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Topic Title: Communicating Lean Progress
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Created On: 10/23/2015 09:13 AM
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10/26/2015 07:15 AM
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TAT
Todd Thomas



Our company has been on a much accelerated path on our Lean journey. It was all good until business started to boom. Currently our workload is to the point where I can't grab extra people to work on Kaizen events without letting customer orders suffer. Our HR department has been trying to get more people hired but the unemployment rate in our area is about 2.8%. The executives of the company are now asking why they are not seeing results from Kaizen events as well as making comments about our Lean efforts losing momentum. Our Lean efforts are still alive but they are mostly about the small wins and not the big Kaizen type savings. How do I communicate that to the top level when they think if we aren't doing Kaizen events we aren't doing Lean?
10/28/2015 08:26 AM
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AlisonMorin
Alison Morin



Hi,

Lean isn't about the big wins it is about small, continuous improvements that are planned well and quickly executed. It sounds as though you have reached your next gate in your learn journey and you need to change up your approach to everyday Lean. Are you using Gemba boards or Kanbans? Is management going on Gemba walks? It does not sound as though they are as engaged as they could be if they are judging your current state from a far rather than participating in the culture. Just an observation. Have a nice day.
10/28/2015 08:26 AM
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Boeing_Lean
Ken Hunt



Their mindset needs to change. They need to understand that process improvements aren't just a result of "events", but of practicing Lean daily as a part of Standard Work. It's about hitting a series of base hits, not home runs.

If you document the small wins and what they are doing for your company, the results will speak for themselves.
10/30/2015 08:25 AM
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Lyndis
Lyndis Davidson



Hi Todd,
This is an issue I'm struggling with too. I found that senior management are not interested in lots of small wins, they want the BIG SAVINGS. And they are not interested in team building, employee engagement or any of these softer benefits. Especially now our budgets are reducing they keep asking, "Where is the money?". Some folk are more creative about selling the numbers. I'm reluctant as I feel that's spin, but maybe it's just a necessary evil.
Still, I am fairly stumped about how to sell the numbers on multiple small wins and employee engagement.
I'm interested to see other responses to this.
11/02/2015 09:58 PM
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JohnSnyder30
John Snyder



Where I work presenting the numbers the way the management wants to see them is a necessary evil.

I try and make sure that the way I present the information leads to the correct direction from an improvement effort. As an example, if I need to take out a negative to get a cost approved even if the overall numbers do show an improvement anyway, many managers tend to only want to look at any negative number, so I have had to suppress those numbers and only give them the good parts of the data to move on with a project.

I completely dislike doing this however again it seems many times that is the only way to move forward most of the times to see any real improvement.

I would like to hear how many others feel they need to do the same, or if I'm in a place that is in the minority.
11/06/2015 11:37 AM
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oberkele
Owen Berkeley-Hill



This is a sorry reflection of the lack of progress Lean has made in the twenty five years since the publication of The Machine That Changed The World.

From the posts so far I get the impression that the organisations are lead by people who have no clue about Lean, see their involvement as irrelevant; and are only interested in the BIG NUMBERS when it comes to savings.

This is a high-risk strategy but if you have access to a brave pill do please show this post to those leaders. It might change their minds but then it might not:
    Lean is not just an optional process-improvement methodology competing with the likes of TQM and Six Sigma

    Lean is arguably the most significant advance in our understanding of how a good leader should Think, Believe, Behave, and Act

    Leaders who do not have a visceral knowledge of Lean are probably past their "sell by"

    Dabbling in the odd Lean tool will bring some benefits which may not be sustained, but it is not Lean

    If the organisation does not encourage learning through kaizen to the tune of 10-20 sustained improvements a year by everyone (including those with titles beginning wit C, then it is not Lean


I could go on but I hope you get the picture. I know this makes uncomfortable reading, but do feel free to show this to you leadership, and I hope it helps, because otherwise all the effort and resources invested will be a waste.

Good luck!
04/13/2016 01:45 PM
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Running_Lean
Dan Barch



My Favorite (true) Story: The CFO enters the GM office and asks 'What are you doing differently?"
"What do you mean?" the GM Asks
"Well things look different"
"It that good or bad?" (the GM is a little nervous)
"Its good. We're saving money. But I just can't pinpoint where. We make the same thing, but it just costs less"
"Yup!" says the GM. "Is that ok?"

Moral: You cannot really predict the impact of better awareness, which is the real benefit of Lean.

So just keep going, and report results as they happen, and remember to report *what you have learned*. Not all results are financial - good leaders know that.

And yes, this is a true story. Always makes me smile.
01/30/2017 10:15 PM
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PLiepmannFAAFP
Peter Liepmann



Todd,
have you looked at recruiting out of area?
Have you talked with top management about improving results company-wide?
What are their biggest concerns?
03/27/2017 04:01 PM
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286025
Paul Serafino



I think people get lost in defining wins based on measurements that don't matter - like # of kaizens, cost savings, throughput. Metrics are good to have, but WINS specifically need to happen for the customer. A small win for a customer could be a giant win for you. Small internal wins might have zero impact on customers, and so what was the point?

I wrote a case study of my own journey through these muddy waters, how I figured out how to generate meaningful wins...real value for customers...and the enormous positive impact it had on my career.

It's too long to paste in here, so here's a link to a PDF on dropbox. I've already shared it with a group of Lean and Continuous Improvement professionals having the same struggles you describe here. So far they're finding it hugely valuable, so I think you will too.

https://www.dropbox.com/s/m8x6m6b31pono8j/MyLeanCaseStudy.pdf?dl=0

Paul
03/29/2017 08:21 AM
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NickParsons
Nick Parsons



Hi Paul,

I have to say that is a great read. Very true to the fact and a position I see happening right now. (Option A)...

We are currently measuring various aspects of improvement, mainly trying to discover the amount of money / time saved through improvement. This as I am sure you will know is a very difficult and possibly dangerous measure.

Following Option B makes a lot of sense, if I read correctly you are pointing to working backwards from what the customer desires and making that happen where required. Increasing the value of what they are willing to pay for by removing or mitigating the parts they are not.

I find it really interesting and wonder how you go about measuring value increased in terms of a report or KPI. How would you demonstrate the increased value due to any improvement activity.

I guess this would be different to calculating money saved and so on.

Again, really good case study, thank you.
03/31/2017 07:56 AM
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286025
Paul Serafino



Thanks Nick!

You're right, find what the customer desires (wants, needs) and work backwards.

Careful on increasing the value - just by removing what they aren't willing to pay for, doesn't automatically make it more valuable to them.

What they perceive to be valuable is what you need to find out. If you increase perceived value of the exact same product, the metric is that you can increase price.

If you create NEW value for them, and get paid, your metric is new revenue stream or incremental sales or lift or margin...something along those lines.

If you see a way to give them what they ask for and it will cost them less, they'll always listen ("value"). Your competitors are already trying to figure that out. If you're in a commodity space, find out how to you can increase your unit price/margin, but decrease your customers' total spend (hint: supply chain inventory...look there!)

See the difference?

Example: if Ford convinced the marketplace that the Focus is identical to a BMW 3 series in "performance" they should be able to increase the price of a Focus.

If Ford creates a new solution for the market, say wiper blades that fit any make/model and repair windshield pitting while clearing away the rain, they can put those blades in every Autozone and make money in addition to their car sales.

If Ford sells the wipers online direct to consumer they can offer a lower price but at higher margin (most likely).

An improvement activity in your facility should be measured based on how much it contributes to making that increased value or new value possible. If it won't contribute, don't do it yet.
04/03/2017 09:31 PM
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DannyLuo
Danny Luo



Hi Paul,

Could you please share your PDF with by email? For I can't access to this link you post in China. Thanks! My email is dannyluo@msn.cn.
04/03/2017 09:32 PM
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kevinkobett
kevin kobett



I think there is a process of creating value for the customer. 5S, kaizen, etc. are invaluable for training employees. Anything that produces a cost savings. Everyone can focus on learning how to use the scientific method. Once the skills and confidence of the workforce expand, the sky is the limit for creating customer value.

One other missing ingredient is the employee question, "What's in it for me?" How do we create value for our employees?

Here's something I wrote years ago. It chronicles my transformation from employee to entrepreneur creating value for both my employer's customers and myself.

"You must do four things to develop a self-managing workforce:

Enable workers to learn by example.
Induce people to share opportunities.
Identify and utilize conscientious people.
Motivate workers by keeping them focused on long term benefits.

For example:

After two weeks on the job, Fred has the confidence of a veteran high achiever. He has spent a good chunk of his work time reading company patents. Fred especially likes drilling down to stories of achievement from his new area of responsibility, the paint department. He understands how procedures were developed.

Another database, the opportunities database, lists problems/irritations/observations collected from the company's entrepreneurs. (Everyone has the same title, entrepreneur.) Fred learns paint has been peeling at an abnormally high rate.

One fateful day, Fred became the center of attention. He placed his first observation in the opportunity database: "According to our customers, red paint never peels." Another entrepreneur, Sarah, uses Fred's observation to invent a reliable paint adhesion test. Fred and Sarah receive a company patent and split the royalties. The company gains another training story.

Royalties are paid in points that can be redeemed for high quality merchandise or services (similar to the quality the company desires). Fred wants a shotgun, but he is short on points. Fred sets his sights on obtaining another company patent.

After receiving his company patent, Fred learns his opinions suddenly carry a lot of weight. Achievement is a key component of conscientiousness. It's difficult to achieve if you don't care. A company patent program identifies conscientious people. These conscientious people will take over management decisions.

Fred couldn't hit the broad side of a barn with his new shotgun. Before he developed his skills at Kobett Enterprises, Fred would have labeled himself a "poor shot" and accepted his fate. Now, he views his irritation as an opportunity. Fred knows practice makes perfect. However, it is difficult to practice with a shotgun. The shooting range is miles away. Additionally, you must coordinate the trip with a buddy who can throw a clay pigeon. If Fred had the opportunity to practice everyday, he knows he would become a good shot. The solution reveals itself when Fred sees an ad for laser tag. Combine a shotgun with laser tag. A conversion kit enables the shotgun to emit a laser pulse when the trigger is pulled. The target travels along a cable in the backyard. Since Kobett Enterprises does not utilize this technology, Fred acquires a US patent for his invention. Fred's fellow entrepreneurs offer Fred a licensing agreement for his invention..

The boundaryless organization is a conglomerate. Its product line is only limited by the creativity of its entrepreneurs."

The shotgun target turned out great; it's nothing like my first thoughts:

http://jfshooting.com/category/shooting/

Everybody wins. The most important task for lean today is to create jobs for Americans. The leantrepreneur's product will likely be protected by patent and immune to foreign competition.
04/04/2017 06:43 AM
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286025
Paul Serafino



Really great points Kevin! Once a company knows what its customer really want and truly need, delivering isn't just as simple as someone saying "let's go do it everybody!"

The right training makes it possible, and the Lean system of management, organizational development, and tapping people's creativity is paramount.

"Leantrepreneur"? I love that.
04/06/2017 02:43 PM
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kevinkobett
kevin kobett



Paul,

Thanks for the kind words.

You greatly increase your odds of providing customer value by targeting leantrepreneurs in the hiring process. This is simple as leantrepreneurs have an intense desire to achieve.

You must answer the following question before entering our HR portal: "What made you happy on your last/current job?" A leantrepreneur will say an achievement, like creating a new paint adhesion test, made her happy.
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