the six critical questions for driving enterprise alignment & lean culture
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TRANSCRIPT
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Six Critical Questions For Driving
Enterprise Alignment And Lean Culture
Presenter: Tracy O’Rourke
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2 2 Copyright 2013 Integris Performance Advisors
u What are the six critical questions?
u Why are the six critical questions important?
u How will these questions help organizations on the Lean Journey?
u What activities and tools help organizations answer the six critical questions?
Todays Session
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u Not started on the Lean Journey yet or less than a year?
u 1-4 years?
u On the journey over 4 years?
A Poll: The Lean Journey
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“The work of government is noble. The people of government are amazing. The systems of government are a mess.”
Ken Miller, author of “We Don’t Make Widgets”
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Train a bunch of “experts” – Lean Leaders, Green Belts etc. –
so they can solve all your problems.
An Approach That Is All Too Common
Creating A False Start
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Simplified Shingo House
CUSTOMER-FOCUSED RESULTS
ENTERPRISE ALIGNMENT
CULTURAL ENABLERS
CONTINUOUS IMPROVEMENT
The Four Dimensions of Lean Culture
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CUSTOMER-FOCUSED RESULTS
ENTERPRISE ALIGNMENT
CULTURAL ENABLERS
CONTINUOUS IMPROVEMENT
Every Dimension Connects Lean Principles
• Lead With Humility • Respect Every
Individual
• Create Value for the Customer
• Consistency of purpose
• Think Systematically
• Focus on Process • Assure Quality at
the Source
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An Integrated Approach to Implementing Lean
CUSTOMER-FOCUSED RESULTS
ENTERPRISE ALIGNMENT
CULTURAL ENABLERS
CONTINUOUS IMPROVEMENT
Each Dimension Supports the
Others, and is Built Upon the Others.
Real and Sustained
Lean Culture Requires An Integrated
Approach Across All Four
Dimensions
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Roadmap Example:
Timeline
Dim
ensi
ons
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This Session: Focusing on Enterprise Alignment
Having a Strategic Management
System aligns the entire organization.
CUSTOMER-FOCUSED RESULTS
ENTERPRISE ALIGNMENT
CULTURAL ENABLERS
CONTINUOUS IMPROVEMENT
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Why is Enterprise Alignment Important?
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Hoshin Kanri
What is it? A Japanese term Hoshin "compass needle“ or "direction". Kanri means "management" or "control"
Hoshin Kanri is two-fold: 1) A systematic planning methodology for defining long-range key entity objectives. These are breakthrough objectives that typically extend two to five years. 2) Managing the day-to-day work required to run the business successfully.
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Continuous Improvement Efforts
Plan
Do
Check
Act
The training first approach, can cause false
starts due to lack of planning
• Develop Vision • Develop Mission Statement • Create Organizational Values • Establish Outcomes, Goals and
Initiatives • Select Measures • Develop Scorecards, Dashboards • Filter and Prioritize Opportunities • Train Lean Leaders • Select Processes
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1 Who are we and where are we going as an organization? How do we measure performance against what’s important?
How are we doing?
How do we decide where to focus our efforts & allocate resources?
What actions do we take to improve our ability to achieve our desired outcomes?
How do we sustain improvements and ensure our efforts are making an impact?
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Six Critical Questions
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Question 1: Who are we and where are we going as an organization?
Vision, Mission, Values, and Outcomes, Goals Initiatives
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True North
u A Vision: What the future will look like and what the company will become
“What do you want to be when you grow up?”
u The Mission: a concise statement developed from the customer's perspective that answers three questions:
u What do we do?
u How do we do it?
u For whom do we do it?
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Organizational Values: Southwest
We operate with a Warrior Spirit,
a Servant’s Heart, and a Fun-LUVing
Attitude.
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Organizational Values: Toyota
Customer First: We forge partners with our customers and strive to exceed their expectations. Global Perspective : Learning from the best in the world, we aim to become the best in the world. Encouraging Teamwork: We recognize the human worth of each individual and collaborate to achieve Welcoming New Challenges: Unbound by convention, we embrace the challenge of creation. Encouraging Professional Excellence: We develop our strengths and think and act responsibly.
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Toyota knows that the key to successful Lean transformation
is culture…
…and culture cannot be copied.
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u Does your organization have values?
Organizational Values Reflection
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u Does your organization have values?
u If so, do employees breathe the values?
Organizational Values Reflection
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u Does your organization have values?
u If so, do employees breathe the values?
u Do leaders enforce the values?
Organizational Values Reflection
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“When I started my organization, nobody told me that half of my energy
would be spent building it, and the other half would be spent
protecting and defending it against all of the things other people wanted it to be.”
-Excerpt from Boundaries for Leaders By Dr. Henry Cloud
Commit & Defend Organizational Values
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How Do We Achieve the Vision?
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Clarity Map
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City of SeaTac Clarity Map
Key Measures • Resident satisfaction • Progress on City
Council goals • Community
engagement • Employee alignment • Employee capability • Employee engagement • Long term financial
stability • External financial
validation • Lifecycle cost of assets • Economic development
index • Compliance index
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27 27 Document Identifier
Clarity Map
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“The essence of strategy is choosing what not to do. ”
- Michael E. Porter
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Based on the organization’s mission, vision, values, goals and initiatives
Organizational Reflection
Stop Start Continue
What should the leadership team & organization STOP doing?
What should the leadership team & organization START doing?
What should the leadership team & organization
CONTINUE doing?
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Question 2: How do we measure performance against what is important?
Scorecards, Dashboards and Daily Management Boards
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Enterprise Alignment Implementation
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Organization
Department
Team
Individual
Measurement at the strategic level…
fuels measurement at the tactical level
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Enterprise Alignment Implementation
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Organization
Department
Team
Individual
Catchball helps engage employees and open communication lines
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Top Line Scorecard Sample
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Organizational Value Streams
Managing Change
Ensuring Compliance Manage
Technology
Lead Employees Manage
Finances Manage Vendors
EXTERNAL CUSTOMER
Map core processes, identify customers and key measures INTERNAL CUSTOMERS
Develop Products and Services
Sell Products and Services
Enroll Clients
Adjudicate Claims
Manage Relationships
Support Customers
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What Are Customers And Stakeholders?
Definitions:
u Customers: — User: Individuals or organizations who use or receive products, services from your process. Customers can be internal or external to the organization — Payer: Individuals or organizations who pay for your products and services (usually external customers)
u Stakeholders: — Any person or organization that has a stake or interest in the outcomes of a product or service, but is not recipient of these products and services, ie. policy interest
In many areas of government, processes are designed for stakeholders
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Core Process: Open Parks
Output Customer/ Stakeholder Requirements
• Ready to Use • Clean & Safe • Special Requests
completed
Customers: • Park Patrons • Sports Field Users
Stakeholders: • Maintenance (if safety) • Supervisor • Director
• Feel safe • Clean environment • Correct setup • Prepped field • Visually appealing
• Park use #’s • Revenue • Reputation • City Comparable
Customer and Stakeholder Requirements are not always the same!
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What is a Dashboard?
Dashboard – A visual scorecard with primary measures to be monitored on an ongoing basis
Create dashboards by process not by Department/
Function
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The goals of Daily Management Boards is to connect people to the processes they perform, communicate successes and issues in the work area and show goals versus actual performances.
Daily Visual Management Boards
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Tiered Metrics Connect the Organization
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Strategic Success √ Outcome Measures Day to Day Success √ Output Measures √ Process Measures
Organization
Department
Team
Individual
Balanced Scorecard
Process Dashboards
Daily Visual Management Boards
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Question 3: How are we doing?
Tiered Metrics Review
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u Create a sustainable review process
u Calendar and Implement the process
u Quarterly Review: Balanced Scorecards
u Monthly and/or Weekly Review: Process Dashboards
u Daily Review: Daily Visual Management Boards
Process and Metrics Review
These elements should be items included in the 18 month Roadmap.
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Question 4: How Do We Decide Where to Focus Our Efforts and Allocate Resources?
Project Types, Prioritization Tools
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u Prioritize Opportunities
u Filtering Tools
u Project Prioritization
u Allocate Proper Resources
u Portfolio Management
Organize to Mobilize
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What issues and opportunities align with strategic intent?
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u Revolutionary: Large breakthrough multi-year effort
u Evolutionary: Mid-size cross-functional efforts
u Incremental: Smaller day-to-day, quick hits and departmental improvements
Several Types of Organizational Efforts
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u Filter based on two factors — How much effort is needed? — What is the impact?
u Useful in screening and narrowing possibilities
Impact Effort Matrix
Low Impact High High
Effort
Low
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Plot each option on scales for Impact and Effort
Impact Effort Matrix
6.3
6.3
4.8
7.4 6.9
5.4
5.4
4.6 4.6
5.4
3.4
5.3 5.2
6.9 6.3
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 10.0
Ease
Impact
Ease & Impact Matrix 6.3
6.3
4.8
7.4
6.9
5.4
5.4
4.6
4.6
5.4
3.4
5.3
5.2
6.9
6.3
Project Name Impact1 SAM Cleanup 6.32 Pole numbering 6.33 HATS too slow 4.84 Service order cycle Time 7.45 Eliminate wait time/long lines at service centers 6.96 Invalid usage (unbilled) 5.47 Clean up existing Service Orders 5.48 Erros in HATS on Service Orders/MP Orders 4.69 Multiple Systems 4.6
10 WSAs BTC + External Customers 5.411 Directory Updates 3.412 Disputes Clean up 5.313 Out of service customer cleanup 5.214 DSL disconnection 6.915 Vibe disconnection 6.3
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Criteria Matrix
This matrix works well if project selection is dependent on multiple criteria
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Question 5: What Actions Do We Take to Improve Our Ability to Achieve Our Desired Outcomes?
Project Approaches, Project Implementation and Tracking
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What is Process Improvement?
Time spent working ON
the process versus working
IN the process
A Few Guidelines: • Focus on the process, not the people • Involve the people that work in the process • As a leader, don’t solve the problems for your people,
instead, help them grow a problem-solving muscle
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Determine the approach:
u Just Do It
u Gemba Walks
u Kaizen Events
u DMAIC Projects
Execute Process Improvement Efforts
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Tracking Progress
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Question 6: How Do We Sustain Improvements and Insure Our Efforts Are Making an Impact?
Process Performance, Process Adherence, Leadership Behaviors and Leader Standard Work
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The Three Legged Stool of Sustainability
Pro
cess
Per
form
ance
Lean Culture Sustainability
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Process Performance
Use Scorecards, Dashboards and Daily Visual Management
Boards to track performance.
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Questions:
u Does the process exist?
u Are employees adhering to the process?
u Is the process sufficient in meeting customer needs?
How?
u Managing at a glance – Visual Management
u Make problems visible – Expose process abnormalities
u Conduct Gemba Walks – Observe and ask
u Look for non-standard work, labor, inventory, and output
Process Adherence
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u Commit and Defend Organizational Values — What you create and what you tolerate is the culture
u Integrate the five practices of exemplary leadership — Evidence backed correlation to employee engagement
Leadership Behaviors
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u Integrate Lean Leader Tools/Leader Standard Work — Scorecard & Dashboard Reviews — Gemba Process Walks — Reflection Meetings — Daily Management Boards
Leadership
Primary Leader Role: Build the problem-solving muscle of your people
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Ownership For Sustainability
Who owns the three-legged
stool of sustainability?
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Driving Enterprise Alignment
CUSTOMER-FOCUSED RESULTS
ENTERPRISE ALIGNMENT
CULTURAL ENABLERS
CONTINUOUS IMPROVEMENT Aligns goals and measures throughout
the organization
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1 Who are we and where are we going as an organization?
How do we measure performance against what’s important?
How are we doing?
How do we decide where to focus our efforts & allocate resources?
What actions do we take to improve our ability to achieve our desired outcomes?
How do we sustain improvements and ensure our efforts are making an impact?
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Six Critical Questions
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1 Who are we and where are we going as an organization?
Balanced Scorecard Customer, Financial Stewardship, Process & Employee Outcomes
Process Dashboard Lead & Lag Measures
How do we measure performance against what’s important?
How are we doing?
How do we decide where to focus our efforts & allocate resources?
What actions do we take to improve our ability to achieve our desired outcomes?
How do we sustain improvements and ensure our efforts are making an impact?
2
3
4
5
6
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Enterprise Alignment Actions on the Roadmap
Timeline
Dim
ensi
ons
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Shingo House of Operational Excellence
CUSTOMER-FOCUSED RESULTS
ENTERPRISE ALIGNMENT
CULTURAL ENABLERS
CONTINUOUS IMPROVEMENT
Each Dimension
Supports the Others, and is Built Upon the
Others.
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Don’t say “ I can’t because…”
Say, “I could if…”
-Amy Besel
Department of Social and Health Services