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  You will also need to ensure the focus remains on keeping the KPIs on the data that they are detailing and use it as a means of determining the overall health of the business as opposed to a set of numbers that can only move one way. If your team ends up too focused on reaching a predetermined KPI, the data they return will be biased and inaccurate.

  Chapter 7: Kanban

  Kanban is a method of scheduling that is often used once a Lean system has been put in place. It serves as a type of inventory management whose end goal is to minimize waste in the supply chain. It also tends to come in handy when it comes to pinpointing problems as it makes these problem areas stand out more than they otherwise would. You will also find it useful when it comes to locating the upper end of work related to inventory that is currently underway to ensure the process doesn’t overload.

  This is a demand-driven system which means, it is often implemented as a means of ensuring quicker turnaround times while at the same time limiting the required inventory and increasing the overall level of competitiveness between the implementation team. It was first put into effect by Toyota in the 1940s after the company performed a study on supermarkets and decided to use similar practices in order to keep their factories optimally stocked at all times. This eventually became one of the core Kanban ideas of keeping inventory amounts level with consumption rates. Additional supplies are then added based on a predetermined set of signals to ensure that stock remains near the ideal level at all times instead of dipping low or overflowing at certain points. The signals in question are all based upon customer signals which means they can change at the moment if needed.

  Kanban rules

  Each process creates an amount set by the Kanban.

  Following processes collects the number of items set by the Kanban.

  Nothing is created or moved with a Kanban.

  Kanban is attached to related goods.

  Defective products are not counted in the Kanban.

  The fewer the Kanban, the more sensitive the system is.

  Kanban cards: Kanban cards are the means by which signals are used to keep the entire team on track as it moves through the process. While they were actual cards when the system was created, these days, there is a wide variety of software out there that will provide the relevant signals without bringing physical cards into the process. Kanban cards generally represent consumption via a lack of cards in one area which, by necessity, drives another part of the process to do what needs to be done in order to pass the relevant cards along.

  These days, the electronic Kanban system is even more effective than its physical predecessor, making it a sure thing to ensure that cards get where they need to be when they need to be there. These systems often mark set types of inventory with specific barcodes that are then scanned throughout the process. Each scan then sends a specific message to the Kanban program which routes it as needed.

  Kanban types: There are two main varieties of Kanban systems namely production systems and transportation systems. Production systems are sent as a means of authorizing production or a specific number of items, while the transportation systems are used as a means of authorizing the movement of specific items once they have been created.

  Three bin system: An example of a basic type of kanban system is the simple three bin system for the supplied parts in scenarios where manufacturing does not take place in-house. One bin represents the factory floor (or the primary point of demand anywhere else), the second bin represents the factory store (the control point for the inventory), and the final bin represents the supplier. The bins then can have removable cards containing relevant product details along with any other important information.

  When the factory floor bin empties out because the relevant parts were all taken up by various parts of the manufacturing process, the empty bin, and thus its kanban card, are then returned to the factory store (also known as the inventory control point). The factory store then replaces the empty factory floor with the full factory store bin which also contains its own kanban card. The factory store then sends the empty bin and its related kanban card on to a supplier. This, in turn, causes the full product bin from the supplier to eventually replace the empty bin on the factory floor and the process starts all over again. Thus, the process never runs out of product. This could also be described as a closed loop, since it provides the exact amount required, with only one spare bin so there is never oversupply. This 'spare' bin allows for uncertainties in supply, use, and transport in the inventory system. A good kanban system calculates just enough kanban cards for each product. Most factories that use kanban use the colored board system

  Chapter 8: 5s

  When it comes to determining what wasteful processes you are dealing with, it is important to ensure the work environment is in optimum shape for the best results. The 5S organizational methodology is one commonly used system based around a number of Japanese words that, when taken together, are first rate when it comes to improving efficiency and effectiveness by clearly identifying and storing items in their designated space each and every time.

  The goal here is to allow for standardization across a variety of processes which will ultimately generate significant time savings in the long-term. The reason it is so effective is that each time the human eye tracks across a messy workspace, it takes a fraction of a second to locate what it is looking for and process everything around it. While this might not be much if it happens now and then, if it is happening constantly across an entire team, then it can add up to serious time loss when taken across the sum total of the process in question

  Sorting: Sorting is all about doing what can be done in order to always keep the workplace clean of anything that isn’t required. When sorting, it is important to organize the space in such a way that it removes anything that would create an obstacle towards the completion of the task at hand. You will want to ensure that process-critical items all have a unique space that is labeled as well as a space that is designated for those things that simply don’t fit anywhere else. Moving forward, this will make it easier to keep the space free of new distractions. Nevertheless, it will still be important to encourage team members to prune their personal space regularly to keep new obstacles from popping up.

  Set in order: When it comes to organizing the items in the workspace themselves, it is important to ensure all the items are organized in the order that they will most likely be used. While doing so, it is important to take care to ensure that everything required for the most common steps remains readily at hand to reduce movement waste as much as possible. Over time, keeping things in the same place will ensure that the process can be completed faster each time as muscle memory takes over, and team members are able to reach for things without looking for them.

  It is important to keep an open mind during this step since ensuring that the workspace is set up in such a way that ease of workflow is promoted may require more than a simple organization, it may require a serious rework of existing facilities. Additionally, ensuring everything is arranged correctly will make it easier for you to create steps for each part of the process that anyone new to that part of the process can follow.

  Shine: Keeping the workspace clean is an essential part of maintaining the most effective workspace possible. It is important to emphasize the importance of daily cleaning both for the overall efficiency boost and its ability to ensure that everything is where it is supposed to be so that there are no issues the next time they are needed. This will also provide an opportunity to have a regular maintenance if any is needed, which will serve to make the office a safer place for everyone. The end goal should be that any member of the team should be able to enter a new space and understand where the key items are located in less than five minutes.

  Standardize: The standardize step is all about making sure the organizational process itself is organized in such a way that it can be applied throughout the entire business structure. This will make it easier to maintain order when things ge
t hectic and also ensure that everyone can be held to the same reliable standard.

  Sustain: Sustaining the process is vital as taking a week or more to properly get everything in order only to have it all fall apart six months later is going to accomplish nothing in the long-term. As such, it is important to ensure that the organization is a vital part of the DNA of the business in moving forward. If things are truly sustainable in this regard, then team members will be able to successfully move through the process without expressly being asked to. Unfortunately, you won’t be able to expect this type of sustainability overnight. It will require plenty of training and an adoption of the idea as part of the business’s culture.

  Great starter tool: If your plan for your business is to transition to additional advanced Lean concepts over time, then 5S is a great way to start moving employees in that direction. It is especially effective with employees who are extremely stuck in their ways as, once they initially get on board, they will be hard pressed to deny the benefits in completion times that come with the improved organizational version. This, in turn, will make it easier for them to get on board with additional changes that may come in the future.

  As a rule, when rolling out a new system like this, you can expect team members to only care about two things, the way the new system is going to affect them specifically and if the Lean process has actually seen results. This is also what makes 5S a great starting point as it has easily understandable answers for each that anyone can understand once they see the first workspace transformed for efficiency.

  Knowing if 5s is right for your business: While 5S is a great choice for some businesses, it is not a one-size-fits-all solution, which means it is important to understand both of its strengths and its weaknesses when moving forward. Perhaps its biggest strength is that when implemented successfully, it is sure to help your team define their processes more easily while also helping them claim more ownership of the processes they are associated with as well. This extra structure also has the potential to lead to a much greater degree of personal responsibility among team members which will lead to a greater feeling of accountability throughout the process. When everything goes according to plan, this will then lead to further improved performance and better working conditions for everyone involved.

  What’s more, implementing 5S also has the potential to more likely make long-term employee contributions thanks to an internalized sense of improvement. Ideally, this will continue until the idea of continuous improvement becomes the order of the day. When done correctly, using 5S will also provide further insight into the realm of value analysis, equipment reliability, and work standardization.

  On the other hand, the biggest weakness of 5S is that if it, and its purpose, are not communicated properly, then team members can make the mistake of seeing it as the end goal and not a means to an end. 5S should be the flagbearer for success to come in the future, not the sum total of a company’s journey into Lean processes. Specifically, businesses whose movement is constrained significantly by external factors will have a hard time using 5S, and companies that currently have a storage problem would do well to solve it before attempting a 5S transition.

  Additionally, just because 5S is a great fit for many companies doesn’t mean that it will be the best choice for your team. This is especially true for smaller teams or for teams where team members wear many hats. Just because it is a popular way to implement Lean principles doesn’t mean that it is going to be right for everyone. Moving ahead anyway and enforcing organization simply for the sake of organization won’t do much of anything when it comes to generating real results. Instead, it will only generate new waste and it will only continue to do so before it is abandoned entirely.

  This is especially true for businesses that run on a wide variety of human interaction, various management styles, and other management tools. However, when the various aspects work together properly, they will actually end up generating extra value for the customer which is a vital part of any successful business. If you blindly press forward with a 5S mentality, however, then it can become easy to lose sight of the outcome for the customer in pursuit of a perfect outcome or a perfect implementation of 5S principles.

  Above all else, when implementing 5S, it is important that you stress to your team that 5S is something that should be part of the natural work routine and standard best practices, not an additional task to be done outside of daily work. The goal of 5S is to enhance the effectiveness of the workflow at every step in the process. Separating out the 5S into its own separate layer is the complete opposite of what the process stands for.

  Chapter 9: Six Sigma

  Six Sigma is the shorthand name given to a system of measuring quality with a goal of getting as close to perfection as possible. A company operating in perfect synchronicity with Six Sigma would generate as few as 3.4 defects per million attempts at a given process. Zshift is the name given to the available deviations between a process that has been completed poorly and one that has been completed perfectly.

  The standard Z-shift is one with a number of 4.5, while the ultimate value is a 6. Processes that have not been viewed through the Six Sigma lens typically earn around a 1.5.

  Zshift Levels: A Six Sigma level of 1 means that your customers will get what they expect roughly 30 percent of the time. A Six Sigma level of 2 means that roughly 70 percent of the time, your customers will get what they expect. A Six Sigma level of 3 means that roughly 93 percent of the time, your customers will be satisfied. A Six Sigma level of 4 means that your customers will be satisfied more than 99 percent of the time. A Six Sigma level of 5 or 6 indicates a satisfaction percentage of even closer to 100 percent.

  Six Sigma Certification Levels: Six Sigma is broken into numerous certification levels depending on the amount of knowledge the person in question has regarding the Six Sigma system. The executive level is made up of management team members who are in charge of actively setting up Six Sigma in your company. A Champion in Six Sigma is someone who can lead projects and be the voice of those projects specifically.

  White belts are the rank-and-file workers; they have an understanding of Six Sigma, but it is limited. Yellow belts are active members on Six Sigma project teams who are allowed to determine improvements in some areas. Green belts are those who work with black belts on high-level projects while also running their own yellow belt projects. Black belts lead high-level projects while mentoring and supporting those at other tiers. Master black belts are those who are typically brought in specifically to implement Six Sigma and can mentor and teach anyone at any level.

  Implementation: Giving your team a compelling reason to try Six Sigma is vital to the overall success of the process. In order to ensure that Six Sigma is properly implemented, it is important that you properly motivate your team by explaining how crucial the adoption of a new methodology really is. The most common choice in these situations is to create what is known as a burning platform scenario.

  A burning platform is a motivational tactic wherein you explain that the situation the company now finds itself in is so dire (like standing on a burning platform) that only by implementing Six Sigma is there any chance of long-term survival for the company. Having stats that back up your assertions is helpful, though, if times aren’t really so tough, a bit of exaggeration never hurt. Adapting to Six Sigma can be difficult, especially for older employees and a little external motivation can make the change more palatable.

  Ensure the tools for self-improvement are readily available: Once the initial round of training regarding Six Sigma has been completed, it is important that you have a strong mentorship program in play while also making additional refresher materials readily available to those who need them. The worst thing that can happen at this point is for a team member who is confused about one of the finer points of Six Sigma to try and find additional answers only to be rebuffed due to lack of resources.

  Not only will they walk away still confused, but they will also be r
ebuffed for trying and not rewarded for taking an interest in the subject matter. A team member who cannot easily find answers to their questions is a team member who will not follow Six Sigma processes when it really counts.

  Key principles: Lean Six Sigma works based on the common acceptance of five laws. The first is the law of the market which means that the customer needs to be considered first before any decision is made. The second is the law of flexibility wherein the best processes are those that can be used for the greatest number of disparate functions. The third is the law of focus which states that a business should only focus on the problem the business is having as opposed to the business itself. The fourth is the law of velocity which says that the greater the number of steps in a process, the less efficient it is. Finally, the last is the law of complexity which says that simpler processes are always superior to more complicated ones.

  Choosing the best process: When it comes to deciding what process to apply the Six Sigma treatment to, the best place to start is with any processes that are already defective and need work to reduce the number of times they occur. From there, it will simply be a matter of looking for instances where takt time is out of whack before looking into those steps where the number of available resources can be reduced as well.