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The experts talk Your management questions answered On the mend How lean is fixing the NHS Boost productivity How your staff could hold the key AN INDEPENDENT PAPER FROM MEDIAPLANET WHO TAKE SOLE RESPONSIBILITY FOR ITS CONTENTS Moving forward : How lean could fix your business today LEAN MANAGEMENT No. 1 / September. ’09 PHOTO: ALEXANDER HAFEMANN 4 TIPS FOR AN EFFICIENT BUSINESS Moving forward : How lean could fix your business today MAKE YOUR BUSINESS HEALTHIER Sinking fast Could lean save the soft- ware industry? Bridge that gap Why middle management could be the answer to your problems Trade secrets Lean pioneers reveal their best tips for better efficiency t hei r r r r r ps ncy

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Page 1: Boost productivity LEAN MANAGEMENTdoc.mediaplanet.com/all_projects/3903.pdf · How lean is fixing the NHS Boost productivity How your staff ... has been to see lean spread. Work-ing

The experts talk Your management questions answered

On the mendHow lean is fixing the NHS

Boost productivity How your staff could hold the key

AN INDEPENDENT PAPER FROM MEDIAPLANET WHO TAKE SOLE RESPONSIBILITY FOR ITS CONTENTS

Moving forward: How lean could fix your business today

LEAN MANAGEMENT

No. 1 / September. ’09

PHOTO: ALEXANDER HAFEMANN

4TIPS

FOR AN EFFICIENT BUSINESS

Moving forward: How lean could fix your business today

MAKE YOUR BUSINESS HEALTHIER

Sinking fast Could lean save the soft-ware industry?

Bridge that gap Why middle management could be the answer to your problems

Trade secrets Lean pioneers reveal their best tips for better efficiency

ptheirrrrr ps

ncy

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AN ADVERTISING INSERT BY MEDIAPLANET2 · SEPTEMBER 2009

Create a winning formula for your organisation through lean

Pioneered in the car industry, adopted across manufacturing industry and now becoming de rigeur in the service sector. Lean is the way to not just survive, but thrive in today’s economic climate.

Lean is a customer focused ap-proach to the delivery of out-standing products and serv ices with the use of a mini-

mum of resources. It uses a range of diagnostic and implementation tools such as Value Stream Map-ping, 5S, TPM, and Kanban. But real-ly it is a way of thinking and organ-ising yourself to become both effi-cient and effective. The key to lean is in leadership, alignment & moti-vation of people and getting every-one to think how tomorrow could be better than today.

Which industries are using it?

1Lean started as an integration of the Just-In-Time principles

with the Total Quality Control ap-proach pioneered by many Japa-nese manufacturers after the war. The term has since become synony-mous with the approach used by Toyota in their phenomenal recent rise to become today’s #1 selling car maker.

When we launched our Lean En-

terprise Research Centre in 1994, Lean was only really used in the car industry. However, one of our goals has been to see lean spread. Work-ing with Tesco from the mid 90s we found the approach, if not exactly the same tools, was readily applica-ble to supermarkets and their sup-ply chains. Since then they have grown by a factor of three and seen profits rise six fold. Not bad for a firm in a mature and highly com-petitive industry.

Since the turn of the century the use of lean has really exploded. It is now widespread, indeed almost mandatory for success in manufac-turing and is rapidly being taken up by service industries. It is increas-

ingly being applied as Lean & Green with also an environmental bent.

Where can you lose lean?

2Lean is best used right across an organisation. However,

many fail to do this and apply lean in narrow pockets, such as the shop floor in manufacturing or the back office in service organisations. The result is that they tend to only scratch the surface of what is possi-ble. Where we see the best results, as in the steel-processor Cogent Power described in our recent Stay-ing Lean book, it is applied right across the business. It affects the strategy, leadership approach, alignment & engagement of people, all business processes and the tools they use. However, most of all, it leads to a different mindset. In such firms you notice a shift from run-ning today’s business to one of cre-ating tomorrow’s business. Such firms will no doubt thrive whilst other may well struggle to survive.

Professor Peter Hines Chairman Lean Enterprises Research Centre, Cardiff University and Co-author of the Shingo Prize winning Staying Lean book

“A lot of ideas are bottom-up so managers may well think ‘hang on, I manage that.’”

Catherine McDermottDirector of distribution at Argos on how lean worked for them

PAGE 10

LEAN MANAGEMENT, 1ST EDITION, SEPTEMBER 2009

Editorial Manager: Katherine WoodleySub-editor: Danielle Stagg

Responsible for this issueProject Manager: James SheerinPhone: 0207 6654403E-mail: [email protected]

Distributed with: The Guardian, September 2009Print: Trafford Park Printers

Mediaplanet contact information: Darren ClarkePhone: 02076654400Fax: 02076654419E-mail: [email protected]

We make our readers succeed!

WE RECOMMEND

CHALLENGES

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There is no getting away from it. The next few years are going to be tough for public services. Whoever is in power after next Spring’s election will have to take tough decisions on where public spending can be reduced. Although the NHS may be shielded against the toughest cuts, it will almost certainly be called up-on to prove it is delivering value for money and achieving more with the same input.

Hence Daniel Jones, Chairman of the Lean Enterprise Academy, ex-plains that he has been helping sev-eral hospitals get to grips with lean management. In fact, the interest among hospitals in the past four to five years has been so great that he has also authored Making Hospitals Work to introduce NHS managers to the principles of lean management.

“Hospitals waste so much time through the need for so many things that are not managed to come together before a patient can leave,” he says.

“You need the pharmacy to pro-vide the right drugs, for test results to get back to the ward, for a bunch of forms to be filled in and for all this to coincide with whenever the doctors do their rounds. Nobody has an overview of the process and so It means people spend so much more time in hospital than they need to and beds don’t get freed up.”

Better flowJones sums up hospitals as having a ‘back door’ problem where the big-gest room for improvement is get-ting people out of hospital in a time-ly fashion so they make way for more people to enter the system.

The key to investigating lean management techniques is for management and healthcare pro-fessionals to map out processes so they can be designed to cut down on predictable time delays and, cru-cially, be synced around the patient and the ward they are staying on.

“You’ve got to focus on the cus-tomer and all too often this can ap-pear to be the consultant and not the patient,” Jones adds.

“It can be hard to get everyone working together. However, if you show to doctors and consultants

that by freeing up beds there is more scope for them to do their elective work and then you show the man-agers they can do more operations and cut down on waiting lists with the same resources. Then you show nurses they can actually do their job instead of running round looking for test results and drugs. The result is everyone can see the sense in bet-ter processes.”

In fact the upshot can be, Jones predicts, a welcome end to people being resentful for being blamed for time delays built in to process-es they have no overall view of and which they did not design but in-herited.

SEAN HARGRAVE

[email protected]

Question: With tough choices on public spending ahead, what can the principles of lean management bring to the NHS?Answer: Building streamlined services around the customer should allow hospitals to achieve more with the same or a lower budget.

MAKE YOUR BUSINESS HEALTHIER- GET LEAN

DanielJonesLean Enterprise Academy Chairman.

NEWS

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LEAN FINANCE

Lean Finance experts

www.jsk-solutions.com

When you decide the time is right to cut needless work and ineffi-ciencies in your Finance processes, who should you get to help?

The Big Consulting firms all say that they can do it. But the reality is that Lean 6 Sigma experience in Finance processes is thin on the ground.

If you are prepared to use a boutique consultancy, you should talk to us – JSK Solutions.

Our clients include a FTSE 100 retail company, a FTSE 100 In-surance company and the European Shared Services Centre of a Fortune 500 FMCG company.

JSK Solutions is often used by the big firms to provide the required skilled resource to enable them to deliver.

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AN ADVERTISING INSERT BY MEDIAPLANET SEPTEMBER 2009 · 5

IN THE RIGHT DIRECTIONLean management is helping the NHS to not on-ly cost cuts but reduce waiting-time for patientsPHOTO: DR. HEINZ LINKE

DANIEL JONES’ BEST TIPS

FOR A LEAN NHS

3Start at the back door

1If test results, ward rounds and take-home medications

are not synchronised and nurses are busy with other things then pa-tients end up staying much longer than they need to, blocking other patients.

Typically 25% of medical patients are ready to go home but can’t. Re-ducing length of stay means that hospitals can slash their overtime budgets, existing staff can see more patients and they no longer need to cancel elective procedures.

Follow the patient

2No one sees the whole jour-ney experienced by patients,

particularly the multiple visits and the lengthy waits. Give someone the responsibility to get agreement from everyone to enable patients to flow.

Look in the cupboards

3Reveal thousands of pounds worth of stock hoarded in eve-

ry ward and theatre because re-plenishment is unreliable and weekly. Return this stock to central stores and save 30% on the procure-ment budget by learning from re-tailing how to replenish exactly what is required several times a day.

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Finance workers almost take it for granted they will not be social-ising at the end of every month as they seek to ‘close’ their books. So, ends of quarters and the end of the year make for particularly harrowing times.

Hence, many companies with sizeable accounting departments are now turning to lean con-sultants to see if the complicat-ed processes of working out the company’s accounts can be com-pleted quicker and with far less hassle for staff.

Matching codesThe key problems are people out-side the finance function not us-ing the same sales or product codes and so records do not tally.

Often people in other depart-ments have established ‘work rounds’ which allow them to push on invoices or sales vouch-ers which are not in the required format.

Hence, consultants reveal one of the major advances lean brings with it is the simple, but effec-tive, practice of going outside the finance department and helping colleagues to understand how to process work properly the first time so mistakes are not passed on.

There can also be extensive gains by mapping the flow of pay-ments procedures, Keith Bissett, Chairman of the Bourton Group explains.

“We’ve worked with big finan-cial institutions and they can save days by simply having com-mon procedures for dealing with mistakes as simple as the date or account number being wrong, rather than leave incorrect paper work sitting in various in-trays,” he said.

SEAN HARGRAVE

[email protected]

UNITED KINGDOM

Streamlinedfinances

There are many issues that a company needs to think about in these dark economic times. Finding the right education and advice is crucial to staying afloat.

To the outside observer, the process of commissioning, writing, check-ing, validating and rolling out soft-ware would appear designed to lead to delays and wasted budget.

Hence, Colin Bird, Global Head of Agile Practice at EMC Consult-ing, explains that agile software de-velopment is a relatively new dis-cipline which seeks to build teams around development and ensure code is released in small batches.

“The old way is for a business to decide it needs some software and then send a coder in to a dark room who then throws a huge pro-gramme over the wall a year later and everybody’s disappointed,” he says.

“With agile you build a team around a project so you don’t have divisions between managers and technical people, and you also en-

sure it’s done in small increments. That way code can be tested and new requirements factored in throughout the process so you don’t wait 18 months only find it doesn’t work or meet your expectations.”

RightshiftingThe widely recognised problem of software projects failing has prompted Bob Marshall, Head

Coach at Falling Blossoms to devise the principle of rightshifting. The term relates to a diagram in which most companies find themselves on the left of a graph where con-siderable time is wasted and pro-ductivity is low. The answer is to ‘rightshift’ to the side of the equa-tion where productivity is high and wastage low.

“The first step is for a company to realise they are on the left hand side of the graph and so wasteful and then commit to rightshifting,” Marshall explains.

“We use a lot of value stream mapping, where we map the proc-esses and pinpoint where the value is added and then look to tackle the hold ups. A lot of money and time can be saved by people not passing on bad work so it doesn’t have to be corrected.

“Once a company commits you find people cooperate better and you get fewer specialists, people tend to be good at several roles. They then ‘rightshift’ on the graph and pro-ductivity is higher and waste cut.”

6 · SEPTEMBER 2009

SHOWCASE

Lean in software development

STRUGGLINGThe amount of software projects are falling but this could be prevented lean managementPHOTO: WOJTEK KRYCZKA

SEAN HARGRAVE

[email protected]

Less than a third of software

projects, succeed. The same propor-

tion fail outright and the rest are severe-

ly ‘challenged’.

Lean software development re-

leases code in batches so for on-going

testing to avoid long term projects fail-

ing at the last hurdle. Around 70% of IT budget is spend

on day to day running, not long term

projects.

FACTS

Colin BirdGlobal Head of Agile Practice EMC Consulting

NEWS

CO-OPERATION IS VITAL

CCO-OO-OPOPOPOPPOPOPEEEEEEEERRRRRRRAAAAAAATTTTTTTAAAAAAAAAA IIOIOIOIOONNNISS V VIITTALALTTT

2TIP

Question: With around half of software projects failing, can lean help?

Answer: Lean or ‘agile’ development procedures do for code what lean has done for companies

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AN ADVERTISING INSERT BY MEDIAPLANET SEPTEMBER 2009 · 7

Virtusa Delivers Lean IT

Clayton Locke, Managing Director

Virtusa Ltd I Orchard Lea Windsor, UK SL4 4RU United Kingdom I Phone: +44 7824816254

Virtusa brings a Lean approach to business con-sulting and IT Services. We take advantage of Lean methods and the efficiency of a global de-livery model to achieve more than just cost sav-ings – we partner with our clients to drive better business performance with a focus on continu-ous improvement.

In the 1980’s Toyota started implementing Lean manufacturing across its operations. Lean manufacturing helped to create a cul-ture of excellence at Toyota and eventually revolutionized the automobileindustry. Ap-plying fundamental concepts of quality management, measurement and continuous improvement across its operations enabled Toyota to out-perform their competition and become the most profitable automobile company in the world.Virtusa works with our clients and IT improve-ments using Lean principles, an approach we call Lean IT. There is much to be gained: faster concept-to-market, reduced cycle-time, im-proved qualityand superior customer experi-ence. Lean IT can drive continuous improve-ments to business performance – and become as much a competitive asset for a firm as Lean manufacturing proved to be for Toyota.

Component-Based BusinessYears ago most automobile companies moved away from building cars out of parts designed for a single product-line, to building cars using component-based assemblies. The component-based approach enables Toyota and other com-panies to quickly bring new concepts to market, whilst continuously improving their platforms within a quality-oriented culture guided by Lean manufacturing methods.Lean IT is now feasible because business process and software is also becoming more component based. Component-based assemblies of busi-ness process and technology, within a supporting business culture of change and quality, are now enabling modern businesses to step up to higher levels of performance. Businesses that do not adopt a Lean approach risk rapidly falling behind their more agile and higher quality competitors.Lean IT is a new way to apply Lean principles to business process and technology improvement. Lean IT offers a way for all businesses to apply the proven approach of leading companies like Toyota to lower costs, reduce cycle time, and de-liver the highest quality experience to their cus-tomers.

Please contact us to learn more about how Virtusa can deliver Lean IT to your business.

As a global leader in the high octane world of business-to-business express delivery, TNT is renowned for its innovative spirit

and its ability and willingness to embrace posi-tive change.

It’s hardly surprising then, that TNT Express is leading the express, logistics and transportation sector in its adoption and implementation of Lean processes and methodology.

With the deployment of Lean more histori-cally aligned to manufacturing and production focused industries, TNT has successfully adapted and applied the core principles and values of Lean in a service-based environment.

Driven by its philosophy of moving its performance levels from good to great, TNT, in conjunction with its partners, Breakthrough Management Group International, is enjoying the benefits from a number of successful Lean pilot projects throughout Europe and North Asia.

optimumChris Goossens, Global Director Customer Experi-ence for TNT is delighted with the results to date: “We are taking a unique approach to improving our processes - one that helps us strike the opti-mum balance between the needs of our custom-ers and our own internal performance levels.

“We are seeing signifi-cant improvements

in customer experience, productivity and cost optimisation.”

Employing more than 75,000 people world-wide and moving on average 4.4 million parcels, documents and pieces of freight each week to more than 200 countries, TNT Express selected its business here in the UK – TNT Express Services - to lead the way on the company’s Lean activities.

agileSimon Harper, TNT’s Head of Road Network in the UK and an acknowledged Lean expert and exponent said: “Lean is about work-ing smarter not harder and a critical component in helping the company achieve its strategic goals, both in the short and long term. It’s about running operations where there’s no excess and no waste and it’s about ensuring TNT is agile, healthy and built for performance.”

The three targeted areas for the UK business were to:

Improve efficiency and effectiveness of operationsEnsure continuous and sustainable im-provementOptimise cost structure by minimising overheads

The UK is at the forefront of TNT’s Global Lean Initialisation Team helping the wider learning and sharing perspective with colleagues overseas and establishing TNT’s own Lean identity under the strapline ‘A smarter way of working.’

With its culture of striving for continuous improvement TNT is listening and acting on the suggestions of the ‘real experts’ on Lean – its own people on the frontline.

“The really encouraging aspect of the initiative is the ‘buy in’ from our people who, once they’ve had the training, are identifying ways and means of improving the way they perform in their own roles.

“Ultimately, Lean is empow-ering our people and that brings its own rewards and job satisfac-tion levels” added Simon.

Chris conclud-ed: “Lean really is a smarter way of working, a fact evidenced by the significant improvements in our productivity and efficiency levels to date, and it will be an integral element in all that we do across our entire global structure. Our journey is only just beginning...”

Lean – A smarter way of working…

* Additional information on TNT Express Services is available at www.tnt.co.uk or by calling 01827 303030

Lean leader - Simon Harper says Lean is an ‘empowering’ force within TNT

Global perspective– Chris Goossens says Lean is an integral element in TNT’s worldwide operations

Opening doors – Lean is paving the way to a smarter way of working at TNT

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AN ADVERTISING INSERT BY MEDIAPLANET8 · SEPTEMBER 2009

Question: Is getting lean all about cutting waste?Answer: Yes, and no. According to Accenture’s Mark George, cutting waste is important but it is a means to a far more ambitious end, not the end itself.

When a company decides it could be more efficient and competitive by getting lean, there is an understandable need to look at waste.

However, all too often, warns Accen-ture’s leading lean expert, Mark George, companies can forget the bigger picture.

“If there’s one piece of advice I can pass on it’s to not forget what the end goal is,” he says.

“Sure, you need to cut waste, that’s a re-ally important part of the transformation but you must never forget that getting lean is all about increasing shareholder value by better serving your customers.

“The end goal isn’t just about buying a bunch of tools and hoping they’ll simpli-fy your processes, it’s about changing an enterprise so the whole organisation is more flexible.

“This means it is far speedier in its abil-ity to meet new demand and to innovate and compete.”

Team effortFor George, the secret in getting to this end goal is for the whole of an organisa-tion to get involved with the programme. Nobody intentionally builds a company which is designed to waste time and de-crease productivity but, as he has wit-nessed over the past decade, growth can bring organisational problems. These is-sues can only be tackled with the willing cooperation of staff across a company’s multiple departments.

“Businesses have been under huge pres-sure to grow and go global at a fast pace and this can bring in new levels of com-plexity and people just get on and manage the best way they can,” he says.

“So you need to make it a company-wide programme because you need people at all levels to feel they’re involved and then they’ll show you how to make improve-ments.”

Beyond widgetsThis is particularly true of lean manage-ment, which has often been seen inter-

changeable with the term lean manufac-turing, grows in popularity beyond the base of engineering. Today financial insti-tutions, government departments, retail-ers and many service-driven businesses are also looking to go lean.

“It’s pretty obvious to see in a produc-tion line where the waste is, it’s physical, you can see the bottlenecks developing,” George adds.

“Where you need more skill is with processes, such as financial transactions. We recently worked with a Government department on a social benefit applica-tion process that was taking 140 to 270 days because there were 37 steps in dif-ferent departments and each person on-ly saw their 37th of the process. By giving visibility from one end to the other and mapping out the process, which only had three areas where value was added to the end consumer, we got that down by 65 per cent.”

Speed and flexibility- Lean’s two goals

SEAN HARGRAVE

[email protected]

LEADER TO LEADER

“The end goal isn’t about buy-ing a bunch of tools and hoping they’ll simplify your processes.”Mark George Head of Global Operations at Accenture

INSPIRATION

You want to deliver more value to more customers, be more competi-tive and be a winner in the economic recovery.We can help you to solve key problems and guide you on your new pathway to growth. We bring deep, experience-based knowledge, targeting rapid improvements to your business, our proven approaches helping you grow profi tably. We accomplish this by applying our proven, integrated and repeatable methodologies, guiding your team in achieving rapid business results. We help you to deploy Lean strategically, your business will realize fi nancial im-

provements needed to increase the pace in your growth markets and es-tablish a cost-eff ective platform from which to develop the next-generation of your business.

As you begin the Rapid Transforma-tion Process, consider these ques-tions:1.What do you see as the key busi-ness imperative your company must achieve over the next twelve months? 2.Which improvements to core busi-ness processes will best enable your company to achieve your key business imperative? 3.Does the talent and know-how of

your team cover your company’s en-tire business process, end-to-end?4.Which performance metrics need to be in place, captured and analyzed regularly to help you ensure business success? Lean Horizons Consulting works with your team to answer these questions, develop key skills and action plans, and guide your team to target process im-provement and profi table growth.

Want to know more?Lean Horizons Consulting brings its integrated competencies to clients to achieve enterprise wide perform-ance transformations. We focus on

driving Speed to Value and providing services to clients across all functional disciplines and throughout all phases of maturity of Lean deployment. Our internationally experienced profes-sionals, each with direct lineage to the Toyota Production System, combine their explicit and tacit knowledge and process culture insights throughout each lean performance transforma-tion.

Contact Information: Roger Burghall, Managing Director, Europe. On the Web: www.leanhorizons.comEmail: [email protected]

Lean Horizons Consulting can help you thrive by shifting your strengths into overdrive.

SM

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AN ADVERTISING INSERT BY MEDIAPLANET SEPTEMBER 2009 · 9

PLANNING IT THROUGHBy involving all areas of a business into a strategy more can be acomplishedPHOTO: DMITRIY SHIRONOSOV

PROFILE

Mark George

Position: Group Leader at

Accenture’s Proc-

ess and Innovation

Performance serv-

ice line (P&IP)

Recent Projects: Within the past sev-

en years Mark has

architected and

supported enter-

prise Lean Six Sig-

ma transformation

initiatives at more

than 25 Fortune

1000 organisations

Education: Degree in business

management, fluent

in Spanish

Publications: The Lean Six Sig-

ma Guide to Doing

More with Less (due

for publication by

John Wiley & Sons

Publishing in Janu-

ary 2010)

Getting your business in shape for the future: working seminar

Salamandersolutions for the agile enterprise

Achieving business performance improvementthrough business and IT transformation.

For more information visit www.leanenterprise.org.uk or call 029 2064 7028

The Lean Enterprise Research Centre (LERC) off ers numerous courses and

learning opportunities, including short courses and bespoke in-house training.

MSc in Lean OperationsExclusive 2 year part time executive Masters Degree

Short Courses

Programmes

The Lean Enterprise Research Centre LERC is the leading centre for lean thinking in

Europe, specialising in applied research, teaching,

knowledge transfer and mentoring.

lean education & knowledge transfer

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Anybody who has made the bold decision to go lean can testify that there are some early wins which can be encouraging because once management and their employees put their mind to it, there are nor-mally obvious instances of waste which can be quickly cut down.

For some, this could be consid-ered a job well done. For leading on-line and high street retail chain Ar-gos, however, it was only part of the story.

Maintain gains Director of Distribution, Cather-ine McDermott, explains that the household name got involved in lean management after a distribu-tion centre built five years ago ini-tially failed to live up to expecta-tions.

When problems there were tack-led, the chain realised it need-

ed a wider ranging programme to spread the better practices to addi-tional distribution centre.

“We had got our new centre near Burton on Trent past its teething problems so we were looking to bring in the same waste-cutting principles to other distribution cen-tres,” she says.

“The problem was we would have early gains and things would seem great but when we’d go back a few months later we realised that things may have just started to slip a little bit again. It was clear there was something we weren’t quite managing right. We realised that if the early gains were to be main-tained and improved upon, we had to get lean in to our culture.”

Coaching coachesAfter seeking help from a lean con-sultancy, Argos started to concen-trate on its people as well as its processes. One of the most impor-

tant parts was not to just sit down with employees to find solutions to issues but to also teach managers how to be leaders, McDermott re-veals.

“We’ve done a lot of training with our managers because their role is changed within a lean organisa-tion, it’s a hard journey for them,” she says.

“A lot of the ideas are bottom-up and the managers may well think ‘hang on, I manage that’. So, we’re helping them become leaders, so they can mix the roles of being a manager asking for things to be done as well as a coach helping peo-ple realise their potential.”

While cost and capacity have been improved, McDermott reveals that these are by-products of the biggest gain of all; engagement.

In fact, the process has proved en-couraging enough after 18 months for a five year roll-out programme to be accelerated to be completed within a further 18 months, two years ahead of the initial delivery goal.

Question: What is the secret of building on early lean gains?

Answer: Make lean part of your culture, not just your processes, or those early wins can whither on the vine.

SEAN HARGRAVE

[email protected]

CHANGE

Lean staff maintain lean gains

MAKING IT WORKBy implementing lean management into your operations your business could bloomPHOTO: NICOLE WARING

Catherine McDermott Director of distribution for Argos

INSPIRATION

QUESTIONNAIRE

How does lean help compa-nies to improve their inno-vation efforts?

“A vast proportion of people’s time is wasted every day in R&D. Lean R&D eliminates much of this waste by letting customer needs drive the R&D agenda and by re-us-ing hard won insights. A continu-ous improvement culture empow-ers Lean R&D workforces to strive for incremental advances while re-maining open to the next radical new idea.”

Per I. NilssonGlobal Leader of Arthur D. Little’s Technology and Innovation Manage-ment Practice

Do companies going lean exhibit visible benefits?

“Yes, Plants are fast paced, bright and orderly, colour and lights are used to highlight prob-lems early, low inventories, high quality yields and fast cycle times are the norm.

Management live on the shop floor with multidiscipline Kaizen teams. Results are celebrated to-gether; rewards are shared in re-al time.”

Masood HassanPrinciple, PRTM

What are the main advanc-es lean consultants leave behind?

“The main gains that we be-lieve we leave behind after work-ing with an organisation are more simplified lean processes which add greater value, signifi-cant cultural change delivering better customer service for less costs, with an ability to deliver ongoing continuous improve-ment which is embedded in the organisation.”

Peter LunioAssociate Director, Baker Tilly Management Con-sultancy

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Logistics is so process intensive that it provides plenty of scope for lean techniques to cut waste and boost productivity. At the same time, it is a discipline where waste can only truly be dealt with and working cul-ture changed if staff are empowered to make improvements.

As Simon Harper, a lean expert from a leading logistics company explains, there are obvious areas where logistics companies can cut waste, but these are normally best dealt with by staff suggestions.

“Motion can be a big issue in lo-gistics, and so can process,” says Harper.

“You make sure everything is to hand and things are handled prop-erly so they don’t have to be re-han-dled.

“The best part is you get a lot of ideas flowing up from all staff. We’re

in a blue collar industry and so our motto is ‘you don’t have to wear a suit to have an idea’. So we get lots of great suggestions and so far we’ve managed to boost productivity by around 10 per cent to 15 per cent. It

means we’re doing a lot more with the same capacity so we’ve got the ability to take on more work when the economy begins to recover without the expense of building a new distribution centre.”

Small adds upThis is typical of the kinds of gains companies can achieve, accord-ing to Luc vander Beken, Senior Engagement Partner at lean con-sultancy BMGI, which frequently helps companies, including many logistics operations, improve their performance. For Beken, the key is in rolling out gains across networks and training staff to champion lean with an organisation.

“The key is that little things in one centre make a huge difference when you roll them out to the rest of that company’s logistics hubs,” he says.

“The striking point with logistics companies is that they have similar problems in each distribution cen-tre so you can see how people are coping with it and then roll out the best solution across the network and it makes a massive impact. To ensure the gains are kept, we train managers up in lean so they can then spread lean throughout the organisation when we’re gone, it’s crucial to keep the momentum go-ing.”

Staff solutions key to lean logistics

MOVING ON UP. By instigating the flow of ideas your business could run more efficiently, thus boosting productivity. PHOTO: ISTOCKPHOTO

SEAN HARGRAVE

[email protected]

Lean logistics have been cru-

cial throughout history, the Roman,

Greek and Byzantine armies had of-

ficers called Logistikas to ensure ar-

mies were efficiently supplied.

Being lean pays. Many companies

will outsource part of their logistics

to third party logistics providers, or

3PLs, on the basis of the efficiencies

they bring.

There has even been a rise in 4PL

providers who take a strategic overview

of the company and its 3PL providers in

a bid to drive further efficiencies.

Lean logistics can also help cut cor-

porate carbon footprint.

FACTS

NEWS

UTILISE YOUR WORKFORCEUUTITITIIT LILILILILILISSSSSSSEEEEEEE YYOYOYOYOYOYOYOUUURURURR WORKRKFOFORRCE

4TIP

Question: With goods and parcels flowing in daily, there must be lots of room for lean to improve performance in logistics?

Answer: Motion wastage and re-handling provide much scope but staff, as ever, are key

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Any expert will tell you that lean management is all about breaking down departmental silos and

thinking of a process in its entirety from end to end.

While this may seem straightfor-ward enough in principle the actu-al task of going into a company and getting people from different parts of the organisation to talk to one another in detail about every part of the processes they are involved in can require a lot of diplomacy.

Keith Bissett knows only too well how difficult it can be to get every-one to map out a process and anno-tate it with the time taken, punc-tuated by where the value is add-ed. As Chairman of Bourton Group, he has been involved in many lean management projects for the likes of Siemens, Network Rail and HM-RC. These assignments can only be successful if each part of the teams involved can add their part of the process to the overall ‘process map’ and reveal the ‘time bubbles’ where it is held up without adding value to the customer.

“Lean management is all about

getting company employees of all levels to think about the custom-er and work out how things could be done better for the them, rather than gear services around the way the company has developed in to departments,” he says.

“We find the first problem we have to advise the client to be aware of is that people on the shop floor will be suspicious we’re there to reduce head count. The way to get around this is to explain that any cuts are going to happen any-way and we’re there to make their life easier. The alternative would be they could all just do the same amount of work but with, say, 10 per cent fewer people. Given the choice, most people want to find a way to do things better.”

Engage managersWith the ‘shop floor’ fears allayed the best way forward is to use all levels of management to think through a process and improve it.

Far too often, Bissett reveals, companies can fail to realise mul-tiple departments and many differ-ent levels of pay grade need to be in-

Middle level can feel the squeeze

Many companies will have a cultural resistance to change but once lean management has taken the hassle of out an employee’s job and left the board with an improved bottom line, the main problem can be enthusing middlemanagers to find new roles for themselves.

volved.Once the top and the lower levels

have ‘bought in’ to a project, the re-maining problem can be the mid-dle managers who are wondering what their role is going to be. “Once you’ve got the whole company in-volved and you’ve worked out where you can save time and streamline processes the difficulty can be mid-dle management,” Bissett adds.

“Middle managers can be the meat in the sandwich as the shop floor and top management get to-gether. They’ve always been the ex-perts whom staff turn to and so they can wonder what their role is. This is the tough part for companies, they need to assign roles to middle managers so they know where they fit in and ensure they are motivated to work the new system.”

Many will enjoy an end to ‘fire fighting’ problems, Bissett reveals, but some could remain resentful so careful attention to management training is required.

“Middle managers can be the meat in the sandwich as the shop floor and top management get together”

CO-OPERATION

Keith BissettChairman of Bourton Group and developer of projects with Network Rail, HMRC and Siemans

PROFESSIONAL INSIGHT

SEAN HARGRAVE

[email protected]

Lean Enterprise Research Centre

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