Monthly Archives: October 2006

Terex Handlers: Lean Manufacturing

Here is a short article about a company implementing lean: Terex Handlers implementing lean manufacturing [the broken link was removed]. The article doesn’t really shed any new insight but it is another good example of success (which are nice) and I like the truth behind this statement:

Increased efficiency hasn’t led to layoffs at the company. In fact, the company has gone from 65 to 118 employees since 2004.

Lean thinking is about eliminating waste not employees. Yes, a company may be able to improve so the same production requires fewer workers but the goal should be to grow the business to redeploy those people. If the company fails to make that happen, it might be necessary to layoff workers. But that is a sign of failing not successful lean thinking.
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Simple Cell Phone

Awhile back we posted about the lack of simple phones now Motorola is looking at this market. See: Motorola’s Dumb Phone:

Looking for more customers, the company did extensive market research in poor countries. The result: the company’s slimmest phone yet, boasting cutting-edge technology that–rather than adding complexity–extends battery life and makes the phone simpler to use.

I don’t think these features are only desired in poor countries, but I am not basing that on any market research just my opinion. Complex devices with many points of failure (both technical failure and user inability to figure it out) should not be the only option. Simple, easy to use, reliable devices would have a big market. Creativity is not just about more complex devices.

Lean Manufacturing Web Video

Continuous Improvement Video from Genie Industries [the broken link was removed], is an interesting lean manufacturing video (via the great Panta Rei blog):

The video also shows examples of their moving line, andon and pull chord, visual production status boards, point of use tools, pokayoke, lineside delivery of parts by suppliers, etc.

The short video gives a nice quick overview of some lean ideas with visual examples. Recommended.

Related: management webcast posts – lean thinking – more on pokayoke and other lean terms.

Deming in Japan

Great article by John Dowd [the broken link was removed], How the Japanese learned to compete:

This is a key lesson because with attention to quality, the company begins a journey on a “virtuous circle” of simultaneously improving quality and lowering costs. As quality improves, there are less rework, scrap and waste of all kinds. As products become more attuned to customers’ needs, there is less effort spent producing items people don’t want. Costs go down. Quality improves. Thus paying attention to quality becomes the primary competitive strategy. Understanding this is vitally important.

Management Improvement Search Engine

Google has launched a nice new feature that allows users to create customized search results. I have talked about this idea before: Improve Google. Last year I posted about Rollyo, which allowed what Google now does (using Yahoo for the underlying search). I liked Rollyo but the new Google offering is better, so I have switched to using Google.

Try our Management Improvement search engine

This searches, using Google technology, over 50 management improvement web sites that I have selected. Sites include: (this blog, Curious Cat Management Improvement Connections, Curious Cat Management Library…) and the best management improvement sites (in my opinion), including: The W. Edwards Deming Institute, Lean Blog, Panta Rei, Center for Quality and Productivity Improvement, Superfactory, Got Boondoggle?, In2:InThinking Network, Peter Scholtes, Center for Quality of Management, and many more. I will also be adding more; please share your suggestions.

Add the Management Improvement Search box to your site.

Lessons from Toyota’s IT Strategy

Another interesting post from Panta Rei: Lessons from Toyota’s IT Strategy [the broken link was removed]:

In order to use IT effectively as a tool, we think that it is important for the top management to not see IT as something that can be applied superficially. First they must see the facts of the business, the facts of the gemba, and on top of this foundation further consider the feelings of people and how to motivate them. Then rules must be written and standardization must be done properly on the basis of the global business framework, before IT is implemented.

The words hardly seem revolutionary. The importance, I believe is understanding how differently Toyota acts upon what it says. For more on Toyota IT see: Toyota IT Overview.

Deming Prize 2006

The Union of Japanese Scientists have announced the 2006 Deming Application Prize [the broken link was removed] winners:

Nishizawa Electric Meters Manufacturing Co., Limited (Japan)
Sanden International PTE Limited (Singapore)
Sanden International, Inc. (USA)

Also announced:
The Deming Prize for Individuals: Dr. Yoshinori Iizuka, Professor, Graduate School of Engineering, The University of Tokyo (Japan)

The Japan Quality Medal: GC Dental Products Corp. (Japan)

Recently Thailand and India had been dominating the awards: 3 of 4 in 2005, 6 of 6 in 2004, 6 of 7 in 2003, 2 of 2 in 2002 and 3 of 4 in 2001. Prior to that trend, nearly all awardees were based in Japan. Sanden International is the third USA based organization to win: Florida Power & Light Company (1989), AT&T Power Systems (1993).

Companies are eligible for the Japan Quality Medal only after they have received a Deming Prize. An official award ceremony will take place November, 7th.

Management Consulting – Web Site Evidence

In, How Wipro Adapted the Toyota Production System to IT Work [the broken link was removed], Jon Miller highlights several keys to adopting lean thinking: involve everyone, learn and then do, and learn together.

In Wipro’s case they should also take advantage of what is available on lean IT thinking such as: Lean Software Development.

As I have mentioned before a look at Wipro’s web site does not provide me much confidence in their commitment. Read their overview of IT services offered [the broken link was removed – I am not at all surprised they didn’t even follow basic web guidelines to avoid breaking urls] – just the standard language, nothing that provides details on their lean thinking. The web site of management consulting firms provides a great way to judge what they actually value. Maybe you shouldn’t judge a consulting firm by its web site but it seems like a pretty good indicator to me (even small firms can posts thoughts on a blog or a couple articles).

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Deming Institute Conference: Tom Nolan

I attended the annual W. Edwards Deming Institute conference this weekend: it was quite good. Tom Nolan [the broken link was removed] lead off the conference with: Developing and Applying Theory to Get Results.

He discussed the theory of knowledge: how we know what we know. See my attempt to introduce the idea of the theory of knowledge within Deming’s management system. It is probably the least understood of Deming’s four areas of profound knowledge, the others areas are: knowledge of variation, appreciation for a system and psychology.

Theory of knowledge is also something people have difficulty relating to what they do every day. The most obvious connection, I believe, is the understanding that much of what is “known” is not so. People manage with faulty beliefs. With an understanding of the theory of knowledge decision making can be guided to avoid the pitfalls of basing decisions on faulty beliefs. This is, of course, just one aspect of how the theory of knowledge impacts Deming’s management system.

Tom Nolan also discussed some interesting work that Paul Carlie and Clayton Christensen are doing based on descriptive “theory” and normative theory. My simple explanation is that descriptive theory reports on what is seen. This can be interesting, but has problems when people assign causation based on just observation (without experimentation). Normative theory involves testing theories (such as is done with the scientific method). Good article on this by Carlie and Christensen: The Cycles of Theory Building in Management Research [the broken link was removed].

Tom also discussed the PDSA cycle (he co-authored the best book on applying the PDSA to improve: The Improvement Guide). One point he made was that he often finds that organizations fail to properly “turn” the PDSA cycle (by running through it 5-15 times quickly and instead to one huge run through the PDSA cycle). One slow turn is much less effective then using it as intended to quickly test and adapt and test and adapt…

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Lean Canadian Company

Lean and mean might not be enough [the broken link was removed]

“I wanted all the machines working all the time,” Afeyan said as he watched a worker moving a stack of veneers into position for “cooking” in one of the pressing machines.

That was before a “lean manufacturing” exercise changed Afeyan’s mind about how his factory should be organized.

The article discusses that while great strides have been made the threat to success still exist from foreign (China) competition. And discusses that the company is trying to focus on production that is more difficult for foreign competition (short runs, small lead times). It is also one of the few articles to acknowledge that manufacturing production is up while manufacturing employment is down.

But lean manufacturing is only part of an equation that has generated dramatic gains in manufacturing productivity over the last two years. Despite the large number of layoffs in manufacturing, the volume of factory output has actually risen since 2002. The job losses are a combination of efficiency gains at existing factories and turnover that sees more efficient producers replacing those who couldn’t survive.

The plant was reorganized to bring machines together to form production cells where cross-trained workers begin and finish orders one by one. Teams of employees now take plywood and cut it, sand it, groove it, insert hardware and package it for shipping – operations that used to be executed at separate stations. Similar changes were made in the plywood manufacturing area.

Now, orders move through the factory quickly instead of stacking up.