Stories from My Sensei: Two Decades of Lessons Learned

Implementing Toyota -Style Systems

Steve Hoeft , Altarum Institute

Lean Six Sigma and Process Improvement in Healthcare Summit

March 14, 2010

Steve Hoeft: Brief Bio

Lean!

� 26 years of experience: Lean enterprise, quality, continuous improvement efforts; plus facility design, simulation and scheduling

� Delta (Kogyo) USA – lean supplier to Mazda (Sensei: Joe Shimada)� Johnson Controls – developed internal Lean Office:

• Studied lean principles directly from Toyota in KY (with Sensei)

• Co-authored JCI Manufacturing System (ASTD Award winner)

� Lean Enterprise coach (8 years):• Over 250 Lean events; developed hundreds of successful Lean Facilitators

• Helped establish Value Stream Visions with auto firms, JCI, PPG, Framatome (nuclear fuel),

Landing Gear supply chain

� Altarum Institute (since Feb 2003):• Lean Six Sigma for Healthcare: Scott & White, Memorial Sloan-Kettering Cancer Center,

William Beaumont, Veteran's Health Administration (VHA), University of Michigan Healthcare

System, St. John's (IL) and the entire Hospital Sisters Health System, Blue Cross Blue Shield,

Henry Ford Health System, Univ. Health System-San Antonio, Yale New Haven Health, Ontario

Health Quality Council, Vancouver Coastal, Kaiser Permanente, Tri-City Medical Center, Lakewood Health System, hospitals in Singapore, and others

• Major Government transformation projects:

Military: OSD, Air Force-wide, Repair & Base Ops, Lean Purchasing- PSCM

Healthcare: AF SG, VHA

** Principal Instructor for the University of Michigan’s Lean Manufacturing, New Product Design and Healthcare Certificate programs

3

“The Big Lie”, Story #6 (pg. 35)

“…automation applied to an inefficient operation will magnify the inefficiency.” Bill Gates

“Work expands so as to fill the time available for its completion.” C. Northcote Parkinson, 1958

“Everything expands to fill all available time, space, etc. (Just look at your garage.) So, don’t allow it.” Steve

“Put a good person in a bad system and the bad system wins, no contest.” W. Edwards Deming (also in Stories from My Sensei)

4

Leadership Lessons ( Hansei)

• Communication ! (7x)

• Find teachers whose learning curve we can borrow (avoid the bear traps)

• …

5

Typical Results▲25-55% Cost Reduction▲60-90% Throughput Increase▲50-90% Less Errors▲60-90% Inventory Reduction▲35-50% Space Reduction▲50-90% Lead Time Reduction▲45-75% Direct Labor/Productivity �▲Greatly Improved MoraleNOTE: Requires full implementation. Actual results vary by process

and situation.

Going Lean in Health Care, Jim Womack et al, Inst. for Healthcare Improvement, 2005

6

is a process improvement philosophy which shortens the time between start and end by eliminating sources of waste.

Lean Production

Business as Usual

END PROCESSEND PROCESSSTART PROCESSSTART PROCESS

Time

Waste

END PROCESSEND PROCESSSTART PROCESSSTART PROCESS

Time (Shorter)

Waste

Lean Production

7

Lead Time & Value Added

� Value Added Time is only a very small percentage of the Leadtime

� Traditional Cost Saving efforts focused only on Value Added Items

� LEAN THINKING FOCUSES ON NON-VALUE ADDING ITEMS

TimeStart Finish

= ValueAdded Time

= Non-ValueAdded Time(WASTE)

WaitingWaitMove Wait Move &

Out-process

Diagnose Test

TreatTriage

Move

8

Time

Time

Focused on Non-Value Adding Items

Large Amount of Time Eliminated

Time

Time

Traditional Improvement Results

Small Amount of Time Eliminated

Lean Results

Traditional vs. Lean Results

9

Exploitation vs. Better Way to Work

1. Exploitation

2. Better Wayto Work

We ChooseOption 2

Value AddedWork

© 1995 S. Hoeft

Flexible, Capable,Highly Motivated

People

Just in Time“right part, time, amount”

* Flow where you can* Pull where you must

• Cells• Kanban• Quick Setup• Level Production• Takt Time

Built-in Quality

“Never pass bad parts to the next process”

* Make problems visible* Andon-Stop the Line

Authority

• Problem Solving• Error Proofing• Visual Controls• Person-Machine

Separation (Jidoka)

Highest Quality, Lowest Cost, Best DeliveryGuaranteed through shortening lead time by eliminating waste

UnwaveringPrinciples

TailorableTools

Foundation of Operational StabilityStandardized Work Robust Products & Processes

Preventive Maintenance* Kaizen Early Supplier InvolvementVisual ManagementWaste EliminationPDCA-Scientific Method

UnwaveringPrinciples

Respect for Workers

The Toyota House Model:Timeless, Unchanging Principles vs. Tools

You Will Fail, Story #26

11

“Don’t Just DO Something, Stand There!” Get perspective and reflect rather than just continuing to do the same thing.”

~Dr. Scott Simmerman (www.squarewheels.com)

“Stand in Circle ”, Story #9 (pg. 44)

12

"Managers will try anything easy that doesn’t work before they will try anything hard that doeswork." ~Jim Womack

“Where is Factory? ”, Story #33 (pg. 70)

13

"I have been impressed with the urgency of doing. Knowing is not enough; we must apply. Being willing is not enough; we must do." ~Leonardo da Vinci

“Must Cut Inventory in Half? ”, Story #34 (pg. 74)

A Bias for Action!

14

A Bias for Action!

“Door Here!”, Story #35 (pg. 76)

15

Leadership Lessons

• x

• …

16

“These Always Lie ”, Story #10 (pg. 49)

“A desk is a dangerous place from which to view the world.” ~Adapted from John Le Carre

"We are what we repeatedly do. Excellence, then, is not an act, but habit." ~Aristotle

17

Leadership Lessons• Try this next time someone says they need more resources (e.g., no

room). Say, “Let’s go and see!”• For those that actually did this, what did you learn?

• How many of your managers and leaders could survive a “point test”? If you asked them to point to the value-adding persons that they directly support, could they do it? If you then asked these workers how many hours per day (if any) this manager or leader visibly supports them, what would they say? Can they survive the point test? Can you?

• Where should the offices of managers who directly support production be located?

• In the eyes of your supervisors and leaders, how can you increase the priority of the gemba—the place where work occurs?

From: Stories from My Sensei, pg. 51

18

Bonus Story: “What You Measure is What You Get – So Be Careful What You Measure!”

• Related to “Body Audits and Layered Audits”, Story #40 (pg. 139)

In Process Project “Results Board” ( Huddle Spot)

Tracking Chart for Goal #1

Tracking Chart for Goal #2

Tracking Chart for Goal #3

Tracking Chart for Goal #4

Action Plan to Achieve

Goal #1

Action Plan to Achieve

Goal #2

Action Plan to Achieve

Goal #3

Action Plan to Achieve

Goal #4

Owner!

Last Update: May 2009 Results Board Owner: {Sponsor}

20

Leadership Lessons

• x

• …

21

A Few Next Steps (Use Lean Principles)

▲ Find Sensei’s (teachers whose learning curve you can borrow)

▲ Establish training schedule for leaders

– Develop Common language; Ask “What’s the Plan, Stan?” (Goals)

▲ Identify 2010 goals for performance improvement:

– Access, Quality, Productivity, Floorspace, Idea Generation (Plan?)

▲ Assemble your Lean Leadership Council (eVSM)

▲ Prioritize 2010 Lean Projects (~2 in every major Value Stream)

▲ Establish embedded Lean experts/facilitators in major department

▲Develop Problem Solving expertise (A3 tool) for front line “spot”improvements, and also to develop Lean Thinking leaders