HOW TO MANAGE YOUR LEAN INITIATIVE

A Proven Path To Success: The completion of this deep three-part series lists and examines the details behind project selection, project management and project team functions.

Last month we discussed the qualifications and role of the World Class Programs Coordinator and suggested an approach for selecting outside consulting and support resources. This month we conclude by continuing our treatment of how to plan and execute a successful Lean/continuous improvement program. More specifically, we will address:

• Project selection
• Project management
• Project team functions

In terms of Figure 1, our anchor graphic for this series, we will be discussing the box entitled “On-Going Projects.” To restate our purpose, we seek to detail a proven approach to launching and managing a Lean initiative that will result in World Class performance.

DECIDING WHAT TO WORK ON
Especially in the early stages of the Lean implementation, decisions about what to change will be critical. Meaningful change will require the commitment of time, money and other resources, and nothing will stall out or defeat a program faster than projects that fail to deliver an adequate return on this investment. The goal is to bring about early changes that will help to convince all of the key players in the organization that Lean offers a powerful collection of performance improvement tools.

With this in mind, it is useful to have at hand a specific method for identifying worthy projects. The following sources will almost always yield a “shopping list” of projects rich in potential for reducing cost and improving customer service:

1. What is often called “The Voice of the Customer” should be the first area to be searched for improvement opportunities. The data may come from formal surveys or less structured information coming from those who interact routinely with customers. A thoughtful and objective review of customer feedback will suggest many opportunities for projects focused on eliminating the causes of customer dissatisfaction.

2. If we have mapped our value streams carefully, we will have identified the major drivers of excessive lead time, inventory, defects and poor productivity (see “Value Stream Mapping“, Lessons In Lean, September 2008). On the value stream maps we will have placed Kaizen “bursts”close to the nodes in the value stream that require improvement. The projects indicated by these Kaizen bursts will be added to our shopping list of projects.

3. Another useful indicator of the need for improvement is a formal Lean assessment. There are a number of Lean maturity models that measure the status of the organization’s ability to manage the Lean/continuous improvement implementation process as well as their accomplishments to date. An Internet search should turn up the alternatives.

Properly done, the assessment will identify weaknesses in the improvement infrastructure and spot opportunities for strengthening knowledge and skills related to Lean tools and other improvement techniques. Some consulting firms assist with the assessment, thereby bringing an outside perspective, and also offer certifications when high level assessment scores are attained. In any event, these evaluations give rise to projects with great potential for bettering the company’s business processes.

4. Yet another important means of comparing performance to a standard of sorts is the process of benchmarking. This approach involves some front-end research to identify companies who are noted for their prowess in certain areas of performance or Lean tool application.

For example, some may have particularly effective plant arrangements, others may have very successful setup reduction campaigns, and still others may have capacity management and scheduling tools that ensure high levels of on time delivery. By matching the strengths of other companies with our perceived weaknesses, we can learn how to better address our deficiencies. Most companies are happy to exchange visits and information on a reciprocal basis.

The learning from our benchmarking visits will likely spawn another cluster of projects with significant improvement potential.

5. One last source of project activity must be mentioned. At any given time, the company will likely have some strategic initiatives in motion. These endeavors will bring added capacity, new process technology, new customers, new systems, or other major changes in the company’s capabilities. We will want to examine the projects required to support these programs to ensure that they are “Lean compatible”, that they are not at odds with Lean principles and, in fact, we will often adjust the scope of the projects to include Lean elements.

Most importantly, we must insert these projects into the mix so that we do not overburden available resources. It then remains to judge the merits of the many projects that will vie for inclusion in the program line-up. This is perhaps the most important function of the Steering Team. More often than not, prioritizing projects is a collective judgment call. Market knowledge, experience and wisdom are the keys to selecting projects with the greatest promise for impacting positively on the economics of the business.

A word of caution is in order here. There is a tendency for fledgling Steering Teams to select early Lean projects that are “sure-fire” winners, meaning they are low risk and easy to do. The problem with such projects is that when they are done, no one is impressed. They don’t affect the bottom line, people don’t learn a great deal from them, and they fail to motivate the organization to go forward with Lean. Lean tools can drive tremendous, beneficial change. Why not use them to solve major problems or capitalize on some important business opportunities right from the start?

PROJECT MANAGEMENT
Once the projects have been listed and prioritized, it is useful as a first step to categorize them, put them on a rough timeline and make them visible to all. The best technique we have found for visibly posting a summary of a multi-year program is the Transformation Map, or briefly, the T-Map. Figure 2 is a conceptual view of a T-Map (the actual map is poster size and much too large to render here.)

The T-Map performs a number of functions. First, it requires that the Steering Team write an Operations Mission that reflects corporate strategic demands. Next, functional managers or T-Map segment owners write 3-5 year goals that are supportive of the Operations Mission. Managers then list the broad initiatives that will be needed to achieve their stated goals, and projects from the prioritized list mentioned above are slotted into the appropriate segments, the appropriate initiatives and the desired time frames, where the time frames are indicated by the concentric circles on the map. If a project doesn’t fit into a specific initiative and therefore doesn’t support the identified mission and goals, it should probably be dropped or deferred. This is a good second test of a project’s worthiness.

When completed, the T-Map represents the best thinking of the company’s leaders with respect to how they will add to the organization’s capabilities in support of a set of strategic goals. With this focus, Lean is no longer a stand-alone program. Lean tools, and the culture that accompanies their application, become an integral part of the quest for an arsenal of superior competitive weapons.

Segment owners will sometimes delegate responsibility for a “spoke”, or major initiative on the T-Map, and in turn, spoke owners will assign projects to other individuals. In this way, a measure of accountability for the execution of the program is assured. This accountability is captured, along with other important data, on a spread sheet that will be used to track the status of each project on a routine basis. This spread sheet is the focal point of every Steering Team meeting agenda.

With the broad level plan documented on the T-Map and the accompanying status report, attention can be centered on defining and successfully carrying out each project. A very useful tool for setting up a project is the scope sheet shown in Figure 3. Completing this document demands a thorough analysis of the project and careful documentation of the requirements, including:

• A description of the project
• A definition of the problem to be addressed
• The objectives to be met and expected deliverables from the project
• The project team make-up, including the team leader and an alternate
• Supporting personnel
• The date, time and place of the event, or the team meeting place if it is an extended project
• Key process information required to complete the project

Some projects are of a scope and magnitude that require more extensive project charters, but this simple one-page plan will suffice for most Kaizen events and smaller projects. A key point here is that a project should never be authorized or undertaken without first generating a scope sheet. Poor definition is the most common cause of project failure.

The Steering Team is actively involved in every level of the planning, including a review of the scope sheets for proposed projects. Then, when a project is launched, the Steering Team follows its progress and intervenes as needed to insure success. In the case of short term Kaizen events, Steering Team members make it a point to participate in selected events from time to time.

BUILDING THE PROJECT TEAM
Assembling a great project team is akin to fielding a winning sports team. We will populate the team first with people who are knowledgeable of the processes to be improved. They are nearly always drawn from the natural work group, the people who apply the process on a day-to-day basis. To this group we add specialists such as engineering, quality and systems professionals who bring specific expertise related to the problem to be solved. In the early stages, teams may also include consultants and facilitators to assist in training the team in the technical aspects of Lean and helping with team-working issues. Team membership will rarely exceed ten people and will generally be in the five to eight range.

The role of the project team is to:
1. Review the project scope sheet and request modifications as needed to insure that the project is doable
2. Identify and document the work steps required to achieve project objectives
3. Execute the work steps
4. Solve problems, remove impediments to project success
5. Measure results
6. Prepare and present interim status reports and a final report upon project completion
7. Follow up to ensure that the gains obtained by the project are retained

The role of the Team Leader is to:
1. Ensure that the project scope sheet is properly completed and up to date
2. Ensure that all required resources are assigned to the project and clearly tasked
3. Manage assigned resources according to the defined scope of the project
4. Ensure that project cost and time targets are met
5. Monitor and report on project performance
6. Report on escalating project risks and issues
7. Manage project interdependencies
8. Make adjustments to the detailed plan as necessary to provide a complete picture of the progress of the project at any time
9. Manage the preparation and delivery of the final report-out

Often the team leadership functions will be shared, particularly in the early going when leadership skills are being learned. The Coordinator and/or consulting resources may help with team leadership responsibilities in these situations.

The role of the team member is to:
1. Undertake all work steps allocated by the Team Leader (as per the Project Plan)
2. Report progress of the execution of tasks to the Team Leader on a frequent basis
3. Maintain all documentation relating to the execution of allocated work steps
4. Report on escalating risks and issues to be resolved by the team Leader

With the team in place and the roles defined, there is one other critical point to be made. While the Lean/World Class Enterprise knowledge base is being built, we are likely to field teams that lack the know-how and the skills required to execute the projects that they have been assigned to do. It is the express responsibility of the Steering Team to recognize any knowledge gaps and arrange for team training. The training requirement will diminish over time as more people are schooled in Lean, but every team should be evaluated as to their ability to find and implement the solutions targeted by their project.

Finally, it is vitally important that the team issues brought to the attention of the Steering Team be handled promptly and effectively. We do not want to send the wrong message by ignoring these matters or procrastinating on their resolution.

CONCLUSION
Any effort to bring Lean tools to bear in a given company will demand a significant investment of time and money. The structure and discipline suggested in this series of articles can be viewed as insurance against the loss of that investment. The suggested approach will rapidly build a Lean/World Class Enterprise knowledge base while addressing hundreds of problems with effective solutions. To test the validity of the methods, watch the company scorecard and key performance measures in the value streams in which you are working. And, of course, watch the bottom line. We think you will like what you see.