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Kaizen Principles: Foundation on which the transformation takes place

Guiding principles that help in learning to think Lean

Principle refers to the People’s way of thinking. It is also called mindset.

These Principles are the starting point for Kaizen (Changing for the Better) and are embedded in all the tools; they form the very foundation on which the Kaizen transformation takes place.

Kaizen Principle 1

Below given are the five principles which has to be kept in mind before you start any Kaizen/Lean/Operational/Manufacturing excellence journey:

  1. Create customer value
  2. Eliminate waste
  3. Engage People
  4. Go to gemba
  5. Manage improvements

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Create Customer Value

Customer value = Utility – Price (Utility includes Products & Service Quality)

  • Market In: ‘Market In’ is customer focus to
    • factually understand customers QCD needs
    • anticipate and understand customer’s unstated wants & needs
  • The next operation is customer
    • Every operation has customer & suppliers
    • Who are my internal customers?
    • How do my customers use my input?

Stop MUDA

  • Never pass muda, waste or problems onto the next process:
    • Don’t accept
    • Don’t make
    • Don’t pass on
  • Upstream management
    • Find the problems
    • Solve the problems
    • Avoid/Prevent problems

Kaizen Principle 2

Eliminate Waste

Company value = Price – Cost Waste increases cost and diminishes value. Therefore it is very important to focus on deletion, systematic improvement, value stream structure & pull based.

  • Focus on MUDA: Any activity customer is not ‘Prepared’ to pay for!
    • If you eliminate non value added activities the lead time will reduce and you will get higher flexibility, less stocks, better service, reduced complexity, less cost & improve freshness.
  • Total system optimization: Stresses on integration of total system & appreciates all critical factors.

 functional VS total system 3

Value stream organization

  • Value stream organization is opposite to functional organization
  • Functional organization divides, isolates, creates waste, conflict & inefficiency
  • Value stream organization integrates & appreciates all critical factors
  • There are no isolated autonomous systems – everything affects everything else
  • Pull Flow thinking
    • Pull means that no upstream should produce a good or service until the customer (downstream) asks for it.
    • Pull system reduces the lead time
    • Pull system requires focus on reduction in setup time to enable quick changeover

Engage People

Provide clear objectives at all level. Coach and empower. Develop leadership.

Kaizen Flag 4

  • Welcome problems
    • Where no problems is perceived, there can be no improvement
    • Problems are mountain of treasures
    • People are not problems
    • Increase people capability to solve problem: make people problem solver
  • No Blaming
    • Traditional blaming
      • Judges after the fact
      • Let’s ‘who-is-wrong’ override ‘what-is-wrong’
      • Drives people into defensive positions
      • Submerges issues for years
      • Creates crisis orientation

Therefore focusing on the issue or problem, not on the person, creates an open, trusting, communication rich environment. Blaming VS Leadership 5 Go To GEMBA

Gemba is a Japanese word which means ‘The Real Place’. Gemba refers to the place where value is created; in manufacturing the Gemba is the factory floor. It can be any “site” such as a construction site, sales floor or where the service provider interacts directly with the customer. In lean manufacturing, the idea of gemba is that

  • the problems are visible,
  • and the best improvement ideas will come from going to the gemba.
  • an activity that takes management to the front lines to look for waste and opportunities to practice gemba kaizen, or practical shop floor improvement.

Golden rules of Gemba

  • When an abnormality occurs, go to gemba first
  • Check with Gembutsu (machine, material, failures, rejects, unsafe conditions etc.)
  • Take temporary countermeasures on the spot
  • Remove root cause
  • Standardize to prevent trouble

Manage the transformation

Three things to be kept in mind to manage transformation

  • Focus on process and results
    • Inconsistent process gives inconsistent results
    • Ignoring the processes reduces the chances of desired results
    • While quality processes gives quality results
    • Traditional thinking says ‘I don’t care how you do it, just get it done’. (Results only thinking)
    • People work on processes; Processes create results; Results cannot be changed; Improve process to get improved results;
  • PDCA/SDCA approach

Kaizen Principle 6

  • Visible processes/problems

Visual Management is displaying information. It helps us

  • To depict
    • Parameters
    • Trends
    • Strategic data
  • To show and control process
  • To identify and mark
    • Hazards
    • Reference points
    • Standards

Change thinking- change Environment- change habits – change culture

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative. Looking for more info on Kaizen/Lean/Operational Excellence? Click here

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Announcing specialized training programs

november Training

Based on the feedback from our clients, Kaizen College is pleased to announce its public training programs 

Kaizen college is the executive education & training arm of Kaizen Institute. It operates worldwide at different locations.

We have announced these programs across three cities (Bengaluru, New Delhi and Vadodara) for the month of November.

november Training

The objective of these programs is to support participants enhance their skill sets through contemporary practical learning experiences.

Since its a small group training program, only a limited number of participants will be admitted on first come first serve basis. We may limit the number of participants from the same company if we receive more applications than the maximum number of participants. You can confirm your participation personally or nominate your representative/s for the program by sending the duly filled registration forms.

For further details or to download the brochure & registration form, you may please visit in.kaizen.com or click here

We look forward to your cooperative & participative response


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Time to change paradigms

Mind is a “pattern seeking mechanism”. Our mind gets conditioned – but once conditioned, its difficult to reshape. Learning to Unlearn is most important

What are PARADIGMS?

A paradigm is a way of thinking (based on values and beliefs, and reinforced by standards, habits and results) which influences our way of interpreting a given situation or problem. When we react to a situation in a stereotyped or usual way this is called a paradigm.Each person reacts according to the paradigms adopted.

Paradigms usually stands a long period of time until something occurs to bring into question the validity of the model.

What is CHANGE?

Change means “to cause to be different”. Change begins with acceptance.

We resist change because we fear

  • Fear of failure
  • Creating new habit
  • No obvious need
  • Loss of control
  • Concern about support system
  • Coming out of comfort zone
  • Closed mind
  • Unwilling to learn
  • Fear of personal impact
  • Fear about new way
  • Fear of unknown

Looking at current scenario you all must have noticed that there is a huge resistance to change or changing the paradigms as people think:

  • “We’ve always worked that way”
  • “At first, I cared, but …”
  • “It’s not my responsibility”
  • “No-one told me”
  • “I don’t have the time”
  • “Anyway, it wouldn’t change anything”
  • “Another gizmo which won’t last”
  • “There are more important problems”
  • “It’s not possible here”
  • “We already have enough work”
  • “What’s in it for me?”

5 Stages of change transition

5 Stages of change transition

Individual prerequisites for change to occur

Individual prerequisites for change to occur

Observations of Paradigms

It has been found that Paradigms are common – regional, religious, personal, professional etc.,Paradigms are essential – they give us guidelines, rules & regulations. “My Paradigm is THE Paradigm!” – more of a Warning than an observation. Largely, an outsider brings a shift in a paradigm and One needs lots of courage & conviction to bring a shift in a paradigm

Common management paradigms

Managerial technology is secondary!

Set policy and results will follow!

Train employees and Gemba improves!

Rely on sophisticated tools instead of Gemba tools!

Believes Gemba will ask “What is in it for me?”!

Quality is quality manager’s job!

Efficiency is industrial engineer’s job!

Cost cutting, not cost management (muda elimination)!

KAIZEN without focus and targets!

Do not go to Gemba!

The process of change – Gemba Kaizen Activities

The process of change – Gemba Kaizen Activities

But why do we need “CHANGE”

In a jungle in Africa every morning a lion wakes up and thinks he has to RUN “Faster” than the

“Slowest” Zebra, in order to SURVIVE.In the same jungle every morning…..….a zebra wakes up and thinks he has to RUN “Faster” than the “Fastest” Lion, in order to SURVIVE.

…so it does not matter whether YOU are a Lion Or a Zebra, when the Sun is up, you need to RUN ….For SURVIVAL

BECAUSE

YOU ARE AT WAR …..every  day , every moment , every second

BUT…is running enough ????

How to change the company culture?

People have Paradigms that are made of “Values and Habits”;Results are a consequence of the current “Values and Habits”;Values are related to Mind (what i think)…Habits are related to Gemba (what i do)…To change a Paradigm it is necessary to Change Gembas and to Change Minds…

  • Way to Change Gembas:
    • Do GK – Gemba Kaizen workshops;
    • GK will break old habits and consolidate new ones with Visual Standards;
    • Start Value Stream Projects in Model Areas;
    • Do 5S, SDCA and PDCA at all levels.
    • Continuous Gemba deployment (at the right speed of change).
  • Way to Change Minds:
    • Education and Training.
    • Benchmark (perceive better Gembas);
    • Gemba Kaizen Workshop Training (if you desire to see learn how to act);
    • Read, develop a Vision and exercise the Power of Will;
    • Continuous Education and Training (at the right speed of change).

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

Looking for more info on Kaizen/Lean/Operational Excellence? Click here


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Freedom from darkness

Harish Hande doesn’t care about electrifying India, he wants the solar lamp to transform this country. Of course he was pleasantly surprised when newly appointed Prime Minister Narendra Modi said he would back the growth of solar power so that every household in India has at least one lamp by 2019, but Hande has also observed, for the last 15 years or so, that the ministry of new and renewable energy unfailingly gets a new secretary every six months. “Some don’t feel it’s an attractive post, some are quickly shifted, some retire,” he says with the air of a veteran who has figured out how to make things work despite policymakers.

freedom from darkness

But these are all relatively minor niggles. Hande, 47, won the Ramon Magsaysay Award in 2011 because the ideas at Selco (Solar Electric Light Company—India), the solar energy equipment supplier company he co-founded in 1994, shine brighter than the lights it sells to the poor.

Take, for instance, Selco’s Light For Education project whose participants include around 30,000 children in Karnataka. Solar panels are installed on school premises and the battery, about the weight of a lunch box, is given to children. Children charge the batteries when they come to school. If they don’t come to school, there’s no light at home. “We stole the idea from the midday meals scheme,” says Hande. Stole and innovated.

Or the way Selco tackled the unique problem faced by a community of poor drum-makers in Bangalore. They were willing to pay for solar power, but they had one condition. They were often evicted, with only 15-20 minutes to gather their belongings. Could Selco design a system they could run with? No problem, a design school graduate who works at Selco conjured up a solar system on a cart.

Around 1.2 billion of the world’s population doesn’t have access to reliable electricity, and 400 million of these people live in India. Hande, who jokes that while growing up, his bread and butter came from a coal-fired plant in Rourkela (his father worked in power distribution at the Steel Authority of India), understood early that coal and gas wouldn’t be enough to meet India’s growing energy needs.

Yet, as an energy engineering student at the Indian Institute of Technology, Kharagpur, and a doctoral student at the University of Massachusetts, US, Hande’s interest in solar was restricted to its supply security dynamic (the sun as a source of energy is limitless) and its environmental impact. Until a visit to the Dominican Republic in 1991 taught him a new lesson in thermodynamics. He saw the poor paying for solar lights and realized that renewable energy could be a catalyst for social change. So he spent the next two years in Sri Lanka and India—in darkness.

He took time off to see how communities in both these countries lived without electricity. “I realized I didn’t know what happens after 6pm. We were just making decisions based on Excel sheets,” he says. He learnt a few things: The moment you don’t know a language (Sinhalese), the artificial hierarchies of a formal education crumble and you are treated like anyone else; none of his formal education was useful, except perhaps the confidence he had gained by living in a hostel. In Sri Lanka especially, communities came together after dark, usually in Buddhist temples, to vent their frustrations; in India, the lost time was usually spent in isolation and the kerosene lamp made people even more depressed. “It was my most efficient period of time, I joke,” he says. That’s also probably when he realized that the poor don’t want sympathy. They want partners and collaborators.

He worries about the hierarchies he believes English-speaking India imposes on the rest of the country. He knows he may not be able to influence the thinking of a top dog at a Bangalore-based research firm who asks him how he ever manages to have “intellectual discussions” in rural India. Or the suit who eagerly shares that his children “teach” their rural counterparts every weekend. But he hopes he can someday convince urban children to partner with fellow Indians who don’t speak their lingo. “How do I tell kids that we are all part of the same society? That they need to learn from each other to create some sort of social equity? How to make kids interested in solving problems?”

Selco gets hundreds of internship applications from masters’ and PhD students every year but very few are Indians. Of the 300 applications last year, five were from this country. “I’ve now resorted to guilt-tripping parents and students when I speak to them. In the next 10 years if you complain that Americans and Europeans know more about India than you do, then you are to blame, I tell them,” Hande says

“How do I tell kids that we are all part of the same society? That they need to learn from each other to create some sort of social equity?”

At Selco at least, they try to break these barriers. Nearly 85% of Selco’s employees, including chief operating officer Mohan Hegde (a practising folk artist on weekends), come from rural India. Hegde and K. Revathi, president, have been running the company since 1 June when Hande retired as managing director to take charge of the Selco Foundation, the company’s think tank. All the brainstorming for solutions and innovations to help fight poverty takes place at the foundation. The business side executes the ideas and the company’s incubation cell teaches entrepreneurs how to replicate these successes across India (four projects are already under way in Manipur, Rajasthan, West Bengal and Madhya Pradesh; Selco is helping 25 more entrepreneurs raise funds).

Formal qualifications are not a prerequisite for any job at Selco. Twenty-eight-year-old Raghu, who greets me when I arrive and gets us tea at the Selco office in Bangalore, started out as a driver and now handles administrative duties. “He’s going to be a branch manager by the time he’s 32. That’s our goal for him,” says Hande. In rural areas they joke about Selco’s hires: Are you part of the laptop or the non-laptop crowd?

Hande checks all the boxes of someone who truly believes in sustainability. He doesn’t own any asset, he says he has about three-four pants and shirts, he borrows his father’s 1994 Maruti 800 when he needs a car, and his daughter Adhishri was 8 when she first started saying: “Is it needed or is it wanted?”

He got his cues from mentors like Neville Williams, his co-founder and a solar energy pioneer who made it to the CIA watch list after a trip to Vietnam to protest the “American War”; from photographer Jon Naar, who was a British spy in World War II; and from Paul Maycock, who predicted way back that the cost of producing solar energy would plunge by 2015. “These are guys who talked about sustainability in a very different manner. I miss their passion. Now you go to a meeting and it’s all about ties and suits.”

Hande sees the poor as asset creators, and not as a bottom of the pyramid sales opportunity. “Don’t sell to the poor. That’s our fundamental rule. And if you’re selling to the poor, make sure that the value you’re giving to the poor is much more than the monetary value they give you back,” he says.

So when Selco representatives found that 32 Sidi families in rural Karnataka spent more money annually on candles, kerosene and to charge their mobile phones than it would cost to set up a simple solar system, they had to fix this. No bank was willing to lend the money to these families, so Selco offered a 100% guarantee on their behalf. Six months later, the bank reduced this guarantee to 20% as the payments were regular. “The best response was from the Sidis,” says Hande. “They said, light is great but once the solar loan is done, I will take a loan for a sewing machine.” They had become bankable.

Acknowledgement: Mr. Harish Hande

This article was published in livemint August 2014 (www.livemint.com)

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

Looking for more info on Kaizen/Lean/Operational Excellence? Click here


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Clean India Movement & 5S

If there is a ranking of countries in respect of observance of STANDARDS of sanitation and hygiene, one can be sure that India would figure close to the bottom. Some time ago, a British MP, Lucy Ivimy, was reported to have said that Indians did not know how to dispose of their rubbish and are congenital litterbugs.

From time to time, in their unguarded moments, highly placed persons in advanced industrial countries have burst out against Indians for being filthy and dirty in their ways of life. A majority of visitors to India from those countries complain of “Delhi belly” within a few hours of arrival, and some fall seriously ill.

There is no point in getting infuriated or defensive about this. The general lack of cleanliness and hygiene hits the eye wherever one goes in India — hotels, hospitals, households, workplaces, railway stations, trains, airplanes and, yes, temples. Indians think nothing of spitting whenever they like and wherever they choose, and living in surroundings which they themselves make unlivable by their dirty habits. (Source: The Hindu Businessline)

“5S” is a reference to five words starting with letter S, for the basic elements of this system. Seiri (Sort), Seiton (Set in Order), Seiso (Shine), Seiketsu (Standardize) and Shitsuke (Self-discipline). One can also term these are 5 pillars of self organization or an effective workplace. We term it pillar because it supports the improvement structure. 5S is the starting point for any Continuous Improvement initiative. It is the DNA.

The 5S approach is universal and simple. The principle is same whether you apply this in a Foundry or in a Hospital. Without practising 5S, one cannot do quick changeovers, cannot maintain Just-in-time inventory system, or cannot practice Autonomous Maintenance.

The general myth pertaining to 5S is that 5S is practised only to give a cosmetic up-lift to the workplace. 5S is more than a good looking place. With changing demands of customers, one is forced to find new ways to ensure survival. To do this, a change in the mind-set or shift in paradigm is essential. A change in mind-set is influenced by the change in the physical environment. Thus, 5S facilitates the shift in the paradigms and paves way for improvement. 5S also creates an awareness of Non-value adding activities present in the processes.

Another myth is 5S is a step-by-step methodology. But, this is not! All the 5 pillars are to be practised together and not in isolation. One can observe that the first 3 pillars are Gemba oriented. However, without Standardization and Self-discipline, no Continuous Improvement Initiative would sustain.

Gandhiji


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Blue Ocean Leadership : Part III of III

Execution Is Built into the Four Steps

Any change initiative faces skepticism. Think of it as the “bend over—here it comes again” syndrome. While blue ocean leadership also meets such a reaction initially, it counters it by building good execution into the process. The four steps are founded on the principles of fair process: engagement, explanation, and expectation clarity. The power of these principles cannot be overstated, and we have written extensively about their impact on the quality of execution for over 20 years. (See, for example, our article “Fair Process: Managing in the Knowledge Economy,” HBR July–August 1997.)

Blue ocen leadership

In the leadership development context, the application of fair process achieves buy-in and ownership of the to-be Leadership Profiles and builds trust, preparing the ground for implementation. The principles are applied in a number of ways, with the most important practices being:

  • Respected senior managers spearhead the process. Their engagement is not ceremonial; they conduct interviews and draw the canvases. This strongly signals the importance of the initiative, which makes people at all levels feel respected and gives senior managers a visceral sense of what actions are needed to create a step change in leadership performance. Here’s a typical employee reaction: “At first, I thought this was just one of those initiatives where management loves to talk about the need for change but then essentially goes back to doing what they’ve always done. But when I saw that leading senior managers were driving the process and rolling up their sleeves to push the change, I thought to myself, ‘Hmm…they may just finally mean it.’”
  • People are engaged in defining what leaders should do. Since the to-be profiles are generated with the employees’ own input, people have confidence in the changes made. The process also makes them feel more deeply engaged with their leaders, because they have greater ownership of what their leaders are doing. Here’s what people told us: “Senior management said they were going to come and talk to people at all levels to understand what we need our leaders to do and not do, so we could thrive. And I thought, ‘I’ll believe it when someone comes knocking on my door.’ And then they knocked.”
  • People at all levels have a say in the final decision. A slice of the organization across the three management levels gets to vote in selecting the new Leadership Profiles. Though the top managers have the final say on the to-be profiles and may not choose those with the most votes, they are required to provide a clear, sound explanation for their decisions in front of all attendees. Here’s some typical feedback: “The doubts we had that our comments were just paid lip service to were dispelled when we saw how our inputs were figured into the to-be profiles. We realized then that our voices were heard.”
  • It’s easy to assess whether expectations are being met. Clarity about what needs to change to move from the as-is to the to-be Leadership Profiles makes it simple to monitor progress. The monthly review meetings between leaders and their direct reports help the organization check whether it’s making headway. We’ve found that those meetings keep leaders honest, motivate them to continue with change, and build confidence in both the process and the sincerity of the leaders. By collecting feedback from those meetings, top management can assess how rapidly leaders are making the shift from their as-is to their to-be Leadership Profiles, which becomes a key input in annual performance evaluations. This is what people say: “With the one-page visual of our old and new Leadership Profiles, we can easily track the progress in moving from the old to the new. In it, everyone can see with clarity precisely where we are in closing the gap.”

Essentially, the gift that fair process confers is trust and, hence, voluntary cooperation, a quality vital to the leader-follower relationship. Anyone who has ever worked in an organization understands how important trust is. If you trust the process and the people you work for, you’re willing to go the extra mile and give your best. If you don’t trust them, you’ll stick to the letter of the law that binds your contract with the organization and devote your energy to protecting your position and fighting over turf rather than to winning customers and creating value. Not only will your abilities be wasted, but they will often work against your organization’s performance.

Becoming a Blue Ocean Leader

We never cease to be amazed by the talent and energy we see in the organizations we study. Sadly, we are equally amazed by how much of it is squandered by poor leadership. Blue ocean leadership can help put an end to that.

The Leadership Canvases give people a concrete, visual framework in which they can surface and discuss the improvements leaders need to make. The fairness of the process makes the implementation and monitoring of those changes far easier than in traditional top-down approaches. Moreover, blue ocean leadership achieves a transformation with less time and effort, because leaders are not trying to alter who they are and break the habits of a lifetime. They are simply changing the tasks they carry out. Better yet, one of the strengths of blue ocean leadership is its scalability. You don’t have to wait for your company’s top leadership to launch this process. Whatever management level you belong to, you can awaken the sleeping potential of your people by taking them through the four steps.

Are you ready to be a blue ocean leader?

Acknowledgement: By Chan Kim, Renee Mauborgne

This article was published in Harvard Business Review May 2014

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

Looking for more info on Kaizen/Lean/Operational Excellence? Click here


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IndiZEN – 6th National Convention on Operational Excellence

India has a great diversity in the maturity levels within different industries. There are certain industries which are mature and many are still at the stage where they are driving Operational Excellence (OE) in bits & pieces. In a way they are driving OE or continual improvements, but they are not really driving them in a way it should be.

indizen2014-title-v1

Too often the greatest challenge faced by the Operational Excellence Managers is “Sustaining Change”. This happens because of lack of focus on Daily Work Management practices or SDCA approach or misunderstandings or general resistance to change. It is not unusual for improvement efforts to disappear.  Therefore sustaining change or operational excellence plays a crucial role in Continual Improvement journey. Leaders at every level in the organization must continue to demonstrate their commitment & visible leadership to sustain change so that whatever improvements happen do not disappear.

We present & invite you to IndiZEN 2015, 6th National Convention on Operational Excellence where you can Learn more about the “Sustained Operational Excellence – Key to Long Term Success of ‘Make In India”, Share your learnings & experience & Network with like minded people. IndiZEN 2015 is going to be the place to learn about the ways to sustain operational excellence. You will gain insights on how you can become an active learning organization and build the capability of your people by engaging their hearts & minds.

Block your dates, be there to learn & find the real key to Sustainability.

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

Looking for more info on Kaizen/Lean/Operational Excellence? Click here