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Building a Lean Enterprise: Navigating the Common Obstacles to Success
The document outlines a comprehensive approach to building a lean enterprise by identifying common obstacles to success and providing strategies for overcoming them. Key elements include establishing a five-year improvement plan, promoting organization-wide learning, creating a lean steering committee, and fostering a kaizen culture. Emphasis is placed on strong leadership alignment, developing strategic plans tied to business goals, and ensuring continuous engagement and improvement throughout the organization.
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Building a Lean Enterprise: Navigating the Common Obstacles to Success
- 1. Building a LeanEnterprise: Navigating the Common Obstacles to Success May 13, 2010 Company LOGO
- 2. Your Instructor ProvidesLean transformation support to non-manufacturing settings. Co-author, The Kaizen Event Planner: Achieving Rapid Improvement in Office, Service, and Technical Settings Co-Developer, Metrics-Based Process Mapping: An Excel Solution Lean Enterprise Program Instructor University of California, San Diego Karen Martin, Principle, Karen Martin & Associates 2
- 3. You will learn… How to establish a five-year improvement plan. Essential organization-wide learning needs. How to accelerate results via organization-wide 5S/ Visual Management, Standard Work, & Error-Proofing activities. The benefits of establishing a Lean Steering Committee. How to develop a kaizen culture that generates “single hits,” while also achieving home runs and grand slams. How to establish an infrastructure that builds organizational competencies, while generating measurable results. The importance of building a foundation for success even if you’ve been on the Lean journey for years. © 2010 Karen Martin & Associates 3
- 4. Do not underestimatethe degree of learning, patience and resources needed to experience success! © 2010 Karen Martin & Associates 4
- 5. Obstacles to Success Problem:Weak or No Leadership Buy-in; Attempting a Grass-Roots Effort © 2010 Karen Martin & Associates 5
- 6. The Executive Champion(s) ©2010 Karen Martin & Associates 6
- 7. Obstacles to Success Problem:No Sense of Urgency © 2010 Karen Martin & Associates 7
- 8. The Journey Begins Createand communicate a sense of urgency / burning platform “Why should we care?” The delicate balance between motivating and inducing fear Data sells! © 2010 Karen Martin & Associates 8
- 9. Establish a Senseof Urgency Shrinking margins Customer dissatisfaction Shrinking market share Rising costs Increased domestic and/or global competition Desire to absorb growth without adding commensurate staffing Impending acquisition Safety and quality slips Reduced innovation © 2010 Karen Martin & Associates Staff burnout Rising turnover Regulatory pressure / compliance issues Rising litigation Social, economic, environmental, or political pressures Downward performance trends (in speed and/or quality) The unknown 9
- 10. Obstacles to Success Problem:Non-Existent or Unrealistic Strategy © 2010 Karen Martin & Associates 10
- 11. Develop a Strategic ImprovementPlan In many organizations, there is fairly significant disconnect between what they aim to achieve with Lean and the way they go about achieving it. © 2010 Karen Martin & Associates 11
- 12. Five-Year Plan 1. Whereare we now (in terms of performance)? 2. Where do we want to be? 3. What’s it going to take to get there? Expertise / guidance Learning / workforce development Time Resources Strong communication Leadership © 2010 Karen Martin & Associates 12
- 13. Establishing a Strategic ImprovementPlan Tied to business goals / strategic plan How much? How fast? Priorities? Evolution vs. revolution Establish clear goals and objectives. What do you hope to achieve with Lean? Within what time period? What does that future state look like? How does it feel? What is it like to operate in that future state? How will we measure our success? © 2010 Karen Martin & Associates 13
- 14. Achieving Optimal Performance Quality Morale Cost Optimal Performance Safety ©2010 Karen Martin & Associates Delivery 14
- 15. Lean as aprocess design technique Hoist Rig Up Spaghetti Diagram Before Kaizen Blitz Improvements Estimated distance walked during Rig Up = 3095 ft Diagram follows the Floor Hand and does not include moving the A-Frame Rig Up Time = 90 minutes Florida Hospital DeLand Discharge Process - 2A Pilot VAlue Stream Champion: Nancy Clark Future State Value Stream Map 1/26/2010 Customer Demand (2A Only): 8 discharges/day; 55/week; 2,860/year (Takt Time = 26.2 minutes) Patient Relieve nursing from transporting nurse-collected specimens to lab Perform / Improve Med Rec at admission Process Blocks Additional Cerner Training Canopy Green border = Value-Adding Yellow border = Necessary Non-Value-Adding Red border = Unecessary Non-Value Adding Cerner Kaizen Improvement Bursts Implement Discharge Huddles Clear Patient Relieve Nursing of Patient Transportation Case Management %C&A = 99% Create Standard W ork for Entire Process Clear Patient; Create Transfer Packet (if needed) Implement Visual Tracking Enter Order Streamline Attending/Consult Communication Primary Nurse Primary Nurse PT: 1 mins. %C&A = 99% Note: Ongoing 1 mins. Hold Discharge Huddle Enter DC Info (Depart I) Case Mgr & Charge Nurse Primary Nurse PT: 15 mins. %C&A = 90% 15 mins. PT: 10 mins. %C&A = 90% 10 mins. Before: 3,095 feet walked Transport Patient Error-Proof Disposition Codes HUC PT: 1 mins. %C&A = 99% Write Order; Complete Paper Med Rec Phy sician PT: 30 mins. %C&A = 80% 30 mins. © 2010 Karen Martin & Associates Perform Med Rec; Print DC Packet Primary Nurse PT: 20 mins. LT: 40 mins. %C&A = 50% 40 mins. 20 mins. Messengers 0900-0430 Nursing 0430-0800 PT: 5 mins. %C&A = 99% Error-Proof Med Rec %C&A = 99% Add Pt. to Discharge Board; Update as Needed AFrame Purple = RIE-1 Blue = RIE-2 Orange = Project (Owen) Green = Leadership (Opal & Daryl) Prepare Patient Primary Nurse PT: 15 mins. LT: 30 mins. %C&A = 80% Remove Equip & Items w/ Meds/Body Fluids; Call EVS; Discharge Patient Discharge Patient Primary Nurse PT: 1 mins. LT: 1 hrs. %C&A = 99% P/U HUC 2.0 hrs. 5 mins. Water EVS PT: 5 mins. LT: 2 hrs. %C&A = 90% 30 mins. 15 mins. Clean Room; Change Bed Status to Available 60 mins. 1 mins. PT: 30 mins. LT: 60 mins. %C&A = 95% 60 mins. 30 mins. Lead Time (LT) = 6.1 hrs. Process Time (PT) = 127 mins. % Activity = 34.7% Rolled First Pass Yield = 21.7% Power Pole 15
- 16. Lean as abusiness management approach © 2010 Karen Martin & Associates 16
- 17. Building a C.I.Culture Years 5 & Beyond Company-wide engagement – everywhere, all the time Support needed only for audits, bandwidth gaps, continued learning “Life is Good” Stage • Daily kaizen is the norm • “Action now” dominates • Most processes are stabilized with minimal waste and output variation “Settling In” Stage Years 3 & 4 More staff engagement – reduced need for formal Kaizen Events Years 1 & 2 Small percentage of staff engaged – project-based Light support from seasoned improvement professionals Heavy support from seasoned improvement professionals • Demonstrating learned competencies • Process owners manage performance • Becoming more proactive “Disruption” Stage • Sensei-dominated • Much mentoring & learning • Heavy use of Kaizen Events • Many issues to be resolved 17
- 18. Obstacles to Success Problem:Lack of Alignment Around the Improvement Strategy © 2010 Karen Martin & Associates 18
- 19. Create a LeanSteering Committee? Role Gather improvement ideas from across the enterprise. Evaluate & prioritize improvement opportunities (closely tied to annual business goals). Enable alignment across leadership team. Communicate upcoming improvements and outcomes. Aid in necessary culture shift. Assure ongoing process measurement and continuous improvement is occurring. Determine ongoing workforce development needs. Stay informed about competing priorities and shift improvement focus accordingly. Allocate resources. Assess progress and adjust as needed. © 2010 Karen Martin & Associates 19 © 2010 Karen Martin &
- 20. Lean Steering Committee Composition- 10 people max Cross-functional Mixed perspectives (sr. leadership, middle management, improvement resources) Meeting Frequency – scaled back over time Monthly for first year or two Possibly quarterly for years 2-5 Disband in year 5, if organizational DNA is “set” © 2010 Karen Martin & Associates 20
- 21. Obstacles to Success Problem:Lack of understanding; Missing skills © 2010 Karen Martin & Associates 21
- 22. Largest Obstacle toSuccess: Lack of Understanding & Skills Lack of training Ineffective training Poor timing - Large gap between classroom content and real-world application Inappropriate content – too much, too little, etc. Establish clear learning objectives – what should participants be able to do after the training? Does Sr. Leadership really need to go through green belt training? Improvement professionals need to be proficient in ALL Lean tools and leading change No application – learn-do is vital! All principles and tools and no “sales” (here’s what Lean can do for us) © 2010 Karen Martin & Associates 22
- 23. “Hooking” People intoImprovement “You had me at hello.” © 2010 Karen Martin & Associates 23
- 24. Spectrum of Learning Continued Learning Proficiency Skill Development Deeper Understanding Behavioral Intellectual Awareness ©2010 Karen Martin & Associates 24
- 25. Largest Obstacle toSuccess: Lack of Understanding & Skill Development Leadership Initial ½-day to full-day overview Reflection and continued learning every six months Required reading – The Toyota Way and others Middle management Eventually at least a 2-day overview about key principles and process management Frontlines Eventually at least a 2-hour overview about key principles Heavy emphasis re: “what’s in it for me?” Improvement resources Significant development © 2010 Karen Martin & Associates 25
- 26. Improvement Professionals’ Learning Needs– The Basics Business Finance, sales & marketing, operations, etc. Your industry Your customers Your competitors Regulatory and political environment Market trends Your company / organization SWOT (strengths, weaknesses, opportunities, threats) Revenue streams Cost structure Business goals Leadership concerns (and other key stakeholders) © 2010 Karen Martin & Associates 26
- 27. Improvement Professionals’ Learning Needs(continued) General Process management Project management Communication Countering resistance Lean Philosophy Value, Value Stream, Flow, Pull, Seeking Perfection PDCA Workforce engagement © 2010 Karen Martin & Associates Analytical and Execution Tools Key Lean Metrics A3 Management Root Cause Analysis Value Stream Mapping Metrics-Based Process Mapping Spaghetti diagrams Kaizen Events 27
- 28. Improvement Professionals’ LearningNeeds – Tactical Tools Process Stabilization Tools
- 29. Improvement Professionals’ LearningNeeds – Tactical Tools FlowEnabling Tools
- 30. Professional Development for ImprovementResources University-based University of Michigan; Ohio State;University of Kentucky; University of Tennessee; San Diego State University; University of California, San Diego In-house certificate programs or singlesubject workshops Workshops & conferences – LEI, AME, Shingo, ASQ, IIE, etc. Read, read, read… © 2010 Karen Martin & Associates 30
- 31. Organization-wide Learning Lean foundationtools Tools: Work standardization, error-proofing, 5S & visual management (using the PDCA method) Audience: middle managers to senior leaders Initial training: half to full-day session Assignment: Improve one area or one process; one month to complete Reporting & reflection A3 problem-solving development 20 max; 4-8 problem teams (owners) Skilled coach © 2010 Karen Martin & Associates 31
- 32. Obstacles to Success Problem:Inadequate improvement resources © 2010 Karen Martin & Associates 32
- 33. Improvement Resources Internal Dedicated vs.shared responsibility Quantity External Training & development Leading improvement activities Observational learning + results generation Coaching © 2010 Karen Martin & Associates 33
- 34. How many dedicatedresources? Ultimately 3-5%, per GK. Examples 2,400 employee org has 4 dedicated resources and 15 part-time trained facilitators. 1,200 employee organization has 6 dedicated resources. © 2010 Karen Martin & Associates 34
- 35. Obstacles to Success Problem:Slow results © 2010 Karen Martin & Associates 35
- 36. Year One Experience quicksuccesses Requires skilled professionals – if not internal, then bring in external support Don’t attempt to solve your toughest problems first – build “improvement muscles” Gain leadership support Via education, experience, and results Familiarize the workforce to Lean principles and benefits Begin identifying and/or developing dedicated improvement staff. © 2010 Karen Martin & Associates 36
- 37. Year One –Quick Successes Select 1-3 value streams, based on business need Select executive sponsors and/or value stream champions Conduct proper value stream mapping activities, including the development of an actionable implementation plan Execute the implementation plan Heavy use of Kaizen Events to begin shifting culture, develop the workforce, and gain quick results © 2010 Karen Martin & Associates 37
- 38. Obstacles to Success Problem:Results not communicated © 2010 Karen Martin & Associates 38
- 39. Communication Options Intranet Closed circuitLCDs Posted / Visual Improvement boards Break rooms Hallways Paycheck stuffers Company newsletter Meetings Standing agenda item? © 2010 Karen Martin & Associates 39
- 40. Obstacles to Success Problem:Processes not monitored and continuously improved © 2010 Karen Martin & Associates 40
- 41. Process Management ProcessOwner Monitors KPIs (key performance indicators) 2-5 max Types Operational (Time & quality) Financial Customer / external stakeholders Employees / internal stakeholders Reports performance Leads continuous improvement as necessary Manager or lower is best © 2010 Karen Martin & Associates 41
- 42. Obstacles to Success Problem:Everything waits for a Kaizen Event © 2010 Karen Martin & Associates 42
- 43. Blue = Improvementsthat do not require help from others. Yellow = Improvements that require help from others.
- 44. Shingo-Prize Winning Company’s SuggestionProgram For ideas that require help from other departments: 1. The employee completes a yellow suggestion card and places it on the Improvement Opportunity Board under the “new opportunity” column for their department. Company-wide improvements are placed in the Company-Wide row. The department’s designated “improvement lead” reviews the suggestions and talks with stakeholder departments as needed. Company-wide suggestions are reviewed by the Lean team. 2. • • If OK’d, the improvement lead moves the card to the “in process” column, allocates resources, and the PDCA cycle begins. When the improvement is complete, the card is moved to the “completed” column. If not OK’d, the improvement lead contacts the employee directly and communicates why the suggestion won’t be implemented.
- 45. Recognition board includesphotos of the improvement and the suggestor’s name. Names from successful improvements go entered in a monthly drawing for prizes.
- 46. Shingo-Prize Winning Company’s SuggestionProgram For ideas that do not require help from other departments: 1. The employee completes a blue suggestion card, gets a manager’s 2. signature, and begins implementing the idea (via mini-PDCA). When the improvement is complete, the blue card is moved to the “completed column.” Recognition – – All the employees names for completed improvements (both yellow an blue) are entered into a monthly drawing for a gift card (movies, Starbucks, etc.) or T-shirt. Pictures of visual improvements with the employee’s name are placed on the “Wall of Fame.”
- 47. Obstacles to Success Problem:Workforce remains disengaged; improvement resources are expected to “do for others” © 2010 Karen Martin & Associates 47
- 48. Breaking Old Habits Definefacilitator for all Coach and teacher vs. “do-er” Communicate improvement resources’ roles and responsibilities Demonstrate through action Avoid having improvement professionals serve as the process owner Audit function only to assess organizational learning, progress, and reporting © 2010 Karen Martin & Associates 48
- 49. You will learn… How to establish a five-year improvement plan. Essential organization-wide learning needs. How to accelerate results via organization-wide 5S/ Visual Management, Standard Work, & Error-Proofing activities. The benefits of establishing a Lean Steering Committee. How to develop a kaizen culture that generates “single hits,” while also achieving home runs and grand slams. How to establish an infrastructure that builds organizational competencies, while generating measurable results. The importance of building a foundation for success even if you’ve been on the Lean journey for years. © 2010 Karen Martin & Associates 49
- 50. The Transformation Process: KeySuccess Factors Strong sense of urgency / burning platform Leadership alignment around strategy Improvement priorities are closely tied to organizational strategy and annual business goals. Careful planning to avoid “implosion” and change fatigue Value-stream driven improvements. Heavy use of Kaizen Events in first 1-3 yrs. Dedicated improvement resources. Entire workforce receives exposure to Lean. © 2010 Karen Martin & Associates 50
- 51. For Further Questions KarenMartin, Principal 7770 Regents Road #635 San Diego, CA 92122 858.677.6799 ksm@ksmartin.com © 2010 Karen Martin & Associates 51