"Let It Rip"

Nancy Woodward

HR Magazine

September 2005, pp. 65-68

The author of this article argues that management communication to employees must be ongoing and honest, no matter how unpleasant or difficult the topic (such as imminent layoffs, etc.).

Keeping workers in the information loop is seen as essential to maintaining employees' trust. A recent study by consulting firm Towers Perrin, mentioned in the article, found that only 51 percent of employees felt that their companies generally tell employees the truth. Sixty percent felt that their companies communicated more honestly with shareholders than with employees. Fifty-five percent felt that their company worked too hard trying to "spin" the story. Almost half of employees believe they get more credible information from their immediate supervisor than from their CEO.

Honeywell has learned the following lessons from employee communication task groups:

• Make sure there is information for all employees
• Keep educational workshops short and to the point
• Don't make your workshops mandatory
• Use outside experts to make your point
• Anticipate the unusual question

The article also provides a discussion of the communication process at Hewlett-Packard. The company has created detailed, ongoing strategic plans around communication. A recent announcement of layoffs went quite smoothly because of this planning and infrastructure. The company uses its intranet as a regular conduit for communication. There is also a policy that an email to any manager, including the CEO, must be personally responded to within 5 days.

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"Valuable Building Blocks"

Doug Wilson and Mike Kochis

Industrial Engineer

July 2005, pp. 40-44

Medrad Inc. is a 2003 Baldrige Award-winning manufacturer of medical devices and services. When Medrad purchased a new facility, they took the opportunity to improve their old manufacturing processes by adopting lean principles that they dubbed MedFlow. A cross-functional team from manufacturing engineering, quality, and production was formed to learn about Lean and apply its principles. The team used value stream mapping, created visual work instructions, and implemented a kanban system. Two years later, a new team was formed to implement cellular manufacturing.

Some of the results from MedFlow were:

• An overall productivity increase of 30 percent
• Reduction of cycle times by 60 percent
• Reduced finished goods inventories by 50 percent
• Reduced floor space by 50 percent
• Reduced product defects and training time by 35 percent

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"6 Ways to Benefit from Customer Complaints"

Natalia Scriabina and Sergiy Fomichov

Quality Progress

September 2005, pp. 49-54

The authors of this article argue that the handling of customer complaints is a major area that can be a source of competitive advantage in the service market. They identify six practical approaches that can improve business performance through more effective complaint handling:

1. Handle complaints as opportunities—Complaints can be seen as "problems" or "opportunities". Labeling as a "problem" can lead to the complaint being viewed with defensiveness and blaming. Seeing a complaint as an "opportunity" allows the company to get maximum benefit from the feedback. The authors recommend that senior management endorse this attitude and make sure that all employees understand it.
2. Encourage customers to express dissatisfaction—Customers who do not complain often just go to competitors in the future. A dissatisfied customer often tells 10 or more other people about their negative experience. It costs 5-6 times more to attract new customers than to keep old ones...However, 90 percent of customers whose complaints are effectively resolved do not defect. Therefore, it is very cost-effective to state publicly that complaints are welcome, to publicize information on how to complain, and to make it as easy as possible to lodge a complaint.
3. Consider the customer's perspective—The complaint-handling process should focus on customers' needs. Some ways to do this are to acknowledge complaints; give complainants a timeframe for response and keep them informed; do not charge or penalize the complainant; use plain language, and provide for multiple languages or customer special needs (such as disabilities).
4. Establish documentation and maintain records—Documented policies and procedures have been shown to reduce errors by 48% and improve performance by 37%.
5. Train employees—Managers must be trained to develop effective complaint handling policies and procedures. Customer staff must be trained in how to effectively use complaint handling procedures.
6. Adhere to world-class best practices—Included in the ISO standards is a standard titled "Quality Management-Customer Satisfaction-Guidelines for Complaints Handling in Organizations".

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"Does Six Sigma Work in Service Organizations?"

Fred Patton

Quality Progress

September 2005, pp. 55-60

Six Sigma is beginning to take hold in service organizations. Two prominent practitioners are Home Depot and GE Capital. Both organizations have a link to General Electric and its Six Sigma effort, as the CEO of Home Depot formerly worked at General Electric. Another organization that has invested heavily in Six Sigma is Bank of America.

The author argues that "The majority of practices and methodologies used in Six Sigma are every bit as applicable to service organizations as manufacturing. By focusing on process improvement, the use of the DMAIC model and many of the more relevant tools such as VOC [Voice of the Customer], QFD, value added flow charting, process measurement and root cause analysis, Six Sigma can be usefully and easily adopted by service industries."

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"Sailing the Seven C's"

Richard Crandall and Betty Coffey

Industrial Engineer

August 2005, pp. 35-39

This article explores seven phases the authors feel a company must go through to move from batch production to a lean and agile approach:

1. Commitment—"This commitment requires top management support and implies participation, funding for resources, and recognition for accomplishments";
2. Concept—"A program concept is an understanding of what to do, what to accomplish, who will be responsible, and when it will be completed. The concept should be a big-picture view of the program that provides a direction and scope for those who will participate in the design and implementation process";
3. Configuration—"This phase involves the physical changes necessary in the administrative, manufacturing, and distribution processes. While these visible changes may be relatively straightforward, they can cost significant amounts of money and time";
4. Communication—"This phase involves designing and implementing the data exchange systems needed to achieve instantaneous data transfer, both within the company and among companies in the supply chain";
5. Culture—Changing the culture "requires an understanding of human relations and a willingness and ability to make major changes in individual thinking and team actions";
6. Coordination—Coordination "suggests that companies understand what their suppliers or customers want and need and what each participant should do to help achieve the objectives";
7. Collaboration—"Collaboration implies a greater level of interconnectivity between customer and supplier. Collaboration involves freely sharing information and working together to develop a more meaningful plan for the flow of both information and goods through the supply chain."

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"Lean at NUMMI"

Patrick Waurzyniak

Manufacturing Engineering

September 2005, pp. 73-84

It is now more than 20 years since the Toyota/GM joint venture (New United Motor Manufacturing Inc. or NUMMI) brought the Toyota Production System to Fremont, California. Some of the original workforce has retired, and NUMMI has re-dedicated its efforts in lean manufacturing over the past few years.

One of the newer Toyota Production System approaches implemented at NUMMI is jishuken activities: "Jishuken is when you give a very challenging project to a person or group of people and they work on it in a very short period of time-four or five days...You work on improving uptime or quality, reducing scrap, or reducing the number of defects that are coming out of the plant. They work 12-15, even 18 hours a day, doing the work."

Another approach being used is called Set Parts Supply or SPS: "Set Parts Supply is where we work on eliminating line-side parts...The idea is to have the right part at the disposal of the operator, at the right time."

An all-new training building is being completed on the plant site this fall. All 4800 team members working at the plant will receive Lean training activities in the training building each year.

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Meeting our Goals

John McNeil, GP Deltapoint
 

If the pinnacle of Operational Excellence is a smooth implementation of Lean in less than two years at Medrad, then the core of the mountain is the application and evolution of systems and processes to support such a change. Woodward's article on communications and Scriabina's article on dealing constructively with customer "opportunities" are clear examples of such systems. They include concepts such as Six Sigma analysis, quality systems, maintenance programs, process mapping and flow, and even Jishuken.

At the foot of this allegorical mountain lie the simple, trivial support mechanisms that lubricate change. Crandall's Cs is a comprehensive list. In GP Deltapoint's work we find that even these are not sufficiently detailed ideas for many organizations beginning an improvement journey. Even more fundamental (maybe under the mountain!) are such Hows as goal deployment, core soft skills and meeting management.

A wag has estimated that over 73 million meetings are conducted around the world each day. A Wharton Center study found that senior executives average 23 hours a week in meetings; middle managers average about half that. Only slightly more than 50 percent of the meetings are productive. We concur: many meetings should never have been held. Meetings to gather information that should have been gathered by reading or listening to customers are not legitimate. Meetings to disseminate information that others should have found by reading or listening are not legitimate. Neither are those for digesting information or getting others to develop your opinion on critical matters. Or those for ducking responsibility by participating in group think.

Legitimate meetings plan a project or move it forward. They have a goal, a facilitator who subordinates their opinions to the progress of meeting, a means of decision making and a process for creating action items and following up (5W1H or 5W2H for example). Of course they start and end on time, at which point you may look back, and discover that you have moved a mountain.

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