1
., Assessing the Percentage of Business and Industry Utilizing Lean
Strategies Where University of Wisconsin-Stout
Graduates are Employed
By
Thomas Harvey
A Research Paper Submitted in P31iial Fulfillment of the Requirements for the Master of Science Degree III
Training and Development
Approved: 4 Semester Credits
J ames Keyes, PhD
The Graduate School University of Wisconsin-Stout August 2010 2
The Graduate School University of Wisconsin-Stout Menomonie, WI
Author: Harvey, Thomas K. Title: Assessing the Percentage of Business and Industry Utilizing Lean Strategies Where University of Wisconsin-Stout Graduates are Employed Graduate Degree/ Major: MS Training and Development
Research Adviser: James Keyes, Ph.D.
MonthlYear: August 2010
Number of Pages: 61
Style Manual Used: American Psychological Association, 6th edition
Abstract
Lean manufacturing or lean production is an organizational approach to process management, known simply as lean. Lean focuses on the removal of any aspect of a process not intended to bring about greater customer satisfaction and product value. The purpose of this study was to determine the percentage of businesses and industries utilizing lean, as an operational strategy, where University of Wisconsin-Stout graduates were employed. The aim was to understand the increase in the number of student enrollments in lean related courses offered by the College of Operations and Management at the University of Wisconsin-Stout.
Quantitative data was gathered by a research-based survey sent to 425 Bachelor of
Science graduates from the University of Wisconsin-Stout (Stout). The three majors targeted in the study were Business, Business Administration and Engineering Technology; pat1icipants graduated between 1995 and 2008. Responses were returned from 20% of p311ici pants. 3
The results of the survey indicated lean strategies are used widely by business and industries where Stout graduates are employed. Almost half, 48%, of respondent's report that their current employer utilizes lean methods within their organization. Of those reporting to use lean, 52% reported the use of lean throughout the entire organization, with 29% repOliing the use of the lean in production/operations side of the organization.
The increase in the number of students enrolling in lean-based operations and business classes appears to be based on the wide implementation of lean strategies across a range of business and industries. The University of Wisconsin-Stout may continue to see a continued demand for the knowledge, skills and abilities based centered on the principles of lean production. 4
The Graduate School
University of Wisconsin Stout
Menomonie, WI
Acknowl edgments
I would like to acknowledge and thank all of my instructors that I have encountered in my pursuit of my degrees. My goal would not be possible without the help and suppoli of the home unit, thanks to you both. 5
Table of Contents
...... Page
Abstract ...... 2
List of Tables ...... 7
List of Figures ...... 8
Chapter I: Introduction ...... 9
Statement of the Problem ...... 9
Purpose of the Study ...... 10
Assumptions of the Study ...... 10
Definition of Tenns ...... 10
Limitations of the Study ...... 12
Methodology ...... 12
Chapter II : Literature Review ...... 14
Lean Manufacturing-An Overview ...... 14
Benchmarking ...... 16
Just in Time ...... 17
Six Sigma ...... 19
Lean Six Sigma ...... 21
Theory of Constraints ...... 24
Chapter III: Methodology ...... 27
Subject Selection and Description ...... 27
Instrumentation ...... 27
Data Collection Procedures ...... 28 6
Data Analysis ...... 29
Limitations ...... 30
Summary ...... 30
Chapter IV: Results ...... 31
Data Analysis ...... 31
Organizations where Lean is utilized ...... 33
When Lean is not utilized ...... 37
A Look at University of Wisconsin-Stout Graduates ...... 39
Chapter V: Discussion ...... 41
Limitations ...... 41
Conclusions ...... 41
Recommendations ...... 42
References ...... 45
Appendix A: Survey Invitation ...... 48
Appendix B: IRB Exemption ...... 49
Appendix C: Survey Results ...... 50 7
List of Tables
Table] : Select the business or industry that best describes your organization...... 3]
Table 2: How many people are in your organization? ...... 32
Table 3: Within your organization, where do you employ lean? ...... 34
Table 4: How long has your organization used lean? ...... 34
Table 5: Lean has given our organization a return on our investment in it ...... 35
Table 6: In what way could or should UW Stout be preparing graduates to utilize lean in
industry ...... 40 8
List of Figures
Figure 1: Do you cunently use lean as your operational strategy? ...... 33
Figure 2: Select the benefits your organization has realized in its use of Lean ...... 37
Figure 3: Reasons an organization may not use Lean ...... 39 9
Chapter I: Introduction
Today's businesses are facing a competitive global marketplace. While many books and articles have been written regarding lean as an operational and process management strategy, little information exists on the number of organizations in business and industry utilizing lean at the time of this study. However, lean is not the only operational strategy currently in use in business and industry; competing with lean is: Six Sigma, Theory of Constraints, Lean Six
Sigma, Just in Time. Process management, as defined by the book of the same name (Becker,
Kugeler and Rosemann, 2003) is a method of planning and measuring outputs of a process in business or manufacturing. Organizations across sectors and scales of business and industry see a managed process as a way to increased profitability. Not all organizations employ an operational or process management strategy; some organizations have even moved away from lean in recent times in favor of a more agile approach to manufacturing (James, 2005). The research was conducted to ascertain the number of businesses and organizations using lean where graduates of the University of Wisconsin-Stout are cUlTently employed specifically.
Statement of the Problem
The University of Wisconsin-Stout programs in Business, Business Administration and
Engineering Technology has experienced an increase in the demand for courses based in lean theory and practice. This study was conducted in an attempt to understand the demand for lean courses and to project if the need would continue. Little data exists as to the percentage of organizations utilizing lean practices in 2010 or what operational or process management strategy is in place where University of Wisconsin-Stout graduates gained employment. 10
Purpose of the Study
The intention of this study was to determine if the Business, Business Administration and
Engineering Technology programs at the University of Wisconsin-Stout should continue to meet the demands of the students seeking course work relating to lean methodologies. Furthermore, the study will conclude if a change is needed to increase the number of classes and coops offered to students of these programs.
Assumptions of the Study
The assumptions of this study are:
1. Not all respondents will know their current employers organizational or
operational strategy.
2. Not all invitees will participate in the study.
3. Not all contact information provided to the researcher may be up to date and
accurate.
Definition of Terms
Benchmarking. A continuous, systematic process for evaluating the products, services and work processes of an organization recognized as representing the best practices in organizational improvement (Spendolini, 1992).
Just In Time (lIT). A system of planning for a manufacturing process that optimizes the scheduling of materials to alTive at the manufacturer when needed and in only quantities req uired for meeting the objective (Hirano & Makota, 2006).
Lean. Lean manufacturing or lean production is an organizational approach to process management. Lean focuses on the removal of any aspect of a process not intended to bring about greater customer satisfaction and product value. (Endsley, Maghill, and Godfrey, 2006). 11
Lean Six Sigma. Is a relatively new process improvement method that combines both lean and Six Sigma methodologies. It began in the late 1990s as companies began cross-training employees in the two frameworks and combined aspects of each operational strategy (George,
Rowlands & Kastle, 2004).
Original Equipment Manufactures. (OEM) Is a manufacturer or producer of a finished product; generally the last manufacturer before the end-user purchases the product (Womack,
Jones, & Roos, 1990).
Process Management. The application of the Imowledge, skills, techniques of an organizations to define, visualize, measure, control, report and improve processes with the goal to meet customer requirements with profit (Thorn, 2009).
Theory of Constraints. An approach to continuous improvement (reducing operating expenses and inventory and increasing output) based on a five-step procedure: (1) identifying constraints, (2) exploiting the binding constraints, (3) subordinating everything else to the decisions made in the second step, (4) increasing capacity of the binding constraints, and (5) repeating the process when new binding constraints are identified. It seeks to identify a company's constraints or bottlenecks and exploit them so that tlu'oughput is maximized and inventories and operating costs are minimized. (Goldratt, 1984)
Total Quality Management (TQM) This management strategy employs all facets of an organization (design, engineering, production, marketing, and finance) in order to meet their business objectives and meet customer expectations by minimizing production errors, streamlining the supply chain, utilizing modern equipment and training employees (Aguayo,
1991 ). 12
Six Sigma. Developed by Motorola, this management strategy seeks to reduce the
OCCUITence of error and variability through data analysis (Motorola University, 2010).
Value. Is a determination of the worth of a product or service that is assessed by the customer (Womack, Jones, & Roos, 1990).
Limitations of the Study
1. The subjects of this study are limited the undergraduates of the University of
Wisconsin-Stout programs in Business, Business Administration and Engineering
Technology from the years running consecutively from 1995 to 2009.
2. The participation is voluntary by respondents.
3. Respondent has to know of the operational strategies of their employer, past and
present.
4. Recommendations are for the University of Wisconsin-Stout, it's programs,
Business, Business Administration and Engineering Technology and the College
of Operations and Management.
5. The findings in this studying are not predicted to be valid after 5 years.
Methodology
A web-based anonymous survey was selected to pursue this inquiry. An invitation to pmiicipate was sent to all UW -Stout graduates drawn from a spectrum of undergraduate and graduate programs in Business, Business Administration and Engineering Technology at the
University of Wisconsin-Stout. Targeted business and industry graduates were: distribution, food production, and hospitality/tourism, manufacturing, medical, and retail. 13
A return rate of20% was realized on theon-line survey sent out to 425 graduates of the
University of Wisconsin-Stout programs Business, Business Administration and Engineering
Technology. The selected graduates were from the 1995 to 2009. All invitees were provided the
0ppOliunity to withdraw from the survey at any time.
Approval for this research was sought from the Institutional Review Board (lRB) at the
University of Wisconsin-Stout, which granted an exemption for this research. The survey and data were compiled with the help and technical assistance from the Applied Research Center located at the University of Wisconsin-Stout. 14
Chapter II: Literature Review
Lean Manufacturing-An Overview
The intention of this study was to asceliain the number of employers in business and
industry utilizing lean as a strategy where University of Wisconsin-Stout graduates were
cUlTently employed. Lean manufacturing was a process developed by Toyota Production System
and the early influence of Dr. W. Edwards Deming, a renowned American statistician; Deming
worked along side the Japanese during their post-war industrial growth (Aguayo, 1991). Deming,
founder of Total Quality Management (TQM) (Dobyns, 1990), promoted the concepts of quality
through the reductions of flaws inherent in the process of manufacture of a product, streamlining
the supply chain as well as modernizing equipment and training employees to the highest degree
possible. Later in life Deming stated that, in issues effecting quality, 96% of the problems were
in the work system and 4% attributed to the individual worker (George, Rowlands & Kastle,
2004). Deming did not work alone to develop quality improvement methods while in Japan;
Taiichi Ohno, Shigeo Shingo and Eiji Toyoda worked to continually develop Deming's concept
into a process at Toyota, from the years 1948-75 (Emiliani, Stec, Grasso, & Stodder, J., 2007).
The lean manufacturing concept began within the Toyota Production System in Japan and
was both investigated and documented in the seminal work of James Womack, Daniel Jones and
Daniel Roos (1990). Womack, Jones & Roos gave credit to follow researcher John Krafcik for
coining the term lean as early as 1988 (Krafcik, 1988). There was an apparent need for lean, in
the large scale, original equipment manufactures (OEM) of the world as explained by Womack
(1990) the author of The Machine That Changed the World, was in outgrowth of organizational
expectations placed on modern mass production. No longer was the individual craftsperson able
to produce their quality goods at a competitive price most consumers can afford, a result of the 15 industrial revolution. While mass-producers can produce mass goods manufactured at a price consumers can afford, there are both wastes and variations in product quality associated with minimally skilled workers running complex and expensive machinery. To meet the demands of the consumer in the post-industrial era OEM utilized resources that, by today' s standards, were wasteful. The extra employees, extra material and replacement parts on-hand needed to keep up production are all examples of waste; the craftsperson did not have to contend with such overhead as pali of their production methods. Lean production/manufacturing is as simple as getting the right things to the right place, at the right time and in the right quantity to achieve the perfect work flow. Nothing more and nothing less is needed or warranted in this production model. This philosophy changed the way business and industry chased profit.
Lean manufacturing offers a dynamic work environment that is too restrictive operates under severe limitations or prescriptive constraints. Womack, Jones & Roos gave the example of one Japanese automaker, Toyota, which had the flexibility to offer more automotive products in the marketplace than did the big 3 auto makers of Detroit during the same period in time. Toyota was capable of producing the feat with half the labor effort and they did it in half the production time it would have taken General Motors (GM) to do the same. They achieved this benchmark by consistently evaluating the process constructing their system of production. Toyota also changed the way a worker viewed the down time of retooling a machine. At one time a worker would enjoy the long work delay associated setting up to run a different product on the production line. A worker may have considered this retooling as pali of business and the company absorbs the loss resulting from such an event. Toyota convinced their workers it was to everyone's mutual benefit (increase in productivity and wage) to change a retooling process that 16 was measured in the number of hours, to a process that took only minutes to produce the same outcome.
While this production method is spreading around the world and into a variety of industries, Womack and Jones (1996) asserted in order to make the transition to lean and to capitalize on what lean could do for an organization is dependent on a committed workforce.
With lean workers need different skills; workers are now sharing what is known about their work and adding the to the process of production. Information is shared across the organization not just up and down as traditionally held organization operates. This meant workers were more challenged on the job; they have become more productive, perhaps even stressed about their work. Less individual pursuit and more collaborative engagement across the organization was the new norm. Professional skills will be needed along with creativity and problem solving skills.
Thinking became more important than doing as one conceptualizes their newfound responsibilities within the organization. Teamwork was central across sectors of in organization; ad hoc groups are formed as needed to service specific ends.
While it is important to have a complete understanding of ones own organizational capacity, the concept of how well one organization does inside their own sector of business and industry is critical for a high performing organization. A systematic process for evaluating the products, services and work processes of an organization, recognized as representing the best practices, expands the knowledge of how efficiently one's operations are truly running. This barometer is known in manufacturing as benchmarking.
Benchmarking According to Spendolini (1992) the utilization of metrics, within the areas of product design and development, cycle time, production time, material handling, overhead costs and 17 finally the retail prices, allows an organization to rank itself with similar organizations within an industry, when compared to others in the same industry. Once the common and comparative practices are identified and compared from one organization to another, especially an innovator or a leader with in the industry, an organization can indentify the areas within their own organization they need to change in order to become more efficient (and competitive) in their operations. Additionally, benchmarking is used to establish criteria in which an organization can also measure itself for use in the future or in comparison of the effolis past. Lean is often a viable operational and process management strategy to achieve and evaluate industry-leading benchmarks. However, lean methodologies have direct competition as an operational strategy in business and industry around the world setting or challenging existing benchmarks with differing approaches to process management.
Just in Time As early as 1934 the principles of Just in Time (lIT) emerged as Sakichi Toyoda moved from textiles into automobile and then truck production (Ohno, 1988). As an earlier operational strategy of Toyotas Total Production System, "The goal is to provide the right information, to the right people, at the right time-just in time so they can take action based on that information
(Kerschberg and Jeong, 2005)." This key tenant of JIT is seen in the lean philosophy the production methods of today.
Under ideal operational conditions for Just in Time, a company would have just enough production material on the floor, on a single day to produce the given number of units set for production for that day. Additionally, any product manufactured that day would be shipped immediately. Any material aITiving could be queued for immediate use. Thus we observe a cycle of planned management where needs are forecasted and production follows. While this ideal was 18 rarely obtained, organizations have realized a return on investment in the application of these principles. Inventory is seen as waste; it represents tied-up capital, which could be utilized to greater effect if it were not sitting on a shelf. Idol machinery and over staffing human capital were seen as equally inefficient.
These ideal principles are achieved by commanding the inventory control process and production, with the foresight of anticipating consumer demand for the product. However, reducing unneeded inventory and simply controlling total outputs does not address or reflect the
Demming view of quality improvement. With lIT, the most likely oPPOltunity to improve on the customer delight of the product is on-time delivery; early delivery of the product or service offered to the customer is the extent of the potential improvement in this process management approach.
lIT can be administered on management levels where buy-in for the entire organization is not necessary, depending on the long term strategic planning of the organization. lIT does require commitment from the top of an organization it does not require a workforce trained in applying a celtain prescribed process to each task or duty. For Ohno (1988) the belief was quality was sure to improve, considering there is just enough material to produce what is needed and the worker would strive to get it right the first time knowing resources were limited in availability. This had the potential of putting an undue stress on the line worker to reach this goal, unaided by improvements within the system. Oil production and refinement are examples in the influence of lIT principles appear to work will for an industry (Bongiorni 2004). The downfall of this philosophy may be in the dependence of suppliers of material. In 1992 General
Motor's attempt at lIT was hampered by a railroad strike, which left idled a 70,000 workforce. 19
This vulnerable aspect of JIT, coupled with the fact that it may be hard to determine future demand of a product made it largely ineffective for wide application in business and industry.
Six Sigma Six Sigma was developed at Motorola USA in 1981 (Telmant, 2001) as a methodology to improve the quality of outputs by reducing the cause of defects and variations of products in their manufacturing and business operations. This approach developed as a result of Motorola's loss of television-set market share to the superior Japanese television manufacturer. Much like
Deming's statistically based TQM (Stamatis, 2004), Motorola's production methods are statistically founded as well. One Sigma, as it is known in manufacturing, is a yield of 31 % in defect-free products; Motorola's Six Sigma strives to meet an impressive 99.9966% defect-free production goal. In every day terms it means this: 3.4 defects are found in one million customer requested products (Long, 2010). For example, of the 3.2 million prescriptions written for patients in the U.S. each year (Caplan, 2007), 7,000 deaths occur as a result of unreadable or illegible writing on the part of the person writing the prescriptions. Here we can see numbers do matter, the move to improvement has to be made and a sound process was needed to reduce operational errors in areas other than manufacturing.
While an accuracy rate of99.999978% is laudable for many industries and businesses, it is not accurate enough in the medical field. There is no significant statistical difference in these elTor percentages year after year; this is an on going issue with the medical industry. The point here is that numbers are not the only metric to measure customer satisfaction or safety. There are times in which business and industry has to move beyond the numbers. To this end Motorola has moved Six Sigma into 3 levels of their organization (Motorola University, 2010), as a metric, as a methodology, and as a management system. 20
Six Sigma is more than a method of removing flaws often inherent in the manufacturing process and thus the product. For Six Sigma companies the potential for process improvement needs to be included in every business practice, including those jobs that are considered non revenue producing. Six Sigma has been applied to business practices that appear to be unconventional, such as properly filed paperwork, customer complaints, and even effectiveness of solvents used in manufacturing to cleaning the corporate offices. Once indices and metrics are developed they could be applied in broad application.
As quality management methods stand, Six Sigma shares the need for organization wide buy-in, which is lead and supported by top management. FUliher, an organization will have processes for business and manufacturing that are documented; they can be measured, analyzed, improved shared, and even benchmarked. However, what sets Six Sigma apart from other methodologies is the way in which leadership supports this philosophy, considering the (often high) up front costs, the need to produce measureable and quantifiable financial retUl11 for a Six
Sigma project, use of ranked participants as change agents and finally the likelihood that decisions will be based on data sets; to the exclusion of other information. This very prescriptive approach requires an understanding of a statistical understanding to accountability; this is not an approach, which lead to a quick financial retUl11 on problem solving. Further, to implement Six
Sigma an organization will either have to develop a belt-canying Six Sigma expert or obtain this knowledge base from outside the organization. Most organizations do not have the resources or the sustained 10ng-telID vision to accomplish this complex feat. However, this may be changing as Six Sigma can now be seen expanding into sectors of business and industry where Six Sigma application is an emerging trend (Edgeman & Dugan, 2008).
In the work titled, "Six Sigma from products to people to pollution," Edgeman and 21
Dugan (2008) assert the day has arrived for the Six Sigma concepts to move beyond the walls of
OEM's and into arenas that may not seem to fit the Six Sigma customer profile. While the widely accepted approach of Define-Measure-Analyze-Improve-Control (DMAIC) or Design for
Six Sigma (DFSS) inherent to Six Sigma are similar to Deming's Plan-Do-Study-Act, they are now taking on ethical issues in their application outside of manufacturing. Although historically aligned to profit, the DFSS of Six Sigma may help in the advancement of genetic engineering, for example, but what if prolonged life leads a company to payout benefits longer than they may have before a certain discovery is made and implemented? This conundrum seems to be in opposition of the fundamental assumption that statistics always provides the answer.
While Six Sigma has improved the situation of the recipients of such a discovery it may not help the bottom line of the healthcare business applying this methodology, a double-edged sword if you will. This may explain the need for an operations methodology where the statistics are not weighed as heavily in consideration of the organizations objectives. While Six Sigma has a focus on reducing variations on the production of a product and service through process management, for some organizations more is needed on the organizational level.
Lean Six Sigma Six Sigma is not a process management approach that fits for all organizations. In an effort to seek out a viable process improvement method, which fits the strategic objectives of an organization, a combination of both lean and Six Sigma methodologies have been combined in what is known as Lean Six Sigma. What qualifies Lean Six Sigma as a process improvement method is the fact customer delight is seen as the preeminent goal. Statistical data is used to identify and eliminate problems inherent in the production process and leadership and employees have to buy into the philosophy. (George, Rowlands and Kastle, 2004). Lean Six 22
Sigma combines production objectives and customer satisfaction into one process.
The four critical elements in Lean Six Sigma are not significantly different than lean or in
Six Sigma. Process improvement, when evaluated shares many common attributes. Customer delight, improvement to the processes, teamwork of individuals based in different departments through out the organization, and their decisions that are data-based, and leadership at the top of the organization in support of the methodology (George, Rowlands & Kastle) are foundations to the Lean Six Sigma philosophy.
Today's consumers are under siege with the amount of products and services offered from the global marketplace. No longer does Motorola just a cell phone to consumers, they offer
117 models in their attempt to prove they understand customer delight (Motorola University).
Gone are the days were business produced just what an engineer recommended, or what the boss wanted to see and when the boss wanted to see it. Customers have the ability to shop in the international marketplace, the Internet, and select the product at the price where they find consumer value resides as they define it. Lean Six Sigma ensures that the first question that is asked is asked in the customer's behalf. The manufacture has to consider the "Voice of the
Consumer" (VOC) when operating in today's highly competitive business environment. Defects no longer have to be tolerated; this is a different than the time were at the time when only 1 or 2
OEM's of a product served the world.
Determining what is a defect and how to reliably measure them is an impOliant step for any provider of goods or of a service. For one business it may be helpful service, for others it may be timely shipping of a product that delights the customer. Each organization needs to understand how the customer expectations have a perception on value. Value is impOliant for the customer, not just during improvement projects but at all times that the goods and services are 23 out in the public domain. Organizations utilizing Lean Six Sigma try to uphold this concept as a key premise to their operations. Once an organization gains an understanding of the customer they then have to evaluate their process to meet the covenanted customer delight benchmark.
Trial and error are no longer the accepted approach to process improvement. Customer expectations are often too high for a new product or technology; they want it to work right the moment it comes off the shelf. Reducing variations or defects in the products or services is the key tenant in the Six Sigma approach. In their book "What is Six Sigma," George, Rowlands, and Kastle (2004) offer a case study (p. 27) as an example of the lean attributes to demonstrate how the 2 are tied together. Six surgeons were performing similar bypass surgeries; each requested a surgical tray that reflected their own approach to surgery. That required six different trays prepared for six different surgeons. By assembling all the surgeons in one room the topic was explored as to why each surgeon a distinctly different set of tools for the same procedure. As the surgeons reflected on this question it was evident there was a methodology to examine their various needs. Considering the fact there was statistical evidence that proved there was a benefit to the patients in having 6 different surgical trays the doctors agreed to a standardized surgical tray. By applying these tools, reduction in the variation of services offered (Six Sigma) along with the process thinking (lean), Stanford hospital was able to reduce costs $25 million and at the same time reduced mortality from 7.1 % down to 3.7% in the cardio depaJ1ment.
This example demonstrates that Six Sigma requires skill sets in two different abilities to implement this methodology. First is the statistical analysis of all the aspects of the business that can be identified and measured, The second skill set needed is the ability evaluate the process and the work flow of an organization. The change agents needed to bring this about are trained in the same manner as Six Sigma; green belts are the lower level where information is generally 24
collected and analyzed. The black belt has the responsibility for the project overall. These certifications are earned tlu'ough a comprehensive training program which may be offered in-
house, by outside consultants and finally, at colleges and universities.
Theory of Constraints As lean has emerged as a product Toyota Production System, the Theory of Constraints
(TOC) evolved out of the previous work of Eliyahu Goldratt PhD. Optimized Production
Technology was an attempt by Goldratt to address the needs of industry and an attempt to
enlarge the production capacity of any manufacturer tlu'ough a process reliant on his software
application. Disappointed by the fact his idea never came into fruition Goldratt followed up his
software with a book entitled Goal (Goldratt & Cox, 1986), which explored the idea of
constraints and bottlenecks; a constraint is anything that prevents a producer from reaching their
capacity. A "bottle neck is any resource whose capacity is equal to or less than the demand
placed upon it. The maximum speed at which a producer can manufacture goods is related to the
slowest operation within the system. A non-bottleneck is any resource whose capacity is greater
than the demand placed on it " (Goldratt & Cox, p. 139). When considering the capacity of a
manufacturer to produce their product Goldratt evaluates tlu'ee areas he believes effects
production. The first is tlu'oughput, this is seen as a goal in the number of units to produce or the
money generated from producing these units; secondary is the operating expense. This category
looks at how much money it will cost to produce given the number of units. And finally,
inventory is the money the company has to invest in order to meet the tlu·oughput. In order the
measure these 3 areas consistently Goldratt has developed 5 steps to evaluate any given
production process (page 301):
Step 1. Identify the system's bottlenecks. 25
Step 2 Decide how to exploit the bottlenecks.
Step 3 Subordinate everything else to the above decision.
Step 4 Elevate the systems bottlenecks.
Step 5 If, in a previous step, a bottleneck has been broken go back to step 1.
There is not a limit, minimum or maximum to the number of constraints an organization can face. These constraints may be internal, not being able to meet the demand of the consumer; it may be external as well. An example of external constraint is when production exceeds consumption. Goldratt has updated his earlier work and now includes the notion of a Thinking
Process as a way to not only manage a production process but also manage the system. With this updated model Goldratt asserts the real power to effectively and efficiently bring about change within an organization are (Goldratt Institute, 2009 p.9):
• Understanding the interdependencies between and across processes that contribute to
delivering a product or service,
• Understanding the impact that those interdependencies and normal variability have on
their cOlnbined, overall performance, and
• Appropriately buffering for interdependencies and normal variability so that that
performance can be predictably and consistently high.
The TOe Thinking Processes utilizes logic trees to provide a plan for change. The process guides the organization through the decision making of problem structuring, problem identification, solution building, and identification of bottlenecks to overcome, and finally the implementation of the solution. Goldratt claims once organizational leadership adopts his 26 methodology the producer will be able to address any sudden shift in the marketplace (Goldratt
Institute). However, this operational strategy appears limited in both scope and metrics when compared to lean, Six Sigma and Lean Six Sigma methodologies. It appears to focus on a few individuals within an organization having the vision and values to affect the outputs of the organization. This approach cannot be seen as needing organization wide by in. In the three operational and quality improvement methods already explored in this work TOC does not have the holistic vision lean or Six Sigma produce for an organization. TOC does not address the value-added process to ensure customer delight many of today's OEM's believe is necessary in the increasingly global marketplace.
The theories behind the concept of bottlenecks are not a product of Eliyahu Goldratt alone. The idea in which production will only be as strong as the weakest link of the supply chain/operations was explored greatly in the Just in Time operational philosophy (Olmo).
It is clear from the literature reviewed for this research lean offers the best balance of
supply chain logistics, production methodology and overall operational strategy of all the process management philosophies in existence today. It can be a holistic approach for an organization to reduce what is not need to bring delight to the customer. Lean has also displayed the ability to move beyond serving the OEM's of the world. Furthetlliore, Gary Conner, author of Lean for the
small shop, (2001) makes the case for the use oflean; it is time to expand the limits of lean to just OEM's. The practices are scalable to the smallest shops, offices and the small businesses in
America today. 27
Chapter III: Methodology
Research was conducted to asceliain the number and scope of businesses and organizations utilizing lean where graduates of the University of Wisconsin-Stout (UW Stout) are currently employed. A convenience survey was conducted with graduates of the Business,
Business Administration and Engineering Technology programs from the years 1995 through
2009. The research for this study was to determine if the Business, Business Administration and
Engineering Technology programs at the UW Stout should expand their capacity to offer lean methodology related courses. This chapter will describe how subjects selection and description, the method of constructing the instrument, the data collection procedures, how the data was analyzed and finally, the limitations of this research.
Subject Selection and Description
To investigate the number of businesses and organizations practicing in lean concepts a sample group for a qualitative study was drawn from graduates holding a Bachelor of Science degree from the University of Wisconsin-Stout. The subjects in this research graduated in the years 1995 to 2009 from the Business, Business Administration and Engineering Technology programs within the College of Operations and Management at the university. This population of undergraduates had the opportunity to enroll in process improvement related course work while attending the University of Wisconsin-Stout.
Instrumentation
The anonymous survey constructed for this research was developed following the discovery in the lack of a reliable data on the number of business and organizations utilizing lean practices. A need to investigate trends relating to lean was also apparent as the investigation for the construction of the instrument took place. The instrument was designed to identify 28 organizations inside and outside of traditional OEM's employing lean principles. To effectively utilize the data for future purposes it was critical to identify: which sectors of the economy use lean, the number of people within the organization, where within an organization a process improvement methods were utilized, and how long was the method in place. It was also impOltant to research process improvement methods in place before an organization moved to lean or away from lean practices. It was also important for the respondent of the survey to convey their understanding of why lean may work for their organization as well as why lean may not work for an organization. Equally impoltant was to understand why an organization would move to adopt lean principles and what would keep an organization from implementing lean.
This study has been reviewed and the project is exempt under Category 2 of the Federal
Exempt Guidelines by The University of Wisconsin-Stout's Institutional Review Board ORB)
(Appendix B). The IRB has determined this study meets the ethical obligations required by federal law and University of Wisconsin-Stout policies, IRB approval was sought to protect and preserve the rights of the participants. All personal contact infOlmation was deposed at the conclusion of the data collection.
Data Collection Procedures
An email was sent to 425 University of Wisconsin-Stout graduates inviting them to participate the 18 question qualitative survey. One week later a reminder to paIticipant in the survey was dispatched to the entire group. Participation in this anonymous online survey was voluntary; the paIticipant had the right to stop the survey at any time. Participant confidentiality was protected. Their selection and palticipation were not shared with other palties and all such information relating to participants was destroyed at the conclusion of the data collection process. 29
The respondent observed two decision points in the survey. One point explores lean as the current process improvement strategy or process management where the University of
Wisconsin-Stout graduate was employed. In the same setting, the instance where lean was not the cunent process improvement strategy; the respondent was asked to share their understanding of why lean was not the current process improvement strategy or process management approach.
The respondents chose one decision point and proceed to share their knowledge of their organization.
Data Analysis
The Research was conducted to ascertain the number and scope of businesses and organizations utilizing lean where graduates of the University of Wisconsin-Stout were employed. Considering no two qualitative surveys are the same each approach to their evaluation will be different (Patton, 2002). However, using a through literature review and the data from the survey, an evaluation was performed based on the prearranged goals for the research.
• Evaluate the number of organizations utilizing lean philosophies where University of Wisconsin-Stout finds employment. • Sectors of business and industry where is lean operated. • Length of time lean been in use at the current employer. • Why lean is working. • If lean is not used, why not. • What is process improvement strategy or process management is utilized in place of lean.
Coding of the data was done using NVivo Qualitative software through the Applied
Research Center at the University of Wisconsin-Stout. After all the data was collected and coded, it was reviewed for revisions where needed. After all coding was completed; reports were created to determine the frequency of the comments in each theme. Tables and figures were created for each theme/subtheme containing frequencies. 30
Limitations
The subjects of this study are limited the undergraduates of the University of Wisconsin
Stout programs in Business, Business Administration and Engineering Technology from the years running consecutively from 1995 to 2009.
a. The participation of respondents was voluntary.
b. The respondent had to know of the operational strategies of their employer, past
and present.
c. Recommendations are for the University of Wisconsin-Stout, it 's programs,
Business, Business Administration and Engineering Technology and the College
of Operations and Management.
d. The findings in this studying are not predicted to be valid after 5 years.
Summary
A web-based survey was used to reach alumni of the University of Wisconsin-Stout. This national investigation was intended to reveal both the industries and the sector of the business where lean and other process improvement methodologies are practiced. An addition to those goals, it is important to establish a benchmark at this time in order to understand trends that develop as a result of future research into this topic. 31
Chapter IV: Results
The intention of this chapter is to report the findings of the eighteen question instrument sent out to Stout graduates in business and industry. At the third question, "Do you cUlTently use lean as a strategy within your organization?" a decision point is created. If a respondent replies to the question in the affirmative, the subject is directed to one set of questions illuminating the practices oflean principles within the paI1icuiar organization. If the respondent replied that lean was not used, the respondent was directed to a different set of questions than those, which replied in the affirmative. The rational for the approach was to understand ifthere is a shift away from or towards lean and to understand what other process management techniques exist in the organizations where graduates of the University of Wisconsin-Stout work.
Data Analysis
The first question in the survey was constructed to ascertain the specific sector of a business or industry the Stout graduate was employed within. When the question as asked,
"Describe the business or industry that best describes your organization," 100% of respondents selected an option; there is a clear understanding of the cross section of opportunities for Stout grads.
Table 1
Select the business or industry that best describes your organization.
Response Frequency (N=78) Percentage
Manufacturing 31 38%
InsurancelFinancial 14 17%
- - --- . - .-- _. I Hospitality/Tourism 8 10%
I - - -- Retail 6 1- 8% 32
- . -- Distribution 5 7%
Technology 5 7%
Medical 4 6%
Service 4 6%
Food Production 1%
The second question was focused the number of employees in the organizations where
Stout students were working. The size of an organization may speak to the notion of how fast
change can occur within an organization, or how responsive that organization might be to
adapting to new methodologies. The finds reflect there are more small and large firms utilizing
lean methods, however, around 10% of the sampled population works in the mid-range size of
organizations; just under half of the respondents work in large organizations.
Table 2
How many people are in your organization?
Response Frequency (N=78) Percentage
1-10 8 10%
11-25 9 11% L______I 26-50 4 5%
51-100 5 6%
101-500 16 21%
More than 500 37 47% 33
Organizations where Lean is utilized
The survey addresses one of the principle questions of this investigation, which was, "Do you cUlTently use lean as a strategy within your organization?" The effort was to quantify the number of employers utilizing lean, a question which lacked sufficient evidence and lead to this research. Any recommendations to result out of the research would be expressed based on the findings. Clearly, lean is practiced in about half of all the employers of students from the
Business; Business Administration and Engineering Technology programs sat the University of
Wisconsin-Stout.
Figure 1
Do you currently use Lean as a strategy within your organization?
Yes No
It is not only important to know how many employers utilize lean methodologies, but where, within an organization lean is practiced; question 4 sought to answer that. This reflects an effOli to understand which aspect of an organization can benefit from this process management · approach. A majority of replies stated the use of lean throughout the entire organization. This opposes the idea lean is limited to the production aspect in business and industry. 34
Table 3 Within your organization, where do you employ lean?
Response Frequency (N=31) Percentage
Top to Bottom 19 61%
Production 8 26%
- Supply Chain 3 10%
Industrial Engineering 3%
The fifth question of the survey, results reflected in Table 4, addresses how long lean has been practiced in the corresponding organization. Stout graduates reported 52% of their employers have made commitments to lean for 5 or more years. While the remainder, 48% have implemented lean in the last 5 years or less; 29% of respondents have seen lean come online in their organization since 2008. The data shows the slight decline in the use of lean principles in the last 3-5 years, however the numbers of organizations putting lean into practice is beginning to increase once again.
Table 4 How long has your organization used lean?
Response Frequency (N=31) Percentage
Ten years or more 3 10%
Five to ten years 13 42%
Three to five years 6 19%
r _ • • _ .~ . -- - - Two years 3 10%
One year 3%
Less than one year 5 16% 35
ImpOliant to any organization for the methodologies selected for process management is
profit or a return on investment (ROI) for an organization, lean is no exception. When asked,
"Has lean given your organization a return on its investment?" In Table 5 Stout graduates
reported they strongly agreed, at a rate of 39% of the time, that lean had provided a return on
investment to their organization. Those that would agree to the statement are slightly higher at a
rate of 42%. While 16% of respondents could not confirm if lean lead to a profit of a loss, it is
clear for 81 % of those polled, their organization have receive a financial benefit for establishing
lean as their method of process management.
Table 5
Lean has given our organization a return on our investment in iI.
Response Frequency (N=31) Percentage
Strongly agree 3%
Disagree o 0%
Neither agree or disagree 5 16%
~ Agree 13 42%
Strongly agree 12 39%
Not all organizations started with lean as a way to reduce waste, improve efficiencies,
and maximize customer delight. Some organizations tried the statistical-based model introduced
by Demming in the last century; Total Quality Management was attempted by 13 % of employers
of Stout graduates before moving to lean. Toyota's Just-in-Time principles were applied injust
6% of organizations surveyed. The highest rating of this category went to Motorola's Six Sigma;
29% of the locations Stout graduates were employed at use the variation-control process 36 management method. For some employers, 29%, lean is the first recognized attempt at a process
management solution, having not tried any other methodology previously. It appears that 16% of
respondents utilize a multi-method approach to process management. One Stout graduate
observed both Total Quality Management and Theory of Constraints employed in their
workplace, at the same time. Others repolied the use of Six Sigma in one area of the organization
while at the same time utilizing Just-in-Time concepts for a competitive edge. One Stout
alumnus indicated that "several tools from multiple strategies" were implemented in their place
of work; this demonstrates a "cafeteria" approach where one picks and chooses from all the
options available, based on what they want out of each operational strategy.
When asked, "what brought your organization to lean?" 42% of those polled responded
that it was a management decision to move to lean practices some where within their
organization. Streamlining a process was the motivation of moving to lean for 26% of
organizations. The choices of the reputation of lean, a management decision, too many
operational enors, to reduce waste, streamline process and the recommendation of a consultant
were all the reasons for 7% of the sampled population to accept lean as their organizations
operational strategy. Because lean addresses all of the considerations stated above, leans
reputation lead 6% of those examined to use lean in day-to-day operations. While lean is known
for its ability to reduce waste, it was only 10% of the population that admitted it as the single,
most impoliant reason for the move to lean.
The move to lean is intended to produce a benefit to an organization. When the use of
lean had ended for an organization this research attempted to understand the issues sunounding
the decision to move away from lean practices. Of those responding to this question on the
survey 50% of respondents believed it was not the COlTect organizational fit. There were 20% 37
that responded that when current management left, so did the lean practices within the
organization.
Figure 2
Select the benefits your organization realized in its use of Lean 40% ,------
30% +------i
20% +------,---~-----
10% +------;
Greater Increase Reduction of Reduced Reduced waste Increased All of the above teamwork production errors redundancy profits across organization
When Lean is not utilized
As stated above, 52% of respondents indicated that lean was not in use at their respective
place of employment. Of those employers where University of Wisconsin-Stout were employed,
half of the aforementioned respondents had observed no process management approach was in
place. It is fair to conclude from the statistical analysis that only 25% of all employers examined
in this research do not use any fOlmal, planned, or measurable approach in how their employers
conduct their operations. Six Sigma is clearly the second choice in the workplace; for those
polled, 20%, have selected Six Sigma as their pre felTed operation strategy. Total Quality
Management and Just-in-Time shared equal usage in non-lean use at ten percent. Three
respondents failed to indicate which operational strategy, other than lean, was in place at the 38 employer. Lean Sigma was intentionally left off the list of options to choose from . Those that did utilize lean would have answered a different set of questions based on how the decision point was placed early in the survey.
There were organizations which had implemented lean in their past, but had moved to another operational strategy. Half, 50%, of those that had implemented lean, had moved on to
Six Sigma as their operational strategy. While 17% have accepted Just-in-Time as the new approach to conducting business. The length of time lean was in use in organizations where Stout graduates work is informative. Employers that no longer use lean principles had stated, at a rate of 17%, that lean was used for 3 to 5 year time period before the use of lean had ended.
However, the majority, 83%, stated that lean was only in practice for one year or less before its discontinuance. To attempt to understand why lean may not have worked for certain organizations, respondents replied 5% of the time that lean was too complex. On a similar track
50% of those polled stated that lean was not a con-ect fit for the organization that had moved away from lean principles. When management changed so did the process management approach according to 4% of the population; it appeared lean left with the management that support it.
In examining the reasons why an organization may not be seeking a lean advantage, the sample group, as displayed in Figure 3, stated 52% of organizations lack the knowledge to utilize
lean. While the lean philosophy states that anything that does not add value to the customer is waste and, thus, should be eliminated, 22% of respondents stated there was no value in
implementing lean. Too implement lean would have been too complex of a process management philosophy to practice, according to 13% of those polled. That figure comprises a 65% segment
of organizations that have either no knowledge of lean of believe it is too complex to implement.
For organizations not using lean, 9% believed they would not know when they are "there"; 39 meaning the outcomes or justification for the use of lean are not easily identifiable. A small percentage, 4%, believed the successes of Jean methods are yet unproven.
Figure 3
Reasons an organization may not use Lean
60% ~------52% 50% +------r--~
40% -r------~
30% ~------~ 22% 20% +------f---,------~ 13% 9% 10% +---~~M------~
0% +------'-- Success is Won't know Too complex Don't see value in No knowledge of unproven when "there" Lean Lean
A Look at University of Wisconsin-Stout Graduates
The largest segment of respondents, 74%, identified themselves as undergraduates with a degree in General Business Administration. The next largest population, 16% had graduated
Stout with an undergraduate degree in Engineering Technology; 9% of those polled did not identify which program they had graduated from.
When asked how the alumni ofthis survey believed the University of Wisconsin-Stout had prepared them for an organization interested in lean, 5% strongly disagreed with asseltion they were prepared. Almost in balance with those graduates, 3%, that strongly believed
University of Wisconsin-Stout had prepared them for lean practices in business and industry. An additional 20% of respondents disagree with the premise that they we prepared to practice lean, a 40 smaller percentage compared to the 23% that did agree the University of Wisconsin-Stout had prepared them for lean in the workplace. However, 49% of those surveyed took a neutral position and stated they neither, agree with or disagree with the question pertaining to the question asking if the University of Wisconsin-Stout had prepared them well for lean in business and industry.
When University of Wisconsin-Stout graduates were asked how Stout could or should be preparing students for lean in business and industry their insights can be seen in Table 6.
Table 6
In }Fhat way could or should UW Stout be preparing graduates to utilize lean in industry.
Response Frequency (N=57) Percentage
More classes on lean 33 58%
Co-ops and internships 36 63%
On campus workshops 24 42%
Guest speakers 19 33%
It is clear that the graduates of the University of Wisconsin-Stout have clear ideas on their preparation for work in business and industry. Their views reflect a hands-on approach to learning about lean. The possibility of working in an organization where lean principles are currently practiced was seen as the greatest opportunity to bring that knowledge forward. A greater concentration of classes focused on lean was also important to a majority of respondents.
While a large minority believed their knowledge, skills and ability of using lean would improve with workshops and guest speakers on campus. 41
Chapter V: Discussion
To determine the number of organizations utilizing lean as an operational strategy or process management, where University of Wisconsin-Stout graduates work, a convenience survey was conducted among graduates of the Business, Business Administration and
Engineering Technology programs from the years 1995 through 2009. The investigation was to assist in determining the scope of the use of lean within an organization and if there has been an identifiable trend in the increase or decrease of the use of lean and how to prepare students to meet the needs of business and industry.
Limitations
The subjects of this study are limited the undergraduates of the University of Wisconsin
Stout programs in Business, Business Administration and Engineering Technology from the years running consecutively from 1995 to 2009.
a. The participation of respondents was voluntary.
b. There is no way to confirm the responses to the survey.
c. The respondent had to know of the operational strategies of their employer, past
and present.
d. The findings in this studying are not predicted to be valid after 5 years.
Conclusions
This work examined operational strategies other than lean, which are in place in business and industry. Some operational strategies focus specifically at the supply chain .TIT, for example.
There was also production methodologies (TOe) used conjunction with supply chain practices
(.TIT) in places where graduates of Stout worked. Both TQM and Six Sigma are centered on the 42 elimination of variations in production was also practiced among those surveyed. Even the blended methodologies of Lean Six Sigma which is focused on the improving organizational efficiencies through the practice of eliminating variations in production and the elimination of any process that does not add value to the customer was popular in organizations surveyed. Six
Sigma and Lean Six Sigma requires highly trained individuals specializing in the analyzing of data; this approach requires individuals committed to the process and may not have another function .within the organization. Lean does not require the level statistical evaluation Six Sigma requires, which may be one of the reasons lean is in place in 48% of respondents work. It is easier to employ within an organization and the stmi-up costs are not as great as the cost of implementing a Six Sigma strategy (George, Rowlands and Kastle). Lean offers what may be the most widely adaptable approach to process management applicable to modern production methods to be seen to date.
Recommendations
Lean is the most widely applied process management methodology in place for working graduates of the University of Wisconsin-Stout. Of the organizations investigated, 20% utilized
Six Sigma while TQM along with JIT both experienced a rate of implementation of just 10% each. When compared to 48% of respondents stating lean practices where in use, lean is practiced at a rate that is more than twice as large as the nearest alternative methodology. Lean usage appears to be on the increase in the last several years. In the last five years 48% of those surveyed stated lean had been implemented. Those repOliing, 52%, state lean has been a part of their organizations philosophy for five years or longer. It is also import to note that while 61 % of organizations use lean through out their entire organization, 26% of organizations found it 43 beneficial to the production side of the organization. Only 10% of respondents claimed the use of lean was limited to the supply chain management.
As a result of this study there is reason to believe that further research into the process management practices of employers where University of Wisconsin-Stout graduates are employed should continue. The first consideration for this recommendation is to help identify trends in business and industry as it relates to what operational strategies many University of
Wisconsin-Stout graduates may experience in the workforce. The second consideration is to advise the University of Wisconsin-Stout as to the forecasted need for education of lean principles graduates will need when they enter the workforce. While there is a clear need for the
University of Wisconsin-Stout to continue or increase the number of lean related course offerings, respondents have identified the oppol1unity of increased co-ops and internships as vital to their understanding and preparation to practice lean in business and industry upon graduation.
Only slightly less significant was the need for more or more extensive classes on lean. This would address the needs of 85% of respondents that don't use lean; stating their organizations lack a working knowledge oflean, that it is too complex or don't see the value to their organization to implement lean. It appears the recommendation of those surveyed would decrease the lack of understanding and knowledge for the application of lean in their respective organizations. When Stout graduates contribute to the success of an organization through their knowledge and application of lean principles it not only increase the value of the graduate to the employer, but to the University of Wisconsin-Stout in its attempt to meet the needs of business and industry.
The survey respondents revealed there are benefits to the utilization of lean within the place of their employment. If students have a working and applicable knowledge oflean it may 44 increase their opportunity for employment. This claim is substantiated by the fact that those organizations that employ lean practices, 81 % have claimed to receive a return on the investment for implementing lean. As Figure 2 revealed, there are many benefits for the use of lean in business and industry. The University of Wisconsin-Stout can play an impOliant pati in preparing individuals for the practice of lean. If a Stout graduate has the knowledge, skills and ability to lead an organization to reduce errors in production, reduce waste and increase profits, the demand for their services will be in demand. Thus the demand for University of Wisconsin-Stout students will increase in business and industry.
It is clear that process management is a way to success for a globally completive organization. This research proves lean experiences the widest application of process management methods applied today, where graduates of the University of Wisconsin-Stout graduates work. Lean is seen in organizations of various sizes and in various sectors of the economy. To meet the needs of organizations moving to lean or already utilizing lean practices the University of Wisconsin-Stout serves a critical role. The exposure to lean for students outside of business administration and engineering technology is becoming increasing important based on the results of this survey. My hope is this research leads the University of Wisconsin-Stout to evaluate the needs of business and industry and offer the students of Stout an education rich in applicable lean practices in preparation of their employment in a variety of areas around the world. 45
References
Aguayo, R. (1991). Dr. Deming: The American who taught the Japanese about quality.
Fireside: Whitby, Ontario
Becker, J., Kugeler, M. & Rosemann, M. (2003). Process management. New York: Springer
Publishers
Bongiorni, S. (2004). All in the timing. The Greater Baton Rouge Business Report. 19 July 2004
Caplan, J (2007). Cause of death: Sloppy doctors. Time. Retrieved from
http://www.time.com/time/healthiarticle/0.8599.1578074.00.html
Conner, G. (2001). Lean manufacturing for the small shop. Dearborn, Michigan: Society of
Manufacturing Engineers
Edgeman, R. & Dugan, G (2008). Six sigma from products to people to pollution. Total Quality
Management. 19(1-9)
Emiliani, B. Stec, D., Grasso, L & Stodder, J. (2007). Better thinking, better results: case study
and analysis of a enterprise-wide lean transformation. Center for Lean Business
Management, ISBN 978-0-9722591-2-5
George, M., Rowlands, D. & Kastle, B. (2004). What is lean six sigma? New York:
McGraw-Hill
Goldratt, E. & Cox, J. (1986). The goal: a process ofongoing improvement. Hudson, NY: North
River Press
Goldratt Institute (2009). The theory ofconstraints and its thinking processes. Manuscript
submitted for publication.
Hirano, H. & Makota, F. (2006). JIT is flow: practice and principles of lean manufacturing.
Vancouver, W A: PCS Press Inc. 46
James, T. (2005). Stepping back from lean. Manufacturing Engineer, 84 (1) p. 16-21
Johnson R., Kast, F. & Rosenzweig, 1. (1973). The themy and management ofsystems. New
York: McGraw-Hill
Kerschberg, L. and Jeong, H. (2005). Just-in-time knowledge management. Retrieved from
eceb.gmu. edu/pubs/JIT_ KM_Kerschberg_Jeongpd!
Krafcik,1. (1988). Triumph of the lean production system. Sloan Management Review, 30(1)
p.41-52
Long, 1. (2010). What is lean? Manuscript submitted for publication.
Motorola University (2010). What is six sigma? Retrieved from
http://www.motorola.com/BusinessIUS-EN/Motorola+University/Six+Sigma+Articles
Ohno, T. (1988). Toyota production system. New York: Productivity Press
Patton, M. (2002). Qualitative research and evaluations methods. Thousand Oaks, CA: Sage
Publications
Spendolinni, M. (1992). The benchmarking book. New York: AMACON
Stamatis, D. (2004). Six sigma fundamentals: a complete guide to the system, method and tools.
New York: Productivity Press
Tennant, G. (2001). Six sigma: spc and tqm in manufacturing and services. Aldershot, UK:
Gower Publishing
Thorn, W. (2009). People, process, and petformance management in project management.
Retrieved from http://www.pmhut.com!people-process-and -performance-management- in
proj ect -management 47
Womack, J., Jones, D. & Roos, D. (1990). The machine that changed the ."orld. New York:
Simon & Schuster
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Womack, 1. & Jones, D. (2005). Lean solutions. New York: Free Press 48
Appendix A: Survey Invitation
Greetings Fellow Stout Alum:
My name is Tom Harvey and I am currently pursuing a graduate degree at UW-Stout. I am researching Lean as a management strategy across the spectrum of business and industries represented by Stout graduates. Even if your organization does not currently use Lean there are questions in the survey for you as well. This, less than 5-minute, survey will allow post-secondary institutions, such as Stout, to improve their educational priorities based on your input into this research; so please participate now.
You can double-click on the provided link to complete the survey, if necessary you may copy & paste the link into your Internet browser to connect to the survey. Your participation in this study is entirely voluntary. You may choose not to participate without any adverse consequences to you. If you complete the survey I will provide you with the results of my research, just email for a copy at the completion of the research.
This survey will terminate in 15 days so your quick action is vital to this research. Feel free to contact me at (715) 456-3623 cell, (715) 232-1145 office or by email at [email protected] if you have any questions or ideas pertaining to my research; any input is welcome. Thank you for your valuable time. Go Blue Devils!
This project has been reviewed by the UW-Stout IRI3 as required by the Code of Federal Regulat ions Title 45 Part 46 49
f, I 11 /~;::::; 152 Voc Rehab Buildmg UnivclsityofWiscof)<;in StOlit Appendix B: IRB Exemption STO UT P.O. [lo, 790 tv1mlOIllOJHC, WI 5·1751 0700
7151232·1126 7151232·1749 (fax) !..l!..t l) It ....,, ',",'·.·) I'V)', l o ll! c ll u ! r~ :
Date: December 16, 2009
To: Thomas Harvey Jim Keyes
From: Sue Foxwell, Research Administrator and Human ~6UJ y~~ Protections Administrator, UW-Stout Institutional Review Board for the Protection of Human Subjects in Research (IRB)
Subject: Protection of Human Subjects in Research
Your project, "Lean Manufacturing in Business & Induslly " is Exempt from review by the Institutional Review Board for the Protection of Human Subjects. The project is exempt under Category 2 of the Federal Exempt Guidelines and holds for 5 years. Your project is approved from December 14,2009, through December 13,2014.
Please copy and paste the following message to the top of your survey form before dissemination: I.T=h=iS=. p=ro=~c=ct=h=as=b=c=cn=r=CY=ic=W=Cd=b=Y=t1=lc=U=W=-=S=to=ut=IR=B=as=rc='q=ui=rc=d=b=Y =th=c C=o=d=c =of==; [ Federal Regulations Title 45 Part 46 I I L-______~ If you are conducting an online surveylinterview, please copy and paste the following message to the top of the form: "This research has been approved by the UW-Stout IRB as required by the Code of Federal regulations Title 45 Part 46."
Please contact the IRB if the plan of your research changes. Thank you for your cooperation with the IRB and best wishes with your project.
*NOTE: This is the only notice you will receive - no paper copy will be sent. 50
Appendix C: Survey Results 1. Select the business or industry that best describes your organization.
# Answer Response % 1 a. Distribution 3 4% 2 b. Food Production I 1 1% 3 c. Hospitality/Tourism 7 9% 4 d. Manufacturing 26 33% 5 e. Medical 5 6% 6 f. Retail 6 8% 7 g. Other 30 38% Total 78 100% g. Other # Statistic Value Financial Services / Banking 6 Mean 5.14 Insurance 6 Variance 3.06 Technology and professional services 3 Standard Deviatio n 1.75 Facility Services 2 Total Responses 78 Aerospace 1 Center for Applied Ethics 1 Construction 1 Distribution/Manufacturing 1 Electrical 1 Government 1 Health Fitness Clubs 1 Multifamily/Real Estate 1 Paper Converting 1 Railroad Transportation 1 Real Estate Development 1 Sawmill for log home company 1 Software / Consulting 1 Wholesale-giftware 1 51
2. How many people are in your organization?
# Answer Response % I 1-10 8 10% 2 11-25 9 12% 3 26-50 • 4 5% 4 51-100 • 5 6% 5 101-500 • 16 21% 6 More than 500 37 47%
Statistic Val ue Total Responses 78
3. Do you currently use Lean as a strategy within your organization?
# Answer Response % 1 Yes 41 48% 2 No 44 52% Total 85 100%
Statistic Value Mean 1.52 Variance 0.25 Standard Deviation 0.50 Total Responses 85 - 52
4. Within your organization, where do you enlploy Lean?
# Answer Response % 1 a. Production/Operations I 8 26% 2 b. Supply Chain 3 10% 3 c. Industrial Engineering 1 3% 4 d. Transpoliation I 0 0% 5 e. Top to bottom 19 61% Total 31 100%
Statistic Value Mean 3.61 Variance 3.31 Standard Deviation 1.82 Total Responses 31
5. To the best of your knowledge how long has your organization used Lean?
# Answer Response % 1 Ten years or more 3 10% 2 Five to ten years -1• .",,- .. '''" ;.:...... ""''''_ 13 42% 3 Three to fi ve years -' - l 6 19% 4 Two years 3 10% 5 One year 1 3% 6 Less than one year 5 16% Total 31 100%
Statistic Value Mean 3.03 Variance 2.57 Standard Deviation 1.60 Total Responses 31 53
6. Lean has given our organization a return on our investment in it. State your understanding of this statement.
# Answer Response % 1 Strongly Disagree 1 3%
2 Disagree I 0 0% 3 Neither Agree nor 5 16%
4 Agree r~ ',11 •• 13 42%
5 Strongly Agree ,.i.c_' '~"'-I 12 39% Total 31 100%
Statistic Value Mean 4.13 Variance 0.85 Standard Deviation 0.92 Total Responses 31
7. What, if any, was your operational strategy before moving to Lean?
Answer Response %
1 a. None r·," " 9 29% 2 b.TQM 4 13%
3 c. Six Sigma ~. 9 29% 4 d. Just In Time • 2 6% 5 e. Lean Sigma I 0 0% 6 f. TOe Manufacturing I 0 0%
7 g. Other I 7 23% Total 31 100%
I g. Other 54
Not positive - know that other methods were used, though Tools from mUltiple strategies still incorporated today. Both Band F Depends on the area, we use Six Sigma and Just in Time also All Above VMr
Statistic Value Mean 3.26 Variance 5.06 Standard Deviation 2.25 Total Responses 31
8. If you do not utilize Lean, select your current operational strategy?
# Answer Response % 1 a. None 15 50% 2 b.TQM 3 10% 3 c. Six Sigma 6 20% 4 d. Just In Time 3 10% 5 e. TOe Manufacturing 0 0% 6 f. Other 3 10% Total 30 100% f. Other N/A Statistic Value Mean 2.30 Variance 2.70 Standard Deviation 1.64 Total Responses 30
9. If your organization has moved away from Lean as an operational strategy what are you currently using? 55
# Answer Response % 1 a.TQM 0 0% 2 b. Six Sigma 3 12% 3 c. Just In Time 1 4% 4 d. TOe Manufacturing 0 0% 5 e. Never used Lean 20 77% 6 f. Other 2 8% Total 26 100% f. Other Statistic Value N/A Mean 4.65 Variance 1.20 Standard Deviation 1.09 Total Responses 26
10. To the best of your knowledge, if your organization has used Lean in the past, how long was it employed?
Answer Response % 1 Ten years or more I 0 0% 2 Five to ten years I 0 0% 3 Three to five years 1 17% 4 Two years I 0 0% 5 One Year I 0 0% 6 Less than one year 5 83% Total 6 100%
Statistic Value I Standard Deviation I 1.22 I Mean 5.50 Variance 1.50 Total Responses I 6 I
11. If your organization does not use Lean select the reason it does not. 56
# Answer Response % a. Too expensive 0 0% . 2 b. No knowledge of Lean ."-!.- - • '....:. r,ta- 12 52% 3 c. Too complex 3 13% 4 d. Success is unproven 1 4% 5 e. It is just "the latest thing" 0 0% 6 f. Won't know when we are 2 9% 7 g. Did not see a value in it 5 22% Total 23 100%
Statistic Value Mean 3.65 Variance 4.60 Standard Deviation 2.14 Total Responses 23 57
12. What brought your organization to Lean?
# Answer Response % 1 Leans reputation 2 6% 2 Management decision 13 42% 3 Too many operational 0 0% 4 Reduce waste 3 10% 5 Streamline processes 8 26% 6 Recommendation of 0 0% 7 Other 5 16% Total - 31 100%
Other Has always been part of our culture. All of above Management, reputation, operational elTors, reduce waste. All of the above Economy
Statistic Value Mean 3.71 Variance 4.01 Standard Deviation 2.00 Total Responses 31 58
13. Select the benefits to your organization has realized in its use of Lean.
# Answer Response % Increase in production 2 6% 2 Reduction of errors 2 6% 3 Reduced waste 5 16% 4 Reduced redundancy 2 6% 5 Increased profits 7 23% 6 Greater team work across 3% 7 Other 12 39% Total 31 100%
Other All of above 8 Several of the above (reduced waste, redundancy, increased production efficiency, All of the above on various projects None yet
Statistic Value Mean 4.97 Variance 4.03 Standard Deviation 2.01 Total Responses 31 59
14. Describe your understanding of why Lean may not have worked within your organization.
Answer Response % 1 Too complex 1 5%
2 Proved unsuccessful I 0 0% 3 Change in management 4 20%
4 Moved to different I 0 0% 5 Was not the COlTect fit in 10 50% 6 Other 5 25% Total 20 100%
Other nla Hasn't been used. Probable would not work in my industry Just a distribution plant that has not tried Lean Unknown
Statistic Value Mean 4.65 Variance 1.82 Standard Deviation 1.35 Total Responses 20 60
15. UW Stout has prepared me well for the use of Lean as an operational strategy in business/industry?
# Answer Response % 1 Strongly Disagree 3 5% 2 Disagree 12 20% 3 Neither Agree nor 30 49% 4 Agree 14 23% 5 Strongly Agree 2 3% I- - • Total 61 100%
Statistic Value Mean 3.00 Variance 0.77 Standard Deviation 0.88 Total Responses 61
16. In what way could/should UW Stout be preparing graduates to utilize Lean in industry?
# Answer Response % 1 a. More classes on Lean 33 58% 2 b. Co-ops and Internships 36 63%
3 c. On campus workshops l"'''1,' '"'~ .~=i, 24 42% 4 d. Guest speakers 19 33%
Statistic Value Total Responses 57 61
17. Class of:
Value Total 1997 5 2007 4 2000 7 1995 2 2009 1996 6 1999 5 [No Value] 9 2008 6 2006 5 2001 4 2005 6 Value Total BS 78 2003 8 1998 4 [No Value] 9 2002 9 2004 6
18. Prinlary Degree
Value I Total General Business Administration I 64 Engineering Technology 14 [No Value] 9