lean 101 - lean fundamentals student workbook · 2020-06-15 · student introduction & team...

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Lean Fundamentals

Pulling Your Enterprise to Agility & Marketplace Leadership

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Lean Fundamentals

Pulling Your Enterprise to Agility & Marketplace Leadership

GR8PMTraditional Agile HybridTraining Coaching Consulting

Copyright, GR8PM, 2018, all rights reserved.

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Lean FundamentalsPulling Your Enterprise to Agility & Marketplace Leadership

Treasure Map (Course Outline)Introductions & Team Formation1. The Power of Pull2. Lean from the Beginning3. The Power of Flow4. Lean & Lean Principles

Invitation to Discovery

The Most Dangerous Words in Any Language…

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Step 1 – Join teammates in your Breakout Room.* Quickly choose a PM to facilitate your team.* Also choose a Time Keeper

Step 2 – Use your personal collage to introduce yourself.

* Keep in mind, this is not a comparison or competition. It is the first step to building professional friendships so be a good listener.* You will each have about 2 minutes. Taking other people’s time is a bad networking move!

Step 3 – Based on what you enjoyed about each other’s story, choose 2 teammates to share 1 area with the Large Group.

Step 4 – Rejoin the Group… on time!

Student Introduction & Team Challenge

TEAM CHALLENGEUsing the Car Companies List

worksheet, as a Team, make a subjective, non-scientific assessment and rank the

top 3, and the bottom 3, brands.

GuidelinesPlease do NOT do anything until I say “Go!”

You have 10 minutes to complete this.

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Treasure Nuggets & Prizes (Learning Objectives)1. Describe the foundations of Lean.2. Demonstrate the principles of Lean.3. Learn the time aspect of value.4. Summarize value stream mapping.5. Analyze what an effective value stream looks like.6. Compare management roles and their effect on

culture.7. Explain how to use PDSA for continuous

improvement.


Exciting Ideas in Any Language…

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Maximizing Today’s Value for You

Agile is accountability-driven. You must choose to be a constructive irritant… to yourself! Laszlo Retfalvi

“Great things in business are never done by one person. They’re done by a teamof people.” Steve Jobs

Learn by Doing!(us too!)

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Lean FundamentalsModule 1 –The Power of Pull

The Power of PullEvery required mistake must be made…

Understanding Lean• Toyota invested 30 years

developing the Toyota Production System (TPS).

• Lean thinking came from TPS.• 1950s = Kanban experiments• 1960 = Company-wide Kanban• 1970 = Supplier Kanban

Which Approach is the Most Rational?

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The Power of Pull

Organizations with “mature products” will not survive (much less thrive)

with an obsolete strategy!

Innovation linked to Product Evolution drives Success!

Age of

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The Power of Pull

Mature products must lower costs or increase perceived value to achieve profitability and survive!

Maturing Industries Face a Fundamental Changein the Cost-Price Relationship Driving Success!

Mature Industry: Customers & Competition = Price

COST

PROFIT

Price Customer Will Pay

Emerging Industry: Cost + Profit = Price

COST

PROFIT

Price Charged

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Understanding the DOT Simulation• Using Stickies and colored Dots, a

team of 4 SMEs, a Tester and a Product Owner are going to produce an outcome – As many correctly configured Stickies with Dots on them according to the specification.

• The specification requires each Sticky to have 6 Dots on it. One yellow in bottom left corner. One red in top right corner. Two green in the remaining corners. Two blue in the center, touching each other.

Leveraging DOT Game EvidenceEvery required mistake must be made…

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Understanding the DOT Simulation• An Expert Consultant has advised the organization that

having each SME working independently, on their task, as fast as possible, is the most efficient, and therefore best, process design choice.

• The process is designed in steps. First, the Product Owner creates a Lot (Group/Batch) with six Stickies on an 8.5 by 11 sheet of paper. Then passes it left to the first SME who completes their task and passes it to the left.

• The physical layout of the production floor has been arranged so each SME can easily pass completed Lots to the left following the production process. Each SME has an inventory of parts (Dots, Stickies, etc.). The Tester works as they receive completed Lots to be tested.


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Understanding the DOT Simulation• Each SME specializes in one color of Dots and cannot help

with other colors of Dots.• Each SME does their specific task as fast as possible on all

six Stickies before passing the Lot to the next SME and starting on the next Lot in their Inbox.

• Observers cannot talk, comment or send non-verbal messages. They are looking for process improvement insights.

• The work is executed in 5-minute Production Cycles (Rounds).


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Understanding the DOT Simulation• The “Manager” approaches the Team and says the

Customer is wondering why he hasn’t seen anything 2/3 of the way through the process.

• The Tester then shares all the completed Lots with the Customer who rejects them all as non-compliant.

• Then, for the first time, the Team asks, “What are you looking for?”

• Because only specific SMEs can correct/adjust the Dots positioning to meet the Customers expectation, the rework results in zero successfully completed Lots


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Questions to Consider:• What impact did the Specification have?• What bearing did performance pressure

have? How did it effect collaboration?• How did the “task focus” impact quality?• Would you describe the process as

“engineering-oriented” or “value-oriented”?• What difference might planning have made?• Energy of Compliance vs. Commitment?• Is it Simple or Easy?


Good people and good stuff got sucked into a defective process so failure occurred!

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Process VisualizationPrecursor to Improvement & Success

What is a Process1. Inputs – Tangible, Intangible, Human 2. Actions – Changes directed to a Result3. Outputs – As desired, or not

ACTIONSINPUTS OUTPUTS

PRODUCERSSUPPLIERS CUSTOMERS

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What happens to Process outputs?Customers accept or reject them.

• External Customers – Arms-length Value Exchanged• Internal Customers – Conditional Commitments Made

Customers needs drive the Inputs and Actions of the Process.

ACTIONSINPUTS CUSTOMERSOUTPUTS

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Process Management Guidelines• Processes underpin everything we do• Lean thinking is the foundation of

process improvement• Only understood processes can be

improved• Visualization makes processes more

understandable• Process Maps are organized

visualizations of all activities and their interrelationships

• Improving processes is the key to unleashing productivity

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TASK

ISSUE

INVENTORY or WAITING

A

B

C

QUESION or

DECISION

Process Management Guidelines• Begin with simple, easy to

interpret symbols• Use clear, connectors at right

angles (avoid ‘spaghetti’)• Map highest level with low

granularity, first• Drill down into lower layers and

add granularity, second

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Process Management Guidelines• Maps do not seek “right” answers• Maps do seek to accurately reflect reality• Maps are 2-D visualizations of 3-D realities• There are many ways to map even the simplest processes• Capture and communicate key process features is the goal• Adding unneeded detail to the map is waste

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Kanban – The Power of SignalsTransforming Processes from Push to Pull

Kanban Basics• Improves quality and lowers cost

• by eliminating delays • by managing WIP

• Visualizes work being done so:• standardized work definitions can be the basis for learning• constraints can be removed, feedback can be accelerated, and

efficiency increased

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PARTSIN

PRODUCTOUT

Operating Rules for Illustration• Only work if/when downstream task pulls• Pull signaled when downstream inventory equals zero

INVENTORY TASK #1 INVENTORY TASK #2

INVENTORYTASK #3INVENTORYTASK #4INVENTORY

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PARTSIN

PRODUCTOUT




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PARTSIN

PRODUCTOUT




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PARTSIN

PRODUCTOUT




TASKDONE

TASKDONE

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Kanban Basics• Kan (card) + Ban (signal)• Uses a Pull approach to

managing work • Creates visibility with signals

that start work• Kanban boards show Work-in-

Process (WIP).• .PMP ALERT – WIP is now

Work-in-Process not Work-in-Progress

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Pull Inhibitors… You Already Know

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Lean FundamentalsModule 2 –Lean from the Beginning

Lean from the BeginningTransforming the World Through Persistent Improvement

Simple Beginnings … Amazing Achievements!• The Toyota Production System (TPS) developed with

consistent, persistent, unyielding pursuit of perfection• TPS started as a Production Method and became a

Management System. Lean Thinking emerged from that management system

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Lean Thinking emerged from TPS• Lean is based on systems thinking• It is dynamic, knowledge-driven, customer-focused• It is people-centric, process-aligned• Lean integrates continuous value-creation and waste-

elimination• Lean requires continuous learning



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Lean became more than just what Toyota did• Lean evolved into a philosophy with principles and practices• Lean has been expanded to virtually all industries.• Lean is about building great organizations via learning• Lean is foundational to Disciplined Agile



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Lean Applies to Tangible, Intangible & Knowledge WorkTransformation via Waste Elimination

Team DiscussionTeam 1 & 4 = Tangible vs Intangible Team 2 & 5 = Tangible vs KnowledgeTeam 3 & 6 = Intangible vs Knowledge

Document & Deliver1. Write a definition for each Term.2. Compare (similar) and Contrast

(different) each term.3. Names of 2 types of items in each

category (i.e., not apple and orange, fruits and automobiles)

QUESTIONS?

Exercise GuidelinesPlease do NOT do anything until I say “Go!”

You will have 10 minutes.

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Lean Applies to Tangible, Intangible & Knowledge WorkTransformation via Waste Elimination & Continuous Improvement

Tangible Intangible Knowledge-Work

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Comparison of Lists of Lean PrinciplesAnd, yes, they all begin with, “The…”


Lean Principles for the Virtual World Persistent Improvement

5 Principles of Lean• Define Value.• Create Flow.• Establish Pull.• Pursue

Perfection.

6 Principles of Lean• Map the Value

Stream. • Flow Processes. • Make What is

Necessary. • Reduce Waste. • Ask Employees. • Continuous

Improvement.

7 Principles of Lean• Eliminate waste.• Build quality in.• Create

knowledge.• Defer

commitment.• Deliver fast.• Respect people.• Optimize the

whole.

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PMI List of Lean Principles

• Optimize the Whole• Systems-thinking looks at interactions across all of the value stream.

Value delivery and value realization goes beyond team-level Agile.

• Focus on Quick Value Delivery• Fast, incremental value feeds the learning cycle.

• Attend to Delays • Delayed value delivery is deadly. It obscures workflow feedback

reducing continuous improvement opportunities.

• Build Quality In• Inconsistent process quality breaks the “continuous” cycle.



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PMI List of Lean Principles (cont’d)

• Make Decisions Where the Work is Done • People at the “gemba”, doing the work, need to be able to make

decisions about the work.

• Guided Continuous Improvement • Lean principles enable ‘guided’ continuous improvement.

• The Role of Management • Lean-management creates an environment for teams to be awesome.

Teams look across the system with a holistic view to achieve quick value delivery.



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Lean Strategy before Six Sigma Process Improvement• Starting with Six Sigma risks improving a process that

should not exist in the first place.


Lean Extension to Six SigmaSix Sigma Specialization

PROJECT IRIDIUMDeployment:• 72 Satellites; 12 mo. & 12 days• 3 Countries, 3 Launch Vehicles• 14 Satellites each, 13 days• 22 consecutive successful launchesManufacturing:• Cycle time = 25 days vs. Industry avg

= 12 – 18 mo.• Dock-to-Dock rate = 4.3 days

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Lean Strategy before Six Sigma Process Improvement

• Six Sigma (6σ) is a set of process improvement techniques and tools.

• Developed by engineer Bill Smith at Motorola in 1986.

• Jack Welch made it core to General Electric’s business strategy in 1995.

• Six Sigma (6σ) can be referred to as 6S.



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Comparing Lean & Six Sigma (6σ) • Motorola focused on systematically improving quality, by eliminating

defects, to improve results. • Six Sigma is a data-driven method to dramatically improve the quality of

products and services, and thereby increase customer satisfaction.



OBJECTIVEMETHOD

FOCUS

PRINCIPLES

SIX SIGMA (6σ)Deliver Customer Value

Reduce VariationProblem Resolution

• A problem exists.• Improved process quality across the

enterprise via reduced variances fixes it.• System output increases as input

variation decreases.• Numbers and analysis are valued.

LEANDeliver Customer Value

Remove WasteFlow Improvement

• Optimize flow and eliminate waste to improve business performance.

• Many small improvements, via the PDSA cycle with many small experiments is better than numerical analysis.

• Lean and Six Sigma are synergistic.• Lean Six Sigma is a unified framework.

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Does Inspection Add Value?



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Six Sigma (6σ) Lexicon1. Muda (waste)

• A common lean mantra, “Eliminate waste” is only the first focus.

2. Mura (unevenness)• Mura causes Muda. Unevenness causes workflow delays, a waste.

3. Muri (overburden)• Overburden causes multi-tasking, waiting on others, delays in

workflow, and waiting for feedback driving unsustainable quality.

4. Gemba (workplace)• The place where the work is actually being done.

5. Genchi genbutsu (going to [the gemba]) • The act of going to the gemba to observe the actual work being done

and talk to the actual people doing the work.



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Lean in the Enterprise• Every enterprise is now part of a complex global web.• Understanding your position is required to improve it.


Lean Extension to the EnterpriseEnterprise Specialization

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Lean application to the Enterprise• Lean applies to every production and life-cycle process that

delivers value to the customer and revenue to the enterprise.• Lean applies to enabling leadership and infrastructure

decision-making process required to direct programs to deliver value.



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Lean application to the Enterprise – Healthcare • Lean applies to treatment and all other life-cycle processes

that deliver value to the patient and revenue to the enterprise.• Lean applies to enabling leadership and intervention-vs-life-

style-choice investment decision-making process required to optimize the delivery of value.



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Minimum Viable Product (MVP)• The smallest piece of work used to validate a hypothesis

about a potential product.• Geared towards:

• Startups• First-time product / service release• Small team builds that can pivot / adapt

• Challenges for:• Established companies / business units• Existing product / service enhancement(s)• Dedicated teams not aligned to build it


Lean Integration to the Disciplined AgileDisciplined Agile Utilization – Minimum Business Increment (MBI)

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Minimum Business Increment (MBI)• Minimum amount of business value that can be built and

deployed, or consumed, sensibly from business’ perspective.• Unit that contains all required pieces for value realization.• Useful when Epic is too large and Feature is too small to size

item to be built, deployed and realized.• MBIs are containers:

• What’s of value?• Who builds and releases?• How is value realize?

• Note: MBI is expansion of Denny and Cleland-Huang’s Minimum Marketable Feature but not SAFe’s MMF.



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Minimum Business Increment (MBI) Discussion

Consider a project where, after it was over, you realized:

• You could have delivered smaller “stages” sooner.

• You could have built it incrementally.

• Doing that to verify and validate the design would have been a value-added outcome.

QUESTION: How would starting with an MBI have improved the customer’s perceived-value?



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Minimum Business Increment (MBI)


GR8PM’s Contribution

Minimum Viable Outcome (MVO) is the product or service or option with sufficient features to satisfy Early Adopters and entice the Early Majority.

Minimum Marketable Feature (MMF) is a small, self-contained item that has value to both the organization delivering it and the Stakeholders using it.

Features, Functions and Capabilities (FFC) are “natural” groups, such as engine, transmission, and differential for automobiles, can be intelligently fragmented into more detail as the workflow progresses, providing transparent inspection that aids discovery, adaptation and innovation.

Minimum Viable Product (MVP)

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Lean FundamentalsModule 3 –The Power of Flow

Document & Deliver1. A Process Map for Subway Sandwich

Artists with 11 steps to the Perfect Subway Sandwich.

2. Use the Exercise - Power of Flow file provided.

3. Choose:• a Tech Writer to document and send

the file.• a Spokesperson to describe the

Team’s process documentation.

QUESTIONS?



The Power of FlowValue Streams that Drive Business Agility and Success

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Make Value Flow (to Customers, User and the Enterprise)Creating Flow• Focus on WHAT is flowing through the process / stream

• Tangible = Materials • Intangible = Information• Knowledge Work = Innovation• Services = People

• Challenge organizational boundaries• Eliminate bottlenecks, minimize buffers

• DISCUSSION• At Subway, what are the bottlenecks? the buffers?• In healthcare, what are the bottlenecks? the buffers?• Why do we want to eliminate and minimize them?



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Time is a vital metric for improving flow• There are different ways to

measure time• Wait time• Processing time• Cycle time• Customer Demand or Lead time

• It is critical to know how time is being measured



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Wait Time• The time Work in Process (WIP) is idle it is in

• Queues – Time spent waiting for activity to begin• Buffers – Time spent suspended between each operation in

a production process; think of tangible parts stores and intangible in-boxes.

• aka Queue time or Delay time



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Processing Time• The time that activities are being performed on WIP• It may consist of

• Value Added Time (VAT)• Transforms inputs, correctly the first time, into customer desired

outputs.• Non-Value Added Time (NVAT)

• Customer Value is not created. May be necessary (e.g., infrastructure or compliance) or pure waste (e.g., wait time, rework or excess).

• VAT and NVAT labels can describe the quality of• Touch Time (TT)• In Process Time (IPT)• Response Time (RT)



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Cycle Time• The time required to execute activities in a process• It can be measured for:

• A single task or activity• A group of tasks or activities• A single process• A group of processes (e.g., customer order to delivery)

• Cycle time includes processing and wait time. • Other names: Lead time, Span time, Throughput time



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Interpreting Time Measurements



(A)

(B)

(C)

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Interpreting Time Measurements



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Time Value Charts• Visual display of time composition / elements for a process• Numbers may be actual (measured) or estimated



Time is $$!!Removing Wait and NVAT for a process produces big cycle time

savings … and potentially huge costs!

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PUSH Systems• Typically built in batches• Each activity delivers its

output independent of demand

• Results go into Inventory• Inventories hide defective

goods• Inventories suffer

obsolescence when customer demands drive design changes

• Inventories trap $$



PULL Systems• Each activity creates output “as

needed” for next production step• Production triggered by demand

(external or internal)• Production flow is smooth• Minimizes Inventories

• Reduces defect rework• Frees capital $$ for other uses

• Little inherent waste• Responsive to customer required

design changes without financial loss

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Creating Pull-Activated FlowPredictable cycle time enable Pull-Activated Flow. It uses: • Takt time• Balanced work• Standard work• Single piece flow• Kanban systems• Just in time (JIT) material and information delivery



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Creating Pull: • Start with the Customer and design the workflow

system backwards to the beginning• If cycle time is < or = to customer expectation time,

then Pull can be accomplished• If cycle time is > customer expectation time, then

buffers (inventory) will be required for Pull to be accomplished

• Alternately, System design could be altered to reduce cycle time so it is < or = to customer expectation time

• Financial analysis can determine if / when to choose an option or invest to transition to the other option



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Takt Time – Measure of Customer Demand• Takt Time – A reference number for a process cadence• From German “taktzeit”

• Takt means “stroke”• Zeit means “time”• For example, drum beat for a marching band



Takt Time =Available Time

Customer Demand Ratefor Available Time

Takt Time Example:Available Time = 1 Year (220 days)Customer Demand = 40 Units

Takt Time = 222 / 40 6 Days (5.5)≈

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The Power of Flow – Exercise #2

Document & Deliver1. Using the Exercise – Power of Flow

02 file provided, analyze the process flow on page 1 and complete the 3 Steps on page 2.

2. For STEP #1 you will assess the VAT or NVAT condition of each process step.

3. For STEP #2 you will identify and describe 3 areas of waste.

4. For STEP #3 you will use the Assumptions provided and calculate several values for CT, VAT and NVAT.

QUESTIONS?



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You Can’t Improve a Process You Can’t See

• Lean is not a set of tools.

• Lean is continuous improvement cycles

• Lean is achieved through continuous PDSA cycles


The Power of FlowDisciplined Agile Utilization – Guided Continuous Improvement

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Lean FundamentalsModule 4 –Lean & Lean Principles

House of Lean & Lean PrinciplesParadigms, Lexicons & Perspectives

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PMI’s Lexicon of Lean Principles1. Optimize the Whole2. Focus on Quick Value Delivery3. Attend to Delays (Queues and Pull)4. Build Quality In5. Make Decisions Where the Work is Done6. Guided Continuous Improvement7. The Role of Management


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PMI’s Lexicon of Lean Principles1. Optimize the Whole

• Organizations are complex adaptive systems that require systems-thinking. Reductionist thinking does not work.

• Interactions within the value stream impact value delivery.• Optimizing a team while sub-optimizing value realization, is not agility.

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PMI’s Lexicon of Lean Principles (cont’d)

2. Focus on Quick Value Delivery• Be quick, or be dead! We’re in the Age of FAANG!

3. Attend to Delays (Queues and Pull)• Delays are deadly. • Beyond delayed value realization, when work waits it cascades into

unplanned work and more delays. • Ultimately, that complicates understanding feedback reducing

continuous improvement opportunities.

4. Build Quality In• Inconsistent process quality breaks the “continuous” cycle.• Lack of quality creates an endless loop of rework.• How a product / service is produced affects the Customer’s

perceived value.


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PMI’s Lexicon of Lean Principles (cont’d)

5. Make Decisions Where the Work is Done• People at the “gemba”, doing the work, need to be able to

make decisions about the work.

6. Guided Continuous Improvement• Lean is about continuous improvement. • Disciplined Agile is about guided continuous improvement

with Lean principles supporting decisions.

7. The Role of Management• Lean-management creates an environment for teams to be

awesome. • Teams look across the system with a holistic view to

achieve quick value delivery.


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The goal of business agility is the realization of the highest business value in shortest amount of time, consistently, sustainably, and with high quality. • Business value created by customer-value focus.

• Consistently delivered work improves the probability of predictable customer-value delivery.

• Sustainably designed and developed with sustainably-paced effort.

• Quality in the product design and build as judged by the customer.

Small increments, continuously adjusted to what is needed, delivered quickly, enables marketplace adaptation at the lowest cost.


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Lean’s “Magic Pixie Dust”• Continuous Improvement• Eliminate Waste• Respect People


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The MBA’s Guide to Enterprise Agility Moving Beyond Scrum Into Scalable Agile Practices

GR8PM, Inc.Training Coaching Consulting

Connect with me on Linked In

or via email for a copy of

this presentation or info on the Mastermind Group

[email protected]

ComingWinter2020

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Pull Inhibitors… You Already Know• Handbacks• Delays in

• Feedback• Other’s Input• Customer-furnished Input

• Hidden work• Lack of visibility• Lack of transparency

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Lean Applies to Tangible, Intangible & Knowledge WorkTransformation via Waste Elimination & Continuous Improvement

Tangible• Overproduction• Inventory• Waiting• Transportation• Motion• Excess Processing• Under-utilized talent

Intangible• Unneeded analysis/tests• Deficient reports• Overcomplex validations• Delayed decision making• Delayed information

source• Unneeded features• Excess processing• Deficient processing • Under-engineered

solutions• Over-engineered solutions

Knowledge-Work• Creating unneeded

features • Issues in partially done

work• Stop and Go multitasking• Unplanned work• Lost of information. • Shifting value stream

focus• Incompatible assumptions• Deficient research • Deficient preparation • Rework due to regulatory

changes

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lean 101 - lean fundamentals student workbook · 2020-06-15 · student introduction & team...

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