Identifying Value Streams
While we all understand how powerful value stream mapping can be, selecting a value stream to begin with can sometimes be a daunting and task. Along with exhausting brainstorming sessions, the effects of product flow can be quite deadly if the "spray and pray" approach is used. Here is a three-step approach for selecting a value stream to map that will put you in a much better position to establish a flow down the line.
1. Family Comes First:
The first step in the selection of a value stream is to group your products into families. A product family is a group of products that pass through similar processing steps and share common equipment prior to leaving your company (shipping to customer). The grouping of product families can be done using a product routing matrix like the one shown below. The left column shows your products/services and the top row lists all of the processes or pieces of equipment within your organization.
We then would go through each box and place a number in the box to show us the 1'st step, 2'nd step etc. X's can also be used too. After the products/services have been matched up with the appropriate process steps or machine centers a simple sort will reveal the initial product families. As you map your way through each value stream adjustments should be made.
2. Select your family:
Now that our families are grouped we can select the family that will provide the biggest impact for your business needs. This could be based on:
3. Look at the Gemba:
Once you have figured out where the biggest impact for your mapping efforts is, it's time to take a look at the Gemba. The gemba walk should be performed from a customer’s perspective, meaning you will observe the value stream from the customer and work your way upstream. It's important that you view the value stream with the following considerations:
In our next post on Listen to the Gemba we will look into some more important details that will help us to map the appropriate value stream and set our mapping efforts up to create an environment where products flow evenly down the stream.
Twas the night before Kaizen
Twas the night before kaizen when all through the value stream, not a value added activity was flowing not even engineering. Stickies were hung on the wall with great care, In hopes that Lean Strategies International would soon be there.
The teams thought of processes, visions and hoshin kanri while waste sat in the value stream acting quite ornery. Transportation, inventory and even some waiting... their work would be hard, but with ©Treat 1,2,3 in their toolbelt the waste was not so large. Somewhere in the process of examining, a constraint showed up. The team ran to the gemba to see what was up. They grabbed their cameras, glasses and measuring tape, only a moment would pass before they had their current state. With review and examination not far behind a future state was almost ready, the improvements close behind.
Those team members were passionate, lively and quick it became very obvious this was not St. Nick. More rapid than eagles they wrote up their action plan, they whistled and shouted while improvements began. "Now kanban! Now 5S! Now TPM and Standards! To the top of the metrics to the top of the charts." They improved like crazy while employees bought in. Shortly thereafter the transformation came to an end.
The plant stood there watching as the consultants walked out, not a word of a purchase order not a face with a pout. Certificates, belts and knowledge in hand this plant became another successful lean six sigma land. Shortly thereafter the events continued on, kaizen had begun and it was far from gone. With tools, methods and strategy held tight in their belt, the organization realized quickly Lean Strategies was there to help. The coaches turned with a smile and a tilt of their ear we all felt their good spirit and joyous holiday cheer. Whether Lean, Six Sigma or Kaizen, every strategy takes time for new culture and behavior to set in. But as the minutes turned to hours, organizations found solutions igniting their powers. As the new year approaches and strategy begins remember Lean Strategies will help you earn the wins. As we close out this holiday week and approach the new year we just want to wish a Happy holiday to each of you and a joyous New Year.
The House of Toyota
The house of Toyota is a perfect representation of a production system being linked together. Each pillar supporting the goals and the entire home resting its weight on a solid foundation. The model has been used for thousands of operating systems over the years and each time the house seems to do the trick more and more effectively. So, what does each of the elements of this house represent in an operating system?
Goals - First and foremost are the goals which are most often shown as the roof, which balances amongst the other elements.
Pillars - Next there are two pillars which balance and hold the goals up. One pillar represents the "just - in - time" while the other is commonly labeled Jidoka. The just-in-time system "supports" the idea that we should always deliver the right part, in the right amount at the absolute most perfect time. But of course, the goals (roof) would come crashing down without the support of quality. That is the Jidoka pillar that is shown on the right. Together quality and effective, efficient production give the goals a place to rest.
Foundation/Stability - So where do the pillars get their strength and support from? The base or foundation as it's often called in construction today represents stability in operations. There is one more element that is surprisingly left out of many models.
People/Culture -The last piece of the puzzle is people. Personally, I've always found the model quite fascinating.
When we stop, and reflect on the home it becomes quite evident that the entire system, organization, operating structure must work together. It is not just a set of tools but rather a culture, a foundation, walls that need maintaining and a roof that must continually be kept in mind. People must continually strive to maintain their home and patch, plaster or touch up pieces that may become damaged. Forget about any one piece of the home and over time it will decay. But if the house is watched over, worked on and regularly inspected it becomes a home that provides safety, shelter and the possibility of expansion.
Metrics in Lean Six Sigma
"What gets measured gets done!" That's the saying and we've all heard it before, but what exactly to measure is amongst the most critical questions we can answer in relation to our lean six sigma projects. Lean six sigma is a data driven approach of improvement. With that in mind the data that we choose to establish in our improvement projects must be measurable and aligned with project goals.
There are three general categories of metrics that almost any lean six sigma (CTx's) objective will fall under: Quality, Cost and Time. However, these metrics are quite broad inherently and can still leave us wondering how "improvement" is defined. Which brings us to the most important point of project development, defining up front what "improvement" means.
Before any project kicks off or mapping begins all parties associated should know exactly:
1. What measurements will be used.
2. How those measurements constitute a win.
3. Why those measurements constitute a win.
Defining what metrics will be used to play the game helps employees to stay aligned with objectives and ensure that both the team and the organization get the results they want.
Like the game of basketball teams also need to understand how their metrics constitute a win. For instance an employee with a goal of reducing defects could simply show a traditional yield measurement. Although this measurement may show reduced defects and an improved yield, it may not be exactly "what" the organization wants as traditional yield often creates a hidden factory scenario. For this reason, teams, should understand clearly "how" the measurements align with project goals.
The team who puts the ball in the hoop on any given day more times than their opponent is the winner. The reason why is that there is correlation between a team’s skill, conditioning and teamwork and the amount of points they score. Understanding why they want to score more points helps the morale, motivation and dedication of the team. Going back to our yield calculation example it becomes clear that using a first time yield or a rolled throughput yield is a much truer measurement than a traditional yield would be. After all, why would anybody want 100% yield if there were months of rework involved?
While we sometimes end up on the short end of the stick with projects because what, how and why aren't clearly laid out up front many organizations may find that the wins they wanted were much bigger than what they actually saw. Establishing upfront what, how and why the "game" is being scored the way it is makes it much easier for both the organization and the teams to end with a winning score that aligns with everyones needs.
The benefits of lean six sigma are widely known now throughout the world. With organizations, such as Motorola and GE leading the way, where do small businesses sit in terms of the strategic benefits seen by these giants? Simply put, the same benefits that have been realized by organizational giants are usually more applicable to smaller organizations. Why? Smaller organizations have less people and often do not stretch across global boundaries. This gives them the ability to train more people, move quicker and create results in lightning fast fashions.
Reducing capital expenses, increasing efficiency and minimizing variability are only a few of the benefits any sized company can realize by undertaking strategic implementation of lean six sigma. But there are many other benefits that we don't see right away:
Engaged and Confident Employees
Along with reduced capital expenses, waste and increased efficiency lean six sigma gives employees a means of using their talents in a positive way. Since every strategy requires effective execution of tactics there is no better way to drive improvements than through the people who are closest to the work. Those people are the individuals who produce products and services day in and day out. They are the ones who live at the gemba. That makes those individuals the perfect resources to tap into when looking to improve the efficiency and effectiveness of a process. As these employees begin to engage in kaizen events and develop their skills confidence grows within each of them. As confidence grows within employees and they begin to see, feel and realize their positive impact the benefits reach far beyond performance and accountability, in fact "they are life changing" as Bob Chapman once put it. As people become confident, motivated and realize their talents they often times continue to search out opportunities and engage in continuous improvement.
Stronger Economic Conditions
As the years go by it becomes more and more obvious that we need lean and six sigma if we are to survive in changing times. If not for the more obvious reasons of reduced waste and stable processes but for the reasons we don't always see right away.... What reasons can you think of?
A new year ahead.....
As the new year approaches we all have to wonder, what will happen with the economy? How will the United States respond with presidential changes and what will become of the unemployment rate? There is a lot to consider as the new year approaches and yet we do have to acknowledge this is not the worst of times. But where does lean and six sigma stand in these changing times?
Before we all start jumping off of the Lean or Six Sigma journey let's consider a few reasons why the lean six sigma organizations are so well equipped to have their biggest years just around the corner.
1. Knowing where you are headed - Most lean six sigma companies started their strategic planning by establishing a clear direction for your company. This is a huge advantage because you know where you want to be and can pivot if necessary to stay on course. Most companies that fail during economic shifts and downturns do not have stable processes in place and rely mostly on sales and marketing or reactive behaviors for their growth. The key advantage of knowing where you want to be or having a "future state" in mind is that you can consider both leading and lagging economic trends and plan accordingly. Lean organizations can be confident in knowing that with lower inventory, waste and strong flexible teams in place their profit margins will certainly be higher in both dowturns of the economy and upward swings.
2. The time to improve - Shifts in economy and "slow" times are even more of a reason to push the improvement journey. It's a well-known fact that the one asset that grows and appreciates with time is people. With that in mind we know that like every other business "shift" in history it will only be a matter of time before economic conditions "change" once more. When that happens the organizations who cross-trained, developed and invested in their people will have an enormous advantage over companies who laid off and let go.
3. Capital? - Stable organizations with less waste need less capital to operate efficiently. Using "times of change" to focus on improving the first three P's referenced in The Toyota Way supports the 4'th P. This type of long term thinking will leave you much better prepared for future changes that undoubtedly will come in time. Additionally, solving problems when you have
4. What gets measured, gets improved - Both Six Sigma and Lean use quantifiable measurements to track results. As times change it is much easier to develop effective, repeatable strategy for the future when you are tracking and gathering measurements already. Consider making this your focus in the new year, establishing metrics that can show the performance of the organization through the ups and downs of the economy. Remember keep the measurements simple. You don't need to gather scientific algorithms that can only be understood after years of study just track the basics: Lead time, Error rate, on time delivery to customer, on time delivery from vendor, Takt time, Improvements, Inventory turnover.
Change is bound to come; good or bad. Now is the time to focus on strengthen your business plan and build excitement around your company’s direction. The organizations who develop their people, relentlessly remove waste from processes and build a long-term mindset will be able to withstand the changes of time and grow stronger and stronger with each new year.
Click Here to Submit Your Post on Listen to the Gemba.