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Staying Lean - Thriving, Not Just SurvivingProfessor Peter Hines, Chairmanwww.LeanBusinessSystem.com
Muda Mura & MuriMuda, Mura & Muri
Muda (Waste) Mura (Unevenness) Muri (Burden)
LeanBusinessSystem.com 2011
Top 10 Reasons for FailureTop 10 Reasons for Failure
1. Lack of a clear executive vision.
2. Lack of an effective communication strategy.2. Lack of an effective communication strategy.
3. Failure to create and communicate a real sense of urgency.
4. Poor consultation with stakeholders.
5. Lack of structured methodology and project management.
6. Failure to monitor and evaluate the outcome.
7. Failure to mobilise change champions.
8. Failure to engage employees.
9. Absence of a dedicated and fully resourced implementation team.
10. Lack of sympathetic and supportive Human Resources policies.
Source: Lucey, Bateman & Hines, 2005
Kaizen Blitz vs Lean ManagementKaizen Blitz vs. Lean Managementyy
Opp
ortu
nity
Opp
ortu
nity
Greater, sustainedresults achieved
vem
ent O
vem
ent O Improvement leveled off and
eventually stopped due to lack of realizing “true” lean
Impr
oIm
pro
Short termgains made
Lost and repeated results due to no sustainability
opportunity
gains made
Results could be lost entirelyResults could be lost entirelyif organizational structure not
aligned to support and education level of all employees not increased.
TimeTimeAwareness, education, organisation structure
created to support lean Source: C. Craycraft, Whirlpool
Sustainable Lean ManagementSustainable Lean Management
Lean Management
Source: P. Hines, P. Found, G. Griffiths & R. Harrison, Staying Lean, 2008
Staying Lean 2008
Cogent Power Case
An urgent need for changeAn urgent need for change
• Substantial Pre-tax losses in 2003 from Global operations
• Business was losing cash from a number of it’s Operating Plants – Seven Global Operating units
• Relatively Static order book with emphasis towards lower margin products
• New CEO put in place to Lead the business TURNAROUND strategy• New CEO put in place to Lead the business TURNAROUND strategy
• Experienced Senior Management Lean Team appointed to support
Staying Lean 2008
Internal Value Stream FocusInternal Value Stream Focus
Materials, People, Machinery, Resources
Materials, People, Machinery, Resources
Materials, People, Machinery, Resources
Materials, People, Machinery, Resources
Materials, People, Machinery, Resources
IRON OREIRON ORE
TRANSFORMERTRANSFORMERTRANSFORMERTRANSFORMERCORE & WINDING CORE & WINDING
SLIT COILSLIT COILSLITTINGSLITTINGSTEEL COILSTEEL COIL
STEEL SLABSTEEL SLAB
TRANSFORMER TRANSFORMER IN SERVICEIN SERVICEASSYASSY
STEEL CORESTEEL CORE
Materials, People, Machinery, Resources
Materials, People, Machinery Resources Materials People
Materials, People, Machinery, Resources
The Roadmap to sustainability
R d 1Roadmap 1
Lean Iceberg Model
Technology, tools and techniques
Supply chain integration4
ProcessmanagementABOVE WATERLINE - VISIBLE
UNDERWATER - ENABLINGABOVE WATERLINE - VISIBLE
UNDERWATER - ENABLING
3
Strategy and alignment
Leadership
Behaviour and engagement2
1
Launched
g g2Source Hines, Found & Griffiths, Staying Lean, 2008Source Hines, Found & Griffiths, Staying Lean, 2008
Jan 2004
Staying Lean 2008
Roadmap 1Roadmap 1
Strategy Formation and Deployment
• Leadership Structure confirmed and aligned to the Turnaround• Kicked-off with Top Level Awareness & Strategy Sessions• International & Regional Management Teams CSF’s & K P I’s• International & Regional Management Teams – CSF s & K.P.I s• Lean Message Communicated from the TOP – To help Deployment
Staying Lean 2008
Roadmap 1People Skills and Value StreamPeople Skills and Value Stream Management
• Selection Process to ensure that the RIGHT Coaches chosen• Extensive Lean Coach Programme – theory and practical• Lean Coaches developed hands-on experience in Tools• Steering Team Meeting and Best Practice Sharing Events
Staying Lean 2008
Roadmap 1Roadmap 1Internal VSM and Lean Toolkit
• Visual Impact with 5S, TPM & SMED at all sites• High levels of engagement with site cross-functional teams• Process stability being used to help introduced PULL systemsProcess stability being used to help introduced PULL systems• GOLD STAR standards using 6 Sigma set for heavy industry
Staying Lean 2008
Roadmap 1B i C t V l dBasic Customer Value and Office Lean
• Customer Value assessments for all businesses• Sales Acquisition Mapping used to improve order creation process• Office 5S used to improve sales requisition process time• Lean Tools and deployment evident in many support areas
“Value Criteria” Rank Product XX Performance Vs
Your Expec tati ons Our Competi tors Your bes t Other Supplier
Better than
Same as
Worse than
Better than
Same as
Worse than
Better than
Same as
Worse than
Responsiveness 4
Price 5
Quality of people 1
Innovation 2
Lean Management Training GG v 1.2 ppt© S A Partners 2005
Expertise in subject areas
3
Staying Lean 2008
Maturity AssessmentMaturity AssessmentBusiness to business benchmark
Lean Iceberg Model
Technology, tools and t h i
Supply chain integration
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Stage 4
Stage 5Way 0f Life
1 Autonomous Habit
Processmanagement
techniques
Strategy and alignment
NE - VISIBLENABLING
ABOVE WATERUNDERWAT
integration
Stage 2
Autonomous
Stage 3Deployed
1 Autonomous Habit2 Full Empowerment3 External Learning
1 Driven Deployment 2 Majority Involvement3 X-Process learning
gy g
Leadership
Behaviour and engagement
Stage 1Reactive
Stage 2Formal
1 Formal Structure2 Only Specialists3 Team Learning
Key Characteristics1 Ways of Working
1 Goal Orientated2 Selected Teams3 Value Stream Learning
1 Reactive Approach2 Little/No involvement3 Adhoc Learning
3 Team Learning 1. Ways of Working2. Employee Engagement3. Learning Best Practice
Staying Lean 2008,
Organisational LearningOrganisational LearningLean Maturity Assessment
100EXPECTED
CE
WHY?
FOR
MAN
C WHY?
PER
F
ACTUAL
TIME0
TIME
Staying Lean 2008
Organisational LearningOrganisational LearningLean Maturity Assessment
• The Coaches have become the LEADERS of LEAN
R l LEAN MANAGEMENT i ill i• Real LEAN MANAGEMENT is still an exception
• LEAN is too cosmetic and NOT fully impacting profit
• LEAN still seen as an initiative and NOT given priority
OEE and Pareto are hardly used to drive improvement• OEE and Pareto are hardly used to drive improvement
• LEAN is NOT driving changes in management behaviour
• Responsibility and accountability NOT fully deployed
Staying Lean 2008
Early Lessons: Below the WaterlineEarly Lessons: Below the Waterline
Unstable Iceberg Model
Enabling
Technology, tools and techniques
Supply chain integration
Enabling Features Not
Fully Addressed
ABOVE WATERLINE - VISIBLE ABOVE WATERLINE - VISIBLE
ProcessmanagementABOVE WATERLINE - VISIBLE ABOVE WATERLINE - VISIBLEg
UNDERWATER - ENABLING UNDERWATER - ENABLING
Strategy and alignment
Behaviour and engagement
LeadershipNARROWING UNDER WATERLINENARROWING UNDER WATERLINE
g g
Source Hines, Found & Griffiths, Staying Lean, 2008
The Roadmap to Sustainability
Roadmap 2
Lean Iceberg Model
Technology, tools and techniques
Supply chain integration4 5
Processmanagement
techniques
ABOVE WATERLINE - VISIBLE ABOVE WATERLINE - VISIBLE
integration
3
Strategy and alignment
Leadership
UNDERWATER - ENABLING UNDERWATER - ENABLING
21
Re ie ed
Behaviour and engagementSource Hines, Found & Griffiths, Staying Lean, 2008
ReviewedJuly 2005
Staying Lean 2008
Roadmap 2M lti l l L d hi dMulti-level Leadership and Deployment
• Leadership developed at EVERY level of the organisation (7 Values)• Clearly defined roles and behaviours for self-managed teamworking• Re-deployed targets aligning OF / OC / NPI ProcessesRe deployed targets aligning OF / OC / NPI Processes• Full ‘line of sight’ deployment locked into key processes
Staying Lean 2008
Roadmap 2Roadmap 2Lean and the Extended Enterprise
• Focus on sustained profitability in strategically selected areas• Operational performance metrics focus on key value streams• Aligning supplier and customer processes via ‘CAMBAN’ technology• Operational capability now leading to sales growth opportunities
Taux de service de (Somfy)au de se ce de (So y)
40%
50%
60%
70%
80%
90%
100%
taux
0%
10%
20%
30%
Jan-03
Feb-03
Mar-03
Apr-03
May-03
Jun-03
Jul-03
Aug-03
Sep-03
Oct-
03
Nov-03
Dec-03
Jan-04
Feb-04
Mar-04
Apr-04
May-04
Jun-04
Jul-04
Aug-04
Sep-04
Oct-
04
Nov-04
Dec-04
global objectif
global 72% 100% 92% 60% 47% 85% 67% 67% 56% 20% 25% 10% 24% 61% 76% 76% 75% 83% 100%
objecti f 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Jan-03 Feb-03 Mar -03 Apr -03 May-03 Jun-03 Jul -03 Aug-03 Sep-03 Oct-03 Nov-03 Dec-03 Jan-04 Feb-04 Mar -04 Apr -04 May-04 Jun-04 Jul-04 Aug-04 Sep-04 Oct-04 Nov-04 Dec-04Smal Coil 117,5 mm (M940-65A ISOL 20)
200,000Obergrenze
60 000
80,000
100,000
120,000
140,000
160,000
180,000
Bes
tand
pro
Tag
in k
g
Untergenze
Bestand pro Tag
0
20,000
40,000
60,000
19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41
Datum
Staying Lean 2008
Roadmap 2Customer Value and SupplierCustomer Value and Supplier Integration
• Detailed Customer Value extending throughout the Supply Chain• Adapting process to meet with customer and business needs• Product / Process Development exceeding customer expectations• Product / Process Development exceeding customer expectations• Extending the offering and bridging the gap in the Supply Chain
Strategy Formation & Deployment
Products
VOC Insight Survey Folllow-up Opportunities
Steel Makers
g y p pp
05
10152025
Engi
neer
ing
Del
iver
y/Le
adTi
me
Sale
sC
omm
unic
atio
n
Invo
ice/
Pkg.
Pric
ing/
Cos
ting
Lean
Mis
c
Services Direct VOC Feedback Action Plan Customer Labels
12th International Symposium on Logistics
Transformer Makers
Staying Lean 2008
Lowering the Water LevelLowering the Water Level
Staying Lean 2008
Lowering the Water LevelLowering the Water Level
Staying Lean 2008
Lowering the Water LevelLowering the Water Level
Staying Lean 2008
Key Lessons: Integrated IcebergKey Lessons: Integrated Iceberg
Below the waterline Above the waterline
AlignedStrategy
DeployedLeadership
ProcessDiagnosis &Management
TechnologyTools &
Techniques
Behaviour&
Engagement
Below the waterline Above the waterline
Sustainable LeanManagement TechniquesEngagement
ProcessDiagnosis &Management
TechnologyTools &
Techniques
Behaviour&
EngagementDoing the wrong things right
DeployedLeadership
AlignedStrategy
ProcessDiagnosis &Management
TechnologyTools &
Techniques
Behaviour&
EngagementLack of vision and inspiration
g g
AlignedStrategy
DeployedLeadership
ProcessDiagnosis &Management
TechnologyTools &
Techniques
p
Unrealised human potential & habit
AlignedStrategy
DeployedLeadership
TechnologyTools &
Techniques
Behaviour&
EngagementSub-optimised & narrow CI
AlignedStrategy
DeployedLeadership
ProcessDiagnosis &Management
Behaviour&
Engagement
No incremental or step improvement
Staying Lean 2008
Lean Maturity and OrganisationalLean Maturity and Organisational Learning
KnowingOrganisation
UnderstandingOrganisation
ThinkingOrganisation
LearningOrganisation
McGill & Slocum
Double looplearning
PushLean Pull
men
t
Single looplearningSenge
Lean LearningLean
Ach
ieve
m
Step change in learning occurswhere the organisation can achieve higher results than previously imagined due
Ad-hoc FormalGoali t d
Managed Way of Life
A higher results than previously imagined due to lack of knowledge of what was possible
Bessant & Caffyn Ad hoc Formal oriented Autonomy Way of Life& Caffyn
LeanBusinessSystem.com 2011
Further InformationFurther Information
• You can reach Peter at:P t Hi @L B i S t– [email protected]
O S• Or visit him at www.LeanBusinessSystem.com
• For a full video on Staying Lean see: http://www.leanbusinesssystem.com/en/LBS%20Product%20Repositories/Master/KnowledgeAndResources/Webinar13StayingLean