Upside vs. Downside

From Seth Godin’s blog:

How much of time, staffing and money does your organization spend on creating incredible experiences (vs. avoiding bad outcomes)?

At the hospital, it’s probably 5% on the upside (the doctor who puts in the stitches, say) and 95% on the downside (all the avoidance of infection or lawsuits, records to keep, forms to sign). Most of the people you interact with in a hospital aren’t there to help you get what you came for (to get better) they’re there to help you avoid getting worse. At an avant garde art show, on the other hand, perhaps 95% of the effort goes into creating and presenting shocking ideas, with just 5% devoted to keeping the place warm or avoiding falls and spills as you walk in.

Which is probably as it should be.

But what about you and your organization? As you get bigger and older, are you busy ensuring that a bad thing won’t happen that might upset your day, or are you aggressively investing in having a remarkable thing happen that will delight or move a customer?

A new restaurant might rely on fresh vegetables and whatever they can get at the market. The bigger, more established fast-food chain starts shipping in processed canned food. One is less reliable with bigger upside, the other—more dependable with less downside.

Here’s a rule that’s so inevitable that it’s almost a law: As an organization grows and succeeds, it sows the seeds of its own demise by getting boring. With more to lose and more people to lose it, meetings and policies become more about avoiding risk than providing joy.

Truth in Advertising – Refreshing

more about "Truth in Advertising – Refreshing", posted with vodpod

Great Innovators Spend Less Than Good Ones

from HarvardBusiness.org by Scott Anthony

A story last week about the Obama administration committing more than $3 billion to smart grid initiatives caught my eye. It wasn’t really an unusual story. It seems like every day features a slew of stories where leaders commit billions to new geographies, technologies, or acquisitions to demonstrate how serious they are about innovation and growth.

Here’s the thing — these kinds of commitments paradoxically can make it harder for organizations to achieve their aim. In other words, the very act of making a serious financial commitment to solve a problem can make it harder to solve the problem.

Why can large commitments hamstring innovation?

First, they lead people to chase the known rather than the unknown. After all, if you are going to spend a large chunk of change, you better be sure it is going to be going after a large market. Otherwise it is next to impossible to justify the investment. But most growth comes from creating what doesn’t exist, not getting a piece of what already does. It’s no better to rely on projections for tomorrow’s growth markets, because they are notoriously flawed.

Big commitments also lead people to frame problems in technological terms. Innovators spend resources on path-breaking technologies that hold the tantalizing promise of transformation. But as my colleagues Mark Johnson and Josh Suskewicz have shown, the true path to transformation almost always comes from developing a distinct business model.

Finally, large investments lead innovators to shut off “emergent signals.” When you spend a lot, you lock in fixed assets that make it hard to dramatically shift strategy. What, for example, could Motorola do after it invested billions to launch dozens of satellites to support its Iridium service only to learn there just wasn’t a market for it? Painfully little. Early commitments predetermined the venture’s path, and when it turned out the first strategy was wrong — as it almost always is — the big commitment acted as an anchor that inhibited iteration.

These ingredients are a recipe for sustaining thinking — trying to leap-frog over existing incumbents with cutting-edge technologies. Research shows that market leaders tend to beat back these kinds of attacks, resulting in a lot of squandered resources.

So what should leaders do?

Be frugal with financial resources but generous with human resources. What holds disruptive innovation back in most organizations isn’t a lack of money. It is a lack of committed people, a surplus of inappropriate mindsets, and a whole series of standard operating procedures that run counter to the fast-cycle decision making, in-market learning, and iterative approach to strategy required for disruption.

Freeing people to fully engage in this problem, and having leadership focus their energy on helping to ward off what I call the “sucking sound of the core” can be critical to success.

In an interview with Innosight, Intuit Chairman Scott Cook said that in his experience, the most successful disruptive teams have “an executive that is rooting for them, cheering them, mentoring them, actively spending time with them every week and protecting them from the antibodies of the rest of the companies that are trying to love them to death, or, exterminate them.”

Signing checks is easier than spending time. If you are truly committed to innovation, though, spend less money and more time. You’ll end up making substantially more progress.

Helping Teams Advance One Gemba at a Time

from DailyKaizen by Lee Fried

Most frontline teams in my organization are not used to being asked to improve their own process.  Like most organization in transition most improvement that has taken place in the organization in the past was management driven and usually owned and executed by outside experts like consultants and project managers.  As we transition into a system where teams are asked to be responsible for improving their processes every single day one of the most powerful tools management has is the gemba walk.   There are many reasons why the gemba walk is not only an important tool, but an essential tool in a Lean transformation.  Here are just a few:

• Gemba walks are one of the most important methods for teaching management Lean.  It takes Lean out of the conceptual world and forces management to learn by doing. 
• Gemba walks demonstrate a behavior change from management.  It shows that management is curious about the work and interested in seeing the real problems.   Early on they also demonstrate to the teams that everyone is in the change together.  Management is learning alongside the teams they are coaching.
•  Gemba walks allow management to begin to understand the problems that they create and forces them to begin to take responsibility for solving the gaps in their management system.  They see firsthand the challenges created by unclear or too many priorities, silo thinking, narrow job classifications, etc.    
• Gemba walks teach leaders how to set clear expectations and have the discipline to follow-up to see progress.  In order to do this effectively the manager must understand the content of the work; know how to see problems, and to know how far a team can improve over a set increment of time. 

In several post in the past I have talked about some of the advice I give leaders as the learn how to effectively lead gemba walks.  As my own experience has grown some of my thinking has advanced.  Here are a couple of tips that I hope help:

• Gemba walks can only be effective if leaders are disciplined, consistent and organized.  This is why having management standard work is so important.  In our organization we create visual systems (Kamishibai boards) that track adherence to management system work to help reinforce this discipline.   These boards track the frequency, sequence and content of what should be checked during each gemba walk and clearly make visible that the walks are happening as scheduled.  As managers build these boards they need to determine how often they will visit each team (less frequently the higher you are in the organization), and then the board makes it transparent to the teams how often they can expect a visit thus reinforcing the management responsibility.
• Early on it is important to have some coaching help during gemba walks.  It is nice to have a Sensei to go with you, but it is also effective to walk with a leader that has more experience then you do if a Sensei in not available.
• During each walk a leader should ask the team a series of open ended questions to assess the current situation, challenge the current thinking and prepare the team for taking the next step.  If you are just getting starting it is very helpful to have a set of standard questions you always ask the team as well as a system to track notes from past gemba walks.  The leader should take the time to review their notes and prepare their questions so that they respect the time of the team.
• Gemba walks and visual management go hand and hand.  Without visual systems gemba walks often end up being disorganized, not focused on data and worst of all they turn into PR visits or complaining sessions.  Gemba walks are probably the most important tool in helping set and maintain the expectation that teams make their processes visible.
• Finally, at the end of each gemba walk the leader should summarize what they and the team has learned and then clearly define the follow-up items that the team and the leader need to resolve.  Often the due date will be during the next gemba.  This is the most powerful part of the gemba, because when done effectively it helps move the team to the next level of improvement and at the same time gives leadership credibility as the leaders solve some of the systems problems that get in the teams way.   In order to do this well a leader needs to have a system to track on follow up items.  If they ask a team to try x by y date the leader better show up to check or they will lose credibility quickly.  When they do show up to check on the follow up just like they said they would teams start to see that management is serious and they will invest the appropriate time in the improvement activities moving forward.  Something very important as teams begin to learn how to improve their own processes.

Power of a great story

Brilliant Management – “you put in the details”

Why Google and Apple Win, and You Don’t

“

How to Be Lean in a Batch Production Industry

How to Be Lean in a Batch Production Industry: “
Faisal asked:

How to use lean in batch production industry? Most of the time I hear customers saying ‘lean is for mass production companies and not for us.’

This is a common question and one worth shining some light on. The simple answer to this is, ‘By engaging the creativity of people in continuously reducing waste and improving customer satisfaction.’ But first it’s important to understand that lean is not all about one piece flow, cellular manufacturing, takt time and cycle time line balancing and kanban systems. These make up the just in time pillar of the Toyota Production System and play a very important role in setting the pace of work, exposing problems and driving down costs associated with inventories and delays. However just in time as a system relies on many other lean practices, all of which can exist and give benefit to batch production industries even when just in time is not being practices.

Here are some suggestions on how to be lean in a batch industry:

Engage people. This is really a basic condition for whatever lean and continuous improvement system you apply within a process industry. If you do nothing else, do this. Without maximum engagement of people and their creative ideas, you can’t call it lean.

5S. Any workplace can benefit from getting rid of unnecessary items (1st S), putting everything needed in its proper place (2nd S) and setting and maintaining a high level of cleanliness.

Visual management is enabled by good 5S as well as the placement of simple visual tools to identify target, actual and a root cause analysis of any gap between those two. It is important to note that ‘management’ is half or more of visual management. It requires the behavior of leadership at all levels to go see the situation on the production floor in order to address the problems that have been surfaced. This method alone can take a batch production industry a long way towards lean.

Practical problem solving. The PDCA cycle of improvement doesn’t care whether you are baking croissants, giving out flu shots after flu shot at a clinic or building custom fire trucks one at a time. The practical problem solving process is the glue that brings various lean tools together, brings people together in teams and engages them in thinking about their work and how to improve it.

Set up and changeover time reduction. Most batch processes are in batch mode rather than small lot or one piece production due to changeover times that are long in comparison with run times for one piece. Whether or not you choose to reduce changeover times and reduce batch sizes (and lower inventories) or whether you use changeover time reduction to increase capacity, single minute exchange of dies (SMED) is a lean tool that will help.

TPM is the classic umbrella system most often seen as the favored ‘lean for process industries’. Within TPM there are some very specific and practical improvement methods, including all of the above, that are geared towards equipment-intensive industries.

Energy savings. Batch processing industries tend to have long process cycle times, use a lot of heat, water, gas, steam, electricity and other sources of energy. A structured program of auditing and metering energy use, with team-based energy treasure hunts are another way to boost lean activity in a batch production industry.

Error-proofing. Within any of the countermeasures or improvement activities above, there are opportunities to error-proof the process. This can be as simple as manual process in which people set off alarms (andon) when they note a problem, to automatic detection along packaging lines using electro-mechanical sensors, to physical modifications to equipment or tooling so that incorrect installation is impossible.

The production preparation process (‘3P’) is a great way to transform batch equipment into equipment that is smaller, has lower capital cost, lower running cost and can accommodate quicker changeovers and smaller batch sizes. Essentially PPP is understanding and applying as many of the above (and more) lean principles at the early stages of product and process design so that you can use kaizen to improve continuously, rather than to correct design flaws.

Curious to learn more about any of these lean practices? First I encourage you to use the search field at the top right of this blog to find related articles. You can also go directly to the archives and browse titles of the past 900+ articles. Once you’ve exhausted those options, feel free to ask Gemba. Thanks always for reading.

By Jon Miller – September 22, 2009 4:39 PM”