Believing Lean Culture {align metrics from the onset} Where will the "human-side" of Lean hit you? Lets talk about experiences with talking LEAN vs. walking LEAN in Part II.
As is the case with any Lean implementation in a Traditional environment, culture (or more specifically culture change) will be the most difficult obstacle to success. While a company can hire consultants, develop work teams, and even begin Lean initiatives, if the company only "talks the talk", the initiative soon becomes just that, talk.
The transformation to a Lean Enterprise is not easy. Senior management while being driven by the labor force must lead the process. Goals must be established up front, so all are working toward the same future state. The difficulty is, Lean is not your parents' algebra. More accurately, it's the geometry you always tried to avoid.
Consider this
Our favorite algebra equation is: X + Y = Z The area of a triangle is: .5B * H
Think of algebra as traditional corporate metrics. Appearing to be simple and straightforward, industry-accepted, black-and-white. Terms such as absorption, capacity and cycle-time should come to mind. In this environment, goals are set which require machines to be run constantly in order to absorb minutes, regardless of the fact that needed product can not be run on those machines. This translates into running product that is not needed, consuming valuable material and increasing finished goods inventory to reduce variances on metrics.
At month-end (or quarter-end, year-end) the focus suddenly shifts to inventory levels and instantaneous inventory reduction is mandated. In this mentality, 2-1 = 1, no questions asked. People, materials, tools … all have the same weight.
Now consider our triangle. Here, 2-1 1, the whole is greater than the sum of the parts. Lets say "B" represents the "tools" of lean – Kaizen, Jidoka, Heijunka, Kanban, 5S, etc and "H" represents our people. Half the knowledge of tools combined with total commitment of the people will get you the area of our triangle, or true Lean Culture Change. If your focus is only on the Lean tools, you will not achieve success. The people part of Lean is more critical.
With Lean metrics, details are truly simple and straightforward. Measurements such as Delivery based on TAKT (true customer demand), Overall Equipment Effectiveness, Inventory Turns, and Level-Loading are consistently monitored to achieve continuous improvement in all areas. Inventory is not built up without (or by artificial) demand. There is no "mad rush" to deliver product at the end of the financial cycle.
Accounting, the dreaded A-word
So, here you are. You've sent managers off-site for hands-on Lean training. You believe they return as experts in Lean after only 40 hours of training. You might have even conducted some overview training with your direct labor.
Now, "lets get LEAN". Using the 7 wastes and 5S guidelines, you immediately see room for improvement. Everyone jumps on board when you project cost savings. Your first project organizing work areas and connecting disjointed processes is in full stream.
"Did you know Bob's machine is sitting idle today?" asks your Operations Manager. "Yep, sure is. We're ahead on that machine, so we moved Bob down to help in Assembly." Good response, Lean thought, cross-training staff, better utilization of the operator. "But that machine is costing us money, it needs to run!" …
The A-word strikes again. Corporate executives all agreed that Lean is the savior to the business. They may have even brought in consultants to educate everyone on LEAN MANUFACTURING. The problem? Lean is not a manufacturing tool, it is an ENTERPRISE tool, it is a BUSINESS SYSTEM. The manufacturing workforce is not the only group that needs to change how they do business.
Is there a solution?
Developing an A3 (business case), with all goals clearly defined, is a start. The A3 should follow the PCSAM method (Problem / Cause / Solution / Action / Measure). Remember the 5 keys to Lean Initiatives: Delivery, Quality, Cost, Safety and Morale, when creating a business case (defining the problem). Clearly define the current state, identifying wastes in the system (cause). Draw the future state using Rules In Use: highly defined work, clear and binary connections and simple and direct pathways (solution). Conclude the A3 with actions and measurements, including due dates and responsible parties.
Be upfront with executive management and ask the hard questions, such as "will there be problems if machines are shut down when not needed?" This will determine how many machines you use, how many shifts you schedule and how large your FIFO or Kanban systems need to be to achieve balance. Perhaps most importantly, be prepared to re-write yearly goals to co-exist with Lean Initiatives. This should even require executive management's commitment to re-writing the company's goals as well.
Companies that have unsuccessful Lean programs try to measure Lean Initiatives with Traditional metrics. Lean requires long-term vision, not the standard quarter-by-quarter evaluations and corrections. Executive management must adapt the Traditional long-term of "1-2 years" to the Lean long-term of "10+ years". There will certainly be short-term impacts, some negative (specifically when dealing with stock valuations and implications). But, if you have the long-range plan, those short-term impacts will come and go too quickly to jeopardize corporate performance.
Believing in Lean is critical for success. Traditional metrics can cause conflict, but metrics are not the only cause. A mentor of mine was fond of this analogy: there are rabbits, turtles, and foxes. Rabbits learn Lean, live Lean and love Lean. They jump on the process and run with it. Turtles are slow to change. They are patient, maybe even resistant. But once they see Lean in action, they will move in that direction and be as valuable (if not more valuable) as the rabbits. Foxes are the ones to watch. They pretend to believe in Lean, but never make the conversion. Foxes talk the talk. When times get tough, they will not walk the walk.
There is no magic pill for Lean initiatives. The Lean process requires time, commitment, and determination. Companies that can not envision the long-term commitment to Lean, and only use the tools for short-term gain, will achieve some limited success. However, without the culture supporting those tools, the Lean initiative will fail, becoming the "flavor of the week" that everyone knew would not last.
Albert Einstein once said it best, before Lean ever became a buzzword, "" Without changing our patterns of thought, we will not be able to solve the problems that we created with our current patterns of thought. "