February 23, 2014

Lean Thinking - James Womack and Daniel Jones - Book Summary


A presentation done by Dr. K.V.S.S. Narayana Rao on Lean Management

James Womack and Daniel Jones were involved in the MIT Project that came out with the book "The Machine that Changed the World." They further elaborated their ideas on lean enterprise in the book "Lean Thinking: Banish Waste and Create Wealth in Your Corporation."

Essential Background Reading to Understand Lean Thinking

Toyota Production System - Origin and Development - Taiichi Ohno

Taiichi Ohno on Industrial Engineering - Toyota Style Industrial Engineering

The Machine That Changed the World - Book Summary and Excerpts  1990



Lean Thinking - Book Summary


They proposed five lean principles and wrote one chapter on each principle

Five Principles of Lean - Womack and Jones


1. Value
2. Value Stream
3. Flow
4. Pull
5. Perfection

Case Studies on Lean Transformations

6. The Lean Revolution in Lantech
7. The Lean Revolution in Wiremold

Lean Thinking - Further Development



Professor Peter Hines, who worked with Daniel Jones, says that the five are not sufficient and proposed 8 principles

8 Principles Proposed by Professor Peter Hines

Purpose
Process
People
Pull
Prevention
Partnering
Planet
Perfection
http://www.atem.org.au/uploads/publications/-The_Principles_of_The_Lean_Business_System.pdf



Lean Thinking - Bibliography




http://www.atem.org.au/uploads/publications/-The_Principles_of_The_Lean_Business_System.pdf

http://ocw.mit.edu/courses/engineering-systems-division/esd-60-lean-six-sigma-processes-summer-2004/lecture-notes/1_1leanthinking.pdf

Peter Hines, Matthias Holweg, Nick Rich, (2004) "Learning to evolve: A review of contemporary lean thinking", International Journal of Operations & Production Management, Vol. 24 Iss: 10, pp.994 - 1011
http://www.emeraldinsight.com/journals.htm?articleid=849566&

The genealogy of lean production
Matthias Holweg
2007/3/31
Journal of Operations Management, Volume 25, Issue 2, Pages 420-437


Lean distribution: concepts, contributions, conflicts
Andreas Reichhart, Matthias Holweg
2007/8/15
International Journal of Production Research, Volume 45, Issue 16, Pages 3699-3722

The lean toolbox: The essential guide to lean transformation
John Bicheno, Matthias Holweg
2009
Publisher: Production and Inventory Control, Systems and Industrial Engineering (PICSIE) Books

2013
Rania A.M. Shamah, (2013) "Measuring and building lean thinking for value creation in supply chains", International Journal of Lean Six Sigma, Vol. 4 Iss: 1, pp.17 - 35
http://www.emeraldinsight.com/journals.htm?articleid=17084276


The role of Lean thinking in increasing resource efficiency in the UK food and drink supply chain
September 2013
http://www.oakdenehollins.co.uk/media/270/11668_20131114RevisedLeanresearchreport-DEFR01270FO0425_from_defra_website.pdf

A Conceptual Model of Lean Manufacturing Dimensions
Procedia Technology
Volume 11, 2013, Pages 1292–1298
4th International Conference on Electrical Engineering and Informatics, ICEEI 2013
http://www.sciencedirect.com/science/article/pii/S2212017313004817

Applying Lean Thinking to Software Development
Steven Peeters on Dec 05, 2013
http://www.infoq.com/articles/applying-lean-thinking-to-software-development

Principles of Lean Thinking - International Certificate Course - South Australia  Brochure
http://www.unisa.edu.au/Global/business/school/strategic/docs/education-programs/lean-management/Lean%20Thinking%202014%20print.pdf

2014
Lean Awareness 1 Day Workshops in  Melbourne, Sydney, Adelaide and Brisbane in 2014
Brochure
http://www.sapartners.com/wp-content/uploads/2014/01/Lean-Awareness-generic-brochure.pdf

Association for Manufacturing Excellence - Training Brochure
http://www.ame.org/sites/default/files/SW%20Region%20Newsletter%20February%202014.pdf

Article-McKinsey Quarterly - Next frontiers for lean - February 2014
http://www.mckinsey.com/insights/manufacturing/next_frontiers_for_lean

Article- McKinsey Quarterly Lean at Amazon
http://www.mckinsey.com/insights/operations/when_toyota_met_e-commerce_lean_at_amazon

Lean Management by CEOs

Lean is strategic issue. Efficiency is strategic issue. Lean Management is creating value for the customer efficiently. That is the definition of management given by Koontz and O'Donnell. But it is Toyota's manager who really proved by becoming world class company giving great quality at a lower price and beating the great American companies.

If lean is strategic, the CEO must understand it. He has to embrace it. He has to put it into his organization. He has to organize lean production facilities which are mainly cells that can produce multiple products in a continuous flow. He has to organize a lean supply chain. He has to direct his organization to follow lean practices. Of course, he has to ensure the directions and plans are being followed. Control system to ensure lean, value creation and efficiency are there.

There are some CEOs explaining their involvement in successful lean transformations.


TRU-TEST CEO DESCRIBES LEAN TRANSFORMATION
Tuesday 18 February 2014
http://www.intentgroup.co.nz/tru-test-ceo-describes-lean-transformation/

Lean is the Strategy
Art Byrne | 1 January 2013
http://www.leanceo.com/lean-is-the-strategy/

Interview with Ary Byrne - CEO Lean Implementer
Author of the book - The Lean Turnaround
2012
_____________

_____________


Value Adding Lean CEO - Presentation by Art Byrne
http://www.lean.org/downloads/Byrne_slides_cm3.pdf


The Lean CEO Must ‘Lead by Example'
In the book,  The Lean Turnaround, Art Byrne stresses the importance of the Chief  Executive
involvement for lean transformations to be successful.
http://www.tbmcg.in/misc_assets/newsletter/OpEx_0213_Book_Review_The_Lean_CEO.pdf


The Lean CEO Effect
There's a big difference between CEOs who engage in lean and those who simply encourage it.
Oct. 17, 2012
Jonathan Katz | IndustryWeek
http://www.industryweek.com/companies-amp-executives/lean-ceo-effect

The Lean Revolution in Wiremold - 1991 - 1995



Art Byrne joined Wiremold as CEO in September 1991. He found a classic batch and queue system in production, sales order taking and scheduling process and product development. The cycle time of products was four to six weeks. Order taking process was a week. Product development took two and half to three years from concept to launch.

In this company Art Byrne announced an early retirement package to the aging workforce. Almost all of the eligible hourly workers took the retirement offer, but only small fraction of office staff took the offer.  So, he has given to some of the office staff also a forced severance. (Is is right? This is the typical American way, which is in practice even today).

But when the planned manpower reduction has occurred, Byrne called a meeting of the entire workforce and announced to them that there will an improvement exercise in the company but nobody will lose job because of process and productivity improvements. The union did not believe it and went through the promise very carefully. But in the end they concluded that Byrne would honor his word and he has the plan and capability to do it.

But managers were sceptical. Byrne explained to them, while he expects good things to happen, if some expected fall in sales takes place there are tools to manage the downturn. Overtime can be reduced, surplus workforce can be employed in improvement projects, some outsourced components can be manufactured inside, work week can be reduced and new product line can be developed. We are going to make the operators more skilled and management will not be interested to lose highly skilled operators.

Art Byrne led the first training session in the company himself. Byrne implemented lean in his earlier companies. Based on a manual that he developed, he conducted a two day program for 150 people and followed it with a three day improvement exercise to provide opportunity to them to practice what they learnt.  He took them around the plant himself and showed them muda (excess resources being used every where). Then he told them that they are going to convert all activities into continuous flow activities that are activated through pull. He promised them the support of top Japanese consultants and trainers.

Soon hundreds of weeklong kaizen activities were started and improvements were made visible. The company was reorganised into six product families. Each team was given its own punch presses, rolling mills and assembly equipment.

A score board was setup which showed productivity of the team expressed as sales per employee, customer service as on time delivery, inventory turns and quality as rework inside and returns from outside.

The expectation per each time is 50 per cent reduction in defects, 20 per cent increase in productivity, 100 per cent ontime delivery, and inventory turns of 20 per year.

To help the teams to improve continuously, the JIT Promotion Office (JPO) was started. The product team leader and the JPO jointly evaluate the value stream(Order, production and delivery process) to determine kaikaku (reengineering a major portion of the process) and kaizen (local operation improvements) activities to be performed. JPO is given the major responsibility to get the projects implemented. The JPO also conducts training sessions and teaches every employee the principles of lean thinking (identifying value to be delivered to the customer, charting the value stream, flow and pull principles and continuous improvement for perfection.). The principles are to be reinforced in the organization periodically to stop people from reverting to the old habits.

The product development process was reengineered next.  Order taking process was made lean. Employees were given a share in profits.

Supplier improvement was done converting them into lean suppliers.

Lot of cash was released from the system due to reduction of inventory and was used buy some companies, which were converted into lean companies.

The benefits realized include doubling of sales per employee in five years, throughput time of one or two days, and  increase in operating profit of 600%.


Source: Lean Thinking
James Womack and Dan Jones
Simon & Schuster, 2003

February 19, 2014

Emotions – OB Perspective

Organizational Behavior Article Series

Emotions have received some attention in organization behavior literature.
Neal M. Ashkanasy et al., Emotions in the Workplace: Research, theory and Practice, Quorum, West Port, 2000.
Richard P. Bagozzi, “Positive and Negative Emotions”, in K.S Cameroon et al., Positive Organizational Scholarship, Berrett-Koehler, San Francisco, 2003, pp. 241-258.
___________________________________________________________



The best description of emotion would be how a person feels about something.
Emotions are reactions to an object. They are not traits. They are object specific.

Types of Emotions


Positive Emotions:  Love/affection, Happiness/joy,  Surprise
Negative Emotions: Fear, Sadness, Anger, Disgust, Shame

Emotions can be shown as a continuum.

Happiness - Surprise - Fear - Anger - Disgust.

Emotional Labor


Some employees have to put in emotional labor as they have to control their emotions in the presence of provocation and show the behavior that is expected from them because of the job they are performing.
Emotion labor has dysfunctional consequences for the employees doing it (e.g., stress and burnout) [Luthans, 2005]. Some companies try to hire only those with very positive personalities. They tend to express genuine positive emotions instead of positive emotion which is result of emotional labor.

Recently emotional intelligence became a popular concept. The topic ‘emotions’ is now part of OB texts as emotional intelligence emerged as an important concept in OB.

Emotional Intelligence


Peter Salovey and John Mayer are usually given credit for developing the theory and definition of emotional intelligence first. Salovey and Mayor defined emotional intelligence as "the subset of social intelligence that involves ability to monitor one's own and others' feelings and emotions, to discriminate among them and to use this information to guide one's thinking and actions.


Daniel Goleman, the author of "Emotional Intelligence" explains emotional intelligence as "the capacity for recognizing our own feelings and those of others, for motivating ourselves, and for managing emotions well in ourselves and in our relationships."
Goleman classified this emotional intelligence and skill into two components: one component is related to self and the other component is related to dealing with others.
In the component dealing with self, the stages are self-awareness,self-management and self motivation. In the component dealing with others the stages are empathy and social skills.

Goleman makes the positive statement that emotional intelligence and competence continues to develop and grow. In a study, if was found that, measured EI of college students increased in a range of 50 to 300 percent after a course designed to enhance their EI.

EI helps people to get along with others and also to manage themselves in highs and lows of life. Therefore, it is not surprising that there is some longitudinal research indicating EI to be a better predictor of life success than IQ.



References
Luthans, Fred (2005), Organizational Behavior, 10th Edition, McGraw-Hill, New York


Article originally posted in
http://knol.google.com/k/narayana-rao/emotions-ob-perspective/2utb2lsm2k7a/105#

Related Articles

February 1, 2014

Stress Test of Strategy


McKinsey Provides the following ten questions as stress test of your strategy. It is a test of the output of your strategy process.


Test 1: Will your strategy beat the market?
Test 2: Does your strategy tap a true source of advantage?
Test 3: Is your strategy granular about where to compete?
Test 4: Does your strategy put you ahead of trends?
Test 5: Does your strategy rest on privileged insights?
Test 6: Does your strategy embrace uncertainty?
Test 7: Does your strategy balance commitment and flexibility?
Test 8: Is your strategy contaminated by bias?
Test 9: Is there conviction to act on your strategy?
Test 10: Have you translated your strategy into an action plan?

All the ten questions are given an explanation and additional reading from McKinsey quarterly is indicated in the article Have you tested your strategy lately?