Sustaining Lean

Sustaining Lean in Manufacturing Guest was Lonnie Wilson of Quality Consultants

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Lonnie Wilson, the owner and principal of Quality Consultants is an expert in Lean Manufacturing techniques and applications.

He not only instructs management professionals in the applications of these lean techniques; he is an on-the-floorimplementation professional. His new book, How To Implement Lean Manufacturing, was released by McGraw Hill, August 2009.

He is well versed in problem solving skills. He is an expert in statistical problem solving as well as logical techniques such as Kepner-Tregoe methodology. He is a Certified Six Sigma Master Black Belt and he not only utilizes the Six Sigma tools but he is an active Six Sigma trainer. He is very comfortable in the classroom and even more so on the factory floor. He is equally adept at working with top management as well as the line worker. He is an aggressive problem solver and with his 39 years in industry, Mr. Wilson has developed the ability to reduce complex problems to simple workable solutions.

In addition to his work in Six Sigma and Lean Manufacturing, Mr. Wilson has developed and taught classes in a wide variety of topics including many statistical tools such as DOE, SPC MSA, QFD and human relations skills such as Advanced Facilitation, Hoshin-Kanri Policy Deployment and Team Based Problem Solving, to name a few.

Quality Consultants Website: Http://www.qc-ep.com

Sustaining Lean in Manufacturing

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Joe Dager: Thanks everyone for joining us. This is Joe Dager, the host of the Business901 podcast. Participating in the program today is Lonnie Wilson, the author of "How to Implement Lean Manufacturing." Lonnie is also the owner and the principal of Quality Consultants. Lonnie, could you introduce yourself and tell me about Quality Consultants.

Lonnie Wilson: Sure, be glad to. But first, thanks for having me. This is truly a pleasure. Quality Consultants is a small consulting firm. We're here in El Paso, Texas and our principal clients are small, and some large firms. Seventy percent of our business is in manufacturing and another thirty percent in the service sector such as health care.

What we do is teach people how to make their facility a better money making machine and a more secure work environment. Most of our approaches follow the Lean philosophy.

Joe: Lonnie, you wrote a book on "How to Implement Lean Manufacturing." What prompted you to write a book?

Lonnie: Had a client in Mexico and our work came to a natural end, but I was very much befriended to the plant manager. He and I stayed in contact, and he would call me and ask me questions. I started firing off to him these incredibly long emails that would explain planning, Heijunka, or respect for people, or some Lean concept. Then one day, he says to me "Geez, Lonnie, this is great stuff, you ought to write a book." I went back through the emails and I had about 50 pages of a book, actually.

It was his request that prompted me to get going on it. Once I got going on it, it was relatively easy. It was a funny story that a friend prompted me to do something that I should have done some time ago.

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Joe: I found several things interesting about the book. So many people I talk to, they always talk about "Lean is a cultural thing" and that you have to write the book in a story fashion because that's what Lean is about. However, your book is really a "how to" book and you broke it down into the different segments of Lean very well. Actually, it was a cross between a fiction story and a text book, it was somewhere in-between. I found myself reading the chapters; I found them very easy to read. I also found myself going back and reviewing the chapters before I went to the next one.

Lonnie: Well, thanks, that's a great compliment. I always hear that people like to read it and get engaged in it. I intentionally wrote it that way. I wanted to write it so it was not quite, but somewhat conversational and people could relate to it at the individual level. It's also filled with stories. Those stories are real, live examples -- of course; you know the names and the dates and places have been changed for obvious reasons. Each one of those is a fact-based situation that some people went through. What I find is that resonates with some readers. The theory is nice and the application is a little bit different.

They want to get their fingers on some numbers and data and some real life circumstances. If you'll notice, some of those stories didn't go all that well. There were some circumstances where people had some serious problems. Those were alluded to as well. That, too, resonates with people.

So often, you read these stories and they seem to flow so smoothly, and in real life they just really don't go that way.

Joe: No, they don't at all, and I did enjoy that you told that side. You had case studies such as the alpha and bravo line which was interesting; the way that it was all broken out. If we

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have time, we'll go through that more. I wanted to direct something that I thought was interesting when I looked at it. It's that most books that I read, people will tell you what to do and different things; and how to implement it, and how to create this, and how to do it, but they don't spend a lot of time on how to sustain it.

We all know that that is the real secret in any type of process that you instill, is the sustainability of it, and you spent some time there. Was that on purpose?

Lonnie: Oh yeah, distinctly. If you recall, early on I tell the readers that we're not going to spend too much time on cultural change. Although we got a couple of chapters dedicated to it. If you'd like to, we can get back to that a little bit later. I do say there are two elements of cultural change that really need to be implemented up front and early.

One is the cultural commitment to continuous improvement and the other is also at the cultural level, the cultural commitment to sustain the gains that you achieve.

Nothing is more basic to making the business a better money-making machine and a more secure work environment than improving things and then sustaining those improvements.

I think those are the two foundational issues of what I call the "House of Lean."

Joe: But what makes sustaining them so difficult for people? You put a process in, you go ahead, and here we go. This is what we are going to do now. What makes that tough?

Lonnie: Boy, I'll tell you -- now that is a great question and I get asked that question frequently. It seems to be almost obvious that people would say "Well, OK, we made this gain, now let's sustain it." It's a whole lot better to build on progress than deterioration.

The truth of the matter is that people in real life -- people have tremendous, tremendous problems sustaining the gains. I think the single, biggest thing that I can put my finger on

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is the business' attitude towards problems. I find, particularly in the West, and I don't like to make a Japanese/Western dichotomy, but at some level there is.

I find, in the West, that we look at problems as a royal pain in the "tush." We don't want them. The fewer problems we have, the happier we are. Some of my Japanese clients, when they find a problem they almost celebrate it. They recognize they found a weakness in the system. The system is, therefore, deficient and now we have got a way to improve it.

They look at problems as opportunities to make their system better, and I think that carries over into then, how they finish up those problems. Once you have solved the problem -- to sustain it, there's a whole series of activities you need to do. You need to maintain it. You need to standardize it. All of that is just good old-fashioned hard work.

To me, that is the most fundamental thing that I find that makes people -- makes companies -- shy away from sustaining issues, is first, how they view the problem. I think the second thing is that once a problem gets fixed, it's very easy to jump to the next problem, because you don't have any more symptoms.

What happens is you take on the next problem. Everybody's interested in progress, so they want to make more and more progress. They forget that the last thing they fixed maybe isn't fixed completely. It's fixed enough so they don't have any current symptoms, but it's going to reappear at a later date.

That discipline that it takes to think through the possible future problems, put fixes in place for things that haven't even gone wrong; anticipate what might happen. That just isn't quite as sexy as moving onto the next problem and solving it.

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The third thing that I find that really prevents sustainability, is our system of goals and objectives. You'll very often find out that companies have all kinds of production and financial goals and profits, and those are far more important than quality goals. One quality goal we implemented in one place that was particularly progressive, was the goal of zero for things we really didn't do that well.

They made a list of the problems that reappeared and put them on the list of "things we didn't do really well." Then they made that a highlighted issue within the company. That company was the very best of any that I've ever worked at in my 40 years at sustaining the gains.

Joe: Now explain that a little more on how they actually did that? They made that a goal?

Lonnie: Well, they would have a problem, and if a problem reappeared, they would throw that in the "things we really didn't do that well" category.

In fact, in this case, the plant manager was also the division manager over several plants. He made it a particular point to facilitate that next problem solving session. If a problem reappeared, that became a problem in and of itself. They said, "OK whatever was wrong about our system that allowed this problem to reappear, we want to fix. It's important enough to me, so I'm going to head up that team." As soon as a problem reappeared, they would jump on it with both feet.

Joe: I like that. Another item that I saw mentioned in your chapter on sustaining the gains is transparency. You use that word I think in place of visual management, or visual systems. Did I interpret that right?

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Lonnie: Oh exactly. Yeah. I think that transparency is a huge issue in problem solving.

Think about a different kind of problem, a metaphor -- let's say you cut your leg. Of course, you want to recognize that there is a problem and you want to fix it as quickly as possible. You want to fix it as quickly as possible because there is always a mess associated with it, and of course, you're losing blood. Well, that's what a problem is like in a plant. A system of transparency allows you to see the problem as quickly as possible.

Plants that have good sustainability, always, without exception, have good systems of transparency.

For two reasons: One is they can find the problem right away, they can fix it, and they can catch it while it's a small problem. The second aspect is that not only do they have the system of transparency, but they have problem solving done at the very lowest level.

The line worker, for example, can see the problem and then jump on it and fix it, before it becomes a great big problem. Before you, in effect, lose a lot of blood and create a mess on the floor, so to speak.

Joe: Now, you talk about that -- the ultimate purpose, then, of transparency is to be able recognize problems as early as you can in the process.

Lonnie: Exactly You also talk about Rapid Response PDCA, what does that different from just PDCA, or why did you use that term?

Lonnie: Let me go back to transparency, just for a second. In transparency, the system allows you to tell, first, that something has changed. It is a well-accepted piece of the Toyota production system, or Lean, that the whole system is a hypothesis test. The hypothesis check is: Is the system operating normally or not?

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Your system of transparency will tell you that it's not operating properly. That means, "Oh, we've got to go do something." In Rapid Response PDCA, first you have the system of transparency; second you have people who can jump right on the problem. You don't catalog them. You don't put them together. You don't find an engineer. You don't prioritize them. You just fix them.

With Rapid Response PDCA, problem solving is driven down to the lowest level. They have a good system of transparency that will tell them when something has really changed so that they can respond to it quickly.

Joe: I like your description. I talked to Michael Balle one time, and he explained the use of Andon and how when something went wrong, then the manager stepped in. Then they went back and forth and looked at that as an opportunity for quality improvement. Not as a mistake. That is what you're explaining there. That as something happens it becomes a training opportunity. You go ahead and you fix it, and continue to improve during that cycle. Its part of the cycle, it’s not necessarily this big event where you have to fix this problem, and it is what you do.

Lonnie: Yes, exactly. The benefits from problem solving are immense. If people treat problems as bad thing, as an obstacle, as a sign that we're deficient, then they become hidden. They don't go away, they just become hidden. They will reappear at some point in time, in a worse form, always. The best thing to do is take them on as quickly as you can. To do that, you need to know they are there. That's what the system of transparency does. Then, as your discussion with Michael went on, then you've got some people there who can work on that problem. Not only can they work on it, but they've got a support system. One of the

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elements of an Andon system, which is part of the system of transparency, is an escalation procedure. Whereby, the car -- if we're in an assembly plant, for example -- is coming down the line and they have some type of a minor problem, if the operator can take care of it, he just fixes it. If he can't, then he pulls the Andon cord and he gets some support in some time or another.

They actually have a floor marking for where the problem needs to be solved by the operator. If it isn't, he asks for help and the supervisor shows up. He doesn't show up in condemnation fashion, he shows up in an instructional fashion. He's there to help and he's there to teach. That is a dramatic difference from the culture that I grew up in, in my first twenty years in industry.

Joe: What I liked about that description of it is that when someone sits there and pulls an Andon cord, we're always thinking of this whole line of thousands of cars just stopping. That's not what happens. It's a time that you reflect and look at what is going on, and things are still continuing. You fix the problem and then you move on. There is just an issue that I need help with.

Lonnie: Exactly, asking for help is a pretty healthy thing in most environments. You want to do everything you can to encourage that. Unfortunately, that is not necessarily the norm.

Joe: The other thing that I think that is interesting is that when you talk about sustainability, I see a lot of standard work being emphasized. Is that true?

Lonnie: As a matter of fact, a fellow once asked me when you go into a company, how do you tell if they are going to have a problem with -- and one of the questions was

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sustainability? You can look at a handful of things, and one of them is their standard work. A company that has good standard work usually has good sustainability. Standard work is nothing more than sustainability for this part; doing the same thing, the same way, in the same fashion, on the same cycle time, using the same materials on this part.

That's what you want on the long-term.

Conversely, if you go into a company and they have problems with standard work, you can almost be certain that they will have issues with sustainability.

Joe: Do you think standard work dehumanizes people?

Lonnie: Oh no, not at all. As a matter of fact, I think it very much humanizes it. In fact, the real purpose for standard work is so that you can improve. Even though people think about this rote robotic aspect of standard work, the beauty of standard work is that after you have implemented the standard work, your next obligation is to find a way to do it better. On the one hand, you start with this rote procedure, and then you move into the imaginative problem solving aspect. All workers are not only expected to do that, but encouraged to do that. They'll look at the standard work and they'll think about "How can I do this better? What's a way to finish this off a little more smoothly?"

Standard work is a part of the culture, and improving standard work is part of the culture, you put those two things together and you really get the best of both worlds.

Joe: I picture the standard work well, the transparency and the visual, but you emphasize to sustain something that you have to do audits. What did you mean by that?

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Lonnie: Well, again, there's a difference here in what I'm talking about there and the classic view of audits. Particularly, the audits I grew up with; things like ISO9000 and TS16469. Altogether too often, those audits are really focused at trying to find something wrong with the system. That's really not what you want to do with audits.

With audits, you want to improve the system, and you want to teach. You not only find things that are going wrong, but you find things that you can improve upon. I think the key to audits is to get everybody to do them -- top to bottom, left to right -- and having even a system of management audits.

Some people, who are familiar with some of the Japanese techniques, will be familiar with the term "Hoshin Kanri Planning." Hoshin Kanri Planning is a completely cyclical system, and part of it is top-level management audits. I don't mean some manager delegating an audit to somebody.

I mean going out on the floor, measuring the cycle times, checking the quality, getting involved with the nitty-gritty, measuring things, evaluating things, writing the report, following up on the report, doing the whole audit.

In doing so, then the managers get a new perspective of what's going on, they learn exactly what's happening on the floor. Therefore, they can become really engaged in it with good, first-hand knowledge. The audits that I talk about doing there are deep and pervasive, as opposed to some of the audits -- compliance audits -- that we're all familiar with.

Joe: What kept sticking in my mind was analogue. In that it's a continuous process; that we're auditing, that we're doing these things, that an audit isn't a snap shot.

Lonnie: No, it isn't. It's a continuous process. The findings of the audit are then cycled back into the continuous improvement process and away we go again. It's a cyclical and

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pervasive process. It's not just something the quality people do; it's something that every department does, top to bottom.

Joe: We talked about culture at the very beginning of it, but is there a culture that you can recognize right away that doesn't fit? Is there a way that you can really determine that there's truly a commitment when you go into a place, that you will have an opportunity to improve it? Are there telltale signs that this isn't a good cultural fit?

Lonnie: Well, if a business is surviving, they have some type of a culture that works at some level for them. Every culture that I've worked with, and that's really what we're talking about here, when we're talking about Lean, or Six Sigma, or re-engineering; you're talking about cultural changing events. I find all of them have some deficiencies, all can be improved, but all of them at some level are working. It's not a matter of going out and changing your culture from Culture C to Culture A and away you go. You have to look at the elements within the business that work for the culture.

Let me give you a simple example. If you are in a manufacturing business, you have an awful lot of things that are dictated by time. If you're not careful, you have an awful lot of crises. In that environment, you need some people who are really good at making quick decisions.

You almost need an element of management that has the style to be able to lead in a crisis. Not that you want to lead that way all the time, but when a crisis presents itself, you need to be able to do that.

If you are in an accounting firm, you probably don't have any crises. You don't need these people who can take charge and have a military style of leadership as one of the many styles

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that they have in their toolkit of management skills, so to speak. Different cultures require different traits, and leadership traits differ.

You can very often measure the health of a culture just by talking to the people. It's amazing what you can learn. I like to go through a facility, and I like to say I'd like to start in the boardroom and talk to them about what supposed to be happening, and then go out there on the floor and talk to the operator, and find out what's really happening.

Then on my way back to the boardroom, talk to the first line and intermediate supervisors as to why there is a difference between what the boardroom sees and what's actually happening on the floor. With a few penetrating questions, you'd be surprised at how much you can learn about the culture that they have there.

Joe: Certainly in the way they phrase the answers to you. But in your book you have a special test for commitment, what is that about?

Lonnie: I'll tell you! That's one of the more difficult things to really evaluate in a business, is how committed are the managers and how committed is the top leadership. I don't think I have ever been involved where somebody has said, "Well we're just not really committed to this." Everybody thinks they're involved. The level of commitment that it takes to make a cultural change the size of a Lean cultural change is huge. The top management has to approach this with a vigor and commitment that would resemble a religious fervor almost. They have to think and dream about and eat and talk and sleep about Lean if they really want to transform their culture from where they are to a Lean culture.

I came up with this test for commitment and it allows the commitment to be measured in a much more objective way. One of the questions is "What are you studying about changing

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your culture? What you studying about becoming Lean?" Most managers will tell you, "I read Wilson's book," or "I read Balle's book.“ If you are involved in Lean, you can say, "Well, OK. I know about that book, but you know what? There's a lot more about Lean than there is just in that book," and give them four or five other books on Lean.

You can just ask yourself, "How many books have you read to develop the understanding that you have about Lean?" Not to mention implementing it, and following up on it. Most of them consider that an adequate approach, but you find out it just isn't.

The commitment test allows people to make much a more objective evaluation of how committed they really are. Quite frankly, I want to tell you, Joe, it is very, very sensitive test and it is really tough to do. But if you do it right -- and I've got an outline in my book on how to go through it properly -- you can get people to understand the level of commitment they have. Once they have got that understanding, then it is much easier topic to take on with the top management.

Joe: Well, you touched a point there that was very interesting to me, is that Lean seems so simple. It's like you talked about before with me a little bit -- line balancing, product leveling, and the visual tools. After you get passed some of the Japanese terms; the Kanban and Hoshin Kanri, it relatively so simple, so why can't you just implement it and move forward with it?

Lonnie: Yeah. It does. As a matter of fact, I'm helping some colleges work on their curriculum, particularly in engineering and in business to incorporate Lean into their curriculum. They don't see it as being technically very challenging. The truth of the

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matter is, I think technically, it probably is not very challenging. One of the things that is very, very prevalent in Lean is discipline; the discipline to do standard work, the discipline to maintain your transparency, the discipline to do preventive maintenance. All of those discipline, and any time you get into discipline, it's an issue.

You are talking about continuity and sometimes it is almost boring. The other part of it, besides the discipline, is that it looks simple so people treat it lightly. I one time heard a quote by Thomas Edison and he said, "Opportunity is missed by most people because it is dressed in overalls and looks like hard work." That's what Lean is. Lean looks like it's dressed in overalls, and it is hard work. Very often, the opportunity to do that is missed.

The other thing I find is that to implement Lean, you need to have a really, really good plan. I find in businesses, planning is very often a weakness they have.

Consequently, maybe it's those three things put together; the emphasis on discipline, which isn't easily accomplished, and the business about hard work, and planning. Those are all three things I think challenge an awful lot of businesses.

Joe: You gave a five-step process how to implement Lean for lack of a better word in text-book fashion. "Let's do level one first. Here is what level two is and..."

Lonnie: Yeah. I find that that really resonates with people in the field. I've gone through that prescription with a variety of firms. At the floor level, they kind of marvel at "Well, this isn't all that complicated. Why didn't we do it before?" It usually goes back because of discipline. "Well, we didn't have the discipline to do it." Then that goes back to; "Well, we really didn't have the management support to spend the time to do it."

"Why didn't we have the management support to do it?" “Because, we really aren't focused on problem solving." Everything really goes back to the management and the leadership at the end.

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You mentioned something that made me think of something else, too, and that was "Why is Lean hard to do?" One of the things that I find universally true is that Lean frequently is viewed as just as a "materials issue," as a "just in time." When Toyota Production System first became common jargon, people referred to it as the "just in time" manufacturing system.

In "just in time," they were talking about getting the right materials to right place at the right time. Some people still hold that view, but what they missed completely was this "just in time" manufacturing system was built on and incredibly strong quality system.

Many, many companies, I find, have to go back and work diligently on these foundation issues of quality to make their quantity system work. Just like you can't build a good house on a lousy foundation, you can't build a Lean house without having a good foundation of quality.

I have not had a client yet in the last 20 years that we have not had to go back and do substantial improvements on their quality system to make the rest of the Lean system really work.

Joe: Is there something that I left out that you would like to mention?

Lonnie: What I really stress with any new client is the absolute need for just strong leadership. So many people focus on all the technical whistles and bells of Lean implementation -- or it could be re-engineering, or value engineering or Six Sigma or whatever cultural changing events you want to implement in your business. It could be any of those. The tools and the techniques are, of course, a part of it. You can't underestimate that they are a part of it. The thing that makes it succeed or fail is always the level of leadership and management commitment. I just can't emphasize that enough.

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You can have all the technical tools in the world, but if it's not lead and put together in a plan that meets the needs of the business and turns the business into a better money-making machine and a more secure work environment, then all else is lost.

I have seen a number of cultural-changing issues fall far short of their objectives. In virtually every case, the issue was really leadership. It was not so much the people at the worker-bee level and it was not so much the tools. It wasn't even really the approach they took, whether it was Six Sigma or Lean or re-engineering. More than anything, it was the leadership and that is something that I can't emphasize enough.

Joe: I would like to finish up by thanking you very much. I enjoyed the conversation. If you would like to find out more about planning, his book can be found. It is called "How to Implement Lean Manufacturing." You can find it on Amazon, and of course the McGraw-Hill website has it. If you would like to learn more about Lonnie’s company, Quality Consultants, you can find them at www.qc-ep.com. The Business901 podcast will be available, of course, on my podcast site and also on the Business901 iTunes Store. So again, thank you very much, Lonnie.

Lonnie: Thank you.

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Joseph T. Dager Lean Six Sigma Black Belt

Ph: 260-438-0411

Fax: 260-818-2022

Email: jtdager@business901.com Web/Blog: http://www.business901.com

Twitter: @business901 What others say: In the past 20 years, Joe and I have collaborated on many difficult issues. Joe's ability to combine his expertise with "out of the box" thinking is unsurpassed. He has always delivered quickly, cost effectively and with ingenuity. A brilliant mind that is always a pleasure to work with." James R.

Joe Dager is President of Business901, a progressive company providing direction in areas such as Lean Marketing, Product Marketing, Product Launches and Re-Launches. As a Lean Six Sigma Black Belt, Business901 provides and implements marketing, project and performance planning methodologies in small businesses. The simplicity of a single flexible model will create clarity for your staff and as a result better execution. My goal is to allow you spend your time on the need versus the plan.

An example of how we may work: Business901 could start with a consulting style utilizing an individual from your organization or a virtual assistance that is well versed in our principles. We have capabilities to plug virtually any marketing function into your process immediately. As proficiencies develop, Business901 moves into a coach’s role supporting the process as needed. The goal of implementing a system is that the processes will become a habit and not an event. Part of your marketing strategy is to learn and implement these tools.

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