Operations Management

Creating a Culture of Continuous Improvement

Recently, we met with a new client and discussed previously completed projects.  He said, “yeah, we worked on this issue a couple of years ago, but here we are again, [and production is] down for the same problem.”  The root cause of this production failure could have been prevented.  Prior to the failure a Lean/Six Sigma project was initiated by an employee who created a potentially good solution.  When the project was completed, implementing the process change and behaviors on the production floor were unchanged.  Management applauded the effort but the change never became a sustainable solution.

Continuous Improvement is challenging, especially when change is not followed-up or acted upon.  When improvement is considered finished and not sustained, the improvement ceases being continuous.  Continuous Improvement is not a continual line of discrete process improvement projects; it is ensuring change becomes a new standard in how things are done within the organization.

Sometimes follow-up activity is the responsibility of a Quality Assurance person or a Continuous Improvement Engineer, who can answer questions and make the necessary changes because of problems that weren’t revealed in the project.  However, change and improvement doesn’t really become effective until the reinforcement of modified behavior is part of a daily routine, for both the management team and the employees.  Once management establishes an expectation, which was derived from a revised process, it is important employee behaviors are modified.  The effective adoption of a changed process will become the accepted standard.

A Lean Culture, or a Culture of Continuous Improvement becomes highly effective when both the management team and the employees are working on improvement concurrently.  When improvement becomes part of your culture it is a common expectation and everyone is an agent of change.  Management is no longer concerned with administering change because it is a valued element of an organization’s identity; people are problem solving and working on the next issue.  The need to manage change becomes a minimal effort because systems and behaviors encourage improvement and problem solving.

Toyota says, when there is no problem, then that is a problem.  For them, there is a “healthy sense of paranoia” that always says that there is something left to improve.

Posted by ProSolve in Industrial Engineering, Lean, News & Events, Operations Management, Productivity
Using Productivity Practices During Downtimes

Using Productivity Practices During Downtimes

PROSOLVE’S PRESIDENT OFFERS ADVICE TO IMPACTED ENERGY INDUSTRY COMPANIES

Organizations feeling the impact from the recent energy industry downturn can use this time to their advantage.

“The best time to make operational changes are during the slow times,” says David Hall, P. Eng, President of ProSolve Consulting. “Now that projects are being put on hold and offices are slowing down, this is a good time to reflect on how to improve the efficiency of operations, reduce costs when it is most valuable, without layoffs, and prepare for even greater profits when the industry starts to recover.”

Hall says organizations can do several things during this downtime to better position themselves in the future:

  1. Revise strategic plans
    1. Reduce your risks by making more effective use of existing resources and assets.
    2. Review expenditures and consider timing: Is this the right time to buy that new equipment? What other options do you have? Consider application of Productivity Principles to draw the most value from your existing resources. Returns can be achieved in weeks, which makes you more nimble to attack new opportunities.
    3. Review labour requirements: Do you reduce staff and run the risk of losing exceptional talent? Consider the people you have to get the current work done as well as to review current processes, document best practices and increase training to enhance manufacturing capability, system quality, and reduce waste.
    4. How much has your company invested in hiring and training people? You risk losing that investment if people are laid off. Consider how much it will cost you to replace and train new people when industry eventually recovers. Develop people to their full potential.
  1. Review working capital
    1. Consider your supply chain, current inventory levels, and purchasing plans in light of your lower revenue expectations. What can you return to vendors or sell at a reduced price while there is still demand, to return working capital back into cash?
    2. What commitments have you made to suppliers? Is there an opportunity to reduce the size of deliveries, and implement just-in-time strategies to match the timing of payments to the timing of collections from your customers? Your suppliers are as concerned as you are about the changing business environment. Partner with your suppliers and build trust so that you can rely on their support during slow periods.
    3. Consider where and how you store your inventory. Do you have a warehouse lease or agreement coming up that you can renegotiate in favour of leasing a smaller footprint? Effective inventory management can dramatically reduce operating expenses and reduce negative cash flow.
  1. Find new opportunities: We’ve all heard the expression “when a door closes, a window opens”. Consider thinking outside the box.
    1. Are there other markets into which you could sell your products?
    2. Are there other products your customers use that you could adapt and produce as well, using your existing capacity and infrastructure?
    3. What other products can you move through your distribution network?
    4. How else can you utilize your technology? What needs can your technology serve?
Posted by ProSolve in Lean, News Archives, Operations Management, Productivity
Get Lean in 2015

Get Lean in 2015

GET LEAN IN 2015 – SIX TIPS TO SHAPE UP YOUR ORGANIZATION

Most of us are no strangers to New Year’s resolutions. At this time of year, we look back on the past, and resolve to make productive and healthy changes for ourselves for the New Year. The most common personal New Year’s resolutions are to lose weight, stop excess consumption, spend more time with family, get out of debt, help others and enjoy life more. However, how many people apply the same personal resolutions to their organization?

Just as we have personal improvements we want or need to make, so do many organizations. By applying Lean principles, you can shape up your organization while working on those personal improvements.

Tip 1Improve your culture: In Lean, there are two main pillars. The first is Continuous Improvement. The second is Respect for People. Most Lean projects focus on Continuous Improvement, but this will not truly happen without a focus on people; your customers, your suppliers, and most importantly, your staff.

In order for Continuous Improvement to work, you need to create an atmosphere of continuous learning, where people are given the ability and freedom to challenge the status quo, and even encouraged to do so.

In 2015, encourage your staff to make suggestions on how to improve their work on a regular basis. This could be anything from getting another hand tool so there is one at each workbench, or providing training on the scheduling software to improve its use. The most important part though, is to actually implement some of the suggestions.

Tip 2Lose some “weight”: Organizations that have not implemented Lean may not recognize or be able to quantify how much waste they have in their system. You may be surprised to find as little as 10% of your organization’s time is actually spent on value-added activities.

Pick a process in your organization and look for one of the eight wastes. Once you have identified a waste, brainstorm ideas with your staff on how that waste can be reduced. Here are some questions you can ask:

  • Do you have material handling equipment moving pallets of parts between workstations?
  • Is there a lot of work-in-progress?
  • Do staff members have the tools they need when they need them?
  • Is equipment sitting idle?
  • Are four different signatures required on an order?
  • Do you create reports that no one actually reads?
  • Do staff members spend time fixing errors that others have made?
  • Are skilled staff members being used to their full potential?

 

Be moTip 3re “takt”-ful: Takt time is a common term in Lean. It is the pace at which production needs to work to keep up with customer demand. By examining your customer demand, you can determine your organization’s takt time then work to balance the work so each step in the process is close to takt. This, in combination with waste elimination, will reduce the lead time of your process. Full Lean implementation can result in a 25 to 50% reduction in lead-time, which ultimately increases your customer responsiveness. 

Tip 4Don’t make the same mistakes: Everyone knows the saying “learn from your mistakes,” but we often don’t do this in our organizations. Many times, if a defect is found in a product, or a mistake is made in shipping, the problem is corrected and everyone moves on. Next time, rather than re-soldering that part (for example), challenge yourself and your team to examine the cause for the faulty solder. Was the flux missed? Is the soldering iron too small or not properly cleaned? Is appropriate training in place? You can use tools like “5 Whys” and fishbone diagrams to really dig into the root cause of the problem. By doing so, you can work on preventing the same mistake from happening again rather than just applying a Band-Aid. 

Tip 5Drive less: Material handling equipment and inventory racking are an important part of many operations. However, once material is moved onto the assembly or manufacturing floor, the focus of Lean is to provide each workstation with the supplies they need as they need them. This often means moving raw material, parts and work-in-progress between workstations in smaller batches, and therefore on a cart instead of with the forklift. When Lean is fully implemented in a manufacturing organization, the company can expect material handling savings on the order of 25 to 50%. 

Tip 6Clear the clutter: Are there items in your workspace that you have never used? This can happen on the shop floor with tools or manuals for equipment that has long been discarded, as well as in offices with out-dated procedures, or keeping around that broken chair that might one day get fixed. You will find many things that are being kept “just in case.” The New Year is a perfect time to conduct a “red-tagging” exercise. Go through your workspace and place a red-tag on anything that you haven’t used or opened in one year. Once complete, place all of the red-tagged items in a designated space. If no one claims them in 90 days, they will be discarded or donated – just in time for “spring cleaning.”

Just like cutting out that second cookie as part of your healthy eating New Year’s resolution, a simple modification in your organization can lead to vast differences to your productivity and bottom line. So, while you’re making your personal resolutions list this holiday season, don’t forget you can also improve your organization by going Lean in 2015.

If you’d like more information on how your organization can be more Lean in 2015, the ProSolve team is here to help. One of our consultants would be happy to provide you with some additional information. Contact us via email info@prosolve.ca, or phone us at 780.414.1895.

Posted by ProSolve in Industrial Engineering, Lean, News Archives, Operations Management, Productivity