This issue from PRINTING United Alliance features articles on why the ability to capture employee ideas is crucial to company success, how to train yourself to see waste, and the necessary ingredients for an improvement culture. CI Ready!, a virtual event this April, is also discussed. The practice of continuous improvement offers printing and graphic communications companies a way to create a sustainable competitive advantage.
Articles in this issue:
- Front-line Driven Improvement: The Key to High Performance
- Developing Kaizen Eyes
- Creating the Improvement Culture
- CI Ready! Virtual Event Slated for April
Front-line Driven Improvement: The Key to High Performance
Alan G. Robinson
The Clarion Hotel Stockholm has one of the best front-line idea systems in Sweden and has twice won a national award for it. Its billionaire owner, Petter Stordalen, is often named as the richest person in Scandinavia. Why is someone so wealthy and powerful so careful to ensure that in all his hotels, managers pay close attention to the ideas of their front-line workers? Because that, truly, is the key to high performance.
To explain why, let us look at a typical idea. This one came up in the hotel’s downstairs bar, one of the busier bars in the city. Every hour or so, a bin of empty recyclables (cans, bottles, and Tetra Paks) would build up behind the counter. A bartender would then have to carry the bin downstairs to the basement and sort the containers into three different dumpsters. One day, Marco, one of the bartenders, was down in the basement doing this job, when he realized that he was right underneath the bar. In the bartenders’ next idea meeting, he proposed an improvement: Why not have maintenance drill three holes in the floor behind the bar and install pipes, so the bartenders could simply drop the empties directly into the correct dumpsters?
The team liked the idea, and it was quickly implemented. If you do the arithmetic, the improvement saved a surprising amount of time: seven minutes an hour, 16 hours a day, or just under two hours per day. And since the bar was open 365 days a year, the idea saved 681 hours, or 17 days of work annually. What is more, the bartenders told me, the bar was always busy and when one of the three bartenders on duty had to leave to do the recycling, you could actually watch sales go down.
Many leaders and managers are unaware of the 80/20 Principle of Improvement, which states that some eighty percent of any organization’s improvement potential lies in front-line ideas. (The other twenty percent lies with ideas from managers and consultants, new technology, etc.) It is a remarkable fact to contemplate, given that most organizations do far better at suppressing front-line ideas than promoting them.
If front-line ideas constitute eighty percent of an organization’s improvement potential, then they are the key to high performance. How can the leaders of an organization even think about operational excellence, when they are using only twenty percent, or one fifth of its improvement engine?
Many reasons underlie the 80/20 Principle. In this brief article, we will look at just three of them. First, every day front-line employees see many problems and opportunities that their managers do not. Most problems are buried deeply in their organization’s processes, which puts the front-line staff who work directly with these processes in the best positions to see and solve them. As a result, they have plenty of ideas to improve productivity and customer service, to offer new or better products or services, or to enhance their organizations in other ways. Marco was the one to see the opportunity to improve the recycling process because he was the one doing the recycling.
The second reason behind the 80/20 Principle is the unusual nature of front-line ideas. Not surprisingly, they focus on improving the day-to-day value-delivery processes, because these are typically what front-line workers work with. So, ideas like Marco’s are used not just once, but repeatedly, sometimes tens of thousands of times. Thus, an idea that seems small—because we visualize only a single instance of it—can have an enormous impact. One large hospital chain I worked with got a simple improvement idea from a nurse that saved 30 seconds per instance it applied to. But it applied to tens of thousands of people across the entire organization, multiple times per day. The CI department calculated that it saved some $3 million per year in lost time, and it won the organization’s award for best idea that year.
The third reason for the power in front-line ideas is the sheer quantity of ideas that front-line people can have, given some brief training, encouragement from management, and when enabled by a modern idea process. We have come a long way since the suggestion system, which is quite literally a medieval technique. Today’s best idea processes routinely implement twenty, fifty, or even a hundred ideas per employee per year. The last time I visited the Clarion Stockholm, it was averaging 67 implemented ideas per employee, or almost 70,000 improvements per year. These improvements accumulate into an enormous proprietary competitive advantage—proprietary because the changes are individually so small that competitors don’t see them, and so can’t copy or counter them. How would a visitor from a competitor bar know that the Clarion had installed three pipes behind the bar or about most of the other 70,000 improvements the hotel makes each year?
The bottom line is that idea-driven organizations have five to ten times the improvement and innovation capability of more traditional top-down organizations.
For leaders to be able to truly tap front-line ideas, there is a lot to know, much of which is counterintuitive. But if you do choose to learn how to do it, the ability to get large numbers of ideas from your front-line people will be a complete game-changer—for them, for you personally, and for your organization.
Alan G. Robinson specializes in Lean, managing continuous improvement, creativity, ideas and innovation, and is the co-author of ten books—the latest being The Idea-Driven Organization—which have been translated into twenty-five languages. He is currently a professor at the Isenberg School of Management at the University of Massachusetts. Robinson will be sharing more on the above topic during PRINTING United Alliances’ CI Ready! virtual event, April 19-22. alanrobinson.com
Developing Kaizen Eyes
One of my favorite quotes is from Shigeo Shingo, who said: “We must always keep in mind that the greatest waste is the waste we don’t see.” Suppose you were asked to find someone in New York City’s Grand Central Station on a Monday morning, but you knew nothing about the person you were asked to find. How successful would you be? Not knowing who or what to look for makes it unlikely you would succeed at the task.
The core idea of Lean manufacturing is to maximize customer value while minimizing waste. Before we can minimize the waste in our businesses, we must know what to look for and how to look for it. For this we need to develop what I like to call “kaizen eyes.”
Kaizen Eyes: the ability to see the eight wastes of Lean manufacturing in any setting and to see ways of eliminating them.
To develop kaizen eyes, we must learn the eight wastes, which are:
DEFECTS: Any process, product, or service that fails to conform to customer requirements is waste. Examples are scrap, rework, white waste, printed waste, returns, reruns, and replacements.
OVERPRODUCTION: Producing sooner, faster, or in greater quantities than internal or external customers demand results in overproduction, which can also be defined as any production in excess of “make one, move one.” It leads to many other wastes such as inventory, transport, motion, and waiting.
WAITING: It’s wasteful to have people, parts, and/or processes standing idle waiting for something to occur before they can proceed. Unbalanced steps in the value stream cause waiting and work-in-process inventory. Approvals, handoffs, transportation, and inspection also cause waiting.
NON-UTILIZATION OF TALENT: Failure to tap the skills, knowledge, and brainpower of employees in running the business, solving problems, and improving processes is an often overlooked waste.
TRANSPORT: Any movement of product or materials from one place to another is a non-value-added activity and therefore waste. The more you move things, the more opportunity there is for damage or injury.
INVENTORY: Raw materials, work in process, and finished goods that are not having value added to them should be reduced or eliminated. This waste occurs due to stops in the production flow and poor alignment with the pull of internal and external customers. The waste of inventory is directly related to overproduction and waiting.
MOTION: This relates to the unnecessary movement of people. Any movement of a person’s body that does not add value to the process is waste. Examples include walking, bending, lifting, twisting, and reaching.
EXTRA PROCESSING: Spending more time and effort than needed or producing higher quality than required by the customer is waste. Producing product to tighter specifications than necessary adds cost and time. Unnecessary approvals and inspections to ensure quality are common examples.
Once you feel you understand these wastes, it’s time to practice seeing them. The best way I know to do this is to use the approach developed by Taichi Ohno called “Stand in the Circle.” Ohno’s purpose was to develop the ability to see and understand waste. The steps are simple: Select a spot in the work area of interest. Draw a circle three feet in diameter on the floor where it would be safe for a person to stand. Stand in the circle and observe the on-going work activities for at least 30 minutes. During that time identify ten waste-generating conditions. Write a description of each opportunity on the form provided below and check off the type of waste or issue you see. Non-utilization of talent is not included on the sheet as it’s nearly impossible to find just through observation. This activity is not about the circle, it’s about the process and the thinking that occurs. It’s meant to build awareness and to rewire your brain to see many small problems.
Just about any area you choose to observe will exhibit several of the eight wastes. Numerous studies I’ve performed at printing companies over the past several years reveal that during the time between order entry and product shipment, value is being added about 20% of the time. The remaining 80% of the time actions are occurring that add no value from the customer’s perspective. In other words, it’s waste!
In the past, you likely walked right past these problems, not realizing it is waste that creates an impediment to your success. The challenge is to look through the “clutter” and to see the actual problem. You need to understand the reality of the situation before taking action. As your ability to see waste and problems improves, train others to do the same.
Once you begin to have eyes trained for waste, you will see it everywhere: at home, in stores, airports, and restaurants. Anywhere you go you’ll see one or more of the eight wastes. And when you begin thinking about how the wastes you see could be reduced or eliminated, you are on the road to improvement (kaizen).
The more kaizen eyes you have in your company, the greater the opportunity to find and reduce the wastes that are adding time and cost to your operations. To paraphrase Shigeo Shingo, if you don’t know what to look for, you’ll never find it!
John Compton is a former quality executive in the printing industry, professor emeritus at Rochester Institute of Technology, and the conference consultant for PRINTING United Alliance’s annual Continuous Improvement Conference. He is available through the Alliance to assist companies with CI and Lean initiatives.
Creating the Improvement Culture
Organizations don’t naturally turn towards continuous improvement. It takes focused, concerted effort to create this kind of behavior and culture. Following are nine points to consider:
1. State your commitment to continuous improvement and explain why. Most organizations face a flavor-of-the-month problem with new initiatives because often the underlying rationale isn’t articulated. HR initiatives, in particular, tend to receive this sort of cynicism, and you can understand why. Most people don’t see how self-identifying as a Myers-Briggs ENTJ is going to affect new product development—or their bonus at the end of the year. Fit leaders live the gospel of continuous improvement and continually show how it directly affects the organization by connecting it to larger goals and strategy.
2. Participate, don’t proclaim. Nothing is more toxic to the establishment of a continuous improvement culture than hypocrisy. A fit leader participates in improvement activities herself. It doesn’t matter whether she is leading them or involved peripherally—the key is regular participation. People need to see that you value improvement enough to invest your own time in the same activities you’re asking them to commit to.
3. Challenge people to improve. Then, challenge them again! Organizational inertia is a formidable opponent. You’re not going to overcome it by asking people to do one project—or two, or even five. People are busy with their daily responsibilities. As a leader, you need to continually challenge them to find improvements. This kind of ongoing pursuit can be emotionally difficult, because people may feel that they can never satisfy you. But challenging people is actually a sign of respect for their existing skills and their capacity for growth and learning.
4. Give people time to improve. Make no mistake about it, committing to improvement means regularly devoting time and attention to it. Google and 3M have garnered much press for their 20-percent-time rule—free time for people to work on new products and projects. I would argue that if creating something new is worth 20 percent of peoples’ time, surely improving every facet of the way your company operates is worth at least six percent (i.e., 30 minutes a day). At Bloomington, Minnesota-based Quality Bike Parts, managers are held accountable for giving employees the time to implement their improvement ideas, which may involve redistributing work, bringing in temp labor, and shifting schedules.
5. Make ideas visible and respond to them quickly. A Google search for “suggestion box” leads to page after page of boxes with padlocks. I’m not sure where the notion came from that employee suggestions—like dangerous animals—should be kept under lock and key. Instead, post improvement ideas in public, where everyone can see them—and always respond to them within a few days. Quality Bike Parts has a policy that managers must respond to ideas within 48 hours, and those that are selected must be implemented within three weeks. Fit companies know that if you don’t respond to all ideas, you increase the likelihood that people will see your actions as inauthentic.
6. Focus on increasing customer value, not on cost savings. Cutting expenses is not inspiring to anyone, and as a result, asking people to find cost savings is a guaranteed dead end. People are much more energized when they are able to make improvements that create value, provide better service, or make their colleagues’ lives (and their own) a little easier.
7. Expect (some) failure. If you’re consistently running experiments, you will inevitably fail some of the time. Don’t criticize people for not succeeding. The Silicon Valley mantra these days is “fail fast,” which provides license to experiment without fear of failure.
8. Listen carefully for complaints. Sometimes it’s hard for people to think about improvements they can make; however, by contrast, it’s usually pretty easy for them to find things to complain about. Fortunately, every complaint is a nascent improvement opportunity: seize upon them, and challenge people to solve them.
9. Drive out fear. Your team won’t embrace improvement if people are afraid that their ideas will be dismissed, or if they’re afraid it will cost them (or their co-workers) a job. You must make it absolutely clear that no one will lose his or her job as a result of any improvement. Even if a particular role becomes unnecessary, that person will still have a home somewhere in the organization.
Daniel Markovitz is an award-winning author of several books—The Conclusion Trap, Building the Fit Organization, and A Factory of One. He’ll be presenting a session during PRINTING United Alliances’ CI Ready! virtual event, April 19-22. Markovitz is a faculty member at the Lean Enterprise Institute and a lecturer at The Ohio State University’s Fisher College of Business. He consults, trains, and speaks on Lean topics. www.markovitzconsulting.com.
CI Ready! Virtual Event Slated for April
PRINTING United Alliance will be offering CI Ready! again this year. Taking place April 19–22, 2021, the virtual event features four hour-long sessions presented over four days that focus on foundational principles and tools for implementing a continuous improvement program. It is ideal for executives and managers who are exploring the value of a continuous improvement (CI) program, in the early stages of implementing one, or need a convenient way to educate employees in the principles and tools.
- The Bedrock Principles and Tools of Continuous Improvement
- Implementing 5S and Creating a Visual Workspace: A Case Study
- Capturing Workforce Knowledge and Creativity
- Making Better Decisions: Avoiding the Conclusion Trap and Other Pitfalls
Check back soon for registration information.
Continuous Improvement Newsletter is published quarterly by PRINTING United Alliance in support of its annual Continuous Improvement Conference (August 22–25, 2021, in Columbus, Ohio). Past issues are available at ci.printing.org/ci-newsletters. Send submissions and subscription requests to email@example.com.