lean thinking Archives - Partners in Business Excellence, LLC

Getting Lean in Business is Like Going on a Diet

March 13, 2019 By Peter Holtgreive No Comments

Getting lean in business is a lot like going on a diet. As with most “trends” we see huge success, as well as those who come out to claim failure. The trend on the top of my mind when I think about this is the keto diet – the diet where people eat low to no carbs and high amounts of fat that changes the dieter’s metabolic state to that of ketosis.

People jump on the diet and lose tens of pounds, but those who give up, usually state that it’s just too hard to maintain. Oddly enough, this is the same reason given for the failure of lean in business – lean principles are just too hard.

Getting Lean in Business is Like Going on a Diet

People who go on diets have a strong desire to lose weight. In the beginning, they are excited, motivated and determined to see the outcomes they desire. Many get going in their diet and then it hits – they want a beer after work… to order pizza on a Friday night… to grab a quick something on the road because they left that diet meal sitting on the counter by mistake… And then, all of a sudden, the diet seems hard. They get tested and have a choice: eat what they are wanting (not what they need), or keep their eyes on the prize.

Digging Deep for the Root Cause

Lean in business starts with management excited for the desired outcomes: more floor space and organization, better inventory management, fewer defects, higher quality, more profit. We do a walk-through and start learning about the processes and mission-critical steps and start asking questions. Things are moving along and then… they get tested. Why is the forklift sitting broken? Who is responsible for it? How long has it been out of service… wait, how long??? Why are you paying for custom envelopes? Why is there double entry?

All the questions reveal root causes and expose old habits and behaviors. We do this to dig in deep to get to the source of the problem and uproot it entirely so it doesn’t return. But for some, this feels hard. It feels “redundant”. The irony is that redundancy is what we are working to remove. The time we are spending is actually correcting years of mismanagement of the process we are adjusting and improving.

Success or Failure: It’s a Choice

So, just like a diet, we can give up and try something else, or accept that we will always have that extra chunkiness, or, we can keep our eyes on the prize and make a commitment to seeing the end goal achieved. And, because lean digs in deep, the goal stays. “Lose the weight and keep it off” in lean becomes “Meet the goal and keep improving”.

To prevent a lean failure, do the work. Buy in, work at it, rely on your coach when things get hard, and keep an open mind to create a curious company looking towards the prize of continuous learning, constant improvement, and a truly lean culture.

PBEX, LLC provides a complete review and analysis of the business processes that create efficiency and profitability, and the barriers to them. Contact us today to learn more about lean business management and to schedule your review with a process improvement expert.

Business Process Management

Want Better Processes? Start with Value

August 14, 2018 By Peter Holtgreive No Comments

As a process improvement expert, I am called into a business to help them in a variety of ways, usually all to help the company’s bottom line. Sometimes this looks like reducing inventory spending. Sometimes it is increasing productivity through more streamlined processes. And other times it is less quality defects. While there are a number of methods I use to help us determine how to improve, one of them is to look at value.

Who Determines Value?

Economists have a philosophy of supply versus demand, and anyone who has taken a college level economics course has heard of it. Basically, it says that when something is in high demand and low supply, the costs go up (example: diamonds). Conversely, if a product or service is in low demand and is in high supply, the costs go down (example: fill dirt).

This philosophy then tells us that the market, or customers, determine our product or service’s value, but when we think about process improvement, do we go back to the customer to determine what would add additional value to them? Shouldn’t we?

Value Versus Waste

In Lean philosophy, we look at things as a “value added vs. waste” model. We consider steps or tasks to be value added when it transforms the product or service, the customer is willing to pay for it, and it is done correctly, the first time. When all three conditions are met, the business makes money. Everything else is considered waste and cost the business money.

From here, we break this wastefulness into eight categories of waste, and then, as a process improvement expert, we tackle each to create a truly valuable end result product or service for clients and a healthier bottom line for the company.

The Eight Areas of Waste (Non-Value Added)

When I begin to look at processes through the eyes of value to the customer, here are some questions that I may ask to get to the root of the process wastefulness:

Defects: How much do defects and rework cost? Are there mistake proofing processes that can be implemented to reduce or eliminate defects?

Overproduction: Do processes meet demands? In which cases does it not match, resulting in piles of work waiting for the next process? Are there people or equipment that are overburdened?

Waiting: Who is waiting for work to be completed and why? What is causing the “idle”?

Non Value Added Processing: What is being done that isn’t adding value to the end user? Why is it important?

Transportation: Between the processes, are there unneeded steps? Is there a way to simplify movement or transportation through the facility?

Inventory: How is inventory being managed? Is there dead/cold inventory? How are raw materials cultivated?

Motion: What is being moved around and why? Is there a way to lessen any movements, including those done by equipment and people?

Employees: Is the business getting the most out of their employees? Are employees empowered and engaged? Are there skillsets or abilities that are not being used?

Business Process Management

The 5 Concepts of Lean Thinking Summarized

July 10, 2018 By Peter Holtgreive No Comments

Lean thinking is really conceptualizing lean principles and how they apply to a specific enterprise. Because Lean principles started in Japan with the Toyota Production System, its primary application has been in manufacturing. Today, Lean manufacturing has been growing in interest and popularity as more and more companies look for increased agility, faster to-market production, and stream-lined processes that reduce wasteful practices. Its implementation has even spread outside of fabrication into a broader business use.

Whether in lean manufacturing or lean management in other industries, five primary principles have been established to capture the goals of lean. These concepts were captured by, and summarized here based on the book “Lean Thinking” by Womack and Jones. And while the concepts themselves are simple, the implementation takes time as perfection is the final goal.

Lean Thinking Concept 1: Value

Value is what is delivered, and set primarily by the customer. What the consumer is willing to pay should be the goal of production to meet that value and also provide profit to the producing company. For example, if a consumer is willing to pay $10 for a widget, the company should use that value as their benchmark for production, eliminating waste and improving processes to meet customer expectations.

When customers are having their expectations met and companies are making profits, this is considered perfection.

Lean Thinking Concept 2: The Value Stream

Understanding the flow of the life-cycle of a product is the only way to truly eliminate waste. The Value Stream concept examines the flow from production to disposal of any given product to find areas where value is lacking and can be improved, or where processes are wasteful. Some wasteful processes may be unavoidable due to certain circumstances such as lack of technological advances or access to resources.

The awareness that is created in regards to the wasteful processes allow them to be corrected or improved for better outcomes.

Lean Thinking Concept 3: Flow

Flow refers to the state by which all processes are in alignment making production move forward without interruption. As wasteful practices are eliminated, production increases. This includes processes that previously halted product launches and to-market deliverables, something critical in today’s market where agility, speed and quality are of tremendous value.

Flow is the state where wasteful down-time no longer exists.

Lean Thinking Concept 4: Pull

Lean concepts tend to reduce cold inventory because rather than relying on forecasting demand, they put in place communication and manufacturing methods that allow for production on the fly – as customers order.

What if “busy work” was eliminated and production only happened when a sale closed? It’s a revolutionary mindset and manufacturing concept that both increases efficiency and output.

Lean Thinking Concept 5: Perfection

While we have all been taught that nothing is perfect, lean concepts are rooted in achieving perfection through continuous improvement. When an organization truly implements lean tools and concepts, they strive to get to the root of problems, never using a “band-aid” approach for fixes, but rather really dig into data and processes, and be willing to change based on feedback. They in essence create agility in business by being perfectionists focusing on lean.

Contact me today to learn more about lean thinking and how to apply it to your business to create more efficiency and profitability. Together, we will create a continuous improvement culture and healthier bottom line.