Introduction to LEAN (for Leaders) March 2 nd, 2018 Ian Marshall Lean Champion Canadian Manufacturers & Exporters
Objective Discuss the key elements of LEAN Strategy
Ian Marshall
Introduction In terms of LEAN/Continuous Improvement, how would you describe your organization s level of maturity: Beginner Intermediate Advanced Results Beginner Intermediate 2-4 5-10 Years Advanced
What is LEAN?
LEAN Definition LEAN is an Operations Strategy with a new set of Values to Engage People in Continuously Improving Safety, Morale, Quality, Cost and Productivity. Jeffrey Liker, author of The Toyota Way
Toyota Motor Company New Flyer Industries Winnipeg Police Service St. Boniface Hospital Manitoba Housing
What level of improvement has your organization experienced with LEAN transformation? Can you quantify? <5% 5-20% >20% Safety Morale Quality Cost / productivity Delivery / timeliness / responsiveness Results So Far
What is Culture?
Culture Definition Culture is the sum of people s habits related to how they get their work done. David Mann, author of Creating a Lean Culture
Culture Definition Culture is not something to target for change An organizations culture is the result of it s Management System! David Mann, author of Creating a Lean Culture
LEAN Transformation So many LEAN implementations fail, because Lean is too easy! David Mann, author of Creating a Lean Culture
LEAN Transformation 20% of LEAN Transformation is physical: layout, flow, pull, visual management, daily huddles, standard work 80% is less obvious and more demanding! David Mann, author of Creating a Lean Culture
The Toyota Way These (concepts) are things companies (people) do not normally do. It s difficult to live the Toyota way of production. Fujio Cho, Chairman of Toyota
LEAN Transformation Managers must change from the habitual focus on results to a different and less obvious focus on process David Mann, author of Creating a Lean Culture
John Shook LEAN Transformation Model 1. VALUE DRIVEN PURPOSE What is our value driven purpose? 4. LEADERSHIP 2. PROCESS 3. PEOPLE CAPABILITY What is the work to be done? What is the management system? What behaviors are required? What capabilities do we need in our people? 5. CULTURE What is the basic thinking/mindset/assumptions that underlie the transformation? Click on this link to hear John Shook explain his LEAN Transformation Model : https://www.youtube.com/watch?v=oerxot8lv0g
Three Types of Improvement Kaikaku - radical change Kaizen Blitz - cross functional improvement Kaizen (daily) improvement
The LEAN Turnaround Author Art Byrne
Management Fundamentals LEAN is the Strategy The main objective is to deliver value to the customer Don t just do LEAN, be LEAN Lead from the Top LEAN transformation is hard to do! LEAN transformation is a multiyear effort Transform the People Transforming the way people think and act is the real key to success The Kaizen Team approach gives everyone a voice Begin with a promise that nobody will be laid off as a result of LEAN Art Byrne author of The LEAN Turnaround
How far is your organization on Progress so far LEAN as the (operations) Strategy Engagement of the people (re LEAN) Leadership from the top (re LEAN)
Work to Takt time Time available/daily customer demand = takt time LEAN Fundamentals One-Piece Flow One-piece flow brings gains in quality and productivity Standard Work Standard work encompasses the work, the work sequence and the tools, equipment, materials and time needed to do the work Connect to the customer using a pull system Must establish takt time, one piece flow and standard work first! Art Byrne author of The LEAN Turnaround
Henry Ford on Standards To standardize a method is to choose out of the many methods the best one, and use it. Standardization means nothing unless it means standardizing upward. Today s standardization, instead of being a barricade against improvement, is the necessary foundation on which tomorrow s improvement will be based. If you think of standardization as the best that you know today, but which is to be improved tomorrow - you get somewhere. But if you think of standards as confining, then progress stops. Henry Ford - Today & Tomorrow 1924
How far is your organization on Working to Takt time One-piece flow Standard work Progress so far Pull Arctic Cat, St. Cloud, MN
Communicate the why Create the environment Deliver results Elements of LEAN Strategy Three things to consider
Expected Results from LEAN Transformation Lead times from weeks to days Inventory turns quadrupled 15% - 20% productivity improvement per year 50% reduction in defects per year 50% reduction in floor space 4% - 8% improvement in gross margin Working capital as a percent of sales halved Increased growth and wealth Creating a learning culture Art Byrne author of The LEAN Turnaround
Communicate the why Décor s mission is to create cabinets people love, bring light to the world and the community, to build life into people s lives and to leave behind more then we take Larry Dyck, President & CEO, Décor Cabinets
Communicate the why Video: Colleen Abdoulah, Leadership and Culture Transformation Colleen Abdoulah, President & COE, WOW Communications Click on this link to hear highlights from the LEAN2015 Keynote Speakers: https://www.youtube.com/playlist?list=plhr-orb37j- OiZA5lLFExypVTpJyJraLs
Communicate the why Create the environment Deliver results Elements of LEAN Strategy Three things to consider
Create the environment Communicate the Why Explain why your doing this and what you expect to get as a result Reorganize your people around Value Streams The structure at the top can stay the same, but the approach changes Focus on the way you structure value adding activities Create a Kaizen promotion office The head of the Kaizen Promotion Office is a high-level position Add some LEAN consulting help LEAN consultants are more hands-on trainers and coaches Art Byrne author of The LEAN Turnaround
Create the environment Organize Around Value Streams Q u o t e Sales Parts Engineering Assembly Planning Paint Purchasing Finishing Production Shipping C a s h
Leaders Role Set direction and build organizational capability to solve problems at the root cause Support through daily gemba walks and frequent reviews of the key performance indicators (KPIs) Identify breakthrough opportunities and set stretch goals to achieve them Show respect for all your associates Art Byrne author of The LEAN Turnaround Three keys to leadership Go See Ask Why Show Respect Fujio Cho, Chairman of Toyota
Leaders Role Set Stretch Goals Karl Wadensten, President/CEO VIBCO Inc. VIBCO Vision - Same day, next day
How clear is your organization s Vision Does it challenge, inspire and motivate Progress so far Does it provide direction
Core Values: People Customers Kaizen Leaders Role Establish Values and Expectations Employee Expectations: Tell the truth Be fair Try new ideas Ask why Keep your promise Do your share Art Byrne, author of The LEAN Turnaround
Keep Lean Simple Eliminate waste by fixing what bugs you 3S ing: Sweeping Sorting Standardizing All waste comes from overproduction Wash your hands 10X per day learn by doing We are all Process Engineers Goal every person, everything, everyday Paul Akers FastCap.com Leaders Role Daily Gemba Walk http://paulakers.net/books/2-second-lean-resources/2sl-our-top-lean-videos
Leaders Role Daily Gemba Walk It s better to ask the right question, than to give the right answer The moment you tell someone to do something, you take away their responsibility John Shook, President Lean Enterprise Institute
Leaders Role Top Management Policy Deployment Middle Management Kaizen Supervisor Daily Management Frontline Associates 0% 50% 100% Time Art Byrne author of The LEAN Turnaround
Leaders Role Policy Deployment CEO Goals & Strategy Executive Middle Manager Supervisor Plans & Results Frontline Associate Lean Sensei International
Communicate the why Create the environment Deliver results Elements of LEAN Strategy Three things to consider
Deliver results Begin with stability producing lean projects and use them to prepare the ground for lean management David Mann, author of Creating a Lean Culture
Deliver results Before After LEAN Greenbelt two-day 5S Kaizen Blitz
Deliver results Bottlenecks Process Step Cycle Time Issue Root Cause Solution Wherever there is a customer, there is always a value stream your challenge is to see it Jim Womack author of Lean Thinking
LEAN Management System 3. Leader Standard Work (sustaining behaviour) David Mann 2. Standard (Visible) Accountability Process Focus 1. Visual Controls (frequent focus on process health) If the Lean Management System is healthy Then the Lean Production System is healthy
Visual Controls Expected vs. Actual
Visual Controls The status of virtually every process should be visible in lean management Visual controls connect people to processes and reflect adherence David Mann, author of Creating a Lean Culture Hour By Hour Actual to Plan Progress Chart
Traditional management: Did you meet the schedule? Accountability Process Lean management: What caused the problem that interrupted the process and who will do what to fix it? David Mann, author of Creating a Lean Culture Daily Huddle Shift Plan & CI
Leader Standard Work The closer your position to Production, the more time you should spend Leaders Role: Establish the process Monitor adherence Improve the process watching the process David Mann, author of Creating a Lean Culture
Leader Standard Work Go to visuals regularly to verify they are being completed Conduct Standard Accountability meetings around visuals Ask about misses Make assignments to understand and act on the causes of the misses Follow-up on current and overdue assignments David Mann, author of Creating a Lean Culture
Mitsubishi Caterpillar LEAN Management System
Genie s LEAN Management System Tier 1 Team Leader lead Big 5 - S, M, Q, C, D focus on abnormality Tier 2 Supervisor lead Drive improvement Tier 3 Value Stream Leader lead Ensure cross functional support Tier 4 Plant Director/Ops Manager lead Audit the system
LEAN Management Video: Jim Lancaster LEAN Management Jim Lancaster, President & COE, Lantech and author of The Work of Management https://www.youtube.com/watch?v=mxingxdambw
Conclusion! Listen to and learn from the people who make the product Everyone s job is to look for improvement give them the tools, and show them you care Create an environment where people can enjoy their work Wilbert James President - TMMK