LMJ Issue 13

Moving forward: the future of lean

This issue, the last of 2011, analyses new trends, tools and types of training, offering a preview of what tomorrow will bring.

Issue 13 November/December 2011 www.leanmj.com

In this issue: Beyond 5S: Joseph Ricciardelli, a MSc professor and founder of Tecla Consulting, introduces some of the new tools available to practitioners.

A model factory to help a struggling territory : This innovative form of training might represent a new way to show academia and businesses how to work together to deliver change on a wide scale.

What the future holds: What are mature lean organisations going to do next? Jon Alder of Rexam tells us about his company’s plans for the future.

Lean diary : In this new regular column we follow Serbian manufacturer SCGM as it takes its first steps towards excellence through a programme of continuous improvement.

The Lean Management Journal is supported by the Lean Enterprise Research Centre, Cardiff Business School

Dear reader, As we approach the end of 2011, there is a lot to think about with regards to the year that’s been and what 2012 will bring. Times are changing and an increasingly complex economic situation threatens to push Britain and the rest of the world into another recession. Many people may have hoped that the downturn might have become a distant memory by now, but it is far from the case. It seems world leaders don’t fully understand the need for a whole new model to ensure economic stability.

Things need to change otherwise thousands of billions of Euros, which are being used to bail out troubled Eurozone states, won’t be enough to halt a collapse of the entire economic area. What is needed is a different approach altogether, one that keeps performance and waste reduction into account, at all levels and in all environments.

In the final issue of the year, LMJ looks at the future of lean. Although some principles, like cultural change and people involvement, remain the same (they have for decades), there are always new ways to approach your continuous improvement journey on the way to excellence and efficiency. This issue of the journal provides a chance to see the future plans of a seasoned lean organisation on page 42, as well as demonstrating new and innovative forms of training. Page 18 takes you all the way to Italy to check out a model factory that hopes to change the future of a territory suffering from a crippling productivity crisis by training the next generation of lean practitioners.

If we don’t want to see more of the social unrest we are experiencing around the world, we have to make sure we adopt a new way of thinking that has collaboration and togetherness at its core. We need to adopt a considered plan for improvement and not wander blindly down the road of reactionary change. We have to make change that benefits everyone around us or at least deliver a utilitarian outcome to provide the greatest good to the greatest number. Tell me if I am wrong, but aren’t respect for people and engagement two fundamentals of lean practice?

It is with this spirit that we are introducing a new section, the Lean diary. We found a pioneering Serbian SME, SCGM, which is just starting out with lean. We’ll be following the company’s journey over the next few months, encouraging you all to share your comments and suggestions online regarding the progress of its lean programme.

This is a difficult yet exciting time. Threats to business abound but, like it’s always the case in complex situations, there are also opportunities to explore and potential to tap.

All we have to do is be ready to recognise opportunity and act accordingly. Hopefully this issue of the Lean Management Journal will Editorial help you to do just that and prepare you to Commissioning editor – Roberto Priolo approach the future more confidently. r.priolo@sayonemedia.com

Yours,

Consulting editor – Jane Gray j.gray@sayonemedia.com

Design

Art Editor – Martin Mitchell m.mitchell@sayonemedia.com

Designers – Viicky Carlin, Alex Cole

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studio@sayonemedia.com

Roberto Priolo Editor Email: r.priolo@sayonemedia.com Tel: 0207 401 6033

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S E P T E M B E R / O C T O B E R 2 0 1 1 contents

04 Introducing the editors 05 Lean News 06 What’s next

Brenton Harder, of Credit Suisse, introduces this issue of the Lean Management Journal, which focuses on how lean will change in the future as new tools and methodologies are introduced and an increasingly difficult global economic situation presents businesses with new threats.

Process focus 28 Does it have to be a fiasco?

Edyta Oborka of Schneider Electric and Kevin Kibble and Mark Stanford from the School of Technology at the University of Wolverhampton talk about lean manufacturing in standard and engineering-to-order environments.

History and evolution 32 Care for your equipment

Roy Davis of MCP Consulting and Training looks at the origins and current use of Operator Asset Care.

Principles and purpose 07 Who will lead business transformation? 38 LMJ in conference CIOs and CFOs have to work together if they really want their business to achieve change. Author Andrew Spanyi explains the importance of cross-functional collaboration.

This section features reviews of the events LMJ attends. Find out what goes on in the lean community by reading about some of the most interesting conferences and seminars.

42 Letters and comment

13 Beyond 5S

Joseph Ricciardelli, a MSc teacher in Italy and founder of Tecla Consulting, offers an interesting analysis of the new tools available to the lean community.

18 A model factory to help a struggling territory

The Lean Experience Factory in Italy doesn’t only offer an innovative approach to training, but it also represents a means through which an area hit by a productivity crisis can change its future. Andrea Fornasier and Paolo Candotti of manufacturers’ association Unindustria tell us how.

24 Understanding customer value

Daryl Powell, a research associate at the Norwegian University of Science and Technology in Trondheim, discusses the relationship between ERP and lean.

Contributions for this issue come from Jon Alder of Rexam PLC, who shares his thoughts on what mature lean company are doing next; emergn’s Philip Black, who talks about staying focused on the outcome of a programme; Keivan Zokaei, who responds to Chris Daffy’s article on lean failing in the service sector, appeared in LMJ’s February issue; and Dougal Fraser of oee, who shares his interesting point of view on why so many lean professionals in the service sector worldwide are British.

52 Lean diary

In this new column, LMJ observes the lean journey of Serbian company SCGM. Director Sandra Cadjenovic tells us about the experience of this SME as it moves its first steps into the implementation of a bespoke continuous improvement programme.

54 Book review

John Bicheno reviews Lean IT by Steven Bell and Mike Orzen, CRC Press, 2011

Elizabeth House, Block 2, Part 7th Floor, 39 York Road, London, SE1 7NJ T +44 (0)207 401 6033 F + 44 (0)207 202 7488 www.sayonemedia.com.

Lean management journal: ISSN 2040-493X. Copyright © SayOne Media 2011.

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55 Events

Introducing your editors Articles for LMJ are reviewed and audited by our experienced editorial board. They collaborate on comment against articles and guide the coverage of subject matter.

Jacob Austad

LeanTeam, Denmark

Professor Zoe Radnor

Cardiff Business School

Bill Bellows

Ebly Sanchez

John Bicheno

Peter Watkins

Norman Bodek

Wendy Wilson

Brenton Harder

Dr Keivan Zokaei

Pratt & Whitney Rocketdyne

Lean Enterprise Research Centre, Cardiff Business School

PCS Press

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Credit Suisse

Volvo Group

GKN

Warwick Manufacturing Group, University of Warwick

SA Partners

More information on our editorial board, their experience, and views on lean is available on the LMJ website: www.leanmj.com 4

Bosch remembers founder’s 150th birthday September 23 marked the 150th birthday of Robert Bosch. Values such as credibility, reliability, and legality formed the basis of his entrepreneurial action, with “I would rather lose money than trust” being one of his best known sayings. In 1906 he became one of the first employers to introduce

an eight-hour working day. By doing so, he eased the burden on his workers, and at the same time increased productivity by introducing a second shift.

This was an entrepreneurial decision that benefited both the company and the workforce in equal measure. In addition, the

occupational and further training of his associates was an issue of the utmost importance to Mr Bosch. In 1913, he set up his own apprenticeship department with a training workshop. “Employer and employee are equally dependent on the fate of their company,” he wrote in 1920.

Government announces employment law reform In a move heavily criticised by the unions, Nick Clegg said that businesses should be able to have “frank discussions” with underperforming employees or with those workers who are about to reach retirement age without fears that they will be used against them in a court of law. The Deputy Prime Minister announced

dramatic change in employment law, which would include the introduction of “protected conversations”, in a bid to reduce the burden red tape puts on businesses. He said: “We want to give employers the confidence to be open about performance and about retirement with their employees.”

Amey scoops CIPD award after cutting HR costs The public service infrastructure provider won the 2011 Chartered Institute of Personnel and Development (CIPD) People Management Awards.

Amey also won the Building HR capability Award, having shown ingenuity and innovation in the rapid transformation of their HR function to deliver significant business benefit as well as improved employee communication and collaboration. Within

HR, improvements have been delivered alongside a reduction in HR costs of £1.6m per annum. HR has also contributed substantially to savings from organisational restructuring – including a reduction of £15m in overhead employee costs and of £0.7m in temporary labour spend in 2011. Amey is experiencing an extended period of growth from 10,000 employees in 2009 to a predicted 35,000 by 2015.

Second edition of Staying Lean published

If you have any news that you think would interest and benefit the lean community please let us know. Send submissions to the commissioning editor Roberto Priolo: r.priolo@sayonemedia.com

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The first edition of this highly acclaimed publication received a Shingo Research and Professional Publication Prize in 2009. Explaining how to create and sustain a lean business, it followed Cogent Power’s first two Lean Roadmaps along their journey. Since then, however, several members of Cogent Power’s senior management have moved on, steel prices have declined, and the credit crisis has sparked an unstable global economy. Set against these developments, the second edition of this book reports on Cogent Power’s response to these issues-detailing how it worked through its third Lean Roadmap. Based on a model of sustainable change, the text defines by example the elements of successful lean management that are often difficult to emulate as well as the more visible features of process management.

What’s

next

Brenton Harder shares some introductory thoughts for this issue of LMJ and urges readers to consider the essential and necessary elements at the core of any successful quality initiative.

During the early days of manufacturing, quality was inspected into process output, and it wasn’t long before statistical theory was introduced as a new tool to ensure adherence to required production standards. Since then, the regular introduction of new tools and techniques have helped quality professional to continually break down complexity to deliver sustained performance advantage.

It’s been nearly three decades since quality first made its way into everyday business vocabulary and practice through the widespread adoption of TQM. Since that time, new techniques, methodologies, and practices have come in and out of vogue in predictable cycles.

Whatever new acronym comes next in the ongoing evolution of quality, it will most likely share the same four indisputable “truths” found in every successful methodology: externally focussed, results oriented, rigorous, and simple.

We’ve all learned from Womack and Jones that true value is defined by the external customer, and that value is created by the producer. As producers, we need simple ways to continually focus on results through repeatable and rigorous measures to help us improve and smooth process output and eliminate waste. That’s where quality tools and techniques come into play, and as the needs of our customers change, our quality tools and techniques need to change with them.

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If you’re looking for what’s next, there’s no need to look any further than this edition of the Lean Management Journal. This issue highlights several new ways to continually evolve our ability to deliver true value and introduces new tools such as value stream costing and matrix of probability, as well as exploring new forms of training. Of certain interest will be the comparison between classroom training effectiveness versus online delivery.

As a disclaimer, it is important that we continually look for and develop new tools and techniques to better deliver value to our customers, but always with an eye toward execution. Use what works best for your customers and your company, and avoid the common pitfall of continually tailoring methodologies or tools with little incremental value. E N D

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W h o will l e ad busi n e ss t ra n s f o rmat i o n ? A ndrew S panyi

Who will lead business transformation?

T

P rinciples and

purp o se

Chief financial officers (CFO) and chief information officers (CIO) are particularly well placed to play a central role in business transformation, when they collaborate. Yet, the track record on such transformations is disappointing. This is in spite of the fact that most CFOs have a vested role in strategic planning

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Author Andrew Spanyi has written three books on the importance of cross functional collaboration and a customer-oriented process focus. In this article, he tells us why CIOs and CFOs should work together if they want their company to achieve operational excellence in the current economic situation.

here is a crisis in Europe and America. It’s partly related to the financial meltdown of 2008.

But there’s much more to it. There are protests in the streets in the US and Europe, against the failure of governments to address fundamental economic issues. Increasingly volatile stock markets and the rapid pace of international competition have combined to create uncertainty and even fear. A few thoughtful executives recognise that a transformational effort is needed to survive and prosper. Not downsizing or rightsizing. Not just a series of kaizen events. And certainly not simply technology-enabled change through the deployment of packaged solutions.

Instead, business transformation involves a fundamental rethinking and reshaping of business operations where senior management leads a cultural change involving a clear and enduring focus on creating value for customers via the definition, improvement and management of the organisation’s endto-end business processes. Such business transformations must be led by the chief executive officer (CEO), yet much of the heavy lifting often falls on the shoulders of the other members of the senior leadership team.

and determine what the organisation measures and monitors and CIOs operate and improve the information systems that are central to success in most modern organisations. CFOs and CIOs are natural partners. Not only is it difficult to imagine a successful transformation today that does not rely heavily on enabling information technology, but the CFO and CIO often have to contend with others seeing them as simply technical experts, and they both need to make sense out of increasing complexity.

What are the fundamental values and beliefs that the leaders of transformational change need to embrace to succeed with such an initiative?

What are some of the key obstacles that CFOs and CIOs need to be overcome in playing a central role? What are some of the best, albeit rare, practices for a CFO and a CIO to take in their central role in transformational change? These are just some of the key questions that this article addresses.

Basic Beliefs

Sweeping changes need to be built on a solid foundation. There are at least three fundamental beliefs that the leaders of business transformation need to embrace.

The first of these is that the performance of shareholders is best served when an organisation performs to fully satisfy the needs of its customers. This requires that the leadership team view the business from the “outside-in”; that is, from the customer’s perspective. Customers don’t care about how a firm is organised. They only care about what the company provides to them: value for money, on-time order delivery, quality, and responsiveness.

The second fundamental belief is that organisations are complex social systems, and that outstanding performance requires collaboration across traditional departmental boundaries. A systemic view is as important, and perhaps even more important, than a systematic approach. Transformation invariably requires an approach that marries radical innovation and the discipline of continuous, incremental improvement, and in most organisations that requires an unprecedented collaboration across traditional departmental lines.

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The third basic belief that is fundamental to transformation is that strategy is best executed through the improvement of business processes. The corollary to this is that customer requirements should be a driver of strategy and that a process view creates insights on the best form of organisation design and the related alignment of recognition and reward systems.

These beliefs are essential to success. They are in stark contrast with the all too common traditional management view that “we’re smarter than our customers” and “our over-riding responsibility is to produce near term shareholder returns”. Such traditional beliefs stand in the way of customer centricity, adaptability, and agility. Embracing them is necessary to overcome some of the major obstacles that CFOs and CIOs who have the passion for playing a central role in transformation often face.

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W h o will l e ad busi n e ss t ra n s f o rmat i o n ? A ndrew S panyi

In order to overcome these obstacles, CFOs and CIOs need to earn respect and establish credibility outside their traditional role by taking action in at least these areas: Measure what matters to customers.

Promote an enterprise view.

Forge essential partnerships.

P rinciples and

Measuring what matters to customers is the foundational tactic to mitigate the obstacles of perception and complexity. It enables the CFO to raise questions around operational performance. By emphasising metrics such as perfect order delivery (on-time, complete, error-free), perfect response to inquiries and complaints (first time right, complete, error free) and variance to promise date for new product or service introduction, the CFO can raise thought provoking questions that strike directly to operational performance and where the resolution of problems demand cross-departmental collaboration. When customers receive perfect orders and first time right responses to inquiries – they not only pay invoices faster (a good thing to keep DSO on target) – but this also serves to increase customer loyalty and build revenues. The addition of these metrics to the leadership team’s scorecard can serve to offset the unbalance of focusing solely on financial measures of performance and the ensuing discussion can counter the perception of the traditional CFO role, building the CFO’s credibility and business acumen. The CIO needs to be a partner is measuring what matters to customers and needs to find ways

purp o se

The obstacle of “complexity” arises due to the combination of an increasingly complex and onerous regulatory environment and the increasing proliferation of both information technology and improvement methods. It is not uncommon to have multiple disparate systems - running not just financial but also customer touching applications - creating silos of relevant data. Corporate consolidations also produce increasing levels of complexity as new processes, systems and data sources multiply. Similarly, the proliferation and codification of various improvement methods such as lean, six sigma, lean six sigma, technology based reengineering, etc. often result in multiple uncoordinated

initiatives operating within the firm.

Organisations also need to cope with standardising financial procedures and ensuring compliance within a restrictive regulatory environment due to standards such as Sarbanes-Oxley (Sarbox) and International Financial Reporting Standards (IFRS).

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Overcoming Obstacles

CFOs and CIOs need to overcome difficulties in two main areas: perception and complexity. The obstacle of “perception” arises when members of the leadership team view the role of the CFO in a traditional context as the chief counter of beans and the head number cruncher and the CIO as the chief nerd and the head techie. Sometimes this view is merited, especially when the CFO emphasises “making the numbers” above creating value for customers. Similarly, it is merited when the CIO uses a vocabulary that is packed with three letter acronyms and terms such as “mashups”, etc. that may be well defined in the world of IT but have little meaning to many business executives, and talks about agility - and yet when the business needs IT support, the response from IT may take months and even years.

to automate data capture even though many packaged ERP systems don’t do it.

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Measuring what matters to customers sets the stage for taking an enterprise view of the organisation. The transformation minded CFO and CIO can collaborate on the development of a schematic of the enterprise, accompanied by a story of what the firm wishes to accomplish, taking into account performance for customers, the key business processes and the technology that enables performance.

Here, it’s important to ask - not tell. This means asking questions around the current and desired level of performance to create customer value that provoke thought and move the leadership team towards a shared understanding of the scope of the organisational challenge and the need for collaboration. Transformation is a team sport, and most leadership teams simply don’t practice. That is, they don’t discuss how different departments need to work together for value creation in any regular and disciplined way. They don’t work diligently on reducing jargon and assuring clear communication on major issues. When the CFO and CIO take the initiative to collaborate and become catalysts for such an enterprise view, it builds their credibility and can also serve to define and maybe even reduce complexity.

Forging essential partnerships is also key to mitigate obstacles.

Establishing a close and collaborative relationship with the chief executive officer is arguably the most important of these partnerships and fundamental to success.

Successful transformations may be planned by the CFO and the CIO, but invariably these are led by the CEO in communicating the case for change and deciding which members of the leadership team have what it takes to succeed. While the partnership with the CEO is necessary, it may not be sufficient.

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Partnerships with key members of the leadership team, the senior human resources (HR) executive and like-minded line of business executives are also crucial. A strong alliance with the senior HR executive is needed as the enterprise is a multifaceted social system.

Transformational efforts must first be led, but then the change programme needs to be managed and this is where the alliance with the senior HR executive can pay dividends. This collaboration is important in developing the best organisation design and the related alignment of recognition and reward systems, and as many transformations require new talent at the leadership team level, this alliance, in concert with the CEO, is critical in making needed personnel changes. Strong relationships with line of business executives are equally essential as much of the change will occur in these areas.

W h o will l e ad busi n e ss t ra n s f o rmat i o n ? A ndrew S panyi

Once action is taken on measuring what matters to customers, forging partnerships, and encouraging an enterprise view of performance, the stage is set to engage in the best - albeit rare - practices needed for success in transformational change.

Rare Practices

P rinciples and

At the end of this discussion, the SLT agreed that prompt action was needed on at least three critical business processes: New application processing (from quote to policy in force).

Customer inquiry (from inquiry/ complaint to resolution).

New product introduction (from idea to commercialisation).

purp o se

The Regional Insurance Company (RIC) had enjoyed a long period of growth. Yet, Leslie, the CFO at RIC, was concerned about the gradual flattening of the business’ revenues and profits. Nearly two decades ago, RIC started out as a small regional niche player in the automobile insurance sector and over the years had become a mid-sized player, expanding its served market and adding services for motorcycles, RVs, and marine insurance. Due to their history of success, senior management at RIC had become comfortable, perhaps even complacent, in their departmental roles. Leslie felt that what was needed was nothing less than a transformation on how RIC conducted business. But, where was the burning platform? Since she was a customer too, she knew that customer demanded (and deserved to receive): On time, complete, and error free processing of new applications.

Prompt, first time right responses to inquiries and complaints.

Reliable service (i.e. rapid and error free claims processing).

As RIC’s systems were not designed to capture any of these three important and customer facing metrics, Leslie met with the director of IT and they resolved to work together. They tasked a financial analyst and a business analyst to work together and collect representative, random samples for each. The data indicated that there was ample room for improvement in each area. Leslie discussed the results with the CEO. They resolved to launch a major transformation to accelerate profitable growth by emphasising the quality of service to customers. Leslie presented the data on the three selected customer facing metrics to the senior leadership team (SLT) at the next weekly operating review meeting within the context of an enterprise view schematic (Figure 1).

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There are a number of best and rare practices that transformational CFOs perform. These include, but are not limited to, crafting a compelling case for change, assuring early or quick wins, emphasising pacing, and taking steps to institutionalise change.

Sequence does matter, as the following example illustrates.

Figure 1

RIC Enterprise Process Model Sales & Mktg

Legal & Compliance

Claims

Operations

Human Resources

IT & Finance

New Applications Agents

New Products

Insureds

Product / Actuarial

Claims Processing Inquiry/Problem Resolution Claimants

The CEO then challenged everyone in the room to make a personal commitment to improving performance for customers and achieving a new, and aggressive revenue and profit forecast.

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Leslie and the director of IT next met with the CEO and the vice president of human resources to develop the company wide communication plan for the transformation based on the tag line of Operational Excellence (OE) and the dual platforms of a return to growth and total customer service.

They intuitively understood that while the top line and bottom line were important to the SLT, it was equally important to engage the entire organisation by calling upon people’s pride in their work and linking it to customer satisfaction. It was this combination of messages that created a compelling case for change.

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The OE programme was launched with fanfare. Concurrently, a major process reengineering effort was initiated on the three top priority business processes and the teams were tasked with rapidly identifying quick wins for early implementation. Each team uncovered outdated policy issues and other easy to implement fixes that were used to demonstrate progress and folded into the communication plan to maintain excitement and momentum.

Visible operational improvement was evident within six months into the OE programme. E N D

Further reading

Andrew Spanyi’s books are More for Less: The Power of Process Management, Business Process Management is a Team Sport: Play It to Win! and Operational Leadership.

To contact him please visit: www.spanyi.com or write to: andrew@spanyi.com

B e y o n d 5 S J oseph R icciardelli

Beyond 5S T

oday not only Toyota, but most large corporations deploy a continuous improvement programme, which is very often based on lean management, TPM or World Class Manufacturing logics.

The applied methodologies are different and structured according to the specific needs of the company. All of them aim to uniform the approaches to continuous improvement in the several divisions and plants inside the specific companies.

New additions to the lean toolset promise to bring substantial benefits to companies that are willing to embrace a continuous improvement programme and to concentrate on that single, great idea the founder developed to begin with. Joseph Ricciardelli, founder of Tecla Consulting and professor at a master Italy’s CUOA Foundation organises for entrepreneurs interested in implementing lean within their businesses, discusses the new lean tools available to practitioners.

Very often, programmes go out of the company borders to have an impact on suppliers, which, even when they are already implementing a continuous improvement programme, occasionally have to integrate their activities with the requirements of their customer company.

The risk of getting confused

The real secret of Toyota is that the two pillars on which its system is built on were the actual basic principles upon which the founders and developers of the company have based their own way of running the

P rinciples and

Considering the enormous offer in terms of methodologies, consulting services and applied models to which we can refer, there is a very high risk of getting confused and not having a clue as to what to do, from the very beginning of the implementation of our improvement programme.

purp o se

Last but not the least, there are a lot of small and medium-sized companies that are feeling the need to introduce a lean management system, but don’t know which models suit their requirements best. These companies usually find themselves facing a dauntingly rich and overwhelming consulting offer in terms of tools and solutions available to them.

What are the new lean tools that a small and medium-sized enterprise can deploy quickly and effectively within the implementation of a continuous improvement programme?

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On the other side, a supplier that has not implemented a lean programme yet could feel forced to use a methodology it doesn’t believe in.

business. Sakichi Toyoda noticed his mother had trouble with her loom that was not achieving “first time quality”. Wanting to spare her the frustration, he invented and patented the auto-blocking loom, that would stop as soon as a thread broke. Today we call this Jidoka, and there is plenty of literature on it.

While visiting the United States, Kiichiro Toyoda, Sakichi’s son, was much more impressed by American supermarkets and their Just in Time philosophy than by what he had seen on the Ford Motor Company assembly lines.

Just in Time and Jidoka are the two pillars of the Toyota Production System, which isn’t just the very first, but also the most studied, copied and pasted continuous improvement system in the world.

Thinking about your own company, are you able to recognise the “founder’s spirit” in all the activities you are carrying out? Are you able to feel the power of the intimate values of your company, and transfer them into your system improvement strategy and activities? You have to go back to your origins.

Any founder of an enterprise had a typical mindset and approach guiding him to success.

To explain this concept in the best way, we can use Llorente’s success triangle scheme: on the top of the triangle there is one, great idea, on which our entrepreneur is focused and dedicated; in the middle, there is ‘smell’, which he was able to find the right answer with; at the bottom, there is courage, which he needed to guarantee the success of the enterprise.

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According to the same concept, too many ideas, even the same smell, but little courage are a recipe for failure.

This representation may be a bit colourful, but it is very useful to explain the concept in a few words. The success triangle scheme is applicable, of course, also to new entrepreneurs who are just starting their businesses.

How do we use the success triangle scheme when we are talking about an organisation

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B e y o n d 5 S J oseph R icciardelli

However, for the smartest improvement programmes, the equation results=more profit is valid. Isn’t profit the main target of any entrepreneur?

Theory of the triangle One idea

Enough smell

A lot of courage

People Involvement

The question is: does reducing losses also mean increasing profit? Well, it depends.

It depends on the structure you give to your improvement system and whether you are really considering the full cost of implementing it in your organisation.

This is even more true for small and medium-sized companies facing the need of introducing an improvement programme.

For them implementing without considering the associated costs can be very dangerous. Larger organizations can allocate specific resources to improvement activities. Being this a part of their “standard job”, they are used to have, even in their organisational chart, positions like value stream manager, continuous improvement engineer, or lean manager.

They are all creating their own improvement systems with space, people, time and money entirely dedicated to reducing losses. The biggest mistake a small or medium-sized company can make is to replicate the approach of a large corporation: it doesn’t have the same structure or investment possibilities larger players can count on.

The war against losses has to start with the appropriate investment (the one that is giving us a return on investment of 2 or 3 in one year?), the one that is right for our company. Thus, to introduce lean in our company, our first target is to define the best area to start working on, the one from which we can have the best results. In these first steps, we have plenty of tools to map

P rinciples and

Method

Let’s start from the top: results. As stated above, results need to mean profit. Every improvement system is usually focused on waste reduction.

purp o se

Results

Starting from here, let’s apply these concepts to our situation, be it the early steps leading to lean implementation or a check of the programme’s actual status, compared with the new scheme of the success triangle.

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and its lean programme? If you want your improvement programme to be successful, where there is courage you will need people involvement; instead of smell, you will need method; and that single idea at the top represents the results, which usually translate into waste reduction.

the process and discover the “pilot area�. A lot of them take a few days of analysis, but very often several weeks.

This is the time to introduce a tool called Profitability Matrix, which gives us the possibility to perform a quick qualitative evaluation of the first areas where our lean programme should be introduced. It requires one day of work, and five to six top managers.

The idea behind this tool is to take the complete value flow of our organisation and identify the areas in which we have the biggest opportunities to be profitable. The job is very qualitative, but the more the Profitability Matrix is applied the more its results are akin to the feeling of the company’s leader.

Every time we start an activity in a pilot area we have two options: first, we define the area as a pilot on the basis of the CEO feelings; second, we define it on the basis of the work of a steering committee that has used an objective tool like the Profitability Matrix. The second option is much better, especially because the pilot area is defined by the managers who work together, with the same approach and using the same language.

The steps to build the Profitability Matrix are: 1. Define the functional areas of your company, from the generation of the idea, through the transformation process, to cash income.

2. List all the profit factors.

3. Give a value (high, medium, low) to the outcomes achieved from the meeting of each functional area with each profit factor.

4. Create a Pareto of the Critical Functional Areas and one of the Critical Profit factors.

5. Decide where to start from with your pilot activities.

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The first thing you do in the pilot area is mapping the flow, by using a common Value Stream Map. Then you can identify waste and start kaizen activities against it. To

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B e y o n d 5 S J oseph R icciardelli

In the last few years many companies, especially corporations, have developed their own continuous improvement programmes. Together with the standard tools, some companies are developing and using new ones.

This proliferation is particularly present in safety, workplace organisation and logistics.

Here is a list of continuous improvement tools developed in recent years: Safety Cost Deployment Environment Cost Deployment Logistics Cost Deployment Muri-Mura-Muda Analysis 3x3x3 Matrix Quick-StandardMajor Kaizen

manage this entire process, some companies are experimenting and developing a new tool, Value Stream Costing. This name is used in literature to refer to several different tools. However, here we use it to identify a step-by-step activity that is combining the Value Stream Mapping and Cost Deployment approaches.

The steps to build Value Stream Costing, on a selected pilot area, are: 1. Process and losses mapping, using “loss-where matrix”.

2. Causal losses costification, using “C-Matrix”.

3. Define the priorities of intervention.

4. Improvement project start-up and monitoring.

5. Benefit/Cost analysis for each improvement project.

Going back to the success triangle, using these tools and this kind of approach in a small and medium enterprise we can carry out all the activities necessary to maintain our focus on results.

With regards to the method, we should remember that there is a plethora of tools that are used and sometimes overused. The most important thing is to never forget that in order to be useful a tool has to follow the basic principle of the Scientific Method of Descartes and Bacon, of which PDCA itself is nothing but an interpretation.

But what about involvement, the base of our triangle?

People involvement is always considered necessary in all improvement programmes. The question all top managers and improvement project team leaders usually ask themselves is: how can I get people involved and use their best potential? From the experience of SMEs, there are two main tips to add to all the major activities you can put in place in your company, like rewarding programmes, coaching and leadership training and motivational activities of many kinds.

P rinciples and

The second one is: put a tomato on the Toyota brand!

Tell your people that the improvement programme they are part of is not the Toyota Way or another “common” lean programme your customers or your competitors are deploying. Tell them it’s the Tomato Way, with the name of your company replacing the tomato. Brand yourself. Brand your continuous improvement programme. E N D

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The first one is: never forget to speak when you have the support of data. Being objective is the best way never to lose involvement.

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New tools

A model factory to help a struggling territory Andrea Fornasier and Paolo Candotti, of manufacturers’ association Unindustria, tell LMJ about the Lean Experience Factory in Pordenone, Italy. This new facility doesn’t only represent an unusual form of training, but is also expected to provide some relief to a territory that is suffering from a productivity crisis.

By introducing lean thinking in the area, this factory/school might just be able to support academic knowledge and entrepreneurial expertise as they try to develop those capabilities that are required to remain competitive.

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n 2009, the manufacturers’ association of Pordenone Province, in Northeast Italy, carried out a research called “Beyond the crisis - Pordenone towards 2019”, designed to find out what the main opportunities were for the growth of the area and its entrepreneurial environment.

The study aimed to detect the various manufacturing features of the area, identifying its strenghts and weaknesses. At the same time, many scenarios and competitive trends were analysed in their significant effect on the territory.

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Starting with these assumptions and the information gathered through the involvement of some 70 players in the Pordenone province in interviews, workshops, focus groups and specific sector studies, five major areas of action to support growth in the territory and to re-launch the local manufacturing sector were identified, namely: Productive Efficiency Internationalisation Innovation Facilities and Infrastructures Financing Tools Pordenone belongs to the so-called Club dei 15, the network of the Confindustria (the national industrialists’ group) associations representing the provinces in Italy in which manufacturing has the highest incidence on per-capita gross domestic product. In order to be part of the Club dei 15 the following parameters are to be matched: high income (€20,000 per capita); manufacturing

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A m o d e l fac to ry Andrea Fornasier and Paolo Candotti

contribution (including building) to added value higher that 35%; industrial employment rate higher than 40%.

Pordenone is indeed a province with a strong manufacturing vocation.

Nevertheless, after a more in-depth analysis of the added value per operator in the manufacturing sector, it emerged that this figure (€46,900) is considerably lower here than it is in other areas in Italy with similar levels of manufacturing specialisation (for instance, Bergamo has €55,500, and Vicenza has €49.400).

It became evident that a productivity gap existed in Pordenone, if compared to the other provinces belonging to the Club dei 15.

It is likely that the good economic conditions prior to the dowturn had hidden this crisis of productivity from view.

Lean to regain competitiveness In such a scenario, the top priority was to give a boost to the industrial productivity of local enterprises: the lean approach was soon identified as an opportunity.

Other projects to recover competitiveness in the Pordenone Province Some additional, complementary projects are being implemented, with the aim to spread lean culture and support the use of lean techniques in the area. Here are some of them: The Pordenone Chamber of Commerce calls for the adoption of lean techniques systematically (by using vouchers for training or consultancy to achieve high efficiency); Public funds are being used to promote specific training to reintegrate workers made redundant into the local economy; A calendar of training courses specifically designed for high school students was created; A number of projects focusing on specific production sectors, with their specific characteristics and criticalities.

Studies and research showed the tremendous impact this methodology can have on productivity, with improvement ranging from at least 10-15% to peaks of over 50%, and other positive effects it has also in terms of increased product quality and overall plant efficiency.

Such an effect (and the consequent increase in competitiveness in the area) would turn out to be a natural deterrent to outsourcing on one side, and a way to support growth, employment and purchasing power at a local level on the other.

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The third solution turned out to be the most suitable for Pordenone and its situation, as it ensures the best chance to create skills that it will be possible to keep in the long term.

P rinciples and

Three possible ways to develop a local lean culture were identified: investment to support already existing training centres; support to consulting services for enterprises; specific funding for the development of knowledge and skills, together with a structured training and learning system to instill and spread them, through the creation of a model factory where people can “learn by doing”.

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In particular, lean offers the opportunity to achieve long-term results, as demonstrated by many case studies in several industrial sectors.

Besides, once this approach settles in, it can guarantee an integration and constant fruitful exchange with the cultural and managerial environments and local technology, ensuring a synergetic and effective impact on Pordenone’s economy and a more appealing image for its territory.

An in-depth research into methodologies has demonstrated that training in a real production environment is more effective than theoretical lessons or simulations.

According to an ad-hoc analysis of effectiveness, carried out three months after the learning-by-doing approach in a real production environment was experienced, this method was proved to be six times more beneficial than a theoretical one. This is how lean techniques are learned, by actually doing.

The Lean Experience Factory

The “model factory” was created with the name of Lean Experience Factory. LEF aims to put together institutions on a regional scale (Unindustria Pordenone and other local partners such as Confindustria Udine, Pordenone Chamber of Commerce, Pordenone Province, Polo Tecnologico di Pordenone and Keymec) with the expertise and international know-how provided by McKinsey&Company, that already boasts a network of model factories in Europe.

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However, as the only McKinsey model factory not developed merely inside a university, the Lean Experience Factory is much closer to companies’ needs, as a result of its having been conceived by Unindustria Pordenone. It is meant as a tool for supporting the competitiveness of enterprises both at a local and national level.

The scientific partners of this initiative are the University of Udine, the University of Trieste and Vicenza’s CUOA Foundation.

The Lean Experience Factory represents an innovative form of training used to learn all about lean techniques. It is characterised by a peculiar training

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method, based on direct experience and onthe-field testing carried out in a real and controlled environment (the model factory). Its nature makes it an ideal environment to transfer know-how and teach wastereducing lean techniques.

LEF has a workshop where a real production process takes place (head units of compressors for household appliances are assembled in this line) and classrooms for theoretical training where lean principles are taught by qualified staff assisted by dedicated operators.

As a structure, LEF is organised in a 300-square-metre shopfloor area (with a raised viewpoint platform), equipped with production machinery and tools, and separate training rooms. In particular, the shopfloor provides a production area equipped with saw cutter, die cutter, milling and washing machines; an assembly area (with four stations); a testing area (with two stations); and a components and finished products warehouse.

Many training tools are available on the shopfloor to further support teaching activities. The factory can have different configurations, from the initial one arranged according to the functions performed to the final, lean one. During the training course, the factory changes from a non-lean environment into a lean one, with the aim of letting people on the training understand, through experience, all the implications of a change in lay-out and the improvement in operational performance that can be achieved in the plant.

The Lean Experience Factory provides three different courses: Lean Awareness (a oneday session), Lean Week (a five-day session)

A m o d e l fac to ry Andrea Fornasier and Paolo Candotti

and Lean Expert (which lasts 22 days) based on classes and direct shopfloor experience. Such courses have been designed to meet not only managerial and entrepreneurial requirements but also those of the operators in charge of facilities and change.

LEF has staff on call (about 10 teachers), properly trained for teaching on the shopfloor, one Ph.D. student who, besides carrying out research activities, supports teachers during practical lessons in the factory, and four shopfloor operators (who in most cases are university students).

Beyond training

The Lean Experience Factory represents a long term investment with significant positive effects in terms of local development and growth. Its mission, in addition to promoting studies and research on lean thinking and lean techniques, is to give a real contribution to a productivity increase in the area, by means of scientific, ad hoc training and education provided to a significant number of entrepreneurs, managers, employees and students.

Its goal is to foster a profitable exchange between universities and research bodies on one side and industrialists and entrepreneurs on the other, as an ideal way of enabling a concrete application of lean methodologies by an increasingly efficient, productive type of management. It can work as a bridge between local entrepreneurs and it can indeed reduce the current gap between what the academic world offers to companies and what companies actually need.

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P rinciples and

With all of this in mind, the result that the Lean Experience Factory hopes to achieve is to change the territory through the development of a lean environment that involves all the crucial players. It may be an independent body, but its goal is to nurture and lead a “lean movement� which will involve all those striving to fill the productivity gap the Pordenone Province is experiencing. E N D

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Besides, LEF is an ideal tool for a thorough circulation of lean culture in the territory, thanks to its capability to provide different, customised services to all types of local entities. It can create training opportunities for different professional figures within an enterprise, from managers to employees. There is an opportunity for the local public administration to be involved as well, with training offered to its employees, and a chance to achieve higher efficiency.

Students from universities and high schools can be taught, too: they are the future players for change and those who will be able to apply lean methodologies and techniques in production processes. Finally, the model factory can play a big role in challenging the local offer of consulting services and making it more lean-oriented in response to an increased demand.

The use of standard operations and visual management is widespread across business, but used to varying effect. Ian Tindle, director at specialist efficiency improvement company Sora Group, highlights how they are helping companies employ more creative ways to enhance their lean programmes.

Is training a necessary evil?

solution is updated annually as vehicle or equipment changes are made. This type of project needs a sign off process confirming the training and the issue of a DVD.

At Sora, we’ve taken on board the advice of our expert partners Scenegroup, and have focused on using video and animation content to help embed lean principles. “We’ve all heard the expression ‘a picture paints a thousand words’.

Well, next generation thinking shows that a minute of video is worth 1.8 million words,” said Dr. James McQuivey of Forrester Research.

Bacardi - Mixology Techniques It was designed because the audience in this case would not be likely to engage with traditional training methods. Used to bring high end venue bartenders up to speed with a range of important drinks serving techniques. It was very successful thanks to styling, messages and selected presenters.

We all know that we need to train our people, but time and resource are often limiting factors. In lean terms, the customer has to come first - and this often means that a focus on training, development and continuous improvement becomes difficult to maintain when day to day problems arise.

People are more inclined to watch a video to learn things rather than reading through information. When you make it easy for them to learn, retaining information is easier.

Delivering a message

Consider the following examples of solutions to training and development needs.

Spirit Pub Company - Guest at the Heart This solution was developed to deliver a consistent training message to 18,000 staff from 900 venues across the UK, generating a huge cost saving in staff time and trainer costs, as delivered at staff locations without the need for trainers to facilitate.

Costa Coffee - Perfect Serve It was designed to ensure complete serve consistency across all venues. Processes are simple, but must be delivered in exactly the same way by every staff member.

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Ambulance Service - Crew Vehicle Training Devised to support live training sessions and generate a revision tool for every crew member to keep, this training For online examples to highlight the creative and innovative use of standard operations, please visit: www.sora-academy-player.co.uk or email: info@sora-group.co.uk.

Follow Sora Group on twitter @soragroup.

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Do we need to forget traditional methods?

Not at all, but we do need to consider how we move with the times and use technology to our advantage. A key element of lean is that we engage with people and gain buy-in, but we also need to be mindful that we ensure that we achieve the best with what we have. If we can maximise the use of our training and development resource, this will hopefully allow a much greater chance of lean success. This may sound like a bold step for some organisations, but certainly one worth considering. E N D

or

LMJ’s Roberto Priolo goes back to the classroom to attend an introductory course to lean, and then goes online to take the same course in its web version. Here he shares his thoughts on both and how they compare.

W

e live in a world where we can buy our groceries online, where we can communicate live with cousins in New Zealand and buy plane tickets in just a few clicks.

Smartphones have added momentum to this increasingly frantic quest for easily accessible information.

It is worth considering that some trainees - taking their first steps with lean - might feel more comfortable dealing with a screen than a lecturer and a bunch of strangers looking on as they struggle to give the right answer to a question that everybody else seems to find extremely easy. But this isn’t why you should opt for an online training. The convenience and effectiveness are the really compelling factors.

Online training delivery is unlikely to gain a monopoly on lean teaching but it will certainly grow and companies should consider it either as a means of imparting foundation understanding or for compounding lessons learnt in the physical world. E N D

P rinciples and

I wasn’t really sure there was anything the online training could do to make up for the absence of a trainer helping you to

Of course nothing can beat the excitement of being nominated a forklift for the group during the simulation of a production process we took part in as a class, but as I sat in front of my computer a few weeks later I found myself engaged and reacting very well to the web course, getting angry when my answers were wrong and giving extensive thought to the problems I was presented with. It might not have all the benefits of the human interaction associated with an actual class, but training online is cost-reducing (no travel or time away from work), fast and ultimately very effective.

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There is, without a doubt, a great amount of convenience in having 24/7 access to information and services online, and it was only a matter of time before this type of customer-centric approach (which is very lean itself) gained popularity in fields that are normally considered much more hands on and in which the physical presence of people is normally necessary.

Take training, for example. Can the online version of an introductory course to lean be as effective as a one-day training on the same subject, held in a classroom with other eager attendees? To find out, I attended the physical course and took the virtual one a couple of weeks later. Both were developed by training specialist oee.

The platform is user-friendly, using engaging animations and a smart lay-out to keep the trainee focused. The web course also has the distinct advantage of not requiring travel and is easy to follow, very well-structured in terms of the balance between teaching concepts and assessing the trainee’s understanding of them.

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Physical virtual?

understand issues and fellow attendees contributing with feedback, but I have to say I was surprised by the online oee course. Its level of interactivity makes for a very “human” experience.

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n recent manufacturing improvement surveys, lean production and enterprise resource planning (ERP) systems have consistently been rated as the two most important strategies being utilised by manufacturers attempting to compete for sales and profits in global markets.

Understanding customer value Daryl Powell is a research associate and PhD candidate at the Department of Production and Quality Engineering at the Norwegian University of Science and Technology in Trondheim, and also works for SINTEF Technology and Society. He is currently researching the use of ERP systems in lean production, with particular relevance to manufacturing planning and control. Here he discusses the relationship between ERP and lean.

Lean production, which is often described as a journey of waste reduction, has led to substantial performance improvements across many industries and is widely implemented today. Although the development of advanced information technology (IT) support for manufacturing (such as ERP systems) has also led to improvements in production effectiveness, in lean thinking technology has often been viewed as part of the non-value adding activity to be eliminated, rather than as a tool to help achieve and sustain positive change. However, it is no longer possible to exclude technology from the lean approach. But how can ERP systems support the customer value aspect of lean production?

ERP systems provide transaction processing and a common database to model operations within a manufacturing firm, and support several levels of decision making. They are widely used by large corporations around the world and have evolved from a technique used to plan dependant demand materials, known as Materials Requirement Planning (MRP), via a coherent set of best practices for the planning and control of resources, known as Manufacturing Resources Planning (MRP II). The root of all three of these concepts is a product’s bill of material (BOM).

The Lean-ERP Paradox

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The suggested benefits of lean and ERP systems are fundamentally identical and include reduced cost, reduced inventory, and increased productivity.

However, in the traditional sense, both concepts are almost contradictory in nature, hence the Lean-ERP Paradox.

Though in the traditional sense it has been claimed that the two approaches are contradictory, there does appear to be a synergistic impact to be gained as a result of combining and synchronising these concepts. This is because of the increased processing speed, capacity, and visibility of contemporary ERP

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U n d e rsta n di n g c usto m e r valu e Daryl Powell

Table 1:

The Lean-ERP Paradox

(Powell and Strandhagen, 2011) Lean

ERP

Production based on consumption (Pull)

Production based on forecasts and machine utilisation (Push)

Decentralised control & empowerment (Bottom-up approach)

Centralised planning and control (Topdown approach)

Rate-based, mixed model production

Time-phased, batch production

Focus on maintaining flow

Focus on tracking material movements

ERP systems in lean production: Understanding customer value

P rinciples and

Lean production implies a relentless pursuit of waste reduction throughout the

Central to defining and achieving customer value within an ERP infrastructure is the concept of customer relationship management (CRM). CRM is not a new concept but it has recently become more practical due to advances in enterprise software technology. CRM technology applications link front office (for example sales, marketing and customer service) and back office (for example financial, operations, logistics and human resources) functions with the company’s customer “touch points” (see Figure 1). CRM applications help organisations assess customer loyalty and profitability on measures such as repeat purchases and longevity, and help answer such questions as “What products are important to our customers?”, “How should we communicate with our customers?” and “What are my customer’s favourite colours or size?”

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It has been suggested that most lean practitioners have failed to properly understand and apply the first and most important lean tenet - to truly and deeply understand what customers value, and will value. It is not surprising to find that understanding customer value is the very first lean principle, when it is accepted that the core purpose of lean thinking is to enable sustained, profitable growth.

By selecting a forward looking long-term strategic view of customer value rather than a backward looking short-term tactical view on customer satisfaction, manufacturers can better understand the requirements for customer value creation.

In a mass production, product-focused approach, an organisation attempts to find customers for its products by using mass marketing efforts. On the other hand, with lean production, a customer centric approach requires products and services to be developed to fit customer requirements.

entire company. In order to identify wastes, lean practitioners often use the terms value added and non-value added. Value added activities are those that a customer is willing to pay for, and are often the activities that change the shape or form of the product in some way. Non-value added activities on the other hand are all of the activities that do not add value, and these are the wastes to be eliminated. In order for us to address ERP systems in terms of “the most important lean tenet”, we must ask the question, “How do ERP systems support the creation of customer value?”

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systems that allow for closer coordination between shopfloor activities and the supply chain, as well as the continuous elimination of waste within lean production.

We consider the concept of customer value in order to further investigate the LeanERP Paradox.

By using relevant data, the ERP system begins to turn customer orders (and forecasts) into proposals for purchase orders and production orders. If this process is carried out as effectively as possible with the right data, the ERP system is an efficient tool that ensures customer value by delivering the right product, of the right quality, in the right quantity, to the right place, at the right time and at the right price (what we will term the 6Rs). This is a definition of customer satisfaction and implies the correct understanding of customer value.

CRM can be used to help shape and define the 6Rs. ERP systems help create re-energised organisations that are in a position to better serve customers and drive greater business value. As the ERP process begins with information from the customer (in the form of product drawings and/or bill of materials), the ERP system is placed at the forefront of the value creating process. This is because it is the accurate description of customer requirements that first triggers the chain of Figure 1:

events that will lead to an eventual delivery.

Therefore the most efficient use of the ERP system demands effective communication with the customer.

Delivery schedule adherence can be significantly improved by increasing the level of visibility within the supply chain.

Therefore, if an ERP system can be used to effectively increase visibility within the supply chain by offering real-time information to aid the decision making process, ERP systems are a true enabler for supporting the creation and realisation of customer value, as accessing and delivering information in real time helps companies to better react to customers’ needs.

An ERP system can also be used to eliminate non-value adding activities.

We suggest that it is more realistic that the ERP system be used to automate the necessary non-value adding activities, such as clerical (data entry) tasks. A primary example of ERP functionality for this is backflushing. Backflushing can be defined as an automatic registration

CRM applications link front and back office functions with the customer

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(Chen and Popovich, 2003)

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U n d e rsta n di n g c usto m e r valu e Daryl Powell

Figure 2:

A Summary of ERP Support for the Creation of Customer Value Customer Relationship Management (CRM) and 6Rs

Automation of necessary non-value adding activities (e.g. backflushing)

ERP Support for the Lean Principle “Customer Value”

Accurate customer information (e.g. product BOM)

Real-time suppy chain visibility

Further reading

Conclusion

By considering the Lean-ERP Paradox in terms of Womack and Jones’ first lean principle, we have identified four key areas by which ERP can be used to support the creation of customer value: customer relationship management; efficient management of customer information (e.g.

BOM); “real-time” visibility across the supply chain; and backflushing.

It is suggested that tomorrow’s extended enterprise systems will comprise of technological changes that affect not only business strategies, but will also shape our fundamental ideas as to how to best serve customers and compete more efficiently, effectively and profitably, with a central emphasis on a clear flow of consistent, real-time information. It is the management of these fundamental ideas that place the ERP systems at the forefront of customer value creation. E N D

P rinciples and

By investigating the functionality of ERP systems in terms of their support for the lean principle “customer value”, this paper has made a contribution to the argument of lean versus ERP, with particular reference to the Lean-ERP paradox. Powell and Strandhagen identify the potential synergy of applying both lean production and ERP systems.

In following this example, Figure 2 illustrates some of the functionality offered by ERP systems in supporting the most important lean tenet.

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Bell, S., Lean Enterprise Systems: Using IT for Continuous Improvement, Hoboken, NJ, Wiley and Sons, 2006.

Bicheno, J. & Holweg, M., The Lean Toolbox, Buckingham, PICSIE Books, 2009.

Goldratt, E. M., Necessary but not Sufficient, Great Barrington, MA, North River Press, 2000.

component parts and sub–assemblies, and it can also be used for cost accounting purposes.

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process of resources in standardized units for a particular order.

It is a technique that can be used in lean (JIT) production environments both for the registration of the withdrawal/use of

Process focus

Does it have to be a

Why do so many lean programmes in organisations characterised by high value and low variety fail? Edyta Oborka, industrial performance specialist at Schneider Electric, and Kevin Kibble and Mark Stanford from the School of Technology at the University of Wolverhampton, look at lean manufacturing in standard and engineering-toorder environments.

T

he current economic climate is challenging to say the least. Pressure on margins and stakeholder demands determine great efforts from companies to stay competitive in the marketplace. The crossbar for business is getting higher, with competition coming from developing economies making companies hungry for lower costs, greater flexibility and excellent quality.

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Undoubted differences in approach Throughout the years, Engineering To Order (ETO) businesses have often grown to feel as a superpower against standard production rivals. This, however, may be the result of years of closed thinking. Nowadays we can see how it is large global manufacturing companies

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that tend to have a high-volume standard product range. These businesses have developed their own efficient production systems which are mindful of costs but still focused on high quality and, at least initially, a limited offer. However, the challenges facing companies offering high-value low variety production, typical of Engineering to Order (ETO) environments, are particularly big when trying to adapt and implement lean techniques to improve business performance.

In a booming economy, opportunities to grow large margins exist, whether for product or solutions, but those days are gone. Sooner or later, business - even ETO business - will be forced to go back to basics, in which the attention is on cost (of production) and savings gained against ‘forecasted’ margin.

The set of requirements (do not confuse them with the level of effort to get there) for successful lean implementation into manufacturing environments stay the same regardless of whether we are considering high volume (standard) or low volume (ETO) production. Operational stability, in demand and volume, and a strong organisational background for improvement change implementation are fundamental, requiring highly motivated people and strong leadership with the Kaizen approach.

Does it have to be a fiasco? process focus

What makes it so hard to make it successful?

People

People are at the centre of any lean change and, especially in an ETO organisation, employee knowledge is a company’s key asset. Throughout the variations and complexity of the product and processes, it gained power over other resources. However, this knowledge is sometimes held by a limited number of employees, which may prove to be the main obstacle getting in the way of a successful lean implementation.

Companies rely on the knowledge and skills that are developed through years of experience.

Transformation towards lean, involving a revolution leading to simplicity and standardisation, can become difficult. Transferring ‘craftsman individual skills’ into an efficient, modern way of manufacturing can be perceived as an attempt on the intellectual property of employees and must therefore be treated as a risk against successful improvement projects.

No matter what the difficulties are, participation of people in the change

process is an absolute must. Sharing knowledge and experience with an open mind is necessary.

There is no fixed successful method of doing it. An approach specific to an organisation must be developed, which depends on the gap in the organisational improvement culture.

ETO lean transformation may involve changing senior leadership methods, for example over selfconfidence in particular

pr o cess f o cus

The change management process presents a challenge. Getting people to buy into and contribute to the change process and possibly alter their attitudes is key. Moving away from ‘expert’ status and into the participant status is vital, as is a determination to change old habits. Regardless of the type of organisation, and level of management, engaging people during change implementation is a key role for business leaders. “Follow me and let’s figure it out together” should be the approach, shared and supported by all levels of management.

Undoubtedly, challenges in ETO on an operational level reflect the same dispute on the operational and middle level management. The biggest challenge for them is that they are the ones who will lead the transformation.

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The Toyota Production System (TPS) was created for mass production needs, but has been tried in ETO environments.

However, success has been limited, and questions still arise about the limits in the application of lean in such environments: are we going too far with lean, and are we missing the point?

methods will need to be confronted if this proves to be a barrier to the delivery of a framework for change.

Process

The implementation of lean in ETO environments has to be approached from a whole business perspective, entire cash conversion cycle. For example, improvement in the performance response in the entire supply chain can guarantee the long term success of the implementation.

Lean focuses on the customer, and defining the value from both the internal and end customers’ perspectives is a key requirement. In ETO environments the ‘upstream’ processes play a fundamental role.

Sequential adoption of a lean programme should primarily include all ‘upstream’ processes prior to manufacturing. Stability (the foundation stone of lean) can allow for radical, high impacting operational change. Organisation stability provides the background for business improvement success. Instability can only guarantee a fiasco.

The comprehensive tools and techniques which the Toyota Production System offers have to be assessed for use according to the change background required in an ETO organisation. Exploring the world of lean tools helps us to discover and appreciate the support and reinforcement between each of them.

Standardisation opens a prospect and baseline for future best improvement activities, providing a full range of opportunities for lean implementation and making value streams easier to specify and see. In ETO organisations, bespoke product evolution can make for a complex product offering which is difficult to be accounted for in the improvement change programme. What is necessary is the separation of product standardisation and process standardisation, the latter offering a solution to business improvement in the ETO organisations.

In lean implementation, as with any other pioneering approach, we should not be afraid of making mistakes or having to refine solutions over time. Continuous improvement comes from making mistakes and learning from them, from learning by doing. Knowledge through mistakes, where a toolkit for lean in an ETO organisation is still in the development stage, is the quickest way. We have to remember that general principles are always applicable, but that complex solutions require more tailoring. Be the master of your business destiny.

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The impossible can become possible

Today’s marketplace requires successful, on-going improvement strategies in organisations. Increased competition and sharp rises in the cost of manufacturing set the pace for the global economy.

Change of market rules from ‘Cost Plus Method’, driven by the cost of making (cost to make + profit = selling price), into ‘Non-Cost Method’,

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Does it have to be a fiasco? process focus

driven by the selling price (selling price – cost to make = profit), enforce a different approach to business management: reducing costs through ‘waste’ elimination.

The last century was all about numbers. Managing business this way these days is no longer as efficient.

Now to compete within the ETO business there needs to be a better management system, and that’s lean.

Lean does not provide a quick hit. It involves a comprehensive business programme of cultural change. A strategy of change is critical in moving the workforce culture from one of apathy and resistance to one of proactive involvement and ownership.

Lean encompasses an assessment of organisational ability to communicate, learn and transform failures into long term successes.

While enforcing a lean approach, to do more with less should be used as an opportunity for the business as a whole. The formation of a lean strategy has to support the spirit of lean management, to promote asking the right question over providing the right answer. E N D

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People development towards lean thinking creates the background for constructive, long term results. Embracing a new way of thinking about the value added can change the fundamentals of business process management.

pr o cess f o cus

The implementation of lean in ETO environments requires an ‘open mind’ approach towards overall business growth. Lean execution in an ETO organisation has a high potential to transform the current, bespoke business approach; however this is a complex, long term, demanding and arduous task. Strategic execution in order to change the way people think is the biggest challenge and may therefore be more important than process transformation.

history and evolution

Care for your equipment

Roy Davis of MCP Consulting and Training looks at the origins and current use of Operator Asset Care. As he explains in this article, the people who are best placed to look after machinery are those who operate it.

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n the 1950s, the Japanese industry, faced with considerable challenges, developed a variant of planned maintenance now known as Total Productive Maintenance. As with planned maintenance, frequent inspections are a fundamental tenet of TPM, with a heavy emphasis on involving equipment operators in the inspection process. Autonomous Maintenance is recognised as one of the main building blocks of Total Productive Maintenance.

Operator Asset Care (OAC) was initially developed from the principles of Autonomous Maintenance and migrated from Japan during the late 1980s.

Since then, a number of different OAC approaches have been developed by individual organisations and industrial companies and this has provided some different interpretations of the original principles and many different implementation approaches, some successful and some not.

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OAC principles

Operator Asset Care is an essential part of the ‘world class’ approach to maximising the

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effectiveness of operational assets and processes within companies. It not only addresses maintenance but all aspects of the operation of manufacturing facilities and at its very heart lies the motivation and enhancement of company personnel.

This tool has a definite role to play in sharing the responsibility for the condition and performance of machinery and equipment and also by improving machinery condition, which will have the effect of considerably reducing the amount of breakdowns and stoppages.

OAC will bring about a change in the traditional attitude of ‘I operate the machinery, you fix it!’ by promoting

care for your equipment History and evolution

the local team and making the maintenance of machinery condition everyone’s responsibility.

It is an approach that enables traditional maintenance practices to change from re-active to proactive by sharing responsibility for machinery condition, performance and maintenance.

It also provides a number of mechanisms whereby breakdowns and stoppages are analysed, the causes investigated and action taken to prevent further problems.

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hist o r y and

This tool should also be viewed as part of a continuous improvement programme. Its approach promotes the gradual development and improvement of company performance and small shopfloor-based improvements. OAC teams focus on their facilities and all aspects of the machinery that they operate or support, their operational processes and their working environment.

ev o luti o n

By using OAC, preventative maintenance schedules can be made more meaningful and effective as a result of the integrated approach of all production and maintenance personnel, the information gathered and measures of performance used. OAC will also ‘free up’ maintenance professionals and allow them the time required to carry out more complex, preventative maintenance tasks and engineering improvements.

It will enable very effective maintenance systems to be developed and operated as an integral part of manufacturing operations.

Some of the basic principles of OAC are listed below: Our manufacturing facilities are very important as they enable the company to earn income and enable us to carry out part of the operations process.

If facilities are not available, or are not operating correctly and consistently then the performance of the company is diminished.

The best people to look after and improve manufacturing facilities are the people who operate and set them up in conjunction with maintenance personnel.

Typically 60% or more of breakdowns, stoppages or quality problems are caused by a lack of basic maintenance such as loose fasteners, poor adjustment and poor lubrication.

Dirty conditions are a major cause of failure - they accelerate wear and deterioration.

Cleaning and ‘localisation’ of routine maintenance tasks through OAC can detect and prevent at least 70% of all causes of breakdowns, stoppages and quality problems.

If OAC is to be successful within any business there is a need to take on board not only the practices and techniques already described but also the philosophy which is the tool’s very essence.

Its core elements are: team working; motivation of people at all levels and participation and encouragement; positive leadership and support; an opportunity for people to acquire and enhance skills and experience, to develop to their full potential; continuous improvement; and recognition of effort and providing incentives.

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Implementation

OAC is not very costly to implement, but it is not easy and should not be perceived as a short term measure. It will not work unless the implementation programme is given the whole hearted backing of the management team in terms of actions, not just words. The commitment of everyone in the business and the subsequent benefits may take years to achieve, but many can be realised from day one of implementation.

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care for your equipment History and evolution

OAC is not a difficult concept to understand and its practices and techniques are all quite straightforward and logical. However, it is the change in attitudes and values accompanying the change in working practices that can be more difficult to grasp and implement.

The most common mistakes companies make while implementing OAC are: Keeping it a separate initiative set up by just one department Letting poor communication or rivalry between operations and maintenance and shift teams get in the way.

Lack of management buy-in.

Lack of planning, as OAC can mean different things to different people, which makes defining the programme a key requirement.

Not introducing a pilot programme first.

Lack of training.

Introducing OAC to the business

The key to the introduction of OAC to any business lies in the effectiveness of communication. The principles, techniques and implications of applying it within the business must be explained to personnel at all levels via a structured communications programme.

It is often necessary to involve some external, ‘independent’ party to provide awareness training, facilitation expertise, advice, skills training and to support the early implementation.

The development and delivery of a communications exercise is well worth the time and effort required to smooth the way of the initial OAC implementation and remove any industrial relations ‘hurdles’ which may otherwise be encountered.

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hist o r y and

It is very important that the personnel involved are on board with the OAC programme and, depending upon the prevailing culture, it may be necessary to carry out a condition appraisal of their machinery as an initial stage of the programme. This will enable the condition of the machinery to be established so that any actions required to restore it to a reasonable

evaluati o n

When getting started, it is best to select one or more ‘pilot’ or ‘demonstrator’ areas on the factory floor as a vehicle for implementing OAC in the business. It is advisable that the demonstrator is launched very soon after the communications programme has been completed.

operating condition can be planned and implemented. This will have the dual effect of not only improving machinery reliability and performance but also of illustrating the benefit of the OAC approach to shop floor personnel and obtaining buy-in.

Local shop floor personnel should take an active part in reviewing or developing the operator asset care tasks that are required in order to maintain and improve the condition and performance of their machinery.

The resulting OAC tasks and schedules should be produced in a user friendly format that can be easily understood by all production personnel. Training needs can then be identified and specific skills training put in place.

OAC benefits

We have established that OAC enables a cost effective maintenance regime to be developed and operated effectively and integrates the activities of production and maintenance personnel.

It brings a different approach to maintenance and encourages a change in attitude which benefits everyone within the company.

Working within a reactive maintenance, ‘I operate, you fix’ environment can be very stressful to production and maintenance people alike. It breeds despondency, apathy and a feeling of not being in control of the work/workplace and it leads to a great deal of waste.

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OAC has been tried and tested over many years, in many industry sectors and in many parts of the world and an overwhelming body of evidence proves that it does work. It makes manufacturing businesses more competitive, changes the working environment for the better, encourages and enhances people.

The approach is based upon the motivation, participation and enhancement of factory floor personnel, allowing them to have some control over their own working environment.

They are encouraged to look after ‘their’ machinery and ‘their’ equipment/tools and to actively

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care for your equipment History and evolution

In brief

For a manufacturing business to succeed, machinery and equipment and personnel on the factory floor must operate as effectively as possible, enabling the business to achieve the best return on each capital asset.

The best people to look after and improve machinery and equipment assets are the people who operate, set up and maintain them.

OAC is a proven approach to the achievement of effective machinery and equipment as it: Is part of continuous improvement.

Addresses all aspects of operational processes and facilities.

Allows the vicious circle of reactive operations/ maintenance to be broken.

Relieves maintenance personnel from routine tasks and a large proportion of reactive maintenance.

Provides a framework for company-wide improvements.

Motivates and enhances personnel.

Brings about a profound change in the culture of the business.

Makes for a nicer place to work and a more competitive business. participate in the improvement of production methods and processes.

They are trained and developed to realise their full potential and recognised for their contribution towards making the business more competitive and profitable.

OAC brings considerable benefits to factory floor personnel both in terms of an improved working environment and enhancement of their skills and personal attributes.

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hist o r y and

Change is always difficult and people are naturally apprehensive about modifying the way they work, their working environment and relationships with colleagues.

The changes that take place thought OAC will be proven to be logical and will be recommended not by outsiders but by people from within the company. E N D

evaluati o n

Any business which applies OAC in a thorough, committed manner can expect to achieve substantial benefits, especially when coupled with the effective application of other maintenance tools and techniques.

LMJ in conference This section features reviews of the events LMJ attends. Find out what goes on in the lean community by reading about some of the most interesting conferences and seminars.

Lean Society Summit Vicenza, Italy; September 20-21 Before arriving in Vicenza, I had no idea so many Italian companies had such an interest in lean. You rarely hear good news coming from the boot-shaped country, whose stagnant economy and political stalemate are certainly not helping SMEs to become more competitive on the global stage, but by listening to company managers and practitioners debate at this two-day summit I quickly understood that things are finally changing.

Italian SMEs are understanding the value of lean, and they are realising that in many cases it is the only way forward. A hunger for knowledge was almost palpable throughout the Fiera di Vicenza, where the summit was held and companies weren’t offered meagre portion to sate their need. Speakers of the calibre of Dan Jones and John Shook brought their knowledge and experience on stage, challenging more firms to embrace lean. A number of learning sessions were organised, with lecturers ranging from Frederic Naar, president of a tour operator that deploys lean to manage its dauntingly large amount of quotations, to consultants and lean managers.

Giacomo Pica from Kimberly-Clark took to the stage on the first day to tell the story of how the company’s Alanno site, in Abruzzo, became a model for the company’s other plants worldwide, including those in the UK (without a doubt a country where lean is far more well-known than in Italy). The next day, it was Pirelli’s Giovanni Pomati’s turn to speak. He explained the best way to roll-out lean implementation in global operations.

In many respects, Pirelli is a role model: its Pirelli Manufacturing System is used to standardise processes in every level of the organisation.

And it wasn’t just the food for thought to surprise me. I have to say that at lunch the risotto was phenomenal, and the wine we sipped was the best I had had in a while.

That’s the great thing about conferences in Italy, I guess. The organisation of the event was flawless, with even the collection of questions for the speakers being organised with a system under which anybody with a question had to write it on one of the cards provided and pass it down the row of seats in the auditorium. Questions were then collected and brought to Mr Arnaldo Camuffo, the scientific director of Fondazione CUOA.

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Camuffo is also the author of the paper Lo stato del Lean in Italia. According to this study, lean in Italy is still confined to the country’s northeast, the main industrial area.

In addition, 70% of Italian SMEs don’t know lean. However, the paper identifies an incredible increase in interest in continuous improvement since 2008. Italy has a long way to go to fully embrace lean, but the Lean Society Summit in Vicenza proved that several steps in the right direction are already been taken.

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Lean Product and Process Development Workshop Cranfield University; September 22 Can lean principles be adapted to a process as dependent on knowledge and creativity as engineering design? This is one of the questions this workshop tried to answer.

Members of industry were invited to attend, and their feedback and suggestions made for a very interesting day, up in Cranfield.

Dr Al-Ashaab Ahmed and his PhD and MSc students produced a piece of research analysing where the opportunities are in terms of finding space for continuous improvement in engineering activities. The aim of their work was to apply lean thinking to product development and create a model with associated tools that consider the entire lifecycle of the product, providing a user-centric design and processes that support value creation for the customer.

The three areas the LeanPPD research concentrates on are value focus, knowledgebased engineering and set-based concurrent engineering (which means considering a solution as the intersection of a number of feasible parts, rather than focusing on a set of individual “point-based” solutions), which lets several groups work at the same time to converge on a solution.

A lean design process can almost halve the time necessary to develop a product, by concentrating more on preliminary design and reducing the time spent on activities like testing and tooling. It makes perfect sense, really, as the engineering design process has a great impact on downstream costs: 80% of manufacturing cost is determined at the design stage.

Today, many companies develop acceptable products rather than offering what the customer truly values. It is difficult for designers to extract the knowledge they need, and innovation is therefore inhibited. Knowledge lifecycle was discussed, with the provision of a model addressing domain and previous projects’ knowledge. This was supported by the presentation of a case study on Metsec, a company that was able to reduce problems by 56% by developing a knowledge management framework.

The research team has also suggested a modified version of the A3 template that includes a column with the five LAMDA steps (look, ask, model, discuss, act) and keeps reflection (to identify the solution at the initial steps, to turn experience into learning and to enable criticism of the initial understanding of an issue) at its core.

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LMJ IN

A few attendees lamented a lack of attention on people, a fundamental part of any attempt to deploy lean, but the team explained their work voluntarily focused on a more “operational” approach, while appreciating the importance of having everybody involved. The feedback coming from this engaged audience made for a productive debate that will sure benefit the research as it moves forward.

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At the height of the workshop, Rolls-Royce’s Dave Lowe talked about the company’s successful application of value stream mapping to engineering processes.

Lean Business System Annual Conference 2011 Birmingham; October 11 People involved in lean seem to like their metaphors. During the first annual LBS Conference organised by SA Partners near Birmingham I heard a couple of memorable comparisons that really stuck in my mind. The first one was Marcel Schabos’, the CEO of Inalfa Roof Systems Group and former managing director of Cogent Power, who compared lean to gardening. “It’s not about the tools you use, but about the soil. If it is not good, there isn’t much you can do,” he said. The soil clearly represents the human factor. If you don’t make sure people in the company buy in on your improvement programme you can be sure that you will fail.

The second comparison was with music, and it was explained by Bob Emiliani, Professor at the Central Connecticut State University. It referred to the contrasting ideas of the seller’s market and buyer’s market. Within his session Emiliani focused on what respecting people actually means. Batch-and-Queue is easier for management and requires lower levels of skill: it’s like simple music that is easy to play but difficult to listen to. In a buyer’s market, greater skills are required and coordination is fundamental, much like in an elaborate symphony, which is hard to play but easy to listen to.

The day was not just metaphors, however. It was a challenging and engaging set of sessions that touched on the different elements that are necessary to achieve a lean business system. SA Partners’ Professor Peter Hines, who also chairs the new LeanBusinessSystem.com website, talked about the importance of involving suppliers in your journey and the risks that are run most often in implementation programmes.

He explained the “5S S curve”, an S-shaped line on a graph highlighting the difficulty to keep people engaged at all levels and the decreasing level of improvement experienced as involvement fades away.

Marcel Schabos shared steel manufacturer Cogent’s journey and the importance of continuous learning. He recounted how an initially reluctant CFO ended up saying things like “Don’t ask me about ROI of lean, lean thinking is a religion.” If this isn’t a clear sign of leadership conversion and commitment, I don’t know what is! Schabos has brought what he learnt at Cogent into Inalfa, where, he claims, total transparency ensures every employee understands the purpose of the business.

Professor Emiliani made a similar point, when he explained the meaning of respect for people, telling an engaged audience what Non-Zero-Sum is, an approach which sees a “win-win” situation as the most desirable characteristic of any business and doesn’t see people merely as employees, but also as suppliers, customers, and so on.

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Other sessions contributed to making the conference more interactive. In one of the track sessions, Professor Hines invited attendees to bring the example of their own businesses identifying their level of lean understanding or deployment, which made for an interesting debate and gave us a chance to compare our experience with others’.

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eBecs Customer Convergence Day London; October 12 In the crowded corridor of the Ambassadors Hotel near Euston, central London, Neil Ferguson Lee looks very busy running from one room to the next, greeting customers and talking to them about the latest products Microsoft has developed. Neil has been eBecs’ lean solutions architect since its inception. Lean and IT are, he says, “very close to my heart”. When I ask him what he thinks about the difficult relationship between IT solutions and lean techniques, he smiles and says: “A few years ago I introduced myself to Dan Jones, saying I was an ERP supplier. He looked like he had just seen the devil.”

He believes things are changing now.

It is quite bizarre to show up at an IT event with a lean agenda in mind. It is common belief that ERP and lean simply cannot go together, and there is still often furtive dissembling when the issue is raised particularly by IT vendors. Neil, however, is outspoken and confident of his ground. “Over the years there have been three main changes: first of all, R&D investment has increased. Second of all, lean is now better integrated within IT solutions; and finally the interface and its visual characteristics have been enhanced. How can you work an IT solution into a lean environment if you don’t have a clear visual interface?” he says.

The convergence day was an opportunity for eBecs to touch base with its customers after the company acquired ePartners. The two companies’ areas of expertise are manufacturing and the service sectors, which makes them compatible. eBecs prides itself on being the biggest UK pool of Microsoft Dynamics expertise, and hopes to become Microsoft’s leading partner in Britain. The company has good, mostly lasting relationships with its customers, who had a chance, throughout the day, to learn more about the new features and capabilities of Microsoft Dynamics AX 2012 and other solutions. The partners of eBecs at the event, ranging from Zap (an expert in analytics) to World First Autopay (a foreign exchange company), were available for demonstrations and to talk to customers about their own offerings, in the so-called Demo Zone.

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LMJ IN

In AX 2012, lean is fully integrated, allowing for execution and review of all replenishment strategies from one place and featuring new kanban types, as well as offering a better interface. It has production flow and value stream applications, and even monitors takt time. The lean fundamentals are well embedded into this system for which flexibility and simplicity are watchwords. The core lean principle of creating value from the customer’s perspective is clearly at the heart of the system’s design.

CONFERENCE

According to a Gartner research, only 38% of companies measure the value of IT. Without doing that it is easy to see ERP simply as a cost rather than an asset. A case study on JJ Food Service demonstrated how beneficial ERP can be in helping companies better respond to customers’ requirements. With AX, JJ Food Service reduced customer waiting time by 20 hours per day and saw order processing time going down by 25%.

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What the future holds Jon Alder, director of group lean enterprise at Rexam PLC, talks about the next steps this mature lean organisation is looking to take next.

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ou hear the phrase “going lean is a journey, not a destination” so often that it has become a platitude to cover the need for patience and constancy of purpose to lock in the cultural change necessary to become a lean enterprise.

Is that enough to inspire, motivate or lead people to the Promised Land?

My experience of 18 years in lean has shown me that it is not. You really have to think through the purpose of your lean programme and be prepared to reinvent it at all stages of the journey while staying true to certain basic principles along the way.

If we consider the “lean journey” as analogous to the concept of evolution, then we would not go far wrong. In evolutionary terms, the environment and other external factors shape the outcome of events so you either adapt and flourish, or you wither and perish.

I am sure everybody is aware of many moribund lean enterprise programmes around the industrial world. Maybe you have been part of one. So why is that? The tools and principles are undeniably appropriate for almost all business environments; therefore, it must come down to the approach being not fit for purpose. Again, taking the analogy of evolution, if you are not fit for purpose you will perish.

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This is the same for lean programmes. If we are not constantly responding to the rapidly changing business environment, new benchmarks and innovation; the never ending change in priorities; our customers’ and employees’ increasing levels of sophistication; using our improved embedded knowledge to challenge ourselves, then we run the distinct risk of becoming irrelevant to the business, a dinosaur. I have been privileged to lead the lean enterprise programme for Rexam, a global consumer packaging company with around 80 manufacturing facilities worldwide, for over 10 years.

We turnover around £5bn a year and are heavily invested in manufacturing capital. We are a supplier to numerous blue chip brand owners such as Coca-Cola, Red Bull, L’Oréal and P&G. We see lean as a strategic way of delighting our customers and growing our business, but to do that it has to become part of the DNA of

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In 2000, Rexam committed fully to becoming a lean organisation. The first hurdle was to explain what that meant for people, then set the context so that they engaged. We started with a very simple toolbox that was easily applicable to our capitally intensive business. We saw results.

Results create interest. Interest created demand for more activity.

After several years of a simple consistent approach people needed more. More challenges, more tools, more recognition in fact. Rexam then defined the next aspiration as using the tools in a way that delivered system change to achieve flow and sustainable value creation.

Our attempts to build lean principles into our non-manufacturing areas are gaining good traction. We intend to certify our South American headquarters next year through the Shingo process which we believe may be unique in concept. We are also pushing the concept of digitisation to maximise the speed of our new lean processes now that the waste is removed.

This is typified in our work around customer service where our aim is to become “easy to do business with”, followed by being the “best to do business with”.

So the map is laid out for the journey, and with the right ambition it just becomes a function of time. If we keep to our basic principles but learn to adapt to the changing environment and stay fit for purpose then we have a great chance of embedding a sustainable culture of Lean Enterprise. E N D

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Our basic philosophy is that Lean Enterprise is a facilitator for the continuous

So where next for Rexam? We realise that we need to set new challenges constantly to maintain momentum, so this year we have embarked on achieving the Shingo Prize for our most able plants. We currently have four plants in the process but our aim is to make this the standard for all of Rexam, and as our plants and functions mature through the various stages described earlier then they can realistically aspire to become truly world class.

c o mment

In 2008 we made further advances with a business challenge to push our nonmanufacturing elements of the business to adopt lean practices. Again new tools were needed but only thanks to the increased sophistication of our people and their embedded understanding was this possible.

If we had started here in 2001 we would not have achieved any traction.

improvement of our entire business to achieve operational excellence, and nowhere is this exemplified better than in the collaboration between our lean programme and our health and safety programme, where the concept of “safety Kaizens” is delivering outstanding results. This has led us to consider the concept of “the Safety-Belt”, a safety professional with the continuous improvement skills of a Black belt. A potentially powerful combination.

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our business. And therein lies the challenge because it will not happen overnight. You need to maintain interest and motivation to maintain the momentum. You need to link lean to other business initiatives that are ongoing so it is seen as a facilitator to these. You need to link lean knowledge and leadership to career progression so you are building a tranche of leadership that thinks about it at a principle level, not just in terms of projects and savings. In fact Deming said it best of all – you need constancy of purpose. My only addition to this is you also need to reinvent yourself so you are always fit for purpose.

What counts is the outcome All methodologies have their merits, but they are not an answer in themselves. Organisations that fail to look at the bigger picture are missing an opportunity, says Philip Black, chief operating officer of emergn, a professional services consultancy specialised in helping companies overcome their organisational and IT business problems.

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any times organisations that choose to adopt lean often lose sight of what really matters, namely extracting value and remaining focused on the outcomes. While it may sound obvious, it is all too easy to forget that a philosophy or methodology is not an end in itself. It is a model that allows people to understand how to work together. During transformations to new ways of working, deliveries may fail, because undue focus is put on doing the methodology right. And as products and projects become ever more complex and time-to-market more pressurised, traditional approaches of serving modern markets are no longer delivering against expectations of shareholders and customers alike.

A growing number of organisations have a new way of thinking that has grown from the experiences from the agile and lean communities to name two, but is more focused on business outcomes and delivering value. By keeping some basic outcomes at the forefront, they are able to reduce complexity and see tangible improvements fast, as well as creating a foundation for the future whilst still learning better practices.

They’ve also avoided some common pitfalls, such as focusing on ‘How well are we doing scrum?’ or ‘How much more waste do we need to remove?’.

Changing focus

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The reality is that any organisation is nothing more than the collective capacity of its people, and their ability to make decisions and deliver improvements in a way that creates value for their customers through their products and services. So, to create value within any project, change management or business transformation scenario, people need to be empowered to make the best decisions to meet the expectations of the environment. Yet, the traditional approach for managing products and projects is looking increasingly outdated, disconnected and static to meet complex environments.

So what does work? A focus on three outcomes: how do we always increase value, improve flow and advance quality?

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The most successful organisations understand that value is created for customers, employees and shareholders, yet it has become common to use phrases like ‘customer value’ and ‘business value’ as if they are separate concepts. Sustainable value cannot be created for one group unless it is created for them all. Organisations continue to view value creation narrowly, optimising short-term financial performance in a bubble, while missing the most important customer needs and ignoring broader influences that determine their longer-term success.

In order to determine value, three areas need to be considered in order to determine the constraints and trade-offs to be made: feasibility (what is functionally possible within the foreseeable future and can be delivered by your teams), viability (what is likely to become part of a sustainable business model), and desirability (what makes sense to people and what would they buy).

Agile and lean don’t have an inherent answer for value. They do have roles, practices and tools that help create an environment for trade-off and prioritisation discussions to be had throughout the process. For many enterprises the out-ofthe-box model is too simplistic for complex environments. Developing lightweight economic frameworks that join together business outcomes with day-to-day work enables ideas to be compared and contrasted to maximise value creation throughout an organisation, and allows engaged people to make better decisions on a day-today context.

Value in relation to time and quality

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The third pillar in driving value is quality and while quality models are well established its concept is often ambiguous and misunderstood across a company. A solution lies

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The constraint of time is rarely measured in value affecting terms. As a result, strategic benefits remain unrealised, creating risks that ultimately prevent value creation.

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Flow – in other words, seeing change take place – is essential to value, yet in many organisations takes too long. Delivering features to a customer is often bound up in the systemic issues of an organisation and cannot be dealt with by any one function alone. It can take months to actually start a project from the time the idea was conceived. When it’s delivered it’s often too little too late, potentially preventing the realisation of the original intended value. Here are some of the common problems: Focusing on productivity to maximise the amount of work undertaken at any one time reduces focus and the overall amount of work completed.

Grouping changes to make funding decisions easier and ensure delivery introduces complexity, long cycle times and feedback loops, and introduces invisible queues and obstacles.

Governance breaks processes into phases and gates which slow down change into excessive hand-offs between functional groups rather than learning opportunities for cross-functional teams.

Outsourcing to reduce costs which fails to solve the real problem of flow.

What counts is the outcome continued:

in taking a value perspective. This means balancing the value and the cost of quality for each characteristic of a product, taking into account a longer term view because quality will have an impact on dependability, speed, flexibility and cost in the future. Quality needs to be holistic and built into the flow of value, and is the responsibility of all members of an organisation, and not just a testing team.

Remember to focus on the outcome

Here’s an example: a client recently wanted to transform its delivery approach, particularly focusing on one system used by approximately 4,500 staff to make 25,000 customer bookings per day. It needed to be reliable and adaptable in order to better serve customers and the business. The client in question received hundreds of ideas on how to make the system better, but was taking far too long to implement these ideas, leading to frustration for the business and customers. The company had already tried to deploy Scrum within other systems but had failed because the focus was on methodology.

Improved prioritisation

A new approach was designed to prioritise requirements, irrespective of who raises them. The business became faster and better at doing that. The conversation switched from ‘my changes’ to ‘changes most important to the business’. And, most importantly, the new process allowed the company to react faster to market and customer demands.

Reduced size of requirements

One of the changes implemented to improve the development process was the process of breaking down selected ideas into bite-sized requirements. This helps to smooth the flow of work through the development process, resulting in more manageable, sustainable delivery of changes with reduced risks.

Before implementing these changes, the business had a long and drawn out process for scoping and design. Requirements would take a long time to go through the development pipeline. The new framework allows it to implement smaller changes much faster to keep up with the changing business and customer needs.

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The above changes, alongside others based on focusing on value, flow and quality are already starting to make a big impact on the speed of IT development. As a result of these changes to the booking system, huge reductions in the average time it takes to go from a raw business idea to a working solution have been delivered.

For more information, visit www.emergn.com or follow emergn on Twitter at http://twitter.com/emergn E N D

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A British perspective on a global lean journey Dougal Fraser, of consultancy OEE, talks about the large numbers of British lean professionals in the service sector worldwide, and shares his idea on why there are so many.

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ike many practitioners, I started my lean journey in manufacturing operations management. In my case it happened to be chilled food production. However, about six years ago, having taken a year out to complete an MBA, I decided to change direction and pursue a career in consultancy. I was interested in using my experience in manufacturing in other industries and joined OEE Consulting, which had some interesting clients in the service sector.

Whilst the world of banking, insurance or healthcare at first appeared daunting to me, I quickly found I could add value and cut my teeth in back office processes of major banks. Working in partnership with client teams, I was able to learn about their sectors and at the same time upskill them so that together we would be able to identify waste around them. Interestingly, my work has evolved from high volume simple operations to more complex areas with variable demand and higher discretion. For the past three years I have been racking up air miles working for multinational organisations that are successfully embedding operations improvement and lean initiatives across the globe. I have been working in different locations and with different cultures (US, India, Philippines, even Japan). This article is based on my observations during my lean journey (quite literally) from manufacturing in the UK to the service sector around the world.

The more I travelled and observed large organisations, the more I became aware of how difficult they find it to recruit high-calibre experienced lean professionals that blend the right mix of technical knowledge and sector experience. According to my experience, quite often lean practitioners leading charge in service organisations around the world are British. This observation has intrigued me and raised the question, ‘Why is this?’

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Having had too much time to kill in airport lounges but not enough time to formally carry out a research, I thought I would share my hypothesis with the LMJ readership.

Is one of the key reasons the UK has a relatively high number of lean experts successfully operating in the service sector connected to the much publicised decline in British manufacturing? While looking at manufacturing output figures this may be inconclusive. However, the chart below, derived from OECD data of the numbers employed in manufacturing from 2002 to 2008, starts to highlight that

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The service sector globally struggles to recruit staff capable of ensuring the growth and sustainability of major lean programmes. Meanwhile, recruiting lean practitioners with service experience in the UK has become easier as the pool of potential candidates has grown. This observation led me to the conclusion that whilst there is a wealth of operational knowledge around the world, it is often still vested in the manufacturing sector and migration to the service sector is less common than in the UK.

A British perspective on a global lean journey continued:

% Movement in manufacturing employment 2002 to 2008

the scale of manufacturing reduction has been most marked in the UK. Therefore, can we conclude that a catalyst for the growth in the number of British lean practitioners operating in the service sector is born from economic necessity? It would seem people have been forced to follow the work and adapt their skill sets to new sectors.

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Besides the decline of UK manufacturing, what other factors could be part of the reason why I meet so many fellow Britons around the globe leading lean initiatives?

Good operations management and lean are often aligned with engineering disciplines.

These skills perhaps are not held in such high esteem in the UK as they are in other countries such as Japan, Germany or France. My perception is that it’s more likely that the chief engineer or operations manager could one day run an entire organisation in those countries, and thus have a longer potential career path than they would in the UK. This idea may also be supported by the notion that the UK admires and values more generalist management skills, the skill of management itself. This in turn is driven by the education system where

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United Kingdom France United States Germany Japan Italy Czech Republic Poland

what you study does not necessarily dictate what you will go on to do. Therefore, we could conclude that in the UK as well as in the US it is far more culturally and socially accepted that people switch jobs and employment sectors. It might also be argued that with the operational improvement mindset that lean provides, individuals may be even more inclined to challenge the status quo and ask themselves the question ‘Why shouldn’t I change career?’

I also suspect the way lean has evolved in the service sector, especially in UK banking and the insurance sector, in the last 10 years has been a further incentive to job migration. The starting point for most organisations was to focus on the back office high volume, low complexity areas as they started to industrialise their processes. Lots of banks branded these back office functions as operations and even manufacturing. As traditional manufacturing employment shrunk the operational improvement work in service grew.

Moreover, this was initially more aligned to simple repeatable tasks typified by low discretion work on the lean continuum, allowing manufacturing migrants an easier

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OEE Lean Continuum Low descretion work

High descretion work

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adjustment to the culture of service operations. Once established, the early pioneers could then encourage further migration as well as coach internal staff whilst also becoming accustomed to different cultures and ways of working in their new environment. This in turn allowed lean to start being used further to the right of the lean continuum (see figure below) in ever more complex, high discretion work areas such as compliant handling, underwriting and investment banking.

In light of my observations above, can we conclude the reason lean professionals in service are often British is the result of the cultural and sociological disposition to consider different work sectors coinciding with the need to find new positions, all occurring at a specific point in time?

This is an intriguing hypothesis to me, which certainly merits further research. If my intuition is correct it would be encouraging to think that Britain is currently the centre of excellence on lean practice in service, even if we do seem to have a historical propensity to innovate but then fail to turn innovation into commercial opportunities.

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It’s still difficult to find and recruit high quality lean professionals into the service industry across the globe. If my hypothesis is correct, recruiters should look at the UK. Nice thought if you’re a Brit, but it’s not always an easy option for somebody from the UK to adjust to the culture of a different country while trying to drive change. Any failure would seriously jeopardise the future credibility of lean within that location. Therefore, should the service sector widen the search for lean and operations professionals in the manufacturing sector within their own country and spend time on helping them adjust to service culture? This would seem sensible if the work type they are dealing with was on the left side of the lean continuum, as it would assist the transition as it has in the UK. However, if the work content was more complex, at the right side of the continuum, and therefore of higher discretion then perhaps it would be best to seek good internal staff with the right attributes, company knowledge and specific sector skills and coach them in lean thinking and good operational management by providing specific learning and development programmes. Much of my recent work has involved working with local staff who are changing their career path to operations improvement in their respective companies. Carefully chosen for their competences, they were equipped with the skills they need to really add value to their businesses. In my view, the future of lean in the service sector around the globe will be one of learning from one another. E N D

A new breed of systems engineers Keivan Zokaei, visiting professor at Buckingham University and head of research at SA Partners, responds to Chris Daffy’s article in the February issue of LMJ on why lean has failed in the service sector.

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his article provided some useful and interesting insights into why ‘lean has failed in the service sector’. However, it is worth asking whether companies, such as BAE systems, have been looking into the wrong box for answers to their service operation problems.

Chris makes a distinction between competence and character of the service organisation, pointing out that the lean school of thought could lack credence when it comes to service character owing to the fact that lean practitioners are by and large engineers who know little about consumer experiences and expectations. Chris adds that, as such, lean engineers create “systems that are very efficient but dull, perfect but boring, slick but heartless”.

Chris’s observations are often but true. ‘Lean toolheads’ go about applying manufacturing solutions to service systems with little attention to their fundamental differences.

However, that has got little to do with the credibility of lean, engineering mindset or the scientific management methods of TPS.

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Lean thinking was codified and popularised in the 1980’s by researchers who were mostly informed by industrial engineering or operations management thinking. However, Toyota engineers themselves had drawn upon important systems theories to create what Western authors later dubbed as lean (not an apt name with hindsight!).

Taiichi Ohno, the father of Toyota Production System, and his colleagues not only understood Kingman equation and Little’s Law (industrial engineering) but also learnt from Dr. Deming, who was a great systems thinker. There is even evidence that they had familiarised with the work of Checkland on

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Soft Systems Method. Toyota engineers, like any good engineer, used the cutting edge of science coupled with robust scientific discovery methods to create the most acclaimed organisation ever. The very same disciplines of science and very similar engineering improvement techniques can rescue the service sector from on the brink of assuming the summit of notoriety (look at problems in financial sector, investment banking as well as your own experiences with insurers, travel providers or even bus operators).

I am uncertain whether Chris has consulted any of the key schools of thought in systems thinking, in order to come up with his set of recommendations or he has actually developed them through own experience. Either way, he has done a good job – as the list contains some of the key components of systems engineering. For example, Ashby’s law of ‘requisite variety’ explains that “only variety absorbs variety”.

This principle should help service engineers understand not to ‘dumb down’ the service system through excessive standardisation and to avoid some of the lean standardisation protocols widely applied in manufacturing systems (manufacturing systems have far less embedded variety). I agree with the “Straightjacket implementation” principle too. For example, Darrel Mann, who is an expert on TRIZ and a systems thinker too, observed that six sigma often has a side effect in the form of dampening innovation which – I add – can be deadly in service systems. Real lean is about continuous improvement and ‘human systemisation’ (or Jidoka) rather than ‘dumbed down standardisation’.

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Although, we do need a new breed of systems engineers who can translate those basic theories into more functional applications for services. E N D

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Russ Ackoff reckoned that “doing the wrong things righter” is the recipe to disaster. So I agree with fellow editorial board members, Wendy Wilson and Peter Watkins, that the fundamental scientific methods and solid scientific theories are just as much applicable in the service arena as they have been in manufacturing.

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Finally waste elimination per se is hardly enough for a company to become a great company. Good engineering is about designing systems that focus on value enhancement and elimination of those underlying issues which prevent the organisation from boosting value to customers (and the society at large for that matter). That is fundamentally different from the efficiency logic of Western management thinking which is squarely focused on cost cutting and profit seeking.

The SCGM Way In this new column, LMJ observes the lean journey of Serbian company SCGM. Sandra Cadjenovic, the director of this SME specialised in the manufacture of injection tools, shares her thoughts on the company’s first steps into the implementation of its bespoke continuous improvement programme.

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fter being conceived as the Toyota Production System by Toyota Motors in Japan, lean management has proved to be a very effective tool for many other large corporations. They fully understood what Toyota pioneered and the tremendous potential of lean, and they learnt how to use it to their advantage.

And then there are small and medium enterprises, which constantly struggle to keep their place in the global market. Looking up to larger companies, they too have recognised continuous improvement is a way of reducing costs while increasing the quality, thus achieving, to some extent, world class performance.

The Republic of Serbia, shaken by political instability and economic crisis for years, has been in a slump for a very long time, with high unemployment rate, low income, corruption and general dissatisfaction among people.

These factors made the country very unattractive to foreign investment and kept it out of international affairs. However, after a change in the political regime, the overall situation has started to gradually improve.

A highly skilled and qualified workforce, in particular, has made Serbia a much more appealing market for foreign investors.

There is some good ground to work on, hard-working and skilled people to work with and a will to improve things, locally and nationally. And this is our starting point.

SCGM

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SCGM is one of several SMEs operating in Serbia. It is a multinational enterprise (present in Germany as well), founded in 2004. Since then, when it counted only two directors, the company has grown and now has 50 employees. SCGM is specialised in the design and moulding of injection tools, injection moulding and assembling.

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Our philosophy is to achieve top quality and knowledge. In order to do so, the simple tools we used along the way proved not to be enough.

We constantly faced losses, waste and poor workplace organisation.

Having found out about lean methodology, the owners visited a seminar in Kragujevac, Serbia, where they sought a deeper understanding. The idea of continuous improvement, presented by experts in that field, immediately appealed to them and stuck in their minds. Recognising the various types of losses in the process, analysing the main causes and reasons, defining the right actions, improving processes and performances and eliminating losses is what the lean was offering them. They soon decided to introduce the new methodology in SCGM.

The beginning of the journey

The methodology proposed by Tecla Consulting, the consultancy called to support the company’s journey, is oriented towards the improvement of the overall operational and managerial performances, systematically involving everybody working inside the company and organising work within it.

This involvement results in a behavioural change focused both on continuous improvement and on the maintenance of the improved operational standards. The empowerment of people at all levels of the organisation and the definition of precise operational standards allow for the delegation of daily management activities (such as autonomous management of workstations): a strong training effort is being made to develop management capabilities necessary for improvement.

The solution of complex and crossfunctional problems - the basic requirement to achieve performance improvement - remains a greater responsibility of top level management that will work against problems with specific teams.

The role of leaders is to lead the development of the overall capabilities in a harmonious manner, and, in particular, to orient the strategy, choose the themes and fix the targets starting from the deployment activity.

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The SCGM Way to continuous improvement consists of four phases: a Foundation phase and three development phases (Pilot, Expansion and Stabilisation).

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Foundation workshop value stream costing Masterplan

Method Experience Results

Extention Involvement Results

Standardisation Consolidation Your way!

Model area:

More model areas:

Complete plant:

Top management Setting diretction

Middle management Team leaders

Establishing priorities

The Foundation phase helped people to understand the meaning and main activities of the SCGM Way programme. Various tasks and simulations of the problems and solutions were provided, one of them being the Tennis Ball game. People were divided in two teams of six, and they were given tennis balls that they had to pass to each other in the shortest possible time. Through the game, the employees recognised the issue of time loss and the importance of team work.

The Steering Committee, together with the consultant, visited the assembly department, recognising waste on the very spot. Assembly employees were involved in the whole process, to let them know their role is crucial.

Over the next few weeks, the programme will focus on the project areas identified by the committee, pilot teams will work following a PDCA approach, kaizen activities will be reported to follow up on the improvements in terms of results and benefits for SCGM.

To have your say, share a piece of advice or simply comment on SCGM’s progress, visit our blog, lmjournal-blog.blogspot.com

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To be continued… E N D

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Besides this, the main tools were utilised, a Steering Committee was created and future activities were planned. By the end of the phase, PDCA for the various activities was carried out - employees worked on reorganising the workplace, cleaning up everything, both in the offices and on the shopfloor, taking photographs before and after.

In the next phase, pilot teams were launched with the aim of attacking some of the most critical problems the company faced and also of starting to prepare for data collection. However, like in the first phase, people were first taught how to do it and given examples as well as tasks. This time, they were given the task to complete a weekly data collection of one company and, based on it, they had to understand and calculate the OEE. This way they found out which and where the main losses were and where to ‘attack’ first. The task was successful, and the application of the lesson they have learned will soon follow.

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The project started in September and, until now, the first two phases have been introduced into the company.

B OO K R E V I E W J ohn B icheno

John Bicheno reviews Lean IT , by Steven Bell and Mike Orzen, CRC Press, 2011

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t is amazing how long it has taken for ‘IT’ and ‘information age’ thinking to permeate lean thinking.

Of course, Womack and Jones, and Rother and Shook wrote about understanding information flows alongside material flows more than 15 years ago, and visual communication is a central concept in lean. Yet, with few exceptions (such as Gonzalez-Rivas and Larsson - reviewed previously - and the Poppendiecks work on lean software development), lean is still strongly about physical flows. In fact, lean has represented a retreat from IT applications such as computer based materials management, MRP, MIS, and ERP. Bell and Orzen have made a brave attempt to redress the balance.

This is long overdue. In general, this is a book for manufacturing organisations, not service organizations (for the latter I would strongly recommend GonzalezRivas). There appear to be two target audiences for the book. The first is the IT professional that does not know much about lean. This group will probably find the first section useful.

Here an overview is given of many

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of the conventional tools of concepts of lean.

However, it is a pity that some lean frameworks are not presented, and I fear that such IT people will be left with the impression of lean being a bewildering array of tools.

The second section attempts a bridge between IT and lean, making statements such as ‘kanban is an information system for pull’ and discussing in very broad terms topics such as strategy deployment, A3, performance measurement and lean accounting. Unfortunately the role that IT can play in these areas is not developed. This is a great opportunity lost.

The second audience is the experienced lean practitioner that does not know much about IT. This group should begin the book half way through in Section 3. Here, lean practitioners may well find the overviews of ITIL, lean software development and project management useful as an introduction.

In Section 4, leadership and a ‘Lean IT Roadmap’ are discussed. These two chapters are general, hardly relating to IT. I would recommend Hines et al, Staying Lean, instead.

For me, the best section is the case studies, presented in Chapter 5. These ‘whet your appetite’. It is a pity this section is so brief because getting into the detail of what organizations such as Con-way, Ingersoll Rand, Steelcase, and Virginia Mason would be a great way to really open up an often-ignored but muchneeded area of lean. Steve and Mike, I really look forward to the second edition that could cut down earlier sections and expand the later sections.

Even better would be two books – one for lean practitioners interested in IT, the other for IT professionals in lean organisations. E N D

EVENTS There are currently an expanding pool of events available for the development of the lean community which offer both general and sector specific opportunities to renew your enthusiasm and gain new perspectives through communicating with lean contemporaries.

Forthcoming events from LMJ include: Lean Directors’ Seminar 2011

November 30-December 1, Ambassadors Hotel, London This two day seminar is designed to support your individual lean journey. It includes a comprehensive introduction to the visual workplace and to best practice regarding the behaviour, knowledge and skills needed to direct a true lean and sustainable business transformation. The first day of the event will focus on visual management, with Gwendolyn Galsworth of the QMI/Visual-Lean Institute. The second day will feature six inspiring case studies, including Rexam and Citibank.

For more information on our events or to attend, please contact Benn Walsh at +44 (0)207 202 7485 or b.walsh@sayonemedia.com

Other LMJ events include: November 30, Rickmansworth, Hertfordshire To be able to deliver improvement and drive transformation, BP professionals must meet the increasing demand to lead BPM, lean, and six sigma initiatives.

This event, organised by Forrester Research, will focus on what the latest thinking on transforming the customer experience is; on how back-office and frontoffice processes are integrated, continuously improved, and even transformed to differentiate customer experiences while driving down costs through the use of new technology; on how agile BI, predictive analytics, business rules, and social BPM align to create nextgeneration BPM; on how companies can address crucial “softer” issues while still delivering successful results; and on how new, disruptive technologies like cloud and predictive analytics affect business process transformation.

Orlando Process Excellence Week 2012 January 16-20, Lake Buena Vista, Florida

Organised by IQPC, this is the largest annual meeting as part of PEX networks Global Summit Series. Running for over 13 years, it has a longstanding history in bringing together the Process Excellence community for networking, knowledge share and benchmarking.

With speakers like Nimbus Partner’s Richard Parker and Steve Tower, founder of the BP Group, the week will enable over 700 attendees to fuse together lean, six sigma and BPM to enable true enterprise-wide excellence; refocus critical improvements from internal excellence to customer experience; and discover how to maximise ROI and tangible business value from Process Excellence programmes at all levels of the maturity model.

Lean in Service and Higher Education January 25-27, University of Portsmouth

This international conference will explore the transformation of the public sector through lean and other high performance methodologies. The conference will provide a platform for academics, practitioners, public sector leaders and communities of practice to come together to explore, develop and exchange outcomes of high performance methodologies in the public sector. Keynote speakers at the event will include Professor Zoe Radnor from the University of Cardiff, Professor Bob Emiliani (via videolink) from the Central Connecticut State University, Clive Hutchinson from Cougar Automation, Dr Steve Martin of the University of Coventry and Owen Buckley, from Portsmouth City Council. Masterclasses will be offered at an additional price.

For more information or booking details at all LMJ’s partner events please visit:

www.leanmj.com

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Business Process Summit Europe 2011

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