The Power of Why

NUMMI Tour Tale #3: The Power of Why by Mark Graban:

Again, another "wow" moment. For one, NUMMI put the situation in customer terms. Do not use these parts, because there would be a negative impact on the customer. It didn't say "do not use the parts because I say so (and you wouldn't understand the reason anyway)".
...
Why are we doing lean? Why is it necessary to standardize our workbenches? Why is it important to get these parts off MRP and onto a kanban system? I bet we would all do better by taking the time to explain why.

The Toyota Phenomenon

The Toyota Phenomenon by Ernst Glauser:

Toyota's success starts with its brilliant production engineering, which puts quality control in the hands of the line workers who have the power to stop the line or summon help the moment something goes wrong.

Walk into a Toyota factory in Japan or America, Derby in Britain or Valenciennes in France and you will see the same visual displays telling you everything that is going on. You will also hear the samejingles at the various work stations telling you a model is being changed, an operation has been completed or a brief halt called.

Everything is minutely synchronized; the work goes at the same steady cadence of one car a minute rolling off the final assembly line. Each operation along the way takes that time.

Shoichiro Toyoda, Honorary Chairman and director of Toyota Motor Corp.: “There is not a day I don't think about what Dr. Deming meant to us. Deming is the core of our management.”

Deming Review Postcasts

Postcast on W. Edwards Deming by Paul C. Palmes.

This is the first of three programs dedicated to the teachings of W. Edwards Deming. The Internet has numerous websites devoted to his thoughts and methods. I strongly suggest that you avail yourself of many of these offerings if this and programs that follow stir your interest

As I mentioned previous I see potential for podcasts as another tool to improve learning of management ideas:

• BetterProcess Podcasts and Blog
• Malcolm Gladwell - Synchronicity

Toyota Manufactures More Itself

Bucking the trend, Toyota controls quality, cost by making many parts in house, AutoWeek via Lean Manufacturing Blog:

On one hand, the company sees parts making as a critical piece of its overall quality-control program. Toyota argues that keeping some parts in-house actually makes it more efficient. Outsourcing parts simply to meet the changing industry norm is viewed warily by Toyota executives.

"I don't believe we can outsource our responsibility to the customer," Seizo Okamoto

Toyota spent 27.90 hours of labor to stamp and assemble its vehicles and powertrains in North America, compared with 29.43 hours at No. 2 Nissan North America Inc., and 34.33 hours for GM, the most efficient of the Big 3.

Based on these figures, GM uses 23% more labor per car than Toyota.

Toyota is simply following a different model, says Dave Cole, chairman of the Center for Automotive Research in Ann Arbor.

"There isn't one magical business formula in the auto industry," Cole says. "Vertical integration works for Toyota. It doesn't work so well for the others."

Do the others have any business formula that is working well?

Mark Graban, Lean Manaufacting Blog:

This article eventually reaches the conclusion I jumped to early on. Of course Toyota doesn't outsource as much as the other automakers. Toyota's own internal production can be cheaper and with better quality, I assume, than their suppliers.

New Business Ideas Take Time

New Business Ideas Take Time by Edward DeBono

Some types of change carry more immediate benefits, such as problem-solving. The problem is disrupting a system or individuals, so solving that problem is of instant benefit. Even in cases where the benefits are not immediate, they can be predicted easily.

Because of this, management thinking is too preoccupied with problem-solving.

Good point. This is true for at least too reasons: short term thinking and the desire to have a measure of success. It is much easier to find a measurement of the benefit of eliminating some problem than the benefits of learning and taking more time to think. As Lloyd S. Nelson said many of "the most important figures that one needs for management are unknown or unknowable."

All businesses should appoint a 'Simplicity Officer'. This person should encourage and refine business ideas for the simplifying of processes. Simplicity requires a deliberate effort as continuity is the natural instinct of organisations.

Sounds very much like lean thinking to me.

The Power of Teams

The Power of Teams, by Lynn Witten:

Train team leaders and members. It is critical to provide training and guidance to people on how to function as effective team members and leaders. In addition, problem-solving training can give teams and team leaders a structured approach to finding solutions. It can help teams overcome members' natural defensiveness and finger-pointing.

Evaluate incentive systems. Many incentive systems have been established to reward individual effort or effort from one functional area. In team-based systems, rewards need to recognize the impact of a team's performance on the whole system.

Lean Principles in Health Care

"Lean" principles apply to health care, by Donna Daniel:

Making the shift to a lean enterprise, whether it's in a hospital, a physician practice or a nursing home, isn't easy. Like any culture shift, it will require commitment and time. There may be resistance, especially given the complex nature of health care. But stay the course.

Lean has a successful track record in many industries so you will need to provide education, communication and reinforcement throughout the process. Lean may be challenging to implement at first, but it may be the best investment your organization can make to improve financial performance and the quality of care you deliver to your most important customers -- your patients.

Prevoius related posts:

• Management Improvement in Healthcare
• Seven Leadership Leverage Points
• Going Lean in Health Care
• Saving Lives: US Health Care Improvement

Health Care Improvement Articles

Go Lean to Remain Competitive

Go Lean to Remain Competitive:

Captains of industry should adopt Lean Production Systems, an idea {conceived} by Toyota for its car-making, to transform their plants to efficient ones, for survival in the globalisation era

Sundaram Clayton Limited Brakes Division President C N Prasa.

In 1998 the SCL Brakes Division won the Deming Prize and in 2002 they won the Japan Quality Medal.

Sundaram-Clayton Limited, Mission:

We are committed to being a profitable and socially responsible leading manufacturer of environmentally friendly auto components and sub-systems for customers in markets and to provide fulfillment and prosperity for customers, employees and suppliers.

India has been represented very well among Deming Prize winners the last few years including 3 of 4 winners this year.

I think it will be interesting to see if this is a sign of a broader adoption of such management principles in India. If so, I think that would compliment the software industry in promoting continued economic development in India quite well. And, if so, in 10 years I think we will be hearing much more about manufacturing in India than we do today.

More articles on Management Improvement in India (including several on Sundaram Clayton Limited).

Lean Development

Lean Development, by Freddy Ballé and Michael Ballé. Great article.

According to a National Center for Manufacturing Sciences report, Toyota product development projects can take half the time of US equivalents, with four times their productivity (150 product engineers utilised by Toyota per car programme versus 600 for twice as long at Chrysler).

As with implementing the Toyota production system, a more precise understanding of development practices doesn'’t necessarily help to improve the efficiency of engineering projects for a number of reasons. First, it is not a collection of best practices which can be implemented piecemeal, but a system. Furthermore, a clearer understanding of the system also shines a different light on the practices themselves, and, in many cases, changes their intended purpose. As such, many of the Toyota practices only make sense in the light of the overall system.

Great point. It would be wonderful if more people could learn this.

Types of Pull Systems

Pull Systems Must Fit Your Production Needs:

Mixed Supermarket and Sequential Pull System
The supermarket and sequential pull systems may be used together in a mixed system, also known as a C-type pull system. A mixed system may be appropriate when the 80/20 rule applies, with a small percentage of part numbers (perhaps 20%) accounting for the majority (perhaps 80%) of daily production volume. Often an analysis is performed to segment part numbers by volume into (A) high, (B) medium, (C) low, and (D) infrequent orders. Type D may represent special order or service parts. To handle these low-running items, a special type D kanban may be created to represent not a specific part number but rather an amount of capacity. The sequence of production for the type D products is then determined by the method the scheduling department uses for sequential pull system part numbers.

Statistical and Scientifc Thinking Blog

Another good new blog on Statistical and Scientifc Thinking that is discusses the application of Deming's ideas, by John Dowd. Short quotes from two posts:

The predictions made on the job are usually a lot less obvious and in most cases managers may not even be aware of the fact that they are making predictions. For example, much of management time is spent reacting to events. Some problem takes place and it’s management’s job to fix it. Some process of assessment is done and then a ‘corrective action plan’ is put into place.

So where’s the prediction.The plan is the prediction. The plan is developed in the hope if carried out in the proper way, some desirable result will occur that will eliminate the problem, solve it, or whatever. That plan is picked (one would hope) as being the one most likely to bring about the desired outcome.

Shewhart went at the problem a different way. He was trying to determine what the characteristics of process behavior were and began studying the output of different types of systems to see what happened. Knowing that the variability of processes took place over time, he began plotting time-series charts (sometimes called Run Charts) to see what patterns of the variation looked like.

Previous Curious Cat posts on similar topics:

• Management is Prediction
• Operational Definitions and Data
  

Improvement at UTC

Mike Beck gave an excellent presentation at the Deming Institute conference about the United Technology Corporation management improvement system. I plan on posting more about the session. But for now, here is article that has some details on what UTC has done.

The Unsung CEO, Business Week, cover story Oct, 2004:

David has racked up these results despite his penchant for controversial investments that don't directly benefit the bottom line, at least not within any normal time horizon. His Employee Scholar Program costs a cool $60 million a year, and workers don't even have to tie their studies to the job. Anything goes, from medieval poetry to medical training, with UTC picking up the tab, including the cost of books and time off.
...
The program covers every employee, from the veteran elevator technician in Zimbabwe to a fresh-scrubbed office assistant in Tyler, Tex., with some education benefits even extending to laid-off workers. And, for each degree earned, employees get up to $10,000 in UTC stock or options.

Dr. Deming advocated such a commitment to education. I don't know of any company putting this much money behind the concept.

David leaned on Ito, first as a consultant and then as a full-time adviser, to make the techniques he used to analyze the elevators adaptable and accessible to every person in the plant. The program evolved and became known as ACE, or Achieving Competitive Excellence. Instead of the complex formulas and training schedules involved with, say, Six Sigma -- where the process of becoming a master black belt can generate more sweat and angst than pursuing an actual master's degree -- "ACE pilots" are production line workers who learn the quality process in a matter of days. They learn to pinpoint problems ranging from fundamental design flaws such as misplaced bolts to a co-worker's fatigue from staying up with a newborn all night.

One recent result: more logical placement of elevator parts -- using special boxes instead of loose bags -- that trims $300 off the cost of each elevator and will lead to $26.4 million in savings worldwide this year. More important, the factory floor was reconfigured so that the production process was compact -- requiring fewer steps, less reaching, and easier access to parts -- as well as more intuitive. There are even taped outlines on floors and surfaces, much like the outlines of bodies at crime sites, to show exactly where each widget should go. This is the "5-S" strategy -- sort, straighten, standardize, sustain, and shine.

Eliminating Complexity from Work

Eliminating Complexity from Work: Improving Productivity by Enhancing Quality by F. Timothy Fuller. National Productivity Review, Autumn, 1985. A case study of a process improvement from 1985.

as much as half of the activities of about sixty people had been to set up and take down jobs, expedite, move material, count material, and do other tasks that were unnecessary in the new process.

What's Holding Back Lean?

What's Holding Back Lean? by Lauren Gibbons Paul (via Got Boondoggle - another new Lean blog):

2. A short-sighted focus on cost reduction

Responding to profit imperatives, many companies are concentrating only on reducing costs rather than looking to lean as a source of greater efficiencies
...
3. Emphasis on imagery rather than real work

Compared to their Japanese peers, U.S. management is too focused on the trappings of a lean initiative, such as slogans, launch parties and classes, rather than rolling up their sleeves and figuring out how to improve actual processes, says Womack.

After reading the articles take a new look at Deming's 14 Obligations of Management. There is quite a bit of similarity.

The Best Factory in the World

The Best Factory in the World by Norman Bodek (from his book, Kaikaku):

This is a story about a time when Bodek asked Shigeo Shingo to take him to the "very best factory in all of Japan."
...
Pictures of areas of the factory or the office hung throughout the plant. Workers were encouraged to look at the pictures and talk about them together, then to make improvements.
...
After the visit, I could understand better how it is possible to have a super-efficient manufacturing plant where people's needs for growth, respect and creativity are also met.

Another excellent article from Superfactory.

New IT Lean Blog

A new Lean Blog, Compound Thinking, focuses on Information Technology. It has started off with some interesting posts, including - Compound Thinking: Lean Manufacturing Principles -- Trust the Team:

If you aren't trusting your people, you are slowly but surely sapping their morale. Even worse, you are cutting yourself from the source of real ground-floor process innovation.

Hopefully this blog will continue to offer interesting posts.

Six Keys to Building New Markets by Unleashing Disruptive Innovation

Six Keys to Building New Markets by Unleashing Disruptive Innovation by Clayton M. Christensen, Michael E. Raynor, and Scott D. Anthony in Harvard Management Update:

Companies have two basic options when they seek to build new-growth businesses. They can try to take an existing market from an entrenched competitor with sustaining innovations. Or they can try to take on a competitor with disruptive innovations that either create new markets or take root among an incumbent's worst customers. Our research overwhelmingly suggests that companies should seek out growth based on disruption.

Clayton Christensen has put forth this position in several of his books including the Innovator's Solution.

Managers typically grow impatient when we tell them this. "Theory?" they say. "That sounds like theoretical. That sounds like impractical." But theory is eminently practical. Managers are the world's most voracious consumers of theory. Every plan a manager makes, every action a manager takes, is based on some implicit understanding of what causes what and why.

The problem is, managers all too frequently use a one-size-fits-all theory. But the ground beneath them inevitably shifts. Strategies that worked so wonderfully in the past no longer suffice.

Very well put in my opinion. Unfortunately we do not often stop to examine the theory and therefore fail to learn as we should as we experiment and get new results. The most effective way I know of to improve the learning is to use the PDSA cycle, predict the effects of change and then examining the results of change. As simple as those two acts are, they are skipped far to frequently.

His second point, that managers frequently use overly simplistic models or theories is also important. Management is not well suited for simple theories that can be applied in any situation. Many interdependent variables are often at play and management requires not application of simple rules but applying knowledge in complex situations as best you can. Management is challenging and simple answers are often of little value - even though they are desired.

It seems like Harvard has taken to making enough content from articles available for free (or maybe they have for awhile and I just am finding them more often now...) and then charging for the full article. I think it is wise to make a large enough portion of the article that readers can find it useful, and then charge for more (if charging for articles is your business model). They really should explain what you are buying though. I can't tell if there is more to the article than is on the web site (if they make available 2 pages of 5 pages they should state that clearly). It should be clear to the customer what they are buying.

BetterProcess Podcasts and Blog

BetterProcess Podcast and Blog

I found a new source of podcasts focused on manufacturing, charting, use of data and the like. Yesterday I wrote about the potential for webinars and last week I wrote about the value of podcasts to the transfer of management improvement knowledge. The biggest problem right now is finding management improvement podcasts so I am glad to find another source of podcasts on management improvement topics.

Topics of the podcasts include: Pareto charting, P-charting, Six Sigma (Measurement System Analysis) and manufacturing news.

All the podcasts end with a musical selection. This new technology allows individuals to create what they want. So we get a much more personal creations than were common in the past. I can't imagine many video training sessions each ending in a musical selection. It also is made possible by thinking like that of the creative commons license (that allowing more use of your content may actual be wiser, in some cases, than prohibiting any use of content that you own).

The most recent podcast is part 2 of 2 (and the 12th podcast overall): an interview with Andy Sleeper a Master Black Belt discussing Measurement System Analysis.

Seven Leadership Leverage Points

Seven Leadership Leverage Points: for Organization-Level Improvement in Health Care by James L. Reinertsen, MD; Michael D. Pugh and Maureen Bisognano.

If leaders are to bring about system-level performance improvement, they must channel attention to and take action regarding several, if not all, of these leverage points. In other words, this set of leverage points is not offered as a tried-and-true method, but as a theory-one that we hope will be useful for individual leaders in planning their work and for us in organizing a support and learning system to share best leadership practices and results across organizations; and from which all of us can learn about what works, and what doesn't, in bringing about large-system change in health care.

Once again the Institute for Healthcare Improvement (IHI) is doing a great job. This white paper does an excellent job of collecting knowledge and suggesting a way forward. And they are having an impact by getting people to participate in improvement efforts.

They have the courage to say one of the 3 sources for there hypothesis as "Hunches, Intuition, and Collective Experience." While attempting to base plans on data and not hunches is good. Often you must make decisions without data. It is why Dr. Deming was so concerned with mobility of top management: that mobility means many managers don't really understand what they are managing. Lean thinkers understand the value of having managers with deep knowledge of the areas they manage.

The leverage points are not a substitute for a coherent quality method such as the Toyota Production System or the Model for Improvement. In fact, the organizations in which the leverage points would be applied are assumed to have adopted a coherent quality framework.

You can see why I like IHI. They don't try to sell quick fixes. The are interested in achieving extremely significant results that continue into the future.

While this white paper is very focused on health care I find the IHI material is also great for those not working in health care. The material shows how management improvement concepts can be applied to address large systems and it is thoughtful and presented well.

More articles on improving health care

Shackled by Bad Six Sigma?

Shackled by Bad Six Sigma? by Fred Mullavey, Quality Digest:

Technical experts, customers and suppliers--both internal and external--all need to be involved, regardless of their department or discipline. When boundaries aren't crossed in this manner, problems remain entrenched, and the Six Sigma effort fails.

Lean Consumption: the Customer's Perspective

Lean Consumption: Defining Value from the Customer's Perspective, AutoAsia magazine.

The recently released, Lean Solutions, as well as, The Toyota Way Fieldbook, are required reading for anyone serious about applying lean concepts. And truly both should be read by anyone interested in management improvement (even those who are not lean experts or even that familiar with lean ideas).

A short portion of the full article (exploring the ideas James Womack and Daniel Jones write about in their new book) is available online (without subscription). The short abstract packs in all sorts of good info. The new book, Lean Solutions: How Companies and Customers Can Create Value and Wealth Together by James P. Womack, Daniel T. Jones is no doubt the catalyst behind this article. From the article:

The concepts underlying lean consumption boil down to six simple principles that correspond closely with those of lean production.

1. Solve the customer's problem completely by making sure that all the goods and services work together to do so.
   
2. Don't waste the customer's (or the provider's) time.
   
3. Provide exactly what the customer wants.
   
4. Provide value where it's wanted.
   
5. Provide value when it's wanted.
6. Continually aggregate solutions to reduce the customer's time and hassle.

For those interested in reading up on lean thinking concepts we have gathered links to lean articles available online.

The Quick Fix

The Fall 2005 issue of the Deming Institute newsletter includes a copy of a letter Dr. Deming sent to Time magazine in 1981.

Dear Sir,

Your article about Japan in TIME for 30 March 1981 is excellent, but the paragraph concerning my work is ridiculous and can do a lot of harm to American industry at the very time when they need guidance. Dr. Deming did not just give a lecture in 1950. He gave 35 lectures in the summer of 1950 to engineers and to top management. Six months later he was there again, and six months after that yet again. He has made 19 trips to Japan. One trouble with American industry today is that top management supposes that one lecture or one day will do it. “Come, spend a day with us, and do for us what you did for Japan, that we too may be saved.”

It is not so simple. Few people in top management in America understand their responsibilities and know that they must serve a life term on quality and productivity from now on, under competent leadership.

W. Edwards Deming

Many still search for simple quick answers. Management improvement most often requires a great deal of thought, study, experimentation and effort.

Innovation in Organizations

Assessing Your Organization's Innovation Capabilities by Clayton M. Christensen:

Three classes of factors affect what an organization can and cannot do: its resources, its processes, and its values. When asking what sorts of innovations their organizations are and are not likely to be able to implement successfully, managers can learn a lot about capabilities by sorting their answers into these three categories.

Innovation is one of the areas of management improvement that is not given sufficient attention. However, innovation is critical to the success of organizations and to the Deming management philosophy. Deming however, never had much specific advice on how to innovate. The management strategies he proposed do support innovation: truly knowing your customers, constancy of purpose, truly knowing your business, understanding your purpose, etc..

One of the most important findings in the research summarized in The Innovator's Dilemma relates to the differences in companies' track records at making effective use of sustaining and disruptive technologies.

I have been reading Clayton Christensen's books recently and his concepts of managing disruptive technology is very interesting.

Disruptive innovations, on the other hand, bring to market a new product or service that is actually worse along the metrics of performance most valued by mainstream customers. Charles Schwab's initial entry as a bare-bones discount broker was a disruptive innovation, relative to the offerings of full-service brokers. Early personal computers were a disruptive innovation, relative to mainframes and minicomputers. PCs were disruptive in that they didn't address the next-generation needs of leading customers in existing markets. They had other attributes, of course, that enabled new market applications to coalesce, however -- and from those new applications, the disruptive innovations improved so rapidly that they ultimately could address the needs of customers in the mainstream market as well.

Books by Clayton Christensen:

• The Innovators Dilemma
• The Innovators Solution
• Seeing What's Next: Using Theories of Innovation to Predict Industry Change
• Innovation and the General Manager

Education Improvement

Pattillo Tutors Granville School on Teaching Method by Natalie Jordan, Rocky Mount Telegram (North Carolina, USA):

The model uses a PDSA - plan, do, study and act - component. "Plan" clarifies the purpose; "do" is when an action plan is made and done; "study" involves analyzing results; and "act" is to make improvements.

Through core values and strategic categories, the model is improving the way teachers teach and students learn, Olmsted said.

Education is another area where applying management improvement concepts can be difficult. The Education area does require special care but management improvement concepts can work very well in Education.

David Langford has done some great work in this area. He wrote a book, Orchestrating Learning With Quality, which while I would definitely recommend it for anyone planning on applying these concepts, it does not really capture the power of his contributions in my opinion.

The Quality in Our Schools site (by Ivan Webb in Australia) also is a good resource.

• Quality Learning web sites
• K-12 (kindergarten though high school) quality improvement links
  

Management Improvement in Healthcare

Thinking out-of-the-box Helps Alexandra Hospital Reduce Patient Waiting Time, Singapore News, via Panta Rei.

Another example of lean principles being used by government:

When looking for solutions to cut patients' waiting time, Alexandra Hospital took an out-of-the-box approach and looked at a factory's production line. More specifically, the Toyota production line.
...
While a team of 12 staff used to screen 22 patients per hour, the same team can now screen 70 patients per hour - a 400-per-cent increase in productivity
...
This... is how hospitals should look for new ways to deliver better healthcare at a lower cost. To encourage this, the Ministry of Health has set up the Healthcare Quality Improvement Fund which will provide seed money to fund projects which would improve the quality of patient care.

What's so Bad about Assembly Line Healthcare?, Panta Rei:

I have to confess having much less success at persuading hospitals in the U.S. to take a serious look at TPS. People with the letters M.D. after their name are particularly resistant to being placed, or having their patients placed on any kind of "production line" healthcare.

Health care (and especially M.D.s) have always been seen as among the most difficult environment to introduce new management principles (universities are another). It was surprising to me since so much of management improvement is largely about using the scientific method, but it seems to be a reality. It seems these highly educated people are used to having huge freedom to act as they wish, and seem to resist participating in a system to improve rather than doing as they wish.

To improving results in health care I strongly recommend looking at the work of the Institute for Healthcare Improvement. They have an excellent article on lean, Going Lean in Health Care by James Womack et. al. (previous post on Going Lean in Health Care).

I also recommend the value of considering the experience of SSM Health Care. They were the first winner's of the Baldrige National Quality Award for Health Care. While not lean focused I think the trouble of getting doctors to consider management systems improvement would be very similar. I heard Sister Mary Jean Ryan, President-CEO speak at the Hunter Conference on Quality in 2000 and she seemed to really understand this issue and the need for systemic improvement.

The healthcare system is in need of improvement: USA Health Care Costs reach 15.3% of GDP - the highest percentage ever.

• Healthcare improvement links
• Articles on improving the health care system
• Previous Lean Government post
• Excessive Health Care Costs
  

Measuring and Managing Performance in Organizations

Forward (by Tom DeMarco and Timothy Lister) to Measuring and Managing Performance in Organizations:

measurement is almost always part of an effort to achieve some goal. You can't always measure all aspects of progress against the goal, so you settle for some surrogate parameter, one that seems to represent the goal closely and is simple enough to measure. So, for example, if the goal is long-term profitability, you may seek to achieve that goal by measuring and tracking productivity. What you're doing, in the abstract, is this:

measure [parameter] in the hopes of improving [goal]

When dysfunction occurs, the values of [parameter] go up comfortingly, but the values of [goal] get worse.


Previous post on this topic:

• Dangers of forgetting proxy nature of data (our first post)
• Targets Distorting the System
• Measurement and Data Collection

Tom DeMarco and Timothy Lister are authors of the excellent Peopleware: Productive Projects and Teams

Peter F. Drucker on a Functioning Society

Peter F. Drucker on a Functioning Society by Joseph A. Maciariello:

Drucker's concern that the institutions of society function for the common good has led him to be critical of business practice from time to time and to take on the preaching role of a prophet. For example, some of the ratios between the compensation of top executives and those of the frontline worker are well above 500 to 1... To Drucker this is shameful and sends the wrong message to employees and to the public about the ethics of executive conduct. It represents a lack of concern for the welfare of employees and society. There are public corporations that have been very successful over long periods of time who also have maintained, by policy or practice, a much lower ratio between those at the top and those at the bottom.

The Next Society, The Economist:

The next society will be a knowledge society. Knowledge will be its key resource, and knowledge workers will be the dominant group in its workforce. Its three main characteristics will be:

• Borderlessness, because knowledge travels even more effortlessly than money.
  
  
• Upward mobility, available to everyone through easily acquired formal education.
  
  
• The potential for failure as well as success. Anyone can acquire the "means of production", ie, the knowledge required for the job, but not everyone can win.
  

on Drucker's ideas in his book, Managing in the Next Society.

Toyota and the Art of Continuous Improvement

Oh, What A Company! by by Gary S. Vasilash

TPS is not for those who are looking for the fast solution. While implementing any single element of TPS will undoubtedly bring some rather startling results in comparatively short order, it is only through the continuous, persistent application of the principles that fundamental change is realized.

Very true.

Innovation in Software Development Process

Innovation in MSF v4.0

The Work Remaining report uses a cumulative flow chart developed for Lean Manufacturing. Work-in-progress and queuing can be monitored with this report in order to identify bottlenecks and address issues which are affecting throughput and reducing capacity.
...
MSF takes advantage of trustworthy transparency by focusing on the use of reports to drive objective, rational management decisions and interventions. MSF metrics have been selected to be simple, self-generating, relevant and leading (or predictive) indicators of project health. Trustworthy transparency leads to realistic schedules, reliable estimates, sustainable pace of work, and professional maturity rather than a reliance on heroic efforts.

MSF is the Microsoft Solutions Framework.

By developing a Deming-based quality assurance approach to the CMMI and by incorporating all the guidance from MSF for Agile Software Development within that approach, MSF offers organizations a smooth adoption curve up the organizational process maturity ladder.

MSF for CMMI Process Improvement provides acceleration to CMMI Level 3 and provides a basis for progress to Level 4 and Level 5 with up to 35% coverage of practices at those higher levels. Future work in MSF will provide additional guidance on how to smoothly move to Level 5 and adopt the use of statistical process control with existing metrics and reports such as Velocity and Work Remaining. This leads to full implementation of Deming's Theory of Profound Knowledge and his teaching of the avoidance of management mistakes #1 and #2.

Navy Six Sigma Results

Feds Train to Achieve Six Sigma Results by Sara Michael, Federal Computer Week:

For Navsea, responsible for maintaining naval ships and weapons, the Six Sigma-inspired approach encourages managers to closely examine a business operation, such as contracting or information technology support, and look for ways to streamline procedures and deliver better service.

Navsea has introduced Lean Six Sigma programs in 30 of its organizations. In the first year, Brice said, the program is producing tangible effects by saving a total of $200 million on 500 projects.

Lean Government post on Curious Cat Management Improvement Blog

Solectron Drives Lean Six Sigma Manufacturing to its Suppliers

Solectron Drives Lean Six Sigma Manufacturing to its Suppliers

"Lean has fundamentally changed the manufacturing landscape, led by Toyota," said Jim Womack. "The future of the EMS industry is found in Kaizen, and Solectron is leading the way. But to reap the full value and benefits of Lean, Kaizen must permeate up and down the supply chain -- from OEMs to suppliers."

Statistical Techniques for Quality

A new book, Quality Engineering Applications of Statistical Design, by T. N. Goh, was recently published by Wiley. Links to three previous articles by the author are provided below.

Improving on the Six Sigma Paradigm

As six sigma has taken the business world by storm in the past 15 years, many organizations have focused on acquiring and implementing the DMAIC methodology with performance benchmarks defined by "sigma levels". However, after perhaps proclaiming the "six sigma organization" label for the company, it is important for the business leaders to look beyond immediate concerns, i.e. those issues embodied in black belt projects, and adopt holistic and forward-looking perspectives in seriously advancing organizational interests.

Statistical Techniques for Quality by T.N. Goh and M. Xie:

Statistical process control techniques and their role in process improvement are first discussed and some issues related to the interpretation and use of experimental design techniques are also summarised. The focus will be on continuous quality improvement using statistical techniques.

Perspectives on Statistical Quality Engineering by T.N. Goh:

"How is statistical quality engineering related to Six Sigma?" The concepts, techniques and illustrations, explained in a non-mathematical language, are useful to both management and technical personnel interested in strategies and tools for cost-effective quality improvement.
...
Statistical quality engineering constitutes the backbone of the Improve phase, where design of experiments is used to identify the critical parameters (the "vital few" among the "trivial many") in a process or product. It can be said that a Six Sigma program will make or break depending on the success of deployment of statistical quality engineering during the Improve phase.

Air Products Strips Out Inefficiencies

Air Products Strips Out Inefficiencies by Rick Whiting, Information Week:

Air Products standardized on continuous-improvement methodologies based on Six Sigma and lean manufacturing five years ago to boost its operating return on net assets, a metric to measure shareholder return on Air Products' asset base. The IT operation began using about 40 continuous-improvement tools and practices 18 months ago, says Alan Jeffery, manager of continuous improvement for global IT. The methodologies are used for root-cause analysis, where IT processes are scrutinized to identify wasted time and resources.

Supplier Partnering

Supplier Partnering: It's better, it's longer and it's not what you think, Rey Elbo (Philippines):

This is to teach suppliers who could only continue supplying based on their long-term commitment and involvement to the implementation of basic 5S good housekeeping and process flow or layout.

Under this type of partnering, the suppliers are constantly educated, monitored and measured by their clients a.k.a. big companies. If there is ever any confrontation between client and supplier in this relationship, it must take place in the factory where it matters the most.

There is an inescapable logic to this. Education is best learned in the factory, not in the air-conditioned boardroom. It is the best way to survival. Not only teaching their own workers, but their suppliers as well.

Supplier partnering is the key to quality and productivity, and eventually towards competitiveness.

Innovation and Creative Commons

Creative Commons is a license that lets the creators of intellectual property clearly define how that property may be used by others. Partially this license is a reaction to the poor way copyright law is being viewed today (see links below).

Partially it is tool that gives creators a way to provide for more interaction with their ideas. And this interaction is a great way to market, in the right circumstances. More managers should be thinking about how their organizations can use this tool to improve performance.


A great example is found in this Wired article, Open Source Opens Doors to SNL:

Live from New York, it's -- three comic talents who first made a name for themselves on the internet.

Andy Samberg will become a performing member of Saturday Night Live's 31st season cast debuting Oct. 1, while Jorma Taccone and Akiva Schaffer have joined the show as writers. But all three got their first big break online, thanks in part to the viral popularity of video shorts they released on the net. In a move that may have helped fuel rapid grass-roots distribution, the comics released their work under Creative Commons licenses, which essentially let anyone copy a given work for free provided that person doesn't try to profit from it.

This was an effective strategy to get their work into the public eye and market themselves.

Copyright background links:

• Keeping Up With Uncle Sam by Katie Dean, Wired
  
• Misinterpreting Copyright, Richard Stallman
• The Public Domain, Lawrence Lessig
• Creative Commons Is Rewriting Rules of Copyright, Ariana Eunjung Cha, Washington Post