Work Standardization & Metrics-Based Process Mapping

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Learning Objectives The benefits of work standardization. The step-by-step process for work standardization. How to standardize “high variation work.” Characteristics of job aids. Current state documentation techniques. How to create Metrics-Based Process Maps. © 2011 Karen Martin & Associates 2

Building a Lean Enterprise Process Stabilization Tools

Building a Lean Enterprise

Standardized Work Defined The current single best way to complete an activity with the highest degrees of safety and efficiency, which produces consistent and high quality outcomes. © 2011 Karen Martin & Associates 5

Standardized Processes Yield Consistent Quality Results R1 Inconsistent Processes R2 People R3 Inconsistent Results R4 TRADITIONAL = People doing what they can to get results Standardization People Desired Results LEAN = People using standard processes to get results © 2011 Karen Martin & Associates 7

Benefits of Standardized Work Consistent quality Improved productivity Easier, more effective training Predictability; better decisions Foundation for making improvement © 2011 Karen Martin & Associates 8

Standardized Work Standardized work nips common problems in the bud so that staff can focus instead on solving uncommon problems. ― Bill Marriott, CEO, Marriott Hotels © 2011 Karen Martin & Associates 9

Process for Creating Standardized Work 1. 2. 3. 4. 5. 6. 7. 8. 9. Define scope – “fence posts” and conditions. Form improvement team. Study the current state to gain a deep understanding. Design the improved state. Document the improved state. Test and gain consensus. Finalize and implement new standardized process. Measure results; adjust if needed. Monitor ongoing performance. © 2011 Karen Martin & Associates 11

Key Success Factor – Plan & Communicate via Charter Improvement Charter Improvement Scope Leadership Due Dates Value Stream / Process Executive Sponsor Current State Analysis Specific Conditions Value Stream Champion Root Cause Analysis Process Owner Future State Design Facilitator Testing Complete Customer Demand Trigger First Step Last Step Boundaries & Limitations Implementation Timeframe Required Interim Briefing Attendees Event Drivers / Current State Issues Implementation Complete Results Validated Core Improvement Team Function 1 2 3 Contact Information 2 4 Name 1 3 5 4 Event Goals & Measurable Objectives 5 1 6 2 7 3 8 4 9 5 10 Benefit(s) to Customers, Company, Staff Additional Support Function 1 2 3 Contact Information 2 4 Name 1 3 5 4 Results Validation - Planned Method & Frequency 5 6 7 8 9 To download: www.ksmartin.com/files/templates/improvement_charter.xls 12

Standardizing Work – Step 1 Define Scope  Select the first and last steps (fence posts) between which you’ll standardize the process. 1 2 3 4 5 6 7 8 Area of Focus  Limit the conditions initially to reduce variation as you seek to deeply understand the current state. Aim to apply the future state to as broad a set of conditions as possible. © 2011 Karen Martin & Associates 14

Narrowing the Scope: Example Units Domestic Consumables Warranty Service Parts Order Fulfillment Process NonWarranty Units International Consumables Warranty Service Parts © 2011 Karen Martin & Associates NonWarranty

Improvement Team No more than 10. Composition:       Process workers (approx 50% of the team) Upstream suppliers (internal and/or external) Downstream customers (internal and/or external) Outside eyes – people who have no “skin in the game”; 100% objective Support services Subject matter experts © 2011 Karen Martin & Associates 18

Studying the Current State Steps: observe, measure, document, analyze   Go to gemba (genchi genbutsu) Document the current state – Options:  Spaghetti diagrams, photos, drawings, etc.  Metrics-based process map (MBPM)    Identify variation in terms of inputs, data, people, equipment & supplies, environment, etc. Study root cause(s) of variation What are the best practices? © 2011 Karen Martin & Associates 20

The Work We Do: Degrees of Granularity Rooftop View Strategic WHAT? Value Stream Primarily Leadership Process Value Stream Map Process Process Step Metrics-Based Process Map In the Weeds Tactical HOW? Step Step Primarily Workers © 2011 Karen Martin & Associates 21

Traditional Mapping Method: Process Flow Chart Look up Customer in Eclipse SALES New Customer? Yes Enter Order SALES Product in Stock? Yes Print Ship Ticket SALES Load Trucks SHIPPING No No Enter Customer Information ADMIN Yes Perform Credit Check FINANCE Okay? Notify Sales COD Only; Notify Admin No to update Customer Profile FINANCE Order Material PURCHASING Receive Material RECEIVING Where’s the quality? Where’s the time? 22

What is a Metrics-Based Process Map? A visual process analysis tool, which integrates:   Functional orientation of traditional swim lane process maps Key Lean time and quality metrics Tool which highlights the disconnects / wastes / delays in a process.  Keeps the improvement focus properly directed Means for documenting standardized work for workforce training and process monitoring. © 2011 Karen Martin & Associates 23

Lean Facilitator Range of Necessary Traits  Skills / Knowledge       Defining value; identifying waste Improvement tools (root cause analysis, flow-enhancing tools, etc.) Project & time management Team building / facilitation Mediation; consensus building People effectiveness – from front line workers to execs  Authority / Respect    Designated change agent / influence leader Trustworthy Comfortable removing obstacles & reaching out to senior leadership  Personality / Energy     Naturally curious Challenging, yet supportive Positive, upbeat, energetic Pushy without irritating  Objectivity / Fairness  No attachment to the work being improved © 2011 Karen Martin & Associates 24

Metrics-Based Process Mapping (MBPM)

Document the Current State Step 1 – Label the map in the upper right hand corner.  Include process name, conditions mapped, date, and facilitator name and/or team members. © 2011 Karen Martin & Associates 26

Step 1: Label the map Process Name Included/Excluded Conditions Current State MBPM Date Facilitator and/or Team Names Use 36” wide white paper with 6” swim lanes (hand drawn, chalk lines, or pre-printed). Pre-printed 8’ template is available at: www.ksmartin.com/files/templates/MBPM_swimlanes.pdf

Document the Current State Step 2 – Label the swim lanes with the functions involved.  Include external functions, if appropriate (e.g. customers, suppliers/contractors, etc.) © 2011 Karen Martin & Associates 28

Step 2: List functions Function A Function B Function C Function D Function E Function F Process Name Included/Excluded Conditions Current State MBPM Date Facilitator and/or Team Names

Document the Current State Step 3 – Document all activities/steps on 3 x 6” post-its.     Use verb/noun format; clear and concise. Include function. Separate tasks that have different quality outputs or timeframes; combine tasks otherwise. Place post-its in appropriate swim lane, sequentially. © 2011 Karen Martin & Associates 30

Step 3: Document the Activities Activity (Verb / Noun) Function that performs the task

Step Step 1 2 Ticking clock Parallel Steps (concurrent activities)

Document the Current State Map the rule (80%), not the exceptions (20%).  For metrics with ranges, use the median. Continue to add conditions to your scope if you need to.  To minimize “it depends” answers. © 2011 Karen Martin & Associates 33

Document the Current State Step 4 – Number the activities.   Number the activities sequentially from left to right. For parallel activities, add “A,” “B,” etc.  Example: Step 8A, Step 8B, etc.  Don’t number the post-its until the map is “final.” © 2011 Karen Martin & Associates 34

Step 4: Number the Activities Step # Note: For parallel activities, use alpha modifiers -e.g. 8A, 8B, etc.

Document the Current State Step 5 – Add task-level information:   Number of staff involved (if relevant) Barriers to flow  Batches  Shared resources  Equipment downtime  Etc.  Key metrics (include units of measure)  Process Time (PT)  Lead Time (LT)  Percent Complete & Accurate (%C&A) © 2011 Karen Martin & Associates 36

Step 5: Add Step-specific information Barriers to Flow (if relevant) # Staff (if relevant) • Batching • Shared resources • System downtime • Etc. % Complete & Accurate PT (Process Time) LT (Lead Time)

Key Metrics: Time Process time (PT)    The time it takes to actually perform the work, if one is able to work on it uninterrupted Includes task-specific doing, talking, and thinking aka “touch time,” work time, cycle time Lead time (LT)    The elapsed time from the time work is made available until it’s completed and passed on to the next person or department in the chain aka throughput time, turnaround time, elapsed time Includes Process Time, not merely waiting time. © 2011 Karen Martin & Associates 38

Key Lean Metric: Quality %Complete and Accurate (%C&A)  % time downstream customer can perform task without having to “CAC” the incoming work:  Correct information or material that was supplied  Add information that should have been supplied  Clarify information that should or could have been clear   This output metric is measured by the immediate downstream customer and all subsequent downstream customers. If workers further downstream deem the output from a particular step to be less than 100%, multiply their assessment of quality with the previous assessments. © 2011 Karen Martin & Associates 41

Metrics Reminders  Typically obtained via interview; questions must be high quality  PT & LT   You can “chunk” these metrics for a series of post-its when necessary When wide variation, do one of three things:  Narrow your scope (pick a specific circumstance)  Use the median  Indicate the variation, but use the median for the timeline  %C&A  Determined by immediate downstream customer and all subsequent downstream customers  %C&A for a post-it is the product of all downstream responses   Response is placed on the post-it for the output step 0% at a particular step is not rare © 2011 Karen Martin & Associates 42

Documenting the Current State Step 6 – Define the “Timeline Critical Path”  Longest LT unless “dead-end” step  If longest LT is a dead end step, then bring the next longest LT to the timeline  Use colored marker © 2011 Karen Martin & Associates 43

Step 6: Define the “Timeline Critical Path” For parallel activities: Chose the longest LT unless a “dead-end” activity

Step 7: Create the Timeline

Document the Current State Step 8 – Calculate the summary metrics    Time - Percent Activity Quality - Rolled First Pass Yield (RFPY) Labor Effort Complete metrics grid © 2011 Karen Martin & Associates 47

Summary Metrics: Time Percent Activity (%Act) (also referred to as Activity Ratio)      The percentage of time anything is being done to the work passing through the system (whether value-adding or non-value-adding) %Act = (∑PT ÷ ∑LT) × 100 100 – %Act = % Time Work is Idle Common finding = 1-10% Could also calculate %VA to show much activity is value-adding – is typically lower than % Act. © 2011 Karen Martin & Associates 48

Summary Metrics: Quality Rolled First Pass Yield (RFPY)     The percent of value stream output that passes through the process “clean,” with no “hiccups,” no rework required. RFPY = %C&A x %C&A x %C&A… Common finding = 0-15% Multiply ALL %C&A’s, even if parallel processes © 2011 Karen Martin & Associates 49

Summary Metrics: Labor Effort Total PT  Sum of all activities, not just timeline Labor Effort # FTEs = Total PT (in hrs) X # occurrences/year Available work hrs/year/employee •FTE = Full-time Equivalent (2 half time employees = 1 FTE) © 2011 Karen Martin & Associates 50

Metrics-Based Process Mapping Summary Metrics Metric Timeline PT Timeline LT % Activity Rolled First Pass Yield Total Process Time Labor effort Freed capacity Current State Projected Future State Projected % Improvement

Document the Current State Step 9 – Identify the value-adding (VA) and necessary non-value-adding (N) activities    Use small colored post-its labeled with “VA” or “N”. All unlabelled post-its represent waste. NOTE – this is the first of two “bridge steps” between current state documentation and future state design. © 2011 Karen Martin & Associates 52

Customer-Defined Value Value-Adding (VA) - any operation or activity your external customers value and are (or would be) willing to pay for. Non-Value-Adding (NVA) - any operation or activity that consumes time and/or resources but does not add value to the product (good or service) the customer receives.   Necessary – support processes, regulatory requirements, etc. Unnecessary – everything else - WASTE © 2011 Karen Martin & Associates 54

Typical Current State Findings Unnecessary NVA Available to work on Necessary NVA Value Add “N” Post-it Available to next step “VA” Post-it Future State Design: How can we advance from one “VA” or “N” step to the next and eliminate all waste? © 2011 Karen Martin & Associates 56

Document the Current State Step 10 – Circle the step-specific metrics that indicate the greatest opportunity for improvement.    Low step-specific %activity, low %C&A, etc. This is the second of the two steps that provide the bridge between current state documentation and future state design. Use a brightly colored marker © 2011 Karen Martin & Associates 57

Step 10: Circle the data that indicates the greatest need for improvement

Standardizing Work – Step 3  Study the current state to gain a deep understanding (observe, measure, document)   Go to the Gemba Document the current state – Options:  Spaghetti diagram  Metrics-based process map (MBPM)  Photos/drawings   Identify variation in terms of inputs, data, people, equipment & supplies, environment, etc. Study root cause(s) of variation  Five why’s  Cause-and-effect diagram (fishbone)  Pareto  What are the best practices? © 2011 Karen Martin & Associates 59

Current State Facilitator Tips  Keep the team focused on current state.  Quickly flip chart future state ideas to capture them, then return to current state.  If the LT is 8 hrs for a block, it doesn’t matter if the PT is 5 or 8 mins.  Limit debates over things that don’t matter.  If three people perform the work three different ways, select one way for the current state map.  Create a safe environment for “telling the truth.”   “It is what is it. No blame. No worries.” “People aren’t the problem. The process is the problem.”  Help them “digest” how “bad” the process is.  “It’ll be easy to be a rock star!” © 2011 Karen Martin & Associates 60

Avoid “Process Tampering” Process tampering is making changes without:   a complete understanding of the process. the basis (measurement) to predict how the process will perform with the improvement in place. Process tampering is often a result of firefighting – dousing the flames without the basic understanding of what caused them and root cause corrective action. Process tampering typically doesn’t lead to improvement and often worsens the process. © 2011 Karen Martin & Associates 63

Avoid “Process Tampering” Process Improvement Process Tampering Simplifies Complicates Fire Prevention Fire Fighting Measurable Subjective Fact Driven Opinion Driven Improves Morale Erodes Morale Prediction Detection Customer Focus Mandatory Customer Focus Optional Processes are Improved Blame is Established Saves Money Costs Money © 2011 Karen Martin & Associates

Future State Design Standardize work, resulting in:  Increased quality  RFPY and %C&A for individual process steps  Increased responsiveness / better flow  Timeline LT and LT for individual process steps  Increased % Activity  Reduced labor effort (to free capacity)  Total PT for entire process   Increased safety Less stress; increased morale © 2011 Karen Martin & Associates 65

Future State Design Considerations  Eliminate steps / handoffs  Combine steps  Create parallel paths  Alter task sequencing and/or timing  Implement pull  Reduce / eliminate batches  Improve quality  Create an organized, visual workplace  Reduce changeover  Eliminate motion & transportation  Standardize work  Eliminate unnecessary approvals / authorizations  Stop performing nonvalue adding (NVA) tasks  Co-locate functions based on flow; create cells (teams of crossfunctional staff)  Balance work to meet takt time requirements 66

Standardizing Work While Allowing for Variation Create a “process spine”    Standard work at key milestone points Controlled variation between the standard work points Accommodates the “art” of knowledge work x x x Standardized Work x x

PACE Improvement Prioritization Grid Easy 5 4 13 23 8 22 17 3 10 21 1 16 15 20 19 14 6 7 11 2 18 12 Difficult Ease of Implementation 9 High Anticipated Benefit Low

Create an Action Plan: Who, What, When, Where, and How? Future State Implementation Plan Value Stream Outpatient Imaging Implementation Plan Review Dates Executive Sponsor Allen Ward 11/1/2007 Value Stream Champion Sally McKinsey 11/21/2007 Value Stream Mapping Facilitator Dave Parks 12/13/2007 Date Created 10/18/2007 Block # 2 Goal / Objective Improve quality of referral Improvement Activity Type KE Implement standard work for referral process Owner Sean O'Ryan PROJ 1/10/2008 Implementation Schedule (weeks) 2 3 4 5 6 7 8 9 10 11 12 Dianne Prichard 3, 4 Reduce lead time beween schedulingand Cross-train and colocate work teams preregistration steps 5, 6 Eliminate the need for two patient checkins Collect copays in Imaging KE Michael O'Shea 6 Eliminate bottleneck in waiting area Balance work / level demand KE Dianne Prichard 9 Eliminate lead time associated with transcription step Implement voice recognition technology PROJ Sam Parks 10 Eliminate batched reading Reduce setup required KE Sam Parks 7 Reduce inventory costs, regulatory risk and storage needs 5S CT supplies area; implement kanban KE Michael O'Shea 12 Reduce delay in report delivery Implement additional fax ports PROJ Martha Allen 12 Reduce delay in report delivery Increase percentage of physicians receiving electronic delivery (rather than hard copy) KE 1 Martha Allen Approvals Executive Sponsor Value Stream Champion Value Stream Mapping Facilitator Signature: Signature: Signature: Date: Date: Date: Date Complete

Document Projected Future State Results Metric Current State Projected Future State Projected % Improvement Timeline PT Timeline LT % Activity RFPY Total PT Labor Effort Freed capacity © 2011 Karen Martin & Associates 70

Summary Metrics: Labor Effort Total PT  Sum of all activities, not just timeline Labor Effort # FTEs = Total PT (in hrs) X # occurrences/year Available work hrs/year/employee Freed = Current State FTEs – Future State FTEs Capacity * FTE = Full-time Equivalent (2 half time employees = 1 FTE) NOTE: Can convert into labor expense if want to show financial impact of waste. Or report in hours if less than 1 FTE difference. © 2011 Karen Martin & Associates 71

Future State Facilitator Tips  Reduce resistance by pointing out how “boring” waste is and how energizing it is to provide customer value.  Spark innovation by using examples outside your own company / industry.  Guarantee the team that they will not lose a paycheck and that they’ll be properly trained for any new role they take on.  Guarantee the team that if the process is more difficult (after a learning period), you’ll revisit the improvement.  Guarantee the team that you’ll only make a process change if it’s indeed an improvement. © 2011 Karen Martin & Associates 73

Standardizing Work – Step 5 Document the improved state    Reduce reliance on traditional standard operating procedures (SOPs) Increase reliance on the metrics-based process map itself and “job aids.” Include the expected process performance metrics. © 2011 Karen Martin & Associates 75

The Improved State Becomes Standard Work Current State Metrics-Based Process Map 0 PT Units 1 0 Seconds Hours Minutes Days LT Units 15 6 -1 0 Seconds Hours Minutes Days Process Details Specific Conditions Domestic orders through sales force Occurrences per Year 37,500 Hours Worked per Day 8 Date Mapped 25-Jun-08 Step # ► Function / Department 1 Customer Mapping Team Diane O'Shea Sean Michaels Sam Parks Sally Dampier Michael Prichard Process Name Order Fulfillment 1 2 Activity PT LT %C&A Fax PO to Sales Rep 0 0 Ryan Austin Mary Townsend Facilitator Dave Morgan 3 4 45% PT LT %C&A Activity PT LT %C&A Review PO; clarify with customer as needed 20 2 90% Fax PO to warehouse 10 4 Activity PT LT %C&A Activity PT LT %C&A Check inventory levels; notify Sales Rep re: status 2 Sales Rep Activity 5 90% 5 4 95% Fax PO to Sales Rep 5 0.33 90% 5 Finance 6 Warehouse / Shipping Critical Path PT Critical Path LT Rolled %C&A Total PT 0 20 0 0 10 2 45% 20 5 4 90% 10 5 4 90% 0.33 95% 5 90% 5 From Metrics-Based Process Mapping: An Excel-Based Solution (Productivity Press)

Color-Coded Summary Metrics Sheet  Auto-Calculates:     Summary time and quality metrics for before and after maps Projected % improvement (color-coded for visual ease) Staffing requirements User-defined metrics

Standardized Work Job Aids • Simple • Visual • Physical • Posted at point of use • Created by people who do the work and tested by others

Job Aid Criteria  Serves as memory jogger  Simple   Just the facts Strong emphasis on reducing variation to improve safety, quality & efficiency  Visual - Strong use of:    Color Photos Drawings © 2011 Karen Martin & Associates  Physical   Posted where the work is done (and/or carried by process worker) Not hidden in a computer  Created by the people who do the work    With strong involvement by the customer Test thoroughly! Gain consensus! 79

Assembly Visual Aid Page 1 of 2 OP#: CELL: 2 25 DESC.: Threading Operation Authorized By: Joe Blow MODEL(S): DOC. NO. : Inspect work done at previous station Step 1 1Take part from cart 2 Inspect for cracks, burrs and poor plating (see sample boards) Step 4 1. Switch button from “manual” to “automatic” Value add operations Step 2 1. Place body in machine fixture. 2. Make sure part is seated in fixture as shown in photo Step 5 1. Once part is threaded, take out of fixture and load next part 2. Review that part is threaded properly All model “A”s V25-2A DATE: 03 / 03 / 97 Self inspection Step 3 1. Pull the red button located at the front of the machine Step 6 1. Place piece on mounting rail for next operation.

Checklists assure all critical tasks are done within defined timeframes

Improvement Testing Purpose: Work out the bugs and gain consensus (to enable sustainability)   Run on “real time” processes. Have others review, comment, etc.  As broad a sample as is “reasonable.”  Adjust as needed. Plan Act Do Check © 2011 Karen Martin & Associates 86

Finalize & Implement Implementation = relevant and effective training. Consider non-traditional means. Never communicate changes by email alone. Plan Act Do Check © 2011 Karen Martin & Associates 89

Standardizing Work – Step 9 Monitor ongoing performance – continuously improve as needed.  Who?  Establish a “process owner” – supervisor or below    How often? How are results communicated? Who coordinates ongoing improvement? “You get what you expect and you deserve what you tolerate.” © 2011 Karen Martin & Associates 94

Work Standardization: Summary Must be created by the people who actually do the work. Remove all obstacles to worker success. Beware of over-standardization re: process and environment – it’s the results that matter. Must be clearly and easily communicated; MBPM and job aids are indispensible tools. Must be monitored and modified frequently. Frequent retraining may be necessary. © 2011 Karen Martin & Associates 96

Metrics-Based Process Mapping Resources Chapter 12 – Manual method

Additional Resources Chapter 12 Chapter 9 Chapter 5 98

Learning Objectives The benefits of work standardization. The step-by-step process for work standardization. How to standardize “high variation work.” Characteristics of job aids. Current state documentation techniques. How to create Metrics-Based Process Maps. © 2011 Karen Martin & Associates 99

For Further Questions 7770 Regents Road #635 San Diego, CA 92122 858.677.6799 ksm@ksmartin.com Free monthly newsletter: www.ksmartin.com/subscribe Learn / Connect : 100

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