Curious Cat Management Improvement Blog: Deming, lean thinking, innovation, customer focus, continual improvement, six sigma.
September 29, 2005

Business Improvement with Six Sigma

Business Improvement with Six Sigma by Dr Anirban Basu (Express Computer, India IT weekly):

The organisation, a CMMI-level 5 company found that although the SLA (Service Level Agreement) with its US client specified that the support time for most critical (level one) complaints should not exceed 6 hours, on the average, it was taking 8 hours with variation from 2 to 14 hours. Further, its US client told them that the support time needed to be reduced to 4 hours because of strong demand from end-users for better service.

Related Posts:

Spreading the Lean Gospel

Spreading the Lean Gospel by Rebecca Reid:

Bested said lean manufacturing at the Air Fuel Modules Division was a two-fold philosophy. The first aspect was to resolve current manufacturing inefficiencies and to implement lean principles for all new programs coming in, and the second was changing the business processes involved.
September 25, 2005

The Lion of Lean

Great article - The Lion of Lean: An Interview with James Womack by Francis J. Quinn, Supply Chain Management Review:

Let’s just take one example in the purchasing area. People say, “Yes, we’re going to have a lean purchasing organization. And we’ll start by having target pricing.” You say, “Great, but how are you going to do target pricing?” “Well, we’ll set the prices 5 percent below what they are now and that will be our target pricing.” “Fine, guys, but you haven’t done any analysis. With true target pricing, you actually have to look at every step and figure out what it costs - including what’s happening out in the world right now with regard to materials. The costs are really going up, and this reality has to be factored into your pricing approach; otherwise, all you’re doing is squeezing your suppliers.”

As Deming said page 31 of the New Economics: “A numerical goal accomplishes nothing. Only the method is important not the goal.”

Lean people are always technology skeptics. They’re not Luddites, mind you, they’re just technology skeptics. They spend their time on creating a process that requires as little information as possible, while the rest of us try to figure out how can we get more and more and more information.
Perhaps the most interesting example is 7-Eleven in Japan. It’s probably the leanest grocery company on the planet, doing demand-driven replenishment multiple times during the day. Solectron is doing a good job of going lean in contract manufacturing. You find some examples in unexpected places, too. One of my favorites is the post office in Canada. Postage rates in the United States keep going up, and the USPS [United States Postal Service] is losing a fortune. On the other hand, Canada Post is keeping rates steady and pays hundreds of millions of dollars in profits to the Canadian government. What’s the difference? Canada Post went lean.

More lean thinking articles - Womack articles.

How Toyota Turns Workers Into Problem Solvers

Topic: Management Improvement

How Toyota Turns Workers Into Problem Solvers, Sarah Jane Johnston interview of Steven Spear.

It is our conclusion that Toyota has developed a set of principles, Rules-in-Use we’ve called them, that allow organizations to engage in this (self-reflective) design, testing, and improvement so that (nearly) everyone can contribute at or near his or her potential, and when the parts come together the whole is much, much greater than the sum of the parts.

The main difficulty is not a knowledge gap, but a performance gap. Most of what Toyota does has been published in numerous books (The Toyota Way, The Machine That Changed the World…) and articles (see see Curious Cat links to books and articles on Toyota’s management ideas). Reading that information is wise, but that is the easy part. The difficult part is actually managing more effectively. Some of the concepts can be difficult to accept but they really are not too difficult to understand.
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September 23, 2005

SPC: History and Understanding

SPC: From Chaos To Wiping the Floor by Lynne Hare (who also was the 1997 Hunter Award winner)

Shewhart based control chart limits more on the economics of change than on underlying probabilities. Ever the empiricist, Shewhart seems not to have trusted probability limits alone.

Setting control limits at 3 standard deviations is a decision based on experience. Shewhart, Deming and others determined it was sensible to take resources to look for a special cause was most effective for results more than 3 standard deviations from the mean - it is not a mathematical conclusion but a empirical conclusion.

It is disappointing to see some users place specification limits on control charts. Processes don’t know or even care about specifications. The presence of specification limits on control charts encourages users to adjust on the basis of them instead of the calculated limits. The resulting miscued adjustments are likely to result in increased process variation, which is the opposite of the intent.

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September 22, 2005

Operational Definitions and Data Collection

Americans’ Dirty Secret Revealed by Bjorn Carey
See also: Google News on washing hands - Soap and Detergent Association press release

A study released recently spawned a flurry of articles on washing hands. I have seen such reporting before and again I find it interesting (as sad as that might be). The stories repeatedly say things like: “Men’s hands dirtier than women’s.” The study actual was focused on the percentage of people who washed their hands. While there is likely a correlation, making such leaps in reporting data is not wise. This example is often found in the data used in organizations. Where interpretations of the data are given as the facts instead of the data itself. However that is not what I find most interesting.

Instead I find the lack of operational definition interesting. In many of the articles they have quotes like:

In a recent telephone survey, 91 percent of the subjects claimed they always washed their hands after using public restrooms. But, when researchers observed people leaving public restrooms, only 83 percent actually did so.

Only 75 percent of men washed their hands compared to 90 percent of women, the observations revealed.

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Googlebombing

The Google blog has a new post on: Googlebombing ‘failure’

Basically they explain that Google is not making a judgment that the result top results for “failure” represent Google’s opinion of who is a failure. The top result is the Biography of President George W. Bush on the whitehouse.gov web site, and the second result is Michael Moore’s home page.

As Google explains:

By using a practice called googlebombing, however, determined pranksters can occasionally produce odd results. In this case, a number of webmasters use the phrases [failure] and [miserable failure] to describe and link to President Bush’s website, thus pushing it to the top of searches for those phrases.

That explanation makes sense.

We don’t condone the practice of googlebombing, or any other action that seeks to affect the integrity of our search results, but we’re also reluctant to alter our results by hand in order to prevent such items from showing up.

I think here their post gets a bit tricky. I think it makes sense that they say they don’t condone “the practice of googlebombing” but exactly what the difference between that and the “collective wisdom” of the web that they tap to determine what words people use to link to a web page is tough to say. If a bunch of web authors think the photos of Olympic National Park on our web site are worthy of linking to that is exactly the type of information Google takes advantage of to provide relevant search results.
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September 21, 2005

Everybody Wants It, Toyota’s Got It

Everybody Wants It, Toyota’s Got It by Grant Robertson, Globe and Mail (Canada):

Despite riding atop the North American auto sector for the past decade, the company’s manufacturing methods are an open book.

People often look for the secret new idea instead of just executing well. So much improvement is available just using ideas that have been known for decades. But instead of doing that people keep searching for new magic bullets.

Line workers spend two hours at one job, then transfer to another within their group of half a dozen people, a strategy Toyota believes helps break monotony, foster teamwork and keep the plant flexible when employees are away.
“Toyota has probably laughed behind everybody’s backs for years,” he says. “Everybody goes in there and looks at [the Cambridge plant] and walks out, but doesn’t really understand how to do it. So because of that, I guess they still continue to let them look at it.”

25 New MacArthur Fellows

25 New MacArthur Fellows Announced
press release
overview of fellows

The John D. and Catherine T. MacArthur Foundation today named 25 new MacArthur Fellows for 2005. Each received a phone call from the Foundation this week informing them that they will be given $500,000 in ‘“no strings attached’ support over the next five years.

I think the fellowships are a great idea: give money to people who have done excellent work. I am not sure of the motivations of the MacArthur Foundation, but if it were me I would trust by providing funds to those people they would (as a group, not every single person) take advantage of those funds to create great advances for all of humanity.

As I have mentioned before I also like, Trickle Up. While different in actual, to me there is a similarity: money is given that provides opportunity that I trust will make for a better world. The fellowship site does mention: “unrestricted fellowships to individuals across all ages and fields who show exceptional merit and promise of continued creative work” which indicates they do expect conduit creative work even though the fellowship is unrestricted.

It is great to see examples of those doing work worthy of such high praise.

September 15, 2005

Solectron IndustryWeek Best Plant

Solectron Corp: IW Best Plants by John Teresko

To empower its employee strategy, Columbia (and the rest of Solectron) is dedicated to an ongoing journey of Six Sigma and lean manufacturing, says Petta. For example, several times a year it is not unusual to encounter kaizen events on the plant floor

before lean arrived at Columbia, WIP typically was five days. After implementation of lean, WIP has been reduced to a half-day to one day. Lean also has cut employee “touches” as measured by the number of times a unit is picked up or transferred from one station to another. On average, “touches” have been reduced from eight to four, Petta says.

Solectron has long been a company focused on management improvement: Baldrige, Six Sigma, Process Improvement, Lean etc. Their stock value sure has not done well however. Partially this is due to the very difficult contract manufacturing competitive landscape.

September 14, 2005

Healthcare Costs Spike Again

Healthcare Costs Spike Again by Jeanne Sahadi, CNN/Money:

The premium growth rate this year – 9.2 percent – outpaced by miles both the growth in wages (2.7 percent) and inflation (3.5 percent)

since 2000 premiums for family coverage have gone up 73 percent. During the same period, wages rose just 15 percent.

This is not sustainable. I feel like Brad Setser talking about the USA trade deficiets (by the way if you have any interest in economics, or international trade, or investing you really should read his economics blog - it is great). Deming noted excessive health care costsas a deadly disease to the American economy and the news just gets year after year. This system is obviously broken and in need of fundemental change.

Related Health Care posts:

Health Care improvement articles and studies via the Curious Cat Management Improvement Library.

September 13, 2005

Edson Puts The Squeeze On Waste

Edson Puts The Squeeze On Waste by Ron Richardson

“One of our wrong, old core beliefs was that inventory is good,” says Hattin. “We thought it provided rapid availability to parts and allowed us to get to work quicker. That was the first sacred cow sacrificed on the altar of Lean management.” He says there were some veteran employees who felt “a good deal of pain” when the old way of operating was tossed out.

“Our mantra now is unless we have an order for it, we don’t build it. That and some multi-skilled plant people - for which we pay them extra for the additional skills have made us more effective.”

Accepting lean ideas is not always easy. Lean thinking requires a new way of viewing the world. The system must change for the methods to work.

In doing its own thing, Edson scrapped a computer-based kanban system in favor of its manual set up because, as Hattin explains,”it’s self-managed and provides quick visibility on the tasks on hand. “The investment was reasonable - about $78 for a peg board and color cards. The best thing about it is that everyone can see what’s going on in about 10 seconds and knows what the next job is.”

Advanced technology is great, but as a hammer is not always the best tool, similarly the most technologically sophisticated solution is not always the best solution.

September 12, 2005

Using Lean and Six Sigma in Project Management

Using Lean and Six Sigma in Project Management by Derrell S. James, Quality Digest:

Our subject company used tools such as 5S to establish consistent workforce organization and improve productivity per square foot of space. They used standard work to ensure consistency of the most optimal methods and communicated these to its manufacturing divisions throughout North America. By reducing inhibitors to just-in-time manufacturing, they reduced inventories, total cycle time and internal costs.

However, the quality of that velocity is forever tied with reducing variation–thus the innate and required linkage with Six Sigma tools.

September 10, 2005

Measurement and Data Collection

This is my response to the Deming Electronic Network message on measurement.

I find it useful, to assure that data collection is a wise use of resources, to ask what will be done with the results. If you don’t have an answer for how you will use the data, once you get it, then you probably shouldn’t waste resources collecting it (and I find there is frequently no plan for using the results).

I have found it helpful to ask: what will you do if the data we collect is 30? What will you do if it is 3? The answer does not need to be some formula, if 30 then x. But rather that the results would be used to help inform a decision process to make improvements (possibly the decision to focus resources in that area). I find, that asking that question often helps reach a better understanding of what data is actually needed, so you then collect better data.
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September 8, 2005

Keeping High Tech Jobs

Keeping High-Tech Valley Jobs by Ed Taylor, East Valley Tribune (Arizona) via Lean Manufacturing Blog:

The company was able to make the move in part be cause of new lean manufacturing techniques adopted in Phoenix that increased the capacity of the plant by 25 percent without additional capital spending, Hall said.

Engineers achieved that by changing the layout in the fab and reducing losses in the manufacturing process, Hall said. And employees were trained in Six Sigma quality improvement techniques, he said.

September 7, 2005

North Cascades National Park Photos

Topic: Travel Photos

I finally have posted photos from my June 2005 trip to North Cascades National Park. See more photos from the same trip: Mount Saint Helens, Olympic National Park, North Cascade National Park. Photos from other trips: Curious Cat Travel Photos.

Deming and Six Sigma

My message in response to messages on Six Sigma on the Deming Electronic Network:

I think the DEN members criticizing the problems with Six Sigma make valid points. However, I personally think they often go too far. That is my opinion, and each of us have our own views.

While some (probably even many) of the Six Sigma exhortations for Six Sigma quality would properly be seen as a slogan or a target without a method I don’t think it is fair to say they all are. Six Sigma includes a method to improve.

I think we may have gone to far, when we get to the point where: Deming said some things against Six Sigma, therefore Six Sigma is bad. Deming questioned what TQM meant, therefore TQM is bad. I agree aspects of Six Sigma are bad. I also think some aspects of Six Sigma are good. And I think the same things about TQM.
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Six Sigma Pitfalls

Six-Sigma Pitfalls by Marc S. Morrison, Industry Week.

Are Differences In Implementation Creating Different Results?

In a word, yes.

While an amazingly simple idea, people seem to forget this quite often. When people say “Six Sigma is great” or “Six Sigma is a waste” often they are talking about different things. But because in both instances “Six Sigma” is used people believe that the meaning must be the same in both cases. It often isn’t. While I find some Six Sigma efforts, books or consultants very useful many others (that also use the words “Six Sigma”) do not offer much of value.
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Car Navigation Systems

Topic: Management Improvement

Thinking About in-car Navigation Systems by Robert Scoble:

What’s frustrating is there’s no way to report a mistake. So, everyone who has Toyota’s system is doomed to repeat the same errors.

While Toyota is doing great things they still have things to learn. As the quote above indicates they don’t think like software companies. Software companies have learned to take every advantage of the internet to collect feedback. And those used to such system will find fault with any company that fails to do so, as shown above. And for good reason, failing to collect such feedback is a poor practice.

Another thing? We searched for Starbucks at least four times this weekend. Every time Dave needed to spell S - T - A - R - B - U - C - K - S out completely.

Why can’t the system learn after a few times that you’re a Starbucks freak and just permanently put that in the memory. Dave even went further. He’d like the system to say “you’re near a Starbucks, wanna go there?”

Having to type out the entire word over and over seems like a poor design.

I still can’t wait to get one in my next car.

And this statement is still true. While certain aspects of the current system could be improved this is likely an innovation that will become an expected feature in cars in the future. Hopefully with a better mechanism for collecting feedback.

September 5, 2005

Innovation and Customer Focus

Katrina - the landline - Telecom’s Response by Stuart Henshall via Scobleizer

Is it too much to ask Bell South to:
* Let displaced account holders log in and claim their accounts (phone numbers) via the Internet.
* Offer every subscriber in the devastated area a free soft phone with voice mail that replicates their old home number? Softphones that would do the job are available. If the numbers were transferable then Skype could probably scale a solution in just hours rather than weeks.

Good idea. If Bell South doesn’t want to be innovative immediately, then regulators should require land line companies to allow Voice over Internet Protocol (VoIP) companies to provide solutions. To me the key is to allow the land lines to be converted to a solution that will work for customers now. VoIP seems like the best alternative, for all those in temporary lodging.

For such a plan to work companies will have to provide the VoIP service in a very easy to use way. My guess is if this idea is tried, they will make it work.

Another post with more details on this idea: A Brilliant Idea for Helping Katrina Victims.

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