Lean

The Power of Lean: How Leadership Transformation Elevates Company Performance

Posted on by Adam Payne

By now, you’ve probably heard about Lean. It’s a powerful approach to management, which has its roots in manufacturing, but is used by many companies large and small to improve their processes and products.

As its name suggests, Lean is about eliminating waste — anything that doesn’t directly add value to the customer. This includes waste in time (waiting), materials (overproduction), money (overhead) and energy (people working on the wrong things).

Lean is a journey — not just a set of tools or tactics — and it takes time to become effective. But it can transform how you manage your people — giving you more time for important activities like coaching and developing your people so they can do their jobs better.

The Lean Leadership Journey

The journey to a Lean organisation is not an easy one. It requires a holistic approach and a complete mindset change. It takes time, effort and dedication to make the transformation successful. And it’s never over!

The following are some of the steps that you can take to start your journey toward becoming a Lean organisation:

Get everyone involved in the process. The Lean Transformation cannot be achieved through top-down management alone. The leader must work closely with employees at all levels to implement changes that will make the organisation more effective and efficient. Employees need to understand how they fit into this process, so that they can contribute effectively.

Set goals for improvement and measure progress toward those goals regularly. One of the primary reasons for implementing Lean practices is to improve business performance and increase efficiency, but measuring results will tell us if we’re moving in the right direction or not. We need to be measuring against specific goals set out at the beginning of the process (or before it began). This also helps us identify areas which need improvement as well as areas where we’re excelling.

The Lean Leaders Standard Work

Lean leadership Standard Work is a system that encourages continuous improvement and provides a framework for facilitating change. It requires leaders to focus on their actions, behaviours, and tools in order to drive continuous improvement in their organisation. This Lean Leadership Standard Work can be applied to managers, supervisors, directors, and executives alike.

Lean Leadership Standard Work encourages and promotes employees in organisations to reduce variation and improve performance. It also develops team members by demonstrating how to make smart changes and support people by defining what they should do when they take action.

Lean Leadership Standard Work can include:

  • Develop process standards alongside the process operators
  • Observing processes in action (Gemba Walks)
  • Asking 5 Why questions
  • Identifying gaps between standard & actual work (Audit)
  • Supporting process improvement
  • Coach and Mentoring Employees
  • Empowering Accountability and Responsibility
  • Deploying strategy

Lean Thinking as Leader

Lean Thinking as a Leader is about management that encourages you to make the most of your team and organisation. It is about creating an environment where people feel comfortable thinking “outside the box,” and where ideas can be considered, implemented, and monitored so that adjustments can be made quickly.

It requires leaders to be open-minded and encourages them to listen carefully to their team members’ ideas and suggestions. It also encourages leaders to collaborate with their teams in order to come up with better solutions for problems or issues. When everyone feels like they’re part of something bigger than themselves, they’ll be more likely to work hard toward achieving success in whatever it is they’ve been tasked with accomplishing.

The Lean Leader as a Teacher

A key concept in Lean is that people learn best by doing. Leaders must therefore create an environment where learning can happen, by encouraging employees to take on projects and responsibilities that stretch them, while also providing coaching and feedback along the way. The goal, according to Masaaki Imai (the author of Kaizen), is to help each employee become “Kaizen conscious, developing skills and tools for problem solving” — and this requires a great deal of effort on the part of managers in order to ensure that all employees are given opportunities to learn, grow and improve within their roles at work.

Eliminating waste is a key Lean Leadership Principle

Waste can be defined as anything that does not add value to the product or service being created. Waste occurs in all processes and can be categorised into three types of wasteful actions that negatively impact workflow, productivity and ultimately, customer satisfaction.

  1. Muda (or non-value-added work). These are activities that do not add any value to the end product or service, such as, Overproduction, Inventory, Defects, Motion, Over-processing, Waiting, Transportation.
  2. Muri (or overburden). This is when workers are asked to do more than they can handle efficiently, safely, or ethically.
  3. Mura (or unevenness). This occurs when there are unexpected fluctuations in demand for products or services due to things like seasonal change or competitor activity.

Waste takes time and resources to create, so eliminating it saves time and money.

Lean Leaders Put Customers First

Lean leaders are customer focused. They don’t waste time or money on anything that doesn’t directly improve the customer experience, and they know that this is the best way to grow their business.

This means that lean leaders put their customers’ needs first by:

  1. Listening to their customers and understanding their challenges and needs.
  2. Paying attention to what customers think about the product or service, and how they use it.
  3. Identifying areas where they can improve the products or services based on what customers say.

Takeaway: Lean leadership is about learning and improving.

A company benefits from having the right leadership in place, which ultimately helps a business to grow. They’ll learn from your customers, try new things, and challenge you in new ways. They’ll collaborate with others and actively seek outside support. Without good leaders, or without lean principles guiding those leaders, you’re going to get the same results: no learning and therefore no improvement.

Boost your team’s performance and your leadership potential with New Way Growth’s personalised Helping Managers to Succeed and Lead Programme. Let’s shape your leadership success story today!

The Lean Bug!

Posted on by Adam Payne

Whatever you think of when you see the words “Lean Manufacturing” or “Lean Thinking” you cannot get away from the fact it is a set of business principles, which, when applied, deliver exceptional results.

Over my career, I have seen the impact and benefit that Lean Manufacturing brings to any size of business, from an Engineer (in the 90s) working at an Small SME to a Corporate Exec (2009) implementing Lean Strategies.

I personally got the bug for Lean working for a small company called Linread Northbridge (although part of McKechnie Plc). We were making precision fasteners for several sectors but predominately Aerospace. The MD at the time gave me a book to read on “Kaizen” and I was hooked. From then on I have implemented Lean within every business I have worked in to now helping Manufacturing SMEs with short, high impact Interventions to major Lean Programmes and Strategies.

My first Kaizen event in the 90s was facilitating a SMED event on a Header Machine that took a whole shift to change-over from one product to the next, being trained, coached and mentored by a Japanese Sensei. We got the change-over down to 30 minutes. Through using the correct KPIs and driving root cause analysis I’ve increased production output and capacity in manufacturing cells that businesses have said couldn’t be done. I’ve moved 100+ machining centres within 5 days to create flow and as an Exec have put in place Strategies that realised Savings of +£15m within its first year.

Anything is possible if you put your mind to it.

I’ve heard the words “it won’t work here” more times than anything and I can tell you it’s Bu&*s*&t. The smallest improvement can have the biggest impact and everyday day is a day to grow and develop your potential. (Marginal Gains – The doctrine of marginal gains is all about small incremental improvements in any process adding up to a significant improvement when they are all added together.)

The skill is adapting, modifying and re-designing those business principles to ensure you get measurable and sustained business performance, after all in its simplest form all you are doing is looking at a time line from ‘Sales & Marketing through to production, production through to Customer Delivery’ and reducing that time line by removing the Non-Value Added wastes within it. Yes there are loads of tools and techniques that go hand in hand with that, but the biggest one is leveraging the knowledge within your people to drive continuous improvement.
Lean Manufacturing is not merely a set of mutually supporting techniques, it’s a change in the organisation’s culture and thought processes. The benefits to any business (regardless of size) are huge, and are only limited (in my opinion) by your Organisation’s Culture and Leadership Behaviour. Companies that fully commit to Lean dramatically outperform their competitors over time.
So get as close as possible to where the work is being done, lead from the ground up to first find what the real problems are and then face and resolve the underlying challenges.

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Miss that moment – and you start to decline.

Posted on by Adam Payne

“There is at least one point in the history of any company when you have to change dramatically to rise to the next level of performance. Miss that moment – and you start to decline.” – Andy Gove

My personal view and experience is that it’s more than one point in time.

SMEs are characterised by their ability to adapt easily to market changes and their lean organisational structure (not as in Lean Manufacturing), which results in a more dynamic environment and a quicker decision making process. Although SME businesses vary widely in size and capacity for growth generally they will all follow a similar path: going from Owner/Entrepreneur with two or three employees to a business aiming for £10m or even £20m per year, and experiencing 20%/30% year on year growth and upwards along this journey. The sketch below illustrates an example of this, showing where most businesses may feel the pinch points of growth at key intersections.

SME Journey and Growth

Zero to £5m

The hard work really kicks in here. This part of the journey is often the one that is the most lonely, but often the most exciting. But it is here that most business owners feel the pains. Because it can be a lonely place, it is easy for owners to doubt themselves, they also don’t know what they don’t know which can be a limiting factor. And as an owner one of the main areas of responsibility is simply getting things done, which means you are working in your business as a manufacturer, and not working on it as a strategic leader.

In smaller SMES, management structures are also small with most owners being very hands-on. People are stretched across all functions all processes. Systems are not in place, IT is minimal or non-existent and there is a lack of standard processes. Utilising the Continuous Improvement and Management graph we can see that all levels are being worked with a very lean structure. Small customer projects, odd-job shop style of working.

SME Zero to £5m

As we get closer to a turnover of £5m, it becomes clear that things need to change. We are then moving from that odd-job, one off customer delivery to a mix of bigger projects, possible increased volumes and an increase in market share from your customers. As we start to scale-up from the initial start-up, decisions have to be made about the organisational structure, the company’s technology infrastructure, its business and marketing strategy, etc. With regard to organisational structure, you might now start to see the requirement for supervisory position(s) to take on more of the owners duties, the labour force growing, new machines, loans, investment, functional departments, Operations, Quality, Sales, Technical, Finance. This is where it can be rise or decline with those decisions. In scaling and growth and the opportunities it also brings its own set of problems, (albeit they are nice problems to have because its growth).

£5m to £10m

IT Systems and Planning may start to become an issue here, Microsoft Excel may no longer be good enough to manage your shop floor requirements (although I have seen £100m business still using excel but it was beginning to creak), and you are likely at this level to be considering MRP/ERP implementations. You may also look at outsourcing some functions, like Sales, Human Resources, Engineering Support, Quality, Quality Accreditation. All this requires a lot of investment in terms of time, money and energy. You need to do your homework to avoid costly mistakes, especially where IT is concerned, but it’s all opportunity.

And this stage, the business owner is now becoming more removed from the day to day operational tasks on the shop floor. This can be a very uncomfortable feeling in one or two ways. Firstly, the owner may want that hands-on role and not relinquish that part. It could be that the business is now at the stage where the owner is stopping it from growing, the entrepreneurial side is restricted as they are tied to the business. There a number of factors and variables in play, and having the right people is key, being a good leader is fundamental (at all stages).

SME £5m to £10m

£10m upwards

Financial Audits are required at this point (although some companies can be exempt if they satisfy certain criteria), so businesses need to be aware of the UK Audit requirements. Similar issues and opportunities still arise, but on a grander scale. Organisational structures are still fundamental, we might now start to see the need for Middle Management. We may also be looking to diversify into new markets, take on bigger orders, and higher volume. From £5m and up, some of your customers may not be the ones you want to deal with now, the one-off, low volume, job shop may not be your ideal customer. You might be seeing more of a need for Product Flow and Cells (Lean Manufacturing is a must from when you first start up), competition is high so you cannot stand still, even if your decision is to stay at a certain level. You will need to be driving for improvements to maintain the status quo, and your service has to be exceptional. Collaboration with a network of Manufacturers and or Partners, in my opinion, is key in this new world, and can bring some fantastic opportunities for growth. Again, IT infrastructure comes into play as the business is getting bigger: more employees, management leadership. The addition of new premises or additional buildings on the same industrial estate (this is where having a world class logistics operations pays dividends in not impacting your efficiency/productivity). The opportunities may now open up bringing the out-sourced services back in house, Sales and Human Resources, etc. At this level, you are likely to be making informed decisions based around data. Strategy alignment throughout the organisation is required, communicated and disseminated so everyone in the organisation knows the direction the company is going in and what the priorities are.

SME £10m upwards

Every business is different. One business’s pinch point may be at £3.5m another’s £7.5m but there will be very similar decisions to be made, but at this level the advantage is that businesses are likely to be able to make these decisions in a more informed way through data. Companies may not achieve sustained profitable growth unless they draft in the specialist skills required at the right time for the business. It’s the maxim that we don’t know what we don’t know. And the best advice is to seek advice from the experts in order to shift the dial in the right direction. This is something we can certainly help with, just contact the number below.

Ask yourself:

How much will it cost you not to resolve the issues that you are currently facing now or in the immediate future? How much will it cost you not to eliminate that pain? What are the lost opportunities on not taking your business to the next level or indeed keeping it at the level you want?

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Automation – Don’t shy away from it.

Posted on by Adam Payne

Automation has been around for years in many different forms within manufacturing, it’s not new.

In my early days as a Kaizen Engineer with McKechnie Plc (mid 90’s) I remember purchasing machines with the ability to auto eject or unload parts when the cycle had finished ( a Lean terminology called Hanedashi). A Hanedashi device saves associate time on a production cycle by ejecting a finished part from a machine, allowing the associate bringing the next part to load the new part into the machine without having to remove the old one.

Hanedashi - Auto Eject

This device enabled the set up of Single piece flow production lines, known as Chaku Chaku Lines in the Lean terminology which means Load, Load. With these Load Load Lines, all of the machines needed to make a product are located together in a “cell.” Any part of the work that can be automated is automated. As per our Hanedashi example previously, loading a part into a machine may require getting the orientation correct, properly seating the part in a jig, and clamping it into place. This requires a human skill. However, when the machine finishes it can just release the clamp and eject the part in a fully automated process. That’s how Chaku Chaku got its name. The associate only loads the machine, and never unloads it.

Single Piece Flow - Chaku Chaku

Now we’ll introduce Jidoka into the equation, as we probably all know Jidoka is one of the two pillars of the Toyota Production System along with just-in-time. Jidoka translates to “Autonomation” or “Automation with a Human Intelligence”. Autonomation highlights the causes of problems because work stops immediately when a problem first occurs. This leads to improvements in the processes that build in quality by eliminating the root causes of defects. Autonomation gives equipment the ability to distinguish good parts from bad autonomously, without being monitored by an associate.

jidoka - autnomation

The benefits of Load Load Lines and Autonomation are significant. They include the elimination of work in progress, defect free production, and leads to large productivity gains because an associate can handle several machines, termed multi-process handling.

Now with Automation and the principles discussed above we can get very creative, I mentioned working at McKechnie Plc in mid 90’s along with a great friend of mine Wayne Pimblett, Wayne was recruited as Team Leader for a cell not so creatively named Cell 7. The cell manufactured Fasteners. The traditional route was something like, Header Machine, Turn, Centreless Grind, Fillet Roll and then Thread Roll and would pass through various machining departments as batches, across roads into different units, you can imagine the waste.

Now, Cell 7 brought all of the principles we discussed earlier together, single piece flow, Load Load Lines, Ah! I must stop here, because we actually had the cell completely autonomous so the load was automated and the movement of parts between machines, so in essence all we needed to do was bowl feed the fasteners into the start of the process and the line did everything else. With the aid of Visual cameras for in process quality inspection – Autonomation, pick and place loading/unloading, auto eject of bad parts, etc the only interaction required was machine consumables, tooling change and obviously if anything drastic happened.

AUTOMATION mixed with some creative thinking and Lean Principles can have massive benefits to your business.

Automation should not be shied away from, but you do need to know the impact, benefit, justification for your business, so do the analysis. My opinion on the this is if we have 95% Non-Value Added Waste in the surrounding processes and we concentrate on the 5% Value Add in loading/unloading a cycle our focus and cost is miss-spent. It may look fantastic but you have far more opportunity to increase productivity, reduce costs, etc outside of the cycle. Which again could be through Automation, but do the analysis.

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Get your Changeovers out of the Slow Lane

Posted on by Adam Payne

Benefits of SMED  (Single minute exchange of dies)

  • WIP and lot size reduction.
  • Finished goods inventory reduction.
  • Improved machine/resource utilisation.

Whether you are high volume or low volume business, changeovers is one of those things that can sap the living life out of your manufacturing process.

An unstructured/wasteful approach to changeovers (SMED, set-up, etc) has the uncanny ability to grow arms and legs, and those arms and legs can even grow arms and legs.

I first witnessed a set up reduction back in the early 90’s as a Kaizen Engineer manufacturing Aerospace Fasteners, we were being trained by a Japanese sensei in Lean Manufacturing, running three events on different machines; a centreless grinder; a header machine and thread roller.

Our team had the header machine, we videoed the actual set up so we could observe the waste within the process, much to our surprise there was 8 hours of it????? A WHOLE SHIFT WORTH OF CHANGEOVER for a production run that would probably last no more than 30/60mins depending on batch size, and batch size we were talking thousands. It was running three shifts.

Now bearing in mind, a major customer had flagged this as an high risk to their operation due to capacity and were forcing discussions on us purchasing another machine?????

At the start of the week, we we’re thinking a 50% reduction would be excellent, never in a million years did we think we’d get to sub 30mins, but we did!

Long Changeovers drive so much waste within your business, WIP, Overproduction, delays, waiting, transportation…..so they need to be focussed on.

The main benefits are as shown

Key Principle of SMED

INTERNAL SET UP

Internal set up activities can only be performed when the process is stopped and must be kept to the absolute minimum in number and time taken to complete. Internal set-up activities should be limited to the actual fitting or removing of the Tool or Die or Material ONLY.

EXTERNAL SET UP

External set up activity can be performed with the process running and therefor does not affect the core changeover time.

As many changeover activities as possible should be external, leaving as few as possible as internal activities.

The statement that always sticks in my mind from my early SMED activities is ELIMINATE, COMBINE, SIMPLIFY.

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The Productivity Puzzle and Lean

Posted on by Adam Payne

I’ve never been one to shout about Lean, Six Sigma or Theory of Constraints, to individuals to solve a solution. I personally have though, applied the tools and techniques to resolve a situation or gain an opportunity I have faced. Granted, it’s not just about the application of tools and techniques, it’s equally important to focus on People, Culture and Managing Change within today’s organisations and society. Every single person has touched or been a part of a Lean process, within our everyday life from grocery shopping to our work we will have been in contact with lean in motion.

The interesting thing I have noticed recently are the articles beginning to appear regarding “is Lean at a crossroads?” and “How Lean is perceived today” particularly in the UK (but perhaps globally). An article by Morpheus Group stated “Businesses are taking a much more pragmatic approach, using a blend of tools….with very few businesses labeling their Corporate Programmes as Lean”.

It does seem that Lean and other Japanese terms associated with it are perceived a risk to alienating the workforce. I wonder why? Are we that uncomfortable with something that is not invented by us?? Are we hiding behind the terms as an excuse not to change??? (There is no doubting it is hard to implement and sustain, but that should never be an excuse). When I personally think about these questions it’s never been about the wording (don’t get me wrong I do cringe with some of them) but it’s about the application, execution/implementation that is key and the right behaviours that drive it so that we can benefit from it.

Businesses are placing a lot of importance on Strategic Cost Saving and Quality. This is absolutely fundamental in “Change” for any business. Strategy and Performance Management, Policy Deployment, Hoshin Kanri, whatever you choose to call it, is the back bone of your business, it is how you do business.

I believe Business Improvement is more important today than it ever has been with the globalisation of markets. What is it that gives us the competitive edge? In particular UK Productivity remains below pre-recession levels. I have been in discussion groups where an estimated 40% of productivity is lost through non value added activities, an estimated £3 Billion cost. Something Lean, Six Sigma, TOC can certainly impact.

This debate will carry on and involves so much from skills, impact on society, etc., etc.

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How Good is Your Factory? Are there Opportunities?

Posted on by Adam Payne

It’s easy to feel like a factory tour is something that happens once every couple years, but in reality it’s something that should happen every day.

When you walk your factory floors there are nine items to get an accurate first impression of how lean you are.

1. Work Stations?
Are they clean, organised, free from unnecessary material and equipment?
Are tools organized, identified and easy to find?
(Are 5S’s in place? Visual labeling? Is the factory well lit? Is equipment clean? Supervision and support personnel on shop floor? Metal on metal contact? Safety hazards? Debris on the floors? Check out the bathroom cleanliness.)

2. How many Monuments do you see?
Monuments are massive machines anchored to the deck, not easily moved to which material has to be delivered to, can cause issues with the flow of product (lack of flexibility)
Are they still in use? Not to be confused with age, often older machines are purpose built and give us flexibility in cellular manufacturing. Can machinery, material locations, drop offs be easily rearranged?

3.Work in Process?
Are there piles and piles of Work in Process (WIP)? Has some of it grown roots, celebrated its 1st, 2nd even 3rd birthdays? Does it have any paperwork? Do you have HOT items?
In the ideal factory you should only have the WIP you are working on and its classed as Standard in Process Stock (SIPS) in my eyes as it is controlled.

4. Can everyone see if they are on Target or Behind Schedule?
Hour by hour monitoring, or close to real time as you can get. Can you see the Abnormal from Normal? Use Red and Green to distinguish. Is abnormal recorded for root cause corrective action?

5. What other Metrics do your teams have?
What charts, graphs, objectives, are posted in the area? Are they a Standard Document? (revision controlled, time and date stamped)
Are the Metrics up to date, reviewed, actioned? Again are they on Target? Can you see the Abnormal from Normal easily?

6. Are Materials delivered to or stacked at the Point of Use?
If a worker loses a component (screw, nut, rivet) do they have to go to the stockroom? Ask yourself how are items replenished? Does the replenishment depend on a crane or forklift?

7. Does the Product Flow?
Through a cell, moving line or in large batches or lots? Are associates close together, can they talk to one another, see one another’s WIP, do they help each other out if something goes wrong?

8. Look at the Testing and Inspection?
Where is the Product inspected and tested? Do the associates do most of the inspections or does the product move to another area? Do you have large numbers of inspectors? What is your inspection backlog? Are your defects recorded, reviewed actioned? Are they reducing?

9. Ask! Talk! Communicate! Question!
The biggest and most important. Show dignity and respect at all times, question and challenge, talk to the people on the front line and ask why? Understand? Use your senses.
This list is not definitive and its definitely not just for manufacturing, you apply to all functions, businesses, sectors, industries. Now Go Look See!

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