Planet Lean

As more people become interested in Lean ideas and their application to knowledge work and project management, it’s helpful to find ways that make it easier to get started or learn a few basic concepts that can lead to deeper insights later. For those that are curious about kanban in an office context, it’s not unusual to find people who are either currently using Scrum, or have some understanding of Scrum as representative of Agile thinking. One way or another, Scrum users are an important constituent of the Kanban audience. Since Scrum can be described as a statement in the language we use to describe kanban systems, it is also fairly easy to elaborate on that case in order to describe Scrum/Kanban hybrids…

read this paper…

Hi, my publisher (Productivity Press) has agreed to make Chapter 1 available for free online! If you already signed up for my book's email newsletter, you'll receive an email with information about how to download.

Otherwise, please visit my book's website here for a free registration form. I'll send the PDF out via email within 24 hours.

To purchase the full book, please visit the publisher's site or amazon.com.

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Lean Thinking Network | Competing Podcast » Archive » Competing Mark Graban

Thanks to Dwight Bowen for having me as a guest on his excellent podcast series. I chatted with Dwight about my book and the applications of Lean methods in healthcare and hospitals. Hope you enjoy the podcast.

Update on the book -- still targeted for late July, the book actually went to print a bit early. On time delivery!! (Knock on wood). I hope you also think the quality of the book is to high standards as well!



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Industry News: GM To Offer Zero-Percent Financing, Raise Prices, Screen Hummer Buyers

It's very hard to figure out what GM is thinking these days. In the first link above, the Jalopnik blog highlights an inconsistency I also noticed... it's the old laws of supply and demand popping up again. It always amuses me, in a way, that this basic law of microeconomics is even considered a "Lean lesson" because Toyota leaders like Ohno wrote about it. The basic supply and demand laws dictate the prices for just about everything -- unless you are a monopoly provider or a (obscure econ word warning...) "monopsony" buyer (meaning you are the only buyer, or one of a few buyers for an item). There's no board game called Monopsony that I'm aware of.

GM likes to flout the laws of supply and demand, as evidenced in the Japopnik post. GM says they are raising 2009 prices for the typical excuse of "rising material costs" -- the last excuse of a scoundrel. Just because your raw materials and inputs cost more, that might mean NOTHING to your buyers and their valuation of your final product. Just because flour prices have gone up (and they have), that doesn't mean people are willing to pay more for bread and pizza. It's simple supply and demand economics.

So while GM announces they plan to raise prices in 2009 (a "price rise," as they call it here in England -- ah, the small differences), they were also offering ZERO PERCENT financing to buyers recently (basically a price cut). If you're having to cut prices to spur demand, why announce you're raising prices? Because you can? Good luck with that. I'm sure we'll be treated to yet another annual story about how GM no longer plans to rely on incentives and cheap financing to move metal. Let's see what they have to do to artificially prop up the June 2009 numbers (see "robbing Peter to pay Paul.") Pulling ahead sales from future months is such a laughably short-term strategy (and old habit) .... but again, typical GM.

So while GM is bitching about price increases, they're also (guess what) still attempting to squeeze those damn steel suppliers who are (guess what) trying to increase steel prices because of... wait for it... their rising material costs!!! Yes, we are living in bizarro land. The steel suppliers are now exerting THEIR market power for a change. And I bet GM doesn't like how that feels. From a WSJ article on this:

As emerging countries increase their need for steel to build infrastructure, commercial buildings and automobiles in their respective countries, the demand for steel has outstripped supply. That has caused prices to shoot up, most drastically in the past year.

That has left U.S. auto makers, which had long dominated steelmakers during negotiations, in a weak bargaining position. For decades, U.S. auto makers were the steelmakers' most lucrative customers and bullied them into selling them long-term contract steel at discount rates.

When you bully suppliers, they want to come back to bully you when they get the chance. Shouldn't be surprising... you reap what you sow?

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The most difficult thing about sustaining a lean implementation to the point where it becomes an indelible part of the way of working is not about understanding the techniques and methods of the Toyota Production System, not about bringing people along to the new way of thinking, or bout getting sufficient education in place to understand just how much more there is to learn. The most difficult thing about sustaining a kaizen culture is simply finding the time to do kaizen every day.

Where will we find the time? As consultants, we hear this all of the time. We politely set aside this concern with conviction that there is plenty of slack within a given workday, once some customer-focused prioritizing and basic stabilization activities have taken place to replace the fire-fighting with daily management by fact on the gemba. And yet for people in the thick of the old way of working (the current or non-lean way) the reality is that time to do kaizen can be hard to come by.

This is especially true when we are given goals that seem to be in conflict: get immediate results today with the same or less resources while building long-term capability by enabling people to employ their creativity through kaizen. Lacking specific and effective mechanisms for involving people in kaizen as part of their daily work, this can create a conflict. The same resources needed to address today's problems or serve today's customers are the ones needed to make process improvements for tomorrow. Companies deal with this in various ways, typically by building up the infrastructure to do kaizen, be it a kaizen office, project teams or 5S and kaizen suggestion initiatives. But ultimately these resources are subject to being pulled away to address short-term needs and kaizen can stagnate, if we are not careful.

In the book toyota shiki howaito karaa kakushin (トヨタ式ホワイトカラー革新　Toyota Way "White-Collar Innovation") the TPS consultant, student of Taiichi Ohno and author Tetsuo Kondo relates a story from Toyota in the 1970s that illustrates this. He began studying TPS under Ohno and his disciple Kikuo Suzumura. During a particularly busy period, Suzumura visited the body weld line that Kondo was responsible for. The famously hard-hitting Suzumura scolded Kondo him because it was evident that kaizen activity had not progressed at all in the area. In response to Kondo's excuse that "We are busy," Suzumura retorted "You must feel that kaizen is a biological need, just like eating and sleeping. Otherwise you won't be creative and you can't do kaizen. Do it now!" And further, he said "If you have the will to do kaizen, the time to do kaizen emerges by itself." Reflecting on his words that it was not a lack of time but a lack of a will to do kaizen, Kondo worked until late that evening fixing various problems on the line. Thereafter he found the time to do kaizen each day with his team.

Being in the midst of a particularly busy time myself, these words from Suzumura struck home. Even without working until midnight there is no doubt we can find time to do kaizen if we have the will.

As leaders and managers, it is important to remember that we are in a position to do three things to enable a kaizen culture. First, require kaizen of all of our subordinates. The base job description within a lean organization includes doing the work and improving the work. Second, we must think together with them to positively overcome obstacles and challenges to implementing their ideas. In business it is easier for us to give freely of our wits than of our wallet. Third, we must give them the leisure to implement their creative ideas.

This notion of leisure to do kaizen comes from a quote by the poet Ezra Pound said, "The only thing one can give an artist is leisure in which to work. To give an artist leisure is actually to take part in his creation." We say that the person who does the work is the expert in that process and in a sense is the "artist" whose creativity will lead to kaizen. Leaders should think of themselves as "patrons of kaizen" just as there are wealthy "patrons of the arts." We can all do kaizen, but the more valuable contribution of a leader is to give others the leisure to do kaizen.

By Jon Miller - July 7, 2008 11:03 PM

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The Idris Jala way

A colleague of mine in the UK came back from a holiday in Borneo, talking about seeing the CEO of Malaysia Airlines on TV, talking about Toyota. How random is that? I can't find the video or story on line, but a bit of Googling indicates this might really be the case.

One article reprinted on a message board says:

Mr Idris says he is now modelling MAS on companies like Toyota, which have successfully maintained quality while reducing costs.

Said Mr Idris: "We will not behave like a low-cost carrier. We will always provide superior products and services to customers but we will drive down our cost so that we will be able to offer highly-competitive rates to passengers."

In this article ("The Idris Jala Way"), Idris and the airline have some pretty Toyota-like things attributed to them:

For one, it returned to the culture of thrift that had characterised the early years of success against the odds. Take flight turnaround times, for instance.
“If we cut that by five minutes, MAS can free one whole 737 for flights,” explains Idris.

They're also creative in ways of cutting costs... well, and they also used layoffs, unfortunately.

When passengers are a “no show” half an hour before take-off, some aircraft fuel is sucked out to save weight (a lighter plane is cheaper to fly). Full meal trays were replaced with meal boxes, as they were easier to handle, thus saving on time and staff. And there was a (voluntary) Mutual Separation Scheme, which trimmed some 2,600 workers.

If this truly was a survival situation for the airline (as it was for Toyota in the late 1940s), a fair and voluntary layoff plan may have been their only hope... as long as it was a one-time cut.

Are they "Toyota like?" I'd say "no" given the whole context of the article, even with the examples cited. But, if they are truly working on it (and can avoid relying on layoffs), they might be worth looking out for.



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1. Select a theme for each walk

2. Question the supervisors

3. Listen (and learn) attentively

4. Share what you learn as you walk

5. Write a short memo on what you learned and post it for all to see

6. Follow up to see that progress is being made

 

1. Ownership Rule - the person who first detects the problem is responsible for finding the root cause of the problem.

2. Quickly Rule - the problem must be dealt with and solved within 30 minutes, not put on a list or in a report.

3. Actually Rule - if possible play back or recreate the process that occured before the defect

4. Support Rule - the person who detects the problem has primary responsibility for solving it, but supervisor and fellow workers stop working and lend problem solving support.

5. Shut Up Rule - the discoverer is expected to solve the problem and be allowed time to dicsuss the problem and attempt to solve it.  Others can help but the supervisor or manager must keep quiet and give the people a chance to solve the problem.

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I’ve spoken extensively about the unheralded — but, arguably, the most important — Pillar of The Toyota Production System: Respect for People. Today, I want to highlight an interesting company that appears to have done an amazing job at Participative Management and in eliminating fear and mediocrity in the workplace: Semco Group.

I was first made aware of Semco Group after watching this amazing video on the MIT website. I sought to learn more about Semco and found some pretty amazing case studies such as the following:

• Harvard Business Review: Managing without Managers
• Harvard Business Review: Why my former employees still work for me
• Maverick: The Success Story behind the World’s Most Unusual Workplace
• The Seven-Day Weekend: Changing the Way Work Works
• Semco on Strategy+Business

Semco appears to have operationalized a very humane workplace and has also produced some impressive results, proving that fear and intimidation and mediocrity are not necessary ingredients to do well in the corporate world:

Reforms implemented during that time led to 65% reduction in inventories, a marked reduction in product delivery times and a product defects rate that fell to less than 1%. As the business climate improved, Semco’s revenues and profitability improved dramatically. As of 2003, SEMCO had annual revenue of $212 million, from $4 million in 1982 and $35 million in 1994, with an annual growth rate of up to 40 per cent a year. It employs 3,000 workers in 2003, as opposed to 90 in 1982.

Semco publishes and collectively live by the “Semco Survival Guide”, opting for something much simpler and thinner than a big, thick manual. Here are two points that I personally appreciate:

Our People: We avoid using terms like “employees”, “staff”, “collaborator” and similar terms. We are a team and we only have “people”. This is what we call everyone who works with us. Try as hard as you can not to use terms which are so common, but which do not express equality.

Customer Services: This is very important. Never fail to serve a customer well; do not run away from the customer, and do for the customer exactly what you would expect if you were in their position. Be honest about deadlines, prices and service conditions - never promise something you cannot deliver.

I find “never run away from your customer” an interesting thing to say — I think this point requires some reflection:

Do we — as an act of omission — run away from our customers — either in action or mentally or emotionally?

Below is their survival guide, taken directly from their website:

Leadership
We believe that organizational structure is required to ensure good business processes. However, only people who have respect for their followers can be leaders. Situational leadership will always be stimulated and respected.

Position
At the Semco Group, it makes no difference whether someone has a high ranking or a humble position. The most important thing is to always try to learn and teach new things.

Job Rotation
Whenever possible we rotate people: Some people change area and other people change business unit. This is another development opportunity offered by the company.

Freedom
There is no space at the Semco Group for formalities. The doors are always open and people should say what they really think, without worries or inhibitions.

Honesty
Everything at the Semco Group is based on trust. Whenever there is dishonesty, and there is always the possibility that there will be somebody dishonest, the company takes hard action.

Accusations
The company does not encourage people to accuse others - this should only occur when you believe you have access to concrete facts that somebody is benefiting while harming everybody else. Anonymous letters are not considered.

Gambling
No gambling of any type is permitted within the company.

Weapons and Violence
It is completely unacceptable to carry weapons inside the company. Any type of violence employed by one person against another is seen as an extremely serious event.

Unions
Unions are an important method of protecting workers. Unionization is free within the company. The Semco Group believes that constant relationships with unions are healthy for the company and the employees. The presence of union members at the company is always welcome.

You… and the Others
Based on the fact that everyone can say what they think, rumors and gossip should not be stimulated. Any attempt to harm another person is looked on very seriously. Take part and speak openly of what you are thinking in order to improve things.

Sales at the Company
The entry of salespersons to deal with personal issues is only permitted when scheduled by the interested party.

Loan Sharking
Any employee lending money to another while charging interest is considered abusive and this is dealt with by the company as a serious matter.

Discrimination
The Semco Group does not permit discrimination based on sex, colour, religion, politics etc. Everybody must have identical opportunities at the company - help to make this a reality.

Use of Authority
Many positions of the company involve the use of authority. Pressure, tactics that involve people working while afraid or any type of disrespect are considered incapable leadership and improper use of authority.

Working Hours
The Semco Group has flexible working hours where possible. This is a method of meeting the needs of each person, without harming the company.

Employee Timesheet Control
At the Semco Group, each person controls their own working hours. This is a method of transferring responsibility to each person.

Commissions
People at the Semco Group usually create commissions to deal with issues of collective interest. Take part to ensure that the commissions are active channels which effectively defend your interests, which may often not coincide with the interests of the company. Here, this conflict is seen as healthy and necessary.

Internal Promotions
At the Semco Group, people already working for the company are given preference when a new position or a promotion appears, as long as they fill the requirements for the job.

Vacations
The Semco Group does not believe that anyone cannot be replaced. Everybody must take their annual vacations, always. This is fundamental for the health of the people and the company as a whole - no excuse is good enough to justify accumulating vacations.

Recruitment
Where there is recruitment or a promotion, people in the department have the chance to interview, analyze and take part in the decision to choose the candidate.

Evaluation by Subordinates
Every six months you will fill in a questionnaire and say what you really think about your immediate superior. Be open and honest, when filling in the form and during the discussion that should take place afterwards.

Retirees
We have no restrictions on active or part-time work for retirees or people of an advanced age. Nobody is too old for us - on the contrary, we believe that experience comes with age.

Everyday Participation
The Semco Group philosophy is based on active involvement and participation. Do not sit back. Have an opinion, put yourself forward as a candidate, always say what you think - do not be just another cog in the wheel. State your opinion about everything that interests you, even if you weren’t asked for it. Be active about your feelings.

Suggestions
We want everybody to participate; opinions will always be welcome and should be spontaneous. The Semco Group does not use and is not wish to implement suggestion box programs. Whenever there is a need or interest, we can institute campaigners that encourage specific suggestions.

Dynamism
The Semco Group is normally a company that implements major changes from time to time. Don’t be scared - we think this is positive. Look at the changes without fear - these are typical characteristics of the Group.

Salary Policy
The Semco Group seeks to involve people in discussions regarding what is a fair salary for each employee. Of course, there are times when people think their salaries should be higher and the company believes it cannot pay more. What is important is to always provide an opportunity for discussions regarding this type of issue.

Strikes
The decision to take part or not in this type of event is an individual one. This is part of democracy and is respected by the company.

Personal Life
Each person’s life belongs to themselves and the personal life of each person at the Semco Group is sacred. Providing it does not interfere with the work of the environment, the company is not interested in what each person does with their own life. The human resources area is available to provide support in any area, but the company will never get involved in people’s private lives.

Former Semco Employees
Whenever anybody leaves the company, they are always welcome back - we have nothing against former Semco employees. On the contrary.

Severance
Whenever there are dismissals the company spends hours and days carefully considering the case (or cases). The company avoids dismissals as much as it can and is extremely involved in protecting justice - we must all take this line - dismissals are very serious and must be dealt with carefully by everybody.

Occupational Safety
This is not only a company responsibility. Keep your eyes open, always avoid accidents, use safety equipment even when it is bothersome - we cannot take risks with our health. Make a special effort along these lines, demand that the company do its part and do not let CIPA become a pro forma commission.

Statement of Results
On a periodic basis you’ll find out the results for your unit and for the company, and will be able to discuss them. Watch the results closely and ask any questions you want - there are no issues that cannot be discussed. Very few companies offer this - take advantage!

Profit Sharing Program
The Profit Sharing Program at the Semco Group is for real. This is a participation in which each unit wins. Each company and the Group have its own program, according to the characteristics of each business.

Relations
In order to avoid injustice or embarrassment, close relations do not work at the same unit, workplace or with the same leader, except in special cases. In completely different and unrelated locations, there are no formal restrictions.

Hourly/Monthly Workers
At the Semco Group there is no discrimination - Here everybody is a salaried worker and everybody is treated the same.

Our Personnel
We avoid using terms like “employees”, “staff”, “collaborator” and similar terms. We are a team and we only have “people”. This is what we call everyone who works with us. Try as hard as you can not to use terms which are so common, but which do not express equality.

Use of Company Resources
Do not mix company work and resources with personal services. During working hours, nobody should provide services to other people only for personal benefit, which does not stop people using a colleague’s services outside business hours, agreeing the conditions between themselves, without involving the company.

Customer Services
This is very important. Never fail to serve a customer well; do not run away from the customer, and do for the customer exactly what you would expect if you were in their position. Be honest about deadlines, prices and service conditions - never promise something you cannot deliver.

Communication
The Semco Group and its people must communicate openly and honestly. You must be tranquil and believe what is said in company notices – demand transparency when you are in doubt.

Pregnancy
Pregnancy is considered a time of great importance and happiness by the company. Never allow an injustice to be committed with one of our pregnant women – they deserve our respect and care.

Informality
Having a birthday party at the end of the working day or using nicknames is part of the company culture – don’t feel intimidated, and don’t stick to formalities.

Pride
It’s only worth working for someone you are proud of. Create this pride in the quality in what you do. Never deliver a product or service that fails to meet customer expectations, do not write a letter or communiqué that is not honest, and do not let the company’s stature fall – always fight for your pride.

Respect to Visitors
Give our visitors all of your attention and respect. Never let anyone wait more than 5 or 10 minutes. Meet everyone with courtesy, be they a supplier, customer or anyone else.

From the little I’ve seen, I’m quite impressed with Semco. If there are any that would care to chime-in on what they know of Semco — I’d love to hear about it in the comment section. Below is an interview with Ricardo Semler, the CEO of Semco.

+++++

Articles on Ethnography and Design:

1. Feature? What Feature?
   
2. Simplify The Product
3. Ask Aza Raskin
4. Aza Raskin on Poka-Yoke & The Humane Interface
5. Aza Raskin on Quasimodal Design and The ATM
6. Aza on Feature-Bloat and Site Clutter
7. Aza on Google Search Results Page
8. Aza on Cooperation and Team Size
9. Design Thinking in Medicine
10. On Designing a Watering Can for Little Hands
11. Queueing Theory and Visual Management
12. An Interview with the Inventor of “Clocky”
13. Bad Breath but Good Design
14. What is Ethnography

Articles on Leadership:

1. Overmanaged and Underled
2. Colin Powell on Leadership
3. Team or Staff?
4. Tipping-Point Leadership
5. Abraham Lincoln on Leadership
6. How to transform an Organization: Chime-in Before Buy-in

Please articles on Queueing Theory below:

• Queueing Theory: Part 1
• Queueing Theory: Part 2
• Queueing Theory: Part 3
• Queueing Theory: Part 4
• What is Waste?
• On Time-Traps and Waste
• Call Centers as Queueing Systems
• Travel Time & Waste
• Little’s Law for Product Development
• YouTube’s Queueing Properties
• Psychology of Queueing and Disneyland
• Queueing, Disneyland, and FastPass
• Multi-Tasking Leads to Lower Productivity
• Queueing Theory and Terrorism
• On Queueing Theory and Elevator Mirrors
• Psychology of Queueing, Haunted Houses, and Halloween
• The Variability Tree
• Attitude and the Psychology of Waiting - The Psychology of Queueing

Articles on Operations, lean and six sigma, please visit the links below:

• Managing Constraints Under Peak Volumes
• Order Pipeline of Events
• On Game Theory
• Applied Regression Analysis
• 5S
• Click-to-Ship Processes
• Kanban Sizing and “Pull”
• Lean at Krispy Kreme
• Theory of Constraints and Camping
• Lean for Software Development
• Don’t Waste the Customer’s Time
• Featuritis and the Focus on the Customer

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My Agile SCM co-authors Rob Cowham, Steve Berczuk, and myself have written an article for the May CM Journal on An Agile Approach to Release Management

We're relatively pleased with the article, and all collaborated together quite well.

As an organization we are still living with a slight hangover from our long history of Management by Objective (MBO).  One of the areas that this is most visible is in the mental models that we still all hold about how to bring about improvement.   This is a subject I have often brought up in the past so you can tell it is one that on a daily basis I see the organization struggling with.  I decided to write about it again this week after having conversations with several of my team members who are trying to teach leaders how to break out of the mentality that “all improvement is done in projects and most improvement is led by project managers.”

One does not need to look very hard to make this challenge visible.  One glance at our strategic plan and you can see numerous projects underway within the organization.  Most of these projects are point interventions where a small group of people have identified where a process or system needs to be added or changed and now they are working hard through change management issues to get these changes adopted by the operating units.  As you can imagine this creates all sorts of challenges including:

• Difficulty identifying cause and effect.  By taking a project as opposed to process improvement approach it is very hard to make performance visible and understand the effect improvement interventions are having or will have.
• Projects are typically point improvements that can often lead to sub-optimization, because we do not understand the impact the change will have on the entire process.
• Projects have a start and end date while the processs is always there.  Teams that get accustomed to improvement through projects often view improvement as an “addition to the job” as opposed to teams that are focused on process and the improvement of the process on a continious basis. 
• Projects are typically managed and implemented by people outside of the areas that are impacted.  This means that often there is strong resistance and little ownership for long-term sustainability and improvement.   This is a dangerous challenge for an organization, because it creates a system where only a small group of specialist are responsible for improvement.  Everyone else needs to do their job.

I am sure many of you can add additional bullets to this list.  As we move forward with and organization and teach people how to see their processes it will be important that we move away from these mental models.  This will be a long-term change…

 

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The King

Looking out

Onto the Land

In the Hot Sun

Where the Pigs are

 

 

 

 

Gemba - where to be to understand: not in the office or a conference room, but in the real place.

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Monday morning blues 'are a myth' - Science, News - The Independent

I'm going to take a bit of a "blog holiday" this weekend, since it's a holiday in the U.S. (I prefer to call it "Independence Day," not the meaning-draining "July 4th") and my wife and I are on holiday in London. Celebrating our American independence by visiting our old colonial ruler. No hard feelings, anymore, on either side!

Anyway, this article reminded me of comments I've heard our good friend Norman Bodek make a few times recently. Norman tells a story about how he always asks audiences what day of the week they like best. People hardly ever say Monday, their favorite day of the week is usually Friday. Norman say that's sad, as people should be able to enjoy their work, that Monday shouldn't be such a dreaded day.So the linked article caught my eye - is this a myth that people hate Mondays? The article reads, in part:

Monday morning blues are a figment of the imagination, according to Australian scientists, who also say Friday euphoria is a chimera too.Psychologists at the University of Sydney collected information from hundreds of locals, who were asked on which morning and evening they felt best and worst. A separate study tracked their actual mood day by day. Results were compared.The scientists found that people dreaded Monday mornings and loved Friday evenings – but only with hindsight, or when looking ahead. Their moods showed that, in reality, happiness levels varied little.

Of course, it doesn't seem like very rigorous research, based on self reporting and a few hundred people in one location. Do people report hating Mondays because of peer pressure or societal pressures? I love my work... but do I look like a geek for admitting that in a room of people who might NOT love their job?

Anyway, as Norman says, I hope you *do* enjoy your work. But, in the U.S., it's a Friday AND a holiday, so I'm sure you're loving today. Have a great holiday and a great weekend. What do you think of all this? Do people really hate Mondays? Do you?

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Everyone working together in a large room without partitions: Obeya.

Posting project team information on the wall of a dedicated ’situation room’: Mieruka: visualization

Personal Magnetism: Jinbo.  When Toyota evaluates their supervisors and managers they emphasize process performance, learning, and teaching over results, goals, and objectives.

Adhesive Strength: Nebari Tsuyosa.  Persistence and resilience are Toyota’s measure of manager performance.

Drinks with fellow workers: Nomikai. Sharing information, learning by visiting.

"Let’s Yokoten": communication is viral, literally: unfold or open out sideways.

Committees: Iinkai; every Toyota employee belongs to several.

Self organized study groups: Jishuken.

Consensus building; shopping an idea around: Nemawashi.