Lean Thinking - Specify Value

The next few entries will share some examples of Lean Thinking in the Office and we will begin the journey with the first of five steps.  Begin Lean Office transformation with strategically aligning the opportunities.

Step 1. Specify value from the standpoint of the end customer by product family.






Beginning the Lean Office transformation is not a decision to be made flippantly and without a plan.  Does this mean you need to be in crisis mode or your platform needs to be on fire?  It's not required, but it does help to put energy behind and a reason for the change.  You may find that a new material is available on the market at a price that improves profitability, or Congress has written new industry regulations, or perhaps a company that you thought had no chance in being a real competitor has just had a successful launch of a new product or service.  What ever the reason, it is now in your lap.

To start this journey we first have to decide what product needs help the most.  Is it a series of financial reports, or briefings to provide information to decision makers, or how we procure office equipment?  One thing you cannot say is, "Lets go fix the sales team!!".  This is focused on the products we create, not people to berate.

Here we come to fix the Sales Team!!

The next step is to go have a conversation with your customer about the chosen product.  Now this should not be a scary trip to take.  When you schedule this discussion, frame it be asking some questions up front like "what about the delivery of my product needs to be perfect?".  Use this to collect attributes that would be critical to the quality of your product.

Another side of this method is asking what are the business needs of your operations.  Do you have to operate within a budget, or maintain a skills or knowledge requirement, or keep a safe work environment?  Think about the measures you are keeping now and are they helping you and your team find opportunities?  This is also a great chance to go talk to your boss about their expectations of your team since it is your job to make the boss look good.

The third piece of the puzzle is how the process is performing.  Are you having visions of SPC charts right now?  My friend's wife would yell out "NERD ALERT!!" at this point and we would all quickly look busy.  We should know what is going on, but the measures we take need to be used for good and not evil.  We never, ever take a chart and go beat up our supplier of data even if that was the standard practice in your industry.

This first step is very important as it sets the foundation for the rest of the things you will see and learn with this product and your team as it helps to create the vision of what the future looks like, but this is not a "one and done" activity.  As the market changes, you may need to do this with your customers on a regular basis.  It requires courage and tenacity, and don't be afraid to ask for help!  You may learn that you have some other Lean Thinkers on your team to help along the way and you will need their help when you move to the next step of transformation.

4P’s - People, Process, Product, Performance

Why should I focus on 4P’s?

I sometimes get the question from Leaders, “Why do I need to focus on the 4P’s?  We hire the best for the position and provide the fastest computers and software with all the bells and whistles.”  While this is all true and done with the best intentions, the “People” focus is only one piece of the puzzle that will only provide you with heroes.  Having a few of these on staff is good when the situation comes along that requires it, we don’t need this type of thinking all day and every day.  We have seen this often enough with our heroes, and we remember Dr. Eldon Tyrell saying, “the light that burns twice as bright burns for only half as long.” [Bladerunner, 1982]   And since hard workers are rewarded with more work, we could eventually find ourselves all out of heroes.

Keeping the other P’s in focus, Process, Product, and Performance, completes the picture of your operations.  Operational Awareness is about knowing how the internal organization is performing to meet ever-changing conditions in the market place, or how responsive we are to customer needs.  Process focus, or how we create our products, provides a picture of process predictability and stability.  Are there charts and metrics?  Yes and the team has the right skills uses this information to improve flow.  The only other options are intuition and customer feedback.  Unless you have a strong relationship with your customers you may only find out about poor customer satisfaction when the orders stop coming in.  Or worse you find your company's name on the web with a not very flattering writeup.

The measures will be based on inputs from suppliers, like quality, cost, and delivery, and our internal process results that also include quality, cost, and delivery along with safety and any other factors that may reflect your process.  These measures help to highlight the internal process “need helps” or abnormalities and when to intervene. Product focus draws our attention to the ability of the product, whether material or information, to meet customer demands and expectations.  These measures are based on the voice of the customer and will involve talking to them.  These customers may sit next to us or are on the same floor or product line, but these conversations help to clarify or define what they really want.

Performance measures describe on our ability to manage change.  This could be when to change, when to stop changing, or answer can we change before the opportunity disappears.  Our belief in our ability to make the right change can help carry us through times of stress when we know performance is not where it should be.  And having the right people in the right places can make that important impact to roadblocks, whether they are systems, processes or people.

Which of the P’s are most important?

At first glance it is easy to rationalize that all the P's are important.  While this is true you will need to think about it from your customer's perspective.  If they are happy with the price, but would like more (or less) features, then product may be most important.  If your business requires people to "connect the systems", then having well trained and highly motivated team members is most important.  If having a high quality product reaching your customers hands each and every time is part of your strategy, then process may be your main focus.

But if your market conditions are always changing, you should consider measuring all four P’s and keep them in a continuous improvement cycle.  There are many tools and methods to drive this philosophy; balanced scorecard, house of quality, learning to see value stream mapping, and lean function deployment just to name a few.

How to measure and improve the 4P’s?

You may be thinking, “Well that’s an interesting question and if I knew the answer then I would not need to hire consultants.”  This is not an answer that will be found like some lost scrolls in the desert when we accidentally happen upon them, but a journey with our customers, suppliers, and other stakeholders of our businesses.  Direct and real-time measurement is always best, and having the methods in place to respond immediately when abnormalities begin showing up.

These may be statistical control charts, survey results, andons, or other visual controls.  The key to keeping measures relevant is having the courage to review them and respond to abnormalities with your teams.  This is not a disciplinary action, but an honest look at team performance to customer or business needs and what are the root causes of problems.  

The 4P's are not a "quick fix", but a journey that helps us become a learning organization that is able to adapt to the ever-changing market conditions.

Operational Excellence

When we think about linking people with the processes, products, and performance, using a model helps us see at a high level.  This also helps to create a system framework that connects tools and thinking to standard practices we will use.  Operational Excellence is a concept of operations that focuses a team's outputs on consistently meeting customer's needs and improving supply chain relationships.  I will address Operational Excellence implementation, the integration of tools with Integrated Teams, and ways to monitor success that will help you retain your customer base and open doors to new customers.

Implementation is aligned to a team's continuous performance improvement level.  Teams that are actively using Lean, Six Sigma, Theory of Constraints, or other improvement methodologies will implement faster than those that only know they have problems and are not sure how to permanently fix them.  It's the recognition that problems exist, or the journey is stalled, and that is where we begin by talking to the customer, asking what would be perfect about the delivery of the product, and measuring performance results to those attributes.  This may not be an easy conversation, but it provides insight to the level of satisfaction your customers are experiencing.  Using this information, Leadership needs to be armed with the questions that keep a project or team on track to reach that level of perfection.

Integration of tools with the Integrated Teams, focused on specific problems, will affect the measures being taken from the Voice of the Customer.  Whatever improvement tools or methodologies are being used, the desired impact is to improve flow.  This is made by using Lean to remove waste, Six Sigma to remove variation and improve quality, TOC to synchronize the supply chain with the bottle neck and then remove the constraint, or any combination of those with the plethora of other tools that exist.  Remember this, "Flow is King!".  If the product if not flowing, whether in the material value stream or information value stream, then it is sleeping (on the job!).

Monitoring the organization's or team's progress on the journey is enhanced with visual controls linked with the Voice of the Customer and the Voice of the Business.  We collected VOC earlier so it's just a matter of calculating the center and spread of the data, compare that to "what would be perfect", and decide the first step to take.  Voice of the Business is based on corporate or business unit goals, or goals used by the team.  These are usually related to cost, safety, inventory-turnover, and other measurements relating to cash flow.  Again, collect you current data, compare it to the goal, and decide the first step to take.  This resulting information needs to be shared with the team, stakeholders, customers, and possibly suppliers.

As you collect the data and begin asking questions as to why the team is experiencing defects, long cycle time, customer dis-satisfaction, or other problems, you will identify opportunities to make positive impacts to flow.  These opportunities will need to be vetted against the root causes to make sure they will affect the bottom line, not just "good stuff" types of ideas.  One way to know if an idea will impact the bottom line is if it resides on the critical path.  Newly trained improvement facilitators can execute these opportunities to become "certified".  Becoming certified is another measurement, the next important metric is average cycle time for the facilitators reach their fifth project.

So Operational Excellence is a concept of operations that focuses a team's outputs on consistently meeting customer's needs and improving supply chain relationships.  This type of thinking about your operations and your organization will help jump start the transformation and turn opportunities into the dollars that can be used to grow your business.

Welcome to The Lean Office

I hope that you find the topics interesting and helpful.  Don't be afraid to ask a question or email a subject where you have an interest.  I want this to be your first place to find Lean Six Sigma tools, techniques, and funny stories in the transactional environment.

The mission of The Lean Office blog is to provide a place to share Lean Six Sigma examples in the office, and share thoughts and ideas of implementation of Lean Six Sigma in the office or other places your journey may take you.  Below is short video about the model we use, Organization Optimization.  Enjoy!