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Use Lean to Ease the Pain of Enterprise Software Implementations

September 27th, 2012 2 comments

Use Lean before enterprise software implementationsLarge scale enterprise software implementations … ERP, CRM, BI, BPM, Ware house management, transportation management, talent management, learning management ….. What do they all typically have in common?

I routinely speak with managers who have been tasked with implementing or supporting the implementation of large-scale enterprise software solutions. All raise a similar set of frustrations:

  • There are a LOT of options, all very different. I just don’t know which is right for us …

  • It’s taking much longer than we thought to do this and negatively impacting our business …

  • Integration and customization costs are out of control and way over budget …

  • We have the system installed and up, but can’t get people to use it …

  • We’re different. We just don’t do things in a standard way and no system seems to be able to handle our requirements. Guess we’ll have to build internally …

Coincidence that I keep hearing the same comments? I think not. From my experience, this is absolutely the rule, not the exception. Now, the question is why does this consistently happen?

I think it’s simply a matter of putting the cart before the horse. So often, technology is looked at as a silver bullet to solve business problems when, in reality, the problem is one of process and not product (i.e. technology solution). Let’s put this into perspective … technology solutions should sit on top of good business processes and ideally enable those processes to function better, faster, and cheaper. But,what happens when you try to overlay an ill-defined or just plain bad business process with a technology solution? You guessed it … experiences like those outlined above.

I think some very focused process characterization and Lean work on the front-end of system decisions and implementations could alleviate a lot of the frustration, if people would just take the time to do it. Some things to think about ….

  • Start with top level enterprise metrics and a high level value-stream. Identify the key value adding processes, their associated owners, and the metrics those owners manage to. This will help identify critical stakeholders and to crystallize the reporting that is really required

  • Start breaking down those top-level processes and characterizing across all operations. Are all operations doing things the same way, measuring the same things, etc? Most likely, they are not. Where differences exist, work collaboratively to identify best practices and consolidate to a best-of-breed process.

  • Look for unnecessary complexity, waste and defect-producing aspects of processes. Run focused improvement teams to correct. Remove the fat and make processes as LEAN as possible BEFORE trying to systemize. Waste and complexity in processes equals increased cost for system integration and customization, GUARANTEED.

  • Payoff. From steps 1-3 above, a well-defined and actionable set of requirements will be derived AND prioritized. This helps with product selection AND with system integration, customization and testing. Get it right the first time … what a concept, right?

Of course these actions will take some time on the front-end, but my contention is that the time and expense of doing this process work in front of a system implementation will almost always pay for itself many times over. Sometimes we seem to for get that it’s the business processes that serve customers and produce revenue, not the technology you’re trying to implement to supposedly improve those processes.

A little preparation and risk prevention now, or a lot of pain and suffering down the road? You make the call ….

Feel free to contact me if you’d like to discuss. I’d love to hear your insights and ideas.

Lean In IT ? – Surely you Jest ….

September 25th, 2012 4 comments

Lean in ITRepeat after me … Lean is not just for manufacturing … Lean is not just for manufacturing …..  Fire up your browser and just ask Google.  It will enlighten you with many, many examples of  Lean making a big impact on service organizations … reducing costs, making things faster, making things just better.  You’ll find it in healthcare, government services, financial services, logistics,  and one that is near and dear to everyone’s heart ….. IT.  Yes, I said the I-word …

Remember, Lean is first and foremost about the elimination of waste, and I would argue that there is plenty of waste in IT, hence there is applicability for Lean in IT.   To take things further, since IT is supporting the broader business needs, waste in IT can be magnified into bigger waste (and bigger problems) as it filters through the business.  A good way to look at how Lean applies is to look at the elements of waste and make the connection to IT ….

Waste of Defects.  Systems not meeting requirements, software bugs, missed deadlines, blown budgets, etc.  This clearly adds cost to IT, but I would argue that the impact to the business can be even larger in terms of $’s.  Incorrect handling of a single customer transaction can cost the business big in terms of cost, lost revenue, and potentially attrition.

Waste of Overproduction.  Here, overproduction means simply doing things that don’t need to be done, like working on low-impact squeaky wheel projects that really don’t provide value to the business.  This is the classic IT Alignment with the Business problem that has been talked about for years and years.  The cost to the broader business is that strategic projects offer real value don’t get worked.

Waste of Waiting.  Test teams waiting for the next load that’s running behind, development teams waiting for test results, waiting for new hardware, waiting for software upgrades and patches, etc.    But, again, the business impact can be bigger.  Think about slow application response times, inefficient problem escalation process, missed deadlines delaying product launches, etc.

Waste of Overprocessing (non-value add processing)A good example here is IT keeping track of excessive amounts of technology metrics, and then reporting those metrics to business managers.  Again, the old business / IT alignment demon rears its head.

Waste of Transportation. On site visits to correct hardware/software issues, physical security, compliance, or software audits, vendor visits for equipment that might not really be needed, etc.

Waste of Excess Motion. Firefighting creates excess motion, and I think it’s safe to say that firefighting is a way of life for many IT organizations and a productivity killer.

Waste of Excess InventoryServer sprawl, under-utilized hardware, software installed that no one uses, development and test teams benched, waiting for their next assignment

Waste of Underutilized TalentFailure to encourage and capture new ideas for innovation, retention issues, high-value employees used for mundane tasks that really require a much lower skill level, or possibly even automation (i.e. regression testing).   And I’ll add one more here … build vs. buy.  What is the impact when IT leverages its resources to build something inhouse, when a better and cheaper solution could have been bought?  This negatively impacts IT and the business heavily.

Download Lean Services

a short Powerpoint that discusses Lean in a services environment

OK, do can we agree that some (or all) of the above wastes happen in the typical IT department?  I thought so.  And, if Lean thinking and tools can help you reduce these and other wastes???   They can.

So, I think it’s pretty clear that there are many opportunities to use Lean to help IT organizations better serve their customers (i.e. the business), and lower IT costs and resource requirements.  I also believe that, due to most businesses’ increasing dependence on IT, the bigger value to improvements will likely be realized by the business, through smoother operations, better resource utilization, and happier customers and employees.   There are some really interesting trends like SOA and BigData that I’ll talk about in future articles that make Lean even more applicable.

Think about it and Contact me if you’d like to discuss how lean can be applied to IT organizations in more detail.

Lean in Shared Services Organizations – Could Deliver Big Bang for the Buck …

April 24th, 2012 3 comments

Lean in shared servicesBusiness models becoming more complex, customers asking for more and more for less and less, competition much more fierce, and an incessant demand to keep costs (headcounts) down — a new reality that is not just gently suggesting, but  demanding more effective utilization of available, and often scarcer,  resources.

Enter – shared-services organizations.  A shared services organization (SSO) can theoretically consolidate support operations into a single organizational unit and substantially improve operating efficiencies by eliminating duplication and excess overhead, and streamlining and standardizing processes.  The SSO should be able to deliver a substantially better service at a substantially lower cost.  It should be a center of both value creation and cost reduction for the enterprise.  If it can’t do this, you have to ask … what’s the point?

In concept, establishing a well-functioning, value-delivering SSO sounds really simple. BUT, reality says not so fast.  I work with companies every day, and it’s a very rare event (and that’s generous) for me to hear someone say their internal shared service organizations deliver the highest-quality, while being the lowest cost provider of services.  Why is this?  Optimized internal SSOs should be able consolidate, standardize, and optimize known best practices for the enterprise, right?  They should be able to align with the strategic direction and goals of the company, and orient service levels towards improving customer experience, right?   I mean, they’re part of the enterprise, so they should be able to do these things at least as well and an external provider of the service, right?

There’s more to good shared services organizations than just consolidating people and systems …

Often times, it does seem that a shared services organization was built simply by throwing together people and systems from different areas and groups.  All I can say is good luck with this approach.  In reality, it requires a change in mindset and an increased focus on the overall business, and a hard look at the processes that are really needed to drive the business. No more living in that isolated black box.  Successful SSO’s integrate aligned and continually optimizing processes with right-fit people, information, and technology automation to deliver a totally new level of capabilities.

Download Lean Services

 a short powerpoint overview of Lean in Services Operations …

Download Lean in internal service functions  a example approach to applying lean at an operations level …

  • Understand the value stream, end-to-end, from both the customer AND the producer perspective.  You can’t optimize what you don’t understand.
  • Establish meaningful and actionable service and process metrics that serve all customers of the service.  Make the metrics visible.
  • Focus on driving efficiency by eliminating wasteful, non-value-add steps and unnecessary complexity — from supplier, producer, and the consumer of the service.
  • Constant focus on customer experience, alignment, and process improvement.  Well-executed, targeted Kaizen events can deliver improvements in weeks or days, not months or years.  And, those improvements positively impact all customers of the service.

There are many other examples, but the point is that if you’re looking for a place from which to pull significant additional value, then you may need to look no further than then enterprise’s shared services organizations.  And Lean may be a powerful and extremely cost-effective tool to apply.  As always, feel free to contact me directly if you’d like to discuss in more detail.

Small Steps Lead to Success for Lean in Service Operations

April 13th, 2012 Comments off

Lean - Small Steps for Service OperationsImprovement is about change, and change is tough.  It doesn’t matter if you are trying to change personal health habits or a critical business process, it’s just tough.  But change in Service Operations is particularly difficult because so much is not visible to easy inspection, embedded in individuals, lacking data, in constant flux, and dependent on many variables.  These same challenges apply to deploying Lean in Service and Back Office operations.

A natural path many disciplined thinkers follow for any improvement of any type is to thoroughly understand the total system before embarking on improvement.  But within Service Operations the complexities are so great that to thoroughly understand the system requires so much time and investment that the business gives up on the effort before ever getting improvement activities that yield results off the ground.  This is made even more challenging because of the tight resource constraints we face in this economic environment and the demands of ever more discriminating customers.  As in all businesses these days, Service Operations must do more with less.

Our proposed philosophies at a deployment level, about which we have written often, are things like pulling capability development at the rate the business needs it, building foundational capabilities broadly before developing advanced capability, paying for new capability development by providing hard returns on investments as they are made, and aligning resources and efforts to business and customer metrics (i.e. things that really matter).

Download Lean Services

 a short Powerpoint discussing Lean in Service Operations …

We take these philosophies down to a project execution level by building an understanding of the project problem solving roadmap and moving back and forth between tools to validate project assumptions while using a lot of tollgates so as to invest time wisely.  Use a problem statement and simple SIPOC to define goals, owners, team members and the process. Take that to tollgate to ensure alignment before moving to deep process characterization.  Use the SIPOC’s process column to do a preliminary value stream with some simple time and quality assumptions and conduct a tollgate review before moving to functional flow charts or collecting data.  Do a simple fishbone diagram to validate the demographics of the data before moving to a more detailed FMEA or creating a data measurement system.   And constantly validate the business case and alignment.

The point is that the need to use resources wisely and drive change counter intuitively means we should take many smaller steps rather than looking for the big steps.  The complexity and immaturity of the system makes the understanding of the overall system too expensive and the success of a big, top down project too low a probability.   Keep this in mind when trying to deploy Lean in a services operation, and your chances of success improve greatly.

If you would like to discuss any of these points, feel free to contact me .

Lean for Service Operations – It Really is Different …

March 30th, 2012 2 comments

Lean Services vs. Lean ManufacturingWe have many conversations with companies that want to talk about applying lean in areas other than manufacturing.  Some of these companies are manufacturers that have been doing Lean for years, and doing it well in their productions operations, but not at all in non-manufacturing parts of the business.  Others are pure services companies like telcos, banks, and insurance companies that are just now starting to explore Lean.  In many cases, they’re looking at Lean because they’re being asked to do more with the static or declining headcounts.

One of the challenges that I keep seeing is that companies try to do Lean Manufacturing in a services environment.   Let me be blunt … if you think you can blindly copy the tools of Lean manufacturing in a services environment, you’re setting yourself up for failure.  We see this happen when manufacturing companies that have had great success with Lean in the production operation try to take their Lean manufacturing experts and approaches and leverage them to roll out Lean in services operations.  These people may indeed be Lean manufacturing specialists with great knowledge, but this doesn’t mean they can effectively roll out Lean in non-manufacturing aspects of the business.  In most cases, it doesn’t work.  The same thing happens when services companies hire a Lean manufacturing expert to help them.  It just doesn’t work.  Why?   Because Lean in a services operation is just different, that’s why.

Download Lean Services

this powerpoint overview of Lean in a Services environment …

Now, we could dive right in and start looking at a lot of individual tools and see which ones fit well in a services environment and which ones don’t.  But, I think the better approach is to take a step back and look at the differences from a business perspective first, then come back and start talking about tools and approaches.  So, here are some of my thoughts on how a services environment is different, and these difference most certainly impact the way Lean should be rolled out.  I encourage our readers to chime in with their own ideas.

  • There is typically greater involvement of customers in the production process. In many cases, the customer is a supplier to the process.  Sometimes the involvement is so ingrained in the process that you really end up with co-production with the customer.
  • Since services processes are often very people-centric (vs. machine-centric), it is very difficult to get to real standardization.
  • Quality is an experience, not just a measurement against specifications.  The inability to standardize the process makes it very difficult to standardize quality.  The customer’s definition of quality is a perception, subjective vs. objective
  • There is much less visibility to what is happening.  Information is flowing, not product, and that information can be digital, paper, or even verbal.  And, HOW it flows often has little or no standardization
  • IT systems play a much bigger role.  They enable the process, but can also be a rigid constraint on the process.   There may be multiple and often un-integrated systems.  Workarounds persist in the form of excel spreadsheets, word docs, etc
  • WIP and inventory are often hidden and ignored, but they are there and can have the same negative impacts as in a manufacturing environment (e.g. wasted resources, longer lead times, more variation

These are just a few of the key distinctions, and there are many more.  But they do point out some fundamental differences in manufacturing and non-manufacturing operations.  The differences are so stark that common sense should tell you that you cannot roll out Lean in a services operation the same way you do it in a manufacturing operation, not if you want to see results, and our experience here at Qualtec backs that up.

This is but the first in a series of articles we’ll publish on this.  I invite your thoughts, comments and feedback.  Feel free to contact me if you’d like to discuss.

Reshoring – An Opportunity to Redesign Processes to Lower Total Cost of Ownership

March 7th, 2012 1 comment

Reshoring - Process Redesign to Lower TCOThe drive to reshore goods, and services, for the US market builds every day.  Growth in emerging markets is driving up local wages.  The decline in the value of the dollar has increased the cost to produce abroad for import back to the US.  The need to provide faster AND better delivery makes for a increasingly powerful competitive advantage.  The ability to manage shorter supply chains increases quality.  These and other factors are driving more ompanies to look at reshoring opportunities.

A critical element in a reshoring decision is a Total Cost of Ownership analysis.  Made popular by the Gartner Group when attempting to capture all the costs of software and IT systems over the product’s life, it is an excellent concept to apply to reshoring as it goes beyond a simple vendor price or internal transfer price by looking at overall system costs.  At a personal level, think how we apply it when comparing cars for purchase. We incorporate costs to maintain, operate, insure, finance and, eventually, what we get back when we dispose of the car.  Total cost of ownership …. not just purchase price.

Reshoring to Lower TCOReshoring provides a unique opportunity to lower the Total Cost of Ownership as the existing supply chain and internal production processes can be designed with a blank slate.  The iterative redesign that first occurred when it was offshored and then occurs again when reshoring can leverage past experience, and work with a blank slate.

For example, we have a client which offshored a production line to capitalize on lower direct labor costs.  After a severe fire in the offshore facility, they decided to bring the line home.  They performed a Design for Lean analysis on the entire process and lowered the cost to a level significantly less than the pre-fire offshore line.

Download Lean Overview  this executive brief for a short, practical overview of Lean

Another client brought back its customer service operations.  Again, through a redesign process and armed with clear Voice-of-the-Customer (VOC) about their offshore facility, they were also able to lower its costs and increase customer satisfaction, thus significantly lowering their Total Cost to Service.

Redesigning a production line or a service delivery process are great opportunities to really pour through VOC and design the value streams and supporting processes with a clean slate.  Clear VOC, strong design capability and application of lean skills can collectively be used to take advantage of declining costs in the U.S. and better meet customers’ needs thus lowering the Total Cost of Ownership.

If you would like to discuss these topics, feel free to contact me.

Applying Lean at an Operation Level for HR, Finance, IT and other Internal Service Functions Can Yield Good Results

October 21st, 2011 3 comments

Organizations are increasingly adding tried and true Lean principles, tools and techniques to their continuous improvement initiatives to eliminate waste, improve customer satisfaction and reduce unnecessary costs.  And rightly so.  Successful Lean routinely reduce operating costs 20% – 40% and cycle time by even greater margins, and those cost reductions often go straight to the bottom line.

Lean Operations, Lean Management in Internal Services FunctionsTraditionally, in applying Lean, trained teams identify then eliminate or significantly reduce the non-value added activities and related costs for specific processes within their operation.  But what if there are no “trained teams”?  What if process boundaries are unclear in a functionally silo’d organization?  Does this mean you can’t do anything to get results until significant infrastructure is in place?  I think not.

 

Download an overview of our approach for applying lean at an operations level for internal service functions a short overview of our approach to applying lean at an operations level to internal service functions


We’ve found that Lean concepts and tools can be leveraged at a higher, function or operation level  very effectively.  The good news is that this approach delivers impressive business results on its own in the short term AND sets the stage for even more impactful process level improvements.  This is especially true for back office / internal service operations like HR, finance, IT, sales and marketing, supply chain management, etc.

Lean applied at an Operation Level for internal service and back office functions like HR, Finance, Procurement, IT, Marketing and Sales, and Supply Chain Management can make an immediate business impact …

 

The idea is to identify a complete business operation‘s most impactful cost drivers, BEFORE tightening focus to any process/subprocess in the value stream.  For those of you that have done Lean at the process level, I know this sounds a bit strange and your first thought may be that the scope will be too big and nothing will get done. But, our experience is that this can work very well and be very impactful:

  • It can serve as a front-end audit function, greatly helping to identify next tier focus areas.
  • It recognizes and works within functional boundaries that exist in the enterprise, as opposed to attempting to force artificial process boundaries that, while may be desirable, do not exist
  • It maps and costs all key value streams of a targeted business function or sub-function, a necessary prerequisite for lower level improvements
  • Attacks waste organization wide,  in both the supply-side (internal function itself) and demand-side (customer, consumer of the output).
  • It consistently identifies low hanging fruit opportunities that can be realized immediately
  • It can be used to jumpstart a new lean initiative or address unrealized opportunities from earlier lean events.

Lean Operations (lean applied at an high-level operations level) can definitely be a powerful tool for enterprises that are looking for immediate cost savings and/or performance improvements in internal service operations, but don’t have the desire/bandwidth/budget to start up a formal Continuous Improvement program.   It can be applied to an entire operation (e.g. HR, finance, Legal, IT, etc)  in a relatively short time period, and it does not require a big investment in training and infrastructure.  For those organizations that do want to move to a more structured Continuous Improvement program, it can be an excellent way to jumpstart a BPM, Lean, Six Sigma, etc. program

Need to improve performance or lower costs in internal service functions like Human Resources (HR), Finance, Procurement, Supply Chain, IT, Marketing and Sales, or any other back office type function?   Contact me to learn more about our approach to applying lean at an operations level.

 

Lean Process Improvement / Lean Enterprise – A Key Element of a Pay-as-you-Go Approach

September 22nd, 2011 2 comments

I talk to companies every day about how they can best roll out business performance and process improvement programs.  Now, just to level-set, we aren’t zealots here pushing any one-size-fits-all model for programs. We do have some key principles that we adhere to when designing programs though. One of these is that it’s likely not feasible to have a program that builds infrastructure and trains for many months, before ever delivering any quantifiable return. That is simply not the world most of our clients live in these days.   Our philosophy is that it is always advantageous for the program to deliver near-immediate, visible, and quantifiable impact.

When looking at an enterprise, more often than not, we find that basic process management/improvement and Lean (i.e. Lean Enterprise, Lean Process, Lean Manufacturing, Lean Product or any of the other labels floating around out there) can solve a lot of high impact business problems, without incurring high training and infrastructure costs, and are the right place to start.

Lean Process Improvement efforts can yield big results fast, without big investment or big risk …

 

ROI from Lean Program However, I get a lot of questions dealing with how an organization can get started with basic process management and Lean Enterprise, and how to fit in to an overall, enterprise wide process improvement / CI program strategy.    This is a good question in that, in the past, it was almost always preached that Process Improvement deployments (Six Sigma, Lean, etc) had to be top-down.  Start with executives to get support, develop champions, select projects, train black belts, build a 3-year plan, etc, and grow from there.  The challenge with this approach is that it requires a hefty up-front investment and it takes a long time before results are seen.  Read ….. high cost .. high risk!

our new Lean QuickStart powerpoint presentation.

In today’s business climate, this is simply not palatable for a lot of organizations.  For them, an approach that is much less top-down, and much more focused on near term, bottom line results may be far more attractive.  So, here is an approach sequence that I’ve seen effective over and over

  1. Work with business leaders to identify pilot areas of the enterprise
  2. Identify specific focus areas and business cases in that area(s)
  3. Refine those down to a set of well-defined project charters, segmented by the nature of the problem (defect, cost, cycle time, etc), scale, and perceived complexity.
  4. Select a set of low-hanging-fruit projects that can likely be solved in a relatively short amount of time and with basic lean and quality toolsets
  5. Run 1 or more workshops with specific project teams, with specific well-defined projects that can be executed in 2-5 weeks.
  6. Track real savings and ROI on projects, and publicize/promote heavily internally
  7. After one or more workshops, train champions /sponsors and develop a formal project selection and prioritization methodology (see my recent post on this).  Refine continuously.
  8. Continue with more workshops, to a broader segment of the enterprise

Processes are cleaned up, waste and complexity removed, measurement systems are put in place, and real bottom-line results are realized.  Results drive interest and commitment, so it becomes easier to get the broader organization engaged.  For enterprises that have done little formal process improvement work (or a lot for that matter), there will most assuredly be many Lean projects to be executed, yielding fast and consistent results. And, soon enough, larger and more complex problems that require higher level capability (e.g. six sigma) will show themselves.  Then, and only then, do you bridge up to and invest in the next level of capability …. Pay-as-you-go.

These efforts can easily and painlessly run in parallel with and, indeed, support and pay for the broader activities that are required to make the overall process improvement effort successful long-term, namely identifying CTQ measures for voice of the customer (VOC) and voice of the business (VOB), characterizing value streams and establishing process indicators and metrics, building a mechanism to constantly identify high value improvement opportunities (i.e. project pipeline), and constantly defining and executing improvement projects.

Contact me if talk about whether this model could work for your enterprise.

Process Improvement Goes Back to the Basics for Many…

March 18th, 2011 2 comments

Process Improvement BasicsThe last few years have witnessed big changes in the business climate, and continuous improvement (CI) efforts have certainly seen their share of change. I talk with companies every day and, without a doubt, there has been a fundamental shift in thought on how to best make meaningful process improvement happen.

Prior to 2008, there was significant interest and buy-in for large-scale, top-down initiatives. There was a willingness to set aside large budgets and free up significant resources for the CI initiative.

Training increasingly large segments of the workforce was front and center. Detailed, multi-year plans were put in place. The CI initiative was heavily promoted, internally and externally, and employees were strongly urged to participate.

But, did those big initiatives deliver results? Undoubtedly some did. But, many more, when you really check the numbers, did not. There are many distinct causes why they didn’t work, and I won’t try to dive into that here. But, with the meltdown in the business climate, many leaders took a look in the rear view mirror and didn’t like what they saw …. big dollars and resources consumed with little evidence of concrete results.

Now, does this mean that CI and process improvement is useless and should be abandoned? Of course not. Businesses live and die today based on the strength and adaptiveness of their processes, as compared to their competitors. Does it mean that the tools and methodologies used (Lean, Six Sigma, BPM, etc) are not good and should be replaced with something new? I think not. The tools and methodologies can certainly be improved and expanded (and are), but they are proven to work.

So what’s happened? I believe that, for a lot of companies, there was too much focus on the initiative and not nearly enough focus on results. And based on conversations I have with business leaders every day, I think many have drawn the same conclusion.

So, when smart people see the error in their ways, it typically leads to change. The change that I’ve seen happen for CI is a move back to the basics, and a focus on bottomline, business results. It may return, but for now I see very little interest in big change initiatives whose results are measured over the very long term, if ever truly measured. I see a much more tactical view of CI, focusing on solving specific business problems quickly, as opposed to general quality improvement. CI programs are more likely to be looked at from a bottom-up or grass-roots perspective.

Smart leaders are now letting the specific needs of their business drive what the CI program looks like, what methodologies and tools are applied, how results get measured, what technology platforms are deployed, etc. To borrow from Lean, the business is pulling CI capability, as opposed to it being pushed into the business. In the real world, what does this mean?

Download our executive brief that outlines the basics of Lean a short executive brief that provides a good overview of the basics of lean

Well, I can only give you my perspective from talking with leaders at companies of all sizes and in many different domains, but what I see is a clear move back to the basics of business and process improvement. Basic quality and process tools as employed in Business Process Management (BPM), Lean, and basic quality tools (Yellow Belt) are getting a second look.

Why? Because, for many businesses, the basics will help solve 95% of the real business problems, get results fast, and they can be introduced into the organization for a very low cost and very low risk. The basics also build a solid foundation on which advanced capabilities like Six Sigma and DFSS can be effectively built and deployed to deliver even more dramatic business results, with much less risk.

So, what do you think? Is this just a reaction to circumstances and will large-scale, top down change initiatives return. OR, is this the new normal for companies when it comes to business and process improvement? Feel free to Contact me if you’d like to discuss.

VOC and Lean Value Stream Mapping – A Simple, but Powerful Equation

March 2nd, 2011 Comments off

It sounds so simple. Lean eliminates waste defined as any activity that does not provide value to the customer. Eliminate the waste and you will bring products and services to customers better, faster and at a lower price. Finally, combine it with Six Sigma to reduce variation and defects, and you make breakthrough results.

We all start by understanding that value is defined solely by what the customer actually desires and for which they are willing to pay and that value enabling activities, while not adding direct value, are necessary. We all then look for the true non-value added activities that add waste in the form of unnecessary time, effort or cost. We learn to seek and eliminate those non-value added activities. That is the essence of a lean project.

So what is the lynchpin that makes this elegant equation work? Identify what your customer considers of value and how you deliver it. Once you have that line of site, if you maintain efforts to continually improve, you’ll get there. But without that clarity, your improvement efforts are a march to nowhere.

It is important when developing that line of sight to define value from the perspective of the customer, the Voice of the Customer (VOC). Understand clearly and exactly what product or service the customer desires, when it is to be

delivered, and at what price.

Download a VOC training module dealing with Critical to Customer Requirements, a key element of VOC

Download a training module dealing with Critical to Customer Requirements, a key element of VOC

To understand how your company actually delivers what the customer considers of value, leverage lean tools to precisely map the set and sequence of all specific actions done to bring the product or service from conception to final delivery. This provides a visual display of exactly how a particular process is carried out. Mapping this “value stream” enables you to identify value-adding and non-value adding activities from the customer’s perspective thus setting the stage for improvement.

Along with providing a sense of alignment between your goal of delivering value and your opportunity for improvement, this exercise also carries the message of how problems and solutions are cross-functional in nature. If process owners participate in this process with an open mind, they will learn the futility of looking for a solution from someone else independent of their efforts. Thus, not only does value stream mapping provide alignment from the customer to performance improvement opportunities, but it continues through to an individual’s actions.

Yes it can be a simple equation – understand what your customer values (VOC), eliminate waste (Lean) and be more competitive. But to do that, make sure you get the front end right using VOC and value stream mapping to get the target and alignment to individual actions.

Feel free to contact me if you’d like to discuss ….


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