Lean Is In the Simplest Things

Shadowboard
Workplace organization is fundamental to any lean manufacturing implementation.

Some time ago, I was having a discussion with an operator about workplace organization.  During our conversation, the operator pointed to a fixture that was stored on the floor under a piece of equipment.  He told me that the fixture was heavy but there was no other place to store it.  The circumstance was an ergonomic injury waiting to happen.

The solution was actually pretty easy:  buy a small lift table to keep the fixture on.

Read any text about lean and you’ll get to the chapters about takt time, kanban, poke yoke, maybe even heijunka.  You won’t often find the chapter that tells you to make certain that all tooling and fixtures are easy to get to, easy to maneuver,  easy to put away.  But until you listen to your operators and help them eliminate or, at least, reduce the frustrations they deal with every day, they aren’t going to be interested in anything else you say about lean.

Our Latest Industry Week Article: A New Twist on “Going to the Gemba”

Ron Jacques and I have made a pretty good writing team over the past year or so.  Ron has a long and varied career in manufacturing.  The guy has a million stories!  (He’s also, if his stories are any evidence, a damn good manager of manufacturing operations.)  Our workflow has been that he gives me the stories and I turn them into articles; we’re the Lennon and McCartney of lean writing!

Our recent article provides a twist on the rightfully honored idea of “going to the gemba”.  The lesson is…use all of your senses!

We’re pretty sure you’ll enjoy this one.

We’re pretty sure that you’ll enjoy the others we’ve written over the past several months that I haven’t posted here on the blog.  I’ll provide links to those articles, one at a time so that I don’t overwhelm you, over the next few months.

Lean Uses All Senses

Is It Wrong that I Refer to Managers as “Dumbasses”?

I think that I’ve mentioned that I teach in the B-school at nearby Kent State University.  In the course catalogue, the course is referred to as “Individual and Group Behavior in Organizations”.  I call it “Organizational Behavior” (and so does the rest of the world.)  During the first class of each semester, I tell my students,  “The world is full of dumbass managers…I don’t want you to be one of them.”

OK, so I posted that in a comment on LinkedIn recently…and got some pushback:

In 23 years of full-time teaching, I never described managers using an ad hominem attack. I simply ask my students to lead in ways that better than how they have been led.

So…am I wrong to make a generalization about “dumbass managers”?

In part…yes, of course, I’m wrong.  As the old saying goes, “No generalization is worth a damn, including this one.”

My larger point is that too many managers are not up to the job.  We can argue whether my language is appropriate or not, but to focus on that is to miss the point.  Evidence supports the argument that the “Great Resignation” is caused primarily by toxic corporate cultures.  Such cultures aren’t “accidents” or “acts of God”.  They are created by managers who are ignorant, careless, negligent, and/or just don’t give a damn.  As a former colleague of mine once said, “A fish stinks from the head”.  If the place smells rotten, look to leadership for the source of the stink.

And here’s the thing…creating a strong, positive culture isn’t that difficult.  It’s not brain surgery, at least.  Don’t get me wrong….it takes patience, perseverance, and discipline.  But there’s no “secret sauce” to it that some organizations have figured out.  It may not be easy, but it IS straightforward.

Here’s the second thing…there is a wealth of data that confirms that a strong, positive culture provides superior performance just about any way you want to measure it.  Stock price, revenues, margin, customer satisfaction…they’re all directly correlated to culture.  When the culture gets better, so do those measures.

So…creating a strong, positive culture is straightforward and it provides measurable benefits.  And yet weak, toxic cultures seem to be widespread, if not prevalent.  There must be a lot of dumbass managers out there.

Why Is Takt Time So Confusing?

First, everything I’ve read about blogging says that bloggers aren’t to point out (apologize for) long periods between blog posts.  “Just start posting again and forgo the mea culpas,” the experts tell me.  But….two years between posts?  Who does that?

I was recently reading some typically boring article on lean that, like so many others, harped on the importance of takt time.  Now, I’m not one to deride the idea of takt time, especially given that many others seem to find it useful.  (Or I guess they do….else why does it continue to show up in the literature so often?)  It’s just that pretty much everything I’ve ever read provides the same tired definition without really explaining what it means.  

Here’s an example of that  tired definition  (I picked this one pretty much at random…I just web searched on “takt time definition and went to the first one I saw):

“Takt time is the rate at which you need to complete a product to meet customer demand. For example, if you receive a new product order every 4 hours, your team needs to finish a product in 4 hours or less to meet demand.”

First, who gets a “new product order” every four hours? (Given that the first sentence refers to “customer demand”, I assume the author is speaking of new product orders from customers, not production work releases.) Second, in what world is a manufacturer in a position to start on an order that has just been received immediately after the previous one is finished? Mind you, I’m not saying the definition is totally bogus, I’m just saying that it’s confusing.

Here’s the definition in Wikipedia:

“Takt time is a manufacturing term to describe the required product assembly duration that is needed to match the demand. For example, if the customer demand is 10 units per week, then, given a 40-hour workweek and steady flow through the production line, the average duration between production starts should be 4 hours, ideally.”

Once again, we’re left to figure out what to do if we don’t get new product orders every four hours. Or what to do if customer orders come in willy-nilly in a wide variety of quantities and characteristics.

Some books and articles provide a formula for takt time as if customer demand were constant across time and not something that changed moment by moment.

Once again, I’m not saying that the definition is wrong, I’m just saying that it’s not very helpful. No client I’ve ever worked for has the steady, predictable flow of customer orders that takt time definitions always seem to refer to.

We’d be better off if practitioners were more forthcoming about the underlying purpose of takt time (assuming that they actually know it): smooth, predictable flow of material through the manufacturing process. It wouldn’t be difficult to get workers to brainstorm, for example, those things that prevent smooth flow: downtime, scrap, errors, problems with material, tooling, machinery, and so on. It would be easier (and better) to get operators talking about how to reduce or eliminate those things than it would be to try to teach takt time. So let’s do that.

Little’s Law

I’m surprised at myself that I’ve never written about Little’s Law.  It’s one of those things we lean geeks love to trot out to show that…we’re lean geeks.

This article gives a quick background of Little’s Law.    As the article says, Little’s Law (and equation) has been translated to the manufacturing setting thus:

Work In Process (WIP)  = Throughput X Cycle Time

Continue reading “Little’s Law”

The Economics of Lean

One of my own maxims regarding lean implementations is that, if a company goes into a lean implementation with its primary goal that of cutting costs…it will fail.  Sadly, too many managers and practitioners disagree. Essentially, they just don’t understand the economics of lean. They tend to look at the wrong end of the transaction between seller and buyer.

The wrong interpretation of lean economics leads us to believe that the best way to get customers is to reduce our own cost structure.  That might be true if what we’re selling is a commodity that can’t be differentiated in the market.  If we’re both selling a product or service that can’t be differentiated, then the customer will certainly buy from the one of us who has the lower price.  Even in that narrow situation, we’re better off seeing the customer as striving to maximize his or her value.  If the customer can’t discern which of our products provides the greater value, it’s rational to base the buying decision on price. The buyer’s decision looks like this:

Here’s the thing:  If we’re differentiating our product on price alone, it’s easy for our competitors to follow suit and price their products below ours.  Now we and our competitors are tied together in a race to the bottom that neither of us is likely to win given that we can’t reduce our costs or our prices to zero. But that’s what “lean as cost reduction” tries to do.

The better strategy, then, is to differentiate one’s own products and services in ways that it’s difficult for competitors to emulate. That’s exactly what lean does.  Let me make this clear:  lean doesn’t provide strategic advantage by allowing the manufacturer to lower costs.  It provides strategic advantage by creating organizational capabilities that allow the manufacturer to provide increased utility to the customer.

I once facilitated a value stream mapping team at a steel making company here in Ohio.  A team member asked me to provide a definition of lean.  He said: “I’ve been to all sorts of seminars and heard all sorts of definitions but I still don’t think I understand what it’s all about.”

I responded, “I don’t have a concise definition but here’s how lean works:  What’s the lead time that you quote when a prospective customer calls?”

“About twelve weeks,” replied the engineer.

“And I bet you hit that every time, right?”

The engineer chuckled, “It’s considered a success if we fulfill the order in sixteen weeks.  We’ve taken as long as 36 weeks to fulfill an order.”

So, I asked, “If we could hit that twelve week mark consistently, would that help the company, even if we didn’t reduce our costs by a nickel.”

“Without question, our sales would increase.”

I went on: “So, let me ask this…if we could consistently hit an eight week turnaround time and still not take a nickel out of our costs, would that benefit us?”

The engineer’s quick reply: “We would control the market.”

The conversation illustrates, in a nutshell, the true economic value of lean:  it differentiates the product and service on factors other than cost.  Though our price is the same, perhaps even a bit higher, than that of our competitors, the customer sees more utility, therefore, more value in our product.    In this case, the buyer’s decision looks like this:

Whence comes this superior value, even if the cost might be higher?  The truly lean organization provides, to customers, what they want, how they want it, when they want it consistently.  Customers don’t worry whether they’ll get their product on time (if at all), in the right quantity (if at all), or if it will meet their expectations and standards.  This reliability differentiates the lean manufacturer from its competitors.  Lean, then, is a top line strategy rather than a bottom line strategy.

“But,” you might reasonably ask, “doesn’t lean, in fact, reduce the manufacturers cost of goods by reducing waste in processes?”  The answer, of course, is yes.  We’ll address that in our next article.

 

 

 

 

 

 

 

How Toyota Introduces Tech

Over the years, I’ve resisted linking to “outside” articles other than my own.  I always felt that I should provide original content.

I’m revisiting that decision because, of course, there’s a bunch of good literature out there that’s not my own.  Sharing such of that literature as I become aware of with you strikes me as a way this blog can add value.

This article is a good example.  I’ve been reading a bit about Industry 4.0 and digital transformation lately.  Most of it is interesting stuff but too much of it presents technology as intrinsically “good”.  This article, published by my friends at Industry Week, reviews Toyota’s more enlightened approach to tech.

The starting point is this: where are real needs that technology can address to help achieve your goals? This is a question of pulling technology based on the opportunity, instead of pushing the technology because it is the latest fad.

Enjoy.

When the Toyota Way Meets Industry 4.0

 

A Lesson in Visual Management

Check out the video below. You don’t have to watch the whole thing (but you probably will…it’s an interesting video, to say the least) just enough to get a sense of the action and dynamics.

The flight deck is obviously a VERY risky place to be. Everyone MUST be where they need to be when they need to be there or the shit will hit the fan.

The first thing I noticed is that everyone has a bright color jacket on. Each color is for a different role. Each role has specific duties to carry out.

I tell my clients, “Workplace organization and visual management allows you to tell, at a glance, whether your processes are in control or not.” This video illustrates that axiom clearly; we can see how someone on the flight deck could tell at a glance if someone else was in the wrong place at the wrong time, potentially putting themselves and others in danger.

It works to make a high risk circumstance like the flight deck a bit safer. It works to keep your own shop floor safer and more productive.