Tag Archives: continuous process improvement

Improve Sales by focusing on customer/supplier relationships

sales

Continuing with the theme of improving our sales process, it’s important to remind ourselves that satisfied and delighted customers are the lifeblood of any organization.

Providing customers with the highest quality products and services at the best possible price starts with clearly understanding the customers’ needs and requirements and then designing and implementing processes that consistently deliver value.

But there are two types of customers:

  • external customers
  • internal customers

It’s important to recognize that both types of customers are important and have needs that must be met. External customers are the people who pay for our products and services. As Dr. Deming said: “No customers, no orders, no jobs!”

Paying attention to the external customers’ requirements is essential and helps us keep the entire organization focused on doing value added work (i.e., “work the external customer would pay for if they know what we were doing”).

However, to effectively meet the external customers’ needs, we must also work with our internal customers. Understanding and meeting our internal customers’ needs and requirements helps the process of producing our product or service to flow smoothly, be problem-free and deliver the highest quality at the lowest total cost. When we work with our internal customers we are, in fact, “internal suppliers.”

Of course, this customer-supplier relationship extends to our external suppliers as well. From our external customer’s point of view, we are responsible for what they buy from us; and our suppliers are part of the system.

It is increasingly important to build strong customer/supplier partnerships that ensure that we get exactly what we need, in the right quantity, at the right price to be able to meet our external customers’ needs.

Studying Our Work to Improve…

If we’d like to increase sales by improving our “sales” process, we should begin by studying our work. As a first step, identify our top customers’ 3-5 “must-have” requirements. As requirements are identified, it helps to understand their relative importance. What requirements does the customer consider “musts” versus “wants?”

Keep in mind that customer requirements are constantly changing as well, and yesterday’s “wants” may become tomorrow’s “musts.”

Sales Process Improvement: 5 best practices & 20 questions!

sales

While many businesses make efforts to improve production, distribution, and various administrative work processes, it is less common to find organizations that focus on applying the fundamentals of Continuous Improvement to the sales process.

However, our research and experience indicate the selling process is more complex than many people realize. In addition, we have consistently found that the largest waste in most commercial and industrial organizations is lost gross margin that results from sales not made, sub-optimal pricing, and excessive costs in sales-related processes.

So, leaving aside the “selling skills” or “charisma” that is often associated with those perceived as the most successful sellers, when you consider the day-to-day activities required of field-based sales professionals, there are some proven best practices that can help boost field-day efficiency, which include the following five:

  1. Pre-call planning: by planning each sales call in advance, in writing, sales people can position themselves to accomplish more in less time, thus increasing personal productivity as well as accelerating overall cycle-time. Not only will conducting more comprehensive sales calls increase efficiency, but the habit will also make a stronger, more positive impact on customers. Many who have embraced this best-practice report that their customers recognize the difference and, over time, become more willing to schedule meetings, thus enabling them to more easily make more calls each day.
  2. Set a daily call volume goal. This may sound like an unnecessary step, but a surprising number of sales people are unable to quantify the actual average number of sales calls they make each day. As author Jack Falvey has said, “Want more sales? Make more calls.” By setting an average personal goal, (or company requirement) which will vary depending on the nature of each territory, sellers are often able to self-motivate more effectively and make more calls per day.
  3. Geo-plan: by creating a strategic geographic or travel plan each day, outside sales people can minimize drive time and optimize “face” time (Or, in our current situation, “virtual face time.”). The best plans will begin by creating territory quadrants and then mapping the locations of customers and key prospects. The rule-of-thumb is to avoid traveling beyond two quadrants in any given day, so when an appointment is set in one area, try to schedule meetings or plan to visit others in the same general region to enable a maximum number of interactions in a minimum amount of time.
  4. Bookend each day by scheduling an appointment early in the morning and another late in the afternoon. This will promote “staying the course” as opposed to deciding to drive back to the office early to do administrative work. This best-practice might also help to achieve item #2 above.
  5. Try to schedule next steps (i.e., follow-up meetings, conference calls, etc.) “on the spot” before the conclusion of each sales call. This simple best practice can significantly boost efficiency for two reasons. First, it helps sales people more easily populate their calendars for future selling days in the field; and second, it can help shorten selling cycles by securing time with buyers sooner than could be done otherwise.

But the sales process extends well-beyond a day in the field, as it encompasses everything from identifying a lead to delivering a solution. Considering this broad spectrum, it is really not surprising that the largest waste within most businesses can be found in the sales area.

The first step toward improvement or to moving from “where we are now to where we’d like to be if everything were right,” is to identify specific areas of sales process waste, and a good way to begin might be to answer the following 20 questions:

  1. What is our current market share?
  2. What are our customers’ requirements?
  3. How well are we meeting these requirements?
  4. What would it take to truly delight our customers?
  5. How long does the sales process take from lead to sale?
  6. What is our lead conversion ratio?
  7. What were the top 3 reasons for lost sales over the past quarter?
  8. How many calls do our sales people make, on average, each day?
  9. How much time do we spend talking with uninterested or unqualified leads?
  10. How do we continually improve our sales team’s skills and habits?
  11. What percentage of prospects contact us first?
  12. How does this percentage (#11) compare with industry data?
  13. Does the sales process take less time to complete for inbound leads? If so, how much less?
  14. What is our response time to customer or prospect inquiries?
  15. How many customer complaints do we receive?
  16. How much time do our sales people spend interceding or responding to complaints?
  17. What is done with the information associated with customer complaints?
  18. How do customer complaints or how does customer dissatisfaction impact our ability to make sales?
  19. How often are discounts extended, and what is the average discount?
  20. Are discounts offered due to competition or in response to dissatisfaction?

Clearly there are many ways to analyze and improve the productivity of an organization’s sales process, but these five best practices and twenty questions are good starting points.

Decision making process

In a past post we discussed the importance of having a decision-making process, as researchers from various sources all agree that “how” we make decisions in business is as important as the decisions themselves!

Their studies also indicate that the “best” decision-makers share certain traits. They:

  • Follow a process
  • Involve others when appropriate and use knowledge, data and opinions to shape their final decisions
  • Know why they chose a particular choice over another
  • Are confident in their decisions
  • Rarely hesitate after reaching a decision

The first trait is critically important, as following a standard process enables people to make more deliberate, thoughtful decisions by organizing relevant information and defining alternatives.

Naturally, there are different processes from which to choose, and the previously mentioned article shares one approach.

Here is another option developed by the University of Massachusetts, Dartmouth.

  1. Identify the decision
  2. Gather information
  3. Identify alternatives
  4. Weigh the evidence
  5. Choose among the alternatives
  6. Take action
  7. Review your decision

it’s about time!

time_is_money

When we are faced with the task of evaluating and improving a business, we have many metrics to choose from. We can ‘follow the money’ — study the spending: where does it go, how does it compare to previous periods or to competitors; we may look at market share or wallet share; we might measure revenue per employee or benchmark against the competition; or we might measure customer satisfaction or the customer experience.

But one of the most powerful measurements for helping to make breakthrough improvements is also one of the simplest: following where the time goes.

In fact, many agree that time is the most universal and most valuable component of work and work processes! Consider that by determining how much time it takes to complete a cycle of value (i.e., building a widget, closing the books, making a sale, completing a project, etc.) and how much of that is truly adding value, an organization captures information that provides a motivating vision and road map for making improvements.

Key areas to study are delays, over-processing, rework, transportation, and inspection; and using time as a measure to find and focus opportunities for improvement has three big advantages:

  1. time drives important business results
  2. time is universally applicable
  3. it is very simple to do — i.e., something anyone can do!

Once you’ve decided that managing time is an ideal way to reduce costs and increase customer (internal and external) satisfaction, you might try using the following five steps for effective measurement:

  1. Identify the process to study and improve — where it starts and where it ends.
  2. Confirm with the customer (internal or external) the key element of value the process yields. Sometimes this is obvious, but in some cases not so much. An accurate understanding of what the customer considers of real value is key to any improvement effort.
  3. Determine how long the process actually takes today. This number— in minutes, hours, days, or weeks, whichever is best suited to the process — is the TOTAL component of the ratio we will calculate in step 5. Some questions often arise at this step:
    • Should we collect “person hours” or elapsed time? Measure elapsed time. If you study and improve elapsed time, you increase customer satisfaction and quality as well as costs. Person hours spent on the work almost always decline when an organization focuses on elapsed time.
    • How precise do we need to be? It is valuable to get good data about the total time elapsed from start to finish, if only through a modest sample. Of course, there will be variation — and the variation can be quite substantial for some processes. Keep the raw data and calculate the average TOTAL.
  4. Determine which steps actually add value and how much time is spent on those. For a step to be considered to add value, it must:
    • Be directly related to what the customer values and would pay for (if they knew what we were doing)
    • Actually change something of value — the product, database, approval status, whatever, (inspecting something or moving something does not actually change the thing, so does not ‘add value’)
    • Do so for the first and only time. Fixing or reworking something does NOT add value, because it compensates for not being done completely or correctly the first time.
    • Often these steps must be done today, because they compensate for an imperfection somewhere in the process. Correcting those imperfections is what will yield the improvements.
  5. Study the differences between the total time and the value adding time to identify and eliminate the root causes. Then calculate again. To calculate the ratio: if total time today is 55 hours and value adding time is 2 ½ hours, then the ratio would be either:
    • Total-to-Value: 55 divided by 2.5 = 22, which means that the organization spends 22 hours for every 1 hour of value add, or
    • Value-To-Total: 2.5 divided by 55 = 4.5%, which means that 4.5% of total elapsed time is actually spent adding value.

It doesn’t matter which you use, as long as you are consistent.

The hardest part of continuous improvement

While almost every business puts some amount of effort into Continuous Improvement (CI), making ongoing and meaningful improvements to a business or to work processes is not easy.

discontinuous_improvement

We have also noticed that regardless of the specific methods used for making improvements, almost all of these initiatives aimed at gaining greater efficiency, quality, speed, and/or customer delight have two important things in common:

  1. They generally produce some improvements, and
  2. Then they peter out

So, as it turns out, these well-intended CI plans are, in fact, “discontinuous,” and the hardest part of Continuous Improvement is making it “continuous!”

Based on our research and experience, there are some common reasons why CI efforts tend toward becoming discontinuous.

The most common pitfall that leads to ineffective CI efforts is unclear or delegated leadership. Continuous improvement must be fully embraced by every line manager. Delegating the effort to a Quality Manager, HR leader, strategic planning manager, or other staff person, is very likely to lead the effort to fizzle.

John Kotter, a recognized pioneer in the field of leading change, uses the term ‘guiding coalition’ to describe a powerful and strategic group that works together to bring about the desired changes within an organization. The team must be committed to the achievement of a continuously improving culture. It should include a majority of the most powerful people in the organization and may also include some people who may not be a part of senior management.

The next culprit is insufficient communication. Leadership must continue to communicate at every possible opportunity and every possible way why continuous improvement must become part of the organization’s DNA.

The vision must be clear and simple, and throughout the organization, people in leadership positions should constantly communicate the importance of continuous improvement and the progress to date. Successes must be widely shared, learnings must be plowed back into the organization to accelerate results, and new opportunities to become better at improving should be identified and clearly communicated. New employees must hear the why, the how, the
history, and the vision of what’s next.

Finally, neglecting alignment is a sure way to undermine a comprehensive CI effort. Every one of us has our own personal goals and objectives in addition to the goals and objectives of our organization as a whole and our job in particular. When these get out of alignment, progress will stop.

For example, a natural and intended outcome of most process improvement is the ability to do more with less — often with less people-time. Instantly, we have a conflict between the organization’s goals for cost saving and people’s need for income retention. And processes cannot be effectively improved or improvements effectively sustained without the support of the people doing the work. Not coincidentally, the company with the longest history of a continuously improving culture, Toyota Motors, promises employees a very high level of job security.

The leadership must think several moves ahead to both maintain alignment and to capture financial gains from productivity improvements. The choice of where to focus improvement efforts is probably the most critical.

Among the best areas on which to focus are:

  • Aim improvement methods to address the constraint to sales.
  • Improve productivity in the parts of the organization with too much work, in order to eliminate the need to hire.
  • Improve productivity in an area where people have the skills that, if freed up, could be transferred to departments with too much work or that have had attrition.
  • Improve non-people costs, such as energy, scrap, paper waste (‘if you want to find the waste, find the paper’), and work with suppliers to identify ways to reduce costs.

Engagement Around the Work

Continuous Process Improvement Squared

Research over the past decade has consistently shown that increasing workforce engagement is a good thing:

  • Gallup: Disengaged workers cost the nation $450 billion to $550 billion per year in lost productivity.
  • Towers Perrin: Companies with engaged employees have 6% higher net profit margins.
  • Kenexa Research: Engaged companies have 5 times higher shareholder returns over 5 years.

Beyond greater productivity and profitability, additional documented positive benefits of engaged workers include lower turnover, better safety, fewer product defects and shrinkage, reduced absenteeism, and better customer satisfaction metrics.

But in spite of the proclaimed benefits of engagement, the efforts made to increase it have too often not paid off in a measurable way. .

We have identified four key reasons why so many have struggled to engage their workforce:

1. Lack of definition.

Taking a “we’ll know it when we see it” approach to employee engagement is like trying to hit a moving (or invisible!) target. The first step to a formalized engagement plan is to identify goals and metrics.

Stephen Wendel from HelloWallet, offers a commonly used definition of engagement: “Engagement means having an emotional attachment to work.”

With this definition, employees emotionally care about their work and their company. He further describes employee engagement as a mental state — it’s something in our heads and hearts that represents the attachment we feel to our work. The definition also includes an element of discretionary effort. “Engaged workers don’t work just for a paycheck or just for the next promotion, but work on behalf of the organization’s goals.”

However, as good as these definitions sound, they are not quite specific enough… instead, it would be better to use Wendel’s definitions as guides and add specific objectives based on your organization’s situation. These metrics might include “lower turnover by 25%” or “reduce absenteeism by half.”

2. Confusing Engagement with Happiness

As it turns out, a happy workforce is not necessarily and engaged workforce, as people can be satisfied or happy at work without being engaged. As Wendel further states, “Happiness is a current emotional state that is often related to many factors that have nothing to do with employment — the weather, family life, personality, etc.”

Without understanding the distinction between happy and engaged employees, organizations have taken a variety of paths to try to increase engagement. Some have focused on things such as dress-down Fridays (pre-pandemic), putting in vending machines with healthier snacks, or creating a work place with state of the art work-out facilities and a great latte bar. Those things might be nice — they might make for physically healthier and maybe even happier employees. But, there is plenty of evidence that these things do not increase engagement.

3. Misunderstanding the Link Between Engagement and Productivity

There is considerable research about what truly motivates people. Hands down, intrinsic motivation trumps extrinsic motivation! People are motivated primarily by an intrinsic desire to do a good job, to be recognized for it, and to be considered a valuable asset to their organization; in Deming’s words, “To have joy in work.”

Deming was very clear about how to make sure that employees have “joy” in work — by enabling them with the training, tools, and resources they need to do a good job; to listen to their ideas for improvement and to continuously improve the work of everyone.

In other words, many organizations focus only on engagement as the strategy, but productivity yields engagement — not the other way around!

“Employee happiness and morale is NOT the critical path to employee productivity. but productivity and employee achievement are the critical path to high morale and a happy work environment. Morale and employee happiness aren’t the means to the end; they are the end itself.” —Morale and Motivation Myth…No Strings Attached

By increasing employees’ productivity, you get increased engagement, and that engagement, in turn, increases productivity, and the other positive and measurable results that come from increased engagement.

4. Seeking a Quick Fix

Engagement efforts often fail because we wishfully think and hope that a few superficial suggestions and tips for increasing engagement will actually result in substantive change It’s a classic case of one of Deming’s truisms: “I didn’t say it would be easy. I just said it would work.”

There is no magic bullet for engagement. It requires fundamental culture change and that requires commitment and
the required resources. This is a culture change in which engagement is the byproduct of having everyone involved in the continuous improvement of everything!

It’s an approach we call Engagement Around the Work, as it’s all about achieving goals through people!

We call it CPI2 his method has two parts:

1) CPI – Continuous Process improvement — improving all that we do through improving all our work processes

2) CPI – Continuous People Involvement — providing the tools, resources and environment for people to be critically involved in all aspects of improvement.

Are Questions the Answer to Making Breakthrough Solutions?

questions

An article published in 2020 as part of the Drucker Forum’s “shape the debate” series raised some interesting perspectives about leadership and making breakthrough improvements.

The simple premise shared by consultant and author John Hagel is that “questions” are the answer.

“The most effective leaders of the future will be those who have the most powerful and inspiring questions,” Hagel said. “…and who are willing to acknowledge they don’t have the answers, and that they need and want help in finding the answers. It’s in sharp contrast to the conventional view of leaders as the ones who have the answers to all the questions.”

This view aligns nicely with ours, as we’ve found that posing questions of and involving the people closest to the work is the shortest path to the largest gains.

After all, where do new ideas that lead to lasting solutions come from?

They come from people… that is, if those people are asked.

Here are three different approaches to identifying new ideas and solutions along with some of the questions we might ask the right people while studying the related work:

  1. Classic brainstorming. When studying the current situation and causes does not lead directly to identifying lasting solutions, you need to elicit a number of different ideas from your team by asking questions that stimulate creativity. How can we increase our productivity by 10 percent? What are the most common obstacles causing the process to stall? What is the most difficult aspect…”

    Before you launch into your brainstorming, make sure you have convened a diverse group of people with some knowledge or interest in the problem at hand. Keep in mind that it is always easier for people to “think outside the box” when they come from outside the box.

    The classic rules for brainstorming are:
    • No criticism of ideas—no idea is too crazy
    • Go for quantity of ideas and worry about quality later
    • Brainstorm individually first and then read the ideas out round robin style it is okay to pass
    • Build on positive aspects of other ideas to create new ideas
    • Capture the ideas on flip charts or on large Post-Its that everyone can see and read
  2. Tools such as the Six Thinking Hats and Heuristic Discovery, which systematically change one’s perspective to open-up new possibilities for solving problems.
    • First, state the problem in terms of an opportunity or goal. For example, a keyboard refurbishing operation needed to increase throughput, so they would ask: “How to we double our daily throughput of refurbished keyboards?”
    • Second, create a picture or map of the problem as part of the system, labeling each of the significant components.
    • Third, describe the impact of each component as it impacts the goal. Use a question format. For example:
      • What tools might we use to increase throughput?
      • How can we make sure that people’s skills are sufficient to double the throughput?
      • How can we make sure that people’s speed is sufficient to double the throughput?
      • How can we ensure the workspace layout enhances throughput?
    • Fourth, Prioritize these and generate ideas for solutions to the component problems that are most likely to impact
  3. Imagineering perfection, which helps you surface possibilities to leap past incremental improvements…
    • “What would this process look like if everything were right?”
    • What would it mean if the input we need always arrives on time and exactly the way we need and want it—no delays, no expediting, no rework?
    • What if every step of the work process were to go exactly as it should with no waste, no rework?
    • What if our work produced exactly what the customer needs, on time, exactly as they require it all the time? What would this look like?
    • What exactly does the customer need for perfection?

Implementing a New Year Strategic Plan?

implementation

In a 2018 post we noted that an organization can have an excellent strategy but make little-or-no gains if they fail to execute effectively on that strategy.

It was also noted that this happens in a great many instances, as people at all levels frequently struggle to stay-the-course when it comes to achieving goals, keeping resolutions, or executing strategic plans. Instead, they fall prey to “working so hard on the urgent that they forget about what’s really important.”

Since we are about to begin a New Year, and since many organizations have, in fact, created a strategic plan for the upcoming year, it seems an ideal time to re-share and reaffirm the fact that “planning” does little good without execution. Fortunately, there are solutions!

The Four Disciplines of Execution, an insightful book written by Sean Covey, Chris McChesney, and Jim Huling, shares one of these solutions.

As you may know, the ‘Four Disciplines’ comprise a management system of making consistent and systematic progress on executing plans and achieving goals. An organization can have an excellent strategy but fail to execute effectively on that strategy. Almost always the reason is that everyone is BUSY, and that they experience a conflict between all of the demands to keep the business running on a day to day basis (the ‘whirlwind’) and the time required to move the organization forward to accomplish existing or new goals!

The book identifies four key elements of execution that can help any organization achieve steady progress on the strategic objectives:

The first discipline is to focus on the “wildly important” (WIG—Wildly Important Goals). It is suggested that we’re better off executing a small number of goals right instead of spreading ourselves too thin. It is also important to not only identify, but also communicate exactly what these wildly-important goals are so that everyone is working on what matters. Equally as important, each of these goals must be associated with a targeted completion date – in other words, they must be time-based.

The 2nd discipline is to set (and act upon) lead measures. While lag measures tell you whether or not you have achieved your wildly-important goals, in most cases, by the time the results are in, it’s too late to do anything about them. Lead measures are predictive; they tell you how the lag measures will move, and they are “influenceable” (you can do something about them).

For example, a person might set an important goal of losing weight. The lag measure will be to take periodic measurements of weight. But to influence the weight goal the person must act on the lead measures: exercise (calories burned) and calories consumed.

The 3rd discipline is to keep a compelling scorecard. The scoreboard shows the lead measures and lag measures defined in the first two disciplines. This scoreboard must be ‘a players’ scoreboard’ not a ‘coach’s scoreboard’. It must support, guide, and motivate the players to act effectively on the lead measures and influence the lag measures.

People play the game differently when they are keeping score, and they play differently if they are keeping the score themselves! In fact, the action of recording their own results has proved to have a strong effect on people ― fostering ownership, engagement, and a deeper appreciation of the impact of their effort.

In addition, there are four important requirements to creating an effective scorecard that will truly promote execution and engagement:

  • The scorecard must be visible. If it is out of sight, on your computer or on the back of the door, it is less effective at aligning the team to focus on moving those measurements.
  • It must be simple, showing only the data required to ‘play the game’ ― to let the players know how they are doing day to day.
  • It must show both lead and lag measures.
  • It must show “at a glance” how the team or players are doing.

The 4th discipline is to develop a “rhythm of accountability.” This is the discipline that enables you to win… without a rhythm or cadence of accountability, teams will have a much more difficult time and will tend to become less engaged. The threat, of course, is that the whirlwind of running the day-to-day business that will consume all the available time.

By setting a rhythm or cadence the authors mean an inviolable regular schedule to which everyone is committed. For example, teams should meet every week or every two weeks as opposed to “whenever something comes up.” It’s also best to schedule the meetings at the same day and time each week or every-other week. These meetings should never be canceled ― they must be viewed as important and productive, thus promoting strong feelings of belonging, commitment, productivity, and accomplishment, which are all drivers of engagement.

As noted in the book, “without accountability, the whirlwind will win!”

Like many things in life, these elements are simple but not necessarily easy… but they do enable an organization to more easily achieve important goals in the face of the whirlwind.

Four Effective Methods of Identifying Waste

identifying waste

Our previous post shared the perils of taking an “idea-driven” approach to identifying waste or opportunities for improvement. While this method often feels right, it seldom addresses the biggest problems within an organization.

Instead, one of the following four approaches can help project teams to identify the best opportunities for improvement – the ones that can yield the biggest gains:

The Goal-driven Search:
Start with the most pressing organizational goal and drill down to find the waste that affects that goal. Do you want to save time, money, improve quality, conserve capacity – what? The goal driven search for waste takes that goal and looks for any problem that affects it.

If your goal is to free up people’s time, you would then study the time to identify and prioritize every aspect that waste’s time. A work sampling study would provide you with a great deal of information about this.

If you want to free up production capacity, you would study and prioritize all the factors that waste your capacity – bottlenecks, set up times, producing the wrong thing (product that sits in inventory), yields – all the capacity spent producing product that cannot be sold, production capacity devoted to rework.

If you want to increase revenue, you would focus on identifying and quantifying the waste in all the factors that get in the way of sales, such as the use of sales reps time, selling methodology, lead generation, causes of lost sales, delays in installations or shipments, and so on.

The distinctive feature of the goal driven approach is that not all waste is treated equally. Instead of looking for waste in all its forms, this approach zeros in to identify and prioritize for removal of all the waste associated with a particular important goal.

The Brainstorming Approach:
The brainstorming approach is perhaps the quickest and easiest way to identify an extensive list of the waste in an organization. The first step is to collect a group of people knowledgeable about the work and solicit all the ideas about waste (i.e., identify waste, specify where it is, etc.)

Because the people who know most about the work identify the waste, these people are often very committed to working on improvement projects to get rid of it. This is one of the primary reasons why brainstorming is an excellent way to start an organization on a path of systematic continuous improvement.

The Work Walk-through Approach:
This method involves getting a group of people together to directly observe the work as it is done, searching for and capturing every bit of waste you can spot. It is a good idea to make sure your organization has a clear idea about “amnesty” and so that the people hard at work do not feel you are
watching for any mistakes they make. As you may know, almost all the waste in an organization is due to flaws in the system of work; management has the job of making sure the system is working well so as to minimize wasted time, materials, capital, etc.

Check-out the Process Approach:
This method of identifying waste involves creating a value map to identify inventory pileups, bottlenecks, and delays. You can then use a process evaluation tool to analyze the process and identify and quantify the waste.

You might also use a SIPOC tool to evaluate process flow. As you may know, a SIPOC diagram is a very high level process flow, identifying each key input and output of each process. The acronym SIPOC stands for suppliers, inputs, process, outputs, and customers which form the columns of the table. It was in use at least as early as the total quality management programs of the late 1980s and continues to be used today in Six Sigma, lean manufacturing, and business process management.

Watching v. Visualizing

visual management

A concept that might be a distant relative to watching our work is visual management.

When one recognizes the power of Visual Management, words seem superfluous. It is a powerful communication tool that lets people know quickly and effectively exactly the right thing to do in each situation by way of an agreed upon use of signals.

Because Visual Management highlights the critical information in ways that can’t be ignored, it enables a person to assess the status of the situation at a glance. Consequently, people can get far more done, more quickly, with fewer errors and without the need of additional instruction.

The benefits are significant! Faster response time, fewer mistakes, increased safety, higher productivity!

Visual Management has been effective in improving results in almost every organization. Among the benefits with specific examples are:

  • Speed of execution in a time-sensitive process
  • Reduced number of OSHA-reportable accidents
  • Fewer errors in production, materials management, maintenance, and office operations
  • Faster process analysis and improvements
  • Reduced inventory and fewer stock-outs
  • Higher productivity and throughput
  • Better team-work and more engaged employees

There are two types of Visual Management tools:

  1. Tools that indicate quickly and reliably what actions to take and not to take in order to maintain process control.
  2. Teamwork tools that communicate how a process is performing compared to an agreed upon standard or goal, so the people doing the work easily spot and implement the needed adjustments or improvements.

Our next post will take a closer look at each type of visual management, and share specific examples as well as best practices.