World Class Processes

Cost/Time Profiles and Lean Implementation

Over the past 15 years CPI has used Lean, Lean Office, Six Sigma, and other tools to significantly improve and/or turn around four different businesses. Our success comes from helping businesses understand the Cost/Time Profiles that are unique to their business and then demonstrating the "simplicity" of Lean and the elimination of waste in concert with other continuous improvement tools. Unfortunately, Lean is all too often viewed simply as a means of cutting costs (which is certainly does), but if that is the only focus then the implementation can cut staff members who are critical to the real transformation process that needs to take place.

At CPI we prefer using Lean as a GROWTH strategy, not simply as a means of cutting costs. Our reasoning comes from the symbiotic relationship that exists between managers, leaders, and employees within the business and their knowledge of where the problems lie. The secrets and solutions for improving business efficiency and profitability by 20 – 30% will need to be gleaned from your employees. Not only do they hold the answers to your problems, by gaining their "buy in" and trust, the solution shoule be sustainable. If employees are carelessly cut and lost due to layoffs or RIF’s their knowledge will also be lost with them. 

In some cases the business situation is so dire that cuts must be made to prevent financial failure. If the business is financially overburdened and cannot survive running in the red for the 12 – 18 months that it may take to turn things around, then the business will need to make the cuts first and THEN implement Lean and/or Six Sigma. A critical element of this reduction process, however, is that the cuts need to be made with a scalpel, not a meat cleaver. 

Knowing what to cut requires a brutal assessment of what is providing value to the end customer as well as profits to the business and what is not. Here again, you need managers to provide the details and risks and leaders to sort through it all and create the new vision. Once the determination has been made concerning what products or services are to be eliminated or outsourced; implementation plans can be put into motion and focus can be shifted back to the core products, services, and value of the business. 

The remaining staff should be reassured of their continued employment AS LONG AS they actively and quickly work to help make significant improvements to the business that remains using Lean. By drawing on the knowledge and expertise of the remaining managers and staff to clearly map their current processes and the vision of their leader to collectively identify opportunities to eliminate waste and frustration, one process at a time, they will be successful. 

Achieving Sustainable Results; the Missing Elements of 5S

The generally accepted and anglicized versions of Toyota's 5S elements are: 

1. Sort 

2. Set in Order 

3. Shine 

4. Standardize 

5. Sustain 

Most businesses do an exceptional job of attaching the first three elements but fail to create a NEW standardized process at the conclusion of the Lean Kaizen Event. Unfortunately, as the Lean Team moves on to tackle the next process the workers from the most recent event are left to sort through problems that were left behind on their own. The morning walkthroughs become less of a priority and things have a tendency to fall back into the old habits and old processes. 

To combat this businesses need to focus on ALL elements of 5S. Once a new process is established through a Lean Kaizen Event it needs to be clearly documented, taught to all operators, and taken on operationally as the responsibility of everyone within the organization (see Top Down and Bottom Up). Sustainability is not an option; it’s a requirement.

Leaders, Managers, and Their Roles in Continuous Improvement

Gary Monti, President and CEO of Change Management Consulting, describes the difference between a leader and a manager as being the difference between one who believes and is willing to take a risk (leader) and one who knows (manager). He frequently describes the yin and yang of leaders and managers before helping his clients understand the need for both views in order to successfully manage the “complex and chaotic nature” of change management. 

At CPI, while we agree with Mr. Monti’s analysis and conclusions, we would also suggest that there is an additional subtle point that is critical to the process of change and the co-dependence of managers, leaders, and the employees. 

In our own experience true leaders do, indeed, have the ability to “step outside” of the current situation and see the bigger picture. And the most successful leaders are the ones who can then communicate their vision to others in a compelling fashion that is most effective when it is “very simple” and easy for everyone to grasp. More importantly, to be truly effective, the leaders need to recognize the value that their managers and their extended staff provide in two critical roles that act as book ends to the “visioning” process. At the front end a savvy and effective leader will use the data driven skills of managers to collect the information and relative risks to be weighed in the visioning process. On the back end they will enlist the help of those managers in the myriad of activities that are necessary to change the course of the business and drive it in a new direction. 

Furthermore, rather than assuming that the only value a leader brings is “vision” at the top level, this same relationship and relative qualities of managers and leaders lies at the very heart of Lean Manufacturing and Lean Office. Over the past 15 years we have used Lean, Lean Office, Six Sigma, and other tools to significantly improve and/or turn around four different businesses. While these tools are extremely effecitive, at the end of the day, they are just two tools among many that can be used and or required thebring the business to Peak Performance 

The Eighth Deadly Waste 

LEAN was created by Toyota Motors in the early 1990’s with the express purpose of eliminating WASTE (MUDA in Japanese) and increasing FLOW or the movement of material on the production floor. Lean, which is sometimes referred to as “TPS” or the Toyota Production System, has been expanded today to include office processes as well.

The seven wastes as originally defined were:

Transportation (moving products not actually required to perform the processing)

Inventory (all components, work in process, and finished product not being processed)

Motion (people or equipment moving or walking more than is required to perform the processing)

Waiting (people waiting for the next production step)

Overproduction (production ahead of demand)

Over Processing (resulting from poor tools or product design creating extra work)

Defects (the effort involved in inspecting for and fixing defects)

Later an eighth waste was defined as the "waste of unused human talent".

At CPI, we believe that this eighth waste, which was defined by James P. Womack and others, is the worst of all and is the real key to resolving all of the others and effecting real and lasting change within businesses today. This particular waste and its resolution ties back to our previous discussion on managers and leaders.