Category Archives: Continuous Improvement

Leveraging Quick Wins!

When it comes to Continuous Process Improvement, action is what it’s all about. It matters not a bit what training you provide, slogans you use, or posters you post if you do not promptly move into action to get things done, measured, and stabilized so the solution sticks.

‘Quick Wins’ is a powerful tool for moving teams into action.

But it is more easily said than done.

What Is A ‘Quick Win’?
The key elements are right there in those two words: it’s got to be quick and it’s got to be successful. A Quick Win must be completed in 4 to 6 weeks at most, but many are implemented much faster such as in a “kaizen blitz” where a small group focuses full time on an improvement for a day or two, or half-time for a week.

Because of the speed imperative, if a solution requires a significant capital investment, it is not going to be a Quick Win.

If it requires a large team or cross-functional buy-in, chances are it will be a slow win if it succeeds at all.

Many Quick Wins do not require a formal team; often a natural work team can identify the problem and implement a quick solution. For a solution to become a Quick Win it is almost always an improvement that can be completed with the people closest to the work and with the resources close at hand.

Sometimes a Quick Win is a high value improvement executed with speed. But even an improvement with small dollar impact can have a great ROI — because the time and expense invested is so low and the organization begins reaping the benefits so quickly.

Why Do They Matter?
According to John Kotter, author of Leading Change and The Heart of Change, creating Quick Wins builds momentum, defuses cynics, enlightens pessimists, and energizes people.

In addition, and as depicted in the image above, when involved in any type of improvement or change initiative, education, promptly followed by action, yields motivation, and success inspires success. Theoretical opportunities and methodologies are meaningless until a person starts to see the possibilities through real-life hands-on process improvement.

Conclusions?
So a Quick Win is a shot of adrenalin for a Continuous Improvement culture. The people involved get a great deal of satisfaction from making the work more effective, more efficient, or lower cost. Their effort pays off, and pays off quickly.

Plus, they are more inclined to look for another such improvement. The people who see or hear about the Quick Win are often inspired to begin looking for their own Quick Wins as well!

Ultimately, the motivational value of a Quick Win makes the return on the effort even higher.

The Ohno Circle: Watch & Learn!

circle

The most important responsibility a manager has is to continually improve the system of work so his or her people can work more effectively and efficiently, producing higher quality and greater value for the customers. We surface and eliminate the waste in a variety of ways, asking people close to the work for their input, studying how other companies have achieved improvements, bringing in consultants and studying journals.

However, the most effective and least expensive process improvement method may be the simple method of looking and thinking about what you see.

For example, a small team of professionals was asked to determine how to fix the problems with a multi-million-dollar robotics line. This robotic line was designed to prevent stock-outs and excess parts inventory on the assembly line by using bar-coded totes, an overhead conveyor belt, and scanners and switches to send a new tote of replenishment parts to exactly the right workstation.

When a tote was emptied, it was placed on the return conveyor and when the return scanner read the barcode, the tote number would be captured. The scanner would record the emptied tote numbers, and every three minutes this list would be transmitted to the inventory software. Inventory would be decremented for workstations that had been assigned that tote number and a replenishment order would pop up at the material handling station.

The system failed so miserably that the supervisors had to take a complete physical inventory at the start of every shift to correct the inventory records.

The improvement team spent several weeks conducting interviews and studying the floor layout diagram, the process flows, and the computer code to crack a mystery that, as it turned out, could have solved in 20 minutes using the ‘Ohno Circle’ method.

As you may know, Taiichi Ohno is credited for much of the thinking behind the Toyota Production System, and he invented a novel method of making improvements. He would go to where the work was being done, draw a chalk circle on the floor, and stand in it.

He would stand for hours, watching and thinking about what he was seeing. He would look for what was getting in the way of people creating value and he would study the situation to determine what was causing it. This gave him the insight he needed to make lasting improvements.

Of course, the team of problem solvers had toured the line, but while they had looked, they had not watched. If one or more of them had stood in one place long enough to watch carefully, they would have seen the returned totes drop off of the return conveyor and nest one inside another. The next minute, they would have seen someone take the newly dropped empty tote from the top of the stack and use it for the next order. The material handler would key in the tote number, the new workstation destination, and the part numbers being sent there and send the tote on its way — often less than a minute after the tote had dropped off the return conveyor.

That is, the observers would quickly have realized that the tote re-use process was too fast for the information flow — which reported the list of emptied totes only once every three minutes.

Whenever a tote was reused before the list was sent, the inventory of the new workstation would be decremented instead of the inventory at the workstation that had returned the tote. With this insight, the problem was easily solved — change the frequency of the systems updates or change the return tote process so that no totes were refilled within 3 minutes of dropping off the belt. The latter was the easier solution, and a poka-yoke was quickly implemented to make it impossible for a recent tote to be selected and keyed in.

A little bit of watching can tell us a lot.

Increasing Customer Satisfaction

Dr. Deming

There are a variety of approaches to hearing the Voice of the Customer, a voice with which we should be very familiar!

Consider that we can know all there is to know about our internal processes and still not know enough about them to increase client satisfaction. For this sort of challenge we need additional tools and methods.

Customer Surveys are a staple for measuring and possibly surfacing areas for improvement. A popular tool for measuring customer satisfaction is the Net Promoter Score. Studying variation in the Net Promoter Scores (NPS) by area, customer type, and over time can help pinpoint trouble spots that are impacting customer satisfaction.

Analyzing customer Complaint Logs can help identify and address the problems that customers have identified and shared, but this is a bare minimum in the effort to increase customer satisfaction. The Complaint Log is a place to seek information about where we are falling short on what the Kano Model calls “Must-Be Quality.” The absence of the quality dissatisfies even though the presence in itself will not please the customers because it is assumed. Addressing gaps in the Must-Be Quality can lift one out of the hole, but will never lift customer satisfaction any further.

To effectively increase customer satisfaction, we need to create and deliver work that will delight the customers. One client described his method as the Ambassador Visit: “I go to meet with the customer, I say thank you for your business, and then I shut up. And listen.” Providing a good forum and opportunity for the customer to express what they like and don’t like is very useful. What’s more, the Ambassador Visit provides a forum to discuss what the customers see coming down the road, so we can proactively anticipate and address their needs.

Another client finds tremendous value in visiting clients as they work with the product — meeting them in the field to watch, listen, and study the customer’s challenges and how the product currently helps them — and how it could help them if something were to be changed. This approach, sometimes called Contextual Inquiry, provides value in understanding what is truly working as expected for the customers and how we can solve problems for the customers that they did not even think to mention.

Regardless of which or how many of these tools we might use, we might also keep in mind, on a daily basis, Dr. Deming’s frequent quote, “Quality is for the customer.” He also reminded us, “No customers, no orders, no jobs!”

Using Flow Charts

Often we have a process through which we want to increase the throughput or output without adding resources. In these situations a Process Flow Chart or Process Evaluation Chart is an excellent tool to start with.

A Process Flow Chart or Process Evaluation Chart (the latter is populated with measurement data) can be created by bringing together the participants in the process and mapping it out together. Some organizations believe that mapping the processes with the frontline associates always results in lightbulbs going on and the associates voicing concerns and ideas once their process is on the wall.

There are always surprises, they find ‘black holes’ or dead ends, see the ‘wastes’, waiting and handovers get visible and they learn what the other ‘swim-lanes’ (teams or team members) do and how what they do impacts others and vice versa. They always start to create action logs based on the concerns/ideas and they serve as the basis for the improvement project.

Another approach is to start with observation. Follow the process, observe the work and gather what data is available about the current process. This can be compiled into a draft of a flow chart to bring to a meeting with participants from all areas of the process under study. At this meeting, the group goes through the draft, discussing, adding to, questioning, and correcting the draft to better reflect reality.

Below is a graphic summary of flow chart symbols and their meaning:

Retaining Talent Through Engagement

Continuing the theme of “retaining talent” from our previous post, we have found the combination of productivity and engagement drives many things, including employee retention.

In reality, and like most things in business or in life, it’s the ongoing execution, work, measurement, and improvement projects (which sounds remarkably similar to Deming’s Plan—Do—Study—Act cycle) that will yield better performance results as well as higher levels of employee engagement.

In fact, we have found engagement can be a bi-product of productivity, as opposed to the other-way-around, which is the more accepted ‘conventional wisdom’ opinion.

Thus, it is by taking a formalized approach to creating a workplace culture that is linked with team productivity, performance, and job satisfaction that an organization will achieve the fore-mentioned levels of performance gains, engagement, and talent retention.

In a white paper shared in the past, we described an approach that aligns nicely with the ISO 10018 People Involvement and Competence guidelines. It incorporates Continuous Process Improvement (CPI) as well as Continuous People Involvement (CPI), so we call it CPI².

ISO 10018 and the concept of CPI² will require a formalized plan for improving the work and the workplace… a formalized plan for helping people to achieve higher-levels of productivity and job satisfaction, which will yield better business performance as well as the “skyrocketing” levels of engagement we all strive to attain.

To achieve optimum results, a system for gathering, synthesizing, and analyzing data must be developed, followed by a rigorous method of priority-setting to decide what to work on.

People at all levels must be involved; they must be educated, empowered, and engaged so that the concept of improving both their work and their workplace becomes cultural, and so they become emotionally-invested in their work and workplace.

Supporting this perspective is research conducted this past year by Dale Carnegie and MSW Research, which revealed that although there are many factors that impact employee engagement, there are three key drivers:

  1. Relationship with immediate supervisor
  2. Belief in senior leadership
  3. Pride in working for the company

Recognizing these drivers as “targeted outcomes” is a good first step for business leaders who would like to initiate and document (a-la ISO 10018) a formalized approach to engaging people into their organization’s quality and improvement system.

Tough Problems v. Tough-to-Implement Solutions

Continuing with our previous post’s theme of problem solving, business leaders often find themselves with these kinds of difficult decisions: significant problems or opportunities versus proposed solutions that cost too much, take too long to implement, or carry adverse unintended consequences of their own.

Here are some examples:

  • A large chemical company had opportunities to increase sales by $60 million if they could expand production capacity, but the capital investments would cost $20-$30 million and would take 18 months to implement.
  • A data processing company received too many complaints about quality but the market and margins would not bear additional costs for ‘QC.’
  • The manufacturing company needed to cut raw material costs without weakening its suppliers.
  • Breakthrough technology that cost too much to be commercially viable.
  •  Centralizing the Purchasing function had reduced responsiveness and efficiency but when it was decentralized, it lacked sufficient controls and access to expertise.

In most problem solving situations, the first idea is the barrier to the second idea. Steve Jobs hit the nail on the head, observing, “When you first start off trying to solve a problem, the first solutions you come up with are very complex, and most people stop there.”

In every example cited above, the people working to solve the problem had stopped at the first idea. Once an idea was developed the attention shifted toward evaluating the return on investment and lining up support rather than improving or replacing the idea with something better, faster, less expensive, or more effective. They stopped too soon!

The best idea is almost always hidden somewhere behind the first idea. In order to arrive at the best idea, you have to keep going. As Steve Jobs observed, “… if you keep going, and live with the problem and peel more layers of the onion off, you can often arrive at some very elegant and simple solutions.”

What’s the Problem?

Problem

Few decisions have a greater impact on the likelihood of success of an improvement project than the definition of the problem.

Stephen Covey says that the way we see the problem is the problem.

Albert Einstein warns that we cannot solve problems at the same level of thinking with which we created them.

The way we define and communicate the problem the team is expected to solve will greatly influence the speed and efficiency with which a team will complete its work, the degree of satisfaction between the team and the project sponsor, and the efficacy with which an organization prioritizes and sequences the problems to devote resources to.

Consider these different approaches to defining the same problematic situation:

  • Order fulfillment is too slow and is costing us a lot of business.
  • Our lost sale rate has increased from an average of 125 per month over the previous six quarters to 190 per month this quarter.
  • Our Order-to-Delivery timeline has increased to 60 days due to a bottleneck in packaging.
  • Profits are down.
  • Sales has missed their target for the past three months.
  • Packaging is too slow due to old equipment.
  • Order-to-Delivery time from the Mid-western plant in Q3 increased by 15 days over the same quarter prior year, and was cited as the cause of 42 lost sales in Q3 impacting revenue by $270,000 in the quarter.

Some of these are statements of fact, while others are judgments. Some are very broad, and others are very specific. They may ALL be valid observations about the same situation, yet the problem-solving efforts they would guide would differ greatly in urgency, efficiency, and efficacy.

Developing a good problem statement at the start will help you define and lead an improvement project that most efficiently arrives at better results.

Four Practices That Lead to Better Results
A good problem statement is not rocket-science, but simply requires some solid pre-work, thoughtful consideration & discussion, and the restraint to avoid speculating before the analysis. If you follow the four basic guidelines for problem definition, you will greatly improve the chances the right problem will get solved for good.

  1. Write It Down. If the problem is not written, shared, and discussed, all participants will feel comfortable that everyone is on the same page about the problem they are trying to solve. Such will not be the case, and the blissful ignorance about their different expectations will eventually give way to a combination of bewilderment, conflict, frustration, disappointment, and a great deal of inefficiency.

    Organizations can avoid the problem-solving frustration and rework by surfacing right up front any different views of the problem they are trying to solve. The best way to surface and discuss any differences is to write it down and discuss it with all participants, to ensure it is well understood and agreed to. In addition to getting everyone on the same page, only a written problem-statement can be tested against the next three qualities necessary to effective problem-solving teams.
  2. Include a Quantification of the Waste the Problem is Causing. Yes, this means you have done some pre-work, because no problem statement is as effective as it should be if it does not indicate why we care.

    Quantifying the waste makes certain that the organization does not invest scarce resources on something that will not have a significant impact. Every organization has more opportunities for improvement than capacity to execute on the improvements.

    Quantifying the waste also helps elicit the urgency and support that the project merits. A problem statement that is “…costing the organization $18,000 each week in excess charges” will receive more urgency than a problem “…costing the organization $800 a week.” And problems for which no discernable and measurable impact can be found probably should not receive much urgency at all. Quantifying the waste in the problem statement helps an organization make sure that they are working on first things first.

    The statement of impact best fits at the end of the problem statement but identifying and quantifying the waste should come at the start of the problem definition process. If we cannot reasonably measure the impact a problem is having on an organization, we cannot reasonably prioritize the effort.
  3. Be specific about the metric you are using to size the problem. Malcom Forbes once observed that “It’s so much easier to suggest solutions when you don’t know too much about the problem.” The rub is that you will have a hard time determining if your solutions are effective.

    To avoid this pitfall, your problem statement should incorporate the measurement you expect to move the needle on, the current baseline for that metric, and both the time and the place that your baseline measurement was taken.
    • The metric: If order-to-delivery timeframe is our problem, the problem statement should be a factual statement of order-to-delivery times. Maybe order-to-delivery times have deteriorated or maybe they have always led to lost orders. Either way, a recent measurement of order-to-delivery times must be part of the problem statement if this is the problem you intend to solve.

      For example: “order-to-delivery times have grown to 6 weeks and was cited as the reason for 25 lost orders last month.” A description such as “too long” is too general, but teams may be tempted to substitute this judgment instead of a metric because a recent measurement is hard to get.

      Bear in mind that if the problem is too hard to measure up front, chances are it will be too hard to measure later on when the team needs to evaluate the efficacy of the solution. Even if the team can gather measurements later, they will have no baseline with which to compare the new results.
    • Timeframe: When have you observed the problem? Is your metric from last week, last month, last quarter, or last year?
    • Scope: Where are you seeing the problem? Does the metric describe what is happening at one plant or all plants? Is it one product, a product family, or all products? By making the problem statement factual and specific about what observable phenomenon we saw when and where, we create for the team a clear and effective baseline against which to measure improvements.
  4. Omit Judgments and Opinions about Underlying Causes. Maslow observes that “If the only tool you have is a hammer, you tend to see every problem as a nail.” We all have biases, and when we make assumptions about the underlying cause, we bias the process to overlook other possible causes.

    In theory, this could be a time-saver — if you hit upon the correct root cause. However, in our experience this rarely happens. Making assumptions about the causes almost always makes a problem more difficult to solve instead of easier to solve. This is because if one or more important underlying causes are overlooked by the bias introduced in the problem-statement, the problem will not be solved before the project goes through quite a lot of rework.

    Most people have some sort of bias or hunch, slight or strong, about possible underlying causes of most problems and they will consider these first.

    For example, some people easily incline toward thinking that the technology is not what it could or should be and theorize that this is the cause of most of the problems they encounter. Others are quick to suspect that the incentives are misaligned. And still others may speculate first that processes are not sufficiently defined and adhered to. These hunches are developed based on experience and people with diverse experience and biases tend to serve a project well.

    However, no matter how confident in the theory about the root cause, inclusion of an assumption about the cause or the solution in the problem statement is more likely to impede results than accelerate them. A hunch makes an excellent servant (in the problem analysis phase of the project) but a poor master. Leave any comment about possible underlying causes out of the problem statement.

    If you follow these four guidelines, your project will have a much better chance of arriving at, implementing, and validating an effective solution that produces lasting results.

Why Quantify

quantify

When engaged in Continuous Improvement (CI), a key objective is to identify, quantify, and eliminate waste.

People often ask why it is so important to quantify the waste – and the answer is straightforward: quantifying the waste does three things for you.

  1. First, it helps you distinguish between the “big‐hitters” and the nice‐to‐have improvements so you focus on the most important opportunities first.
  2. Second, it makes the organization aware of the cost of a delay in tackling a ‘big‐hitter’. If a problem is wasting $5 million a year, every week of delay is wasting nearly $100,000, so the organization wants to make sure nothing slows this improvement effort.
  3. And third, quantifying the waste enables you to have more meaningful discussions with other parts of the organization whose support you need to change the processes that cause the waste.

If you’re wondering about how to go about the process of quantification, here are three simple guidelines:

  1. Identify if and how the problem affects the four forms of waste: lost sales, material costs, time, and capital costs. If the problem causes delays, think through and estimate the form of waste that the delay results in. Does it increase capital such as inventory or receivables? Does it delay sales and revenue? Does it cost you customers and future business? Does it require additional people time? Many problems will affect more than one of the four forms — lost sales, material, time, and/or capital. For example, excess inventory not only ties up capital, but may increase the number of people who need to manage it, the warehouse costs to store it, and the probability of scrapping it. All these factors can be reasonably estimated with some historical data and getting close enough to the work.
  2. Quantify the impact, recognizing that assumptions and estimates will probably have to be made. If you have or can gather data, use the data and document where you got it. If you must use assumptions or estimates, document how you came up with that — who did you talk to? Perhaps document a range that you are pretty confident about.
  3. Do the math to roll it up into annual dollars.

Look for the “No!”

look for the no

As the saying goes, “With experience comes wisdom… and confirmation bias!”

As you may know, confirmation bias is the tendency to pursue and embrace information that matches our existing beliefs. Human nature encourages us to seek out and enjoy people who write or say exactly what we think, and we often gravitate toward these sources not for information but for confirmation.

Naturally, this can be dangerous when engaged in CI or other problem solving efforts!

When we find ourselves feeling overly-good about an opinion or conclusion, a better course of action, and one that aligns with ‘critical thinking’ best practices, is to make every effort to “prove ourselves wrong!”

In other words, consider alternatives. Or, as philosopher and journalist Emile Chartier Alain put it, “Nothing is more dangerous than an idea when it’s the only one you have.”

Here are five suggestions for avoiding the “confirmation bias” pitfall:

  1. Don’t Believe Everything You’re Told; the 1st step is to consider more than one point of view – “prove yourself wrong!”
  2. Don’t Believe Everything You Think
  3. Ask Questions
  4. Research Deeper
  5. Evaluate Your Work

Ten Key Questions for Optimizing Our Continuous Improvement Effort

One of Bill Conway’s favorite sayings is, “The most important business decision people make every day, is deciding what to work on….”

While at first glance this might seem a simple questions, upon reflection most of us will realize it is not necessarily an easy one to answer.

Possibly the following ten questions can help us move forward in a fashion that enables us to get the most out of our improvement efforts:

  1. What should we work on?
  2. What process should we use to decide what to work on?
  3. How should we prioritize?
  4. What is our “readiness to change?”
  5. What do we do now?
  6. What do we do next?
  7. How do we go about it?
  8. Which tools will best enable us to achieve goals?
  9. Which methods will best enable us to achieve goals?
  10. How can we increase alignment?