Curious Cat Management Improvement Blog: Deming, lean thinking, innovation, customer focus, continual improvement, six sigma.
October 31, 2005

Bill Hunter and Peter Scholtes

Topic: Management Improvement

I have recently updated Peter Scholtes‘ web site (author of the Team Handbook and the Leader’s Handbook) and created a new web site for my father: Bill Hunter - williamghunter.net. They were friends and colleagues.

I frequently receive kind words from people who knew my father. A recent note:

I just thought I’d let you know how much I enjoyed your dad’s class as a grad student in 1979 at UW-Madison. I’m sure you’ve heard many comments like this, but I’ll add one more. He was a delightful and entertaining prof who clearly loved his subject. He made an impression on me one day by asking us a question about the British comedy radio program, The Goon Show, which I had heard. I think I was the only member of the class who raised his hand. After that moment, I always felt a special bond with him, because I thought it was great that he appreciated the wacky humor of that show.

I received a wonderful education at UW and your dad was no small part of it.

I have added a comments section on the site to post such notes. If you have a comment to share please send me a message to post. Even if only my relatives and I enjoy the notes, I think they are wonderful, so please send them in.

The Power of Why

NUMMI Tour Tale #3: The Power of Why by Mark Graban:

Again, another “wow” moment. For one, NUMMI put the situation in customer terms. Do not use these parts, because there would be a negative impact on the customer. It didn’t say “do not use the parts because I say so (and you wouldn’t understand the reason anyway)”.
…
Why are we doing lean? Why is it necessary to standardize our workbenches? Why is it important to get these parts off MRP and onto a kanban system? I bet we would all do better by taking the time to explain why.
October 30, 2005

Manufacturing and the Economy

In Global Market, Iowa Manufacturers Fight for Survival:

The conventional wisdom has been that expanded trade would result in the United States losing low-pay, low-skilled manufacturing jobs, said David Swenson, an economic scientist at Iowa State University. But “a lot of the jobs that we have traditionally thought of as high value, high quality, high benefits are in trouble, too.”

The conventional wisdom was that the rest of the world would not be able to compete with the United States for high wage, high value jobs. It turns out the rest of the world is much more able to compete for that work than was expected.
(more…)

The Toyota Phenomenon

The Toyota Phenomenon by Ernst Glauser:

Toyota’s success starts with its brilliant production engineering, which puts quality control in the hands of the line workers who have the power to stop the line or summon help the moment something goes wrong.

Walk into a Toyota factory in Japan or America, Derby in Britain or Valenciennes in France and you will see the same visual displays telling you everything that is going on. You will also hear the samejingles at the various work stations telling you a model is being changed, an operation has been completed or a brief halt called.

Everything is minutely synchronized; the work goes at the same steady cadence of one car a minute rolling off the final assembly line. Each operation along the way takes that time.

Shoichiro Toyoda, Honorary Chairman and director of Toyota Motor Corp.: “There is not a day I don’t think about what Dr. Deming meant to us. Deming is the core of our management.”
October 29, 2005

Deming Review Postcasts

Postcast on W. Edwards Deming by Paul C. Palmes.

This is the first of three programs dedicated to the teachings of W. Edwards Deming. The Internet has numerous websites devoted to his thoughts and methods. I strongly suggest that you avail yourself of many of these offerings if this and programs that follow stir your interest

As I mentioned previous I see potential for podcasts as another tool to improve learning of management ideas:

October 28, 2005

Management Training Program

Fog Creek Software Management Training Program by Joel Spolsky:

Finally, when you’re really really good, they let you hang around with Yussef on the ovens. Yussef was about 100 years old and so good at running the ovens it was scary. When Gabbi tried to show me how to solve the problem of bread sticking to the conveyer belts on the way out of the oven, he ran back and forth like a lunatic for ten minutes, turning knobs, pulling levers, redirecting heat, and burning a few hundred loaves while he struggled to get things under control.

But Yussef, facing the same problem, turned one tiny knob on a seemingly-unrelated chimney about one degree to the right. It made no sense, he couldn’t explain why it worked, but it did: it solved the problem instantly and suddenly perfect loaves started popping out. It took me another couple of years to really understand the complex relationships between heat and humidity inside an 80 foot tunnel oven, but it would have taken ten more years before I could solve problems as well as Yussef did.

From the Lion of Lean (an interview with James Womack):

So I said to the Toyota executive, “You’ve only got two or three suppliers per category, and you never take bids. How do you know you aren’t being ripped off?” So this guy, who was around 60, gives me an incredibly frosty look and says, “Because I know everything.” Everything? “That’s my job,” he says.

(more…)

October 27, 2005

Toyota Manufactures More Itself

Bucking the trend, Toyota controls quality, cost by making many parts in house, AutoWeek via Lean Manufacturing Blog:

On one hand, the company sees parts making as a critical piece of its overall quality-control program. Toyota argues that keeping some parts in-house actually makes it more efficient. Outsourcing parts simply to meet the changing industry norm is viewed warily by Toyota executives.

“I don’t believe we can outsource our responsibility to the customer,” Seizo Okamoto

(more…)

New Business Ideas Take Time

New Business Ideas Take Time by Edward DeBono

Some types of change carry more immediate benefits, such as problem-solving. The problem is disrupting a system or individuals, so solving that problem is of instant benefit. Even in cases where the benefits are not immediate, they can be predicted easily.

Because of this, management thinking is too preoccupied with problem-solving.

Good point. This is true for at least too reasons: short term thinking and the desire to have a measure of success. It is much easier to find a measurement of the benefit of eliminating some problem than the benefits of learning and taking more time to think. As Lloyd S. Nelson said many of “the most important figures that one needs for management are unknown or unknowable.”

All businesses should appoint a ‘Simplicity Officer’. This person should encourage and refine business ideas for the simplifying of processes. Simplicity requires a deliberate effort as continuity is the natural instinct of organisations.

Sounds very much like lean thinking to me.

The Power of Teams

The Power of Teams, by Lynn Witten:

Train team leaders and members. It is critical to provide training and guidance to people on how to function as effective team members and leaders. In addition, problem-solving training can give teams and team leaders a structured approach to finding solutions. It can help teams overcome members’ natural defensiveness and finger-pointing.

Evaluate incentive systems. Many incentive systems have been established to reward individual effort or effort from one functional area. In team-based systems, rewards need to recognize the impact of a team’s performance on the whole system.

October 26, 2005

Lean Principles in Health Care

“Lean” principles apply to health care, by Donna Daniel:

Making the shift to a lean enterprise, whether it’s in a hospital, a physician practice or a nursing home, isn’t easy. Like any culture shift, it will require commitment and time. There may be resistance, especially given the complex nature of health care. But stay the course.

Lean has a successful track record in many industries so you will need to provide education, communication and reinforcement throughout the process. Lean may be challenging to implement at first, but it may be the best investment your organization can make to improve financial performance and the quality of care you deliver to your most important customers — your patients.

Prevoius related posts:

Health Care Improvement Articles

OpenOffice 2.0

Topic: Software - Open Source - Freeware

OpenOffice 2.0, the excellent freeware office suite is now available. It is great free software that imports Microsoft formatted documents and creates the same amazingly well.

Open Office runs on Apple, Linux, Microsoft and more operating systems and installs easily. One nice feature is that you can create pdf documents from any file (text, spreadsheet, presentation) with the click of one button. They also added a new database in release 2.0.

I’ve used the previous edition for quite some time and think it is very good; it is amazing such a product is free. More excellent freeware: Firefox and Picassa (for photos).

Go Lean to Remain Competitive

Go Lean to Remain Competitive:

Captains of industry should adopt Lean Production Systems, an idea {conceived} by Toyota for its car-making, to transform their plants to efficient ones, for survival in the globalisation era

Sundaram Clayton Limited Brakes Division President C N Prasa.

In 1998 the SCL Brakes Division won the Deming Prize and in 2002 they won the Japan Quality Medal.

Sundaram-Clayton Limited, Mission:

We are committed to being a profitable and socially responsible leading manufacturer of environmentally friendly auto components and sub-systems for customers in markets and to provide fulfillment and prosperity for customers, employees and suppliers.

India has been represented very well among Deming Prize winners the last few years including 3 of 4 winners this year.

I think it will be interesting to see if this is a sign of a broader adoption of such management principles in India. If so, I think that would compliment the software industry in promoting continued economic development in India quite well. And, if so, in 10 years I think we will be hearing much more about manufacturing in India than we do today.

More articles on Management Improvement in India (including several on Sundaram Clayton Limited).

October 25, 2005

Why Fix the Escalator?

Why Fix the Escalator? from the Lean manufacturing blog on a visit to the NUMMI plant:

A very large permanent sign above the escalator said something like:

“Sorry for inoperative escalator. It would cost $120k to repair. We feel money could be better spent on other things. Please accept our apologies.”

Wow. The frugality and practicality of TPS was illustrated by that sign, our tour group thought. Rather than a knee-jerk reaction of fixing it when broken, somebody asked that powerful question: “Why?”
…
Another question I’m challenging myself with: If this had been a GM plant, would I be criticizing them for being cheap?

Good points and questions. I have another question, why was the escalator put there in the first place? I did not visit the plant but it sounds like it isn’t needed. Did something change, or was it a wasteful decision in the first place?
(more…)

Lean Development

Lean Development, by Freddy Ballé and Michael Ballé. Great article.

According to a National Center for Manufacturing Sciences report, Toyota product development projects can take half the time of US equivalents, with four times their productivity (150 product engineers utilised by Toyota per car programme versus 600 for twice as long at Chrysler).
As with implementing the Toyota production system, a more precise understanding of development practices doesn’’t necessarily help to improve the efficiency of engineering projects for a number of reasons. First, it is not a collection of best practices which can be implemented piecemeal, but a system. Furthermore, a clearer understanding of the system also shines a different light on the practices themselves, and, in many cases, changes their intended purpose. As such, many of the Toyota practices only make sense in the light of the overall system.

Great point. It would be wonderful if more people could learn this.

Going Beyond (or away from) Lean Thinking?

Topic: Management Improvement

Continuous Improvement - Lean Alone No Longer Cutting It by Tonya Vinas, IndustryWeek:

It’s a dicey time for manufacturers that have spent the past five to 10 years on the lean journey. They and their top-level executives are finding that lean alone is not enough.

Well I would agree “lean,” as it is commonly implemented, is not enough. I believe additionaly ideas from Deming that are missing from many lean efforts would be helpful (Toyota applies Deming’s ideas to a much greater extent than those modifying Toyota’s practices for their organization). Those concepts will mainly aid long term continual improvement of the organization (rather than provide short term quick fixes).

I think [what is] also happening is a demand for immediate cost cutting that lean doesn’t always provide. Sometimes kaizen events result in immediate savings, but in the face of the increases these companies are facing, kaizen-derived savings are, again, probably not deep enough, especially with the allure of incredibly cheap labor in China.

I think moves away from lean, that are the result of gut reactions to such worries, are likely. Also I feel that the rapidly movement of managers and their desire to “make their mark” in their new job, results in new managers making changes (away from lean) mainly to show the impact they have (or because they are not familiar or comfortable with lean concepts). Neither are good reasons for changes, in my opinion.

I think the article raises some interesting questions. I, also, believe the practice of lean is increasing. I would be interested if the readers of our blog think lean thinking is increasing or is on the decline.

October 24, 2005

Deming’s Ideas at Markey’s Audio Visual

Last week at the Deming Institute seminar: How to Create Unethical, Ineffective Organizations That Go Out of Business, Mark Miller, General Manager, Markey’s Audio Visual spoke on Markey’s experience adopting Deming’s ideas.

It was a great presentation. He did a great job of explaining what it was like to work at a company focused on applying Deming’s management philosophy. I capture some of the points he talked about below.

1986 Markey’s started providing Audio Visual support to all Deming’s seminars. The technicians came back after 3 sessions to encourage Mark Miller (employee number 16 at Markey’s) to attend, himself. He went to a Deming 4 day and decided the owners should attend. They did and then Markey’s sent employees to attend future Deming 4 day seminars.

He recommended, The Team Handbook and The Leader’s Handbook by Peter Scholtes.

Points:

  • Constancy of Purpose
  • Their business has greatly changed. Customers used to need a service provider to project onto a screen,– now they all own projectors for laptops‚ Markey’s needs to anticipate the changing needs of customers and anticipate those needs
  • Page 141 of Out of the Crisis: “Profit in business comes from repeat customers, customers that boast about your product of service” (Markey’s uses Deming’s books in the training for staff)

    • (more…)

Types of Pull Systems

Pull Systems Must Fit Your Production Needs:

Mixed Supermarket and Sequential Pull System
The supermarket and sequential pull systems may be used together in a mixed system, also known as a C-type pull system. A mixed system may be appropriate when the 80/20 rule applies, with a small percentage of part numbers (perhaps 20%) accounting for the majority (perhaps 80%) of daily production volume. Often an analysis is performed to segment part numbers by volume into (A) high, (B) medium, (C) low, and (D) infrequent orders. Type D may represent special order or service parts. To handle these low-running items, a special type D kanban may be created to represent not a specific part number but rather an amount of capacity. The sequence of production for the type D products is then determined by the method the scheduling department uses for sequential pull system part numbers.
October 23, 2005

Statistical and Scientifc Thinking Blog

Another good new blog on Statistical and Scientifc Thinking that is discusses the application of Deming’s ideas, by John Dowd. Short quotes from two posts:

The predictions made on the job are usually a lot less obvious and in most cases managers may not even be aware of the fact that they are making predictions. For example, much of management time is spent reacting to events. Some problem takes place and it’s management’s job to fix it. Some process of assessment is done and then a ‘corrective action plan’ is put into place.

So where’s the prediction.The plan is the prediction. The plan is developed in the hope if carried out in the proper way, some desirable result will occur that will eliminate the problem, solve it, or whatever. That plan is picked (one would hope) as being the one most likely to bring about the desired outcome.

Shewhart went at the problem a different way. He was trying to determine what the characteristics of process behavior were and began studying the output of different types of systems to see what happened. Knowing that the variability of processes took place over time, he began plotting time-series charts (sometimes called Run Charts) to see what patterns of the variation looked like.

Previous Curious Cat posts on similar topics:

October 22, 2005

Improvement at UTC

Mike Beck gave an excellent presentation at the Deming Institute conference about the United Technology Corporation management improvement system. I plan on posting more about the session. But for now, here is article that has some details on what UTC has done.

The Unsung CEO, Business Week, cover story Oct, 2004:

David has racked up these results despite his penchant for controversial investments that don’t directly benefit the bottom line, at least not within any normal time horizon. His Employee Scholar Program costs a cool $60 million a year, and workers don’t even have to tie their studies to the job. Anything goes, from medieval poetry to medical training, with UTC picking up the tab, including the cost of books and time off.
…
The program covers every employee, from the veteran elevator technician in Zimbabwe to a fresh-scrubbed office assistant in Tyler, Tex., with some education benefits even extending to laid-off workers. And, for each degree earned, employees get up to $10,000 in UTC stock or options.

Dr. Deming advocated such a commitment to education. I don’t know of any company putting this much money behind the concept.
(more…)

October 20, 2005

2005 Deming Prize

2005 the Deming Prize Winners Announced:

The Deming Application Prize (alphabetical order)

Hosei Brake Industry Co., Limited(Japan) - web site
Krishna Maruti Limited, Seat Division(India)
Rane Engine Valves Limited(India) - web site
Rane TRW Steering Systems Limited, Steering Gear Division(India) - web site

Once again India has dominated the prize. From our 2004 Deming Prize post: “In recent years, Thailand and India have been the home to nearly all awardees: 6 of 7 in 2003, 2 of 2 in 2002 and 3 of 4 in 2001. Prior to this new trend, nearly all awardees were based in Japan,”

Also announced:
The Deming Prize for Individuals Mr. Hajime Sasaki, Chairman of the Board, NEC Corporation (Japan) - bio

The Japan Quality Medal
Thai Acrylic Fibre Co., Limited (Thailand) - web site (2001 Deming Prize)

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