Archive

Posts Tagged ‘Innovation’

Waterfall Design (QFD): Looks Good but Watch Your Step

February 24th, 2013 4 comments

Pretty but Watch Your Step

Waterfall design looks so good on paper.  You start by defining customer requirements and then each step naturally leads to the next until the service is offered, product produced or new process is launched.  A QFD is a waterfall design process and it expresses this natural progression as linked matrices.  Anyone who has ever seen a presentation for QFD sees and accepts the logic of the waterfall concept.  Why then is it that what seems like a smooth running machine usually ends up a painful and burdensome process?

The problem is that elements of a product or service are usually put through in phases to keep the whole work flow running.  If that weren’t done, the Company would have the vast majority of the people in the process idle having either finished, or still waiting for their turn, to contribute to the final work.  Such massive underutilization is no way to run a company.  So we avoid the poor utilization by breaking things down into pieces and sending them through the process in components.  The pressure to maintain utilization and the resulting flow of components creates a tremendous problem in waterfall design processes.

The problem is the series of rework loops caused by gaining buy-in and responding to feedback from internal customers. As each segment flows through the maze of work, each functional area has valuable feedback and expects to be heard.    Once again, using the QFD process as an example, as the output of each matrix becomes an input to the next matrix, the new parties have comments.  And as such, the input to a particular matrix gets kicked back along with the new functional area’s thoughts and comments. The water is now flowing up the waterfall!

Now the problem starts to compound when you have more than two matrices in the process.  When its just two, the rework and new work cross and loop until their joint work product meets exit criteria.  They are just handing off to each other like two people having a catch with two balls.  Every now and then one player may have both hands full but the waste of his compatriots empty hands is short lived.

Download WP “Design Basics – QFD Overview”

But once past two players, problems arise quickly.  As a simple example, let’s imagine three matrices starting with product definition.  Product definition provides input to design which, in turn, provides input to Service Operation or Manufacturing, as the case may be.   Now imagine, just like when there were two matrices, that the output of the first matrix (i.e. product or service requirements) goes to a design team which provides feedback.  They remain in equilibrium until the design team’s output goes to a production or delivery team which has its input.  As Player 2 passes reworked Cycle 1 to Player 3, they are also receiving reworked Cycle 2 from Player 1.  It isn’t long before a ball hits the ground.

Irrespective of how fast everyone can be, if you add enough matrices or steps, the process breaks down.    What usually happens is that Player 1 ends up with a stack of balls on the ground around him.  The system was designed for one set of requirements to flow smoothly.  When multiple rework loops occur, the perfectly designed machine collapses under its own weight.

There is no easy and universal problem for this breakdown.  Some possible solutions are for fully integrated teams representing all functional areas to work on components together through all phases.  A design “cell” if you will.  Another solution might be to design from the back to the front.  And yet another might be to simply accept underutilization as a cost.  But whatever the case, you should be aware and step outside the box before you drown in the waterfall.  If you have comments, please contact me.

Productivity – The Coming Golden Age of Continuous Improvement

February 10th, 2013 Comments off

A Drive for Productivity

Last week I wrote a post entitled Value Creation for Private Investors that went largely ignored as it was one of my lowest viewed posts of the new year for a Monday when most of you tune in.  The idea about which I wrote was a revelation to me but it was still nascent at the time and thus very undeveloped and weakly presented. But it gnawed at me and so it kept turning in my head.  And now it pops out again this week hopefully a bit more developed.  The idea is the transition we are making from creating the illusion of wealth with financial engineering to needing to truly drive wealth with productivity gains which will make for a golden age in Operations and Operational Excellence.

As a nation, we will flourish based upon our ability to drive productivity.  You see wealth, as measured by GDP, during the majority of our lifetimes has been driven by population growth.  But as our population growth slows, wealth will only be created by increased productivity.  This transition has been hidden from us for some time by the illusion of wealth creation brought about by high capital liquidity and inappropriately priced risk which eventually lead to the bursting of a financial bubble.  But with risk being more appropriately priced, the illusion is gone and we are now faced with long term slow growth and the only way to stoke it is with increased productivity.

To drive the growth in productivity, I wish to cite a recent blog post by GE’s Jeffrey Immelt a portion of which read as follows;

There are four new drivers of productivity, and success in each depends on the technology and talent we develop. The first is how the sheer volume and increased access to shale gas in regions around the globe is changing the energy debate and the balance of energy power. It would require real infrastructure and pipeline integration between Canada, Mexico and the U.S., but North America could achieve energy independence within 10 years. The second driver for dramatically increased productivity is applying the lessons of social media to the industrial world and building what we call the Industrial Internet. By owning and connecting the analytical layers around industrial products – and using real time data to extract real timeknowledge – we can improve asset performance and drive efficiency. The third driver is speed and simplification because the only way to serve our customers better and compete in a complex world is by working faster and smarter. The last productivity driver, and related to the other three, is the evolution of advanced manufacturing. Manufacturing excellence, forgotten for too long, is once again a competitive advantage.

Drive Value with OpEx

Now when you look at this argument about from where we will get the productivity growth, a problem jumps out.  Namely, we have to generate non-population related productivity gains with a population that isn’t geared to Immelt’s productivity drivers.  Our younger citizens certainly are better aligned and skilled but as population growth slows, they will be the minority.

So guess what — the knowledge of how to improve services, products and processes is really valuable.  Now I’m not talking about how to write a project charter or write up a SIPOC.  I’m talking about revolutionizing energy with process innovation in the extraction of natural gas, the development of the cloud so we can jettison underutilized servers from expensive IT budgets and citizen publishing of information so knowledge flows freely and into every nook and cranny of the population instantaneously.  Imagine – those have all happened in the last five years.  Those are the types of improvements that transform an economy.  But there is plenty of room between a project to save an AP process two days and reinventing the extraction of fossil fuels.  And every time a new industry is targeted, all the operating processes below the top level change will also be looking to improve.

Can you imagine where these big seismic changes will happen next?  How about redesigning education so everyone has access to knowledge inexpensively?  Or health care where we can all see an insanely low level of simple IT tools that if applied would eliminate gobs of waste.  Or all levels of government where we have constantly rising costs with little measureable gains in services.  These trends will continue.  They must continue or we, as a nation, will slowly lose our global relative wealth.  And I just don’t think Americans are ready for that.  But the changes will be disruptive.

In the race to drive wealth through productivity gains, we will see the greatest impact in processes and services simply because they are the largest percentages of the economy.  I’ve already named drilling services, the cloud, newspapers & magazine publishing, health care and education as service companies which either have gone through or are poised to go through significant redesign. What of the process side?

Systematically Driving Value with OpEx

Well I think we are going to see work get reinvented.  My former colleague at Qualtec, Mitch Lawrie, is working on software to focus management on results versus activities and my recent blog on the subject drew significant attention from many of you.  We have worked with several clients in financial services, telecom and transportation which are redesigning long accepted processes to drive greater than 50% reductions in key process cycle times by making them leaner, reducing complexity and capturing information better as well as analyzing it for knowledge.

To return to my original post, my “aha” moment was that I was at a private equity conference where investors of all sizes where lamenting they could no longer make easy money.  That easy money was driven by a combination of capital liquidity, high tolerance for risk and poor quantification of that risk.  It was a recipe for a bubble.  If you bought an asset, held it and sold it before the bubble burst, you made money.  If it was levered, you made a lot of it. The funny thing is that private corporate investors weren’t the only players at the casino. We were all there with real estate and stock portfolios.

But that is gone now.  And as we look into a new environment, we realize we are facing the longer term challenge of slowing population growth and an aging population that isn’t skilled at what is needed to drive the sort of productivity gains needed to maintain historic wealth creation.  To create wealth as a country, we now have to earn it the hard way.  And since there are only so many hours available in the work force, it means we have to work smarter.

And a clearer definition of that “aha” moment brings me to the message in this post.  We figure out ways to work smarter – whether it is a fifth level sub-process or an entire industry.  The result is that we are entering a golden age for people focused and skilled at how to work smarter.   We have the opportunity to make great contributions to our economy.  I urge you all to THINK BIG.  If you’d like to discuss, feel free to contact me.

Michelangelo’s Principles of Design Thinking

January 27th, 2013 Comments off

Perfect Design?

Some time ago, I read an article about great art and artists.  The author recited a lengthy list of what constitutes great art.  As I read it, I thought about how his arguments applied to industrial design as easily as they did to the Renaissance.  Recently, I’ve been engaged on service design problems and I decided to write down as much as I could remember from the article as principles by which to work on these engagements.  Here are the principles I documented:

1. Simplicity of Design is Clarity of Purpose.  So often, I look at a product or service packed with functions or features and walk away without bothering to learn to use it.   You would think the default would be the simple version but when people try to get creative, they somehow feel packing more into an essay, a painting or a product makes it better.  It doesn’t   Often, it simply masks the work has no real purpose.

2. The Best Designs Can’t Be Improved Upon. Imagine a math proof with either a mistake or that is overly complex.  In time, it will be improved upon and erased from the text books.  Imagine doing something so well that you leave no room for improvement. Similarly, imagine designing a house or piece of equipment that is as comfortable or useful today as it was five hundred years ago.  Won’t it be as comfortable five hundred years from now?

3. Design Starts with Defining the Right Problem. Developing the right solution for the right problem are two design problems in one.  You are better off making sure you’ve properly defined the problem before working on a solution.  Imagine if Columbus had designed a ship capable of dealing with the end of the earth?  Obviously, Columbus redefined his problem.

4. Getting Design Right is Hard Even Though It Looks Easy.  This one is really important…especially when you juxtapose it with #1 above.  Sometimes you look at a product or service that has been elegantly designed and think – so simple, I could have done that.  Well, you probably couldn’t because it was really hard.  Imagine the simplicity of the light-bulb  yet it took Bell 1,000 attempts which he called “steps”.  Each failure is a step forward.  But there are many failures before there is success.  It is hard even if the final product is such a perfect answer that it appears to have been obvious.

5. Nature reflects the Greatest Designs.  Look around at nature.  It is especially well designed.  A trout is perfectly designed to thrive in a cold mountain stream feeding on a bustling colony of insects which in turn are perfectly designed to live between the rocks of the same stream.  Good designers copy nature.  And their work product is often described as “natural”.  One of nature’s more relaxing elements is symmetry and repetition.  Gardens are more peaceful when you don’t have one of everything but repeat patterns of colors and plants.  Isn’t there an amazing elegance to a DNA strand?

6. Treat All Your Designs as If They Were a Mistake…And You Knew It Would Be.  In other words, do it over because you’ll do it better.  In doing so, you’ll look for your mistakes and try to correct them.  That is the hard work part of it.  And since no one sees every iteration of your design, they think it was easy.  I think recognizing you can always do better is what is particularly scary about being a parent – there really isn’t a second chance.  And since you know you’ll make mistakes, you just hope your children will one day forgive you.

 

Download PPT on Design Basics

 

7. A Great Design Can Be Really Scary.  More than likely, a great design so redefined the problem that the new solution won’t look anything like what current solutions look like today.  We can see today’s post-secondary education model is broken.  What will it look like in 20 years?  Would anyone in the ‘60’s have believed you if you told them that to get their news and information, they’d be reading digital content written by ordinary citizens in place of listening to Walter Cronkite?

8. To Design Well, Seek Collaboration…and Competition.  Something happens beyond ourselves when we are with each other.  It happens whether we are working together or competing.  Humans drive each other to excel.  That is why cities are so creatively vibrant. They explode with both collaboration and competition.  It is why you see two rivals push each other to excellence in sports…whether they are on the same or rival teams.  To design well, commune.

I hope my engagements yield great solutions for my clients.  I hope I help them see ways of satisfying their customers and stakeholders they’d never thought.  I hope these principles help me get them there.  Feel free to send me your’s.

VOC to Process Improvement to Innovation – The Round Trip

January 15th, 2013 Comments off

Roundtrip to Innovation

I’ve written dozens of articles about VOC, Process Improvement and Innovation on this blog.  Most have dealt with those subjects in isolation.  A few have related them to each other.   Really, I should have been discussing the entirety of the system more for the development of each is limited without the development of all.

This became apparent to me when I found a blog post where a portion of the post tied the three together so well I felt compelled to share it with you.  Specifically, it is written by Bradley (Woody) Bendle and it is posted on www.bx.businessweek.com.  The link to the specific post is as follows:

http://bx.businessweek.com/voice-of-the-customer/view?url=http%3A%2F%2Fwww.innovationexcellence.com%2Fblog%2F2012%2F09%2F17%2Fyour-consumers-are-valuable-not-fickle%2F

The blog post is entitled “Your Customers are Valuable – Not Fickle!” back in September 2012 and the portion that really hit me is shown below –

The great recession has profoundly changed the consumer, and it is highly unlikely that they will return to the behaviors and patterns of yesteryear. Many experts feel there is now a “new consumer normal” that is very different from what we had experienced in the past. In a recent Forbes.com article, Pam Goodfellow from BigInsight asserts that “the clear turning post for consumer behavior during the last decade came with the ‘Great Recession.’ Shoppers went from ‘spend now, worry later’ to an ‘abort spending, worry, worry, worry’ mindset.” The folks from the Future’s Company additionally provide their own perspective about this era of the new normal. “Consumers everywhere … are working from a new orientation about what they want and how they buy… [They] are now battle hardened, having found ways to survive and even thrive on the new opportunities a more competitive market has yielded.”

I think nearly all of us can relate to this “new normal” consumer mindset on some personal level. Who hasn’t had to make adjustments in their consumption over the past several years? If so many of us have had to make our own (sometimes pretty significant) adjustments, why aren’t we seeing more significant changes in how many existing businesses go to market?

There are a number of great books that provide valuable insightful about this phenomenon (e.g., Leading The Revolution by Gary Hamel, The Reinventors by Jason Jennings, Brand Relevance by David Aaker and Ten Rules for Strategic Innovators by Govindarajan and Trimble) to name a few that I highly recommend. And while these books address a range of topics with fabulous expertise, you can essentially boil their key underlying insights to the following two things.

1) Deeply understand you customer’s needs, and
2) Continually innovate.

We all need to face the fact that success is no longer guaranteed for those simply committed to “getting better” at what they know how to do. Twenty and thirty years ago, process improvement and cost containment could make one a titan within their industry. Those days are pretty much gone for good; much in the same way that today’s consumer will never be the same as yesterday’s consumer. 

A PowerPoint framework for a VOC maturity model

I just want to emphasize that VOC, Process Improvement and Innovation are intricately linked. They are not separate topics.  They aren’t implemented without thought to the other two.  You can’t get customers to give you their preferences and work with you on iterations of a product or service if they don’t see value in what you do for them.  You can’t have that sort of relationship if your processes aren’t delivering on your stated promises. And without the trust built by meeting those current promises, you can’t innovate new products and services as they will never be accepted.  VOC, Process Improvement and Innovation. They are the Trifecta.  Contact me if you wish to discuss this post.

Innovation Careers

July 4th, 2010 Comments off

The only think constant in life is change.  As unsolved project inventories grow due to the limitations of known skills, companies CI programs face the challenge of looking differently at problems.  The natural path is to look at Innovation tools.  I’d like to share an article from Harvard Business Review regarding Innovation (http://hbr.org/2009/12/create-three-distinct-career-paths-for-innovators/ar/1).  Innovation is a very broad topic but one that is certainly touching on CI professionals.  The article’s basic principle is that Innovation career paths can be structured with different skills and experiences.  The introduction of innovation skills in a CI professional’s career can be similarly structured.  This is different from what is offered in the market today.  Today you have Introduction courses, basically an awareness session, and deep dives for those seeking a sophisticated level of expertise.  If you are increasing your efforts around Innovation, you may encounter the challenge of creating a set of applicable tools according to the problems an individual encounters.   I found the article thought provoking and thought I’d share it.