Apr
29
Out of the mouth of babes
Filed Under Human Architecture, Lean Enterprise, Six Sigma, Strategy Execution | Leave a Comment
I am putting this out there for the entertainment of some of the long time practitioners - sometimes you get something communicated to you that just makes what we do worth it.
From Ernesto Garcia’s and my good friend Patti who works in Treasury at her company -
Interesting…. here are my 2 cents worth on my thinking about Six Sigma / Lean. I will preface by admitting that I am still a rookie at this stuff compared to a “godfather” such as you but having seen the evolution at (name deleted to protect the guilty) and now being in another company who uses Lean/Six Sigma, I have boiled down what I think are the critical success factors and what, conversely, can lead to failure. I agree that labels and silver bullets won’t work…. the bottom line is problem solving, change and process improvement.
To succeed:
1. Do not ignore that this is a culture. Involvement of every individual is critical. Not all people in the organization will be the problem solvers but everyone can shed light on where the trouble spots are, have great process knowledge and, if asked, often have great ideas for change.
2. Do not treat Six Sigma or Lean as an exercise. Do not allow the “belts” to conduct data gathering sessions or process discussions and then leave the process owners without providing any feedback or evidence of what happens next.
3. Pay attention to the control phase. What is the action plan? What are the countermeasures needed should the process indicate slippage to prior state?
4. Make it fun. Use real-world examples. De-emphasize the statistical aspects unless your audience is going to actually use that information. Lots of people don’t like “math”…. go figure! (pun intended)
5. All leadership must understand and embrace the concepts. It’s even better if they believe it.
6. Don’t make it about the size of the project, i.e. the $$$$$. Lots of little projects and small successes add up to benefiting the organization plus they build confidence and momentum amongst the members of the organization.
7. Make it ok to use tools as needed without having to do a whole “project”. Get people thinking about using process maps, fishbones or FMEA’s, for example, in meetings to help focus on the problem and instill some discipline to the discussion. Additionally, make the quest for appropriate data gathering and insightful questioning routine. Do not gather data or use tools just for the sake of it.
8. Make sure your “belts” are equipped to be the teachers and change agents that you need them to be. Focus on their strengths…. not all should be classroom trainers, for example, but should all be capable of transferring the knowledge to the rest of their organization. Assess soft skills when deciding whom to send to training and provide coaching, training and mentoring on those skills to those who are seeking certification. Find a way to “grade” the soft skills as part of the certification or review process. It’s about marketing once these “disciples” are set loose into the organization.
On the surface, this seems pretty simple but it also seems to be overlooked from my observations and discussions with people who have been doing this for a while…. kind of common sense if you ask me. Ask anyone…who doesn’t want to “make his or her world a better place?”
Patti, for what’s it worth. I’ll bet you just made a friend of some old friends of mine. Specifically Mike Carnell.
Well said.
Gary
Apr
29
Supply Chain Costs
Filed Under Supply Chain | Leave a Comment
In response to my ramblings about supply chain last week, John Gross wrote –
“I would also challenge anyone who is contemplating China to look at his or her total cost. Consider the inventory holding cost, sourcing support cost, and transport cost vs. the cost of producing components in a lean manufacturing process.”
I also got a note from my good friend Shawn Alexander asking –
“How about some thoughts on costing of the supply chain? I am frustrated on how no one has a comprehensive, industry standard way to understand the cost of whatever logistical chain you choose for a product, and fewer still even consider the idea of adding this cost into their product costing/pricing.”
So my question is what so hard about doing the math to understand supply chain costs? Is it because of the millions we claimed in savings in the past few years? Is it because our companies’ margins are obscene (Shawn and I know that company)?
Seriously, the list of important costs is finite and include –
- Inventory costs (whether yours, your suppliers, or your distributors)
- Forecast errors
- Re-planning and PO changes
- Lost opportunity costs associated with late delivery and expediting including the 20 -60% of the time your sales force spends holding the customer’s hand instead of up selling because of the ease of doing business with you.
- Incremental transportation costs
What have I missed?
Would anyone in your business care if we could define a defendable model?
Gary
Apr
28
Lean Six Sigma
Filed Under Lean Enterprise, Six Sigma | Leave a Comment
Take the time to go look in the mirror, it is one of the most important diagnostic tools people and companies have (thank you Marty Rayl). It is also one of the least used.
Lean and Six Sigma have always been joined, but they are separate but equal partners. Ask any of the implementers from the mid 80’s at Motorola and they will tell you that Cycle Time Reduction accelerated everything.
How does an implementation look like if you don’t just hit the ground running with Six Sigma? Simple -
- Take and honest look at yourself and define who you are and who you need to be.
- Align strategy and annual planning with the honest view of you.
- Define the few metrics, besides financials, that show that we are making progress or not.
- Align reward systems with metrics and define the cheater metrics as well in the reward system. Make sure what is rewarding is also in line with the metrics for the majority of your employees who work for you because they believe in what they do. Some examples of this type of person are most of your technicians, engineers, nurses, pharmacists, … Communicate strategy and plans broadly and consistently.
- Map the Value Streams of the few key end to end processes. Map flow of materials and services; flow of information, and flow of cash.
- Identify disruptions in two passes. First pass is the process as it exists today; the second is the process as it will exist if you meet near term growth targets. The disruptions are your project areas (yes, Goldratt is right). Don’t get hung up on hard savings (today’s issues) vs. soft savings (growth facilitating projects). Just make sure there is a balance between the two (thank you Larry Bossidy)
- Charter and plan projects (preferably as part of next years operating plan).
- Take care of the human architecture. This has two forms. The first is team dynamics, make sure your folks who need to be trained have been trained. This includes the seven basics tools and in my world would include many of Shainin’s tools. The second is choosing and nurturing champions and change agents. The common advice of “best and brightest” is necessary but not sufficient. You choose change agents based on something that is encoded in their DNA and is easy to measure. Just know that I believe that the advice that a good change agent is a good manager is terrible advice.
- Do Lean – Standard Work, 5s, SMED, and other Lean tools are among the best variation reduction tools you will ever meet. I can get any of you the first 75% of most of your BB projects with these tools and I can do it in the gap between M and A in DMAIC. Why would you do it any other way? Go get the first 75% and then see what is most important.
- Do Six Sigma – this is for those things that don’t give you what you need with Lean. This may be because they require much more sophisticated analysis tools. It is more likely they just need more time and someone (I nominate BB’s) willing to roll up their sleeves and do the blue collar grunt work of digging through massive amounts of data and making sense of it (analysis phase tools).
- Share the learning broadly and democratically. What I mean by this is that very little of what is done in Six Sigma or Lean is sensitive enough not to be shared with everyone in your company’s value stream. Those who are driving improvement will always stay ahead of those who are trying to learn by watching.
- Repeat.
As anyone knows that has done this successfully, there is overlap between all of this.
Don’t go deciding Lean, Six Sigma, or Lean Six Sigma is the answer until you have defined clearly where the opportunity is.
First things first.
Gary
Apr
28
The Champion
Filed Under Six Sigma | Leave a Comment
Another from a few years ago. It’s still good.
From my good friend Ernesto Garcia, PhD -
The Champion
Long time ago, in another country, I had the pleasure of working as a consultant for the VP of Quality of an international paper company. As usual in consulting, we used to have some conversations over lunch. In one of those informal meetings I asked him “why are you in this position.” His answer was simple: “I have been here many years, formed most of the current VP´s, and they will listen and act when I ask them to do something for our Quality initiative.” This answer, and the training and mentoring of many Black Belts during their first and second projects, led me to one conclusion: all projects need at least three ingredients to succeed: technical competence, political influence and sound allocation of resources.
As all you know in Six Sigma projects, the Black Belt and process experts provide the technical competence or “know how.” This is a matter of training and application of tools appropriate to the context of the problem to solve and, of course, experience with the process and product where the problem lies. On the other hand, exerting political influence and making sure the allocation of needed resources is obtained, the main tasks of the Champion, make the implementation of company policy to happen. Therefore, how can a Champion be a good implementer of policy through Six Sigma projects?
Perhaps the answer is in the common trait I have seen in successful Champions: constant search for the answer of three questions when they deal with Black Belts and their projects:
1) What is the relation of your project with the objectives of the business?
2) What have you done to satisfy these objectives within your project, and
3) What do you need from me to make it happen?
The first question needs a lot of involvement from the Champion. She, in her position, can normally understand better where the company is heading than the Black Belt; she is closer to the top. Thus, the selection of the project, and its Critical to Quality or CTQ, should pass an acid test: leverage and support of company policy. The development of a simple tree diagram linking the objective(s) of the business to the project CTQ during the definition phase is critical.
The second question has to do with the correct application of the methodology after project definition: MAIC. A Champion ensures that all phases are covered in detail. Thus, she will always ask for proof of: (1) reliability, integrity, and validity of the data used (Measure), (2) Rigor of the investigation (Analysis), (3) Feasibility and impact of the changes recommended (Improve), and (4) Proof of sustainability of the solution (Control).
The third and last question has to do more with our Champion’s commitment and her ability to influence the organization, but it can be summarized in the allocation of one resource: the time she takes asking those questions to her Black Belt, as well as the time she obtains from other members of the organization to help the Black Belt during his project.
Good Champions have at least one meeting with their Black Belts every two weeks, excellent Champions schedule meetings every week. These meetings do not take much time, just 15 minutes. The important thing is to look for answers to the above questions in each meeting, as well as to obtain a list of key persons the Champion must influence for the sake of the project and the company. Outstanding Champions make telephone calls, aisle conversations, and other types of contact to ensure that key members of the organization will commit their time and support for the project.
At the very end this is not new for a successful Champion: it is called leadership.
Apr
28
Why does this stuff work?
Filed Under irRelevant Reflections | Leave a Comment
I wrote this a few years ago, but I think it still is true -
Recently I have been in awe of rediscovering something I first learned in 1984. It is why this stuff really works. I have been working with two people who I have just recently met, Ernesto and Mike. Let me tell you a bit about each and come back to why this works.
Ernesto is a Mexican national, educated at Tecnológico de Monterrey, Monterrey Tech to us gringos. He has a BS and MS in Engineering from there. He has a PhD from a US college obtained on a Fulbright scholarship. Smart guy. Also has a great value system and was taught it by a guy who sounds like my father. He is dedicated to doing the same with his children. He is helping me create a model so that my company can better understand and support something they honestly don’t understand right now. When painting the picture for him of what I wanted he honestly has become excited by it and is bringing thought to the table that would not have been there for someone who is just going through the motions. He is one of the finest humans and one of the best Master Black Belts I have ever met.
Mike is an engineer from Ohio. I just found out he is leaving the company next week. It saddens me, but I also know that he is leaving for the right reason; he has found an opportunity that truly excites him. He will be improving what is already one of the finest health care systems in the world. Mike brings honesty and passion with him to the job. It is fun to work with him because he truly gets excited when he learns new things about a system he has been embedded in for years. He is a fine human and will be the best Black Belt in healthcare in the Americas.
Learning and watching people learn is among the best of the human experience.
Why does this stuff work? There are all sorts of theories out there about change management and I think most are wrong. There is a scene from the movie The Breakfast Club that I think sums up why people change better than anything else I have ever seen. The scene is between Claire (Molly Ringwald) and Allison (Ally Sheedy). Claire and Allison are on opposite ends of the high school social spectrum yet this scene finds Claire being kind to Allison.
Allison – “Why are you being nice to me?”
Claire – “Because you are letting me.”
Relationship to what we do? Change happens when the people who built and run a successful enterprise actually let their guard down and let people like Ernesto and Mike help them.
I train, help, challenge, cajole and many other things to get people ready to let their guard down on the one side and to accept the invitation on the other.
I live for the moments where these two points in time converge. It is the fulfillment of the human experience for me.
It is beautiful.
Gary