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May 2015 www.leanmj.com

LEARNING NEW TRICKS Assessing the role of lean in re-balancing the economy.

Organisations and interviews featured in this edition include: AMRC, EEF, Duggan Associates, Radiant Law, Tier Link Limited, Morrison Bowmore, TM Lean Conference, Evoke People Development.

IN THIS ISSUE: Lean apprenticeships A valuable asset to continuous improvement?

Distilling lean LMJ goes north of the border to explore how Glaswegian Morrison Bowmore Distillery is taking on lean.

Lean and law Exploring the values of contract process mapping as a way Issue 4 Volume 5 to run a more lean business. editor’s letter

Dear reader,

You may have noticed some changes occurring in the LMJ over the past couple of months: It’s all in our efforts to continuously improve. We thought the old look was getting a little outdated and distracting from the content. So we’ve lightened, brightened and streamlined things a little.

It’s all in an effort to make LMJ the best it can be. We hope you like the look as it continues to change, and be tweaked a little here and there.

In other news the Lean Management Journal Annual Conference is rapidly approaching. This year we’re heading off to Amsterdam to show some love to our lean readers on the European continent. The event will take place over July 8-9 and will showcase a variety of discussions, panel debates, ideas exchange cafes, networking opportunities and special presentations. And if you read last month’s magazine you’ll see we’re launching our debut Lean Top 25, which will be presented there. We hope you’ll be able to join us for that – and if you have anyone you think has done amazing work in lean, don’t forget that you can nominate them at Editorial Commissioning editor [email protected]. Andrew Putwain [email protected] Back to the magazine: this month we look at apprentices with a host Managing editor of interviews with several of those involved in the training of the next Victoria Fitzgerald generation’s future lean managers and implementers. [email protected] Editorial director Jon Radford, engineering trainer and skills assessor at the Advanced Callum Bentley [email protected] Manufacturing Research Centre talks to us about how much he believes Design lean teaches the students and how it’ll help them in their future careers. It Art editor seems to be the case with the students too, several of them also spoke to us, Martin Mitchell and give their ideas on the benefits they believe lean will teach them. [email protected] Designers Alex Cole We also speak to Ian King, from the EEF’s lean academy, designed to spread [email protected] the word of lean to companies not normally able to afford in-depth training schemes or consultants. The academy goes on the road to teach great ideas, In order to receive your but its base in Birmingham is also the home to many apprentices who are copy of the Lean Management Journal kindly email taught there. [email protected] or telephone 0207 401 6033. Neither the Lean Management Andrew Hemmings, of Tier Link Limited, presents his views on how to Journal nor Hennik Group can achieve lean in your supply chain. What’s necessary and what’s not - and accept responsibilty for omissions or errors. how to get the results quickly.

Terms and Conditions Please note that points of Radiant Law’s head of managed services Jason McQuillen returns to LMJ to view expressed in articles by teach us about effective ways to bringing process mapping to the world of contributing writers and in advertisements included in high volume commercial contracts. this journal do not necessarily represent those of the publishers. Whilst every effort is made to This month’s case study sees LMJ go north of the border to Glasgow and ensure the accuracy of the information contained in the visit whisky distillers Morrison Bowmore and see how this firm is taking journal, no legal responsibility will lean to its heart. be accepted by the publishers for loss arising from use of information published. All And Bill Bellows joins us with the third and final part of his encyclopaedic rights reserved. No part of this publication may be reproduced take on the brief history of quality in his latest Lessons from Deming. or stored in a retrieval system or transmitted in any form or by any means without prior written Aside from this we have our usual social media and events page to get consent of the publishers. you further involved with your lean cohorts. We hope you enjoy it and happy reading.

Andrew Putwain, Commissioning Editor.

2 contents MAY 2015 contents 04 Introducing the editors 25 Sector Focus Lean apprenticeships: A valuable asset to 06 Lean News continuous improvement? LMJ interviews Jon Radford from the Advanced 08 LMJ top 25 Manufacturing Research Centre and Ian King from Read all about LMJAC and the Lean Top 25. the EEF Lean Academy on the benefits of lean being taught to apprenticeships and their views 09 Introduction on encouraging young people to learn about Brenton Harder leads us in with this month’s continuous improvement. introduction on apprentices.

32 Lean online Principles & purpose We bring you all the latest lean news and 10 Optimising engineering changes discussion from the world of social media. Tim Healey from Duggan Associates, presents how to implement a lean value stream in the office, focusing on engineering change notifications (ECNs). Case Study 34 Morrison Bowmore: 14 Lean and law Distilling lean Radiant Law’s Jason McQuillen returns to LMJ goes north of the border to explore how LMJ with an article expounding the virtues Glaswegian Morrison Bowmore Distillery, learnt and values of contract process mapping as a how to make whisky with lean ideals. way to run a more lean business.

18 Partnership development: the 37 Special Feature route to lean supply chains, part one Conference review Andrew Hemmings, managing director of Reviewing the lean manufacturing conference Tier Link Limited, presents the first of a that provided plenty of food for thought two-parter on the path to the leanest supply on lean and how to keep staff engagement chain out there. levels up.

22 Apprenticeships: beyond the technical 40 Lessons Director of training provider Evoke People from Deming Development Joe Bell makes the case for A brief history of quality, part three immediate investment in apprentices, above Bill Bellows shares part three of Deming’s ideas and beyond the departmental rotation and on quality in his latest column. technical upskilling usually offered.

42 Events Find out about the latest lean events from all over the world.

Elizabeth House, Block 2, Part 5th Floor, 39 York Road, London, SE1 7NQ T +44 (0)207 401 6033 F 0844 854 1010 www.hennikgroup.com. Lean management journal: ISSN 2040-493X. Copyright © Hennik Group 2015. www.leanmj.com | May 2015 3 Introducing your Our experienced editorial board members contribute to the journal providing comment editors against articles and guiding the coverage of subject matter.

René Brenton Zoe Radnor Aagaard Harder Loughborough Telenor, Denmark Commonwealth University, United Bank of Australia, Kingdom Australia

RenÉ Paul Hardiman nick rich Aernoudts Industry Forum, Swansea Lean Management United Kingdom University, United Instituut, The Kingdom Netherlands

Jacob Austad Alice Lee Ebly Sanchez LeanTeam, Beth Israel Volvo Group, Denmark Deaconess Sweden Medical Center, USA

Bill Bellows Sarah Peter Walsh President, Lethbridge Lean Enterprise, In2:InThinking Cardiff Business Australia Network School, United Kingdom

David Jeffrey K. Liker Peter Watkins Ben-Tovim University of GKN, United Flinders Medical Michigan, USA Kingdom Centre, Australia

John Bicheno Torbjørn wendy wilson University of Netland Warwick Buckingham, Norwegian Manufacturing United Kingdom University of Science Group, University and Technology of Warwick, (NTNU), Norway United Kingdom

Gwendolyn joseph paris Steve Galsworth Operational Yorkstone Visual Thinking Excellence Society Edinburgh Napier Inc., USA University, United Kingdom

More information on our editorial board, their experience, and 4 views on lean is available on the LMJ website: www.leanmj.com | www.Leanmj.com

SAVE THE DATE!

6th Annual LMJ European Conference 8/9 JULY 2015 AMSTERDAM

| www.leanmj.com | April 2014 Issue 3 Volume 5

RIse ofnes the mAchI considering the role of technology in lean.

Organisations and interviews featured in this edition include: Hewlett-Packard, Poppendieck, Edinburgh Napier University, Lean IT Strategies, Infor, Mark Graban, Bill Bellows, Jelena Pantic.

IN THIS ISSUE: Can we transform IT through lean management? Christian Verstraete, chief technologist for Hewlett- Packard, explores how the amalgamation of varying

$65 – £45 – €50 technology is changing business interactions and how lean can improve the management of IT operations and development. Writer, lecturer and The scaling dilemma: lean developmentPoppendieck, expert, Mary examines ways of sustaining efficiency within a growing organisation. Edinburgh High tech-leanissue 4 tech: volume 4 | may/june 2014 Napier University’s Steve Yorkstone analyses the appeal | www.leanmj.com of technology, its potential to limit improvement and how

$65 – £45 €50 good technology has enabled visionary change. Lean and information technology-finding the right Lean expert, Steve Bell, weighs in on how to balance: foster a harmonious relationshiple betweena IT andn lean. Issue 6 Volume 4 | August 2014 | www.leanmj.com goes PuBl reflecting on thei applicationc of lean in the public sector.

organisations and interviews featured in this edition include: eatonH ydraulics, the uk ministry of justice, solihull council, uk Police force, the British library, torbjørn netland, john Bicheno, debbie simpson and joseph Paris. H. in tHis issue: from capability to practice: at the uk ministry of justice,Head of Business change continuous improvement in the public sector and how a rhian H balanced contribution of capability,amer, meaningful examines practice Register your interest now: and evidence is the key to transforming it. going lean the solihull way: Exploring a scientific approach pay off a budget deficit, manyas the councils public aresector taking tries matters to in their own hands by cutting waste and making sensible to lean management savings using lean practices. kim silcock, head of lean transformation at solihull metropolitan discusses. Organisations and interviews featured in this lean enforcement: edition include: nottingham Business Harry school Barton, shares professor his findings at from Synlait Farms, PO Construction, Bill Bellows, Michael his 2013 study of implementing lean in five police Ballé, Jon Miller, Jeffery Liker, Mike Rother. forces across the uk, highlighting lean as a mechanism to reinstate trust and confidence in policing, while IN THIS ISSUE: enhancing police employee engagement. T: +44 (0)20 7401 6033 (Opt 3) Science of lean: Jeffery Liker, professor at the the leaning library: University of Michigan, and leadership speaker, Mike expectations are compelling Budget cuts the and public increased sector customer to deploy Rother, explore whether treating lean as a practical lean nationwide. science could improve results. services at the BritishHead library,of document delivery and customer part of the 42-year-old institution’s lean journey. andy a Lean as folk medicine: Jon Miller, partner at the ppleyard, documents Kaizen Institute and founder of the Gemba Academy, analyses the parallels between traditional medicine E: [email protected] and lean theories. Leannovation: Chairman of the Lean Academy, Dan Jones, discusses plan-do-check-act and the importance of blending action and theory.

What makes lean a science: Author Michael Ballé shares his ideas on how lean’s emphasis on individual learning makes lean theory a unique scientific process.

Follow us at @LeanMJournal #LMJAC

For all the latest news and to subscribe visit Leanmj.com

LMJAC 2015 Advert for the TM.indd 1 27/03/2015 11:06 LMJ

The training course shows productivity can be improved. “We attach high importance to practical examples at our model warehouse,” Christoph Kunert, a trainer, reports. “About 180 products are stored at the model warehouse and are to be taken from the shelves and compiled in client packages by the participants using packing lists. After every training round, the proceeding and success are analysed and the processes are evaluated. Every workings step is checked for its function in creating values added and adapted accordingly,” Kunert explains. Transports, stocks, waiting times, and handling times are reduced to optimum values.

Germany: lean warehouse The theoretical part of the training was developed KIT in co- training course opens operation with the McKinsey consulting company and methods of lean management are transferred to warehousing. Knut A training course at Karlsruhe Institute of Technology (KIT), in Alicke, head of the European practice conjunction with McKinsey consulting company, teaches analysis of McKinsey says: “Transfer of lean management concepts to and lean improvement processes of warehouses. warehousing is associated with an average cost reduction potential of 20%. The learning-by-doing approach of the model warehouse “Warehousing often is neglected by the company management,” supports companies in sustainably developing the capacity to use says Katharina Dörr, trainer at the KIT model warehouse. “While these potentials.” production, marketing or sales are optimised, warehousing is often considered an annoying accessory of the core business, where The training also addresses leadership issues and personnel efficiency cannot be enhanced anyway.” management at a lean enterprise.

USA: Food giants go ‘zero-based budgeting’

Brazilian private equity firm 3G, which Other food and beverage companies as a business tool by a former Texas owns Heinz and Kraft, now merged, are embracing 3G’s financial tool, in Instruments Inc. manager. The effects of plans to introduce a new business fear they, too, could become targets of this change are improved shareholder management style. activist investors or stronger rivals. Big returns and dividends. But on the flip packaged-food companies have been side, it has made the work for employees At Kraft, as it has elsewhere, 3G plans particularly appealing targets for zero- more rigorous and, some would argue, to implement zero-based budgeting, an based budgeting. more ruthless. austerity measure requiring managers to justify spending plans from scratch “Every board needs to be on notice that At Heinz, 3G made rapid changes: every year. The technique has triggered they have to take very similar lessons, Redundancies at its Pittsburgh sweeping cost cuts at 3G-related from 3G’s cost-cutting or risk being headquarters, slashing Heinz’s overall companies including Heinz; from outmanoeuvred by leaner rivals”, said head count by about 1,480, or 4% of eliminating hundreds of management Bruce Cohen, analyst with consulting firm the world-wide workforce and shutting jobs, banning corporate jets and requiring Kurt Salmon. several factories. employees to get permission to make colour photocopies. Zero-based budgeting requires managers Zero-based budgeting can go deeper to plan each year’s budget as if no money than lean but shares many similarities. Investors have grown increasingly existed the previous year, rather than Long term success of 3G’s tactics has aggressive about second-guessing using the typical method of adjusting yet to be proven. The approach risks management’s operations and use of prior-year spending. Forcing them to souring morale and some companies capital. Several activist investors have justify the costs and benefits every 12 have tweaked the terminology because of praised the firm’s cost-cutting methods. months. The system was pioneered negative perceptions.

6 Photo courtesy of Erik Söderström via Flickr Canada: lean taught to India: Europe experts teach lean public sector to SMEs

Alpen Path Solutions Inc. has developed a series of lean for Experts from Europe are on a mission to introduce green government training workshops specifically tailored to help public and lean initiatives in Indian SMEs. As part of a project sector employees continuously improve the delivery of services funded by Kolkata’s Jadavpur University and the UK’s Aston faster, better and cheaper. University, experts are sharing best practices in the supply and value chain. Governments around the world have been struggling to find ways of delivering quality services to citizens in spite of budget “The idea is to improve SMEs performance by restrictions. Many governments have turned to lean management implementing a green supply chain management model as a proven approach to continuously improve services by which is based on sustainability. This will reduce wastes and focusing on what has value for citizens while reducing cost and costs, improve performance with minimal or no damage to bureaucracy. In support of government organisations engaged the environment. on their lean journey, Alpen Path Solutions Inc. has launched a training series designed for public sector employees: Lean for “We are not imparting some ground-breaking technology but Government Training Workshops. just sharing ideas on how to do it,” Professor Prasanta K Dey of Aston Business School in Birmingham told PTI there. The training workshops will be held in Ottawa from April to August 2015. Workshops build on some 60 years of lean He said their efforts are aimed at elimination of wastes, management transformations worldwide (starting with reducing cycle time, re-engineering the manufacturing Toyota) and on extensive academic research, especially by process, improving supply chains, enhancing competence UK-based researchers. The lean training is delivered by a of process and manpower by training, energy saving, facilitator with experience implementing lean in the Canadian incorporating reverse logistics systems, reducing federal government. consumption and green productivity.

UK: Daniel Jones awarded honorary title

Daniel T Jones who set up the first such programme in academic research at the National Institute was made an the world at the Cardiff Business School for Economics and Social Research and the honorary graduate in 1999. University of Sussex led to the founding by the University of of the Lean Enterprise Research Centre Buckingham at “Our honorand is also the founder and at Cardiff Business School. He went on to a ceremony chairman of the Lean Enterprise Academy establish the non-profit Lean Enterprise on Thursday in the UK, a senior advisor to the Lean Academy in the UK. 19th March. Enterprise Institute and mentor on applying lean process thinking to every It is the first time a senior lean figure has type of business. Together with James received such academic recognition from Womack, he is the author of influential a university. He was one of seven honorary books that describe the principles and If you have any news that graduates which included Sir Roger practice of lean thinking. Professor Daniel you think would interest Bannister, Sir Magdi Yacoub, Sir Graeme T Jones said: “This is the first time that and benefit the lean Catto, Sir Oliver Popplewell, Professor lean has been recognised in this way with community please let us Barbara Cannon and Bernie Marsden. the awarding of an honorary doctorate by know. Send submissions to the a university. Buckingham is developing its commissioning editor University orator John Clarke said: lean capabilities and this is very welcome.” Andrew Putwain: “Buckingham recently launched an MSc in [email protected] Lean Enterprise; indeed, the first cohort Professor Daniel T Jones carried out of students is graduating today. The pioneering research which uncovered programme owes much to Daniel Jones, Toyota’s lean management system. His

www.leanmj.com | May 2015 7 The Lean Top 25

The Lean Top 25 The LMJ presents the Lean primarily those involved with any of the to get involved and nominate who they following three criteria: think has done outstanding work. Top 25. The inaugural celebration of the lean Involvement and waste reduction: We’ve already had a great list of someone who is passionate about nominations and are still looking for and continuous lean and has created or managed a more. Those who are selected to be improvement community. lean implementation or continuous part of the top 25, are invited to attend improvement change that has seen the networking dinner at the Lean a significant rise in profit margins or Management Journal Annual Conference he Lean Top 25 aims to promote increase in production. in Amsterdam, July 8-9, where the list and encourage those involved in will be revealed, with interviews and T lean in all industries and sectors. Championing: a person publicising biographies in the next edition of the LMJ. As lean advances, we aim to encourage lean and helping its reach grow. those who have shown diligence, Someone who is driving more knowledge The LMJAC will be a fantastic event for passion and professionalism to reducing of lean and creating awareness of networking and learning best practice waste, engaging their staff and continuous improvement. with fellow lean practioners. colleagues and encouraging a better and more productive workplace. Innovation: a lean practioner whose Some of the speakers lined up to deliver ideas and enthusiasm have led them fascinating presentations are: With thousands around Europe engaged on a new path of lean, whether it be Bill Ulyett, lean global director, in lean at all levels there are multiple a minor tweak to the existing way of Astrazeneca people who are doing their best every implementation or a revolutionary idea Howard Bettany, divisional lean day, but we want to highlight those that has been a game changer. manager, Parker Hannifin shining stars who are taking it to the Bernard Auton, director of European next level. LMJ has contacted over two dozen operations, National Instruments industry experts including academics, Tom Slate, continuous improvement The nominations are open to anyone senior managers, consultants, business director, Clifford Chance. involved in lean as a practioner¬ in insiders, teachers and educators, and Europe-no consultants or academics – those with a genuine passion for lean We hope to see you there.

8 INTRODUCTION WRITTEN BY Brenton Harder

Learning lean

aving spent nearly 30 years practitioners – apprentices – designed implementing lean programmes to eventually take the lead from their H across a variety of companies and teachers to sustain our new mindset of industries – from large organisations such as continuous improvement. Similar to the the US Marine Corps, General Electric and early GE model, our practitioners are a mix HSBC to small start-up companies – I’ve of promising young talent and a few very found sustained success comes from a senior managers nominated by the business deliberate balance between generating new to take two years away from their career capacity and developing internal capability. track to learn and apply lean six sigma tools Failure usually follows training too many and techniques. We’ve applied a 1:3:9 people without tangible results, or simply model to our apprenticeship programme driving cost efficiencies with little regard to that has one certified professional coaching developing the skills and mindset for and training three apprentices, followed by sustained improvement. True and lasting each of them coaching and training three cultural change comes back to the old adage more apprentices. Going into our fourth of teaching versus fishing: first show the year, we have patiently arrived at a tipping business what good looks like, then teach point of internally available talent ready to the business how to deliver before getting embed and empower. out of the way to let them go fishing. As highlighted in the interviews with Ian At the Commonwealth Bank of Australia King and Jon Radford in this month’s (CBA), it’s time for our central productivity edition, successful apprenticeship successful team to get out of the way. We’ve spent programmes essentially link leadership apprenticeship the last three years diligently applying with continuous improvement – the two and instilling four simple habits that things that seem to be fundamentally programmes have literally become part of the way missing from most training programmes. essentially link we work across 50,000 employees. It’s Exposing our young talent to leadership leadership with now impossible to take a morning stroll in the early days of their professional continuous through any CBA building or branch development gives them the confidence without bumping into a team huddling they need to be innovative and dynamic improvement – in front of their visual management managers in the future, by giving them the the two things board discussing how to continually skills and techniques to challenge the status that seem to be improve their customer service or lock quo and continually seek a better way. fundamentally in behaviours through their SOPs - four simple habits that have led to new ways of In the end, sustained lean success can only missing from thinking and a sustained lean culture. come from within an organisation where most training programme authorship equals ownership. programmes It’s time for us to get out of the way and What better way to ensure the ongoing let the business go fishing for itself. For growth of our organisations than through the past three years, the CBA has carefully the ongoing growth and development of managed a programme of productivity our people?

www.leanmj.com | May 2015 9 Optimising engineering changes with value stream flow

Tim Healey from Duggan Associates shows the benefits of bringing change in an organisation with value stream flow and a how to guide on implementing these valuable steps.

value streams in the office that are capable of responding it. READ ABOUT: The challenges of change Engineering the perfect The process of engineering change notifications (ECNs), lean office common in most engineering departments, is a good example for illustrating how to design value stream flow Takt capability modes and in engineering that can adapt to high variation. process families Like ECNs are requests for a change to a product design so many The process of Engineering challenges in Change Notifications or manufacturing process. They can be minor (a label change on package) or major (redesign with engineering performance analysis). And they can come from within offices, the organisation or from the customer. Changes from the ariation is inherent in customer often involve a customer-facing employee such accounting engineering. Each job has as a programme manager, who receives or interprets the for variability V different requirements, request for a change then passes it through engineering in mix and demands different skill sets, and requires for the necessary design input, purchasing, finance volume are different approaches. Traditional lean to cost and price the changes, and then management techniques aim to create stability by for sign-off. keys to success removing the variation, creating one-piece flow, and using kanban to pull. The Transformation However, that approach won’t work in Process engineering since removing the variation To redesign a complex office value stream such as ECNs will probably exclude the customer as within a large business, there is a five-step process: well. Moreover, traditional flow and pull in the office is hard to do when each Model sites. Identify a small number (one job is unique and each engineer is a to three) of model sites where model ECN shared resource. So how can engineering 1value streams will be designed and rapidly offices manage such high variation implemented. The key to selecting these locations is and complexity? the energy of the local team, its willingness to learn and adapt to new ideas and processes, and the commitment The answer is not removing the to making real change to the existing value stream by variation, but accepting it and designing participating in educational sessions and experimenting

10 principles & purpose with and supporting new tools that will Another benefit to clearly identifying be deployed. Once the implementation service families is it enables a team to is complete within the model sites, the understand its capability and when it methodology can be rolled out to other has been exceeded. A high volume of sites around the company. ECNs may not be an issue if they are all simple, but how many complex ECNs Process families. A common will it take to exceed the capability of source of frustration among ECN the value stream? By funnelling ECNs 2stakeholders globally is the volume, into a family based on some early mix, and unpredictability of work coming indicator of complexity (identified by in via ECNs. Since teams never know the service family matrix), teams will get how many they are likely to get from one an immediate indication as to whether week to the next and can never be sure they are within their normal capability what they will contain, this high variability (based on both volume and mix), or makes it difficult to plan resource whether they need to change gears (takt availability, often leads to long lead times, A common source capability modes) to get the work done. and typically contributes to long work of frustration among ECN If a company neglects to create these hours for employees. stakeholders globally is families, it may miss the opportunity to understand when its capability has been The key to dealing with these issues is the volume, mix, and exceeded. Careful analysis of service designing a future state ECN flow that unpredictability of work families is a key step which should not be accounts for and accommodates both the coming in via ECNs skipped or rushed. volume and the mix. The first step in this design is to create a detailed service family Value stream mapping. Next, matrix. Using Microsoft Excel, project detailed current state maps teams enter a meaningful sample of recent 3should be developed for each ECNs (at least 100) into a spreadsheet to family, showing accurate process times, analyse both process steps and process wait times, inventory piles, delays with times and determine which path different customers and suppliers and, very ECNs take through the business and the importantly, rework generated by unclear total work content of each ECN. With this inputs or bad handoffs. data, organisations can then group ECNs into families based on path and total work With detailed current state maps in content, which will identify similar jobs hand, the team can then apply the nine that could effectively flow through the lean guidelines for business process flow same value stream. It is important to note to create end-to-end, self-healing flow each family must be treated as a separate throughout the entire value stream. This value stream. step-by-step method of transformation

Figure one: Screen shot of detailed service family matrix for design engineering. Light blue, aqua, and purple shading represent design families to be mapped together.

www.leanmj.com | May 2015 11 Optimising engineering changes Tim Healey

is key to success since it ensures flow is Standard work – Activity-level designed throughout the entire value 6 standard work is the documentation stream, provides a clear future state of the best method for performing design to which implementation results each task. Flow-level standard can be compared, and is teachable and work describes how each activity is repeatable throughout one site or all. connected to the next.

The nine lean guidelines for business Designated sequencing points – process flow are: 7 Specific processes or processing cells at which work can be re-sequenced Takt capability – The designed due to external factors. 1 output of the service family in terms Another common of volume and mix. issue with ECNs Pitch – A preset timeframe that lets 8 everyone who works in the flow Continuous flow – Completing work mitigated by the know whether it is on time in a 2 in a process one, move one fashion. approach outlined visual manner. here is difficulty in FIFO flow – Used when continuous dealing with customers, Changes in demand – Establishing 3 flow is not viable, FIFO (first in, first 9 multiple takt capabilities and out) is a form of flow in which work suppliers, or other creating the ability to toggle moves forward in sequence without external stakeholders between them in order to respond priority changes, re-routes, or to increases or decreases in management decisions. customer demand.

Workflow cycles – The rate at After applying the nine guidelines, the 4 which work moves or flows within next step is to create the future state or between different work areas or showing how each of the guidelines was departments along a fixed pathway. applied. It is crucial future state value stream maps in the office are designed Integration events – A formal using these nine guidelines rather than 5 handoff of information from one kaizen events and brainstorming area of the company to another (this is not a meeting). With ECNs, it’s best to start with the most complex family since the simpler families may be a less complicated subset of them, Figure two: Detailed current state mapping. which then makes future state mapping of the less complex families more efficient. Then, work through the guidelines. The maps should only take a few days to create for each model.

Implementation. Implementation should be short and intensive 4(aim for completion within two months to maintain momentum). Each model site should use a detailed implementation plan showing each task required to make the future state a reality, task owners, and due dates. As a general rule, wherever there is a difference between a current state value stream map and a future state map, there must be at least one action item on the implementation plan to make the full future state flow a reality.

A good approach is to work by implementation loop by breaking the implementation plan into logical groups

12 principles & purpose of activities and then moving through them one by one. streams. Creating standard work for Each map should have approximately two to four loops. handoffs, meaning work should not move The order of loop implementation should factor in metric forward in the value stream if it doesn’t impact, effects on downstream or upstream processes meet all the standard requirements of (the wrong order could flood or starve processes in the the next process, will result in cleaner value stream), team capabilities, and the need for outside handoffs. Less lead time pressure support such as IT or customer engagement. combined with regular intervals for flow will offer employees more time to get Global deployment. Most large companies need to the work complete and accurate before have several different value streams for processing moving it on. 5ECNs at various sites based on differences in customer needs, issues specific to local operations, Another common issue with ECNs supplier availability, or differing product types. For mitigated by the approach outlined here example, there may be more service families at certain is difficulty in dealing with customers, sites due to a larger range of work content. While the suppliers, or other external stakeholders. approach outlined here allows for customisation by site, Whether customers take a long time it will also reduce the variability by region/division by to review and comment on changes or demanding enough homogeneity to maintain common change specifications, or quote times value streams around the world. from suppliers are too long or their response times are unpredictable, every Moreover, while there may be differences in some process time outside input is needed, lead times steps, teams should work to develop and implement are impacted. However, it’s possible to If rework global standards for visual management, lead times, and influence customer and supplier lead quality so any employee or manager can move from site to times both directly and indirectly. occurs at a site and easily understand the status of ECN flow simply by majority of looking at the common visual tools in place. Directly influencing stakeholders can be steps in the done through extended value stream value stream, What to expect from mapping and design activities in which the process companies work together with the it will be One of the underlying benefits of this five-step process customer or supplier to develop a future a drag on for designing an ECN value stream is reduced rework. state flow that meets both organisations’ productivity, Rework can mean redoing tasks multiple times on one needs. Using the nine lean guidelines for drive up costs, ECN. But it also encompasses any time a clarification is office flow is a helpful tool by providing a needed via phone, email or text in order to complete or teachable method for transformation and and increase move work along to the next activity in the flow. flow design and a common language to the lead time describe changes. of the value Rework is a common theme with most office projects, stream regardless of department. And if rework occurs at a It’s also possible to indirectly influence the majority of steps in the value stream, it will be a drag on behaviour of customers and suppliers by productivity, drive up costs, and increase the lead time of communicating with them on a regular the value stream. and predictable cadence using the fourth lean guideline, workflow cycles. For Often, rework results from unclear or unclean inputs example, if a customer always receives from the customer or other requester. Since lead times information on Tuesday and Thursday are usually already too long, companies try to move the mornings at 10 a.m., it will learn it needs ECN forward as quickly as possible to give themselves to do that work on those days and will the best chance of meeting a deadline. That means a adjust to that cadence. customer may often send in a change after the ECN has already progressed, requiring even more rework to be Summary undertaken. Reducing lead times can help significantly Like so many challenges in engineering reduce rework. For example, shortening an ECN’s lead offices, accounting for variability in time from three months to six weeks would give the mix and volume are keys to success. By customer more time up front to clarify its specific needs. following the approach of developing As a result, the team would not have to start ECNs that process families, preparing current state are not well-defined. value stream maps, applying the nine lean guidelines for office flow, future state Another driver of rework are unclean handoffs between mapping, then implementation planning, the customer and supplier, or between internal people organisations can successfully create flow and departments, which is common in many office value through complex office value streams.

www.leanmj.com | May 2015 13 Jason McQuillen is head of managed Lean and law: legal services at Radiant Law, and a commercial law specialist. Here, with Martin Brenig-Jones, of Catalyst a map for Consulting, he presents this article on how to manage contracts. An process and essential business transaction, all too often a time-consuming and protracted process that could easily progress be leaned. ot many lawyers would consider themselves masters of process. When lawyers talk about READ ABOUT: N their work, they typically focus on high-value activities such as advocacy and counselling. But the The mapping of process flows truth is process is a significant part of what lawyers actually do on a day-to-day basis. The world of law and lean Process in the practice of law, stated simply, comprises collating information, packaging it (applying judgement) and delivering it to the client as a legal product. It seems

14 principles & purpose

obvious that good process is critical to objectives), a middle (exchange of the effective practice of law – it’s just that contract drafts) and an end (finalisation lawyers don’t think about it so much. and sign-off).

Historically, lawyers have been known Benefits of process as resistant to change and being slow mapping to adopt initiatives and ideas from One of the key benefits of process outside the profession. Efficiency and mapping is better resource standardisation is looked upon with management through: suspicion, many holding a perception Identifying duplication and that there is some kind of trade-off wasted effort; between efficiency and quality, and that Providing opportunities for the law is somehow too complicated to disaggregation of tasks to ensure the be standardised. Hardly fertile ground right level of legal resource is used at for introducing LSS one might think. each stage; Better understanding of business However, a deeper consideration of the relationships and the handoffs principles and motivations behind LSS and dependencies. demonstrates that it has a natural synergy with law and, applied with thought, can Lawyers are commonly criticised for deliver significant benefits to clients. In over-resourcing matters, usually leading to this article we consider the application higher fees. Clients can be left wondering of one particular technique, process whether it was really necessary for the Historically, mapping, in the context of the production highly paid (and expensive) partner to and review of commercial contracts. complete a given task, or whether a more lawyers have junior lawyer could have achieved the been known The relevance of same result. Pursuing that line of argument as resistant LSS and process further, a client may well question whether to change mapping a lawyer was actually needed at all? Or and being LSS is the coming together of two whether the task even needed to be done? methodologies with a combined focus on: slow to adopt Understanding the customer’s The opportunities for legal departments initiatives and perception of value; and law firms to gain efficiencies through ideas from Improving process flow to reduce a more transparent process are clear. outside the defects and waste; The elephant in the room, however, is Using data to fuel continuous that in the case of law firms, they are profession improvement in a systematic way. often incentivised to duplicate effort (eg. have multiple lawyers attend a meeting) It can be said lean is about identifying or aggregate tasks (have the lawyers and removing unnecessary process proof-read) as they charge their clients steps and reducing delays and six sigma by the hour. is about consistently getting products and services right for the customer. Process improvements in contracting It provides a toolkit for analysing and also leads to more consistent outputs by improving any process, whether that taking the art out of contract reviews. This be production of automobiles, financial in turn reduces risks as process becomes transactions, customer service centres, standardised with clarity of steps. sales and marketing campaigns, HR processes such as recruitment – or William Edwards Deming, the father production and review of a contract. of quality evolution, placed enormous emphasis on the importance of process Process mapping is one tool for to minimise defects. He said: “Eighty- understanding how work actually gets five percent of the reasons for failure done. It provides a visual representation to meet customer expectations are of every step, task, input and resource related to deficiencies in the systems used to complete a business process. and process… rather than the employee. Production and review of a contract The role of management is to change is just a process with a beginning the process rather than badgering (taking instructions and understanding individuals to do better.”

www.leanmj.com | May 2015 15 Lean and Law Jason McQuillen AND Martin Brenig-Jones

Finally, mapping assists in identifying by mapping the current contract process, where the value lies in a given process. warts and all. As tempting as it is to Typically only 10-15% of the steps in a sketch out the ideal state, it is vital to process add value, and usually these understand the current state and steps represent as little as 1% of the set the baseline to get the most out of total process time (taking into account the exercise. delays and the time where the product or service is static). Getting off a blank page LSS provides the following definition of a One popular method used by LSS value-added step: practitioners to get off a blank page and The customer would be interested and start to understand the current state is care about the step; called process stapling. To do this, simply The step must change the product or imagine yourself being stapled to the service in some way, or be an essential thing that goes through the process and pre-requisite (more generously, does it follow it each step all the way through to move the matter forward?); the end. The step must be actioned right first time and is not being carried out as a In the context of producing and result of an earlier failure. reviewing commercial contracts, the first major step in the process is likely When to process map to be intake; how, and by whom, is the Process mapping will challenge the legal team instructed? For many legal It is not status quo, and the way we’ve always departments, the form of instructions the case that done it. When done well, it will illustrate varies wildly depending on who is every step new and innovative ways of working. leading the deal for the company, in a process It is ideal for long-term relationships, which may be a contract from the sales, both with legal departments and procurement or other business team. that does not external lawyers. Does the legal team receive all of the add value instructions it needs to begin the process should be According to Deming: “The result of in one fell swoop, or are the background automatically long-term relationships is better and and business requirements relayed over better quality, and lower and lower a series of disjointed calls and emails deemed to costs.” If you add faster turnaround to attaching out-dated or incomplete be waste and that, you get closer to the holy trinity documentation? After the matter has discarded of products and services delivered at landed in the legal department, how is the right quality, time and price. For the work triaged so it is undertaken by legal departments, mapping facilitates the right level of resource? onboarding of new staff more quickly as they can see and understand how work Next, examine how the work gets done. gets done. For law firms, it also assist in Likely sub-processes include: pricing matters more accurately due to selecting the correct contract template / the certainty it provides. playbook and completing the first draft; marking-up and negotiating the terms How to process map (multiple drafts); Process maps can take a number of capturing and escalating different forms and, depending on outstanding issues; complexity, involve numerous sub- proofing the final wording and tidying processes. Commonly used forms include the contract. swimlane diagrams, value stream maps, organisational process structures and When the content and wording or the the more comprehensive SIPOC models contract are settled, there will likely by (which details the interplay between further sub-processes including: suppliers, inputs, process steps, outputs internal approvals, signature and and customers). exchange of executed versions; extraction of contract data for Regardless of the type of map deployed management reporting; (and it is usually beneficial to deploy uploading the contract to contract more than one), it is important to start management system and related

16 principles & purpose

administrative efforts (such as filing Will the customer care (or even related emails). notice) if a step is undertaken by a different resource, is automated, or is Each of these steps must removed altogether? be documented. Getting the most Focusing on value from your map Once you have mapped out the steps in Process mapping will often draw your current process, turn your focus to out areas of ambiguity and the qualitative aspects of those steps. misunderstandings around handoffs Which actually add value? As stated and dependencies between various earlier, this is typically only 10-15% of business functions and stakeholders. steps, and these may represent as little as For example: 1% of the total process time (taking into When is the legal team involved in account delays and the time where the drafting the services description and product or service is static). service levels? Is it the responsibility of the legal LSS practitioners use various acronyms team or the business team to obtain to remember the categories of waste necessary approvals from the IT in a process, such as TIM WOODS security team? or DOWNTIME. In the context of Who is accountable for getting the production and review of contracts, contract signed? waste may commonly include: Transport: movement of contract Use your better understanding of the parts between stakeholders (eg for Process mapping process to not only remove waste, but input or approval); will often draw out also to build more transparent and Inventory: WIP and completing areas of ambiguity and sustainable working relationships. It may contract parts ahead of time; be useful to develop a RACI chart to sit Motion: looking for information (eg misunderstandings alongside the new process. due to a poor contract management around handoffs system or contract template library); and dependencies The process map can also serve as Waiting: waiting for stakeholder inputs between various a data point for making investment and approvals; decisions aimed at minimising defects Over-production: too much volume business functions and and improving overall quality. For and detail beyond that required; stakeholders example, should the legal department Over-processing: too many turns of the be spending more on its contract contract and double checking; template library, both in terms of Defects: use of inappropriate contract content and accessibility? template, unclear drafting or invalid sign-off; Final word Skills: using senior lawyers when Process mapping is one tool in the LSS talented juniors (or non-lawyers) could toolkit for process improvement. Its deliver to requirements. power lies in the benefit for the user in having a visual depiction of a process, It is not the case that every step in a end to end. Whilst individual steps may process that does not add value should seem sensible on their own, this holistic be automatically deemed to be waste view quickly demonstrates how waste, and discarded. There will be some rework and unnecessary movement can steps which, although not value add so easily creep into any process over time, according to the strict LSS definition, are resulting in inefficiency and unnecessary nevertheless essential. This may be for cost as well as increasing the likelihood regulatory, policy, health and safety, or of defects. similar reasons. For these steps, consider if they can be moved to a separate In the production and review of process, or at least how to complete commercial contracts, a process in which them in the most efficient way. quality of output and quick turnaround are at the heart of client needs, it seems Remember that it is the customer’s only too right LSS methodologies and perception of value that is important. process mapping is now on the map.

www.leanmj.com | May 2015 17 READ ABOUT:

How to implement a lean supply chain

Warehousing, stocktaking, classifications: the best way to do it

he current economic climate, with tighter controls on cash flow and T credit limits, puts even greater Partnership emphasis on supply chains to reduce costs, inventory and throughput times. Whilst many companies have applied lean principles to great effect to address these development: challenges within their own facilities, their application across the supply chain boundaries is far less established the route to lean Supply chain cost reduction strategies typically focus on high value inventory identified using ABC classification. Increasing delivery frequency, kanban supply chains, or sequencing usually, requires some level of investment in process flexibility so the levelled mix of product can be produced within the required takt time. part one. Consignment stocking simply passes the stock holding costs on to the supplier, who will invariably recover them through Andrew Hemmings, managing director of Tier Link some other means. Limited, a supply chain management company primarily Transferring production overseas to low operating in the automotive and aerospace sectors, teaches cost manufacturing bases can generate us supply chains and the best to drive efficiency. significant cost benefits. However maintaining price competitiveness requires cheap transport, usually in the form of container ships, which is off-set by longer lead times. Invariably overseas orders are based on forecast requirements, which will increase exposure to product mix changes.

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Figure 1: Supply chain concept

Clearly, the longer the lead time, the stock as protection against processing greater the exposure, unless there are failures and demand changes that fall The local stock consolidation arrangements, inside manufacturing lead times. common but from which product can be pulled. somewhat Procuring materials from approved The reality for many companies is sources adds further complication and cost reduction of inbound materials oversimplified potential lead time implications as does (including transportation) is driven by concept managing returns in the event of rejects, purchasing functions measured by cost of supply particularly if there is any dispute over saving KPIs, whilst management over chains is of standards or liability. The approach is inbound materials delivery is driven generally best suited to stable products by a material planning and logistics a structured having a predictable demand with function, measured primarily by pyramid ready access to raw materials and outbound delivery KPIs followed by stock manufactured through processes having holding KPIs. For many, whilst there is high process capability. a functional link between purchasing and MP&L, purchasing is a centralised Purchasing agreements that incorporate function, whilst MP&L is site based and year on year cost down targets leave often reporting into operations. achievement in the hands of the suppliers, who can find themselves financially The focus on driving inefficiency and squeezed between agreed customer waste from the combination of processes targets and raw material price increases that manage the supply pipeline, imposed by large conglomerates, over particularly across company transaction which they have little influence. boundaries, is greatly overlooked, yet it presents what is probably the most The effectiveness of these common significant opportunity for improvement strategies is often limited by each and cost saving. However, it will require supply chain member acting as a the supply chain functions to re-think separate entity. Furthermore, whilst the way in which they interact, which cost minimisation is always high on the is often the result of the complex inter- agenda of any supply chain manager, dependent supplier network in which the priority is always protecting the they operate. customer, closely followed by protecting internal manufacturing processes. This Supply chain invariably takes the form of inventory, architecture either as raw material to safeguard The common but somewhat against supplier delivery or finished oversimplified concept of supply chains

www.leanmj.com | May 2015 19 Partnership development Andrew Hemmings

Figure 2: Supply chain reality Diagnostics built on APICS supply chain best practice assess supply chain management performance against five key attributes:

1. Lean implementation Effective implementation of lean within the four walls of any business requires structured deployment, having future state goals linked to business objectives. Because the supply chain crosses the company boundaries, it becomes even more critical to develop a documented policy for implementation in order to both support active cooperation as well as drive improvement across boundary transaction points.

End-to-end processes need to be understood by all supply chain partners to is of a structured pyramid, having a primary contractor enable collaboration in eliminating non- or OEM at the top, linked to an increasing number of value-added activities. The focus should smaller suppliers sitting in sub-tiers. Influence can be be on waste elimination and not cost exerted over the tier beneath because of buying power. reduction as a pre-occupation of reducing Whilst this may be the case for the OEM and some Tier 1 costs may lead to oversight of waste suppliers, below this the number of suppliers can reduce activities, as not all have direct financial significantly, along with influence from the level above. cost. Cost reduction will be an inevitable consequence of waste elimination. The reality is a pentagon within which there are transactions in multiple directions and across tiers. The 2. Partnership and complexity of this network means whilst some issues integration may be exposed, the underlying causes remain hidden. Effective Supply chain partnership is the vehicle Furthermore, tackling issues in isolation presents the control over by which overall results are achieved. danger of following a sub-optimisation route such Without collaboration and thorough that problems solved in one area will often emerge the demand understanding of the supply pipeline, elsewhere in another form. Effectively improving the signal requires partners cannot maximise the added situation therefore requires examination of the overall supply chain value to the customer. The supply chain process in sufficient detail, in order to fully understand members therefore needs to have a documented the implications to the supply pipeline. to jointly vision supported by common KPIs and objectives, underpinned by a structured Lean supply chain understand improvement strategy, having plans and The concept of lean supply chain aims to address demand as objectives which are ultimately aligned to these issues and can be summarised as supply chain well as its the objectives of the customer base. optimisation combined with the elimination of waste impact on by the collaborative application of lean principles Improvement becomes cross- and supply chain best practice. This is supported by the supply enterprise and collaborative with jointly developed standards, measures and disciplines, pipeline activities at site level contributing to the achieved by viewing the supply chain as a single system bigger picture. Team members become or value stream. supply chain focused as opposed to organisation focused. Amongst the potential benefits of collaboration between the supply chain functions is end-to-end 3. Demand visibility of the supply pipeline, enabling control management over location and size of buffer stocks. Joint analysis Pull is one of the five principles of lean, and planning has the potential to eliminate demand and managing system demand so that amplification generated through poor signal control and product replacement is only triggered by incompatible MRP lot sizing, as well as improve overall point of use consumption downstream system responsiveness. is always the objective. Ultimately the

20 principles & purpose driver is point of sale demand, which Figure two: Lean supply chain diagnostic - transition from poor to objective performance when conveyed electronically upstream in real time to all members of the supply chain, should trigger replenishment without volume change. The reality of transport economics and pallet factorisation may however result in shipping quantities being larger than point of use demand, in which case shipping loads should be levelled.

Effective control over the demand signal requires supply chain members to jointly understand demand as well as its impact on the supply pipeline. Operations planning, if also collaborative, can utilise shared plans and sales data to form a coherent strategy that meets the supply pipe line requirements.

Demand amplification is a well- documented consequence of poor demand management or signal control and is a measurable that impacts on cash flow.

4. Flow Continuous flow applies equally to data transfer as well as manufacturing operations. Transfer processes should allow the free flow of demand information and avoid large timescale batching. Standard processes 5. Standardisation for production planning and inventory Data exchange should use global and/or control should be defined across the industry standard formats as conversion supply chain in order that data transfer interrupts flow, is a cost and can lead to can be quickly assimilated. Functionally costly errors through misinterpretation. managed structures enclosed The relative ease by which large volumes within company boundaries need to of data can be transferred also presents shift to horizontal thinking, where the danger of information excess, which system efficiency overrides can both congest systems and potentially functional performance. Cost cloud decision making. Information reduction should only relate to supporting the Interruptions to product flow, created by defined objectives, and any excess to that individual supply chain members holding will be an needed can be classed as waste. unnecessary safety stocks are eliminated inevitable by creating strategic buffer stocks, the size consequence The incorporation of industry and location of which are set to maximise of waste standards into new product design system efficiency. Toyota uses the term and development processes leads standard inventory to define the minimum elimination to standardisation and sharing of required to support customers in a value components, both of which impact on stream at any given time. With the buffer manufacturing costs, inventory holding stock size and location set, processes costs and throughput time. Raw materials can be developed for reducing inventory can also be classed as components to holding costs, lead time. Internally, set-up which standardisation can be applied. and change-over time is seen as a key The implications of added complexity and performance driver, with incremental its impact on, stock holding costs, part reductions in set-up time generating numbers, set-up costs, transactions and corresponding reductions in batch size. fixturing costs are rarely measured.

www.leanmj.com | May 2015 21 READ ABOUT: Apprenticeships: The renaissance of apprenticeships

The benefits getting in touch with emotional intelligence beyond the The thoughts of industry leaders in staff development technical into this needs to therefore take note. An over-riding criticism of lean is that tools Director of training provider Evoke and methodologies (5S, shadow-boards, People Development Joe Bell, makes kaizen workshops) take precedence over philosophy and culture. So perhaps the case for immediate investment in the lesson to be taken here is this. A apprentices, above and beyond the high-performance engine is great, but if the driver behind the wheel is not departmental rotation and technical empowered to change gear as and when upskilling usually offered. they deem it necessary, they might travel everywhere in first gear. This is where behavioural flexibility and emotional self- awareness becomes just as important as pprenticeships are big news at the in my experience I have witnessed many technical nous. moment. Ed Miliband looks to apprentice schemes being one-dimensional A secure votes by guaranteeing and overly-focused on mechanical and Daniel Goleman – crediting in popularising apprenticeships (if grades are achieved), electrical up-skilling. I contend that if we the concept of emotional intelligence – whilst the coalition government pledges to are to get the best out of our apprentice famously contended that any professional fund three million apprenticeships through workforce a more far-reaching and holistic (such as an engineer) required an IQ of 115 additional benefit capping. view is required from day one. to be able to function successfully within their role. Studies and research back this Apprentices can form an essential part of Any organisation that is on its lean up. Goleman went on to conclude that no an organisation’s talent pipeline, however journey and looking to plug apprentices research exists that indicates having an IQ

22 principles & purpose

above this level predicts EQ-i 2.0 Model success in life or work. In short, 115 is a necessary level of IQ-however it is not sufficient to guarantee success beyond this. So individuals displaying an IQ of 116 are on par with those at 160.

Success beyond the 115 mark, Goleman contends, is then down to an individual’s emotional intelligence. EI becomes the key differentiator. Once more, research corroborates this. When we bring to mind the most effective leaders in the organisation it is rarely When those with the biggest we bring to brains. It is those who can mind the communicate their ideas effectively, empathise most effective situationally, be assertive leaders in the when appropriate, organisation involve others in problem- it is rarely solving and provide those with timely feedback. the biggest Organisations are starting to wake up to journey, we looked to move beyond the traditional fixation brains. It is this and are looking to use this information on attraction and recruitment of apprentices. We knew those who can intelligently. This means trying to find that to create a growth mindset – and for lean to work communicate ways to shape behaviours early on in an – leaders at all levels must be empowered to contribute employee’s career and developing the and ensure they are influencing others to contribute their ideas human side of the individual. With the also. It was essential that all team-members had a clear effectively apprentice population this means taking understanding of their contribution beyond implementing into account the modern working world the system. Formal education was ineffectual in and helping them become effective as influencing hearts and minds. We knew that investment early as possible. was required to help individuals understand how they contributed to the system and what may be holding them Louise Edwards, principal consultant of back. EI was the key to unlocking this. Liberty Learning Solutions, captures this well. “Traditional firms can struggle with We found that profiling an individual’s EI had the mindset of Generation Z: apprentices multiple benefits. are linked, instant and demanding. They are ultra-responsive and used to Firstly, it gave individual’s personal accountability getting information immediately. Helping by providing a framework to understand how our them connect with the organisation’s individual contributions were more or less effective. thinking is almost as important as task- It also reassured team-members that the organisation accomplishment, so using tools that was not trying to brainwash everyone into a way of generate insights to promote personal behaving. Culture is created by a mass of individuals accountability and stretch are vital. choosing to work in a certain way. It is a collection of Emotional intelligence is a good starting explicit and implicit norms formed top-down, sideways point for action.” and bottom-up. An organisational culture is fragile and simply cannot be safeguarded by applying pressure Working closely with a progressive from the top down. To be effective and sustainable it manufacturer some way on in its lean needs to be built upon free-thinking, shared beliefs

www.leanmj.com | May 2015 23 APPRENTICESHIPS JOE BELL

and perhaps the strongest motivator relate to others? How do I emotionally is our belief that we are valued in our self-regulate? EI is developable (versus contribution. This includes deciding IQ, or personality), so displaying different whether the current system is the most behaviours can impact others and in turn effective way of operating. In effect, impact our EI. applying EI encouraged freedom of thought and action within the lean Applying the same EI profiling to collective system. This is where an apprentices we found a difference. insight into an individual’s EI was able to Emotional expression (constructively pay dividends. stating emotions) scored highly as did interpersonal relationships (creating Emotional intelligence indicates the level mutually satisfying relationships). The low- of functioning at a social and emotional scoring dimensions were independence level. It is able to measure – through (working freely away from others) and a self-perception diagnosis – how we self-regard (assuredness, feelings of index in composites such as self-regard, confidence). This information allowed us emotional self-awareness, empathy, to understand that working collaboratively assertiveness and emotional expression. was a driver for this group, as was feeling How can this help? When we applied it connected socially to others and belonging to 50 manufacturing team-leaders (TLs) to a meaningful institution. Lower levels we found some similarities in profiles of self-confidence are predictable given that were telling. Emotional expression Apprentices the age/experience of the group’s profile; was very low, as was empathy. Both however the emotional expression dimensions under-indexed considerably can often interaction allowed the organisation to versus the norm (when compared to traditionally be find forums for the group to share their professionals within UK/Ireland). In subjected to a ideas and contribute at an early stage. contrast, assertiveness and independence single track of scored very highly, similarly over-indexing. In summary, apprentices can often development; traditionally be subjected to a single track This may seem unremarkable when the of development; the development of their viewed in isolation but when viewed as a development technical competence and skills. This is contributor to organisational culture the of their necessary, but not sufficient in 2015. Equal results take on new meaning. Consider consideration to the emotional intelligence the subscale interaction between technical dimension of their contribution is required. these scores. Low levels of empathy – competence Not only does this provide the individual understanding and appreciating others – and skills. This with education and information on how coupled with high levels of assertiveness is not sufficient they prefer to communicate and interact, – stating views in a forthright manner. We it also gives the organisation data on found that coaching was low down on in 2015 how best such a group can be managed. team-leaders to-do lists; influencing and Progressive companies understand that persuasion were also of a lower priority. they cannot wait until the individual Developing others was unnatural to this has formulated mature views on the group who were energetic, task-focussed business before investment in personal and strong-willed. effectiveness and style is given. A dual- track strategy is required immediately: The EI profiling allowed a dialogue and technical and behavioural. understanding to emerge with TL’s. Different ways of behaving were discussed. Mark Davies, HR director for companies It allowed a framework of discussion as such as , SCA and Nufarm well as training and development to equip captured this well: “Forward thinking TLs’ with tools to help them get the best companies understand apprentices from their team. Infact the lessons were schemes are a long-term investment. so powerful it convinced the organisation It isn’t just the recruitment, it is the this would be beneficial earlier in the programme they follow and the employee lifecycle. Hence applying this formation of a developmental mindset to apprentices who could have their that determines their impact. It is the awareness raised and appreciate that it is insights, mentoring and coaching that the engagement/interpersonal dimension strengthens the talent pipeline and helps with others that bears results. How do I them realise their potential”.

24 SECTOR FOCUS APPRENTICES SECTOR FOCUS

Lean apprenticeships: lean for the next generation

Manufacturing has suffered a lot of bad press over READ ABOUT: the years, and here in the UK our politicians in all Lean apprenticeship their infinite wisdom decided making things was courses offered too cost inefficient to have any place in a modern The benefits of training at the beginning of a career instead of economy, and instead looked to banking and filling in the gaps later on service sectors to supply our GDP. The plans for future incorporation

ith the great recession, the buzzterm) is apprenticeships. One way of doing this is to teach the emperor turned out to be naked Apprentices are an ingrained cultural young people embarking on their careers W and many discovered that institution in Germany, like they were all about lean from day one. finance wasn’t all it cracked up to be. once upon a time in Britain. Now the UK government is hurriedly They’re slowly returning, but the Instead of teaching an old dog new tricks, trying to rectify the wrongs of the past. process is painful. why not teach them as they learn, the Look to Germany, where manufacturing benefits of continuous improvement has been the backbone of the economy As national apprenticeship week and LSS so they can help to make their since modern Europe came into being. It’s took place recently, LMJ went on an industries as profitable and streamlined as the largest economy in the EU, and seems investigation to explore how apprentices’ they can. to be having to hold the Eurozone resurgence was going, and how lean was together all on its own. helping in this. With nearly two million This article includes interviews apprentices in the UK, they seem to be with apprentice scheme trainers at One thing Germany takes seriously taking off, but with endless pressure two different UK organisations, which the UK is far behind in, and it must from low-wage economies and emerging determined to help young people, do better at, if it hopes to ‘rebalance powers in the east, it is important for the as well as several apprentices at the economy’ (the current government industries to be as efficient as possible. AMRC’s academy.

www.leanmj.com | May 2015 25 SECTOR FOCUS APPRENTICES Lean in the works:

Manufacturing growth lead at EEF, Ian King, discusses with the LMJ his thoughts on the organisation’s lean training academy, based at Aston, Birmingham. The academy works at giving a rounded lean education to not just young people, but also manufacturers of all levels and ages, so they can learn about change and continuous improvement.

Ian, what’s your were first rolled out in North America by background and how did Ford originally. READ ABOUT: you go into coaching lean? Ian King: I’ve worked on the academy The academy has been adopted by Teaching lean to the since 2012, and before that I was JLR, Airbus, BAE and JCB. A number of next generation freelance, working for many large organisations are now using this approach. companies, including healthcare and Incorporating lean into a well- mining corporations in Australia, setting The teaching covers a basic introduction rounded education on business, up lean academies and working with to lean and techniques and culture and management and the basics their employees. I have of economics also worked with Airbus, BAE Systems, Triumph, The EEF’s training scheme Williams Formula 1, in Aston Bisley, Terex, Rockwell, We’re trying to encourage Dunlop as well as people to engage in lean and many SME’s helping continuous improvement and to implement lean organisations. change programmes

How long has the programme been running and how long have you been the way we learn and change behaviours. involved with it? We use a blend of academic materials, IK: EEF have had an improvement service such as case studies from the Harvard since 2012. And I was the first recruit. School of Business on companies like Before this they ran the Manufacturing Toyota, Herman Miller. From there we Advisory Service in the South East for a move on to the cultural side of lean. number of years. How important do you Run me through the think properly educating layout of the programme. apprentices are to the future of What do students learn about? manufacturing? IK: The lean academy is designed to be IK: It’s not just our apprenticeships, run from different client’s request as but other organisations to teach about well as my past experiences in what has lean. In fact, a conversation I was having worked best. These type of schemes recently was about this very topic: the

26 SECTOR FOCUS reason I was training at this organisation is because before. Which has convinced me that I the current leaders sees their apprentices as the future don’t think we educate our apprentices leaders. And yet they know very little about business and future leaders enough. We see the improvement- one of the students couldn’t relate to the need for engineers and toolmakers but fact that if something in the factory can be made more we don’t give them other skills. As they efficient it can be made more profitable. progress they have no managerial skills or leaderships skill. So for me the future looks Considering the UK/Europe has been on a continuous like we need a greater rounded awareness. improvement path for over 30 years, it is quite worrying We need at least an awareness in that our future leaders are not being taught about some of the most commonly used lean continuous improvement at even a basic level. tools/ techniques

That’s why we are teaching our apprenticeships So we aim the course at everyone. The about leadership and improvement- the two things old way of recruiting a manger was by fundamentally missing from most training programmes. recruiting someone form the lower levels Most Further Education schemes do not have these and of the company and promoting up as a apprentices are not taught how to improve the business. reward. That doesn’t always work. We often see capable engineers don’t make the best In terms of whether I think teaching apprentices basic managers, so we’re trying to encourage book-keeping or managerial skills as a more urgent need people to engage in lean and continuous in teaching continuous improvement? They’re both vital. improvement and change programmes and Fundamental is the cost side of a business to be taught. The lean hopefully improve their skills as a leader. These days, trying to find an engineer under the age of 50 who understands costing is difficult. academy is What other aspects do designed to you think you could add to And when you look at companies (that I work with) they be run from improve lean education? don’t understand the basic costing of the product of their different IK: What we’re trying to do with the manufacturing. One client I work with produces £75k per academy is target change leaders, and the week worth of goods and they’re lucky if they make £250 client’s biggest aspect for me is the mentoring and profit. It’s nothing to do with 5S or kanban it’s just poor request coaching one. organisation modelling and product costing. as well as my past Retention is a massive problem. Getting The majority of my clients are people who have done to them a few hours a week so it stays CI programmes. It’s not the operations, it’s the other experiences in their mind. If we look at the Japanese areas of the business such as technical, sales, marketing, in what has and how they do things, their change materials and the way accountants choose to costing worked best programmes are often not just training but things. For example a client I work with may cost a also coaching/mentoring in the workplace. product to achieve 45% contribution and sales will sell at They receive refreshed courses and new that price however when you understand the operation training throughout their working life. that contribution can be some 20% diminished due to Whereas we tend to undervalue this and the people in accounts and sales not understanding the focus merely on the initial course and then operations side of the business. let maintaining these new skills fall by the way side. What are the plans for the training scheme in the future? Have you seen a marked IK: The future lies in my own career path and my own difference? apprenticeship -I gained no business acumen while I IK: The more we talk about lean and do was being trained. I was taught nothing other than the around Aston the more we’ve definitely manufacturing skill I was employed to do. had a marked improvement around the apprentices’ confidence and abilities. You I was mentored as I progressed with my career and can discuss 5S with them and they can grew to understand the way things operated, I then show you examples and talk about you with went on and did a Beng in Management which taught it. A massive improvement from their skills me some business and how a full organisation works, when they first arrive. doing modules that gave me the basics in all areas of business not just operations and engineering. This is a great difference to other places where the apprentice will have no This exposed me to quality, purchasing, managing and lean skills and no vision for their or the a range of other topics which I’d never encountered business’s future.

www.leanmj.com | May 2015 27 SECTOR FOCUS APPRENTICES Educating apprenticeships

READ ABOUT:

Getting and keeping apprentices engaged with lean

The benefits of getting ‘em young

How the scheme works and the plans for the future

How long has AMRC had a pressure magnesium die casting company lean training scheme? Meridian Lightweight Technologies John Radford: We first started delivering Ltd. With my previous experience, it Jon Radford, AMRC lean training in 2014 as National wasn’t long before I moved from being Vocational Qualification (NVQ) Unit a supervisor to leading continuous 64: conducting business improvement improvement activities, providing activities, as a bolt on for technical support statistical analysis and encouraging change The Advance apprentices. They have to cover three and engagement. After the recession I units so we thought that would be good decided to change careers and moved into Manufacturing Research for this pathway. training full time, which is how I am able Centre (AMRC) is a to work on developing this programme for Since then, we have now changed the the apprentices. government catapult units around, after my line manager, centre based in the north Roger Davis-Green, decided every What benefits do you apprentice that comes into the building see to lean involved of England, associated should have a week’s training with me, with apprentices and what does the with the University of for which they receive a certificate. course teach? JR: The benefit for us is we get a chance to Sheffield. The AMRC Depending on the company they work introduce lean and best practices before specialises in advanced for, each apprentice at the AMRC Training the apprentices go into their working Centre spends either 24 or 48 weeks environment, where it may not currently machining and materials learning all aspects of their trade, and exist. On the other hand, if their employer research for aerospace the idea is they should spend at least one has implemented lean and best practices, week with me getting the basics of lean. it won’t pose any surprises when the and other high-value apprentice arrives at work on the first day manufacturing sectors. What’s your background? and sees a 5S audit board. JR: I started as an apprentice many years ago and spent 18 The major benefit is the chance to years in the aerospace industry, working heavily promote team working towards for Doncasters Machined Airfoils. a common goal at an early stage. The on Radford is an engineering majority of our apprentices are on trainer and skills assessor at the I went through the ranks culminating in machining pathways such as manual J Sheffield AMRC Training Centre. my becoming continuous improvement turning and milling, we also have He chats to LMJ about the training manager. The company put 10 of us from electrical/electronic, tech support and scheme in place at the centre to teach around the world through a kaizen black fab & weld apprentices. the apprentices the benefits of lean. belt course with TBM Consultants in Derby in around 2000, so I’ve had 15 years of All engineers are heavily involved with Since introducing business improvement lean experience. measurement. I start the week off with techniques (BIT) in April 2014, 77 a measurement system capability and apprentices have received the training Then the company moved and I decided calibration project, culminating in a with a further 40 scheduled onto BIT by not to relocate with them. I moved into gauge R&R exercise using five separate the beginning of summer 2015. the automotive industry, joining a high measuring devices. By plotting graphical

28 SECTOR FOCUS variation then eliminating unreliable by splitting the group into two teams equipment, I can easily demonstrate the normally four or five per team. They importance of equipment selection and have a competitive streak so we find ultimately how to best achieve repeatable this a really good way of keeping things accuracy between operators. engaging and stimulating especially as the final challenge is to build three kits We run a number of experiments where simultaneously in the factories they they’re encouraged to think about have designed. The best visual controls vernier scales, often when reading the and lean assembly lines in place always measurement debates between operators achieve the best results. Our current can get quite heated. record stands at 79 seconds for all three planes using four operators, not bad The subjects we currently include in BIT considering there’s 85 pieces in each kit. are measurement system capability, 5S, The 8 wastes, which obviously includes On the last day of training we go for a little history on Henry Ford and Taiichi a tour of all current AMRC facilities, Ohno, The five lean principles and, finally, these being The Factory of the Future, a practical exercise that normally lasts for Integrated Manufacturing Group, two days, where the apprentices can put Nuclear AMRC, Composite Centre and the methodologies into practice. Along The Design Prototype and Test Centre. the journey I introduce them to basic The apprentices get to see best practices lean tools for making improvements to within a practical environment at first- processes and operations such as kanban hand. Innovative ways of manufacture systems and visual control so they get an combined with the very best technology is overview and a basic academic knowledge. The five what the AMRC is about. 5S helps form the basics of working in lean principles What skills do you see the a more organised environment with help them apprentices learning from everything required to hand. Eight wastes understand the scheme? is an overview of what they are, where on a higher JR: It’s great to see the lightbulb come on they are found and how we reduce them in their eyes. By learning about lean in using lean tools and control measures. level how a a fun way, they’re really able to see the lean business benefits; linking the industrial side to the The 5 lean principles help them operates lean framework and the more academic, understand on a higher level how a lean classroom sided elements, and the business operates. When I set them off on connection comes when I take them on to the practical exercise they receive relevant the factory floors around the AMRC sites. statistics relating to costs for running a It’s a good start for them to learn to work factory and assembling the products, such in a tidy manner and keep what they need as cost of purchasing the kits, energy price at hand. You can see, before they’ve done and usage, build time and orders for TAKT, the course, they have everything out of the staff costs etc. As build times are reduced workbench drawers, because they haven’t profits increase but never losing sight of thought about what they need. a safe operating environment and quality products for the customer. Whereas I operate a two tool rule - only two tools allowed out of the box at any We do the practical hands on using one time, to minimise clutter and mess. models; it’s basically a Lego seaplane kit, which they try to build to TAKT Time. There are lots of other examples: linking Customer orders are set by me and often modular builds. They don’t realise they change depending on how well the group don’t need to build the whole thing. is progressing. Using 5S principles and lean The kits really help set them off on the methods they run trials then implement right foot in a fun way. The scheme is changes to improve their process in its infancy and I’d like to see how efficiencies, learning about flow and push/ these apprentices have developed in the pull systems along the way. workplace. I’ve collected feedback forms from them, and it’s all positive so far Most of the apprentices are between and all have said they enjoy it but I want 16-20 years old, I run the practical to see how they carry on with it once

www.leanmj.com | May 2015 29 SECTOR FOCUS APPRENTICES

they’re back in their workshops and factories. It’s all over time by expanding on what works best to gain the about encouraging them. understanding. We’ve also got a professional development side based at the Training Centre and they are working Do you think there are other or more hard currently on introducing a lean manufacturing course things to be done to teach lean? for fully qualified engineers and tradespeople. JR: Interestingly, I’ve trialled a practical exercise on our factory floor. We were going to supply aluminium dice to We’d also like to reintroduce Unit 64 so they get a NVQ in Las Vegas. It got them thinking about orientations, there this and a certificate to give lean a solidified place in their are so many permutations, different combinations and view. The course is a work in progress and I introduce new ways of doing things, and it really had them engaged in ideas and tweak elements and try my best to keep them the planning aspects. It was very much geared towards focussed and interested. an industrial environment using workshop tools and machinery during production and they were learning What benefits to manufacturing as a from the mistakes they made. whole do you see this giving? JR: UK manufacturing has to keep moving forward. In We culminated with a poka-yoke box style fixture the dice my mind the sooner apprentices are exposed to these slid into, with the holes pre-positioned all we did was drill principles the better. Obviously, lean tools and techniques through to a fixed depth stop, and that seemed to be the are by no means new but you still see a lot of waste most valuable aspect demonstrating how a simple idea opportunities that only require simple fixes. We have worked consistently every time: By encouraging them small company apprentices’ right through to Rolls–Royce to think for themselves and a hands on trial and error apprentices, no matter who they are working for waste is approach they come up with half the ideas themselves. still evident and waste reduction is key to success.

Where would you like to see Manufacturing methods are fast changing and companies the scheme go? have got to move forward. You don’t necessarily have to JR: I really enjoy working with the apprentices at grass change an entire process, just look at how you’re doing it roots level and our course itself, is continually improving and change elements. This is not rocket science. The students’ perspective:

Rowan Easter-Robinson is an apprentice from Darron SBO, a steel manufacturing and engineering based in Sheffield, Matt Creswick is from Toolroom Engineering Ltd, a precision engineering firm also in Sheffield and Jack Smith is an apprentice at Rolls Royce. They all underwent the training at AMRC and discuss the benefits from the training he received. Even though the firm doesn’t have a lean programme.

What was your knowledge experiences. I also found it interesting to of lean beforehand? learn the origins of lean manufacturing READ ABOUT: Rowan Easter-Robinson: I didn’t know and how it helped to transform Japan anything about lean manufacturing into one of the most economically What the apprentices learn (in before the course, I’ve never had any developed countries to date. their own words) experience with it. Matt Creswick: Before undertaking the The confidence and skills it Jack Smith: My own personal knowledge training I had no prior experience of lean. gives them was limited to the very basics of not wasting time. However, it was easy What were the main goals for me to understand and apply lean you were hoping to learn manufacturing after previously working from the training? in industry. I was able to relate the RER: I first started the course with an wastes and methods to my own personal open mind, as I had never done any work

30 SECTOR FOCUS on continuous improvement or lean before, let alone being able to apply those concepts to a working environment. This meant I decided to try to get a basic People my age have knowledge of the theory but also try to had very limited, if not non- put emphasis on applying these concepts existent, exposure to production/ to a working environment so I could engineering environments understand how to work them into my experience at my own workplace.

JS: Our goals were: to understand how I never find myself searching for missing tools and the seven wastes can impact on the equipment. I will continue to retain the skills I have profitability of an industry, how to learnt as find myself using them every day. identify and overcome the seven wastes by using the 5S’s. MC: I believe that I learnt very useful skills from the training that I will hopefully be able to implement when MC: I was hoping to gain a greater I’m back with my company. understanding of what it meant to be lean in industry. Do you feel engaged and confident enough to begin implementing lean? Do you think you learnt RER: I’d have to research more how these concepts would practical skills from the be more applicable to the workshop in my company, but training that will help you in your career? I’d definitely feel confident discussing issues and possible RER: I certainly tried to learn practical This solutions with the leader in my company. skills, mainly so I could make my own life easier while I’m working at my company; hands-on JS: I do, and I already apply lean to myself and my own work. concepts such as the 5Ss, the eight approach wastes and how to reduce them, along to lean was MC: I feel that I now have the knowledge required to with the five principles of lean to ensure much more start implementing lean back in company however I continuous flow. We learnt these skills interesting and feel it could be a difficult task as due to the fact that the with a challenge in which we were given a company I work for has no prior experience of lean and set of Lego airplanes and told to assemble engaging than I feel they could be rather set in there ways. them in as quick a time as possible. We a detached also had to devise the profit/loss of the presentation Do you think projects like this are factory while taking into consideration the ever could be a good way to encourage people overheads, worker wages and demand for to learn about lean? the planes. Then we sorted out each part RER: Yes, definitely; this hands-on approach to lean was and placed them onto shadow boards, much more interesting and engaging than a detached delegated tasks to each member to keep presentation ever could be, all the concepts we learnt in lead times down, and inputted all our theory were turned into reality with the practical, and we data into an excel to optimise our times made sure we knew exactly what we were doing to make for maximum profit and number of planes sure we beat the other team’s manufacturing techniques. produced per week. I managed to cram in a lot of information which I’ll be able to recall in each small step we took as a team in reducing JS: I am definitely more aware of waste in our manufacturing times for the Lego planes. the workplace; the 5S method is something I now find myself regularly referring to JS: Without a doubt, people my age have had very going about day to day tasks, for example limited, if not non-existent, exposure to production/ I can’t help but to return equipment engineering environments, the tasks we carried out immediately after use in an attempt to enable people to understand what not to do and what keep my workspace clear, it has other to look out for and understanding the reasons why. positive effects such as my co-workers no This will stop people from developing skills with bad longer bother me for tools they are missing habits such as working in untidy areas and not properly as they are always in their place. storing and sorting equipment, this will of course save themselves time and effort. In regards to practical skills I have learnt, I maintain a level of order to my tools MC: I believe projects like this are a great way for and work in a tidy and well organised people to get a basic understanding of lean even if it manner with only the tools I need. only affects the way that individual works.

www.leanmj.com | May 2015 31 lean online MAY 2015

ROUNDING UP THE LeaN MONTH’S DIGITAL COMMUNICATIONS nline ON LEAN

LMJ’s social media pages are a great place to go for TM Events Team lots of networking opportunities and information @TM_EventsTeam on all things lean from around the web. Hayward Tyler give us an in-depth look into their witness Find industry experts and exciting discussions on simulation model and the metrics it offers #TMLean our LinkedIn page, and follow @LeanMJournal and @AndrewPutwain for news on upcoming events and ways to get involved with the LMJ.

Here’s the best tweets and mentions of lean from the recent #TMLean manufacturing conference in Birmingham, where several alumni of LMJ gave their best ideas.

DAVINDER LOTAY @DavinderLotay Great problem solving exercise on engaging a “Passenger” on the Lean journey #TMLean

Howard Bettany @howardbettany1 @agataxch I was listening @TheManufacturer @AndrewPutwain great day

@agataxch @AndrewPutwain in full flow at the Lean Man conference today

32 LEAN ONLINE

TM Events Team @TM_EventsTeam Charles Bamford ...while in our other room Rob Armstrong from @SelexES gets delegates talking about @charlybamf employee disengagement! #TMLean Thought provoking presentation from @ParkerHannifin. I feel many in the room will be taking this further over lunch. #TMLean

Duncan Riley @duncanriley101 Understanding the needs of manufacturing businesses deploying lean @TheManufacturer @peratraining #TMLean

Remember to follow the LMJ on Cimlogic @Cimlogic LinkedIn and join the discussions @CimlogicFraser Speaking @TheManufacturer #TMLean Conference this morning! there: http://linkd.in/1vIt528 Maximising #ROI on #ITSystems for #CI

www.leanmj.com | May 2015 33 CASE STUDY Distilling lean

owmore whisky has been produced on the Scottish island of B Islay since 1779, and is one of the Distilling lean world’s most recognisable alcohol brands. Its superior standards have seen it become an icon of Scottish industry in terms of LMJ’s editor Andrew Putwain visits a Scotch whisky luxury products. producer where a wee dram of modernity is mixing with The firm’s main blending and bottling site centuries of tradition in the leanest of fashions. is in the Springburn area of Glasgow, just north of the bustle of the city centre.

MBD has been in situ since 1985, and READ ABOUT: has expanded to fill the site completely; needing to constantly re-jig its layout Bringing lean into a process steeped in history and pride to fit an ever increasingly diverse and complex range of products. From The changes that come with multi-nationals, mergers miniatures to a premium luxury range and how Morrison Bowmore (MBD) is adapting catering to the super wealthy, made How HARFORD data systems are helping the firm with hand-blown glass, and processed increase its efficiency in a special, locked department only accessible with express permission.

34 case study

The company’s six key areas of operational excellence: Craig Mochrie, a 30-plus year veteran of the company and on the floor. Impressively, nearly half safety, bottling manager at Springburn, showed us around and are women, showing how fully the highlighted lean’s benefit to the company. organisation takes its commitment to the productivity, future and a highly engaged workforce. cost, delivery, “People are one of our top priorities,” Craig said. “If you quality and look around you’ll see morale is high and that’s what we morale strive for.” Quick facts about Morrison Scottish and Irish (Whiskey with an E is across the Irish Bowmore: Sea. A touchy subject in this most hallowed of Scottish A rise in sales of 12% to £55.6m grounds) operations director Mick Ord agreed, stating for the year to December 2013 the company’s six key areas of operational excellence: Reported a 7% hike in profits to safety, productivity, cost, delivery, quality and morale. “But £9.1m in 2013. priority number one is definitely people,” he said. And Produces high-end Bowmore, when it comes to lean they are part of a global team and Auchentoshan, Glen Garioch and are all committed to learning. Ord added, “We share best McClelland’s single-malt whiskies. practices with our sister sites all over the world. So if our MBD bottling operations have colleagues in Spain, for example, have something to teach achieved in excess of 98% in us, we’ll go there, and vice versa.” customer service performance over the last 3 years Mochrie backs this up, showing how seriously Bowmore takes its lean journey that it started in 2006: “If you don’t have the culture, if you haven’t been through the Beam Suntory itself is lean and has used challenges of transition, then you don’t have lean.” the expertise of the CCI framework. Ord is positive about the recent transitions Morrison Bowmore recently became part of the newly though, and is looking to the future: “We formed Beam Suntory, the world’s third-largest premium are going through a transition rather than spirits company owned by Japan’s multi-national Suntory an integration. The tools and techniques Holdings. There’s about to be an influx of new people as it we use and have been taught are not merges with the Glasgow central office, adding to the 130 new,” but they have given good results. or so employees, around half of whom are on production Despite recent changes, one thing they are

www.leanmj.com | May 2015 35 CASE STUDY Distilling lean

all focused on is that lean is not possible without total engagement. Mentions of morale and people as priority are not just lip service. “You build from the bottom up,” Ord continues. “You have to get the foundations right.”

There is however plenty more to be done; they’re in a transitional period and want to increase additional volume capacity and incorporate more lean technology.

Down on the floor it’s an impressively streamed process; casks come in from a range of distilleries across Scotland and are ‘dumped’ of their contents. The most iconic aspect of whisky making and a

One thing they are all focused on is that lean is not possible without total engagement. Mentions of morale and people as priority are not just lip service

rich part of the heritage and something more effective asset care, improving flexibility and that is too precious to the history of the maintenance, and is now apparent all over the work floor industry (and indeed to Scotland) to allow with touch screens everywhere showing data of the lines. a machine to take over. It’s lean, with a quick turnaround time and where are The hold ups and breakdowns are presented in real all the problems are accounted for-but time, and the staff all follow the monitors around the it’s still the century’s old tradition with factory with diligence. The monitors showcase the a man, a funnel and cask full of charcoal percentage of orders completed, with section by section and strong booze (LMJ was given a taster analysis of the line and the timings that each segment and had no complaints). of completion takes.

Once that section is over it’s off to where The computers also give a host of statistical process the real action is, and Morrison Bowmore’s control information, which show the breakdowns, hold system controller for bottling, Jim ups and completion of orders. All valuable information to Donaldson, is keen to show the system has make sure all root cause analysis is available at the touch been data-mined to make it as efficient as of a button. possible. The factory has increased from 746k cases in 2006 to just over 1.2m cases Morrison Bowmore’s recent changes have proved in 2014, with a lot of help from HARFORD challenging, but the company is easily manoeuvring its total product maintenance system. way through the times with gusto and plans for more lean rollouts and developments. Mochrie is adamant they will HARFORD data capturing was part of the achieve further growth; “Our target is to be the number first stage launched in 2006, alongside one single malt specialists in the world.”

36 EVENT REVIEW

are regular, productive and enforced. They are the primary source of employee engagement and provide instant feedback TM Lean and handover information for the operators at this site which runs 24/7. The company has not actually named its systems of improvement as lean but is the Manufacturing same in almost every way. Second up was Bernard Auton, director of European operations for National Conference Instruments. His snappily titled presentation “CI @ NI” showcased the LMJ’s sister publication he theme of the conference was simple and effective ways this billion how to start or re-inspire lean in dollar company operates lean at its organised its annual Lean T the workforce and re-engage three sites (Hungary, Malaysia and Manufacturing conference with lean. This is one of the biggest Texas) making precise components for challenges in the industry. Everyone has measuring equipment used in some at the end of March, as part so much passion and enthusiasm in the of the world’s most technologically of its Future Factory series. beginning but within weeks-if not days- advanced scientific spaces. it can all evaporate as the true nature of Attended by a diverse range lean takesshape. You have to make a One of the first struggles for CI at NI of speakers and delegates, commitment; attitudes will be have to was simple: convincing the board to be modified and schedules, costs and put any money into the operations. eager to share their ideas hard work all have to be committed to. As part of its ideas on lean and CI they on best practice and Often, there’s a lot more work than what went the opposite way of CCE: instead is first considered. of embracing scheduled timed and strengthening corporate regimented meetings, NI tried to ditch and staff engagement in The opening presentation was Trevor meetings as much as possible as they were Stacey, operations manager from Coca unproductive and time wasting. continuous improvement. Cola Enterprise’s Sidcup factory, in South East London. His presentation was on One of the main ways NI made the use of production routines to drive improvements was one of the most continuous improvement. And if there’s simple: using small boxes to put on forms one thing we all learned about CCE it was for potential customers expressing interest this: they are really good at meetings. in a deal. Thousands were being lost in possible business connections as sales The meetings are strictly adhered to and and marketing teams were simply unable are audited by staff to make sure they to read the handwriting of those wanting

www.leanmj.com | May 2015 37 TM Lean Manufacturing Conference

their services. The solution? Installing small square boxes have found Fraser Thomson from Cimlogic on the forms which lead to better handwriting even when helpful. How was it going to use IT and they were allowed to write free form on later questions. MES systems to better lean?

So seven years into lean, NI have made great gains “Everyone wants to improve,” stated through a simple series of tweaks. Embracing coaching Thomson, “And 71% of manufacturers in house, and on two-four hour sessions as opposed to a spent more on IT in 2013 than they did whole day for staff, which they found tiring and boring. It in 2014.” It’s big business and in today’s proved that lean can be about combining ideas and small modern workplace you have to have IT practical details. systems that are functional and quick. The generational excuse, or “that’s the One of the day’s most lively presenters was Stuart way we’ve always done it.” Doesn’t cut Wood, of Oxford Instruments, a company based in it anymore. High Wycombe, just outside of London. Stuart, head of operational excellence at the scientific manufacturer, The main reason for lack of investment was the keynote speaker and was engaging in his however, is cost and lack of confidence in presentation on deploying and sustaining your lean ROI. “We need to bring systems together transformation programme. and share data.”

His ideas were all about behaviour. “Measure And then it was time for the day’s most drive behaviours, not performance. Measure pain interactive session. Howard Bettany and not performance.” The Agata Choma, lean mangers from Parker Hannifin, asked why do we need a culture The change entailed cultural architecture. Wood theme of the of CI? continued, saying, “You cannot ask staff what their issues conference are and then ignore it.” One of the first things Oxford was how to The first thing they wanted was to put Instruments did in the beginning of the year and half start or re- themselves out of a job: lean managers long LSS project was give its employees a survey on how and directors are a waste of time. It should engaged and happy they felt about their work place. The inspire lean in all be about the staff self-managing and results showed that less than 30% were satisfied with the workforce self-motivating. They want the programme their workplace. In the most recent survey, that’s gone up and re-engage to build up and inspire value steams and to over 70%-and more people now fill in and return the with lean. loyalty. And had one thing to say: it’s all forms too! about the coaching. “You cannot master This is one something without routine,” Bettany The change team are all volunteers from the workforce of the biggest stated, “It’s the routine to create a culture who saw the possibilities for improving their daily challenges in of problem solving.” worklife. The programme teaches managers their the industry primary job is to remove the barriers that stop the staff They believed that lean change was a from doing their job. body, and without all the requisite parts it couldn’t work. The key learning points “They come to work to do a job,” commented Wood, “and is the coaching loop is critical, barrier all we do is put those barriers in front of them.” removal through the layers and “it’s all about those teachable moments”. One of the keys is positive reinforcement; simple kaizens, JBI problems that you know you can fix. Bettany raised eyebrows with one simple, “People want to know they’re getting better, they want effective statement. “We all do lean to to measure their success.” make money.” So should it be customer focused or capability focused? Choma The firm uses three Ms: What does it mean to ME? What concluded, that whichever way you look does it mean to my MATES? What does it mean in terms at it, “Everything we do is linked. The more of MONEY? productive we are the better value we are for our customers.” If the staff see the benefits they will engage. If the managers see the staff are more productive they’ll feel the Paul Gore, operational excellence benefits in the bank balance. “Basically,” concluded Wood, specialist, from ThermoFisher Scientific, “we never want to see a problem come back.” took the company’s work as the processor of DNA kits for police, to heart with his Using IT to maximise the ROI (return of investment) of presentation; the DNA of leadership of and your manufacturing investment to drive CI? Then you will its opposition to lean thinking.

38 EVENT REVIEW

The Warrington-based firm of 110 and distrust and problems followed, even Dickinson’s story that his old employees had revenue problems and though, “the market was there. We just company used to reward suggestions provided fodder for anecdotes of how had to deliver on time.” proved a warning. “We don’t reward people don’t understand the issues of suggestions anymore. Only suggestions taking on lean. “There’s a difficulty of They turned around to save the that are completed and effective being a conduit between employees company and created a winning after implementation.” and leadership,” he mentioned as the mentality through staff engagement, plight of those in lean. Bosses who aren’t “The only way to get there is hard work.” “Respect, integrity, commitment and interested in lean, don’t understand the Clocherty pushed home. “We worked innovation”, are the keys to Entek’s problems, the processes or how or hard, worked fast, engaged people and change. “Our lean vision applies to why it should cost money. They want it removed road blocks.” everyone throughout the organisation. done now. TPM didn’t quite encapsulate what we Better communication, a more forward wanted so we created our own system. Gore commented, “Lean is about changing thinking and long term outlook and We wanted to be environmentally not maintaining the current status,” and simply pulling themselves up by their conscious and have health and safety needs to fight these bosses and educate laurels to do better. The routines at the forefront. We wanted to define them. Because, “lean leadership is everyone had got into weren’t working, what good looks like.” They also linked different from conventional practise”. so they had to go. As Clocherty reiterated: engagement of lean to bonuses. it was all about the hard work. In the afternoon the room split into two He further suggested a good lean sessions for problem solving. The first Jason Bridger, GlaxoSmithKline LSS journey needs to define the boundaries was about ditching the middle man. Rob champion, approached problem solving in and encourage and supporting teams Armstrong, industrial engineering manager a different way. The company hadn’t been to work on removing barriers. His of Selex ES, talked about “The passenger” in financial strife but has over 100,000 guaranteed ways of achieving lean employees spread around success: good leadership, good training, the globe and had to rewards and recognition. create a new department called core business The last presenter of the day was Kevin services to implement Thomas, the manufacturing manager of We all do lean to make its system of accelerated Carter Environmental Engineering and delivery processes. Franklin Hodge Industries who faced money.” So should it be customer terrible staff engagement when he focused or capability focused? The firm’s aim was to was brought on board. He looked at it create and embed a through an SME lens; which has its own performance driven challenges. “A large chunk of the business culture. It was able to community are SMEs which have nothing do this by not using lean else in common.” tools- an often derided and how to employ the unengaged and discussed concept through the day. The firm had 10% absences. But employee. Rob Atkinson, manufacturing Multiple people discussed if they were was able to turn its staff around by operations manager, of Donaldson EMEA necessary. Howard Bettany told us they managing the negatives, creating and embraced this theme with leadership and were all you needed and with them you demonstrating proof of lean, promoting challenging the sceptics. could achieve gains even when all else the positives, having a concrete strategy was missing. Bridger disagreed, insisting for implementation educating. As he Hayward Tyler’s manufacturing systems they achieved change through mindset. finished up for the day, Thomas provided director Martin Clocherty and colleague the ethos of the day in a nutshell: Oliver Buhlinger, showcased the firm’s Back in the main room the day’s second “nothing worthwhile is easy”. re-planning events. They had a £1m to last presentation was Brian Dickinson revamp of their plant; simple things like from battery pad manufacturer Entek. The points raised through the day were cleaning out scrap material, repainting, “You can have all the best plans for your varied. The importance of PDCA was cleaning the machines, all showed how business, but if you haven’t got the clear, but toolkits were often discussed. it reinvigorated a staff who had been culture, you won’t be successful.” A necessary step or something to be nothing but doom and gloom as the avoided? ERP systems-essential to company was on the rocks. Dickinson’s presentation also focused providing a modern, data-driven process on employee engagement. He had map and an easy way to see where The firm’s ailments were easy to point out: a surprisingly controversial idea: you’re going wrong. Or a waste of time “We never used the scheduling part of rewards and prizes for the staff. Often with limited ROI? And is incentivisation our ERP systems.” And orders were always very generous. Many thought this a poisoned chalice as a way of late. The departments blamed each other incentivisation was misguided. encouraging lean? SPECIAL FEATURE LESSONS FROM DEMMING Lessons from Deming: a brief history of quality- part three Bill Bellows presents the final part of his epic trilogy on the brief history of quality. Look out for a new column replacing Lessons from Deming in coming issues. his brief history of quality, would not be complete without sharing T a passage from Prophets in the dark, by David Kearns, the former CEO of Xerox:

In the late 1960s, Frank Pipp, an assembly plant manager for a Ford Motor Company factory, instructed his staff to purchase competitor’s cars. His plan was to have the final assembly team disassemble these cars and learn first-hand how they assembled. At that time in Ford, if two connecting parts could be With the earlier account by Larry Sullivan the DIYer in the garage, this time doing assembled without the use of a as a second reference point, consider home repair. handy rubber mallet, then these what happens when a craftsman works parts were known as “snap fit”. To on the design of a product at home, Imagine a piece of wood moulding is Pipp’s amazement, one car purchased where the customer and producer are needed to replace a damaged length of was 100% snap fit. He did not believe often one in the same. One person wood in between two existing pieces. We the results and instructed the team designs the product, procures the raw begin with a piece of moulding which is to repeat the assembly operation. material, fabricates the corresponding too long and needs to be cut to length. They did and found again that the parts, and then assembles them into In rapid order, the required length is Toyota pick-up truck was 100% snap the final product for personal use. The measured, and the piece is marked for fit. The time frame of this story was producer-as-customer is quick to judge cutting. As a next step, a saw is readied. the late 1960s and the discovery was the product quality and adjust the Consider how many lines one typically not lost on Pipp. In contrast, he noted design-procurement-fabrication-assembly would draw across the top face of the people from Ford’s corporate offices process, as needed, should the resultant wood before making the cut. That is, were invited to look over the truck product quality fall short of expectations. instead of using short marks to indicate themselves and witness the assembly where to place the saw, how many lines team’s discovery. According to Pipp; While the DIYer in the garage is not would be drawn across the top face to necessarily a master craftsman, the guide the placement of the saw blade Everyone was very quiet, until the connection to the model of a single during the cut? Most often the solution division general manager cleared his person engaged in most of the design- is to use a single line and subsequently throat and remarked, “The customer procurement-fabrication-assembly tasks cut close to this line. Why is the habit will never notice.” And then everyone is relevant to the topic of quality and not two lines, as in the standard industry excitedly nodded assent and an appreciation of the TPS and how it use of manufacturing tolerances with exclaimed, “Yeah, yeah, that’s right” differs from a mass production system. an acceptable range, in keeping with and they all trotted off happy.” As a personal example of craftsmanship, the practice of interchangeable parts? let’s return again to the example of The single line answer implies a belief

40 SPECIAL FEATURE there is a target length for this piece of Figure: Taguchi’s quality loss model reflects a continuous model of part quality. moulding and indicates a strong intuitive Histograms one and two are examples of possible results for two suppliers of parts. sense of knowing the piece of wood is “part of” something rather than merely a “part”. A “part of” perspective is likely 2 Taguchi’s model when engaged in a home improvement Quality project where connections are visible and loss immediate. In the moulding example, the (to a greater 1 Step- system) function lesser quality of the fit if the piece is longer model or shorter than desired will be obvious. Any effort required to adapt the moulding piece, because of variation in its length – a Lower Target Upper little too long or too short - represents specification (desired value specification quality loss, a concept introduced and limit of parameter) limit developed in Japan by Taguchi. suggested a model that looks at quality figure offers a side-by-side comparison from the vantage point of the relationship of these models. In keeping with a As shown in the figure, Taguchi’s quality of a producer to its customer. In doing so, step-function model, all parts within loss function model increases continuously Taguchi acknowledged the existence of the specification limits are good and as the piece of moulding length misses a never-ending connection (and impact) equally good. No change in quality is the target by larger and larger amounts between the provider of the part and what perceived across this range and the only in both directions – shorter or longer it is part of. The technical aspects of this changes in quality that do occur happen than the desired target dimension. In holistic model are shown in the figure, instantaneously at the transition across either case, the extra effort (loss to the where the horizontal axis represents either of the specification limits. Inspired DIYer) is both finite and real, just as the the specific value of a part dimension by Taguchi, and influenced by Deming, use of hammers to assemble parts at the on a continuum and the vertical axis Toyota has long modelled quality as a Ford plant were finite and real to Frank represents the associated quality loss for continuous feature, rather than discrete, Pipp and his assembly team. Could it be a corresponding part dimension. If one with a preferred value (target) that such losses are accounted for and then considers the quality loss to be the extra provides for minimal loss. Such a view reduced through routine efforts within effort required for installing a part of a leads to the conclusion any deviation from the TPS to better align the organisation’s given dimension, the distribution (quality a target dimension results in some degree resources? That is, the resources of time loss function) theorised by Taguchi - a of loss being imparted downstream by the and effort would be invested to produce a simple parabola centred on the target part after its shipment to the customer. given dimension closer to its target value, dimension (with minimum loss at target), but only if this effort was less than the accounts for the loss associated with Let me close with a strong promotion corresponding reduction in loss, thereby dimensions that are not produced to for the use of tolerances when the making the effort a worthwhile investment target dimensions. accumulated expense of the added efforts of resources. According to personal to manage variation around a target value conversations with Taguchi, Toyota has Taguchi’s model brings in to question the is not off-set by greater savings from been a world-wide leader in the use of mass production belief all parts within reducing losses to others, either within an his quality loss function concept to direct the range of the specification limits are organisation, or to external customers. In efforts to move from the traditional part equally good, and, therefore, absolutely these situations, we will continue to focus quality model of mass production to one interchangeable. The degree to which on the good parts and the bad parts. For in which a greater emphasis is placed variation from a target dimension situations where the financial impact of on what craftsman know as relationship produces harmful effects downstream quality losses are significantly more than quality, as in how far from the target value in the organisation and society is a the effort to manage variation around a is a given parameter? function of the steepness of the quality target value, we should either strive to loss function, which, in turn depends on achieve the beautiful prospects of lower According to Taguchi, Toyota’s efforts the specifics, or context, of the system loss (snap-fit) operations, or overlook with the quality loss function date back which the part is actually a part of. Of this option and fall victim to the ugly to his consultation role in the early 1950s. foremost importance, Taguchi’s model prospects of higher loss (rubber mallets) Within 10 years, he was honoured in suggests interchangeability be modelled as that inspired Frank Pipp into action upon Japan with a Deming Prize in Literature something relative and not absolute. discovering Toyota’s early progress in for his contributions to a new definition managing variation as a system, as would a of quality. Specifically, he defined quality By comparison to Taguchi’s model of craftsman. Could it be possible that Toyota as “the minimum of loss imparted to the continuous quality loss, the mathematical has married the quality insights of Deming society by a product after its shipment model associated with the mass and Taguchi and created a system of to a customer.” By contrast to the mass production concept of zero defects is a production which is being viewed by many production system’s conformance to step-function, as referenced in the fizzy through the lens of mass production using requirements model of quality, Taguchi drink exercise, earlier in this series. The interchangeable parts?

www.leanmj.com | May 2015 41 events

There is currently an expanding pool of events available for the development of the lean community. They offer both general and sector specific opportunities to renew your enthusiasm and gain new perspectives through communicating with lean contemporaries. UPCOMING LEAN events include : DATE FOR YOUR DIARY: Lean Healthcare International Transformation Lean Summit Summit June 10- 11, 2015, Budapest, Hungary June 3-4, Dallas, Texas, USA Lean Enterprise Institute Hungary The lean healthcare community gathers is organising its International Lean again in 2015 for two days of learning, Summit for the fourth time since LMJAC 2015 sharing and connecting. Dallas, Texas has its foundation. Dave Brunt and July 8-9, 2015, Amsterdam, The been selected as the host city for this year’s Tilo Schwartz will be the keynote Netherlands Lean Healthcare Transformation Summit. speaker at the event in June.

The Lean Management The Lean Healthcare Transformation For more information please visit: Journal Annual Conference is Summit is designed to help transform http://bit.ly/1CzpqHm rapidly approaching. the healthcare industry through collaboration, education, and International This year’s European-based experiments. The Summit is presented Lean Management conference will widen the annually by the ThedaCare Center for Conference boundaries of lean to all sectors; Healthcare Value in partnership with June 16-18, 2015, Wroclaw, Poland including legal, banking, finance, the Lean Enterprise Institute. These The Lean Institute Polska presents insurance and accounting, organisations work together to provide this year’s International Lean manufacturing, healthcare and participants a unique combination Management Conference. public sectors. of actionable ideas and networking connections in order to accelerate their This year will have more than LMJAC will include presentations own lean transformation. They also 400 participants and some of the on How do you create a culture present innovative examples of care world’s best lean practitioners and of lean advocates? And Running delivery redesign supported by results, experts, inspiring case studies, a project in-house Vs engaging examples of payment systems that workshops and factory visits. outside expertise reward patient value creation, Speakers include John Shook, Chris and examples of transparency Vogel, Mike Orzen, Samuel Obara Contact events@hennikgroup. of performance. and José Ferro. com for more information on the essential lean event of 2015. For more information please visit: For more information please visit: http://bit.ly/1JkAVFn http://bit.ly/1JlCWoy

AME/CME Canadian Lean Conference 2015 June 1- 4, Winnipeg, Manitoba, Canada The Association for Manufacturing Excellence (AME) is the premier organisation for education and networking in the manufacturing profession. Members come together to explore lean thinking, enterprise improvement methods, exchange best practices and network. AME has partnered with Canadian Manufacturers & Exporters (CME), Canada’s leading trade and industry association, to deliver a world-class national lean conference

Conference attendees will experience six highly acclaimed lean experts and motivational keynote speakers, they can choose from 36 best practice practitioner presentations organised around four value streams.

There will also be over 18 tours to see hands-on application of lean techniques in action and 15 highly interactive workshops.

For more information please visit: http://bit.ly/1AIdGmS Photo courtesy of Sebastiaan ter Burg on flickr

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