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The Current State: Progress Starts Here

 

On the lean journey, understanding the current state of your company is critical to success


By Dennis Pawley
Founder and Partner,
and Jamie Flinchbaugh,
Founder and Partner
The Lean Learning Center
Novi, MI
www.LeanLearningCenter.com 

 

Imagine you are blindfolded, travel for hours by plane and car, and then are dropped off in the middle of a dark forest. You must get home. You know exactly where home is. But you have no idea where you are.

Pretty challenging, but that's exactly what most work being done for business and process improvement is like. Companies have great visions for their business or a single process. They know what good looks like. They have benchmarked and know the current "best-in-class." But they lack a vital ingredient to complete this great journey—a deep understanding of their current state. We are inherently bad at this. Regardless of the topic, it always seems that 90% of people believe they are above average. Only our poor understanding of the current state is behind this obvious paradox.

While understanding the current state is an important skill in all business operations, on the lean journey it's particularly vital. As part of your lean implementation, you might install a polished pull system, apply the 5Ss and visual management, and begin solving problems daily in front-line and cross-functional teams, but find that you're not moving forward at the pace you anticipated. At the root cause of this issue, there is often the lack of an embedded skill and practice needed to deeply understand the current state. This practice is equally important across many business success factors—your processes, your strategy, your customers, your team, your culture. For the sake of focus, we will primarily discuss understanding the current state of your processes, whatever they may be. There are two important reasons why this skill is such a fundamental practice of lean transformation.

  • There's gold in them there hills! What's the value of the current state of your process? After all, your goal is to make the current state obsolete by rapid continuous improvement. Why would anyone spend so much time on something that's going to change? The current state has gold in it, not necessarily in terms of results, but in learning. The current state is the product of every experiment and failure of the past many years, or even decades.

In the early 1990's, the best-selling book Re-engineering the Corporation by Hammer and Champy advocated throwing out the current state. "Take out a clean sheet of paper," they advocated, "and design your processes from scratch." After this approach led to many failures—some on a grand scale—Hammer, to his credit, reversed himself. It turns out that understanding the current state is quite valuable.

Think about this: you are doing something right. If you did nothing right, your company would no longer exist. If you throw away the current state, imagine how many good things might be lost. Of course, it's important not only to understand what is currently working, but why it is working. Too often we employ "if it ain't broke, don't fix it." But that mantra too often seems to morph into "don't mess with it in any way, including understanding it." Second, you have made, and are currently making, many mistakes. Without understanding those mistakes in such depth that they can be fixed, they are bound to be repeated. Put these two conditions together, and you can see why trying to fix a process without understanding the good and bad of the current state often leads to a very deficient future state.

  • Building tension generates progress. Tension is not stress. Unproductive pushing leads to stress. Stress means that we know we aren't where we need to be, but don't know where to go or how to get there. It means that we are truly lost. Productive urging paves the way for tension. Tension is the kind of energy that drives people forward. Pushing is necessary for change. Without any kind of a push, organizations remain stagnant. You need three elements to generate positive creative tension: a vision of the ideal state, a clear grasp and hatred of the current reality, and the right skills, capability, and actions necessary to close the resulting gap.

All three elements are required for progress. If any of them are missing, no matter how powerful the remaining forces, productive tension will not be created. If you hate the current state, but have no vision or action, you will end up with energy-draining frustration. If you have action, without vision or understanding of the current state, you will likely create confusion because of lack of direction. And if you have a vision, but no action and no understanding of the current state, you will stand alone as an idealist, wondering why no one is joining you on your quest.

The hardest element to master, and a precursor to the other two elements, is deep understanding of the current state. Embedded in your current state are most of the insights required to tell you where you must go, and what actions are most likely to get you there. You don't need more creativity or more bold actions—you need better insights into where you are now.

What prevents people from understanding the current state? Why is such understanding not more prevalent? There are three flaws in the current practices that act as barriers to success in this arena.

The first flaw is that most efforts at understanding current reality focus on results. Results are important. After all, we are exploring this topic because we want to achieve better results. Focusing on the current state through results, whether the results are data, stories, or reports, rarely leads to the insights required to make progress. They might tell you what is broken, how badly, and possibly even where. But the key question is why. To achieve this insight, we must focus on understanding the means—the how—that produces those ends.

Even when we focus on the process itself the second flaw is that we rarely do more than gain a narrow, reactionary understanding of what is going on and why. This doesn't mean that we fail to spend time on the shop floor, but that we don't stand still long enough to truly observe.

When author Jamie Flinchbaugh started his first supervisory role in a large factory, he was proud of the fact that he spent most of his time on the factory floor for 9–12 hr/day. He moved rapidly from place to place, wearing holes in his shoes and covering many miles. He was focused on the current state, but didn't stop any longer than he thought necessary to grasp it. Once Flinchbaugh had his data, story, or observation, he moved on. He later learned that while time on the shop floor is good, what he was doing is what we now call "industrial tourism." It's a great view, but does not result in tangible change. Understanding the current state requires much more than a cursory walk-by.

The third flaw is that too often our observations are disconnected in both time and space from the occurrence of the process or problem, and equally disconnected from the resulting decision. If a problem occurs at 2 PM on Wednesday, then the most valuable information is available right then and there, at the time and location of the problem. But, too often, the analysis doesn't begin until much later, whether it is later that day or the following month. Discussion in a conference room is of no value if the current state isn't already deeply understood.

The problem is inherent to our organizations, and their processes, which do not enable us to observe when and where the problems or opportunities occur. We will address this challenge later.

Process mapping at all levels, including value stream mapping, is a commonly used practice. We often fail, however, to get the full value out of these exercises. What's the purpose of mapping? The primary purpose is to generate understanding. But, in practice, the focus ends up more on the goal of building the map itself. Too often map-building is delegated to an engineer or junior staff. In the worst cases, managers ask consulting companies to build the map for them. Who gains an understanding of the process from this exercise? Whoever built the map gains the most.

The map is not the important part of this process. What's important is the exercise of having the team discussion that generates understanding. This understanding leads to new insights and, ultimately, productive decision making. The goal of mapping is to bring people together who have different perspectives and understanding to generate one common view of the current state of the process.

Try this very short exercise. With someone sitting across the table from you, draw a clockwise circle in the air, and ask the other person what they see. They will obviously see a counterclockwise circle. Who's right? You both are, from your point of view. If we combine both views, we get a more complete and accurate view of what's currently happening. Often, if we ask a company or plant management team what's the main problem, we get different answers from the financial person, the production person, the quality person, the sales person, and so on. They are all likely to be accurate in their representations, but also all incomplete. The idea of building a map is to collect all of these partial views into one holistic picture that represents the current state better than can any one person.

A popular phrase in lean circles is "go to the gemba" or versions of that. The idea is to go to the shop floor, or the process, and see for yourself. Companies put millions of dollars into computer systems designed to help them collect and sort data to tell them what's going on. But we fail to effectively use the one tool that most of us already have: our eyes.

The important point is not whether we go to the shop floor. It is not about being seen, or establishing one's presence. The essence of this concept is how we do it.

Many years ago a concept called Management by Wandering Around (MBWA) became popular. The idea was the manager should get up and get out, go mingle, talk to people, influence others in the hallways. Unfortunately, most people approach MBWA without the requisite skill or framework to effectively observe. Without that capability, MBWA becomes industrial tourism. The tour was great, but you didn't accomplish much.

Direct observation of work requires three things. The first is intent. You must observe with a specific intention. That intention is usually to find an answer to a question, whether that question is "where is the waste in this process?" or something more specific such as "why is this process 5% over cycle?" The second requirement is a framework. You have to be able to digest what you see. You must dissect the observation, to see not just the people and equipment, but also the activities, connections between resources, and flows of information, material, and people. The third requirement is an appreciation for the depth of observation required. Taiichi Ohno, father of the Toyota Production System, would require a student to stand in a single spot for hours at a time until they truly understood what they saw. We see this commitment to observation as the greatest hurdle we face when trying to understand the current state. It's difficult for someone to stop and observe for 30 seconds, so five minutes of observation seems excessive to many people, and several hours seems unimaginable.

Directly observing work is a skill, but it's also a belief. As a belief, it drives how you behave. It means putting the quality of information ahead of the quantity of information. It means focusing on observable fact and not detached stories or past experience.

Most people learn about the importance of waste elimination five minutes into their lean journey. But few people internalize waste elimination and use it as a daily lens and language for their organization. Many organizations say they are lean, but when we ask about how often they go on a waste walk, they don't even understand the question.

Waste elimination is not just a theoretical framework used to explain all the lean solutions to problems such as setup reduction or pull systems. It is a belief that drives the organization every day. It focuses the organization on customer value, maximizing value and minimizing anything that gets in the way of delivering that value. The principle of waste elimination should be used on a daily basis.

A waste walk is a simple act to enable this principle. Only a few factors are critical for success. First, you need to dedicate the time. You can't teach everyone about waste, and then hope it happens organically. You must dedicate time and energy to go out in search of waste (it's not hard to find). Second, you need focus. Focus on a particular issue, such as information flows, or focus on an area, such as a manufacturing cell. This will also help you focus on the action. Third, separate, even if briefly, the act of seeing the waste and eliminating it. Too often, we provide knee-jerk reactionary solutions. When we focus on observation first, it allows us to understand first, and then fix it. And fourth, use the language and lens of waste.

This last is more important than many people believe. Using the language of the seven wastes (or eight, or nine, or whatever you prefer) is vital, because the language gives us both a lens to see with and a means to communicate. If we just run around talking about waste here and waste there, we aren't as effective as we could be. Having the words to explain waste helps focus our attention on what we are seeing. Memorize and internalize the language of the seven wastes. It's like putting on a different pair of glasses.

As we indicated earlier, it's most important to observe the situation when and where the problem or opportunity occurs. But without cloning ourselves, how is this possible? The solution lies in a better understanding of many of the lean solutions you already know. Embedded in common tools and practices such as pull systems, the 5Ss and Standardized Work is information that enables the process to tell us when there is an abnormal condition. This capability is our trigger to begin our observations.

Consider pull systems. Here is a scary idea that is counterintuitive for most people: Implementing pull production will make your process more fragile. Who wants that? Think about why you have so much inventory in the first place. It's there to protect you from problems, problems of all types. Inventory can protect us from unpredictable customer needs, internal process problems such as downtime, and disruptions in our supply chain. When that inventory is there, however, we do not have to deal with that problem immediately. Once pull is implemented, we no longer have our security blanket. When problems occur, we must intervene immediately or our company feels the pain. This is the forcing function that makes you fragile at the onset. But as you solve that problem, it makes you stronger and stronger with each new problem. The beautiful part: the pull system does some of this work for us. While the pull system operates, it does the investigation needed to find the problems, wherever they may hide. As the problem occurs, it shows up when those customer-supplier connections break. Our fragile system starts to crack, and then we know it is time to go to work.

Overall, we must focus on designing work processes to do two things. The first is obvious—to deliver on their objective as effectively and efficiently as possible. But the second objective is just as important—to create visibility and help us see problems as they occur, and find opportunities that we couldn't see otherwise. In other words, design our process to tell us the current state. Many lean tools have this built in, if only we used them properly. As described above, pull systems do much to help us see problems as they eliminate waste through their implementation. Other standardization tools, for example 5S and Standard Work Instructions, not only provide repeatable success, but test the effectiveness of the current state with every step. And lean improvement tools such as kaizen or value-stream mapping always begin with a thorough digestion of the current reality.

The ability to observe is not complete without reflection. Reflection is the ability of an individual or organization to internalize experiences, to learn from them for the benefit of more effective actions and decisions. Most organizations do not highly value reflection. It's not considered "real" work, and therefore most reflection is done on the drive home from the plant or office. During that drive the benefits of reflection are washed away, and no results are achieved. Reflection is the most important act of leadership.

We recommend to companies the rear-view-mirror exercise. Imagine you are driving a race car. Where do you focus? You must look out in front, for the next turn or obstacle. You must look side to side, to see who's alongside you. And you must look in your rear view mirror to see who's coming up from behind, because drivers in the rear will work the hardest to make progress.

Learn from your own past. Reflect after every step along the way. You can learn from what happened yesterday and what happened five years ago, if you look deeply enough, ask the right questions, and most importantly, take action on what you have learned. Reflection for the sake of reflection is waste. Reflection for the sake of better actions and decisions is a hidden force of lean transformation.

 

Dennis Pawley and Jamie Flinchbaugh

Flinchbaugh and Pawley are cofounders and partners at The Lean Learning Center, along with Andy Carlino. Dennis Pawley served as Executive Vice President of Manufacturing and Labor Relations for DaimlerChrysler in North America. His leadership of the Chrysler Operating System brought major performance improvement to the organization. Jamie Flinchbaugh has been helping companies achieve successful lean transformation for 14 years, and has had a wide range of operational roles. With Andy Carlino, he is the co-author of The Hitchhiker's Guide to Lean: Lessons from the Road, published by SME. For more information on the ideas in this article, contact Jamie Flinchbaugh by e-mail at Jamie@leanlearningcenter.com.  


Dennis Pawley




Jamie Flinchbaugh
 

This article was first published in the October 2006 edition of Manufacturing Engineering magazine.


Published Date : 10/1/2006

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