Continuous Improvement – how far do you go?

A colleague of mine once asked a plant manager how their CI programme was going and was amused at the reply – “Oh the CI programme? We finished that a couple of years back”

Joking aside though, it’s sometimes tempting to think that our Lean / CI “journey” should continue forever – a relentless, unending pursuit of unattainable perfection. But is that true?

Back in the 1980’s, one of the many newly discovered concepts from Japan was this idea of constantly pursuing perfection – “Chasing the last grain of rice” became a well-known phrase in business. I was at Hewlett Packard at the time and like most of the managers there was running several TQM (Total Quality Management) projects. After several years of wholeheartedly buying into the TQM philosophy (aka “drinking the Kool-Aid”), senior managers began to question this philosophy and realised that “spending 10,000 dollars to solve a 500-dollar problem” didn’t make good business sense.

That’s one reason why I often remind people not to lose sight of two of the most important tools in the Improvement Toolbox – “Common Sense” and “Judgement”.

As in many aspects of life the answer to the question is: “It Depends”.

Along with Investment, Innovation and Improvement are the lifeblood for any business wanting to survive and prosper in the long term. Overall, we need to maintain a relentless focus on improvement but we also have to apply “business common sense”, and keep asking:

How likely is it that the benefits will justify the resources required?

Can we deliver the results in a reasonable timescale?

Are the outcomes / benefits we’ve achieved “good enough for now”

As part of your PDCA cycle it’s good practice to regularly review your improvement activities, check that they’re on target, and consider whether some of them should be “culled” to make way for better projects.

For help with managing your improvement activities, please contact Andrew.Nicholson@ImproveMyFactory.com

PDCA
Continuous Improvement – How Far Do You Go?

Waste-Added Tax (WAT) – how much are you paying?

Waste-Added Tax

Waste-Added Tax

Every activity that doesn’t add Value for the Customer costs you money. Money that increases cost, reduces margin and makes you vulnerable to leaner competitors.

It’s the tax that you pay for inertia and inefficiency. And it’s the tax that keeps on taking. Every day that you aren’t implementing Lean. Every day that you lose focus on improvement. Every day that you keep on doing what you’ve always done.

With labour and materials costs continuing to rise, and customers wanting price reductions, it’s the tax that you must avoid. In fact, reducing Waste-Added Tax should be part of everyone’s daily activities.

Here’s a suggestion: show WAT as a line in your Management Accounts. Measure it, publish it, hold people accountable, set targets and apply your problem-solving process to reducing it.

 

Better, Cheaper, Faster – myth or fact?

I regularly meet people in manufacturing who still see life as full of trade-offs and compromises. “There’s no such thing as perfect”. “If it goes any faster, it’ll break down”. “We can get better material but they won’t pay for it!”. “if we turn up the speed, we’ll get more rejects”.  “If you pay peanuts, you get monkeys”. “We make the best, so we have to charge top dollar for it”. “We might be able to do it faster, but it’ll cost you!”.

Any of these phrases sound familiar? I’ve spent my whole working life listening to them. And I don’t believe any of them. Let me tell you why…

From the day we’re born, our reptile brains are hard-wired to learn about cause and effect. “Cry – get fed”. “Touch the stove – get burned”. As human beings, we’re very good at seeing these links. So good in fact that we can see links that don’t exist! And soon, many of these false links come to be accepted as true.

“You only use 10% of your brain”, “Alcohol helps you sleep” “Humans lose most of their body heat throgh their heads”. Common knowledge? Common myths, in fact.

And the moral of the story? If you’re serious about making step changes in your manufacturing performance, start with your own myth-busting. Challenge preconceptions, focus on the facts and run some experiments. Change the dialogue – “Where’s the data?”, “What’s the evidence?”, “Show me the facts”, “Humour me – let’s try it.” Many’s the time I’ve seen a machine run faster with absolutely no decrease in quality at all.

So what’s your own experience – and which myths have you helped to bust?

QCD - Quality, Cost and Delivery

QCD

 

QCD is out of date – you need CxVAR

For decades now manufacturers have measured their performance in terms of Quality, Cost and Delivery. These days that’s no longer good enough. If you really want to raise your game here are some measures you need to be thinking about:

Cx – Customer Experience. The customer’s total life-time experience of your products, services and brand. Think customer journeys, Net Promoter Score, Fault-Free Years in Service and the like. Talk with them, partner with them, have the difficult conversations, grow old together.

Value-Add. This goes to the heart of what manufacturing is all about – taking a whole load of inputs and resources and turning them into something more valuable. Value-add per employee is a critical measure of productivity. At the plant level, it’s one of the “critical few” measures, and at a national level increasing productivity is the only real way to improve living standards.

Responsiveness. Simply delivering a product “on time” (which date exactly?) doesn’t really cut it. How agile and responsive are you to customer needs? Do you know exactly what’s important to your customer? Can you flex volumes, delivery times and specifications? Do you need to offer guaranteed lead-times, short lead-times or both?

If you’d like an up-to-date, independent review of your KPI’s and objectives, contact Andrew.Nicholson@ImproveMyFactory.com

Being Busy and Being Efficient – What you Need to Do When

We’re all aware of the “Busy Fools” syndrome – high output, high costs, high stress, and high risk. When you’re up to your neck in alligators it’s tempting to just keep ploughing on, Head down, bottom up, you know that you’re wasting time and money but you hope for the day when everything “quietens down” and “gets back to normal”.

If customer service deteriorates, this might be self-fulfilling. An IT industry insider once described to me the typical cycle of a high-growth IT business – rapid growth leads to poor service, which slows growth. Service improves, the company grows, service declines, ….. and so the cycle continues.

If we can avoid this decline in service levels then we’ll need to accept that things won’t just “quieten down” and that “busy” has become the new “normal”. So we need to know what to do about it.

And businesses who are “Quiet” and “Efficient” also need to have effective strategies.

That’s why some years ago we developed this simple “Busy” / “Lean” Grid, to help business leaders understand where their business is, and what they need to do about it. Let’s have a look at each of the four quadrants:

  1. “Busy and Inefficient” – the “Busy Fools” scenario. The busier we are, the less efficient we become. Stress levels increase, service declines and productivity tails off. One of our biggest challenges (as a management consultancy and training organisation) is in persuading prospective clients to stop chopping down trees and spend some time sharpening the axe! In this situation very few business leaders have the courage to make everyone “down tools” for a week to transform the way they operate, so we need to find another way. The solution is to spend a couple of hours training staff to identify the main sources of wasted time and effort, to generate improvement actions, and to implement a prioritised improvement action plan. Pretty soon, productivity increases, stress levels are reduced and morale improves.
  2. Quiet and Inefficient” – the “About to go out of business” scenario. At this point, massive action is needed to turn around the company’s fortunes. Sales, service and efficiency all need to increase – often with little or no investment available. Fresh thinking is required, often driven by new Leadership.
  3. “Quiet and Efficient” – the “All dressed up with nowhere to go” scenario. Being Lean is all about adding value and eliminating waste. Many organisations like eliminating waste but far too few focus on increasing the “value-add”. If you find yourself in this situation then you need to get close to your customers, understand exactly what they value and are prepared to pay for, and find more and more ways of providing this. As part of our work with clients in this quadrant we focus on VAST – Value-Added Sales Techniques. In the longer term, this needs to become part of effective Supply Chain management.
  4. “Busy and Lean” – the “making it look easy” scenario, where most of our clients are! When you’ve truly embedded Lean thinking and Continuous Improvement, the rewards are very clear. Even in a recession, sales increase, margins improve and people still find time to make this month better and more efficient than last month. These World Class organisations invest broadly across the business, they innovate their products and processes, they look to inspire their employees and stakeholders and they understand “why” they do what they do.

Whichever quadrant your business is in, if you’re keen to improve contact info@NicholsonConsultancy.com. We can help you add value, reduce costs, and “work smarter not harder” – all at the same time!

How to break out of the “Too Busy to Improve” trap

Once you’re up and running with Lean and Continuous Improvement, you’re in the “virtuous circle” where you’re continuously becoming more efficient, saving more time, and investing some of that time in becoming even more efficient.

But if you’re very busy and you haven’t yet started your Lean journey, what do you do?

The biggest danger to avoid is just to “wait until things quieten down”. This approach can be self-fulfilling – but not in a good way! If you don’t improve then the downside of “being busy” can be longer lead times, higher costs and reduced performance. All of which can lead to a permanent – sometimes fatal – reduction in business as customers go elsewhere. This is often called the “busy fool” approach – putting in more and more effort, but getting back less and less benefit.

Instead, you need to get started on the virtuous circle by finding ways to “force in” about 10% of additional time and resource “up front”.

To do this, you need to do a bit more of the things you always do to increase your capacity: work some short-time overtime, cut back on time-consuming unprofitable work, bring in additional labour, contract out some of the workload, reschedule low-priority work, etc, etc.

And then you use some of that time to provide some short, sharp awareness training about Lean, non-value-added activities and the Eight Wastes. People will soon identify where the problems are, and come up with improvement ideas. Then you help the teams to prioritise their ideas and implement them. Focus first on improvements that save time and make the job easier. In no time, you’ll start getting some “quick wins”. Productivity increases, morale improves and people start to smile again.

Pretty soon, you’ll experience the unusual sensation of having time to actually stand back and think. And then you realise that the virtuous circle has begun….

If you want help to break out of your own “Too Busy Improve” trap, contact Andrew.Nicholson@ImproveMyFactory.com. Pretty soon, you’ll be getting better results with less effort. And who knows, you might even start to enjoy work and live longer!

The Number Twelve Motivator – “In the last year I have had opportunities at work to learn and grow”

Continuous Improvement applies as much to people as it does to organisations. Yet many organisations fail to understand this and to act on it. As a result, people tend to under-perform and hence the organisations they work for also tend to under-perform.

Effective Leaders understand how to get more from their people. Almost always, they challenge people to do better. And critically, they provide people with the right training, coaching, and support to achive those challenges.

Here are just a few of the many, many ways to help people to learn and grow:

Best Practice: providing opportunities to see what good looks like – perhaps in a completely different industry, sector or environment.

Peer learning: providing opportunities to work alongside colleagues from other departments or organisations

Secondment: typically a short-term transfer to another department or organisation. Maybe a one-year sabbatical?

Delegation: often a simple but very effective way to develop employees. Just make sure that you pass on some of the good stuff, not just the drudge work!

Training and Coaching: often, one of the best wayw to really understand something is to teach it to others.

Projects: typically, important long-term activities, often “above and beyond” the day job. Great for team-building too!

Just a few examples but not only do these approaches help to motivate the individual concerned, they can also provide huge benefits for the employee’s colleagues, for their boss and for their organisation. Try it!

… and if you’d like some help in developing your employees – and perhaps to create yuor own learning organisation – please contact Andrew.Nicholson@ImproveMyFactory.com.

The Number Eleven Motivator – “In the last six months, someone at work has talked to me about my progress”

This one really gets to the core of workplace motivation, since it covers some of our basic human needs –

  • the need to have objectives and goals – something to aim for
  • the need to feel that we’re making progress towards achieivng our goals
  • the need for regular feedback, to help us keep on track

Without these – aither at work or in our personal lives – it’s easy to drift and to lose motivation. Remember – “You are happy to the extent that you are in pursuit of worthy goals”.

Effective Leaders get to know their people and make the effort – however busy they are – for regular one-to-one discussions with each of them. Formally, this might be done every six months through an appraisal and review system, but more frequent one-to-one sessions (at least monthly) are perhaps even nore important.

Regular, honest, constructive feedback is vital to individual performance and motivation. In fact, most of us would rather have negative feedback than no feedback at all.

As well as reviewing performance against objectives, it’s also an opportunity to talk about career progression and to ensure that the employee’s idea of their future trajectory is realistic and generally fits with the needs of the organisation. In simple terms, we might benefit from some fast track superstars but most organisations also need a fair number of “steady Eddy’s” – committed, reliable people who always turn up on time and just get the job done.

… if you’d like to know more about objective-setting, effective feedback that works, appraisal, performance management or any other apsects of practical workplace leadership, contact Andrew.Nicholson@ImproveMyFactory.con

The Number Ten Motivator – “I have a best friend at work”

Maybe this is the only one of the Top 12 Motivators that isn’t always simple and easy to address in the workplace. In fact, one of the difficult challenges for first time managers is having to accept that they shouldn’t aim to be “everyone’s friend” at the expense of getting the job done.

That said, there are at least three things that we can aim to provide in the workplace:

  1. For new starters, a designated “buddy” who will be available for the first few days and weeks to help them find their way around. “Hold their hands until they find their feet” as one of my colleagues once put it!
  2. For the “rising stars” (and the owner or Chief Exec) an experienced mentor who can act as a sounding board and ask the right questions
  3. Regular, honest face-to-face feedback – providing in an open, professional manner some of the benefits of a “critical friend”. In other words, being prepared to challenge and to question, in the long-term interests of the other person.

So maybe we can’t literally be, or provide, a “best friend” at work, but there’s a lot that we can do in an organisation to provide many of the positive benefits of a “best friend”. And it’s also a great motivator for those taking on the role of the buddy, the mentor and the “Critical Friend”!

The Number Nine Motivator – “My fellow employees are committed to doing quality work”

When we’re surrounded by people who strive to do well, we’re often encouraged to up our own game. And the opposite is also true – if those around us don’t care about how good of a job they do, and set themselves low standards, then the rest of the team will often sink to the same low standards.

People give of their best when they’re challenged and supported. And no one was ever inspired by the prospect of being average, or “just see what you can do”.

That’s why it’s so important for Leaders at all levels in an organisation to have high expectations of their teams, and to tackle any examples of poor performance.

So maybe it’s time for you to set some stretch targets – agree one or two BHAG’s (Big Hairy Audacious Goals), expect excellence, give team members the support they need to achieve, and tackle poor performance immediately – it’s often contagious!

… and if you need some help with achieving a “One Best Way” culture or you want to know how easy it can be to manage employee’s performance, contact Andrew.Nicholson@ImproveMyFactory.com