The Lean Enterprise Removing barriers to human potential
New United Motors in 1986… • Super clean • Super orderly • High quality products • High morale workforce
New United Motors in 1986… • How do they keep this plant so clean? • How do they keep it so orderly? • Why does the workforce look energized and happy? • What’s happening that makes this plant so different from others?
It’s all about human potential… • In 1923, Henry Ford wrote a little book called, “My Life and Work.” • This book is quite possibly one of the most important books written about manufacturing in the 20th Century. • Why? • Because it describes the basics of a system that 38 years later some folks at MIT would call lean manufacturing.
Lessons learned from Henry Ford… • “If there is any fixed theory—any fixed rule—it is that no job is being done well enough. The whole factory management is always open to suggestions, and we have an informal suggestion system by which any workman can communicate any idea that comes to him and get action on it.”
Lessons learned from Henry Ford… • “No manufacturer can say: ‘I built this business’—if he required the help of thousands in building it. It is a joint production. Everyone employed in it has contributed something to it.”
Ford and lean work processes… • Henry Ford’s ideas later were used by Toyota, as they developed the Toyota Production System. • Lean work processes are transforming manufacturers, and a wide variety of businesses and service organizations throughout the world. Chrysler, GM, and Ford are heavily committed to the implementation of lean processes. So are their first and second-tier suppliers. • Lean processes are being used world-wide to transform work processes in hospitals and other healthcare facilities. • “Lean” beliefs and practices are transforming organizations in all sectors of our economy.
Lean transformations are driven by… Some basic assumptions about the nature of work and the nature of workers… and Some assumptions about the degree to which workers can be trusted. The basic assumptions undergirding mass production are quite different…
Mass production on work and workers… • Workers only work for a paycheck and benefits. • The amount of information to which workers have access needs to be strictly controlled. • The average worker has very limited interest in improving work processes. • The typical worker doesn’t have the ability to make significant individual contributions to improved product quality or productivity.
Workers are biological robots… • Trained • Controlled • Directed
“Lean” on work and workers… Creative Concerned
“Lean” on work and workers… Knowledgeable A Partner
Basic Beliefs of Lean Organizations • Any company’s most valuable assets are the knowledge and creativity of its workers. • Unleashing this knowledge and creativity is the primary responsibility of management; no other responsibility trumps this one. • Before any company builds a product or delivers a service, it has to build the knowledge of its workers. This is what it takes to develop a lean workforce.
Developing a lean workforce… It’s possible It’s difficult Managers and Supervisors are the key to success… They can also be a barrier
Developing a lean workforce… A basic barrier to lean…
What do you think employees value? Job Security Promotion & Growth Good Working Conditions Help with Personal Problems Loyalty to Employees Good Pay Interesting Work Full Appreciation of Work Done Tactful Discipline Feeling of Being in on Things
What do managers believe employees value? • Good Pay • Job Security • Promotion & Growth • Good Working Conditions • Interesting Work • Tactful Discipline • Loyalty to Employees • Full Appreciation of Work Done • Help with Personal Problems • Feeling of Being in on Things
What do employees value? • Interesting Work • Full Appreciation of Work Done • Feeling of Being in on Things • Job Security • Good Pay • Promotion & Growth • Good Working Conditions • Loyalty to Employees • Help with Personal Problems • Tactful Discipline
A significant disparity… Managers Employees • Good Pay • Job Security • Promotion & Growth • Good Working Conditions • Interesting Work • Tactful Discipline • Loyalty to Employees • Full Appreciation of Work Done • Help with Personal Problems • Feeling of Being in on Things • Interesting Work • Full Appreciation of Work Done • Feeling of Being in on Things • Job Security • Good Pay • Promotion & Growth • Good Working Conditions • Loyalty to Employees • Help with Personal Problems • Tactful Discipline
Driving Lean that Sticks…. Means doing first things first
At an Ernst & Young Seminar in 1984…. • Why have you only asked about tools? • Why hasn’t anyone asked about beliefs? • Why hasn’t anyone asked about values?
Lean is more than orderly and clean • Lean is about developing a work environment in which everybody is continually looking for ways to improve work processes • Lean is about developing a work environment in which everybody is continually generating ideasabout how to eliminate waste from work processes • Lean is about fully engaging the creativity, imagination, and energy of everybody
A fully engaged workforce… “We build people before we build cars.”
A fully engaged workforce… Toyota Camry Plant in Georgetown, KY 10 years after 5S implementation 6,500 process improvement suggestions per year Number of process improvement suggestions per employee/year
A fully engaged workforce… • Western Pennsylvania Hospital • Time spent between signing in and registration: 2 hours to zero. • Time spent registering patients: Between 12 to sixty minutes to three minutes • Number of unnecessary blood bank reports issued: Between 10 and 11 to zero • Shadyside Hospital • Nurse time spent on patient-controlled anesthesia pumps: Reduced by 2,900 nurse-hours per year. • Patient fall rate: Dramatic decline. At one point, the unit went 95 days without one.
A fully engaged workforce… • Allegheny General Hospital • Number of patients suffering from intravenous infections: 37 in one year to 6 the next. • Deaths from intravenous infections: 19 in one year to 1 the following year. • Flinders Medical Center (Australia) • Emergency Department waiting time down 25 percent. • 70 percent of patients in ER discharged within 4 hours. • Number of patients leaving ER without seeing a physician fell by 41 percent.
A fully engaged workforce… • Bolton Hospital (UK) • 70 percent reduction in the number of steps needed to complete most tasks. • 40 percent reduction in floor space needed. • Up to 90 percent reduction in the time taken for a department to do its job, achieved with less staff and limited technological investment. • Non value added tasks reduced by 49%. • Flow time for blood samples reduced from 300 to 35 minutes. • Reduced staff “journey” distances by 80%. • Identified ₤300,000 improved income in laundry through lean redesign.
It can happen… Transformed Work Spaces
It can happen… Transformed Work Processes
It can happen… Transformed Workers
Lean could transform your facilities… We’d like to partner with you in making this happen