Lean Management. feat. Oasis Simulation

Transcription

1 Lean Management feat. Oasis Simulation Please note the information contained in this document is proprietary and covered by copyright. You have permission to use the information contained herein on condition of explicitly referring to the authors and this copyright provision. how to measure/report your performance? as a taxi driver/company (5 minutes) what do you measure? how do you measure it? Slide 3 1

2 short waiting times fastest route shortest route Process Performance save petrol Cost Saving Income number of fares total revenue clean interior Image Safe / courteous driving Meeting & exceeding expectations nicest friendly route conversation Slide 4 Aims are: Generating Income Eliminate waste (of resources) Improving Business Performance Building Brand Image Meeting & Exceeding Customer Expectations Slide 5 2

3 How to measure: Save petrol Shortest route Fastest route Clean interior Pleasant conversation Nicest route Shortest waiting times Safe/courteous driving liter/km km/fare km/hr checks/day minutes talked sights/trip minutes/fare accidents/week Slide 6 Lean Management 09:00 introductions 09:30 traditional performance management OASIS simulation 10:45 BREAK 11:00 failure of traditional performance measures 11:30 the strategic imperative 12:30 LUNCH 13:30 towards Operational Excellence with Lean Management 16:30 Lean Management in 5 steps 17:30 END FHRLAP_SPM_v3.0 Slide 7 3

4 Lean Management 09:00 recapitulation day 1 09:15 towards a mindset for Operational Excellence dilemma 10:30 BREAK 10:45 towards a mindset for Operational Excellence team models, tower build 12:30 LUNCH 13:30 towards a mindset for Operational Excellence Safety Boat, Frame Build 15:45 BREAK 16:00 application to your own environment 17:30 END Slide 8 Balanced Scorecard Finance View provide shareholder returns Innovation View promote org l learning, growth & development Vision & Strategy Customer View satisfy & retain customers Process View build on internal strengths continuously improve Slide 9 4

5 Balanced Scorecard YESTERDAY financial lagging customer TODAY process leading (people) development TOMORROW Slide 10 (business) innovation & growth Balanced Scorecard Focus too much on financial performance (=lagging effects) More focus needed on achieving strategic objectives (= vision of future) Link needed between strategy & performance system (=alignment) conclusion: Need to envision the future not the past FHRLAP_SPM_v3.0 Slide 11 5

6 Key Lesson Performance Management needs to balance Financial, Customer, Process and Growth/Development indicators, (the 4 or 5 perspectives) or measures of past, present and future... but also indicators of effort and result. FHRLAP_SPM_v3.0 Slide 12 Critical Success Factors (CSF) What you must unquestionably do (i.e. effort) ór realise (i.e. output) to achieve a strategic objective inputs critical effort effort critical outputs outputs strategic objective Slide 13 6

7 Key Performance Indicators (KPI) Quantifying critical efforts and outputs: example budgets train employees competent staff best-in-class service delivery # training hours % completion of PDP's # qualified staff % match between job content and competences Slide 14 Balanced Scorecard Objective of BSC implementation should be that every employee (at every level) understands the relevant parts of the strategy has his/her own activities in line with the organisation s objectives spends more time on business-critical activities FHRLAP_SPM_v3.0 Slide 15 7

8 Balanced Scorecard Objective of BSC implementation should be that the whole organisation has scorecards from top to team to individual has a systematic performance management review policy that supports the generation of action plans at all levels is able to instantly communicate change can rapidly amend strategies FHRLAP_SPM_v3.0 Slide 16 Benefits of BSC Target-setting is done from every perspective Balanced follow-up on performance Enables fast reaction to changes Identifies business drivers Moves the focus from only financial figures to those figures that impact organizational performance Management focus is transferred from reactive management to proactive management FHRLAP_SPM_v3.0 Slide 17 8

9 Customer Value Proposition "best product" product leadership operational excellence "best quality/price" customer intimacy "best total solution" based on Treacy M, Wiersema F (1992) "Customer Intimacy and Other Value Disciplines", HBR Slide 21 Customer Value Proposition: Operational Excellence A combination of quality, price, and ease of acquisition second to none Few if any product/service innovations; do not cultivate one-on-one customer relations Aim for standard execution/delivery in high volumes Examples Dell Computers EasyJet McDonald Hertz Toyota based on Treacy M, Wiersema F (1992) "Customer Intimacy and Other Value Disciplines", HBR Slide 22 9

10 Customer Value Proposition: Customer Intimacy Does not supply what the market' wants, but what specific customers want Base their business on a thorough understanding of their customers and what they need Deliver products/services made to measure, at reasonable prices Examples McKinsey Amazon based on Treacy M, Wiersema F (1992) "Customer Intimacy and Other Value Disciplines", HBR Slide 23 Customer Value Proposition: Product Leadership Continuously strive to deliver innovative products or find new applications for existing products and services Always seek to discover new avenues Bring creative, new ideas fast to market Examples Nike Swatch Sony Apple Computers based on Treacy M, Wiersema F (1992) "Customer Intimacy and Other Value Disciplines", HBR Slide 24 10

11 Customer Value Proposition Operational Excellence Reliable products/services at competitive prices, made available with minimal cost and efforts The best quality/price" Customer Intimacy Best total solution, adapted to customer needs Not just a product/service but an experience" Product Leadership The best products" Products that continually supersede de "state-of-the-art" based on Treacy M, Wiersema F (1992) "Customer Intimacy and Other Value Disciplines", HBR Slide 25 Discussion Which Strategic Value Proposition do you offer? What does that imply for the way you are organised / structured? your management systems? your organisational culture? Slide 26 11

12 leadership vs threshold "best product" product leadership product differentiation operational competence customer responsiveness operational excellence "best total cost" based on Treacy M, Wiersema F (1992) "Customer Intimacy and Other Value Disciplines", HBR Slide 27 customer intimacy "best total solution" Key Lesson All companies and organisations must deliver a minimum level of operational excellence, AND customer intimacy AND product leadership. These thresholds may be called Operational competence Customer responsiveness Product differentiation FHRLAP_SPM_v3.0 Slide 28 12

13 Lunch Break 29 Slide 29 Why are you here? Lean Management concepts starting to be noticed & applied outside production environments First introduction to Lean Principles & Practices Slide 30 13

14 What is Lean? Toyota Production System (TPS) Revolutionised manufacturing (Ford vs Toyota) Now applied to different areas Google, Dell, Zara, Nike,... Product Development Supply Chain Management Software Development Healthcare Hospitality... Slide 31 What we want to show Push and Pull Systems Kanban Systems Thinking Flow Heijunka Yatai (work cell) and much more... Slide 32 14

15 Lean Lego TM Game Simulating a production line Hands-on Debriefing Results Credits: Danilo Sato & Francisco Trindade Slide 33 Hands On 1 st Step Let s simulate a production line... Task 1 Task 2 Task 3 Task 4 Task 5 4 teams 4 rounds of 40 seconds Follow the instructions Build houses 1 piece = house = Slide 34 15

16 Stay Motivated! DO IT RIGHT FIRST TIME QUALITY WORKER Slide 35 What went wrong? Slide 36 16

17 Visible inventory Muda (Waste) Over/under production Slide 37 Push vs Pull Systems Push System: upstream information Expected Demand Mass Production Economies of Scale you can have any colour you like, as long as it s black... (Henry Ford) Slide 39 17

18 Push vs Pull Systems All we are doing is looking at the time line, from the moment the customer gives us an order to the point when we collect the cash. And we are reducing the time line by reducing the non-value adding wastes. Taiichi Ohno, The Toyota Production System: Beyond Large-Scale Production, Productivity Press, 1988 Slide 40 Push vs Pull Systems Push System: upstream information Expected Demand Mass Production Economies of Scale Pull System: downstream information Adaptation On Demand Production Customer Requirements Slide 41 18

19 Kanban Physical device, that signals demand to downstream processes... regulates demand on a pull system... limits Work in Process (WIP)... aids visual control... is self-directing Slide 42 Kanban Process A Process B Buffer IDLE FULL WORKING Slide 43 19

20 Kanban Process A Process B Buffer IDLE WORKING Kanban Slide 44 Kanban Process A Process B Buffer WORKING WORKING Slide 45 20

21 Kanban Process A Process B Buffer IDLE FULL WORKING Slide 46 Hands On 2 nd Step Using Pull and Kanban Set up minimum buffers at intermediate steps Demand comes first Items are produced to fill gaps in buffers Task 1 Task 2 Task 3 Task 4 Task 5 4 rounds of 40 seconds Slide 47 21

22 Stay Motivated! DO IT RIGHT FIRST TIME QUALITY WORKER Slide 48 What went wrong? Slide 49 22

23 Unleveled Process Another type of waste Some people working more than others Mura (unevenness: stop/start or slow/fast ) Heijunka (production levelling / smoothing) Slide 50 Flow Ultimate goal is a leveled process Production line must be a continuous flow One piece is bought when one piece is delivered Sustainable pace Minimise fluctuations by reducing production batch size Minimise change-over times (set-up times) Slide 51 23

24 Systems Thinking Why does it still feel wrong? What are the other teams doing? What is the purpose of the system? a bad system will beat a good person every time... (W. Edwards Deming) Slide 52 Let s experiment Do we need 4 teams to build a house? Teams 1 and 2 have overlapping tasks! Slide 53 24

25 Multi-skilled worker Single piece flow Yatai (work cell) Slide 54 Using Work Cells Hands On 3 rd Step Each person builds a house Round of 160 seconds Signal (raise your hand) when you finish your house Build house Sell house Slide 55 25

26 Stay Motivated! DO IT RIGHT FIRST TIME QUALITY WORKER Slide 56 What went wrong? Slide 57 26

27 Kaizen Continuous improvement Reflect and adapt Learn by standardising Long term thinking Respect people Plan Act Do Check Toyota s real advantage was its ability to harness the intellect of ordinary employees (Gary Hamel) Slide 58 Improving the Process It s your turn to help us improve the process Slide 59 27

28 Hands On 4 th Step Discuss your own work process 1 round for each team Team A Team B Team C Team D Slide 60 Stay Motivated! DO IT RIGHT FIRST TIME QUALITY WORKER Slide 61 28

29 Results Push System Kanban Pull System Yatai Team s Process Slide 62 Is that all? We saw some of the practices Practices are contextual Underlying principles must be understood Slide 63 29

30 What is LEAN? Myth what TPS is NOT A tangible recipe for success A management program or project A set of tools for implementation A system for production only Implementable in a short- or midterm Reality what TPS IS A consistent way of thinking A total management philosophy Focus on total customer satisfaction An environment of teamwork and improvement A never-ending search for a better way Quality built in process Evolutionary Slide 64 Principles of Lean Specify what is of VALUE to the customer Identify the VALUE STREAM Create FLOW PULL demand Aim for PERFECTION: continuous improvement Slide 65 30

31 Types of Waste Muda poor process (waste, rework) Mura inconsistency / unevenness Muri unreasonable / burden (working beyond capacity) Slide 66 7 wastes of Manufacturing Image source: Slide 68 31

32 5s : workplace organisation Sort Straighten Shine Standardise Sustain (Seiri organise) (Seiton orderliness) (Seiso neat, clean) (Seiketsu immaculate) (Shitsuke discipline) Slide 69 Image source: Slide 70 32

33 Image source: _enhancing_safety_productivity_and_culture/ Image source: Slide 71 Image source: Slide 72 33

34 Image source: _enhancing_safety_productivity_and_culture/ Slide 73 Poka Yoke Poka = unintended error Yoke = to avoid Image source: Slide 74 34