Do Not Underestimate…

Now that I am back in the consulting game, I was invited to take a close look at a fast-failing operation to see if I can lead a turnaround and after a 3 week assessment, it is not clear that we can fix all that is broken under the same roof.

This particular outsourced operation was completely underestimated by the owners of the business that agreed to take on the product line.  They assumed that this was a plug-and-play operation and it is anything but.  They took on a business with absolutely no competence or understanding on the core process involved with this line.

Within a couple weeks after startup, required production volumes were a mere 10-20% of required output to satisfy customer demand.   And the demand is growing.

Key issues leading to failure:

  1. No technical ability to execute the manufacturing process resulting in massive backorders, equipment breakdowns, poor setups and operation, and defective product.
  2. Poor equipment maintenance practices resulting in significant equipment downtime while attempting to repair complex equipment which is not understood.
  3. Leadership capability greatly underestimated resulting in the shop leader spread too thin to effectively learn the process, teach the process, perform effective setups and prepare raw materials, and instill a necessary sense of discipline.
  4. Management that is frozen in that they have no direction, no plan to get out of the hole with the ultimate result of the business calling in high priced consultants to try to salvage the customer orders.

Fortunately, we are able to mitigate the harm to the customers but at great expense to the business, nearly missing huge losses.  And ultimately, we will find another source to manufacture these products since the current source failed badly.

It pays to recognize the competence required to effectively and efficiently execute seemingly simple manufacturing processes.  These guys totally underestimated this process and it has cost them dearly.  I am reminded daily of bad business decisions that can take place and create great damage that can result within a very short period of time.

Perhaps the most painful aspect of this, is the toll this bad decision has taken on the employees that show up every day and do battle to make this happen.  Many thanked me profusely when I handed them copies of the manuals for the equipment they have been struggling with.

I found them sitting in boxes, untouched for months.

Their frustration trying to do well without training has been very painful to watch and through little fault of their own, they will never really get the chance to experience the success of this turnaround.

Stay tuned, we have some work to do.

164lbs082018Michael Bates has over 35 years’ experience as a Lean practitioner, including 30 years’ in operations leadership.  He holds numerous Lean certifications and is a Six Sigma Master Black Belt.  Michael is also certified in Project, Program and Portfolio Management and has led dozens of projects ranging from relocations, new product development, and turnarounds.

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Waste

So now it’s time to talk about waste.  Muda.  Non-value-added.

There are a few ways to list the 8 sources of waste but for the sake of simplicity, I will opt for using the DOWNTIME acronym.

  1. Defects
  2. Overproduction
  3. Waiting
  4. Non-utilized talent
  5. Transportation
  6. Inventory
  7. Motion
  8. Excessive Processing

So here’s a few things you need to know about waste in any form.

  • It rarely fits into any one of these buckets.  For example, inventory is often found waiting to be processed and requires transportation to move it around sometimes by highly skilled workers.  Inventory is also easy to overproduce just to make sure there’s enough and can contains defects waiting to be found.  And for materials susceptible to environmental conditions, it can spoil rendering it, well, trash.
  • Every value stream contains waste.  I’ve never seen a single example of a waste-free stream.  Often, we will map a value stream for the first time and find over 90% of the activities to be considered waste.  Remember, value is defined by the customer, not the producer.
  • Waste is money.  It will pull profits out of your process if it is not eliminated.  It will create safety, quality, delivery, and cost issues.  It can make your customers very unhappy with you because it might not fit their definition of value.
  • Sometimes waste is necessary.  Usually it is not.
  • Waste likes to hide.  It can be wiley.  Sometimes it can only be seen when you look for it.  The good news is there are tried and true methods for identifying and eliminating waste.  Plenty of ’em.
  • Once you learn to see it, you will see it everywhere.  Everywhere.

So how do we see waste?

We draw a map.  A big, beautiful map.  Using sticky notes.  When we are finished with our map, we will see the waste.

It will be glaring.  It will be ugly.  But when we put our our waste goggles on and see it, we can begin to do something about it.

Up next:  The Value Stream

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Michael Bates has over 35 years’ experience as a Lean practitioner, including 30 years’ leading manufacturing, engineering, and service operations.  He holds numerous Lean certifications and is a Six Sigma Master Black Belt.  Michael is also certified in Project, Program and Portfolio Management.

Value

In my last post, I mentioned the game-changing book Lean Thinking by James Womack and Daniel Jones.  They get right down to business with the 5 principles of Lean, the first of which is Specify Value.

Value can only be defined by the customer and it only has meaning when it is expressed in terms of a specific product that meets the customer’s needs at a specific price at a specific time. 

Value can only be created by the producer.  Womack and Jones state that this is the reason producers exist — to create value for the customer.  So, to restate this from a from a Lean perspective, in order to produce value it first has to be defined by the customer.

I have led product development projects that we, as the producer, defined the value to the customer and can say that the products and related services were, at the end of the day, off the mark.  Assuming we new best resulted in costly product feature changes and launch delays.  A couple of the lines never fully recovered and the 3-year life cycle was plagued with inefficiencies, delivery and quality issues, engineering mishaps, and ultimately, reduced margins.

Our most successful projects involved key customers in the features design process and subsequent service of our flagship products.  This allowed us to hear their definition of value and design a product flow that delivered that value successfully throughout the 3-year life cycle of the product.  The momentum of that success carried forward into the next flagship redesign, which proved to be more successful.

Once we understood the value as defined by the customer, we deployed lean methodologies in all areas of the organization and lo and behold, we had some pretty favorable margins as the result of the cultural shift.  It’s easy to speak in terms solely of the product, but we dug in to truly understand our customers’ business models which ensured timely invoicing and payments.

Value.

Up next: Muda

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Michael Bates has over 35 years’ experience as a lean practitioner, 30 of which while leading manufacturing, engineering, and service operations.  He holds numerous Lean certifications and is a Six Sigma Master Black Belt.  Michael is also certified in Project, Program and Portfolio Management.

A Year to Make a Can of Soda?

I recently, for the umpteenth time, listened to Lean Thinking – Banish Waste and Create Wealth in Your Corporation and in my opinion, it stands the test of time.  This gem keeps Lean, or Continuous Improvement, simple.

Regardless of the product or service, it is as important as ever to understand the value to the customer, the value stream that brings the product or service to the customer, how to ensure your product or service flows based on demand pulling it through your value stream, and the importance of continuously striving for perfection.

My well-worn book has plenty of marked up pages and the audio book brings the familiar and soothing voice of Mr. Womack into my car.

You must experience this if you care about bringing value to your customers.

And yes, it can take up to a year or more to make a can of soda. Pick up a copy in the media of your choice and find out why.

Your thinking will never be the same.

 Have a great day!

Michael

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Mason and His Best Buddies

My 18-year-old son’s name is Mason. I’ve been raising him since he was 6 years old and adopted him a few months after his father passed away 3 years ago. Mason has Autism and intellectual and developmental disabilities (IDD) and is non-verbal, speaking fluent gibberish. He is currently a senior at Hamilton High School in Sussex, WI, and is a loving, caring soul that has captured the hearts of all who know him. He loves HHS and is often seen wearing the hand-me-down and leftover football or basketball tee shirts that have been given to him. Every day he enthusiastically runs out the front door to start his school day.

This is Mason’s third year in Hamilton’s Best Buddies program. Best Buddies is an organization dedicated to establishing a global volunteer movement that creates opportunities for one-to-one friendships, integrated employment, and leadership development for people with intellectual and developmental disabilities. Hamilton High School welcomed Best Buddies during the 2015-2016 school year.

Mason was matched with Best Buddy Sam Herriges the first year, a young man named Erik the second, and a young lady by the name of Harper for the current school year. He has attended dances, school sporting events, and in general, hung out and watched movies, listened to music, or grabbed a burger at the local Culvers.

Mason, as is the case with many young folks with Autism or IDD, does not have the option of texting friends to meet up with them or simply ask to go hang out. Best Buddies has opened up that opportunity for Mason to expand his network and be with friends as any normal teen would. He loves cruising and singing with Sam and Erik while jamming to Fallout Boy’s Immortal, and swiping Erik’s fried cheese curds at Culvers. He is thrilled every time Sam calls him on FaceTime from college in Minnesota and is left with a long lasting smile. He’s not much to engage in meaningful conversation but the ear-to-ear grin and body “stims” speak volumes.

Best Buddies has turned out to be a great opportunity for Mason to socialize and do things he normally would be excluded from in high school. Next weekend he is off to another dance to enjoy another passion of his.

Mason, and so many others like him, thrive through this program but they need our help to continue to grow this to bring kids that used to be shunned and parked in back room of our schools out into the mix. To be a part of high school. To teach others how to interact with those with special needs. To simply be a normal kid when, in all actuality, many are not. Life will be long and hard for Mason with his disabilities, but his high school experience got immeasurably better when Best Buddies entered his life. Please consider helping spread this to all Wisconsin schools.

And many thanks to HSA Bank, a division of Webster Bank, for allowing me the opportunity to be of service to Best Buddies on this special day. Such a great and giving organization, one I’m proud to have recently joined.

BESTBUDDIES.ORG/GIVINGTUESDAY

How do you manage your calendar?

Summer is moving along at a fair clip so far. My July calendar is jam packed with activity and there sure is a lot going on.  Son’s birthday trip to Chicago, major tree trimming project, installation of hardwood floor, work travel, major seminar rewrites/presentation planning, listening sessions for my new Iron Maiden records, and a few days’ vacation at the beach are but a few things on my July plan.

Yet I am not overwhelmed.

The key here is planning. Today I will be looking hard at my Q3 plan to ensure it still fits into the bigger scheme then dialing in the week ahead.  With work life keeping me on the road and family/home life keeping me hopping, it is critical that I take the time to manage the plan.

I ask some basic questions. Where is the calendar or my time overextended?  Am I managing major projects with the proper amount of overlap?  Can I avoid being in two places at once?  Does my calendar align with my family’s?  Am I meeting the demands of my family and job well enough?  And am I leaving myself enough time for my hobbies and health?

My calendars cover 2 areas: family life and job life. I manage this in peaceful (usually) coexistence with my wife’s and my boss’s calendars and I use technology to do so.   Google Calendar has been a fantastic tool for my wife and me to juggle our schedules and fortunately, I am often able to plan my work travel around family situations that demand I remain local.  Likewise, I can plan my family activities around my work activities so I can handle the sometimes extraordinary demands of work.

The key is that I have to stay on top of it. I couple tips that help me do that:

  1. Long range planning – I look at the overall family plan and work plan over the next 6-12 months to get a general sense of where I need to be doing what. Work travel gets the edge here since I am covering 7 plants, 4 of which demand out of state travel.
  2. Medium range planning – This is my 3-6 months plan, generally. I fine tune my travel schedule with my family plan. This is where I lock in a contractor for a floor installation or plan to paint a bedroom.
  3. Short range planning – This is when the rubber hits the road and I start planning the specific hours and days for the next 1-3 months.  For example, this weekend we are taking the birthday trip, preparing and dropping our son off at a weeklong camp, clearing out the bedroom for flooring installation, installing the floor, getting a very large tree trimmed, putting the bedroom back together, and chilling the afternoon of the 4th rewriting my seminar presentations the remainder of the week.  All these activities over the course of 5 days require planning the hours and sometimes minutes.

I am a firm believer that many of us operate out of fear and when my calendar is in disarray and when I find myself hopping from one unplanned thing to the next and pissing people off in the process, my fear level goes up and things only get worse.

I urge you to take a look at your calendars. Use the technology, work together, and get shit done.  And remember to plan some time for yourself.

Thanks for dropping by.

Michael

Did I spell that right?

So recently I came across three examples of words misspelled in a public setting.  I know we all see this from time to time.

Yesterday, I came across two.  One was a car dealership in Burlington, Iowa that is listing on the large sign in front of their store advertising a Ford Ecsape for sale.  Oops.

The second was on LinkedIn for a digital image of a flyer stating “Acheiving Excellence….”

The third one I actually spotted a couple months ago and it threw me off a bit.  I had to look it up.  The word was on the sign out in front of a public library that had been promoting an essential oils class that was cancelled.  The word was spelled canceled.  I did not realize until I looked it up later that there are actually two correct spellings of the word cancelled.  Or canceled.  So I am giving the library the benefit of the doubt because perhaps the signage was intentional although I can’t be sure.  Maybe they just got lucky.  at any rate, I learned something from it.

The dealership and the LinkedIn post, however, are business-related and I guess my lesson here is that sometimes it matters.  Misspelling the word acheiving when used with the word excellence is not a good thing when promoting such things.  And maybe nobody noticed Ecsape other than me nor might it detract from someone buying the vehicle.

But it means a couple employees were less diligent than they should be and while these might not be critical errors, business owners might be asking what else are they missing that may be critical.

Thanks for stopping by.

Michael