Losing our Marbles

This is the introduction to a book which a colleague of mine bought last week, going into detail on the often misunderstood, misinterpreted and/or misapplied field of lean six sigma.  I'm sure many of you can relate to this...

In the beginning there was the plan
And then came the assumptions
And the assumptions were without form
And the plan was completely without substance
And darkness was upon the faces of the workers
And they spake unto their marketing managers, saying "it is a pot of manure, and it stinketh"
And the marketing managers went unto the strategists and saith,
"It is a pile of dung, and none may abide the odor thereof"
And the strategists went unto the business managers and saith,
"It is a container of excrement, and it is very strong and such that none may abide by it"
And the business managers went unto the director and saith,
"It is a vessel of fertilizer, and none may abide by its strength"
And the director went unto the vice president and saith,
"It contains that which aids plant growth and it is very strong"
And the vice president went unto the senior vice president and saith,
"It promoteth growth, and it is powerful"
And the senior vice president went unto the president and saith,
"This powerful new plan will actively promote growth and efficiency of the company and the business in general"
And the president looked upon the plan and saw that it was good
And the plan became policy.

"The plan" - (David H. H. Diamond)
from the book "The Heretic's Guide To Best Practice" - The Reality Of Managing Complex Problems In Organisations

by Paul Culmsee & Kailash Awati

Although I haven't read the book yet myself, I will endeavour to do so soon.  It is meant to be some light reading with a good sense of humour as I understand.  Chase Performance understand the difference between words and action, and the results and outcomes from our programs with our clients speak for themselves.  For more information on lean six sigma programs for your whole organisation please visit our web site: www.chaseperformance.com or contact us on 1300 880 338.  With locations in Melbourne, Adelaide, Perth, Brisbane & Sydney, we are a truly national provider that can support your business and help you implement systems and processes by giving you access to our specialists and resources.

Toyota Production System (TPS) - Founding Philosophy

“There is no royal road to success in life.  It takes the right process to achieve a great result.”

– The founding philosophy of the Toyota Production System

5 Ways Process Is Killing Your Productivity

Yes, Process Improvement is what we promote, but within reason and the guidelines of a lean business.  Below is an article that shows how taking things out of context or trying to put your own spin on it, can actually be detrimental to a business.  We specialise in lean six sigma, and compare your business to world's best practice.  Based on the audit results, we tailor our programs to best suit your business, as there is no one glove fits all solution.  Take the first step to improving your business, it doesn't cost you anything, but the outcomes will be substantial in process improvement, culture, staff retention and your bottom line! Visit us at www.chaseperformance.com or call us on 1300 880 338.  You can email me direct at roland.weber@chaseperformance.com for more information.

Best regards and enjoy the re-produced article below

Roland Weber

Expert Perspective

5 Ways Process Is Killing Your Productivity

BY LISA BODELL | 05-15-2012 | 10:40 AM

This article is written by a member of our expert contributor community.

If your team spends its days asking for permission before executing, taking an hour to complete expense reports or time sheets, attending redundant meetings, or answering irrelevant emails, you’ve got a problem.

Processes are supposed to help organizations scale up, improve efficiency for new hires and existing employees, and so on--but they can quickly get out of control.

In a study of U.S. and European companies, The Boston Consulting Group found that “over the past fifteen years, the amount of procedures, vertical layers, interface structures, coordination bodies, and decision approvals needed...has increased by anywhere from 50 percent to 350 percent.” What’s more, in the most complicated organizations, “managers spend 40 percent of their time writing reports and 30 percent to 60 percent of it in coordination meetings.” No wonder people feel like they can never get any real work done.

Why do we love process so much? It offers a way to measure progress and productivity, which makes people feel more efficient and accountable. When used correctly, processes should standardize and simplify the necessary tasks that keep business running smoothly. They should enable organizations to undertake complex work, particularly as an organization grows. Expense reporting, for example, should have a process that every single employee follows every single time--that’s just common sense. Smart processes encapsulate bundles of organizational knowledge. And that’s a good thing.

But it’s not a good thing when there are so many processes in place that they restrain the people they’re supposed to help. If your team spends its days asking for permission before executing, taking an hour to complete expense reports or time sheets, attending redundant meetings, or answering irrelevant emails, you’ve got a problem. Exactly when are employees supposed to find the time to innovate when every task or topic is labeled “urgent” and every deadline is ASAP? Something will eventually give, and that something is going to be the part of the job they can keep pushing off until later.

Here are five ways process can kill production: 

1. Empowering with permission--but without action:It’s not empowering when people are given more responsibility, yet must still obtain an unreasonable number of approvals and sign-offs to get anything done. This signals a lack of trust.
2. Leaders focused on process instead of people: In an effort to standardize and sanitize everything we do, nothing at work is personal anymore. Leaders look to processes, not people, to solve problems--and it doesn’t work. Where’s the inspiration, the vision? This signals a lack of humanity.
3. Overdependence on meetings: “Collaborative” and “inclusive” are corporate buzzwords, but productive teamwork does not require meetings for every single action or decision. People become overwhelmed and ineffective when they are always stuck in meetings. This signals that politics have taken precedence over productivity.
4. Lack of (clear) vision: Great companies need a grand vision and important goals. Too often, companies have vision or mission statements laden with jargon but devoid of meaning. This signals a lack of purpose.
5. Management acts as judge, not jury: If the purpose of a meeting is to think, create, or build, management has to stop tearing people down when they propose new ideas or question the status quo. This signals a lack of perspective and openness.

Again, it comes down to priority. When we shift such a huge amount of an organization’s focus onto standardizing everything, other areas inevitably suffer. According to aBusinessWeek article called “Six Sigma: So Yesterday?,” the program ultimately did more harm than good when it was implemented at Home Depot: “Profitability soared, but worker morale dropped, and so did consumer sentiment. Home Depot fell from first to last among major retailers on the American Customer Satisfaction Index in 2005.”Over the years I’ve encountered organizations, large and small, that have essentially allowed process to becometheir culture. I’ve also seen businesses suffer when they assumed that if a process worked well for one division, it would work well for the company overall. Good processes can turn especially dangerous when they creep from manufacturing lines and finance departments into brainstorms and research labs. Some of the worst offenders have been companies that implemented overarching processes like Six Sigma, a rigidly data-driven quality-management program originally designed to tackle manufacturing problems. Fifty-three percent of the Fortune 500 have deployed it and of the Fortune 100, 82 percent have used it. Despite its manufacturing origins, Six Sigma has been used across many industries and sectors, and proponents claim it saved Fortune 500 corporations nearly a half-trillion dollars since its inception. If so many successful organizations are using it and saving money, what’s the problem, right?

Another oft-cited example of Six Sigma’s negative effects occurred at 3M. When former GE executive James McNerney took the helm in 2001, he instituted a rigorous Six Sigma program, which meant slashing costs, training thousands of employees to become program experts, and requiring extensive reporting on new products in the R&D pipeline. In the short term, especially in the eyes of investors, it seemed to work. Costs were brought under control, production speed increased, and operating margins rose from 17 percent to 23 percent by 2005. But researchers in the labs were stifled by the demands of the new metrics. 3M had a century-long history of innovation, but now R&D had been cut and inventors weren’t given adequate time to tinker with products before having to demonstrate successful commercialization. “We were letting, I think, the process get in the way of doing the actual invention," said Dr. Larry Wendling, staff vice president at 3M's Corporate Research Laboratory. 

After McNerney’s departure for Boeing in 2005--just four years after joining the company--3M began to reevaluate Six Sigma. In addition to the friction it caused among staff, its long-term growth potential appeared compromised and there were concerns that 3M had become “a less creative company...a vitally important issue for a company whose very identity is built on innovation.”

In recent years, 3M has significantly changed the way it uses Six Sigma. The company acknowledges that the program adds value in its factories, so it’s still utilized in manufacturing operations. Researchers working in the labs, however, are no longer beholden to the metrics and rubrics of Six Sigma. The shift has been successful--and there are metrics to prove it. One of the best measures of innovation efforts is the percentage of revenue that a company derives from products introduced in the last five years. At 3M, this number had traditionally hovered around 30 percent, but had dropped to 21 percent after Six Sigma’s introduction. In 2010, the number was back up to 30 percent and may soon surpass 35 percent.

I don’t mean to vilify Six Sigma unfairly. It’s just one example in a long list of top-down processes that people mistake as a silver bullet to improve their entire business. TQM, Lean Six Sigma, ISO, etc.--they all entrench organizations in policies and procedures, minimizing the organization’s innovation potential.

Today, managers are especially in a bind. They’re expected to efficiently produce outstanding short-term results, but the innovation they’re supposed to pursue could very likely hurt their careers. A 2011 PricewaterhouseCoopers survey summarizes the quandary:

“Those in middle management... found innovation disruptive to their day-to-day activities and felt it got in the way of running an efficient operation--which is what they were paid to do.”

When people’s jobs depend on meeting metrics and maintaining the status quo, can you fault them for their reluctance to expend any energy toward creation and invention?

Reprinted by permission of Bilbiomotion. Excerpted from Kill the Company: End the Status Quo, Start an Innovation Revolution, copyright 2012 Lisa Bodell. All rights reserved.

[Image: Flickr user Deja Photo]

Making it Lean - Don’t Underestimate Lawyers’ Resistance to Change

Seyfarth Shaw has learned a lot about lawyers and their resistance to change as the firm embraced Lean Six Sigma, a management approach emphasizing process improvement and efficiency in legal work.

Seyfarth Shaw chairman J. Stephen Poor outlines the lessons learned in an article for the New York Times DealBook blog. “Never underestimate the resistance to change from lawyers,” he writes. “Even more likely, never underestimate the ability of lawyers to describe virtual status quo efforts as revolutionary change. Working through a change management process intended to deal with that push-back has been a core element of our challenge for years.”

Resistance came not just from lawyers in his firm, Poor says. Most of the firm’s clients are also lawyers, and they also showed reluctance. The firm has learned that it had to build a business case for change, working in collaboration with clients.

Two other lessons learned:

• Law firms do need to change how they manage their businesses, with a focus on client demands for better value. Except for a handful of law firms, “the status quo will not drive long-term success,” he asserts.

• Don’t settle for half steps. "Marketing efforts are lovely; certainly, we all do marketing," he says. “But if one is to truly evolve a business model, the only way to avoid having it become simply a marketing effort is to recognize that it must drive through all parts of the organization."

Re-Engineering the Business of Law

BY J. STEPHEN POOR

J. Stephen Poor is chairman of the international law firm Seyfarth Shaw.

True long-term success requires businesses to improve continually and reimagine how they operate in the face of changing competition and market forces. Yet this innovative urge, which drives so much of the rest of the American economy, is largely absent from large law firms.

Instead, the measures become balancing rate growth versus discounted fees, lawyer productivity measured in tenths of hours, recruiting the partner with a book of business from one firm to another and similar yardsticks.

These address the traditional measures of law firm profitability. The need of the purchasers of legal services — at least from large law firms — continues to change, however. The pressure on in-house counsel to deliver better services using fewer resources has never been more intense. In order to meet business demands, corporate counsel are increasingly looking for firms that deliver greater value. Looking out on a landscape that includes a wider variety of choices than ever before – regional firms, national firms, global firms, virtual firms, legal outsourcing providers and contract firms, among others — their purchasing decisions continue to evolve.

If the recent recession teaches anything for the legal industry, it is this: The changing demands of our clients require the legal services profession to find different paths to deliver value to those who buy our services. Lawyers today should be asking themselves nontraditional questions: how to apply resources more effectively, to shorten cycle time and lower the cost of their work product and other deliverables, while raising the level of service. In the end, your client will reward you by giving you more work across more areas, and your relationship will deepen.

The ground on which we walk has been altered. Traditionally, large law firms fit into largely homogenous business models. Whether we recognize it or not, that has changed and will continue to shift. As we navigate a different world, our experience presents three core lessons:

Be Prepared to Examine and Reimagine the Business Model.

Our firm has been on its own, unique path for years. Over the past seven years, we’ve used a version of Lean Six Sigma borrowed from the manufacturing sector to redesign core elements of how legal work process is measured and deployed. This has resulted in a variety of tools, analyses and process improvement techniques intended to drive efficiency into the delivery of legal services – at all levels of the practice. More important, it aligns a way of thinking with the needs and requirements of corporate purchasers of legal services.

What works for us, however, may not work for every firm. Culture, current firm composition and many other factors should drive the way any firm responds to the market. The point, however, is that — other than for a handful of firms — the status quo will not drive long-term success. Change, particularly one involving lawyers, is a painful, prolonged process. Nevertheless, change, driven from innovation and a consistent focus on client needs, must drive how we look at and manage our businesses. Learning from our colleagues in the industry is important, but adapting that learning and innovating in the delivery of our services is critical.

Don’t Settle for Half-Steps.

Too often, I see firms start down a path only to stop at partial implementation or inconsistent philosophies. At Seyfarth, we realized that trying to drive different behaviors would require us to restructure things like associate evaluation (which we did by putting our compensation and advancement structures into a pure competency model) and re-examine our staffing models (for example, we eliminated a traditional summer program and replaced it with an education-based fellowship program). The global reach of our clients and their need for integrated, efficient service delivery across multiple countries, led us to create the largest multijurisdictional international employment practice, among others.

The point is not that our path is for everyone. The point is that the willingness to change and adapt business models must anticipate and address the variables that drive organizational success.

Marketing efforts are lovely; certainly, we all do marketing. But if one is to truly evolve a business model, the only way to avoid having it become simply a marketing effort is to recognize that it must drive through all parts of the organization. This will result in changes and modifications that were not anticipated but which make sense and should be adopted in order to have the overall change work properly.

Never Underestimate Resistance to Change.

Never underestimate the resistance to change from lawyers. Even more likely, never underestimate the ability of lawyers to describe virtual status quo efforts as revolutionary change. Working through a change management process intended to deal with that push-back has been a core element of our challenge for years. We consciously developed methodologies that linked to the history and culture of our firm or used client voices to support and build the business case for change. As we were able to demonstrate success on smaller scales, we were able to build agents for change that effectively permeated the firm.

What we did not anticipate was the resistance from other crucial stakeholders – especially clients. Much of what we’ve done is most effective when deployed in a collaborative change process with clients. What we overlooked at the outset is that, by and large, our clients are lawyers, too, and many of them are the products of the culture of their own business. Understanding the various viewpoints and building the business case to involve this crucial constituency was something we learned along the way. The nature of the process requires a continuous, but slow march toward improvement and adaptation. Some things we tried worked and some did not. Nevertheless, the continuous move forward takes persistence and, perhaps, a bit of stubbornness.

Hospital wins award through planning (process improvement)

This article explains how simple process improvement activities resulted in great results.  To find out more about how we can assist you health organisation through cost neutral solutions in the same way please contact us at focus@chaseperformance.com or call us on 1300 880 338.  Alternatively you can also visit our web site: www.chaseperformance.com

Planning at Waikato Hospital wins award

A Waikato Hospital project looking at delivery and capacity planning within the hospital, has been deemed so effective, it has won an award at tonight's Waikato District Health Board Best of Health Awards.

By far the biggest category, there were 14 entries in the process improvement category claimed by Waikato Hospital, which looks at recognising how planned improvement activities - both clinical and non-clinical - led to significant improvements in patient care or process improvement.

Process improvement activities aim to improve customer and staff satisfaction; and at reducing or eliminating process waste such as resources and time.

A brief description of the project

Waikato Hospital historically provided a set number of beds over the year with closures allocated primarily to known low elective periods, such as Christmas.

The associated nursing staff rosters were driven by budgeted matrix, which did not necessarily align with planned or acute demand.

There was minimal knowledge of seasonal demand, which regularly resulted in high elective surgical cancellations, large numbers of patients nursed outside of their specialty areas, high nursing costs associated with misaligned rosters with workload, and scheduled theatre sessions poorly utilised.

As a result of this project, there has been a focus on improved planning to place patients in the right place, in the right beds, at the right time. There has been an increase in surgical throughput and a decrease in cancelled surgeries.

This has therefore improved patient access to elective services and patients are spending less time waiting in ED for a ward bed.

Judges comments

"This project is using an off the shelf programme to the max; when it was obtained it was used DHB wide and implemented thoroughly. From the patient's perspective, this has had a monstrous impact.

"It is amazing in a hospital the size of Waikato, to embed something this large so quickly and get staff confidence in its use."

Other projects that received honourable mentions at the awards were:

Community pharmacy anticoagulation management service from Pharmacy 547

The Waihi Project (family violence) from Population Health, Waikato DHB

Waikato virtual lesion clinic from Waikato DHB's Dermatology Department; and

Working together to reach the health target of 90% of two-year-olds being fully immunised by June 2011 from Toiora Primary Health Organisation

For more information about the Best of Health Awards, other entries and the awards evening, visit www.waikatodhb.health.nz/bestofhealth

What is 5S

5S is the name of a workplace organisation methodology that uses a list of five Japanese words which are seiri, seiton, seiso, seiketsu and shitsuke. Transliterated or translated into English, they all start with the letter "S". The list describes how to organise a work space for efficiency and effectiveness by identifying and storing the items used, maintaining the area and items, and sustaining the new order.

Sorting (Seiri)

Eliminate all unnecessary tools, parts, and instructions. Go through all tools, materials, and so forth in the plant and work area. Keep only essential items and eliminate what is not required, prioritising things per requirements and keeping them in easily-accessible places. Everything else is stored or discarded.

Stabilising or Straightening Out (Seiton)

There should be a place for everything and everything should be in its place. The place for each item should be clearly labeled or demarcated. Items should be arranged in a manner that promotes efficient work flow, with equipment used most often being the most easily accessible. Workers should not have to bend repetitively to access materials. Each tool, part, supply, or piece of equipment should be kept close to where it will be used – in other words, straightening the flow path. Seiton is one of the features that distinguishes 5S from "standardised cleanup". This phase can also be referred to as Simplifying.

Sweeping or Shining (Seiso)

Clean the workspace and all equipment, and keep it clean, tidy and organised. At the end of each shift, clean the work area and be sure everything is restored to its place. This makes it easy to know what goes where and ensures that everything is where it belongs. Spills, leaks, and other messes also then become a visual signal for equipment or process steps that need attention. A key point is that maintaining cleanliness should be part of the daily work – not an occasional activity initiated when things get too messy.

Standardising (Seiketsu)

Work practices should be consistent and standardised. All work stations for a particular job should be identical. All employees doing the same job should be able to work in any station with the same tools that are in the same location in every station. Everyone should know exactly what his or her responsibilities are for adhering to the first 3 S's.

Sustaining the Practice (Shitsuke)

Maintain and review standards. Once the previous 4 S's have been established, they become the new way to operate. Maintain focus on this new way and do not allow a gradual decline back to the old ways. While thinking about the new way, also be thinking about yet better ways. When an issue arises such as a suggested improvement, a new way of working, a new tool or a new output requirement, review the first 4 S's and make changes as appropriate.

Safety

A sixth phase, "Safety", is sometimes added. There is debate over whether including this sixth "S" promotes safety by stating this value explicitly, or if a comprehensive safety program is undermined when it is relegated to a single item in an efficiency-focused business methodology.

Security

A seventh phase, "Security", can also be added. In order to leverage security as an investment rather than an expense, the seventh "S" identifies and addresses risks to key business categories including fixed assets (PP&E), material, human capital, brand equity, intellectual property, information technology, assets-in-transit and the extended supply chain.

Satisfaction

An eighth phase, “Satisfaction”, can be included. Employee Satisfaction and engagement in continuous improvement activities ensures the improvements will be sustained and improved upon. The Eighth waste – Non Utilised Intellect, Talent, and Resources can be the most damaging waste of all.
It is important to have continuous education about maintaining standards. When there are changes that affect the 5S program such as new equipment, new products or new work rules, it is essential to make changes in the standards and provide training. Companies embracing 5S often use posters and signs as a way of educating employees and maintaining standards.


For more information on how we can assist you at no cost to implement these systems in your organisation please contact me on 1300 880 338 or email sales@chaseperformance.com


Here is another beneficial link to our Japanese associates:  http://www.process-improvement-japan.com/lean-5s.html

Finally, you can visit our web site for more information: http://www.chaseperformance.com