Recession Proof using Lean Sigma

Lean ThinkingIreland was once an ideal manufacturing base, close to Europe, with highly skilled people, and an economically viable cost base. Today, as a country, we need to offer alternatives to ensure ‘Ireland Inc.’ is the country of choice for future investment. I believe that ‘Innovation and Creative Thinking’ are key attributes we need to strive towards in our business thinking. Ireland Inc. must have a vision and mission to be the most creative and innovative nation in the world.

Business success is dependant on four elements: –  Products, Processes, Competencies and Culture. A world class athlete fine tunes his/her technique, trains until it is perfected and then displays the behaviours that support success. Also, at any one time, they understand their goals. They understand what is expected of them. They can measure how well they are performing, and they have the resources they need to be successful. Most importantly, they are committed to the task. The loss of any one of the elements will result in failure. When we strive to improve organisations, we must collectively address each of the three critical elements – process, competencies and culture. This holistic view can present challenges for some as competence can be defined quite narrowly. This can result in organisations being led by technically brilliant people but they may lack the ‘softer’ competences and strategic skills.

Understand, Measure and Improve your Key Processes

The products that you make or the services that you provide are done through a set of key processes. From the point of Order Entry right through to customer delivery and usage, defines your manufacturing process. Process Mapping is one of the most fundamental, simplest, and most useful improvement tools to understand how your processes work. When you understand them you can then simplify them. Understand the elements that are critical, do those very well. Understand the elements that are not necessary, don’t do those at all. Utilising the principles of Lean Thinking allows you to focus on the different types of wastes. Lean Thinking defines seven different types of waste – transport, inventory, movement, waiting, overproduction, over processing and defects. The principles of Creative & Breakthrough Thinking identify solutions to eliminate/reduce these wastes. Six Sigma defines methodologies to reduce variability. Define key metrics for your organisation. Long term metrics define your strategy over the coming years. Short term metrics measure you performance over days, weeks and months. Put a governance structure in place to ensure you measure performance at the right time, with the right people. Simple concepts as Kaisen and 5S can also deliver immediate results. I believe that any organisation that understands the fundamental concepts of creative process improvement, Lean Thinking and the fundamentals of Six Sigma, has the capability to solve more than 80% of its issues.

Ensure People have the Competencies to Think, React and Develop

Imagine now, we have optimised the manufacturing processes. It is essential that everyone who is involved, understands how the process works, has learned and demonstrated the skills required to produce consistent results. This could be crudely defined as the competence to ‘Do’. As well as understanding how to operate the process under normal circumstances, it is imperative to understand what to do when a deviation occurs. These behavioural thinking skills are equally critical as they define how soon we get back into control. These skills include data analysis, data presentation, facilitation skills, problem solving skills, creativity skills, communication skills, report writing skills, etc. These could be defined as the competencies to ‘Fix’. Imagine another layer of competences on top of this one. This level of competence defines how we collaborate and align ourselves behind a common goal, how we behave in meetings, how we educate, motivate and recognise ourselves and others. These are the competencies to ‘Improve’. Having a strategy to deliver these competencies will deliver significant value add to any organisation.

Ensure the Culture Supports the Organisation.

Culture (from the Latin cultura, meaning “to cultivate,”) generally refers to patterns of human activity and the symbolic structures that give such activities significance and importance. In a business context, culture can be defined as all the behaviours, ways of operating, beliefs, manners, dress, language, rituals and institutions that define that business. If the culture of an organisation is not congruent with its vision then success will be difficult. Culture manifests itself in the way we interact. For example, the way meetings are conducted, the way we respond to customers, the way we treat our staff. Most of us spend many hours in meetings, once defined as – “a place where minutes are taken and hours are lost”. If the culture is to talk all day, take no actions, allocate blame for failure, recognise the ‘arsonist turned fire fighter’ for solving today’s problem, then this culture will not promote the ideas of innovation, collaboration, creativity. We experience this culture every day but if these habits continue to happen then they become the accepted culture and hence remain unchallenged. We have all been in situations where the culture was just right. Everyone knew what they were trying to achieve. They knew their role and the role of others. They performed their jobs flawlessly. They supported and motivated each other. They collectively addressed problems with the mindset of achieving the end result. They encouraged positive behaviours and discouraged negative behaviours. Developing this culture of a team is very important. Many people think when we talk about team as a specific project team, but in reality the natural work team is a bigger contributor to success. Good communications, clear metrics & targets, feedback on performance, discussion on what is working and what we can improve are all essential elements. Team development activities can be a great support to developing the team when they are properly facilitated. Designing exercises to simulate desired characteristics in a safe environment can provide incredible results.

Today, access to information is easy; we need to develop the skills to best use that information. The model outlined provides a framework to assess and develop those skills.

Focus on Product, Process, Competency and Culture. Ensure expectations are known, Performance is measured and acted upon and resources are available.

Posted in Business Posts.