANNING AN ORGANISATIONAL STRUCTURE area: cultural values • typical of the "technology" era with a strong "Tayloristic” belief • Credo: "...products and/or technology make business..." • Competitiveness = costs reduction • typical of the "marketing" era • Motto: Max exploitation of the Market • Logics: Max yearly results (economic - short/medium term strategy) • Credo: Business is made exploiting opportunities • typical of the "quality challenge" era • Motto: Client's satisfaction ("....client is the king...") • Logics: Long-term strategy based on the Total Quality approach • Credo: Business is made improving continuously and systematically the whole productive process in a "client-driven" mode • typical of the "World-Class" era • Motto: Total Satisfaction (client, employees, shareholders, suppliers.....) • Logics: Long-term strategy based on the VAM (Value Adding Management) philosophy (and the "value-chain" concept of M. E. Porter: "..be in the right chain with valid/competitive partners..") • Credo: Business is made by increasing continuously and systematically the overall value of the vendor-vendee system and by consistent innovation 42
  43. 43. SCANNING AN ORGANISATIONAL STRUCTURE area: relationship with market • Market: unsaturated (demand > offer) and "stable" • Market's needs: established by "technologists", who decide on validity and "value" of products • Products are literally "thrown" into the market (PRODUCT-OUT) • Market: saturated (offer > demand) - “consumer” - not "mature" - somewhat unstable - fierce Competition • Marketing force/abilities indispensable to locate opportunities and generate new needs in the market • Sales force/abilities indispensable to enhance competitiveness • Products developed (functional specs ---> technical specs ---> industrial/manufacturing specs) by locating market needs (PRODUCT-IN) • Market: saturated (offer > demand) - somewhat less “consumer” - "mature" (capable of understanding and rewarding quality) - unstable/turbulent •Market's needs: already established (by western industries) - product lines are well defined (cars, consumer electronics.....) •Extensive use of QFD (Quality Function Deployment) techniques for effective/fast product development •Market sets productive parameters (quality, delivery, cost) - "...the ocean pulls the river..." • Market: rich (opulent) - very mature - featuring complexity and economic turbulence - very high competition - rapidly changing • Market's needs: extremely personalised (mass-production coma ?) • Extrapolation/exasperation of the "market sets productive parameters" concept -----> "market sets business parameters" SCANNING AN ORGANISATIONAL STRUCTURE area: relationship with clients • Client is an “entity” that buys our products (and sometimes gives us a lot of hassles...) • We do not know much about our Clients (we are mainly concerned with their “liquidity”...) • Client can and must be known more/well • Client can be persuaded to buy our products - we have marketing and sales dept./s that take care of that..... • Client is “King” and Client’s satisfaction is top priority • Client’s needs and expectations (explicit and implied) must be fulfilled • Exasperation of the “Client is King” concept --- > “..Client is our Partner in business....” 43
  44. 44. SCANNING AN ORGANISATIONAL STRUCTURE area: organisation & management • "Mechanical" (Scientific) system • Organisation structured in great details, and generally "static" • Decision-making process: top-down • Max attention to efficiency • Professionalism: specialised ("technical" positions are the most essential and rewarded) • Work: fragmented • Management: specialised, "per function", bureaucratic • Budget = basic tool. Great attention to "real/estimated" comparisons/analysis and to "deltas" • Max control (inspection, supervision) • Max cost control (per "cost centre") • "Mechanical" (Scientific) system • Organisation structured in great details, but somewhat dynamic • Same organisational principles as in model (A), with new, predominant functions (Sales, Marketing), and a new predominant position: the "Controller" • Decision-making process: top-down • Inter-functional management (featuring meetings, committees, inter-functional project teams....) • MBO - Management by Objectives • Very sophisticated budgeting/control system (with EDP/IT aid) SCANNING AN ORGANISATIONAL STRUCTURE area: organisation & management • "Organic" system • From "product" culture (models A and B) to "process" culture and organisation • "Macro" organisation, process-related to main productive parameters: quality - delivery – cost • "Micro" organisation, also process-related to all other parameters • Decentralisation of responsibilities, authorities and management activities • Multi-skilled and multi-function management ("entrepreneurial" management) • Decision-making process: rather bottom-up • Profit-centres rather than cost-centres • Cost control system: from standard-oriented (models A + B) -----> to target-oriented (with performance indicators) (Model C) • Kaizen (continuous & systematic process improvement). From "Static" standards (models A + B) -----> to "dynamic" standards (model C). High employees involvement • Flat Hierarchy (Horizontal Organisation) • Business/entrepreneurial culture and organisation • Total decentralisation of responsibilities in respect of overall results – extensive Process Re-Engineering • Organic system featuring high level of internal "supplier/client" relationship - "inter-function" and "matrix“ type organisational structures with high flexibility - value-adding “(re-)engineered” processes • Profit centres (ABA - Activity Based Accounting) • VENTURE = entrepreneurial management (global management + risk management), highly market-oriented (in real time), with "intra-preneurial" examples • From MBO (Management by Objectives) -----> to MBP (Management by Policies) • Extensive bottom-up drive • Top management function: co-ordination - homogenisation - internal consultancy/coaching 44
  45. 45. SCANNING AN ORGANISATIONAL STRUCTURE area: relationship with employees • Man = productive resource executing planned activities • Max control (inspection, supervision) • Employees are generally performing a series of simple and/or well defined tasks • New parameters at shop-floor level: job rotation, job enlargement, job enrichment • MBO - Management by Objectives • Tasks performed according to well structured “job descriptions” • Decentralisation of responsibilities and authorities up to shop floor level - some form of “empowerment” (total delegation of responsibilities and max autonomy within own scope of work) • Considerable/high employee involvement at all levels (in problem solving, decision making, and improvement activities in general) • Extensive bottom-up drive (both in decision-making and in design/change of organisational parameters) • Empowerment and beyond: “....employees are partners in business...” - considerable entrepreneurial and “intra-preneurial” phenomena within the Organisation – result-based merit-o-cratic system, with examples of profit-sharing and share-holding type of rewards for employees SCANNING AN ORGANISATIONAL STRUCTURE area: manufacturing and operational strategy • Max productive volumes (limited only by financial constraints) • Max productive efficiency with high attention to costs • Investments: ----> Improvements of organisation and technology ----> R & D (product and technology) • "Make" rather than "buy" • Linked to the logics of max turnover and max profit • Short/medium term strategies driven by market researches • Product diversification • Fragmentation into business units (divisions, product lines.....) • Tendency to commercialisation "only" • Linked to the logics of "turnover consolidation & strengthening" (large volumes- lower costs-larger volumes) • Driving philosophies: CWQC (Company-Wide-Quality-Control) – TQM (Total Quality Management) – TP (Total Productivity: JIT – Process Improvement & Management) - TPM (Total Productive Maintenance) • Pilot tool: SEW (Systematic Elimination of Waste) • Considerable/high decentralisation of production (and responsibilities associated with design, if applicable, and production) and high "integration" with suppliers • Internal client = external client • Linked to the logics of "profit in the medium-long term" maintaining and developing the enterprise's overall value • Protagonist: TBI (Total Business integration) [GWQC (Group-Wide-Quality-Control) - TP (Total Productivity) and all LEAN approaches/disciplines – Value Stream Management - TPM (Total Productive Maintenance) – 6 Sigma Methodologies - PPD (Product-Process Development), with QFD (Quality Function Deployment) - CIM (Computer Integrated Manufacturing) - SEW (Systematic Elimination of Waste) (Group-wide) - TEI (Total Employee Involvement) (Group-wide) and TEP - COMAKERSHIP] • Emphasis on total flexibility and extreme attention to all lead-times: time-to-market (development - engineering) - start-up time - P-time - set-up time - distribution time - information time ........ with vendors as co-protagonists 45
  46. 46. SCANNING AN ORGANISATIONAL STRUCTURE area: procurement & relationship with suppliers • Buy at the lowest possible price (utilising high contractual power) • "Paternalistic" style of relationship with ("subordinate") suppliers • Considerable decentralisation (buy rather than make: to cope with market demand and peaks, differentiated in volumes and mix) • Alternative, competing suppliers (in order to achieve cost efficiency and to cope with demand peaks) - suppliers "in parallel" • Generation of high competitiveness among suppliers • Max exploitation of suppliers -----> "disposable" suppliers - turnover of suppliers • Extensive decentralisation of production (make produce rather than make) and associated (global) responsibilities • Creation of own, long-term suppliers network [suppliers: limited in number, well selected, "dedicated", "married", highly involved in the improvement of common processes, ideally on the same level of professionalism and maturity] - Motto: "let's improve together" • Vendor-Vendee relationship are seen as a starting point (rather than as a target) • Driving philosophies: Value-chain - GWQC – Comakership • Permanent logistic networks integrating vendors and vendees • Few, selected, reliable, integrated suppliers - high degree of reciprocal trust - joint improvement programs – "open" enterprises WORLD-CLASS PERFORMANCE the lean enterprise makes no distinction between external and internal clients 46
  47. 47. WORLD-CLASSPERFORMANCE WORLD-CLASS PERFORMANCE the lean enterprise operates “per process” 47
  48. 48. UNDERSTANDING PROCESSES CENTRAL PROCESS articulated in various Primary Processes (MONEY GENERATING PROCESS) CRITICAL PROCESSES Examples: (PRIMARY PROCESSES) Marketing process - Sales process - Orders Processes that "touch" the customers and are receiving process - Customer Relations addressed to satisfy the 1st Supporting Group process - Product Design process - (Clients…) Production process - Despatch process - Billing process - etc. SECONDARY PROCESSES Examples: (SUPPORT PROCESSES) SUPPORT Procurement process - Production Planning support the Central (money generation) process OR are process - Personnel Recruitment process - set to “learn” or research in specific fields R&D process – etc. OTHER PROCESSES Examples: invisible to customers, but essential for Organisation's Administration process - Accounting functioning and addressed to the satisfaction of other process - Health & Safety Management Supporting Groups (Owners & Shareholders – process - etc. Employees – Suppliers – Regulating Bodies like Government, Bureau of Standards, Normalisation Bodies….) PROCESS ENGINEERING 48
  49. 49. TODAY'S ULTIMATE SECRET FOR LEAN PERFORMANCE, EXCELLENCE AND COMPETITIVENESS: FLOW PROCESS FLOW PROCESS the “overall” process must be flowing and waste-less not only “internally” (operation side) but internally also “externally” (client side) externally Example 1 Examples 2 49
  50. 50. FLOW PROCESS Main features Value delivering, dynamic, flexible, Flow Processes (with natural sequences) built around clients‘ expectations and needs, and with diversified routes accordingly Multi-function and multi-skill personnel Multi- multi- (case worker - case team) Responsibility for the process and its output FLOW PROCESS Main features Decision making autonomy within the process --- > Empowerment Reduction/elimination of supervision and control One process owner as reference point 50
  51. 51. FLOW PROCESS Main features Management: from supervision to coaching (training and support) Flattening of organisational structures Max (intelligent) exploitation of technology FLOW PROCESS THE SECOND INDUSTRIAL REVOLUTION from to internal attention attention to client attention to task attention to process simple tasks simple processes function units process units 51
  52. 52. LPM Lean Project Mangmt 52
  53. 53. FP Flow Process VAM VALUE ADDING MANAGEMENT 53
  54. 54. the VAM approach to the productive process process time analysis FRIGHTENING……. Source: Lean Thinking (James Womack + Daniel Jones) Σ Time = 319 days Processing = 3 Hrs (0,04%) 54
  55. 55. SEW SYSTEMATIC ELIMINATION OF WASTE VALUE! 55
  56. 56. 56
  57. 57. SUMMARY OF THE MAIN TYPES OF WASTE Overproduction Stock Un-needed processing steps Motion Control Defects Waiting/idling Transportation 57
  58. 58. WASTE – THE TABLE OF EXCUSES - OLD 1) That's the way we have always done it 2) I didn't know you were in a hurry for it 3) That's not in my department 4) No one told me to go ahead 5) I am waiting for an OK 6) That's his job - not mine 7) Wait till the boss comes back & ask him 8) I forgot 9) I didn't think it was very important 10) I'm so busy I just can't get around to it 11) I thought I told you 12) I wasn't hired to do that WASTE – THE TABLE OF EXCUSES - NEW 1) That's the way we have always done it 2) There is no better way, believe me…. me… 3) This way we know it works…. works… 4) Why change? We are already so busy…. busy… 5) We have tried in the past, and it didn’t work… didn’ work… 6) Managers and consultants…. Only able to mess us up consultants… 7) You mean we are stupid the way we do it??? 8) Impossible 9) We need stock: it’s a good investment it’ 10) Set-up time cannot be reduced further…. Set- further… 11) We must control quality or clients will complain 12) All machines eventually give problems 58
  59. 59. spot the waste! LEAN MANUFACTURING and FLOW PRODUCTION continuous flow the target: pipeline flow 59
  60. 60. Lean Manufacturing uses less of everything compared with mass production: half the human effort in the factory, half the manufacturing floor space, half the investment in tools, half the engineering hours to develop a new product in half the time. Also it requires keeping far less than half the needed inventory and results in fewer defects….. James P Womack – Daniel T Jones – Daniel Roos (The machine that changed the world) LOT (BATCH) PRODUCTION VS. FLOW PRODUCTION 60
  61. 61. LOT PRODUCTION VS. FLOW PRODUCTION 61
  62. 62. LOT PRODUCTION VS. FLOW PRODUCTION LOT PRODUCTION VS. FLOW PRODUCTION 62
  63. 63. LOT PRODUCTION VS. FLOW PRODUCTION LOT PRODUCTION VS. FLOW PRODUCTION 63
  64. 64. fake flow production the “conveyor” method LOT PRODUCTION VS. FLOW PRODUCTION 64
  65. 65. “batch production” vs. “one-piece flow” batch production vs. one-piece flow ANALYSIS analysis 65
  66. 66. The role of Lean Disciplines in developing Employee Involvement The role of Lean Disciplines in developing Employee Involvement 66
  67. 67. the “SOCO” (5S) approach non-soco examples 67
  68. 68. a soco story a soco factory 5S in action a soco factory 5S in action 68
  69. 69. U-CELL MANUFACTURING ONE-PIECE FLOW cell manufacturing labour/machines situation 69
  70. 70. Lean Manufacturing and Total Quality Management THE POKA-YOKE DISCIPLINE POKA- 100% TESTING APPROACHES THE 6 SIGMA METHODOLOGY 70
  71. 71. TOTAL QUALITY MANAGEMENT APPROACHES TO TQM TOTAL QUALITY MANAGEMENT implementing a Quality Assurance or Total Quality Program without considering the Productivity aspect would be "handicapped" 71
  72. 72. FLOW PRODUCTION - THE QUALITY ISSUE The 5 QA Achievement Levels 1) Defective product is delivered to client 2) Defective product is not delivered to client 3) Defects are reduced 4) Processes do not send defects downstream 5) Processes do not create defects to begin with FLOW PRODUCTION - THE QUALITY ISSUE Flow Production is based on QA level 5: ZERO DEFECTS 72
  73. 73. FLOW PRODUCTION - THE QUALITY ISSUE Quality Inspection built-into the built- productive process: 100% inspection Poka-Yoke devices built-into the Poka- built- productive process for guaranteed quality If defects occur, the process is stopped, and the cause/s found and eliminated No double check/double inspection Inspection Department IS the Production Department 6 Sigma methodology in extreme or well suited situations Flash Images of fully automated and semi-automated calibrating and testing lines for the “Common Rail” Diesel Injection System. Lines engineered by AEA Srl of Italy. 100% testing 73
  74. 74. 100% testing a world-class enterprise dedicated to 100% quality testing The 6-Sigma 6-Sigma Methodology overview 74
  75. 75. poka-yoke 75
  76. 76. MISTAKE-PROOFING IN EVERYDAY’S LIFE MISTAKE- EVERYDAY’ MISTAKE-PROOFING IN EVERYDAY’S LIFE MISTAKE- EVERYDAY’ 76
  77. 77. MISTAKE-PROOFING IN EVERYDAY’S LIFE MISTAKE- EVERYDAY’ POKA-YOKE APPLICATIONS POKA- 77
  78. 78. POKA-YOKE APPLICATIONS POKA- FLOW PRODUCTION - THE QUALITY ISSUE The “turn-this-board” strategy 78
  79. 79. FLOW PRODUCTION - THE QUALITY ISSUE The “turn-this-board” strategy HEAVY MECHANISATION / AUTOMATION LEAN MANUFACTURING and TPM TOTAL PRODUCTIVE MAINTENANCE 79
  80. 80. 80
  81. 81. “traditional” TPM definition PARTICIPATIVE PROGRAMS DESIGNED TO INCREASE EQUIPMENT EFFECTIVENESS (PRODUCTIVITY - QUALITY - SAFETY) AIMING AT VARIOUS GOALS: ELIMINATION OF THE 6 BIG LOSSES, IN ORDER TO LOSSES MAXIMISE EQUIPMENT EFFECTIVENESS RESTORATION OF EQUIPMENT TO OPTIMAL OPERATING CONDITIONS ELIMINATION OF ACCELERATED DETERIORATION AUTONOMOUS MAINTENANCE ACTIVITIES TO MAINTAIN BASIC EQUIPMENT CONDITIONS “traditional” TPM goals INCREASE IN EFFICIENCY AND COST-EFFECTIVENESS OF MAINTENANCE FUNCTION MAINTAINABILITY IMPROVEMENT AND DEVELOPMENT OF A MAINTENANCE SYSTEM FOR THE EQUIPMENT LIFE MAINTENANCE PREVENTION INCREASE OF OPERATION AND MAINTENANCE SKILLS 81
  82. 82. “traditional” TPM goals TOTAL INVOLVEMENT OF PEOPLE FROM ALL DEPTS. THAT PLAN, DESIGN, USE OR MAINTAIN EQUIPMENT INVOLVEMENT OF TOP MANAGEMENT MAX. SAFETY AND ENVIRONMENT CONSERVATION/ /POLLUTION CONTROL AND OTHERS “today’s” TPM today’s TPM focuses on the entire productive process to assure that the right equipment is part of a value- adding/waste-free series of operations and to assure (by deploying “traditional” TPM approaches) that equipment contributes “effectively” to the primary objective of value-generation 82
  83. 83. spot the waste! people and machines 83
  84. 84. THE 6 BIG LOSSES 84
  85. 85. THE 6 BIG LOSSES THE 6 BIG LOSSES 85
  86. 86. PREVENTIVE MAINTENANCE AUTONOMOUS MAINTENANCE the hearts of TPM The new relationship between Maintenance and Production VALUE STREAM MANAGEMENT 86
  87. 87. VALUE STREAM MANAGEMENT VSM storyboard PROCESS MAPPING 87
  88. 88. PROCESS MAPPING PROCESS MAPPING PROCESS ROUTE ANALYSIS GROUP-TECHNOLOGY GROUP- 88
  89. 89. PROCESS MAPPING PROCESS ROUTE ANALYSIS GROUP-TECHNOLOGY GROUP- PROCESS MAPPING PROCESS ROUTE ANALYSIS GROUP-TECHNOLOGY GROUP- 89
  90. 90. PROCESS MAPPING PROCESS ROUTE ANALYSIS GROUP-TECHNOLOGY GROUP- TACKLING IMPROVEMENT KAIZEN STYLE 1. Double-check your “direction” 2. Understand improvement!!! 3. Rank Improvement Projects! Create a Kaizen Milestones Charter and manage it with the typical Project Management style 90
  91. 91. FROM A TRADITIONAL IMPROVEMENTS LIST…. ..TO THE MILESTONE CHARTER 91
  92. 92. LEAN THINKING what is it? The key to WCP: LEAN THINKING LEAN THINKING: what is it? Based on 5 core concepts: 1. Value: as defined and/or perceivable by Value: the customer (what the customers buy) 2. Value Stream: the way value is produced Stream: and delivered 3. Flow: the required value-adding steps Flow: value- must “flow” – the process must flow both flow” “internally” (Operation Side) and internally” “externally” (Customer Side) externally” 92
  93. 93. The key to WCP: LEAN THINKING LEAN THINKING: what is it? Based on 5 core concepts: 4. Pull: or making the value stream “flow” Pull: flow” “pulled” by the market (triggering flow pulled” from the customer needs) 5. Excellence: there is no end to the process Excellence: of minimising time, efforts, space, costs and mistakes while offering a product or service which is closer and closer to what customers actually want, need, expect or dream of…. of… The key to WCP: LEAN THINKING LEAN THINKING: what is it? Definitions: Value-adding activity: any activity that Value- activity: contributes directly to satisfy the needs of the customers Examples: Airline: actual flying Healthcare: receiving diagnosis/treatment Non-value-adding: anything that takes time or Non- value- adding: resources but does not contribute directly to satisfy the needs of the customers Examples: Airline: lining-up to check-in – security check-in lining- check- check- Healthcare: sitting in the waiting room waiting for an appointment appointment Other examples: checking, asking, fixing, second and third contacts, re-doing…. contacts, re-doing… 93
  94. 94. The key to WCP: LEAN THINKING LEAN THINKING: what is it? Very preliminary targets: Reduce the steps by half Reduce the time by half Reduce the errors by half Subsequent targets: Cut the steps to VA only Cut the time to VA-Time Zero defects Flow Processing in any Industry EXERCISE??? …..oh, yes!!! scrap-yard operations - 1 scrap- 94
  95. 95. The key to WCP: LEAN THINKING LEAN THINKING: resistance RESISTANCE TO LEAN TRANSITION It will feel wrong… taking apart something that has taken years to build… Opposition thinking: thinking: Batch vs. one piece flow mentality Fight fires vs. “ask why 5 times” times” Push vs. pull (anticipate) mindset LEAN THINKING: resistance the “conveyor” mentality 95
  96. 96. the “conveyor” mentality LEAN THINKING – who cares? Worker/employee: “…why should I Worker/employee: “…why care?” care?” Supervisors/foremen: “…we have Supervisors/foremen: “…we always done this way…” way…” Manager: “…with this work-force, Manager: “…with work- what do you expect?” expect?” Top Management: “…if the results Management: “…if ($) are there, why care?” care?” Smith’s circle is closed! 96
  97. 97. The key to WCP: LEAN THINKING LEAN THINKING: the tools Some of the tools for seeing waste: and: 5W2H Production Control Board 5WHYs Spaghetti diagram TRIZ Value Stream Mapping SOCO (5S) Time Observation Takt Time Bar Charts Flow chart Communication circle LEAN THINKING: the tools 5W2H WHAT? WHY? amplify WHERE? WHEN? WHO? HOW? HOW MUCH? 97
  98. 98. LEAN THINKING: the tools 5WHYs WHY? WHY? WHY? WHY? WHY? SPAGHETTI DIAGRAM – PRESENT STATUS telephone motion/persons motion/goods motion/paper/fax LEAN THINKING: the tools Spaghetti diagram 98
  99. 99. LEAN THINKING: the tools Communication Circles issue John Supplier Bill Mary George LEAN THINKING: the tools Takt Time TOTAL AVAILABLE WORK TIME TAKT TIME = CUSTOMER DEMAND Takt Time sets the pace of production to match the rate of customer demand Example: TAKT TIME in Healthcare If your customer demand is for 24 x-rays/day and your x-ray tech is available 420 minutes per day Takt time: 420 ÷ 24 = 17,5 minutes 99
  100. 100. LEAN THINKING: the tools Time Observation With Time Observations you determine “how long” it takes long” to do the task Time Observations are NOT “Time Studies” (Time & Studies” Motion…..) Motion… Time Observation is a tool to help you “see” waste, by see” seeing the non-value-adding steps in detail non- value- Get close to the work Video record See in detail See the waste Quantify waste Classify waste LEAN THINKING: the tools Bar Chart Displays Time Observation data 1) for activities performed by an individual person TARGET 100
  101. 101. LEAN THINKING: the tools Bar Chart Displays Time Observation data 1) for activities performed by several persons ? How many people do you need? LEAN THINKING: the tools The main tool: The main Lean Thinking tool and the common denominator to all other tools… 101
  102. 102. YEARS 2000 FACTORS OF COMPETITIVENESS Creativity the 6 thinking hats 102
  103. 103. Flow Processing in any Industry EXERCISE??? …..oh, yes!!! scrap-yard operations 2 – scrap cans scrap- scrap-yard operations 2 – scrap cans 103
  104. 104. …are Lean Thinking and Flow Process principles and techniques suited to all industries? The answer is always: yes!! 104
  105. 105. Lean Thinking in the Service Industry Flow Processing spot the waste! Service Industry A GLORIOUS WEDDING CONVENTIONS A FISHY EVENING 105
  106. 106. look at the pearls! (Service Industry) The “pearls” in the Service Industry drop your comments… comments… to the floor! 106
  107. 107. Flow Processing in the Service Industry The Service Industry offers numerous examples of good, Flowing Processes and bad, non-Flowing Processes…….. non- Processes…….. EXAMPLES Flow Processing in the Service Industry EXERCISE??? …..oh, yes!!! POKA-YOKE FLOW PROCESSING POKA- 107
  108. 108. IDEAMATRIX features, characteristics…. go here characteristics… P R O V O C A T I O N idea W O R D S Flow Processing in the Service Industry Sometimes it’s difficult to do things right the first time, without mistakes: there can be problems…. it’ problems… (hotel room not ready…. lost suitcase….) The challenge: what is important is the “Service Recovery Process” (there is only one more chance to get things right!!) Process” the SR Process must be: top priority - extremely fast - lean - and simple…. simple… The SRP intervention must care of the customer first and then of his/her problem Frontline Personnel empowerment: essential! empowerment: Target: transform a dissatisfied client into a (very) satisfied one! 108
  109. 109. Flow Processing in the Service Industry EXERCISE??? …..oh, yes!!! BRA-FITTING Deploying VSM and other LT tools in other Industries/Processes a) healthcare 109
  110. 110. Deploying VSM and other LT tools in other Industries/Processes b) administration COMPLEX PROCESSES, INVOLVING SEVERAL PERSONS or DEPARTMENTS, OFTEN ORIGINATE ERRORS EXERCISE???? …oh, yes!!!! a hiccup process… process… 110
  111. 111. Lean Thinking in the Project Industry Lean Project Management Lean Construction Management TRADITIONAL PROJECT MANAGEMENT basics 111
  112. 112. TRADITIONAL PROJECT MANAGEMENT TRADITIONAL PROJECT MANAGEMENT PROJECT PARAMETERS 112
  113. 113. TRADITIONAL PROJECT MANAGEMENT key principles TRADITIONAL PROJECT MANAGEMENT key principles 113
  114. 114. the need… Typical symptoms of Projects with low PROJECT MANAGEMENT content Project Start : slow, hesitant, difficult Delays on completion Project Termination : long, painful, with hiccups Penalties Costs : too high, and anyhow exceeding budget Personnel turnover within Project Team Efforts : duplicated/doubled up 114
  115. 115. Typical symptoms of Projects with low PROJECT MANAGEMENT content Inefficient resources utilisation Waste - Rejects and Defects Stress, pressure, anxiety, ineffectiveness, inadequacy, lack of readiness to take up responsibilities, lack of flexibility, frequent misunderstandings, tendency to "pass the buck", de-motivation, rigidity........... de- High level of contingencies – unforeseen and unexpected occurrences Time factor and Quality standards not complied with by suppliers and sub-contractors sub- Dissatisfaction : of Client - of Consultants - within Project Team – within General Management Likely causes: Projects not dealt with as such Non realistic estimation/budgeting No person responsible for the project as a whole : no Project Manager (or too many...) Project Manager lacking knowledge of his role and functions General Management and/or Functional Managers lacking knowledge of Project Manager's role Wrong person acting as Project Manager Inadequate Communication Project Manager lacking human resources managing abilities Project Team not adequately structured by Project Manager Project's objective(s) not sufficiently defined/clarified objective(s) 115
  116. 116. Likely causes: Project Manager lacking strategic abilities Excessive conflicts - PM lacking conflicts management abilities Project Manager autonomy too limited/non adequate Project Manager lacking administrative capacity Non integrated PLANNING and CONTROL Non realistic Planning and/or Scheduling Non adequate Project Cost Control System Human resources under excessive stress Too many and too sudden changes of any nature Project Manager lacking commercial abilities Project Manager lacking negotiation abilities 116
  117. 117. 117
  118. 118. conventional management… …and matrix management 118
  119. 119. never start a project unless all resources are available…. available… 119
  120. 120. PLANNING PROGRAMMING SCHEDULING CONTROLLING 120
  121. 121. LIFECYCLE OF PROJECT WITH POOR PLANNING Project initiation Wild enthusiasm Disillusionment Wild chaos Search for the guilty Punishment of the innocent Promotion of non-participants non- Definition of the requirements (Planning) EXERCISE???? …oh, yes!!!! the OWP TUBES project 121
  122. 122. THE BOTTOM LINE… Calculation Sheet introducing: LEAN PROJECT MANAGEMENT basics 122
  123. 123. Lean Project Management foreword LEAN PROJECT MANAGEMENT foreword WHY DO SOME PROJECTS FAIL? 123
  124. 124. LEAN PROJECT MANAGEMENT “the project/construction industry is in some ways not completely shifted from craft to mass production - much less to lean production” on the other hand, the industry has followed the mass production model in its extensive division of labour LEAN PROJECT MANAGEMENT the main consequences: WASTE COST OVERRUNS DELAYS ON SCHEDULES the 3 phenomena are strictly interlinked and have a common denominator: an inadequate style of thinking 124
  125. 125. spot the waste! Construction Industry 1 EXAMPLES spot the waste! Construction Industry 2 EXAMPLES 125
  126. 126. any correlation between what you have seen and your work of every day? every Any similitude? Check list: Meetings – “spot” meetings in the passage… spot” passage… Moving Giving instructions – Receiving instructions Filing Doing things “in case” – or “why not?” case” not?” Ordering things – Setting-up things – Making sure.. Setting- Answering Checking – Inspecting - Supervising Attending… Attending… Talking – Clarifying – Explaining – Illustrating… Illustrating… Chatting - Phoning – Taking “this” call… this” call… Reporting Putting pressure – Chasing - Expediting – Dealing… Dealing… Preparing Managing – Authorising, approving – Getting right… right… Waiting Does all this create Observing value for your clients? LEAN PROJECT MANAGEMENT Traditionally, project/construction works are viewed and modelled only as a series of conversion (value-adding) (value- activities (activity/conversion-centred or contract- (activity/conversion- contract- centred model) For example, waste activities such as waiting, offloading, storing, moving material, and inspection are not generally modelled by Critical Path Models (CPM), WBS (Works Breakdown Structure) or other planning or control tools. 126
  127. 127. LEAN PROJECT MANAGEMENT analysis of traditional planning inadequacies In project/construction works, the effective point of intervention has proven to be the Weekly Work Plan, Plan, because that is where decisions are made, work is selected and scheduled and commitments are made. LEAN PROJECT MANAGEMENT analysis of traditional planning inadequacies Generally and traditionally, a bar chart is produced showing the durations and sequencing of assignments by sub-crew for sub- each day of the week. The bar-chart is often bar- literally “thrown” at supervisors/foremen. thrown” however, having such a bar chart on hand and using it effectively may be two very different things… 127
  128. 128. LEAN PROJECT MANAGEMENT analysis of traditional planning inadequacies Planning (schedules, budgets, etc.) collectively tell project personnel what they SHOULD do. Project Management thereafter monitors and enforces conformance of DID to SHOULD. SHOULD. Planning takes place before project execution. Control takes place during/after project execution. Scheme: project objectives PM Control data information planning the work SHOULD resources executing the plan DID LEAN PROJECT MANAGEMENT traditional planning Everything works fine until “something” goes wrong - then a something” chain reaction takes place ---- > delays over delays Then, more and more pressure is put on everyone in the chain to produce more, faster This usually makes things worse rather than better Working under pressure results in ever more non-productive non- time, de-moralises supervision, and directs energy and de- attention toward “fire fighting” rather than learning fighting” how to work well in the first instance If this traditional approach to planning worked perfectly, DID would always match SHOULD Statistics reveal that what actually gets done differs from what is supposed to be done at least 1/3 of the time 128
  129. 129. LEAN PROJECT MANAGEMENT taking the lean way taking the lean way LEAN PROJECT MANAGEMENT the lean philosophy views Engineering & Construction Projects as fast, continuous Flow Processes, in which only conversions add value 129
  130. 130. LEAN PROJECT MANAGEMENT Based on the same 5 Core Principles as Lean Thinking: 1.Value 2.Value Stream 3.Flow 4.Pull 5.Excellence specific tools/techniques for: LEAN PROJECT MANAGEMENT the PPC and its intelligent use the “Last Planner” approach 130
  131. 131. LEAN PROJECT MANAGEMENT lean planning and the “last planner” planner” THE LAST PLANNER: Should-Can-Will SHOULD Last Planner CAN (waste removal) WILL Last Planners are expected to make commitments (WILL) to doing what SHOULD be done, only to the WILL) extent that it CAN be done in a lean fashion LEAN PROJECT MANAGEMENT lean planning and the “last planner” planner” the LAST PLANNER mechanism waste reduction/elimination from PU work package or activity hence: REALISTIC LOADING of PU resources constraints & unforeseen/s elimination hence: SOUND ASSIGNMENT CAN BE DONE WILL BE DONE 131
  132. 132. LEAN PROJECT MANAGEMENT project objectives lean planning and lean control data initial planning SHOULD information Match: SHOULD to ADJ. SHOULD PM Control status + ADJUSTED Match: adjusted planning SHOULD forecasts ADJ. SHOULD to WILL CAN last planner WILL Match: WILL to DID (PPC) resources work execution DID LEAN PROJECT MANAGEMENT lean planning and lean control PPC is the heart of Lean Planning/Control the lean method consists in systematic measuring identifying reasons for non-completion (5Why) non- (5Why) and tracing reasons back to root causes that can be eliminated to prevent repetitions Measuring PPC allows also to distinguish between failures rooted in plan quality and failures to execute plans Traditionally, we assume that all failures are execution failures, whereas the vast majority of failures to complete planned work are rooted in the quality of plans. 132
  133. 133. LEAN PROJECT MANAGEMENT who is the “Last Planner”? ideally…. everybody! Lean Project Management in Multi-Project situations the TOC approach 133
  134. 134. THE BI-TUBE PROJECT ANALYSIS can construction become different? look at this!! 134
  135. 135. LEAN THINKING AND TECHNOLOGY LEAN THINKING AND TECHNOLOGY Remember! In a lean environment: 1st – People 2nd – Methods (lean) 3rd - Technology 135
  136. 136. LEAN THINKING AND TECHNOLOGY technology cul-de-sac technology cul-de-sac 136
  137. 137. LEAN THINKING PRINCIPLES IN OTHER PROJECT-DRIVEN INDUSTRIES Spot the Waste! Steel Fabrication EXAMPLES 137
  138. 138. LEAN THINKING AND SAFETY non-lean safety examples 138
  139. 139. LEAN THINKING AND THE CONTINUOUS PROCESS INDUSTRY LEAN THINKING AND THE CONTINUOUS PROCESS INDUSTRY Targets: a) balance the Flow: through Continuous Flow techniques b) pull the Flow: relate Operations to the Market Flow: c) assure the Flow: through TPM & other technical Flow: Maintenance disciplines 139
  140. 140. LEAN THINKING AND THE CONTINUOUS PROCESS INDUSTRY Additional Target: eliminate the residual waste around the Flow The Control Room syndrome EXAMPLES 140
  141. 141. Lean Thinking and the Value Chain Lean Thinking and the Value Chain key issues How can things be ly s ide structured so that the u pp s enterprise does nothing s id e a nd but add value, and does d em that as rapidly as possible? all the intermediate steps, all the intermediate time and all the intermediate people are eliminated all that’s left are the time, the people and the activities that add value for the customer 141
  142. 142. RELATIONSHIP WITH SUPPLIERS IN A WORLD-CLASS ENVIRONMENT s id e pl y su p 142
  143. 143. VENDORS CLASSIFICATION IV CLASS - "NORMAL" III CLASS - "PERFORMING" SUPPLIER II CLASS - "INTEGRATED" I CLASS - "PARTNER" SUPPLIER SUPPLIER (Operational Comakership) SUPPLIER (Business Comakership) CONVENTIONAL APPROACH "IMPROVEMENT" APPROACH OPERATIONAL INTEGRATION STRATEGIC INTEGRATION RELATIONSHIP ° Negotiation focused on price ° Primary attention to quality/price ratio ° Great attention to "total" process ° Great attention to common DEVELOPMENT ° Minimal infos & quality specs ° Large infos ° Long-term relationship regularly (+- yearly) business ° Conflictual interests ° More reciprocal trust reviewed ° Open doors, open "value-chain" ° Little reciprocal trust ° Many open orders & extensive purchases ° Open infos (including market's feed-back) and open info system ° Governed by contractual power planning ° High level of trust ° Benchmarking together ° Single-order purchases with little ° Start-up of long-term relationship ° Mutually agreed vendor's "recovery" ° Full trust: vendor thrives on exception ° Reduction of suppliers number (= selection) procedures vendee's business and vendee ° Short-term purchases horizon ° Some experimental comakership ° Price fluctuations allowed with mutually thrives on vendor's support to ° Many suppliers ° Target: vendor's improvement agreed criteria business ° Decentralization of production and ° Systematic (and jointly defined) vendor's ° Top level agreement on policies responsibilities Kaizen programs (price-quality-process) and strategies ° Open orders as a rule ° Proper business partnership ° Consulting/training services to Vendor with some suppliers QUALITY ° Vendor responsible only for ° Extensive certification of vendor's QA ° Extensive auto-certification ° Maintenance of auto- ISSUE conformity to specs system ° Focus on vendor's CWQC system certification ° Systematic acceptance ° Vendor's rating on "absolute" quality ° Quality guaranteed and auto-certified with ° Focus on GWQC Inspections/Tests jointly agreed criteria) ° Co-design of quality specs and ° Max guarantee only on a 100% test ° Start-up of "auto-certification" programs ° Vendor's global responsibility on QFD basis (sampling/AQL techniques ° Vendor responsible for conformity to use consequences of non-conformities ° Free-pass as a rule and free-pass carry high risk) ° Quality improvement programs imposed (product liability) ° Vendor's globally responsible ° Some inspections at source to vendor ° Free-pass with/without bonus for end-user's satisfaction ° Some "formal" certification (2nd ° Mix tests on acceptance/free-pass ° Integrated improvement programs (QA – and 3rd party) of vendor's QA TQM) system ° Buffer stocks: safe/necessary ° Start-up of JIT supplies (mainly Kanban) ° JIT supplies (frequent/small-lots) directly ° Global vendor's integration in LOGISTICS ° Some buffer stocks to productive areas vendee's productive flow – ° No buffer stocks synchro supplies only ° Some synchro-supplies ° Common informatics and planning PRODUCT- ° None/minimal vendor's involvement ° Some vendor's involvement ° Co-engineering & Co-design ° Extensive, joint PPD and QFD PROCESS ° Vendee's imposition of vendor's process ° Some common use of QFD ° Extensive, joint R & D DEVELOPMENT improvement programs ° Some joint R & D investments investments ° Global involvement ° Price ° QA system evaluation/audit ° Global Process capability audit ° Global Vendor's Organization EVALUATION ° Quality: compliance to specs ° Rating based on "absolute" quality ° Evaluation and rating at Total Costs audit & RATING ° Reliability & Performance ° Evaluation/Rating based on Total Costs of ° Evaluation of QA system (2nd party (non-) quality certification) MOTTO "Shop around for the best price" "Let's improve together" "The productive process starts at "Let's make business together" vendor's premises" 143
  144. 144. comakership the present and the future International Lean Supply Chain - example 144
  145. 145. THE CLIENT IS THE ide KEY: d em an ds THE NEW DIMENSION 145
  146. 146. the customer- and market-driven enterprise customer- market- Enterprise committed to provide excellent quality and competitive products and services to satisfy the needs and wants of a well-defined market segment the customer- and market-driven enterprise customer- market- Traditional enterprise Customer-driven enterprise Customer- Measure of • Bottom-line Financial Results • Customers’ satisfaction Performance • Quick return on Investments • Market share • Long-term Profitability • Level of Quality & Productivity (Value) Marketing focus • Seller’s Market • Buyer’s Market • Careless about lost customers (due • Targets at achieving increased Market to poor customers’ satisfaction) Share and long-term financial growth Attitudes toward • Clients are irrational: a pain in the • Customers’ voice is of primary Customers neck importance • Customers: an obstacle to • Professional treatment/attention to Profitability clients • Hostile and careless attitude • Courteous and responsive attitude • “Take it or leave it” attitude • Empathy and respectful attitude Basis for • Product-driven • Customers-driven Decision-making • Management by opinion • Management by facts and data Product and • Short-term focus • Long-term focus Service Planning • Reactionary Management • Projective Management • Planning Process: through • Planning Process: strategically driven by Management by Objectives customers 146
  147. 147. the customer- and market-driven enterprise customer- market- Traditional enterprise Customer-driven enterprise Customer- Quality of • Provided according to Enterprise’s • Provided according to customers’ Product/Services requirements/policy requirements and needs Productive • Targeting at errors and defects • Targeting at errors and defects Process Mangmt. detection prevention Style of • Customers, Suppliers and • Extensive teamwork practice between Operations Operations people have nothing in Process Owners, Suppliers and common Customers Product and • Customers can wait for products and • Fastest time-to-market products and Service Delivery services services Orientation to • People are an infinite source of • People are the enterprise’s greatest Personnel problems and a burden on the resource enterprise Improvement • Crisis Management • Continuous Process Improvement Strategy • Management by fear and intimidation • Conscious Performance Management 147
  148. 148. 148
  149. 149. Lean Thinking is not only concerned with waste elimination from processes… …to the contrary, Lean Thinking is very much concerned with conservation of value and enhancement/increase of value to the customers… …for that, we must focus on…. OPPORTUNITIES AND THREATS OF THE NEW ECONOMY the market is, as always, full of opportunities……. 149
  150. 150. OPPORTUNITIES: 1) OPPORTUNITIES: 2) 150
  151. 151. OPPORTUNITIES: 3) the longest chain EXERCISE???? …oh, yes!!!! spot an opportunity 151
  152. 152. Lean Thinking and the Marketing/Sales Process think like a customer! Lean Thinking applied to the Marketing/Sales Process drill Marketing/Sales = process to “manufacture” customers manufacture” Process output: loyal, profitable, repeat customers the process must include only those activities which are necessary to add value from a customer’s perspective customer’ PUSH vs. PULL example: leads generation (trade shows..) ONE-PIECE FLOW ONE- market research “in batch” --- > batch” continual research on a continual basis CELLULAR MANUFACTURING permanent, X-functional work teams, dedicated to process X- leads, QFD outputs, etc. in one-piece flow mode one- 152
  153. 153. Lean Thinking and Office Work open debate the deployment of TPM principles in other industrial sectors open debate 153
  154. 154. Lean Thinking vs. 6 Sigma LT vs. 6 Sigma 154
  155. 155. LT vs. 6 Sigma: one possible LT solution LT vs. 6 Sigma: one possible LT solution 155
  156. 156. Lean Thinking principles in developing new products/services a slight design mistake 156
  157. 157. WORLD CLASS PRODUCT DEVELOPMENT The main “State-of-the-Art” Disciplines are: State- of- the- Art” QFD (Quality Function Deployment) FMEA (Failure Mode and Effect Analysis) FTA (Fault Tree Analysis) DE (Design of Experiments) MU (Multivariate Analysis) VA (Value Analysis) VE (Value Engineering) CE (Concurrent/Simultaneous Engineering) essential: INTEGRATED APPROACH 157
  158. 158. CONCURRENT ENGINEERING ...another “Terminator” of Adam Smith theories…... 158
  159. 159. Lean Thinking and Software Development Manufacturing wastes translated to software development Overproduction = Extra Features Inventory = Requirements Extra Processing Steps = Extra Steps Motion = Finding Information Defects = Defects Not Caught by Tests Waiting = Waiting, Including Customers Waiting, HOMEWORK??? ..oh, yes!!! 159
  160. 160. “LEAN” STATUS SELF-ASSESSMENT a world-class project-driven enterprise 160
  161. 161. LEAN THINKING THE EXCELLENCE TARGET IMPROVING PERFORMANCE: THE LEAN KAIZEN APPROACH the bottom-up approach to Performance Improvement has a name: bottom- 161
  162. 162. today's KAIZEN systematic and methodical approach, top- top- driven, co-ordinated and supported, co- to continuous improvement towards an "excellent, lean status" target in various organisational and operational areas; in a "step-by-step" fashion; "step- by- and with deep, active involvement of those concerned in each improvement area IMPROVEMENT increase in effectiveness and/or efficiency of processes (all the rest might be spurious, fictitious improvement) through PREVENTIVE ACTIONS CORRECTIVE ACTIONS 162
  163. 163. the piers of Kaizen 163
  164. 164. KAIZEN & TEI .....the person doing the job knows far more than anyone else as to the best way of doing that job, and therefore is the one person best fitted to improve it.... .....if he only knew how.....! 164
  165. 165. KAIZEN IS TEAMWORK!!! vertically horizontally internally externally KAIZEN IS PROBLEM-SOLVING THEORY AND PRACTICE methodologies to approach problems and complexity: K-T method Brainstorming, Lateral Thinking & other Creative P/S techniques Critical Examination & other "global" Problem-Solvers Problem- 165
  166. 166. KAIZEN IS DECISION-MAKING ABILITY AND PRACTICE methodologies to approach the decision-making process: Archer method optimisation methods elimination and evaluation charts decision trial-balance method trial- matrix techniques EXERCISE??? …..oh, yes!!! a marketing problem 166
  167. 167. KAIZEN IS INTELLIGENT USE OF THE OLD & NEW TOOLS FOR LEAN IMPROVEMENT Data Collection Chart, Scatter Diagram, Control Charts Graphs, Histograms, Pareto Diagram, ABC analysis Cause and Effect (Ishikawa) Diagram, Relations Diagram Affinity Diagram, CEDAC, Arrow Diagram, Flow-Charts Flow- Tree (Systematic) Diagram, Matrix Diagrams, P-M P- Analysis FMEA/FMECA Methods Radar (Spider) Charts and all LEAN THINKING tools and techniques KAIZEN IS CULTURAL CHANGE 167
  168. 168. team-work teamwork team- -work does it work? team-work Team-work – the solution? The principle of working in team to tackle Project Teams all sorts of organisational and technical issues has been discovered several decades ago…. Kaizen Teams ago… Improvement Teams Inter-functional Teams Inter- Quality Circles Re-engineering Teams Re- 6 Sigma Teams… Teams… …and Meetings: Board Meetings - Management Meetings: Meetings – Department Meetings – Inter-functional Inter- Meetings – Production Planning Meetings – etc. etc. BUT: 168
  169. 169. Team-work – the solution? ….do you recall at least one BUT: meeting from which you (or someone else) came out un- un- satisfied? or a bit frustrated? or satisfied? frustrated? …not to mention possibly stressed? stressed? annoyed humiliated irritated intimidated confused horrified exhausted terrorised…..??? perturbed angry bored to death Team-work – the solution? Meetings and team-work are not necessarily associated with high involvement and effective improvement nor do represent the sole/best answer to kaizen improvement…… 169
  170. 170. Team-work – does it work? EXERCISE???? …oh, yes !!!! team exercising the nerd Lean Thinking and PEOPLE and: the importance of Top Management commitment in implementing a LT program 170
  171. 171. PEOPLE IN INDUSTRY Engine (train) Drivers Doctors Farmers Fishermen (Hunters) 171
  172. 172. EFFECTIVE HR MANAGEMENT STRATEGIES …if a person at the top is the most important, see what happens if a person at the bottom walks away…. away… 172
  173. 173. HIGH (TOTAL) INVOLVEMENT in a nutshell TEI is everyone in the Organisation deeply involved, using own brain power, in problem-solving, learning, power, problem-solving, , continuous improvement activities, and systematic search for opportunities As people's best motivations come from their own ideas, TEI stimulates people to release, in a ideas, channelled mode, their own creative energy for the benefit of the Customers, the Organisation's and their own HIGH (TOTAL) INVOLVEMENT in a nutshell TEI is a system for organisational and people's change. change. It is a system that improves people's working conditions by their own actions. TEI is a system for direct participation of people to Organisation's success, by letting them take responsibilities. responsibilities. TEI wants people to be responsible for their own motivation and their own improvement: simply by letting them know the score.... score.... 173
  174. 174. HIGH (TOTAL) INVOLVEMENT in a nutshell TEI is a system that stimulates people to become responsible agent for their own security. ….responsible agent for their own security…. the worm 174
  175. 175. HIGH (TOTAL) INVOLVEMENT in a nutshell TEI represents a continuous challenge to people, by letting them set the path to their fulfilment at work, enjoying the very process...... high involvement in manufacturing…. 175
  176. 176. multi-skill, multi-function…. high involvement…. 176
  177. 177. high involvement…. getting highly involved…. 177

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