The Productivity Puzzle and Lean

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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Improving Performance – Engineering Company Case Study

Increased Delivery, Increased Sales

**No images or Business Name as Customer NDA in place**

Opportunity

This Private Equity owned business was under performing against budget. Particular attention was required within the operational areas with Productivity and On Time Delivery drifting.

The Managing Director required a system to: communicate the strategy, allocate resources, focus and align actions, and control business drift. He wanted to ensure that all key improvement activities had ownership, responsibility, accountability and the relevant training and practitioner support required to increase overall company performance.

Improvement

Working with the Managing Director & Executive Team the decision of implementing Strategy Deployment and A3 Problem Solving was agreed along with hands-on project execution support.

Training was given to all Management and Leaders in what Policy Deployment and A3 Problem Solving is, what benefits and how the process should be structured to enable execution of the business objectives. Key fundamentals were as follows:

  • Identify the few, long term breakthrough objectives that are critical to long term success of the company.
  • Link these objectives with specific action plans throughout the organisation.
  • Focus and align the company’s internal organisations to achieve these long-term objectives.
  • Turn the strategic plan into a year – over – year action plan.
  • Coaches and Mentors others

Workshops were held to ascertain the critical improvement activities to be focused on within the business. Training and Coaching was given to the owners of each A3 Plan on how to manage and communicate through the A3 process. Guidance and training to understand background, current state, problem definition, analysis, actions and follow up.

Management Control Rooms were introduced with regular performance reviews held with all owners and stakeholders present. Ongoing coaching and mentoring in Management Behaviour for the process along with business improvement training and our Lean Coaching Programme to ensure execution and sustainability. Operational Excellence and Process Optimisation workshops/projects were completed covering Sales, Purchasing & Logistics, Operations and Planning.

The company significantly impacted it’s financial position over a 9 month period,

  • Increasing Sales by 20%
  • Delivery by 33%
  • Efficiency by 28%.

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