Monthly Archives: July 2012

Corporate Social Responsibility

This month Paul Borawski (CEO of ASQ) has asked the ASQ Influential Voices to share their thoughts on the Intersection of Quality and Social Responsibility.

An understanding of system thinking allows people to see the relationships of connected elements in a system. As you gain the insight provided by such knowledge, the ignorance of connections seems odd. It is hard to have an appreciation for systems thinking and not appreciate the fundamental interconnection between people, corporations and society.

Respect for people is another management principle that extends to social responsibility. Some companies may see respect for people as only respect for workers but a wiser approach is to view it as respect for all people (as Deming, Toyota, Patagonia and many others do).

Society makes the rules for how we live together. Corporations are allowed because society decided there was a benefit to society to allow them. One can argue the benefit to society is entirely independent of social responsibility. The argument that by ignoring the reason they are allowed to exist will result in that aim being met effectively isn’t what any quality management flavor I know of would suggest.

In the time of the robber barons in the 19th century those leading corporations tried to make the claim that the business world was amoral (morality didn’t apply in that realm). As a society we rejected that assertion. Society has decided morality and ethics do apply to business leaders. Even if so many business leaders themselves show a shocking failure to act ethically in practice (see the endless line of banking executive failures, etc.). The attitude of so many current CEO’s (that you deserve whatever you can take and if you are not caught and stopped it was fine) is passed onto those they work closely with. It is no wonder those people, that are suppose to be leading the organization, instead are just bleeding the organization for whatever they can get away with. That result is very likely when you fail to encourage systems thinking and respect for people (inside and outside the company).

There are many reasons for a corporation to be moral and practice social responsibility but the most important is that is it the ethical thing to do. In addition to that it will be effective. When you create a culture that treats the system as it doesn’t matter that is damaging. We currently do a bad job of systems thinking in general. Building an appreciation for systems thinking will provide great benefits. Ignoring the system impacts so you can justify unethical behavior is damaging.

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Value Stream Mapping for Fun and Profit

Guest post by Evan Durant, author of the Kaizen Notebook blog.

I tend to get a little preachy about the importance of value stream maps, but they really can be useful tools not only to plan an improvement effort but also to monitor your progress going forward. In particular they provide a way to quantify the impact of changes to your process. Here’s a real life example as a case in point.

For a particular value stream a team went to gemba, followed the flow of material and information, collected process cycle times, and counted inventory. When everything was mapped and all the data tallied, here was the current state that they came up with:

Total Lead Time:
16.8 days
Process Lead Time: 2.2 days
Process Time: 1.9 days
Operator Cycle Time: 8.2 minutes

So what does all this mean? First of all the Total Lead Time represents the amount of time that a new piece of raw material would take to enter the value stream, be worked on, wait around with all the rest of the material in process, and then finally make its way to the customer. This number is usually driven higher by large amounts of in-process inventory caused by pushing between operations.

Second, the Process Lead Time is the amount of time it would take to process a single batch through the process, if it didn’t have to wait behind any other batches. Note that even though parts are processed one at a time through all of the manual operations, a certain amount of batching is required to overcome long machine cycle times in automatic operations. Also we do not ship parts to the customer one at a time, but rather in standard package sizes.

Third, we have the Process Time. This is the total amount of value added time, manual and automatic processing, that a part sees in the value stream.

Finally the Operator Cycle Time (also called manual time) is the amount of actual “touch” time required to make a part. The difference between the Process Time and the Operator Cycle Time is the Machine Cycle Time (also called automatic time). This is when a batch of parts is on a machine that does not require any operator intervention during a cycle. (We have a lot of machine cycle time in this value stream.)

Then the team applied the concepts of flow and pull to reduce overproduction and pace the value stream to the rate of customer demand. The results of the future state map were as follows:

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Curious Cat Management Improvement Blog Carnival #173

The Curious Cat management carnival is published 3 times a month highlighting some recent management blog posts. The posts generally focus on the areas I have focused on in the Curious Cat Management Improvement Guide since 1996.

I added a page on our blog showing the most recent blog post from a large number of management blogs.

  • Software Inventory by Joel Spolsky – “Trello works great for a reasonable amount of inventory, but it intentionally starts to get klunky if you have too many cards in one list. And that’s exactly the point: it makes inventory visible so that you know when it’s starting to pile up.” (I use Trello, and like it, at Hexawise where I am a consultant – John)
  • You don’t “do Lean” by Paul Levy – “Lean is not a program. It is a long-term philosophy of corporate leadership and organization that is based, above all, on respect shown to front-line staff.”
  • Queueing Theory at Chipotle by Evan Durant – “I like Chipotle for several reasons, not the least of which is the fact that they have hands-down the greatest food service process in the industry. I could talk about standard work, flow, material replenishment, customer focus, and a whole bunch of other lean stuff”
  • Microsoft’s Downfall: Inside the Executive E-mails and Cannibalistic Culture That Felled a Tech Giant – “‘Every current and former Microsoft employee I interviewed—every one—cited stack ranking as the most destructive process inside of Microsoft, something that drove out untold numbers of employees,’ Eichenwald writes… ‘It leads to employees focusing on competing with each other rather than competing with other companies.'” [This is exactly what Dr. Deming said would happen and even the current head of HR that lead this process said she was going to get rid of it when she started at Microsoft – John]
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Simple Customer Care: Communicate

Some management issues are hard. You are often balancing priorities. Sometimes though it is extremely simple: either you have concern for customers and take actions to back that up or you have some concern but don’t do anything about it.

Here are some examples that show you really just don’t care.

If you have invested millions in setting up computer systems to authorize, and reject, payments for say a credit card and you fail to notify customers when you reject a charge you just really don’t care. There might have been an excuse 10 years ago that it was too difficult to notify people. Today if your IT people can’t do that, hire a new CIO and have them create an IT support system that isn’t an embarrassment to any institution relying on it.

Another sign of an extremely weak IT and customer focus presence in an organization would be deleting records of your customers after 6 month or 1 year or ever. Again this is common among the too-big-to-fail financial institutions that seem much more able to design system to extract fees and justify ludicrous bonuses to executives than to provide the most basic services for customers.

Amazon, and most any non financial-too-big-too-fail institution, keeps your records available for you. The too-big-too-fail crowd though won’t keep records as well as the site you buy books from. They slap fees on customers if they want to get the paper statements they used to get for free. That is fine with me (the fees are far too high, but the concept is fine with me). The too-big-too-fail crowd wants to save money by not mailing you paper. Fine.

Then, deciding to delete your records after 6 months, or a year… is just a sign you have no interest in serving customers. Other than an organization that has no interest in customer service, suggesting such a thing would be a direct ticket to remedial training on providing value to customers.

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Management Improvement Blog Carnival #172

Christian Paulsen is hosting the 172nd Management Improvement Carnival. Highlights include:

  • Waves at Old Lean Dude: Bruce Hamilton (a.k.a. the Toast Guy) writes about surges in production and work load that are self-inflicted. One of the 14 Toyota Way principles is to level-out the work load. Waves of work or production is not Lean or effective.
  • Error Proofing at Beyond Lean: Matt Wrye often sees Lean applications in the real world and not just in the manufacturing plant. He brings these examples to his blog illustrating how to be Lean. He was having fun with charts in a recent post.
  • Why do you ask? at Gemba Tales: Mark Hamel compares the Leader as a Fixer to the Leader as a Teacher. Mark’s blog demonstrates the difference well and provides the kind of questions teachers should be asking.

Customer Focus

Customer Focus is at the core of a well managed company. Sadly many companies fail to serve their customers well. To serve customers, a thorough understanding of what problem you solve for customers is needed. The decisions at many companies, unfortunately, are far removed from this understanding.

It is hard to imagine, as you are forced to wind your way through the processes many companies squeeze you through that they have paid any attention to what it is like to be a customer of their processes. When you see companies that have put some effort into customer focus it is startling how refreshing it is (which is a sad statement for how poorly many companies are doing).

If the decision makers in a company are not experiencing the company’s products and services as a customer would that is a big weakness. You need to correct that or put a great amount of energy into overcoming that problems.

Another critical area of customer focus is to know how your customers use your products. It isn’t enough to know how you want your products to be used. Or to know the problems you intended people to use your products for. You need to know how people are actually using them. You need to know what they love, what they expect, what they hate, and what they wish for. This knowledge can help offset experiencing the products and services yourselves (in some cases getting that experience can be quite difficult – in which case you need to put extra effort into learning the actual experience of your customers).

You cannot rely on what people tell you in surveys. You need to have a deep understanding of customers use of the products. Innovation springs from this deep understanding and your expertise in the practice of delivering services and building products.

One of my favorite improvement tips is to: ask customers what 1 thing could we do better. It is very simple and gives you an easy way to capture what customers really care about. You shouldn’t rely only on this, but it is an extremely powerful tactic to use to aid continual improvement (with customer focus).

Related: Delighting CustomersThe Customer is the Purpose of Our WorkCustomer Focus and Internet Travel Search

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Management Improvement Blog Carnival #171

The Curious Cat Management Improvement Blog Carnival has been published since 2006. We find great management blog posts and share them with you 3 times a month. We hope you find these post interesting and find some new blogs to start reading. Follow me online: Google+, Twitter, Reddit, and more.

  • Ticket Grab: New Game at Caine’s Arcade + 5 lessons for entrepreneurs – 5 Lessons for Entrepreneurs Caine (shown is video above) has Learned: 1) Be nice to customers. 2) Do a business that is fun. 3) Do not give up. 4) Start with what you have. 5) Use recycled stuff. Caine is 9 by the way.
  • How I hire writers by Hitesh Sarda – “We spend a quick 10-15 min assessing if the candidate deserves our time and next interview round or not. My favourite questions include: spelling of conscientious, explain oxford comma… Once I am convinced of their hold on words, we move to round 3… Here we take a deep dive into the writers command over the intricacy of the language. Sample questions: Question on lexical roots of some words. More spellings and grammar questions….” 🙂
  • Without work standards there can be no kaizens by Tracey Richardson – “When was at Toyota those actions were things like – Go See, Respect for people, Continuous Improvement, Teamwork, and Challenge, these were values that could be translated into an action a leader could show from top management down to a team member level, this creates the consistency for the values and principles to become the belief system for the organization that its more than just words on the wall in the lobby.”
  • Innovation at Bell Labs by Michael McKinney – “Humans all suffered from a terrible habit of shoving new ideas into old paradigms. ‘Everyone faces the future with their eyes firmly on the past and they don’t see what’s going to happen next,’ observed John Pierce.”
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