LEAN & IT:CONCEPTS TO CONSIDER

M. Peter Scontrino, Ph.D.Industrial-Organizational Psychologist

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Agenda

Customers and Suppliers

Lean Defined Role of Leadership Ten Forms of

Waste Value Added Results References

Ensures better customer service Reduces process complexity Enhances process speed Produces quality products and services Helps employees to become more engaged Improves staff morale

Lean is “common sense uncommonly applied ”

Why Use Lean?3

Origins:

Lean

W. Edwards Demming, Ph.D. 70% of U.S. manufacturing firms report using Lean

Rapidly expanding use of Lean in government and service sectors

Locally: Boeing, State of Washington, Children’s Hospital,, Port of Seattle, Weyerhaeuser, Nordstrom, King County, City of Redmond, Federal Government, University of Washington, Virginia Mason, Group Health, and many more

Who Is Using Lean?4

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Lean Requirements

Lean includes any systematic process that focuses on satisfying customers’ expectations, eliminating waste, and improving product/process quality.

Process refers to a repeatable series of steps that:

Takes input from a supplier (anyone

you receive a hand-off from).

Adds value.

Creates output for your customer (anyone to whom

you provide a hand-off).

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Lean: Lean is a set of principles and tools that help people

“learn to see” and eliminate waste

Lean organizations: Enables organizations to work more effectively and

efficiently by identifying and eliminating waste in their processes

Methods include: Specific tools such as Pareto & Cause and Effect Value stream mapping and Kaizen events Identification of waste and ways to improve

What Is Lean?6

Apply Lean concepts to your organization:

What processes would you like to streamline or improve in your department? In your organization?

Exercise One7

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Customers and Suppliers

Supplier: An individual or entity that provides an input to a process

Inputs can include resources or information

Customer: The recipient of a product or service you produce

The customer defines value in your services Every process, no matter how large or small, has

a customer

Remember, Lean processes take inputs from suppliers, adds value, then creates outputs

for your customers

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Homework Exercise: Customers and Suppliers

Identify your own customers and suppliers

Ask the following:

I. What do you need from me?

II. What do you do with what I give you?

III. Where are the gaps?

Explore: product, relationship, delivery, and expense

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Lean Approach

Some organizations approach Lean as if it were a collection of tools that can be easily applied to improve the organization....

In fact, Lean begins with the senior leadership team

and permeates through everything we do.

It is also

continuous – meaning that this process is not a program with an end date...

It is a journey.

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Lean: Necessary Components

Patrick Townsend: Seven Components of Effective

Continuous Process ImprovementTop management education & commitment

Leadership involved at all levels

Goal of 90% - 100% employee involvement over time

Communication

Training

Measurement

Recognition, gratitude, and celebration

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Lean: Assumptions

There is waste in the processes that we use. Employees come to work every day wanting to

do a good job. Employees work hard. Lean is not about motivating employees.

There is room for improvement in the way we do our work.

Lean focuses on both what we do and how we do what we do.

The focus is on processes/systems and not on people.

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Virginia Mason Video

http://www.bing.com/videos/search?q=virginia+mason+video+on+lean&FORM=VIRE2#view=detail&mid=84FAF4D5705B00AF846E84FAF4D5705B00AF846E

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Measurement: Points to Consider

The difference between lead time and process time

Who is the customer and what does the customer want?

The difference between stakeholders in the organization and the customer for a particular activity

Metrics form the baseline for improvement

Leaders need to have the expertise to manage Lean

Time

Customers

Differences

Metrics

Expertise

Lean Definition

Lean is the identification, elimination, and reduction of waste or non-value added activity within a process as perceived by the customer

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“House of Lean” Methods

1 Point of Use Storage

Customer Satisfaction

Just-in-Time/Kanban Mistake-Proofing Metrics

Visual Controls POUS1 Employee Engagement

Quality at Source Batch Reduction Waste

Standard Work 5S Flow/Layout

ValueStreamMapping

Kaizen Events

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Try this exercise back at workBatch processing versus one piece flow

Flip the coin exercise.1. Four people pass coins.2. One person will time the operation.3. Start with a batch of 20 coins.4. With the opposite hand, the first person flips over 20

coins and passes to the next person. That person flips all 20 coins and passes them to the next person and so on. Record the final time and number of mistakes.

On the next round, use a batch of 10 coins. Next round, use a batch of 5 coins. Final round, try single piece flow – one coin at a time. Compare the results.

After reviewing the results, perform a group brainstorming session and devise a faster way to process the coins!

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Waste Definition

Waste is…

Any action, process or product that adds cost, without adding value as perceived by the customer.

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The 10 Wastes in IT (and other service) Organizations

1. Lack of standardized processes

2. Defects

3. Over provisioning

4. Delays

5. Non-value added processing

6. Transportation issues

7. Excess inventory problems

8. Excess motion

9. Unused employee creativity and knowledge

10.Waste of staff time

Typical Wastes Targeted by Lean

Wastes ExamplesLack of standardized processes

Each person has his her own way of approaching a problemEach person has his or her own way of completing a task

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Typical Wastes Targeted by Lean

Wastes ExamplesDefects Not understanding user/customer

requirements and expectations, thus delivering ineffective solutions

Application bugs and design flaws or unstable software/hardware/devices making it difficult for staff to get value added work done

Unauthorized changes to software and systemsInadequately tested changes to software and systemsHelpdesk knowledgebase information incorrect, incomplete, or obsolete causing harm and lost productivityFree text fields instead of drop down/check boxes that allow user error and bad dataOrder entry errorsOrder changes

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Typical Wastes Targeted by Lean

Wastes ExamplesOver provisioning Help desk troubleshooting that addresses

symptomsbut not root causesProducing and distributing reports that are not usedUnused functionality in softwareWorkflow routings that are not necessaryIneffective and repetitive meetings

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Typical Wastes Targeted by Lean

Wastes ExamplesDelays Searching for information

Delays from excessive reviews and approval stepsSlow application responseDelays between coding and testingReports that take a long time to runLong helpdesk hold and call back times

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Typical Wastes Targeted by Lean

Wastes ExamplesNon value added processing

Processing of sales invoicesOrdering of training materialStoring of materialHaving staff meetings to discuss a product or servicePrinting and assembling work books for training classesRe-entering dataExtra copies

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Typical Wastes Targeted by Lean

Wastes ExamplesTransportation Sending attachments rather than links

Excessive e-mail attachmentsOnsite visits instead of using remote technology to resolve issuesPoor user interfaces

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Typical Wastes Targeted by Lean

Wastes ExamplesExcess inventory Excess information on local and shared

drivesWork waiting to be reviewed/approved/forwardedSoftware purchased but not deployedBacklog accumulating in software developmentUnused/unnecessary software licensesExcessive inventory of printer cartridges and consumablesExcessive parts inventoryExtra copies

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Typical Wastes Targeted by Lean

Wastes ExamplesExcess motion People looking for parts, tools, supplies

People looking for files, paperworkPeople going to a meeting, not preparedPeople going to a room down the hall to retrieve printouts from their computerPeople walking to another room or building to process documentsCentral filingWalking to and from fax machines

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Typical Wastes Targeted by Lean

Wastes ExamplesUnused employee knowledge and creativity

No empowermentLimited employee authority and responsibility for basic tasksNot asking for ideasNot capturing and sharing ideasNot making knowledge easy to locate and applyUnnecessary process/data or system complexity

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Typical Wastes Targeted by Lean

Wastes ExamplesWaste of staff time Waiting for instruction

Waiting for materials/data/informationUnnecessary meetingsMeeting not starting on timeUnnecessary travelSystem downtimeSystem response timeApprovals from others

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Value-Added – The antithesis of waste

Lean focuses on value-added activities…

Any activity (task) falls into one of three categories:

Value Added

Non Value Added

Non Value Added

Required

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Value Added and Non-Value Added

Value Added (VA) The customer must recognize the task as important. The product or service must physically change or

transform. The task is done right the first time.

Non-Value Added (NVA) Waste. A process step that adds no value to the product or

service. Does the customer want to pay for this?

Non-Value Added Required (NVA-R) A process step that adds no value to the product but is

currently required to produce the product or service. A required law, regulation, rule etc. Internal or external.

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Best management practices and value added

It is important to note that many good management practices, like effective coaching, leading effective meetings, preparing accurate budgets, strategic planning, might be perceived as being in the non value added box from the definition on the previous page.We prefer to refer to these best management practices as value added management practices. The customer (person requesting a permit) is not interested how good a job you do of strategic planning, yet your good work in this area helps the organization be more effective.

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PersonalTeam or

Department Organization

Macro

Micro

Nano

Homework: Create your own chart of non-value-added activities you have experienced.

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Is Lean another “flavor of the month”? The short answer is, “No.”

Why Lean is different: Focuses on rapid, immediate, real-time change Delivers fast results to build momentum Emphasizes doing over planning Keeps all eyes on what matters thru metrics/visual

systems Builds continuous improvement culture by

empowering workforce to own the process and its effectiveness

What Makes Lean Different?34

Examples of ResultsProcess Results

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Lean represents significant change.

“There is no change without loss.

There is no loss without pain.”

Something to Remember36

Steven C Bell & Michael A Orzen. Lean IT: Enabling and Sustaining Your Lean Transformation.

Ken Miller. We Don’t Make Widgets.

Charles Kenney. Transforming Health Care (at Virginia Mason).

Karen Martin & Mike Osterling. The Kaizen Event Planner.

Joyce Miller, Tania Bogatova, & Bruce Carnohan. Improving Performance in Service Organizations. How To Implement a Lean Transformation.

Selected References37

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Learn MoreTo learn more about Lean and other practices that can increase the effectiveness and morale of organizations, teams, and individuals, follow our applied research blog at: www.scontrino-powell.com/blog

About UsScontrino-Powell

M. Peter Scontrino, Ph.D. 425-392-5694

Jevon K. Powell, Ph.D.206-933-6355

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Wrap-Up

Thank You!!