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THE FLOW SYSTEM (TFS) The Next Level of Lean
March 4, 2020
Copyright The Flow Consortium llc and Nigel Thurlow 2017 onwards, Cognitive Edge https://cognitive-edge.com/ and Business Improvement Group All rights reserved. Confidential -- Distribution prohibited without permission.Graphics ⓒ by Nigel Thurlow
Notice
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C. ⓒ2017 onwards by The Flow Consortium llc and Nigel Thurlow and Business Improvement Group All rights reserved. Confidential -- Distribution prohibited without permission.Graphics ⓒ2020 by Nigel Thurlow.
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CHARLIE PROTZMAN - CEO & Managing Partner
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• Brake pads and shock absorbers in Holland, Italy, China, Poland • Medical devices in the Caribbean • Aircraft Engines machining and assy in the US and Mexico • Banking in Puerto Rico • Railroad foundries and forgings in the United States • Hospitals, Labs and Clinics in the United States and Canada
A Glimpse At Our Portfolio:
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Two Time Shingo Prize Winning Author
Copyright The Flow Consortium llc and Nigel Thurlow 2017 onwards, Cognitive Edge https://cognitive-edge.com/ and Business Improvement Group All rights reserved. Confidential -- Distribution prohibited without permission.Graphics ⓒ by Nigel Thurlow 5
• The Flow System™ provides a re-imagined system for organizations to understand complexity, embrace teamwork, and autonomous team-based leadership structures.
• Flow is a collective social motion in which individuals, or agents, learn to understand and react to their environment to obtain the goals of delivering value to the customer.
• Flow ultimately results in employees concentrating on the act of doing rather than combatting or succumbing to organizational friction.
The Flow System
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The System Creators
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What is The Flow System™?It’s not a framework It’s not prescriptive
Unique for each organization
Holistic in its implementation
Designed for VUCA
Master’s UNT
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It’s All About Modifying Leadership Behaviors
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The DNA of Organizations™
Implementing the Triple Helix of Flow™ will require a level of organizational transformation to take place.
TFS Flow DefinitionFlow is the seamless transition, from idea creation to
delivery, through the interconnectivity of the three
components of Complexity Thinking, Distributed Leadership, and Team Science.
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TFS Shares the Lean Customer FocusIncreasing customer value, by eliminating waste throughout
the value stream*
9Based on definition in the book Lean Thinking, Womack & Jones, Simon & Schuster
We Spend 75-95% of Our Time Doing Things
That Increase Our Costs and Create No Value for the
Customer!Product Flow Should Generate Money
People and Resources Cost Money
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The Toyota Way
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And it produces:•Highest Quality
•Lowest Cost
•Shortest Lead-Time
A key approach is ‘Monozukuri wa hitozukuri’, translated as ‘developing products through developing people’. Monden
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The DNA of Organizations™
Implementing the Triple Helix of Flow™ will require a level of organizational transformation to take place.
The Flow System CharacteristicsInterconnectivityInteractions
Evolving Emergence
AdaptiveAgile
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Core Principles of The Flow System1. Customer 1st
2. The FLOW of Value
3. The Triple Helix of Flow
• Complexity Thinking
• Distributed Leadership
• Team Science
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Complexity Thinking Distributed Leadership
Team Science
Be able to adapt to be more innovative and agile in complex environments
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The Purpose of a Company
You’ll Find Them Here!
CUSTOMER
Source: various including Harvard Business review 1988 - https://hbr.org/1988/09/management-and-the-worlds-work 13
Customer Results Exist Only On The Outside… There is only one valid definition of business purpose:
to create a customer
Peter Drucker - The creator of Management by Objectives (MBO) 1954
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The Shifting Perspective
Company
Customer
Customer
Company
The Copernican Revolution in Business
Steve Denning The Age of Agile 2018
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The Customer is Now the Center of the Universe!
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Stakeholders vs Shareholders
Source: https://www.nytimes.com/2019/08/19/business/business-roundtable-ceos-corporations.html August 19th 2019
Shareholder Value Is No Longer Everything, Say Over 200 C.E.O.s
Delivering value to our
customers.
Investing in our employees.
Dealing fairly and ethically with
our suppliers.
Supporting the communities in
which we work.
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Core Principles of The Flow System1. Customer 1st
2. The FLOW of Value
3. The Triple Helix of Flow
• Complexity Thinking
• Distributed Leadership
• Team Science
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Complexity Thinking Distributed Leadership
Team Science
Be able to adapt to be more innovative and agile in complex environments
Copyright The Flow Consortium llc and Nigel Thurlow 2017 onwards, Cognitive Edge https://cognitive-edge.com/ and Business Improvement Group All rights reserved. Confidential -- Distribution prohibited without permission.Graphics ⓒ by Nigel Thurlow
What is Flow?
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P DCA
P DCA
PDC
A
PD
CA
Data
Repeated use of the PDCA cy
cle
Lean ThInking, Womack and Jones
“Costs do not exist to be calculated. Costs exist to be reduced.”-- Taiichi Ohno
Motion is not value added - Ohno
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What is the Flow of Value?
Can we truly see all the WASTE in our organizational structures and our behaviors?
• Customer is willing to pay for it• Physically or emotionally changes the
thing or person for the better
• Done right the first time
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Flow = ∑of ValueAdded Activities
Copyright The Flow Consortium llc and Nigel Thurlow 2017 onwards, Cognitive Edge https://cognitive-edge.com/ and Business Improvement Group All rights reserved. Confidential -- Distribution prohibited without permission.Graphics ⓒ by Nigel Thurlow
Outcomes of The Flow System
Cost of Sales Trend
YTD Trend – Last 3 Quarters
Enables Growth
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Reduces Cost Changes Behaviors
Copyright The Flow Consortium llc and Nigel Thurlow 2017 onwards, Cognitive Edge https://cognitive-edge.com/ and Business Improvement Group All rights reserved. Confidential -- Distribution prohibited without permission.Graphics ⓒ by Nigel Thurlow
Core Principles of The Flow System1. Customer 1st
2. The FLOW of Value
3. The Triple Helix of Flow
• Complexity Thinking
• Distributed Leadership
• Team Science
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Complexity Thinking Distributed Leadership
Team Science
Be able to adapt to be more innovative and agile in complex environments
Copyright The Flow Consortium llc and Nigel Thurlow 2017 onwards, Cognitive Edge https://cognitive-edge.com/ and Business Improvement Group All rights reserved. Confidential -- Distribution prohibited without permission.Graphics ⓒ by Nigel Thurlow 21
Copyright The Flow Consortium llc and Nigel Thurlow 2017 onwards. All rights reserved. Confidential -- Distribution prohibited without permission.Copyright 2017. Toyota Connected. Confidential -- Distribution prohibited without permission.
What is Complexity?
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Complexity Thinking
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Complexity is a phase shift on how we think about management. Dave Snowden
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Cynefin Framework
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COMPLICATED
CLEAR
COMPLEX
CHAOS
UNORDERED ORDEREDL I
M I N A L
DISORDER
The Cliff
Scrum
(C) Cognitive Edge - https://cognitive-edge.com/
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Cynefin Framework
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COMPLICATED
CLEAR
COMPLEX
CHAOS
UNORDERED ORDERED L I
M I N A L
DISORDER
Scrum
The Cliff(C) Cognitive Edge - https://cognitive-edge.com/
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Cynefin Framework
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COMPLICATED
CLEAR
COMPLEX
CHAOS
UNORDERED ORDERED L I
M I N A L
DISORDER
Scrum
The CliffAct - Sense - Respond
Probe - Sense - Respond Sense - Analyze - Respond
Sense - Categorize - Respond(C) Cognitive Edge - https://cognitive-edge.com/
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Cynefin Framework
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COMPLICATED
CLEAR
COMPLEX
CHAOS
UNORDERED ORDERED L I
M I N A L
DISORDER
Scrum
The CliffNo Constraints
Emerging Constraints Governing Constraints
Fixed Constraints(C) Cognitive Edge - https://cognitive-edge.com/
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Cynefin Framework - Usefullness?
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COMPLICATED
CLEAR
COMPLEX
CHAOS
UNORDERED ORDERED L I
M I N A L
DISORDER
Scrum
Surveys Standard Work Traditional Project Management
Strategic Planning Agile Culture & Safety R&D Distributed Leadership & Teams
Manufacturing Lean Practices / TPS Traditional Leadership - Command and Control PDCA / Root Cause
The Cliff
Can be used for Innovation
Terrorism, Competitors(C) Cognitive Edge - https://cognitive-edge.com/
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Sensemaking
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Methods Patterns
UNDERSTANDING OF
In Complexity We Use Narratives!
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Complexity and Safety Culture• I believe MY COMPANY is truly committed to the
health and safety of employees• Incidents and accidents are investigated quickly in order
to improve workplace health and safety• I see health and safety is a focus every day in my [work
area / team / department]• I am comfortable voicing concerns or making
suggestions about workplace health and safety• Workplace health and safety is considered to be at
least as important as production and quality
29Culture Cannot Be Measured or Have a KPI!
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“Real” Safety Culture Feedback
30You Will Never Get to Zero Accidents with Humans
https://medium.com/@Alibaba_Cloud/conways-law-a-theoretical-basis-for-the-microservice-architecture-c666f7fcc66a
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Weak Signal Detection
Recession December 2007• Sub Prime Market - signals started as early as 2001• Impending housing bubble• Derivatives
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The Goldman Sachs Group Inc. warned that “nominal U.S. home prices may be headed for an outright decline in 2007. And in early 2007, his colleague
further warned that “there are signals of a decrease in mortgage lending criteria and initial signals of financial troubles from subprime lenders.
Warren Buffett foresaw that complex derivatives would multiply and mutate until “some event makes their toxicity clear.”
Source: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3964612/
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Inattentional Blindness
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Lung Nodule - Eye Tracking Results - 24 Radiologists - 83% Missed The 48x Gorilla!Microwave Oven - Anti Microbial Peptides
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Distributed Leadership
The behavior patterns of those who lead people and teams.Distributed Leadership
The behavior patterns of those who lead people and teams.
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Distributed Leadership
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Intent Based Leadership
Having one point of command was not only limiting to the efficiency of operations of the sub.
It was downright dangerous!
Turn Followers into Leaders!https://www.davidmarquet.com
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Santa Fe
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Establishing Psychological Safety
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BlamingOthers
Less Likely to Share Different Views
Common Knowledge
Effect
Fear of Admitting Mistakes
Psychological Danger Psychological Safety
Learning from Failure
Everyone Openly Shares Ideas
Better Innovation & Decision Making
Comfort Admitting Mistakes
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Cognitive Bias
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How many of you have biases in decisions you make every day?
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Shared Mental ModelsExercise
Think about the first word that comes to mind when you hear:
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Flower
Color
Furniture
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Shared Mental Models
39So… We like to think we are all independent Thinkers
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Its all about Leadership Behaviors1. Personalizing2. Mindreading3. Negative predictions4. Underestimating coping ability5. Catastrophizing6. Attention Biased 7. Negatively biased recall of social encounters8. Thinking an absence of effusiveness means something is wrong9. Unrelenting standards10. Entitlement beliefs11. Justification and moral licensing12. Belief in a just world13. Seeing a situation only from your own perspective14. Belief that self-criticism is an effective way to motivate yourself toward better future behavior15. Recognizing feelings as causes of behavior, but not equally attending to how behavior influences thoughts and feelings16. All or nothing thinking17. Shoulds and musts
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18. Using feelings as the basis of a judgment, when the objective evidence does not support your feelings19. Basing future decisions on “sunk costs”20. Delusions21. Assuming your current feelings will stay the same in the future22. Cognitive labeling23. The Halo Effect24. Minimizing25. Magnifying (aka cognitively exaggerating)26. Cognitive conformity27. Overgeneralizing28. Blaming others29. Falling victim to the “foot in the door” technique30. Falling victim to the “door in the face” technique31. Focusing on the amount saved rather than the amount spent32. Overvaluing things because they're yours33. Failure to consider alternative explanations34. The self-serving bias35. Attributing strangers' behavior to their character and not considering situational/contextual factors
36. Failure to consider opportunity cost37. Assumed similarity38. In-group bias39. "You don't know what you don't know"40. The tendency to underestimate how long tasks will take41. The belief that worry and overthinking will lead to problem-solving insights42. Biased implicit attitudes43. The peak-end rule44. The tendency to prefer familiar things45. The belief you can multi-task46. Failure to recognize the cognitive benefits of restorative activitIes and those that increase positive emotions47. Positively biased predictions48. Cheating on your goals based on positive behaviors you plan to do later49. Repeating the same behavior and expecting different results (or thinking that doubling-down on a failed strategy will start to produce positive results)50. "I can't change my behavior" (or "I can't change my thinking style")
50 Common Cognitive Distortions -Alice Boyes, Ph.DWe Have to Learn To Work With Them
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Human Factors
41Source: http://danariely.com/2008/05/05/3-main-lessons-of-psychology/
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Human Factors
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How You Ask Impacts Decision Making!
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Distributed Leadership
The behavior patterns of those who lead people and teams.Team Science
The science of teams, their interdependencies and interactions.
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Team Science
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Why Team Science
It’s Not This…
45Image from https://828escaperoom.com/2018/10/27/team-building/
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KSA’s and Others
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Team Members Need to have the KSAs to provide the value necessary to meet the customer value.
{Devine, 2002 #8056}
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Hierarchy & Span of Control
Stop Managing People and Manage the Work Instead47Industrial Management - Alford 1951
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Questions? Charlie Protzman
www.biglean.com