Lean & 5S's Newsletter #25 Aug 2007

Hold a Weekly Board Meeting

Part of visual control is keeping workers informed on the work progress. One company calls it a Board Meeting. Each week they review the key job metrics, status on improvement initiatives and other relevant job information in their meeting. The measures are posted on the bulletin board! You can do the same. This could be held separately from the weekly safety meeting or as part of it. For a project, key metrics could include PPC, weld errors, absenteeism, near miss reports, and % job completed. You could review next week’s schedule. It should be a crisp short meeting lasting about 10 to 15 minutes. End by asking for one good idea for improvement from each attendee. Invite your workers to attend your ‘board meeting’ and engage them in improving the company.

Muda Walk for a Month

If you are interested in driving out waste (Muda) sign up now for the Muda Walk for a Month.
Starting in September each workday I will email you a Muda Walk theme for you to apply while doing your Muda walk. You will look for opportunities to drive out waste related to that theme. I ask that you do a Muda walk in some part of your operations (jobs site, office, fabrication shop, materials warehouse, etc.) for one hour every workday for a month. The goal is to implement at least one improvement each day. More is better. You invest about an hour a day to do what managers should do every day – drive continuous improvement and document your successes. The emails assignments are free. The time is yours to invest. To participate in this pilot Muda Walk for a Month Opportunity - sign up by emailing your name to dennis@YourQSS.com

World-class Suggestion Systems

How does one make many improvements using Lean Thinking? It isn’t in the power of one but the power of many. Successful Lean implementation depends on the collective thinking of all employees. At Toyota’s Material Handling division in the USA, their goal is three ideas per employee per month. That’s 36 ideas per employee per year! (World-class suggestion systems average around 20 ideas per employee per year.) When I worked for J B Rodgers Mechanical we thought we were doing good when we reached an average of one idea per employee per year. Toyota team leaders are instructed to immediately implement any idea that won’t adversely impact quality. Their goal is to implement all improvement ideas within 20 days. They are currently at 90% within 20 days. They don’t spend a lot of money on rewards; quarterly they draw a name from a pool of employees’ names that submitted ideas that quarter. The prize may be a DVD player or similar prize. They do recognize the employees who reach or exceed the three per month goal. Dr. Basu, the president of this Toyota division, said, “the main requirement for a successful suggestion system is that employees are confident that they will not be laid off due to an improvement idea. (1)” This program is working for them and can work for you! Did I mention that this is in Toyota’s US plant?

To have an effective employee suggestion program one needs goals and measures and a culture of continuous improvement. It does not need to have big awards or dollars given out for ideas. It does require that supervision promote employees sharing ideas. I have seen, more often than not, the biggest barrier to employee involvement programs is front line supervision. They sometimes openly discourage new ideas. If you are thinking about implementing an employee suggestion system you will need to first develop the support of front line supervision.

In every company, managers should be identifying wastes and be a catalyst to help people break through their resistance to change and eliminate wastes.

“Stop being an ‘obstacle’ to change. As Dr. Shingo would always say ‘Do it!’ You get a good idea, think it through, discuss it with others and then find a way to ‘DO IT!’ - it is easy to find ways not to do it. Sure, doing it might cause mistakes but that is one of the only ways we learn.” (2)

(1) “Toyota's System of Success” Dr. Shankar Basu, president and CEO of Toyota Material Handling, USA, 2007 IndustryWeek Pest Plants Conference.
(2) Norman Bodek, NWLEAN: Digest 1728

Savings from improvement initiatives

In a best practices survey by IndustryWeek, they found that world-class companies generate savings from their improvement initiatives equal to 6.3% of their direct cost. What would this savings mean to your company? Would a 6.3% net savings be worth going after? How many more jobs do you have to sell to generate that percent savings? What improvement initiatives are you working on this year?

Source: IndustryWeek Continuous Improvement Newsletter 07/17/07

Standard Systems to the Rescue

George Hedley, a general contractor and construction business spokesperson, claims that the key to successful jobs is using good standard systems in the field.

“When is the last time you had a job go according to your plan? Do your field crews perform their work exactly the way you want it done? Do key people make good decisions without asking you first? Do your superintendents meet their schedules and commitments? Do your foremen take responsibility and accountability for quality, safety, and customer satisfaction? Do all of your crews follow your instructions and do things the same way? Do some field teams have less problems, punch-list items, and mistakes than others?

The construction business is not easy to organize. There aren't assembly lines where work processes and procedures are controlled. Every job is custom built with differing circumstances, conditions, plans, specifications, supervision, job problems, conflicts, and issues. So to overcome this reality, what is the best way you minimize field problems and maximize profitability on projects?

Good people or good systems? As a general contractor and developer of business parks, I make it a priority to visit our jobsites on a regular basis. Before we had an organized and systemized field operational system in place, almost every time I went to the jobsite, lots of things were going wrong and I would find many things I didn't like. We were overly reliant on good field superintendents and experienced foreman to ensure our project's success. Some team leaders and crew members did things their own way while others asked me how I wanted it done. This reliance on good people instead of good company procedures and systems caused lots of field problems and lost profits. As I didn't have enough time to inspect everyone's finished work product before we turned it over to our customers, lots of call-backs, long punch-lists, and ongoing maintenance became normal.

No field systems = no controls!

Our overall company goal is to make every project a success for us and our customers. We pride ourselves on quality workmanship and on-time completion at the right price by providing full value and full service. This was difficult to deliver without good systems in place unless I was everywhere making sure things were done correctly. This got out of control as our company grew from five crews to over 25 projects under construction at a time.

Think of the worst project you've ever worked on. What went wrong? Maybe you've had some of these problems occur on a project of yours:

• Roof, window, door, or deck leaks
• Field conflicts during installation
• Door hardware missing
• Late selection of finish materials
• Subcontractors not on jobsite
• Wrong material installed
• Missed or failed inspection
• Run out of material for crew
• Underground in wrong place
• Anchor bolts poured wrong
• Wrong corner bead installed
• Work not ready for next trade
• Installation quality unacceptable
• Unsafe working conditions
• No regular jobsite cleanup
• Damaged finished product
• No signed change orders
• Timecards late and not accurate
• Field paperwork not turned in
• Employees not following orders
• Late or missed schedule

These problems can be solved by making it an overall company priority to get everyone on the same page and do things the same way. The real problem is a lack of written company field operational systems. For example, if the quality of installation varies from crew to crew and foreman to foreman, the real problem is a lack of standardized systems on how you want it done company wide. You let your people do their best, but don't have a process in place to show them what you want, train them to do it properly, follow-up, and make people accountable. When you don't have company standards and systems that are clear and written, you rely on each person to try and do it the way they think is best. This doesn't ensure consistent performance and results.

Do it different or do it right! It's hard to make people responsible when they don't have a clear picture of what you want. What systems do you have in place to ensure everyone does things per company guidelines and standards? If you rely on word of mouth or your constant inspection, you'll never build an excellent company. Great people who don't follow the company standards create problems and chaos. How would you like to get your bank statement sent out differently every month, or your favorite restaurant make your favorite meal too spicy or too bland or too salty depending who was the chef?

Create a "Do" manual!
The hardest part about creating field operational systems is determining where to start. First, keep the big picture in mind. Your ultimate goal is to get everyone in your company doing business the same way. Eventually you want to have a company "Do" manual which clearly shows how you want your field crews to do the required work. Each field operational system must be drafted and formalized on an 8 1⁄2" x 11" piece of paper inserted into three-ring binders distributed to your crews. Everyone will receive and follow this company "Do" manual outlining your field operational systems. This acts as your ongoing training manual to be used in your training program and referred to prior to working on a particular stage of projects under construction.

As you visit jobsites, start identifying things that go wrong on a "Fix-It" list you carry around with you. Also put things on the list you know that are key to the success of your projects. As a general contractor, I know that when my field superintendent checks the anchor bolt locations and dimensions prior to every concrete pour, bolts won't be installed in the wrong place. We don't want to leave this to chance, as bolts poured incorrectly are expensive to fix and will slow the job down for weeks.

Another example of a system required to guarantee company success is accurate and timely timecards. Without a timecard system, some of your foremen will do a good job while others are always late and inaccurate. Filling timecards out on Friday afternoon while driving home won't give you accurate man-hours per cost code. This will lead to bad job cost reporting and an inaccurate cost history to calculate your next estimate or bid. An accurate timecard system must be in place to ensure long term profitability in my company. How about yours? Should this problem be on your "Fix-It" list?

What do you need to fix?
Identify things you know will ensure every project will be a success. Create a "Fix-It" list and divide the items into these categories:

• Field systems
• Project management systems
• Financial systems
• Estimating systems
• People systems
• Leadership systems
• Equity & wealth systems

In every category prioritize what problem areas cost you the most money, grief, and time to fix. For most companies, 20 operational systems in each category will solve eighty to ninety percent of the recurring problems you experience in a growing company. Assign teams based on who works in what area and let them draft solutions and systems that will work companywide.

To get started, ask everyone in your company to start a "Fix-It" list. Get them to identify what systems, guidelines, and procedures will ensure their projects will be successful and meet the overall goals and objectives. Look for systems that produce the same results every time, guarantee on-time schedules, deliver quality workmanship, improve productivity, and enhance profitability. These written and formalized systems will become your playbook. Change your role from inspector to head coach. Your players will then know the plays and roles to make things happen in a consistent manner. …

Often crews get in the habit of doing things the same way on every job. But many times, the job specifications change. Create a checklist for every major field installation you perform. Have your foreman fill it out and submit it to the office with his paperwork and insist he checks off every item on the list.

Good field systems also include pictures or sketches of the work required - such as a properly formed slab, an expansion joint installation, or a thickened edge detail of your company standards.

Without systems in place, you are at the mercy of your people, subcontractors, and suppliers to do a good job. Systems allow you to reduce field problems and get your jobs built right the first time. Remember the old saying: 'Measure twice, cut once’? This is an example of a simple system and proven standard that works. The reason your projects don't finish on-time is because you haven't made scheduling, meeting, and communication standards a priority in your company. To build an excellent construction company, make it your priority to create, draft, and implement field operational systems to minimize problems and maximize profits!”

Source: Entrepreneurial Excellence 'Construction Business Best Practices' Series by George Hedley, Hardhat Hedlines, June 2007

Learning Opportunities

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

• Sept. 27, 2007 – Lean is Not a Fad Diet – it works in construction too! – Phoenix, AZ – Sponsor: PIPE & 469 JAC, contact Cathy at pipetrust@qwest.net
• Oct. 22, 2007 – Lean Works in Construction – an update of recent research - Las Vegas, NV SMACNA National Convention,
• Oct. 25, 2007 – Performance Measurement - How to Use Measures to Manage and Improve Performance - Phoenix, AZ – Sponsor: PIPE & 469 JAC, contact Cathy at pipetrust@qwest.net

Other Lean Events:

• Sept 27–28 - Introduction to Lean Construction - Seattle – Sponsor: Lean Construction Institute. Visit them for registration and details.
• Sept 27-28 – Lean Accounting Summit – Walt Disney World, Orlando, FL.

A Quick Thought

We are a great people to get tired if anything awful quick. We just jump from one extreme to another.
- Will Rogers

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