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Oct 24, 2014

The Continuous Improvement Team's Role in Lean Implementation

How do Continuous Improvement teams fit in with your Lean initiatives? Improvement teams were introduced as quality circles more than twenty-five years ago. Over time they started to fall into disfavor as companies became doubtful about the amount of effort required coach cross-functional teams to success. Hard work or not, improvement teams are still one of the most powerful tools an organization can use to ensure that people stay firmly focused on meeting customer needs and business goals. Teams that bring employees together from various departments to solve problems and make improvements are one of the best ways to fight 'silo' mentality. Improved communication, mutual respect and shared responsibility for goal achievement are proven results from properly building and mentoring Continuous Improvement teams. Lean initiatives can and should piggyback on these Continuous Improvement teams and similarly, Continuous Improvement or Six Sigma teams should use their Lean Future State Implementation Plan to determine the projects they will work on. These Future State plans are developed for bottom line Value Stream improvement and are both a road map and baseline measure of return for Lean implementation. Many companies have found that these plans make an excellent 'to do' map for Continuous Improvement and Six Sigma work as well. When Continuous Improvement teams act in isolation from Lean initiatives, companies often find they are besieged by a series of 'point' improvements rather than thoroughly reasoned, systemic change. While point improvements can make one area better, and appear solid on paper, they frequently fail to have any sustainable impact on the organization's bottom line. Point improvements tend to pass waste and inefficiencies from one area to another without solving the root cause of the problem for the system as a whole. We call the use of point improvements 'Exciting Chaos'. Everyone involved feels like they are contributing but the effect is isolated to one department, cell, or person without being directly connected to the entire 'system'. The results are minimal and much less than expected. When organizations complain about ineffective Continuous Improvement teams, it's usually because of this 'point' improvement focus. Instead, it is systemic work that makes sustainable end-to-end Lean improvements. The Lean test for correct systemic method is whether you get lasting positive and competitive customer impact as well as dramatic improvements to bottom line profitability. In one well-known business, the company invested a great deal of money in getting faster processing equipment. The result: work was passed on to the next processing step 30% faster, however the work sat idle 30% longer in front of that next step. If the company had done a proper Value Stream Map analysis, they would have discovered there were other areas of opportunity to work on and that the correct sequence of improvement steps was critical. They would have had a system-focused Implementation Plan defining what needed to be done, when it needed to be done, and who needed to be involved. Their resources would have been utilized more effectively and the improvements would be measurable from end-to-end (bottom line and customer). Continuous Improvement teams generally work on problems that are highly visible and clearly need to be fixed. The right Lean questions for them to ask are: "Which problem comes first? Which problem will have the most systemic bottom line return for our efforts? Which problem will add the most value for the customer?" When we complete the Lean Future State of a Value Stream, we produce a properly designed Lean Implementation Plan. It has been prioritized to give the company maximum results. If the improvement teams aren't working on problems from that implementation plan then the Continuous Improvement approach must be changed. Tying improvement projects to the Lean Implementation Plan has additional benefits. People on the Improvement Teams will clearly understand the Lean business strategy and direction of the company. Rather than working on incremental problems, often at the cell or department level, they work from the Future State plan and gain broader, more company-wide support. Continuous Improvement teams are seen as playing an important role in transforming the company into a Lean Enterprise. This brings increased pride of accomplishment and sense of purpose to the team, which in turn, helps them produce sustainable changes. Everyone is now involved in Lean implementation and this keeps improvement energies moving forward without the need to push. This is the environment that is so characteristic of the best and most competitive organizations. In companies where the improvement teams are not part of the Value Stream improvement process, another serious problem occurs. There is usually a struggle and competition for resources and attention. Lack of resources is a major stumbling block for companies implementing Lean. By keeping Lean Future State Implementation and Continuous Improvement teams separate, companies lose the advantage of skilled resources pooled to quickly and efficiently achieve their Future State. Continuous Improvement teams have skills needed to solve problems properly and conduct meetings aimed at making improvements. If they operate outside of the Value Stream, they are probably going to make point improvements that will most likely lead to frustrating and weak return. The solution is to make your Continuous Improvement teams and Lean Future State Implementation teams one and the same. Train your Continuous Improvement people on Lean methods and coach them to think system-wide rather than incrementally for their Lean problem solving. Continuous Improvement teams should be an integral part of the Lean Value Stream initiatives. They will have to make some adjustments in the process, but the result will be changes that help the company systemically improve processes, maximize value to the customer, and dramatically improve the bottom line.