On the blog, they’ll be discussing the concepts of the book and will try to address questions they receive.
The book makes the critical point that what is important about A3 reports is not just the reports themselves (though they can be a valuable visual tool), but the thinking that underlies the process.
I’ve added their blog to our list of Other Lean Blogs on this page. Be sure to check it out.
Sometimes the causes and solutions of a problem are not obvious and require careful analysis. For example, I recently wrote about hospital readmissions, a problem identified by a study of Medicare data.
But at other times, something seems so obvious that you can only shake your head in sad wonder.
Case in point: Nearly 11,000 former members of the armed forces may have been exposed to HIV and/or hepatitis because they received endoscopies at three Veterans’ Administration hospitals in the southeast with equipment that hadn’t been cleaned properly.
The problem was first reported early this year. More recently, as reported by The Washington Post in a story by the Associated Press, the number of confirmed cases of hepatitis and HIV is growing, and veterans are frustrated that the VA is not providing much information about the situation.
From a public relations standpoint, it sounds as if the VA is handling the situation badly. However, I would like to focus on what in the VA’s processes led to the problem.
An endoscope is a narrow, flexible tube with a fiber-optic device at the end. It is inserted into the body during colonoscopies and certain ear, nose and throat treatments.
The VA said the problems with the endoscopic equipment had gone on for years, but were discovered in December when it learned the Murfreesboro facility wasn't following cleaning procedures the manufacturer recommended. It issued an internal alert for hospitals to check their procedures, and the problem at Augusta was discovered in January…
The endoscopic equipment is made by Center Valley, Pa.-based Olympus American Inc., and the company has said its recommended cleaning procedures are clear.
Without more information, it is difficult to determine why the manufacturer’s recommendations weren’t being followed. Possible causes include that the manufacturer’s recommendations actually weren’t clear, or that, clear or not, the cleaning procedures weren’t communicated properly, or that the responsible staffers were not properly trained in cleaning procedures.
Whatever the cause, the solution almost certainly involves applying several lean principles: clear communication, creation of standard work, proper training of staff, and regular reviews or audits to ensure that proper practices are being followed.
It is a shame the VA doesn’t seem to understand lean. Our veterans deserve better.
Safety is a key, if often unheralded principle of lean manufacturing. The lean concept of respect for people includes recognition that workers should not be exposed to unsafe working conditions. Many people argue that the tool of 5S really ought to be 6S, with safety the 6th “S.”
So from a lean perspective, it is worth taking a look at President Obama’s choice to head the Occupational Safety and Health Administration.
He is Jordan Barab, who spent the past two years as senior labor policy advisor for health and safety on the House Education and Labor Committee.
By all accounts, Barab is a passionate true believer and crusader for workplace safety. As a union staffer, he directed the safety and health program for the American Federation of State County and Municipal Employees (AFSCME) from 1982 to 1998.
For four years, he wrote a blog about workplace safety called Confined Space. And while he stopped writing the blog two years ago, all of the posts are still online.
I spent some time browsing the blog. On the one hand, Barab seems to understand that safety problems are rarely the result of worker carelessness, but have much more to do with poor processes or working conditions.
However, I don’t know whether he understands that the best road to improvement lies in carefully analyzing the process to understand the best way to improve it. His focus over the years has been on government mandating safety regulations.
(I’m not opposed to government safety regulations. I believe in them. I just like them to make sense for the business as well as the workers.)
One of the few references I found on his blog to lean manufacturing was when he was quoting an article written elsewhere about an incident of workplace violence at a Chrysler plant. The article he quoted suggested that the violence was at least partly the result of systematic harassment of workers by Chrysler over many months, and that “lean production” initiatives had been part of that harassment by attacking the seniority system, pitting workers against each other.
Of course, whatever Chrysler called “lean” clearly wasn’t. I hope this article or anything else he has read doesn’t prejudice Barab against lean principles simply because they were misused or misinterpreted by one employer.
Do you know anything more about Jordan Barab? Please share it in a comment.
Describing the fictional Twin City Manufacturing, the authors draw on their combined 70 years of supply-chain experience to explore successful supply chain improvement requirements and improvement methodologies, along with their strengths and limitations.
They provide a road map for supply-chain improvement, focusing on how to enable and sustain long-term change.
The authors also discuss the seven factors that they believe are key to operational excellence:
1. Top company leadership
2. Improvement methodology
3. Continuous improvement strategy
4. The cause and the vision
5. The Sustainable Improvement Roadmap
6. Enablement of sustainability
7. Constancy of purpose
Those of you focused on supply chains now have a rapidly growing selection of resources. Only two weeks ago, I discussed another new book Supply Chain Management at Warp Speed.
Do you have a question or comment about a book(s) that you would like addressed in Book Talk? Email me directly at Ralph.bernstein@taylorandfrancis.com.
Rework is waste. You shouldn’t have to bring a product back to your factory for additional work if everything was done right the first time.
That lean concept can be applied, to some extent, to rehospitalizations. When a patient has left a hospital, a return visit – at least in some cases – should not be necessary.
But many return visits occur. Health Leaders Media reports on a new study published in The New England Journal of Medicine. The authors of the study analyzed Medicare claims data for 2003-2004. They found that nearly 20 percent of discharged patients are readmitted to the hospital within a month, and the figure jumps to 34 percent when looking at three months.
Not every readmission is waste. The authors of the study estimate that about 10 percent of the readmissions were planned. And sometimes patients require readmission even when everything was done right the first time.
But readmission rates vary widely among hospitals, and the authors believe that much can be done to bring the rates down. Although he doesn’t use lean terminology, one doctor seems to suggest the problem is we’re not looking at the total value stream.
"In order to address this issue, we are going to wind up addressing the most profound issues in healthcare today," says Stephen Jencks, MD, MPH, a lead author of the study and independent consultant in healthcare safety and quality. "Issues like a system which has become provider-centered rather than patient- and family-centered. If your concerns stop when the patient goes out the door of the hospital or start when the patient comes in the door of your office, you're not going to provide the care that's necessary to keep people from being rehospitalized."
Unnecessary readmissions occur because some patients and families are not properly educated about what follow-up care must occur, and the resources are not put in place to provide that care. Lacking that care, discharged patients deteriorate to the point where readmission is required.
The article mentions several recommendations for improvement, many of which involve better education of patients and their caregivers. However, my favorite has to do with the workflow involved in scheduling a follow-up appointment.
Prevent the patient from leaving the hospital without a follow-up appointment of some kind. In his study, Jencks and his colleagues found that about 50% of patients who were rehospitalized had not been seen by an interim physician after 30 days. Hospitals often say that they can't make an appointment in that short of a timeframe for a patient's follow-up care, says Jenks. "My answer is, well if you can't get it how do you think the patient's going to get it?"
In 2004, $17.4 billion was spent caring for patients readmitted to the hospital; Medicare paid hospitals $102.6 billion in total that year. This issue is significant.
Porsche is an extremely successful car company, and an article in The New York Timessuggests that success stems from a lean approach. Unfortunately, the Times gets it wrong.
The article, by Carter Dougherty, notes that Porsche goes beyond other car companies when it comes to outsourcing. Rather than just outsource production of certain parts or subassemblies, Porsche has some entire cars assembled by Valmet Automotive, a company in Finland.
In some sense, the innovation makes Porsche the only major virtual vehicle manufacturer, a company that designs and markets sports cars without actually cranking them all out on its own production line.
The bread and butter of Porsche’s work in Stuttgart is the classic 911 sports car, but with demand for that model now falling, it is pulling Boxster production out of (Valmet) back to Germany. Though the system creates fiendishly complex logistical challenges, Stuttgart can keep running at capacity, evading the industry’s hoary problem of covering the fixed costs of factories and labor.
Porsche is profitable, well-run in many ways, and taking production back from Valmet does enable it to avoid laying off its own employees. However, the Times article says the arrangement with Valmet “is inspired by Japanese models of lean manufacturing.”
Sorry, but simply transferring work to a supplier is not lean. Eliminating waste from a process is lean; making the process someone else’s responsibility is not.
Ironically, the description in the article makes Valmet sound like the lean company in this relationship because it demonstrates impressive flexibility.
Ilpo Korhonen, Valmet’s president, a cerebral engineer with an M.B.A., is constantly calibrating his work force to match Porsche’s needs with the deft touch of an artist applying the final brushstrokes to a masterpiece. In each of the last three months, he idled about a third of Valmet’s 600 employees before ramping up again in January and February, and then shifting down with 190 layoffs in March.
“We are adjusting capacity almost daily,” Mr. Korhonen said.
Managing the inflow of parts that go into a high-performance Porsche is another tricky task. Many suppliers are concentrated near Stuttgart, but Valmet has to arrange deliveries to Finland, and often in smaller quantities.
Hence the “milk run,” as Mr. Korhonen calls it. Trucks are perpetually swinging through Germany, Poland, Sweden and Finland to collect the components that go into the Porsches assembled in Uusikaupunki…
But Valmet’s greatest challenge is, in the end, existential. Its contract with Porsche expires in 2012. The German company will move its outsourced assembly to Magna Steyr, a company in Austria, which has the resources to assist Porsche in some development work.
Valmet workers are already clearing space in the factory to manufacture the Karma, a plug-in electric hybrid designed by Fisker Automotive, a California start-up. It will also soon produce a luxury golf car for a Danish customer and expects to sell other engineering services as automakers create derivatives of existing models, Mr. Korhonen said.
And when the well-to-do rediscover their love of Porsche sports cars, Valmet hopes to produce those, too.
“Eventually we will ramp back up,” Mr. Korhonen said. “We expect the market to recover.”
I would suggest that the true hallmark of a lean company is that it doesn’t outsource, but finds its savings by streamlining its processes – not offloading them.
Sproull, an experienced manufacturing executive and consultant, believes your goal should be to focus your efforts on those areas that will make the greatest difference. He says the way to do this is by drawing the best from Lean and Six Sigma by employing principles drawn from the Theory of Constraints.
The result is a “time-release” formula designed to take advantage of the cyclical nature of improvement to implement change that is perpetually effective.
I find this encouraging because I’ve long believed the debate over whether lean or sigma (or TOC) is best is pointless. Each has its strengths and is particularly useful in some situations, and the point should be to select the approach and the tools that are best for your company’s situation. Sproull’s concepts – which go beyond some other efforts that combine lean and Six Sigma without TOC – may expand your toolbox.
Sproull’s approach deals with cost accounting, variation, waste, and performance measurements, among other areas, though focusing on the right areas to optimize is probably the biggest benefit.
Do you have a question or comment about a book(s) that you would like addressed in Book Talk? Email me directly at Ralph.bernstein@taylorandfrancis.com.
I’m generally a fan of Amazon.com. They know how to focus on providing value for the customer (a lean principle) by offering a wide range of products on a user-friendly website that eliminates a lot of waste from the process of ordering.
But my respect dropped a notch when I received a package from them the other day.
It contained four items I had ordered: two books, a backpack (which was fairly flat) and an electric toothbrush (sealed in a fairly small plastic package).
The box they came in was unnecessarily large. The four items took up no more than a third of the space in the box. The rest was occupied by air-filled plastic bubbles, each about the volume of a grapefruit, serving as padding.
I understand that Amazon cannot perfectly match the size of the shipping box to the size of the order every time. But I thought they could have done a better job on this one.
Our apologies to those of you who tried to visit the Productivity Press website this morning and found yourselves redirected to the website of our sister company, CRC Press. Productivity Press books also appear on the CRC Press website, which was just redesigned. Somehow, when the new CRC website went live, it inadvertently redirected Productivity Press visitors. That has now been corrected, and we are back to normal. We're still here, and we have plenty of new books coming out in the months ahead. We're glad to have you with us!
The fundamental concepts of lean are designed for free, democratic markets. The lean focus on creating value for the customer assumes that customers have the right to define value, and that customers have the ability to choose among competing products.
In a dictatorship, the government may limit the products available and not be concerned with what the customer would view as valuable. The results include inefficient operations, unpopular products of low quality, and unhappy citizens – conditions that, in my view, cause citizens to view the government as illegitimate and may ultimately lead to its downfall.
These thoughts are prompted by an article in The New York Timesprofiling the Avtovaz auto plant in Tolyatti, Russia – which the article, written by Andrew Kramer, describes as “one of the least efficient automobile factories anywhere in the world — each worker produces, on average, eight cars a year, compared with 36 cars a year at General Motors’ assembly line in Bowling Green, Ky., for example.”
The cars made at the factory are inexpensive, but quality is poor and style hasn’t changed much in 40 years.
Russian leaders are not concerned with inefficiency.
The government is giving Avtovaz billions of dollars in aid, no strings attached. No chief executive firings. No renegotiation of workers’ contracts. No demands to turn out better-quality cars, much less fuel-efficient hybrid cars. (The first car with an airbag was introduced here in 2005.)
But the auto bailout, Russian style, is intended more to ensure peace in the streets than restructure a business, much to the lament of some critics who think tough love might be better.
“The key issue is too much government protection,” Yegor T. Gaidar, a former prime minister, said. “The factory will create as many problems for the Russian economy as General Motors for the States.”
Russia is suffering from the worldwide recession. Layoffs in the past, including 400 job cuts at a GM joint venture in December, sparked protests. It is that potential for social unrest that worries politicians.
So they are providing bailout money to preserve jobs, imposing a tariff on imported cars and even subsidizing auto loans to stimulate demand. (The tariff set off protests and a police crackdown in Vladivostok, a major center for importing and servicing secondhand Japanese cars.)
Russia may succeed, in the short term, in preserving jobs and limiting social unrest. But the bigger picture is a country not competitive globally, with a troubled economy, a government strained by excessive spending, and a population simultaneously demanding more government care and better products.
Change will not come easily, and will undoubtedly involve considerable upheaval in government and the economy. It will also require massive societal culture change, in the way people think about their country, their government and the world of business.
That last area will require lean thinking. I hope change does come, and I hope lean can play a small part in making it happen.
Why does lean focus on creating value for the customer? One reason is that failing to create such value can damage the relationship with the customer. And once that relationship is damaged, rebuilding it is incredibly difficult.
The Malibu was a popular car, stylish and powerful, from the mid-1960s until it was phased out in 1983. It was brought back in 1997, but the new version was mediocre.
After Bob Lutz joined GM as vice chairman in 2001, he made redesigning the mid-size Malibu a personal project, and brought together a team of designers, engineers and marketers to handle it.
Leaders of the team say Mr. Lutz made clear that the goal wasn't to improve upon the existing Malibu but to beat the competition. Their assignment was to create a car with a base price starting just above $20,000 but with the look and feel of a luxury sedan.
They spent weeks studying the Camry and Accord looking for weakness to potentially exploit. They studied the low-end products that fashion designers were crafting for Target Corp. discount stores, in search of secrets to a luxurious look at non-luxury prices.
The team did its job and produced a high-quality vehicle that won awards and was even recommended by the independent publication Consumer Reports.
So the car was a winner, right? Nope. It’s selling better than previous versions of the Malibu.But last year, the Camry outsold the Malibu 437,000 to 177,000.
The problem is, no one trusts GM. The article provides several examples of buyers whose past history of quality problems makes them unwilling to buy a GM car, despite widespread acknowledgement of the Malibu’s quality.
"A perception of inferior quality is the most serious problem facing GM," aside from its financial predicament, says David Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich…
"It takes a long time to break through," says GM spokesman Dee Allen. "We have trouble getting people to even give the Malibu a try."
The article also quotes a Toyota spokesman as saying that, although the Malibu beat the Camry in J.D. Power’s initial-quality survey last year, "Quality is a marathon, not a sprint."
By the way, if you’d like additional insights into what people think of GM today, browse through the more than 100 comments posted on the WSJ article.
GM hopes to continue impressing people with its vehicles as, this year, it introduces a redesigned Camaro, the new Cruze and the electric-powered Volt.
Will that be enough to repair the damage to its relationship with its customers? Maybe. But I wouldn’t bet the farm on it.
The theory of constraints (TOC), popularized by Dr. Eliyahu Goldratt, has been a respected part of the improvement world for some time. We are now about to publish the first book that describes in detail the application of the TOC approach to assured availability in distribution, for both original equipment manufacturers and retailers.
Supply Chain Management at Warp Speed: Integrating the System from End to Endby Eli Schragenheim and H. William Dettmer is a sequel to Manufacturing at Warp Speed, written by the same two authors and published nine years ago.The first book expressed ideas that were, at the time, cutting age, and were later adopted by Goldratt.
The new book addresses the performance issues of the entire supply chain. It addresses the new demands taken on when a firm offers to handle rush orders. It also reviews the issues surrounding availability and the management of inventory moving through distribution systems. The book is fully illustrated and includes examples, case studies and scenarios.
Do you have a question or comment about a book(s) that you would like addressed in Book Talk? Email me directly at Ralph.bernstein@taylorandfrancis.com.
Karen Gordon Mills was confirmed this week as administrator of the Small Business Administration. I’ve been reading about her background, trying to figure out if she will help promote the concepts of a lean strategy.
While she may not be a bad choice for the job, I see nothing in her experience to suggest she knows anything about lean.
For many years, she has been a successful leader of venture capital firms. She has a Harvard MBA and at one time worked for consulting firm McKinsey and Co.
It is hard to tell how much experience she has in actual business operations. Early in her career she worked in product management for General Foods. As a venture capitalist, she “took a leadership role” in some companies in which her firm invested, according to one profile.
In a statement at her confirmation hearing, she said, “In the mid 1980s, I was responsible for a number of traditional manufacturing businesses -- from plastic injection molders in Ohio – to a sub-fractional motor company in Arkansas. I was there on the factory floor when we had to weather the recession of the early ‘90s. Those experiences give me a deep understanding of what our small businesses need today to survive this downturn and to prosper in the years ahead.”
The American Hospital Association has launched a new initiative called Hospitals in Pursuit of Excellence (HPOE). While information about the initiative doesn’t specifically mention lean, it seems to be pointed in the right direction.
The effort focuses on four areas: healthcare-acquired infections, medication management, patient throughput and patient safety.The AHA website features numerous case studies of hospital improvement efforts, with an invitation to other hospitals to submit their own.
What HPOE clearly shows, says Rich Umbdenstock, president and CEO of the AmericanHospital Association, is that these are systemic problems. “They are problems with the internal processes in hospitals,” he says. “And only through a more systems-oriented approach, which is an approach that is foreign to a lot of us in the health care field, can you start to understand where the opportunities for improvement are and how to make those improvements so they bring lasting, not temporary, results.”
AHA is distributing a guide on the program to every hospital in the U.S. Personally, I‘d also like to see them give each hospital a copy of Lean Hospitalsby Mark Graban, as well as a few other of our healthcare-related books.
The AHA initiative parallels other healthcare-related efforts, such as the 5 Million Lives campaign, a program of the Institute for Healthcare Improvement that concluded in December.
It is good to know that the drive for healthcare improvement is expanding.
A recent trip to Florida got me thinking about how to cope with overcapacity – in this case, in the travel industry. I didn’t come up with any easy answers, so perhaps this posting will prompt some comments with worthwhile suggestions.
I flew on Continental from Newark to Fort Lauderdale on a 7:30 a.m. weekday flight. Much to my surprise, the plane was no more than two-thirds full. A flight attendant told me that the 6:30 a.m. flight, considered more of a business flight, was always full. Perhaps. But the simple fact that any flight nowadays could have so many empty seats is indicative of the decline in travel that has already been widely reported.
(For the record, my return flight two days later was full. However, that 6:30 pm flight took off two hours late because of weather problems. I believe it may have had additional passengers from earlier delayed flights, and I know it was filled up partly with stand-by travelers.)
When I arrived in Fort Lauderdale, I went to Dollar Rent a Car to pick up my reserved vehicle. Dollar has a counter with about 20 computer stations, but only three of them were staffed. The agent I spoke with told me most employees were in a meeting. Perhaps. But I don’t know how many employees were actually there. And the line of people waiting to pick up cars wasn’t that long.
Those two specific examples aside, we know that airlines and car rental companies are suffering. How do you cope with that? A partially full plane doesn’t cost any less to fly than a full one. And the maintenance of a 20-station rental counter doesn’t go down when business is slow, though staffing costs will be less.
Airlines are mothballing some planes, but that approach has its limitations.
What lean principles or methods are most relevant here? How do you cope with high fixed costs during a business downturn? Post your thoughts below.
The majority of books about lean focus on lean for assembly operations – what is known as discrete manufacturing. There isn’t much available that focuses specifically on process manufacturing – those industries that do not make assembled products, but produce foods, chemicals, fertilizers and pharmaceuticals, for example.
Lean principles can certainly be applied to process manufacturing, so general lean books have some value. And we do publish TPM in Process Industriesby Tokutaro Suzuki. But of course, lean is a lot more than TPM. And there are differences in how lean might be applied in process industries.
King is a principal consultant in DuPont Corporate Operations, in the Lean Center of Technology. He has over 40 years experience at DuPont in R&D, manufacturing, systems analysis and work process improvement.
As the title implies, this book focuses on how to apply lean in process industries to achieve the greatest benefit. This is discussed not only in conceptual terms, but also with diagrams, graphs and charts to clarify the concepts. And the book features an application of its concepts to a hypothetical process, including use of a value stream map.
Predicting success is difficult, but I believe this is likely to be one of our best-sellers.
Do you have a question or comment about a book(s) that you would like addressed in Book Talk? Email me directly at Ralph.bernstein@taylorandfrancis.com.
I wrote recently about my experience using handheld scanners at my local Stop & Shop supermarket. I praised the technology for eliminating waste from the shopping process by reducing the extent to which groceries are handled.
Dwane Lay, who writes a blog called Lean HR, posted a comment raising a logical question: How does the supermarket guard against theft? Since the system involves the shopper taking an item, scanning it and putting it directly into a bag, how do you know if a shopper puts an item in the bag without scanning it?
Dwane noted that some self-service systems are based on product weight. I believe that is true with Stop & Shop’s self-service lane, but it doesn’t seem to be the case with the handheld scanner. There is no special technology on the shopping cart, and the cart itself is not weighed.
Use of the handheld scanner is allowed only after you scan your frequent shopper tag. So the store knows who is using the scanners, and presumably could spot any shopping patterns (or change in shopping patterns) that would suggest something is wrong. However, that is just speculation on my part.
Since I didn’t know the answer, I contacted Stop & Shop. I traded emails with Faith Weiner of their PR department, who wrote “We are comfortable with our in store security system and do not comment on how it works as that jeopardizes the integrity of the security and the shopping experience itself.”
So for now, I still don’t know the answer. Are there any retail security experts out there who can offer some insight?
Johnson wrote about the steel industry, noting a protectionist proposal from a U.S. Steel executive concerned about greenhouse gas legislation. The executive suggested imposing carbon fees on imports of steel from countries that don’t regulate greenhouse gas emissions.
But then Johnson raises a good question: What if cleaning up the steel industry also makes it more competitive?
As an example, he describes technology that makes it possible to reduce pollution from blast furnaces. As it happens, deploying that technology also reduces energy use and reduces the price of steel.
He comments:
Making manufacturing more efficient generally makes it cleaner, cheaper and more competitive. Something to keep in mind during the coming rumble over climate legislation.
Johnson may not be aware that lean is the best way to make manufacturing more efficient. But there are plenty of us who can make that point for him.
The majority of books about lean focus on lean for assembly operations – what is known as discrete manufacturing. There isn’t much available that focuses specifically on process manufacturing – those industries that do not make assembled products, but produce foods, chemicals, fertilizers and pharmaceuticals, for example.