Medical Schools Need Greater Capacity

In a previous posting, I described the disconnect between supply and demand for doctors in the United States. That article noted that not enough doctors go to rural areas, and that some specialties go begging for doctors while others have too many applicants for available residencies.

I also mentioned a
commentary by a Harvard Medical School professor about the shortage of doctors. I didn’t describe it in detail, but his commentary noted that the Association of American Medical Colleges is requesting medical schools to increase enrollments by 30 percent over the next seven to 15 years.

Is there a shortage of doctors because not enough people want to become doctors? Or is it because medical schools lack the capacity to produce enough doctors?

A recent article in the Miami Herald (not available online) makes it clear that the problem is capacity, not supply.

The article notes that Florida International University will be opening a new medical school a year from now, with an initial class of 40 students. The university has already received more than 1,600 applicants from around the country for those 40 slots.

The article, written by Oscar Corral, also notes the bigger picture:

Traditionally, medical schools across the country are flooded with applicants every year and accept less than half of them.

In 2007, 42,315 people applied to medical schools in the United States and only 17,759 were accepted, according to the Association of American Medical Colleges.

I mention all this because increasing capacity is one of the biggest benefits that can be achieved through application of lean principles.

Of course, medical schools are not factories. And while I’m sure there are many opportunities to eliminate waste in school processes through lean techniques, that doesn’t necessarily translate into the kinds of capacity improvements that would occur in manufacturing.

Can a lean approach help increase capacity in a medical school? How would that be achieved? If anyone has experience that is relevant, please share it below.


Acting Like Big Brother Won’t Help Hospitals

Hospital infection rates are higher than they should be because many hospital workers don’t wash their hands as often as they should. That is well-established, and many hospitals involved in improvement efforts are focusing on improving the rate of hand-washing.

More than a year ago, I
discussed the issue of just how you get people to wash more often. I cited a blog post by Mark Graban, which included suggestions by author David Mann. Mann made the point that processes can be set up to change behavior, with approaches that include better education of employees, visual controls to instruct people and a process for allowing people to anonymously report offenders.

But not everyone understands that. I was disturbed by a recent
posting on The Wall Street Journal Health Blog about a company called Arrowsight. The firm is marketing a service to hospitals specifically designed to improve hand-washing rates, which it says “has worked in food processing and manufacturing plants.” The service: video surveillance.

In an earlier pilot, launched in January of 2007, the company says its hospital video auditing service boosted hand-hygiene compliance to 90% from 38% in three months. The improvement was durable, remaining above 90% for twelve months running…

While live auditors won’t be monitoring worker’s every move 24/7, the Arrowsight system is programmed to search huge volumes of video very efficiently. It’s smart enough to catch such triggers as a door opening to a hospital room to capture whether staffers washes their hands after entering.

If the compliance rate remained high for 12 months, that is only because employees know they are still being watched.

More importantly, video monitoring flies in the face of the lean principle of respect for people. It can only make workers suspicious and resentful, and hurt morale. And it certainly does not encourage anyone to be a creative, thinking employee who contributes improvement ideas.

I hope hospitals will resist this approach.


Wall Street Journal Misses the Boat on Business Advice

It is inevitable that, during tough economic times, you start seeing articles advising people and businesses how to save money.

There is nothing wrong with that. But as a lean advocate, when I look at advice for businesses, I become frustrated over what is missing.

Case in point: An article in The Wall Street Journal discussing recent increases in transportation expenses and ways companies can cut shipping costs.

The advice, offered by writer Diana Ransom, includes:
Obtain discounts by paying with business credit cards
Use electronic postage
Try fulfillment services that store inventory in other countries and can help avoid international shipping duties and customs fees
Use comparison websites to compare rates of shipping companies
Obtain discounts through membership in a business or trade organization
Time your shipments several days in advance to avoid last-minute or next-day charges
Consolidate deliveries
Negotiate with suppliers

What is wrong with this advice? Nothing, really, although I do have some concerns about the use of fulfillment services, which might undermine efforts to reduce inventory.

However, Ransom fails to suggest taking a lean approach by finding ways to improve the overall fulfillment process – which could be of great value.

Such an approach might include mapping the fulfillment process to identify opportunities for improvement, setting up a kanban system, and a variety of other actions.

I am not a supply chain expert, so I do not know what all those actions might be. I defer to people like James William Martin, author of Operational Excellence: Using Lean Six Sigma to Translate Customer Value through Global Supply Chains and Stephen Cimorelli, author of Kanban for the Supply Chain: Fundamental Practices for Manufacturing Management. (We publish a
large collection of books on kanban and supply chain issues.)

The main point is that when you are trying to save money in tough economic times, you should think about lean first.


We Need More Failure

I recently argued that the U.S. automakers shouldn’t get the $25 billion in loans they are seeking from the federal government. I suggested that if one of them actually went into bankruptcy, it wouldn’t be the worst thing in the world. And I suggested that times now are different from Chrysler was given a bailout 30 years ago. I didn’t question the value or the success of that bailout.

Maybe I should have. I read recently that some people believe the bailout was a bad idea, and that Chrysler should have been allowed to fail.

But wait a minute: Didn’t Chrysler become a stronger, more successful company as a result of the bailout? Yes. But one school of thought is that the bailout planted some of the seeds leading to the problems the industry has today. And if that is true, it may have implications for the current bailouts of Wall Street firms.

this, by columnist David Leonhardt of The New York Times:

You can draw a clear line from the Chrysler bailout to the recent attempts to steady Wall Street. Back then, Washington insisted on a few pounds of flesh, like a wage freeze for Chrysler workers, in exchange for aid. Mr. Paulson has done something similar by insisting that shareholders of the Wall Street firms benefit little from any bailout.

In 1979, the government structured the Chrysler deal so that taxpayers might earn a profit from it (which they did). This year, the Fed effectively purchased securities from Bear Stearns that it hopes to sell for a gain when the financial markets calm down. While it’s way too early to know if the strategy will succeed as well as it did three decades ago, it’s certainly conceivable.

But if you take a moment to think through the full Chrysler story, you start to realize that it’s setting a really low bar. The Chrysler bailout may have saved the company, but it did nothing, after all, to stop Detroit’s long, sad decline.

Barry Ritholtz — who runs an equity research firm in New York and writes
The Big Picture, one of the best-read economics blogs — is going to publish a book soon making the case that the bailout actually helped cause the decline. The book is called, “Bailout Nation.” In it, Mr. Ritholtz sketches out an intriguing alternative history of Chrysler and Detroit.

If Chrysler had collapsed, he argues, vulture investors might have swooped in and reconstituted the company as a smaller automaker less tied to the failed strategies of Detroit’s Big Three and their unions. “If Chrysler goes belly up,” he says, “it also might have forced some deep introspection at
Ford and G.M. and might have changed their attitude toward fuel efficiency and manufacturing quality.” Some of the bailout’s opponents — from free-market conservatives to Senator Gary Hart, then a rising Democrat — were making similar arguments three decades ago.

Instead, the bailout and import quotas fooled the automakers into thinking they could keep doing business as usual. In 1980, Detroit sold about 80 percent of all new vehicles in this country, according to Autodata. Today, it sells just 45 percent.

There is a similar chance for us to be fooled about the extent of today’s problems. Some day, house prices will stop falling and the financial markets will calm down. But the underlying problems aren’t going away on their own.

I believe strongly that we often learn more from failure than from success. Maybe we need a little more failure today, to make us stronger in the future.


Helicopters improve Patient Flow After Train Crash

There was one positive bit of news related to the terrible train crash near Los Angeles recently that caused deaths and injuries: A new emergency plan to distribute patients among area hospitals using helicopters worked well, according to an article in the Los Angeles Times.

I write about this because I suspect some lean principles may have been involved in developing the plan.

Think of it as kind of an inverted supply chain. In a typical supply chain, the provider of goods or services looks for the best way to distribute those goods or services to customers. In this case, officials were distributing customers – patients – to service providers.

Under the plan, victims were airlifted from the Chatsworth crash site to distant emergency rooms, such as at the Ronald Reagan UCLA Medical Center in Westwood, Cedars-Sinai Medical Center near West Hollywood and County-USC Medical Center in Boyle Heights.

Authorities said that at least 86 of the 135 injured passengers were hospitalized, almost half in critical condition. By comparison, 57 died and 138 were hospitalized in the 1994 Northridge earthquake. In 2005, a Metrolink crash near Glendale killed 11 and sent 140 to the hospital, but the injuries were less grave than in Friday's crash. The new plan was developed after reviews of the earlier Metrolink crash and the Santa Monica Farmers' Market crash in 2003 that left 10 dead, said Cathy Chidester, director of the county's Emergency Medical Services. The goal is to ensure that the injured get the proper level of care and to "spread patients out instead of having one hospital inundated" near a disaster scene, Chidester said…

Across the Santa Monica Mountains, the newly opened Ronald Reagan UCLA hospital treated eight crash victims, said Dr. Henry Gill Cryer, chief of trauma surgery. Five needed immediate surgery…

Cryer was pleased with how well the hospital, which opened in June, performed. But the county emergency plan, which he called "phenomenal," gets the real kudos, he said.

Dr. Daniel R. Margulies, trauma director at Cedars-Sinai, echoed the praise. His trauma center treated seven crash victims. Two needed immediate surgery.Word of the accident came as doctors and nurses were about to change shifts. An order went out immediately for them to stay put. But the distribution of patients went so smoothly that extra help wasn't needed.

The article doesn’t describe the distribution plan in detail. But I have to believe those who developed it – even if they never heard of lean – focused on eliminating waste from the process and “leveling” the flow of patients.

There also had to be a joint effort by what might be called supply chain partners – the hospitals, the agencies providing the emergency workers on the scene, the helicopter operators.

Are there lessons businesses can learn from this? What do you think?


Nine Authors at Productivity Inc. Conferences

Our friends at consulting firm Productivity Inc. are offering several simultaneous conferences next month that not only are a great opportunity to learn about lean, but also feature presentations and workshops conducted by many authors of the books we publish.

The four conferences, taking place the week of October 6 in Nashville, are:

Lean Management Conference
Lean Healthcare Forum
Lean Innovation Symposium
Lean Executive Forum

The authors you can hear at these conferences include, in alphabetical order:

Jean Cunningham, co-author of
Easier, Simpler, Faster: Systems Strategy for Lean IT

Andrew Dillon, original translator of several of the works of Japanese lean expert Shigeo Shingo

Mark Graban, author of
Lean Hospitals: Improving Quality, Patient Safety, and Employee Satisfaction

Naida Grunden, author of
The Pittsburgh Way to Efficient Healthcare: Improving Patient Care Using Toyota Based Methods

Thomas Jackson, author of
Hoshin Kanri for the Lean Enterprise: Developing Competitive Capabilities and Managing Profit

Drew Locher, author of
Value Stream Mapping for Lean Development: A How-To Guide for Streamlining Time to Market

Mark Nash and Sheila Poling, co-authors of
Mapping the Total Value Stream: A Comprehensive Guide for Production and Transactional Processes

Charles Robinson, co-author of
Implementing TPM: The North American Experience

James Vatalaro, co-author of
Implementing a Mixed Model Kanban System: The Lean Replenishment Technique for Pull Production

Some of these authors have written more than one book.

I hope you’ll be attending one of the conferences and can hear some of these experts. And if not, you can find a lot of wisdom in their books.


How to Reduce Fatal Car Accidents

I am writing today about something that is not exactly a lean topic. However, for reasons I’ll explain shortly, I feel compelled to comment on what some other writers are saying about driving and speed-limit laws.

Wall StreetJournal columnist Stephen Moore
recently attacked environmental groups and Republican Sen. John Warner, both of whom suggested a return to a federal 55-mile-per-hour speed limit as a way to conserve energy. Kevin Meyer, in the Evolving Excellence blog, agreed with Moore.

Moore argues that most drivers disobeyed the law; that the law reduced gasoline consumption only a little, and only during a brief period of strict enforcement, and that reducing the federal speed limit does nothing to save lives. In support of that last point, he cites a variety of statistics, including some showing that traffic fatalities actually fell during the decade after the lower federal speed limit was repealed in 1995.

Moore’s statistics are accurate, but they may not tell the whole story. In regard to the fatality rate falling, the
National Highway Traffic Safety Administration (NHTSA) notes that “An 81-percent seat belt use rate nationwide and a reduction in the rate of alcohol involvement in fatal crashes — to 41 percent in 2006 from 42 percent in 1996 — were significant contributions to maintaining this consistently low fatality rate.”

In other words, raising the speed limit might have led to more fatalities if it hadn’t been for more people wearing seat belts and drinking less alcohol. However, that’s just speculation on my part.

It might also be tempting to conclude from Moore’s comments that speeding and fatalities are unrelated. And that is not true. The NHTSA comments, “In 2006, speeding was a contributing factor in 31 percent of all fatal crashes, and 13,543 lives were lost in speeding-related crashes.”

This subject is a sensitive one for me. My son died in a car accident five years ago. He was 21 years old. Speeding was one factor in the crash.

So am I advocating a return to the lower speed limit? No. I’m inclined to agree that it would be ignored by most people and wouldn’t do much to save lives or energy.

One reason it might not save many lives, Moore says, is that “The evidence is overwhelming that traffic safety is based less on how fast the traffic is going than on the variability in speeds that people are driving. The granny who drives 20 mph below the pace of traffic on the freeway is often as much a safety menace as the 20-year-old hot rodder.”

That may be true. However, while I appreciate that Moore was attempting only to comment on speed-limit laws, I believe it is important to go beyond that and consider what WOULD make a difference.

So let’s try to think in lean terms and do a little root-cause analysis. Why do people speed? One factor, as Moore suggests, is that people like to get where they are going quickly. Another, which I believe is probably more important, is that people simply like to go fast – an attitude ingrained in them by a culture that portrays speeding, in movies and television, as really cool.

But there is something else to consider: People speed because they can. Because their cars allow them to.

If the maximum speed limit anywhere in the U.S. is 75 mph, then why are virtually all the motor vehicles sold in this country capable of going 90 mph, 100 mph, or faster? There are reasons, but none of them are good. It would be fairly easy to make cars and trucks – with existing technology – that are incapable of going faster than a specified limit.

We can debate what that limit should be. And yes, I’m sure there are plenty of people who wouldn’t like it. But I believe cars should be made this way, and I am hopeful that sooner or later they will be. Perhaps a clever auto manufacturer might begin by offering built-in speed limits on vehicles targeted to parents buying cars for their sons and daughters going off to college or just starting adulthood.

It might save lives. And who knows? It might even save some energy as well.


AnnTaylor Doesn’t Understand Improvement

I am all in favor of metrics. To truly become lean, a company has to constantly measure performance to identify where improvements can be made, and whether those improvements are working.

But at a company that doesn’t understand lean, data from metrics can be misused or applied in ways that may achieve some benefits while creating other problems.

article in The Wall Street Journal describes new measurement tools available to retailers – and how those tools are being applied in controversial ways at the AnnTaylor chain.

When saleswoman Nyla Houser types her code number into a cash register at the Ann Taylor store at the Oxford Valley Mall (in Langhorne, PA), it displays her "performance metrics": average sales per hour, units sold, and dollars per transaction. The system schedules the most productive sellers to work the busiest hours…

Vendors of the systems claim they can boost productivity by 15% or more, and can help cut labor costs by 5% or more. Wal-Mart just completed a yearlong rollout of a computerized scheduling system for 1.3 million workers. It cited 12% labor-productivity gains as a key reason for improved results in its fiscal quarter ended Jan. 31…

In May 2007, after Atlas (the AnnTaylor system) was tested in some stores, James M. Smith, chief financial officer at the time, said those stores were seeing a "pickup" in comparable-store sales. Kay Krill, AnnTaylor's chief executive, reported a "very promising" increase in conversion, meaning that more browsers were becoming buyers. AnnTaylor declined to elaborate on the financial effect.

In addition to using the system to measure performance, AnnTaylor also did some research to set standards.

Before it installed the system, AnnTaylor spent a year studying labor efficiencies. It established standards for how long it should take for employees to complete certain tasks: three seconds to greet a shopper; two minutes to help someone trying on clothing; 32 seconds to fold a sweater; and most importantly, five minutes to clinch a sale. Its goal was to figure out how many employees it needed in a store at any given time, based on customer traffic.

On the surface, all this might seem reasonable. But consider the consequences.

Some employees aren't happy about the trend. They say the systems leave them with shorter shifts, make it difficult to schedule their lives, and unleash Darwinian forces on the sales floor that damage morale…

Current and former employees of the Langhorne store say that within months of the system's installation in May 2007, the culture shifted from collegial to highly competitive. "You could see people stealing sales from other people," says Julie Abrams, a former cashier at the store. Salespeople were "trying to get each other out of the way to get to the client," she says…

AnnTaylor began ranking its salespeople according to their average sales-per-hour, among other things. When Ms. Abrams's sales-per-hour dropped, so did her ranking, she says. Her schedule changed accordingly. "My hours started being less when the heavy traffic was in the store," she recalls. The slow shifts, in turn, made it harder to boost her ranking.

Her pay varied widely week to week, she says. Before the system was installed, she says, her weekly pay sometimes was nearly $300, for about 34 hours of work. Afterward, she says, "I remember some weeks when the most hours I was getting was just eight. It is hard to budget that way." She took on two other part-time jobs. In April, she quit Ann Taylor to take a job that guaranteed her 30 hours a week.

Many other Langhorne employees also saw their hours cut back, and a few of them left, according to several former and current employees.

"A lot of people would be really upset about the way [the system] would schedule," says Tim Fasnacht, who managed an Ann Taylor Factory store in Philadelphia until March. "Sometimes, people would get a three-hour shift -- and you have people coming on public transportation from far away." Because the system didn't award seniority, he says, longtime employees would sometimes be scheduled for as little as 10 hours a week. "There was this huge battle between some of the longtime workers and the management over their schedules..."

Ms. Houser, a 59-year-old retired first-grade teacher, took an $8.50-per-hour part-time job at the Langhorne store in 2006 to supplement her retirement income. "She knew everybody and she spent sometimes half an hour with one customer," says Ms. Connell, a former assistant manager at that store, who left Ann Taylor last year. "One day, she would have $750 in sales per hour, and the next day it would be $250 per hour."

The new system, Ms. Houser says, doesn't reward her style of selling. It no longer pays to spend time developing relationships with shoppers who might not buy anything on a particular visit, she says. "My client [contact] book is fatter than anybody else's in the store," she says. "Does that mean I will get a bigger raise next time? No. Not if my [average sales] numbers don't reflect that."

One key problem here is the executives at Ann Taylor are trying to get better results without making any effort to improve processes or performance. If an employee has below-average sales figures, is the company doing anything to help that employee improve, by teaching that person how to become better at selling? Not as far as I can tell. There also does not appear to be any effort to find out WHY some employees sell more than others, which could lead to improvement.

Equally important, this approach shows absolutely no respect for people, a key principle of lean. The store’s employees are being treated as cogs in a machine, not as thinking individuals who might be able to contribute ideas that would help the company. It also sounds as if customers are not treated very well, either.

AnnTaylor and the other retail chains taking this approach may see some improvement in sales as a result, at least in the short term. But any benefits they obtain will fall short of what might be achieved through a lean approach with a commitment to improvement and respect for people.


Federal Loans for U.S. Automakers are a Bad Idea

The three U.S. automakers are pushing this month for Congressional approval of $25 billion in federal loans.

They shouldn’t get them.

this article in Industry Week notes, the loans are gaining support because of fear at least one of the three might go into bankruptcy, which “could have an enormous economic impact.”

I’ll get back to that in a moment. But first, consider how they got into this situation. For too many years, the U.S. companies made vehicles of poor quality using inefficient production methods – creating a situation that smart competitors (read Toyota, Honda and Nissan) were able to exploit.

Quality has improved, and the American companies are becoming leaner (though they still lag far behind the Asian companies).

But now the problem – so we are told – is technology. A law approved last December requires automakers to boost average fuel economy of their vehicles to 35 miles per gallon. The article notes that “The Bush administration has estimated that retooling for the new standards would cost the automakers $100 billion.”

So the automakers need the money to pay for retooling to meet fuel economy standards? They why doesn’t Toyota need loans?

Because technology and fuel economy are not the real issues. Detroit misjudged where the market would go, investing too heavily in big trucks and SUVs, and its failure to become lean means it lacks the flexibility today to respond quickly to market shifts.

Jerry Flint, automotive columnist for Forbes, notes an interesting fact in a
recent column. While the U.S. companies in July held a 43 percent share of the U.S. market for vehicles (a big drop from the past), if you factor out the trucks and SUVS and look just at cars, the U.S. share drops to 32 percent.

Flint comments, “Regaining a reasonable share of the car market will not be easy – not against today's foreign competition.”

If the U.S. companies get their $25 billion, what are they going to do with it? Will that amount of money make it possible for them to change how they operate in some radical way that will suddenly make them more competitive? I doubt it.

Yes, I know Chrysler received loan guarantees in 1979 – and emerged from that experience as a better, more competitive company (at least for a while). But today’s market is different from 29 years ago. Toyota was not the powerhouse it is today. Chrysler was competing primarily with GM and Ford.

In the Industry Week article, Peter Morici, an economist at the University of Maryland, accurately points out that “any loan program even if it is called a research plan would be a ‘fig leaf for a subsidy’ that distorts the market.” Unfortunately, Morici then goes on to say, "Our trading partners give us no choice. Every other major auto manufacturing country protects their industry so we may have to do the same."

Wrong. I’m not saying other countries don’t engage in protectionism or subsidies. But this is the same tired argument that implies foreign protectionism is the cause of the U.S. auto companies’ problems. Market miscalculations and poor manufacturing processes have a lot more to do with it.

There is one final argument in support of the loan guarantees – the idea that some companies are so big and important they cannot be allowed to fail.

I see two problems with that idea. First, as big as the U.S. auto companies are, I don’t believe a bankruptcy of any one of them would be that devastating to the economy – not with the way the market has shifted. Second, any bankruptcy filing would almost certainly be under Chapter 11, so that the company would continue to operate and seek to recover. As such, it would not "fail." And I believe bankruptcy would do more to force an auto company to change its ways than a government bailout.

The loans are politically popular and may be approved. I hope they aren’t.


Electricity and Mining: Lean Can Work for Everyone

It is always encouraging to listen to business executives who are open-minded about lean.

Too often, people who work in an industry where lean is not well-known will voice some variation of the phrase “we’re different” – meaning they view lean as applying only to manufacturing generally or the automotive industry specifically, and don’t believe it will work for them.

A refreshing example of the opposite situation was presented at the recent San Diego regional conference of the
Association for Manufacturing Excellence. I’m referring to a presentation by two executives of Luminant.

Texas-based Luminant is a utility company, but it is really in two businesses. One is generating electricity: The company is the largest power company in Texas and one of the largest in the country. Its other business is mining coal to produce that electricity. Luminant is, in fact, the 10th largest mining company in the U.S.

I’ve only heard of a handful of utilities that have embraced lean, and I don’t believe I’ve ever heard of a mining company doing so.

Luminant has been on a lean journey for at least four years. And its leaders seem to understand that, to truly succeed, lean must involve the total enterprise. They described their efforts to not only apply lean to all aspects of operations, but to involve all employees through training and participation. “Each employee was expected to have one implemented idea per week,” said Steve Wells of Luminant, one of the speakers.

He and colleague Paul Dowden described the millions of dollars in revenue improvements resulting from the transformation (not to mention a significant increase in the company’s stock price). Another benefit of lean: “It makes your dog much safer. You don’t go home and kick him now,” Wells said jokingly. (At least I hope he was joking.)

And in a further example of what can be the cross-industry appeal of lean, Wells said representatives of American Airlines had visited Luminant to view their lean accomplishments.

Have you ever benefited from studying lean at a completely different industry? How did that help?


Was Michael Hammer A Lean Business Guru?

The name of Dr. Michael Hammer is generally not associated with lean. But as a business author and guru who focused on ways to improve companies, his work should be of interest to lean advocates.

And with the news that Hammer died of a brain hemorrhage this week at the age of 60, perhaps now is an appropriate time to talk about him.

Hammer is best known as co-author, with James Champy, of Re-Engineering the Corporation, an influential business book published in 1993 that spent 41 weeks on the best-seller lists of The New York Times.

I never read the book, although I did hear Hammer speak once. I was impressed by his intelligence and his concepts. The speech was a good number of years ago, before I became a lean devotee.

According to the
obituary in The New York Times, the book

promoted the idea of simplifying and reorganizing business departments by having the workers break down their activities into logical, bite-size pieces, then take a “clean sheet” approach to reassembling their work for greater efficiency and productivity…

Stephen P. Kaufman, a senior lecturer at the Harvard Business School, said in an interview Thursday that after the book’s release, “there was a large flurry of re-engineering projects, led both by consulting firms that would teach the process to companies and by the companies themselves.” Mr. Kaufman added that he “would not quite call it a revolution, but a very useful tool in the tool bag of effective managers.”

Time magazine saw it differently — and laced with an element of controversy.
In its 1996 profile of Dr. Hammer, it said his book “set in motion a revolution the likes of which hadn’t been seen since Henry Ford
introduced the assembly line. Like most revolutions, this one has been extremely messy. Such huge firms as Procter & Gamble, Xerox
and American Standard have successfully taken a Hammer to their structures.”

“At the same time,” the profile continued, “re-engineering has become synonymous with less elegant forms of reorganization, notably downsizing, in which C.E.O.’s fire workers wholesale to make a company more ‘efficient.’ ”

Dr. Hammer and Mr. Champy were deeply concerned about the misuse of their premise.

“It is astonishing to me the extent to which the term re-engineering has been hijacked, misappropriated and misunderstood,” Dr. Hammer told Time, saying that ideally, re-engineering should promote greater production and create more jobs.

It sounds as if Hammer’s concepts and lean concepts have some elements in common.

Have any of you ever worked at a company that applied Hammer’s re-engineering concepts? What was your experience? And do those concepts contain elements of lean? We look forward to your comments.


Silo Thinking and Safety Problems: How Lean Can Go Wrong

In the latest issue of Target magazine from the Association for Manufacturing Excellence, our friend Karen Wilhelm – who writes the Lean Reflections blog – offers an interesting example of what she calls lean gone wrong.

In the article (not yet available online), she describes how an (unnamed) footwear manufacturer achieved great benefits in a factory in China by implementing lean improvements. Order-to-delivery lead times were cut dramatically, WIP was reduced significantly and quality improvement.

The improvements resulted in large part from creation of manufacturing cells, out of what had previously been batch processing in separate departments.

However, a joint U.S.-Chinese research team studied the impact of the change and found numerous safety problems.

Several of these had to do with people being too close to dangerous machines without proper protection. In my view, what Karen describes was evidence that silo thinking was still in evidence. For example, the operators of hot presses were protected from heat and noise. But those presses were now in a cell, near other machines. And the operators of those other machines were close enough to need protection as well – but didn’t have it.

Karen says the situation raises the question, “How can you screen potential suppliers before traveling halfway around the world to make a plant visit?” She then discusses efforts to develop an international safety standard.

That’s a good point. I would also focus on the always-challenging and too-often-ignored need to get companies to focus on the lean principle of respect for people. That usually refers to respecting the intelligence and creativity workers can bring to their jobs. However, I would suggest it also means showing respect for their working conditions, including safety.

Some people say the lean tool of 5S should really be 6S, with the sixth “S” being safety. But that’s too narrow, in my view. Safety should always be a concern, not just in regard to 5S.

Do you find that silo thinking remains even after setting up manufacturing cells? How do you make safety an integral part of a lean operation? Please share your experiences below.