Lean Leaders

What is a ‘Lean Leader?’ What type of leader is needed to successfully implement Lean? Lou English, a noted Lean consultant, shares his thoughts on this:

“Which brings us to the remarkable and rare characteristics of the "Lean Leader". This is a person who first and foremost is willing to learn. Willing to admit that they don't know the answer in a traditional culture that rewards them for having all the answers. This is a person who is willing to see, go to the place where the problem is occurring and actual see what is happening. This in a traditional culture that says the further you are away from the place of production the more successful you are.

”The Lean Leader is a person who is willing to dismiss all the "success rules"(loyalty, reactivity, financial analysis...) that got them the position they have today. They have the courage to replace those "success rules" with new ones, based on a very different premises about mass production and people. This in turn threatens everyone's status, accomplishments and knowledge about the best way to manage the business.

”In my opinion this lack of Leadership is why the Lean way of doing business is struggling to take hold in this country and Europe. It’s not the tools. They have been around for 50+ years. It is the Leadership with its ROI, you do it first mentality. When what is needed is the ability to understand and lead from a new set of principles and the courage to follow through even when the data doesn't justify it. Rare stuff. “

Lou English PhD. NWLEAN: Digest Number 1816, Nov. 2, 2007

Ten Basic Rules for Practicing Kaizen

1. Discard conventional rigid thinking about production.
2. Think of how to do it, not why it cannot be done.
3. Do not make excuses. Start by questioning current practices.
4. Do not seek perfection. Do it right away even if for only 50% of the target.
5. Correct mistakes at once.
6. Do not spend money for Kaizen.
7. Wisdom is brought out when faced with hardship.
8. Ask “why?” five times and seek the root cause.
9. Seek the wisdom of ten people rather than the knowledge of one.
10. Remember that opportunities for Kaizen are infinite.

Masaaki Imai

Lean Savings is not Cost Cutting

Pursuing Lean is not about cost cutting. It should be about adding value and reducing waste. The results will be reduced cost. Focusing on cost reduction often causes managers to make decisions that drive value down and may even increase waste. I remember one company that decided to reduce cost by taking cell phones away from foremen and giving them pagers. Every time a foreman received a page, guess what happened? He had to walk some distance to find a phone to answer the page. When we looked at the time wasted to answer the page and calculated the cost of the foreman’s lost time, we found it more than justified the cell phones. Cost cutting is not necessarily waste cutting!

I would like to suggest the savings potential using Lean tools:

Applying the 5S’s can reduce treasure hunts and save time. It doesn’t seem unreasonable to save 5 minutes an hour per employee by better organization of material storage areas and gang boxes. That equates to about 8% savings in labor productivity, assuming the time is used to do value added work. The 5S’s will also add indirect savings in safety and ergonomics. I feel it is valid to suggest that 8 to 10% savings is possible using the 5S’s.

The big Lean saving opportunities in any construction project is in executing the work. That can be achieved through more effective work task planning. Research on actual projects applying the Last Planner System* has demonstrated savings from 15% to 30%. This happens as work is made ready and reliable.

Value stream mapping, quick change/set up and Kaizen events focus on specific processes or work functions. The saving generated varies from 2% to as much as 50%. The overall savings realized depends on the impact of the specific process to the core work of the company. This doesn’t always save big bucks! At a major aircraft manufacturing facility a Lean team developed a way to quickly change over the fabrication process for a special part and reduced the time for set-up by almost 90%. This would be great savings except that the plant rarely ever fabricated that particular part. Thus, the impact was minimum. Proper selection of processes to improve is key to generating real benefit to a company.

The preceding comments are my thoughts about Lean savings, I would love to hear actual examples from you who are implementing Lean. Please share them with me and allow me to share them with everyone else. We learn much from each other.

* Last Planner System (LPS) is a trademark of the Lean Construction Institute.

Lean should not be Mean

James Womack recent discussed the challenge to Lean implementation during the current economic downturn. Some of his thoughts are worth considering as it relates to contractors are:

“What we can do is to prevent the lean movement from being damaged by this recession. It is predictable that as the economy slides and companies get into deeper trouble, company executives and "lean" consultants will soon emerge with plans to get "lean and mean". Headcounts will be rapidly reduced as sales fall with the claim that value streams are being re-engineered to require less human effort. But what will actually be happening in most cases is that companies will simply be creating less value with proportionally fewer people. Then, when the recession is over and orders surge, they will rehire employees to behave just as they did previously. (Or they will convert former employees to contractors, with lower wages and fewer benefits.) There is nothing lean about any of this.

“What we have always tried to do in the lean movement is to create more value for society while protecting the employees creating the value from short-term variations in demand. Unfortunately, in the present circumstance a few organizations will need to reduce their number of employees significantly simply to survive. And "some jobs" is always a better outcome than "no jobs". But their managers should call this what it is: a reduction in employment that permits them to do less with less. That is, less value creation with proportionally fewer employees in a slumping market. They should never call it "lean" because it isn't.

“Most organizations will face a different choice in this recession. They can either treat their employees as an expense to be pruned quickly to protect earnings in the short term. Or they can treat their employees as an asset to be protected for their ability to create value in the long term. And lean managers will do the latter. They will view their employees -- with their accumulated knowledge of how to solve problems in order to continually reduce muda, mura, and muri -- as their organization's core advantage for success in the future even if there is cost to the organization in the short term.

“I wish I could count on all managers to behave like lean managers. But I can't. Over the past twenty years many of us have worked very hard to introduce a new way of thinking about value creation and how to treat fairly the people creating the value. It would be a tragedy if the big mura of this moment discredits lean ideas and alienates employees from a way of thinking that can create a win-win-win for companies, employees, and customers in the long term.

“I am therefore hoping that members of the lean community will speak out loudly whenever they see activities being labeled as lean that are only mean. And I would love to hear about positive examples of organizations with lean management that are taking the long view by finding ways to protect employees in the current downturn while laying the ground work for success in the next upturn. Indeed, these stories would make an excellent subject for a future e-letter.”

Source: James Womack, April, 2008 newsletter

Learning Opportunities

You may be interested in attending one of these training seminars:

May 6, 2008 – 5S’s in Construction – ASQ National Conference, Houston, TX
May 15, 2008 – Problem Solving Lite: Root Cause Analysis - Phoenix, AZ – Sponsor: PIPE & 469 JAC, contact Cathy
May 21, 2008 - Lean Works in Construction, Portland, OR – Sponsor: Columbia SMACNA Chapter – contact Tom Goodhue at 503.220.2303. Must be a SMACNA member to attend.
June 2, 2008 – Lean Works in Construction, Oakland, CA – Sponsor: Bay Area SMACNA Chapter – contact Audrey Kerns at (510) 635-8212. Must be a SMACNA member to attend.
June 18, 2008 – Gaining Customer Loyalty by Design, Kansas City, MO – Sponsor: SMACNA- KC – Contact Sang 816-421-3360 ext. 112. Must be a SMACNA member to attend.
Nov 10, 2008 - Gaining Customer Loyalty by Design, Oakland, CA – Sponsor: Bay Area SMACNA Chapter – contact Audrey Kerns at (510) 635-8212. Must be a SMACNA member to attend.

Other Lean Learning Opportunities:
May 7, LCI- Northern California - Lean Coordinators Meeting, UC Berkeley, CA
May 6-7 - TWI Summit, Orlando, FL
June 12-13 - LCI Design Forum: St. Louis, MO
July 17–18 - Lean and Green Summit, Boulder CO
October 28-31 - 10th Annual Lean Construction Congress, Boulder Colorado Sponsor: Lean Construction Institute

A Quick Thought

Most managers think that their greatest contribution to the business is doing workarounds on broken processes rather than doing the hard work to get the process right so it never breaks down so you don't need to do workarounds.
-Jim Womack

For more information about Lean applications to construction and especially the 5S’s contact Dennis Sowards at his office at 480-835-1185 or his cell at 602-740-7271 or at his web site: www.YourQSS.com