"How Human Resource Departments Can Help Lean Transformation"

Monica Tracey and Jamie Flinchbaugh

Target

2006, Third Issue, pp. 5-10 (available online at www.ame.org)

The authors of this article conducted a survey of 72 managers and 154 non-supervisory employees at 72 different sites. Five key variables predicted successful lean implementation:

• Development of teams as a supporting structure—Teams need both the capability and the skills to manage themselves. There should be high agreement about how the work should be done. They should employ common language, principles, and tools. They should agree on vision, metrics, and goals.
• Calculation and communication of metrics—The metrics of a scoreboard should be owned by the team. Metrics should support daily decision making. Management must support the metrics. The metrics must "point in a steady and consistent direction toward the ideal state."
• Communication across boundaries—Communication must be vertical, horizontal, and two-way. Functional boundaries should not get in the way of the most efficient and effective communication for the customer.
• Communication to employees regarding their role—Roles change dramatically in lean organizations. Management must communicate clearly about these roles, and employees must learn how to ask questions and elicit feedback about their roles.
• Acknowledgement and celebrations of successes—Since lean is a never-ending journey, "...leadership must balance recognition of the success achieved with maintaining the tension for future progress." Tangible rewards may be difficult to administer, and the authors of this article feel that the best reward may be listening to and acting upon people's ideas.

The authors provide the following recommendations for HR departments of Lean organizations:

• Create a lean culture to address the five predictors above
• Recruit the character traits needed for the above five predictors
• Create a reward structure considered fair by the employees
• Develop, choose, and maintain "Lean" leaders

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"How Right Should the Customer Be?"

Eric Anderson and Vincent Onyemah

Harvard Business Review

July 2006, pp. 59-67

This article contrasts two prototypical cultures for approaches to managing an organization's sales force. Depending on the situation, one may be more effective than the other. Outcome control (OC) systems put the customer first. Behavior Control (BC) systems put the district or regional manager first. The key contrasts are:

• In OC systems, managers focus attention on bottom line results, while in BC systems, mangers focus on the methods and processes used to achieve outcomes
• In OC systems, salesperson performance is evaluated primarily by metrics controlled by the customer (especially sales) while in BC systems management uses more subjective criteria set by management
• In OC systems, managers provide relatively little supervision and salespeople make decisions while in BC systems managers provide heavy supervision and make the decisions
• In OC systems, there is little or no contact between managers and salespeople while in BC systems there is frequent and extensive contact
• In OC systems, sales staff are rarely monitored by management while in BC systems they are constantly monitored
• In OC systems, there is little or no coaching from managers while in BC systems there is a lot of coaching
• In OC systems, compensation is mostly variable, depending on results, while in BC systems compensation is keyed to salary and management evaluations

OC systems are called for when

• Customers need a lot of information
• Sales results are less predictable
• There are many ways to close the deal
• There is an excellent accounting system

BC systems are called for when

• Your salespeople lack experience
• You need to protect your brand
• You have high non-sales priorities such as participating in new product development
• It is difficult to assign credit for who exactly made the sale

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"Steelcase: Learning How to Implement Customer-Focused Enterprise-Wide Lean"

Lea Tonkin

Target

2006, Third Issue, pp. 35-42 (available online at www.ame.org)

This case study shows how highly-respected Steelcase extended its Lean activities to office areas.

Four senior executives who report to the CEO comprise the "Lean Action Committee" (LAC). Their consistent involvement and commitment signals that this is not a program of the month.

High-potential people are chosen to act as the Office Lean Consulting team. These people are pulled completely out of their normal organizational roles for a year.

There is a VP-level process sponsor for each administrative area targeted for a lean project. A value-stream manager upstream or down stream of the project area helps the project to completion. A VP from the Finance area provides support. Major progress checks help keep things on track.

Some suggestions and lessons learned are:

• Start small and pilot changes before implementing them in day-to-day production
• When consolidating a process, don't build too many steps into one person
• Keep communications as open as possible
• Value Stream Mapping and Lean training should be completed before attempting implementation
• Address reluctance to change directly
• Be patient, because the language of the office is different from the language of the manufacturing floor
• There should be clear ownership of the process and clear metrics
• Build experience and understanding with hands-on activities
• Build in milestones along the way

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"Building a Vigorous Working Culture"

Robert W. Hall

Target

2005, Third Issue pp. 17-26 (available online at www.ame.org)

This article uses Toyota Motor Company and Webster Plastics (a small, specialty plastic molder located near Rochester, NY) to illustrate the importance of work culture in the success of lean manufacturing organizations. Four different working culture classifications (from a "lean" perspective) are identified in the article:

• "Business-as-usual"—defined as financially-directed project-by-project process change.
• "Proficient" (Structured Flow Operations)—Core operations are integrated. Improvement is directed. New Product Development is project-structured, with cross-functional collaboration on projects. There is "good" customer service, cost, quality, delivery, and corporate citizenship.
• "Vigorous" (Habitually Learning)—Autonomous improvement and process learning are embedded in the work culture. Everyone is involved in New Product Development and rigorously learns all base technology. The organization is very focused on customer needs, is attentive to the external environment, and balances all stakeholder needs.
• "Enduring" (Change Resilient)—Mastery of process improvement eliminates waste from all-new processes very quickly. The organization is able to adopt new business models or transform its industry. The unifying social mission serves all stakeholders well.

The author argues that it is a difficult cultural jump between "Proficient" organizations that are trying out the techniques of Lean and "Vigorous" organizations that have Lean as a part of their living work culture. The following comparisons are provided:

• "Proficient" Lean conversion has more explicit training and is staff-directed vs. more tacit learning by seeing, absorbing, and doing in "Vigorous" Lean conversion
• "Proficient" Lean organizations implement the techniques vs. "Vigorous" use the techniques to develop people
• "Proficient" develop a work culture to use techniques vs. "Vigorous" mentor people developing themselves and use the techniques to improve processes
• "Proficient" have sporadic process improvement, more as projects by empowered people vs. "Vigorous" have regular improvement through standardized work as a part of work
• "Proficient" have the staff write work instructions vs. "Vigorous" have work teams document work instructions as part of standardized work
• "Proficient" develop each process using the techniques vs. "Vigorous" develop people to see and overcome problems using the system

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"5S at Deceuninck North America's Monroe Site: Sustaining and Improving the Gains"

Cash Powell and Steve Hoekzema

Target

2005, Third Issue pp. 27-36 (available online at www.ame.org)

Deceuninck North America introduced the 5S approach to orderliness, cleanliness, and standardizing work areas in 1999. The English words "Sort, Simplify, Systematic Cleaning, Standardize, Sustain" represent the original five Japanese words "Seiri, Seiton, Seiso, Seiketsu, Shitsuke". From the beginning, management understood that the "Sustain" aspect would be crucial if the 5S approach was to have any lasting effect.

A full-time 5S facilitator was initially appointed for the 250-associate facility. The facilitator also acted as the auditor for 5S certification in the facility. Twenty-three out of 27 work areas are now 5S certified. After certification, there are three or four sustaining audits for each work area each year. Reports are sent to the departmental management group. Management comments on all area audits. Performance reviews include comments about the work area's 5S performance.

The shift in discipline and work culture from the 5S effort has spread to other arenas:

• The employees feel more empowered in general
• There has not been a lost time accident since 5S was introduced
• $3 million has been saved from less scrap and rework
• The accuracy of shipments has increased from 89.0 percent to 98.5 percent
• Productivity has improved 23 percent

The disciplined habits from the 5S program also helped expedite the implementation of a Total Productive Maintenance effort in 2004.

A valuable aspect of this article is that it provides a number of 5S audit sheets that could be adapted for use by other companies.

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Implementing Change with First Level Leaders

John McNeil, GP Deltapoint
 

When organizations embark on change initiatives, such as Hall's proficient to vigorous, Tonkin's office lean, or Tracey's transformations, they lean on First Level Leaders. Their titles vary from "foreman" in a steel mill to "regional manager" in a sales organization, but their positions remain the same: caught between the rock of worker inertia and the hard place of the organization's inexorable movement. In a modern organization, these folks are no longer super-executors of productive work, but coaches of those who do it. They are teachers and coaches, but first they must be taught and coached themselves; a task that is seldom done well.

At GP Deltapoint, when teaching First Level Leaders to drive change, we hew to basic principles. We try to minimize the use of massive PowerPoint decks. We keep training sessions short and close to the time and place of implementation. We use job aids extensively and teach to them. We keep handouts to a minimum and don't allow them to become a distraction or a crutch through the training sessions. We use the Socratic Method to ensure that participants develop answers themselves that are relevant to their experiences and situations. And whenever possible, we employ and deploy the proven methods of Training within Industry (TWI). After all, those methods form a key base of the Toyota Production System; the archetype of successful change implemented through supervisors.

TWI comprises three separate programs. Job Instruction teaches how to instruct employees so that they can quickly remember to do a job correctly and safely. Job Methods shows how to improve methods for producing greater quantities of quality products or services in less time by using people, machines and materials most effectively. It has spawned many of the lean tools such as Value Stream Mapping. Job Relations teaches us how to lead employees so that problems are prevented and analytical methods are used to resolve problems effectively. Taken together, these tools provide great insight into making change happen at the ground floor.

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