How lean are you? Part 3

This is the third post in the How Lean are you? series.

In a previous post I described the awareness/performance matrix to assess leanness.

Such a matrix is interesting for comparing leanness of different units, e.g. divisions, factories, business units or companies. Every unit can be placed onto the matrix according its score relatively to the two dimensions, awareness and performance.

The related metrics will be discussed in another post.

The plots – showing each unit’s performance – deliver an overall view of the situation and dispersion. This kind of benchmark is very interesting for observers, e.g. researchers, CEOs, top management, etc.

It is also of high interest for benchmarking participants, as they can compare how they perform relatively to others.

Author, Chris HOHMANN

Years ago I was involved in a European-wide study about lean in automotive industry.

Our consulting firm launched the study and needed data for it.

With the help of a specialized and renown magazine, we invited companies who could qualify to answer a questionnaire. In return every participant would receive a scatter diagram with their own plot identified among the anonymized mass of all participants.

This offer had several advantages:

  • Granting anonymity alleviate the legitimate reluctance to give away information regarded as confidential in a very competitive and aggressive business.
  • Granting anonymity encouraged respondents to be honest with their answers, first because they would not be identified (no shame), second because expecting the same from the others, it was a chance to get a true image of one’s position relatively to all the others.
  • Getting this benchmark for free (except the effort of answering) without the fear of disclosing anything confidential was appealing and ensured the success of the study.

Over years, the study gathered more and more data and we analysts were able to add the timely dimension of lean transformation, for instance how long it takes to move from one performance level to the next.

>Part4: Measuring leanness and Benchmarking

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How lean are you? Part 2

In previous post I described the lean awareness assessment, a relatively simple but not very effective way for assessing leanness.

Its weak point is the assumption lean awareness and operational performance are correlated and this causation is taken for granted. While this assumption makes sense and may be true, experience shows that this cause-effect relationship is not systematic.

It soon becomes obvious that Lean awareness should be checked versus operations’ performance level. This adds a second dimension to the assessment and allows scoring within a two dimensional matrix.

 Bandeau_CH1

Four basic cases

A simple four quadrants matrix is very helpful to categorize an organization among four basic types. Instead of naming each type and explaining it I invite you to read the explanation and guess the name.

Lean Assessement Matrix

1) high awareness low performance

As described in previous post, many organizations may have very lean aware executives, managers, techs and personnel but there is no evidence of lean benefits on shop floor nor in operation’s performance indicators.

While concepts, methods and tools are known, at least in executives’ level, there is little evidence of them in ops and performance is low in comparison of other competitors or similar companies.

I call these organizations “theoreticians”.

2) low awareness high performance

These organizations perform well but at the expenses of their resources. The products are manufactured and delivered at high costs and/or capacities as well as material are wasted. Manpower is sweating to achieve these results or staff is plenty, more than really necessary or staff is working overtime often.

I call these organizations “effective” as they deliver timely (when really required) the awaited products and hopefully make some profit despite all the wastes. Profit could be higher, costs lower or spent energy more reasonable.

Until recently pharma industry was in this category, as sales profits were so high it wasn’t meaningful to strive for leaner operations, any investment in additional capacity eventually paid off. In case of pharma, capacities have often been wasted, low OEE being compensated by investments in additional capacities. Quality is worshiped at a point that any doubt leads to product or material destruction rather than trying to master processes. Times are changing and pharma has to consider leanness.

3) high awareness high performance

This quadrant is the quadrant of best in class, of operational excellence. Knowledge of Lean principles, methods and tools translate into operational practices, yielding good results at lowest costs and resource consumption.

These organizations are “efficient”.

4) low awareness low performance

The last quadrant is the all-danger zone in which the organization shows no awareness about Lean principles, methods and tools nor good operational performance.

If this is a start-up, it is understandable (but no excuse, Lean start-ups do exist!) but in any case this company should react swiftly and jump out of this deadly corner of the matrix.

I found no suitable name for organizations in this quadrant, feel free to suggest one!

When facing such a case in my consultant job, I urge the top management to get out of this “endangered” position, my best naming so far.

What course?

From low/low to high/high, no interest to lose time getting theoretical knowledge first (quadrant “high awareness low performance”) as performance is more important for immediate survival than knowledge. In a pragmatic way, it’s okay to go for “low awareness high performance” first, and then working to get efficient, thus heading for high/high.

Another route, more ambitious, is to head straight for high/high, trying to both improve performance and lean maturity. This may be difficult and risky.

>The next post deals with how to plot the position point in the matrix.

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How lean are you? Part 1

This is the first post of the “Lean assessment series” dedicated as its name tells to organizations’ leaness assessment.

One common and easy way to assess leanness is to check the organization’s lean awareness. This is usually done using a five level scale ranging from “barely any knowledge” to “top awareness”.

Assessors use question grids and score awareness according to answers and sometimes proofs and evidence. In the example below, the grid is built on five levels reflecting the judo / Six Sigma belt hierarchy. A set of questions or statements faces each level. If the respondent meets the requirements enclosed in questions or statements, the level is checked.

Lean Assessment Grid

Lean Assessment Grid

These grid usually come with reminders of proofs and evidences the assessor can ask or seek.

The assessment uses several grids, one per theme, several topics per theme, several items per topic, structured like this for example:

 Assessment Grid structure

One common way to summarize the results of all grids is to display a radar chart. Each theme is shown on an axis, the leaner , the more the surface covers the graph. Indents in the graph show the fields candidate for improvement.

Radar Chart

This kind of assessment is rather basic and assumes lean awareness leads to better performance as lean-aware organizations are supposed to think and act according to lean principles and use lean tools and techniques, thus are more efficient.

In reality I haven’t seen many lean-aware organizations, rather some lean-aware executives and middle managers with waning souvenirs about this or that tool.

This leads to the illusion of top management and the clear cut in the pyramid.

Cut in pyramid

While the lean aware top management believes lean tools and principles they mentioned or even promoted have dripped down to the shop floor, the latter has no knowledge and does not use any of them.

As top managers seldom tour the gemba and don’t pay much attention to the shop floor trivialities, they keep sitting in their ivory tower believing Lean tools and principles are in place.

The correlation between lean awareness and operational performance is not questioned either.

In the next post, we’ll see how to improve Lean assessment adding one more dimension.

>How Lean are you? Part2

You may also like: The fallacy of maturity assessments


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The Lean Advancement Initiative (LAI) at MIT offers LAI Self Assessment Tool (LESAT) for free download: http://lean.mit.edu/products/lai-self-assessment-tool-lesat-2