Implementing Innovative Process Improvement & Lean Practices
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DESCRIPTIONImplementing Innovative Process Improvement & Lean Practices. January 23, 2014. Agenda. Introduction: Challenges facing the Public Sector Laying the groundwork for a successful implementation Developing well defined goals & objectives Team Selection Getting organizational buy-in. - PowerPoint PPT Presentation
Human Capital Productivity
Implementing Innovative Process Improvement & Lean PracticesJanuary 23, 2014
1AgendaIntroduction: Challenges facing the Public Sector
Laying the groundwork for a successful implementation
Developing well defined goals & objectives
Getting organizational buy-in1. Introduction: Challenges facing the Public Sector
Public organizations face at least five key challenges:
Creating a truly transformational government Meeting heightened constituent expectationsManaging workforce transitionsMinimizing the risks of implementing new technologies, and,Monetary issues, which are much more of operating realities that color all decisions, are the fifth challenge.
Lean manufacturing processes have emerged as a means to help break the politicized cycle and short term pressures32. Laying the Groundwork
LEAN THINKINGThe relentless effort to systematically reduce waste while improving the flow of value to the customer
Focused on eliminating wasteProvides principles, for improving workProvides levers to drive system improvements
2. Laying the Groundwork - The Six Overarching Principles & Practices:Partnership between supplier and producerFewer, better managed suppliersQuality at the sourceShared destiny relationshipsSupplier development
LEAN WORK METHODS Tactical shop-floor policies used to implement LeanService oriented productionStandard workVisual controlGood housekeeping/5S Set-up time reductionTotal Preventive MaintenanceEducation and developmentFlat organizationsDecentralized management
ORGANIZATION & CULTUREProgressive employee relations and change leadershipWorkplace safety Multi-skilled, flexible workforceWorker job securityImprovement incentivesU-shaped linesAutonomationLine stops and andonsError proofing PULL Everything produced at the rate of production of the final product -- pull production controlJust-In-Time production and delivery Linked production at Takt timeKanbansLevel schedulingMachines available on demand PURSUING PERFECTIONContinuous improvement attitude and empowermentKaizen events and continuous improvement Self-inspected quality, not inspected in quality Process ownership and responsibilityAdvanced quality concepts and measuresHardware Variability Control (HVC)Statistical Process Control (SPC)
SOURCING & SUPPLIER INTEGRATION FLOW Maximizing value by producing only what is desired in the shortest time possible with the least resourcesSingle piece flowPhysically and visually linked operationsConsolidated operationsSimplified and standardized processesSome lean operations principles and tools may not apply, but the methodology will identify and help you to eliminate waste, thereby making your value streams leaner52. Laying the GroundworkHowever, adopting Lean means getting past some of the misunderstandings and misperceptions surrounding Lean:Another management fad that will disappear within a yearCost cuttingHeadcount reduction Wont work in my area e.g. Engineering department
2. Laying the Groundwork
The Benefits of LeanThe percentage of patients being met within the target of 62 days rose from around 40% to 75-80%.A reduction in the average time to first appointment from 23 to 12 days.The average time taken for processing a planning application was reduced from 5 days to 2 days.A reduction in flow time of patients of 48%.More calls answered at first attempt (30% - 85%)More queries answered without the need for passing the customer to another department Cutting end-to-end time for adaptations to housing for disabled people from over 200 days to 12 days.Reducing payroll errors from 75% to 2%.Reducing backlogs in lost and found departments by 80%.Reducing the time taken in report preparation in the Justice system from 77 to 6 days.Source: International Public Sector Research & Case studies
73. Developing well-defined Goals & Objectives: Setting the StageWhat is the overall business challenge? What problems does the business need to resolve?
What is the local problem youre trying to resolve?
How will you measure this problem?
Did the solution work or not? 83. Developing Well-defined Goals & Objectives - Current State:Managers count the value added by an organization
Value added is the cost of inputs from outside the organization subtracted from the selling price (or fees, tax collected, costs recovered) of an organizations products and services.
But much of the value being added is actually waste: Rework, excess handling, excess processing, wait time, inventories (to be picked up, put down and stored), etc.93. Developing Well-defined Goals & Objectives Future State:We want to increase value and minimize waste, so what can managers and finance people do to count value and waste separately and more usefully?For a start, perhaps we can all start by talking about value created the useful activities in organizations from the standpoint of their customers- instead of value added which is the cost (including waste) plus recoveries and margins added by the provider. What managers need and want is a way to think about the future so a business can be managed & improved.This can only be done by creating, sustaining and improving better processes that engage the people actually creating value10Starts with an assessment of current performance where are we now?Seven Deadly WastesTIMWOODTransportationInventoryMotionWaitingOver-ProductionOver-ProcessingDefectse.g. Fire Inspection ServicesViolation OrdersSearching for information Defects/ReworkApproval Wait Time Meetings & Conference CallsValue-Added~35%Other3. Developing Well-defined Goals & Objectives - Current State:
3. Developing Well-defined Goals & Objectives: Current State
Client sets the expectation on how much of the gap they want to closeBench mark against best in classKCBs experience is that clients can recover a minimum of 50% of theNon Value Add activityOpportunityOpportunity12Facilities Management Services e.g.3. Developing Well-defined Goals & Objectives: Current State Supervisory Study - Facilities Management ServicesTypical Day-in-the-Life
Information space maps reveal complexity added to the value stream through inefficient system and data flows 3. Developing Well-defined Goals & Objectives: Current State 143. Developing Well-defined Goals & Objectives So what types of objectives should be developed that can help managers envision and and implement better processes that create more value and less waste?
Physical measures of the current state to spur improvement
Changes in these physical measures in the future state determined in the C step PDCA to confirm improvement?
153. Developing Well-defined Goals & ObjectivesLean goals & measures need to reinforce the new configuration of work and encourage the minimization of distance, friction, space and time.
Sample Lean MetricsCycle timesCustomer service levels (e.g., late orders, delivery performance)Total product throughput timeResources consumed per unit of outputResources employed per unit of outputInventory / working capital turnsReturn on assetsHand-offs in critical processesDistance parts/materials, travel% of workforce cross-trained4. Team SelectionCross-functional and include customers and suppliersPeople who have a stake in the value streamCustomers: e.g. Hospital Patients, Building owners (Fire Prevention Services)Suppliers e.g. Facilities maintenance, ProcurementPeople who actually do the workManagers who are prepared to go the gemba and roll up their sleeves (you may have to help prepare them)Ideally, people who are familiar with the PDCA cyclePlan, Do, Check, Act (See Appendix for explanation of the PDCA cycle)People whove had some exposure and training on the application Lean tools & techniques, in particularValue stream mappingObservations (Day-in-life) 175. Organizational Buy-in: The Roots of EngagementSo what is it that prevents an organization from implementing its Lean Strategy?
In our experience responses can generally be categorized into one of the two following gaps:
The first gap occurs when an organization tries to execute its lean strategy despite its people, rather than through them.
The second gap is formed by the organizations failure to create a process that clearly outlines how the strategy will be executed, and most important, connects the people to each other in that execution.185. Organizational Buy-in: The Engaged DifferenceSo:
How do we convince an entire organization to think and act differently?
How do we encourage those discretionary efforts so critical to success?
How do we get the full workforce to become engaged?
195. Organizational Buy-in: The Engaged DifferencePEOPLE WANT TO BE PART OF SOMETHING BIG.
PEOPLE WANT TO FEEL A SENSE OF BELONGING
PEOPLE WANT TO GO ON A MEANINGFUL JOURNEY
PEOPLE WANT TO KNOW THAT THEIR CONTRIBUTIONS MAKE A SIGINIFICANT IMPACT OR DIFFERENCE
5. Organizational Buy-in: An Engagement TechniqueOranging it: An innovative Problem Solving and Value Stream Improvement Technique
Michael Rosenberg Author of The Flexible Thinker