What is Lean Thinking?

Transcription

1 Lean Six Sigma

2 Presenter Dale Schattenkirk Director in KPMG s Advisory Services practice. He is a Certified Human Resource Professional and a Lean Six Sigma Master Black Belt. Dale has 18 years of experience in the effective application of the Lean Six Sigma process improvement methodology with numerous environments. Over the past 18 years Dale has supported organizations across Canada to achieve their goals. He has published over 70 articles on Lean Six Sigma in the public and private sector. Through the years Dale has received several independent awards such as an IPAC Lieutenant Governors Award for provincial transformation and three Industry Week Top Ten Plant Awards. 2

3 What is Lean Thinking? Lean thinking is the belief that there is a simpler, better way through a continuous drive to identify and eliminate waste, or inefficiencies and errors, in our day-to-day work. What LEAN Is Solutions to a customer s needs Identification and removal of process waste Redeployment of resources into value added activities Reduction or elimination of defects Improving process flow About doing necessary tasks Continual improvement Focusing on value added activities Quality at point of service What LEAN is Not Focused solely on provider needs Just writing new policies or procedures Job reduction Measuring quality into service Batch and queue About doing a lot of non-value added work One time random improvement Busy work that fills your day Speeding up poor processes 3

4 1950s 1980s 2000s 1920s-1930s 1970s 1990s The History of Lean 1 Hawthorne Effect at Western Electric s factory, Chicago under Elton Mayo Purpose: to determine effect of physical work conditions on productivity Changes were made to lighting, # of hours worked, length of breaks, etc. The researchers found that it was not the actual changes in the workplace that made the difference, but rather the concern about the employee s workplace and opportunity for employees to discuss the changes that took place 2 3 William Edward Deming was an electrical engineer working at the Hawthorne Factory He identified 14 points/guidelines to create a more efficient workplace, which would result in higher profits and increased profitability His work was branded as continual quality improvement The Lean philosophy is based on Deming s work Taiichi Ohno was the father of the Toyota Production System and devised the 7 wastes ( muda ) There is an energy crisis, US oil production starts to decline OPEC Oil embargo against Canada, Japan, the Netherlands, the UK and the US Major impact on automobile industry and there s a shift from larger vehicles to more fuel efficient vehicles The focus was on reducing wastes and non-value add activities and creating more efficient and effective work environments to increase productivity and profit 4 5 Lean is primarily applied in the manufacturing industry MIT (John Krafcik) rebrands TPS to Lean TQM, JIT, and many other methods start to arise Team concept starts to become a buzz word Lean is adopted by the Service Industry Need for cost reduction creates many methods to be applied 6 Lean principles are applied to the healthcare sector in the US In 2005, five hospitals begin to apply Lean in Canada 2009 other Canadian government organizations start using Lean. Today every province is using Lean in some capacity in public sector 4

5 Five Principles of Lean Value is defined by the customer Value Constantly seek out new ways of improving and perfecting your process Understand you process Value Stream How do we currently do the work to meet the VOC Pull Make or process only what the customer needs when they need it, by reacting to a trigger How can we respond to customer demand? Flow is developed so that the products or services move fluently and without interruptions through the system The steps to create value 5

6 The Eight Types of Waste: DOWNTIME Defects Over-production Waiting time Non-Utilized Talent Defects are defined by the customer. Incorrect data entry, anything that is not completed correctly the first time, lost files or records Producing things too early, Making too many copies, reports no one needs, focusing on internal work and batching tasks Waiting in a queue, waiting for approval, waiting to receive a document, waiting for IT systems to refresh Not maximizing the capabilities of the staff. People doing work that should be completed by others or not done at all Transportation Inventory Motion Excess processing Physically moving paper between departments, transporting reports, equipment, materials of any kind from one area to another Files awaiting signature or approval, excessive office materials, files awaiting completion by others, servers storing data, unprocessed s Searching for files on desktop, pens, staplers, looking for documents, carrying paper work to another process/department Adding value to a deliverable based on the suppliers perception of need. 6

7 The DMAIC Process Define Measure Analyze Improve Control Start up a project Determine the current state Identify the root cause Improve the process Monitor and retain To establish the necessary conditions for the success of the improvement initiatives To define the current state Engage the team To measure the current state through quantitative and qualitative fact gathering Create a baseline of current state Identify, statistically the key opportunity areas Decide what is on and off the table Gain organizational support to move forward To identify and develop solutions for the top priority opportunities To test if a change idea or solution will be successful in practice To utilize a structured and efficient method for putting new solution ideas into practice To transition to the new way of doing things Validate that the changes will be sustained To foster a continuous improvement environment 7

8 What is Lean Transformation? 8

9 An ideal Lean Journey Many organizations view Lean as a series of events rather than utilizing Lean as a way of working and improving on a daily basis. Most organizations are struggling with this transition Many organizations hit the wall when trying to make the transition and see their return on their Lean investment diminish 9

10 Lean Transformation building a foundation for continuous improvement Getting over the wall requires Lean Transformation building a foundation for continuous improvement Aligning the organization on set limited # of objectives across key dimensions, e.g., Service, Quality, Safety, People, Financials Providing a rigorous accountability framework with clear areas of focus and expectations Lean Transformation Equipping Leaders with a robust set of scorecards to track performance, and the business intelligence and data to support decision making Embedding a performance review and committee structure and cadence at each level Engaging and empowering frontline staff to make continuous daily improvements A relentless focus on standards and sustainability Having a management system that knits together all of the above 10

11 A Lean transformation model for high performance 1. Strategy Deployment Strategy Deployment focuses on defining True North a set of strategic priorities and cascading them across the organisation, ensuring integrated transformation support and roadmap for implementation. Key elements include: True North metrics, visual management for performance, standard work for leaders including Leader Standard Work. 2. Management Improvement System Provide support for leadership to manage and support continuous daily improvement. We will work with departments to create model cells which then act as an internal reference point for rolling out to other departments. Strategy Deployment Management Improvement System Center of Excellence 3. Centre of Excellence We will help you implement a centre of excellence, that includes a structured approach for improvement, a toolkit and the skilling up of a central team that will support the organisation to continue the journey of improvement. Capability Building Improvement Initiatives 5. Improvement Initiatives We provide implementation support and benefits realization. We will help deliver improvements through initiatives and rapid improvement events for key processes to both improve performance, build capability in staff to support continuous improvement. 4. Capability Building Fundamental to the system approach is the capability and behaviours of staff. We provide coaching, Lean training, tools and experiential learning to empower staff to make improvements. 11

12 Components of a Lean Transformation Creating a Compelling Story Set Goals Assess the Current State Lean Six Sigma Infrastructure For an organization to transform it needs a reason True North metrics must match the organizations strategy Each Lean transformation is its own journey, identify your organizations strengths and weaknesses All the tools, templates, quality boards, procedures to support the transformation Training Program Structure Candidate Selection Mentorship Structure In house or external training to build Lean knowledge and capacity Flowing from the strategy, True North, and current state assessment design a program map As with any training program having a structure selection process is important to identify the most appropriate candidates Any new trainee must have a mentor ship support system to support appropriate learning of their new skills 12

13 Components of a Lean Transformation Network Structure Sensei Savings Centre of Excellence Learning from others is important, creating a network support system to facilitate sharing Whether it is internal or external the organization should have support from someone that has been there done that As part of the infrastructure a consistent way to measure savings to the system is important An independent department that has the organization overall needs in mind Project Selection Project Tracking Reporting Evaluation Framework A standard method to identify the appropriate projects to work on An extension of Lean infrastructure and project selection a consistent way to track projects There should be a standard and schedule means of reporting Lean progress. As a program develops and grows it should be evaluated against the original plan to ensure it is achieving the desired outcomes. 13

14 Components of a Lean Transformation Communication & Engagement Leadership Training Leadership Standard Work Naming Within the organization a strategy must be in place to ensure information is widely spread and all staff engaged Leading a Lean transformation requires knowledge. The leadership group should be trained in how to transform an organization As part of the Leadership training standard work must be developed to lead the organization to achieve its goals The program should have a name, an identity for the organization (not just Lean ) 14

15 What is THE Dashboard Takt Time = Demand Cycle Time = OSE Quality = DPMO Satisfaction = Engagement Index Finance = Budget vs Actual 15

16 OSE (Overall Service Effectiveness) WHAT IT MEASURES Availability Performance Quality 80% X 50% X 90% = 36% What slows or stops the work or service from being completed? How quickly we provide our service in relation to a standard or best practice? How well we provide our service in relation to a standard or best practice? 16

17 Everything ends up being a project Budget Deficit Ensure the costs for operating the organization do not go over budget. Budget Deficit Unusually high rate of overtime Ensures the divisions budget is not being exceeded. Budget Deficit Rapid Improvement Events, PDSA s etc. Ensure the departments budget is not being exceeded Budget Deficit Ensure the work areas budget is not being exceeded Budget Deficit Lean team But when done correctly it s the RIGHT project 17

18 A Plan - Review 18

19 Approach An approach to developing an LMS roadmap is a two phase process with five steps detailed below: 19

20 Approach 20

21 Thank You

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