Get Real (with the Schedule)!

Sales are on the rise, backlogs are growing, and additional capacity is needed before late orders start piling up. The team should be able to fulfill all orders on time but is only completing about 75% of the daily schedule on average. More overtime is scheduled, and more promises are made that the overtime will cease as soon as the late orders are cleared up.

Commonly, when businesses are struggling to meet order demand, it is because their plans are not realistic in the first place. Continuing to schedule mandatory overtime is analogous to telling the team that “the beatings will continue until morale improves!” The most crucial step we can take in a situation like this is to reset and provide the team with a schedule that we are confident they CAN make.

When we are not capable of producing at our “set” production rate for an extended period of time, we need to dig in and understand what has changed and where improvements can be made. Increased product complexity, reduced machine efficiency, or a less tenured workforce are just a few of the possibilities.

Releasing a schedule based on the demonstrated, achievable production rate conveys that leadership has realistic expectations and opens the door to identifying genuine issues and potential countermeasures. Sure, the order shortfall will still need to be made up, but even scheduling additional overtime at the achievable rate beats chasing an unachievable rate that inevitably pushes the team into overtime. In fact, often we see an initial increase in production rates as the scrambling to meet an outdated number is reduced.

In one case, I worked with a client whose baseline efficiency was calculated at 47%. The production standards were set in the early-1960’s and we were kicking the project off 50 years later. How could it be that in 50 years, the demonstrated production rate dropped by more than half? It turns out that the CNC machines, which were state of the art when installed, had been poorly maintained and were lucky to produce at half of their design rate. There were not enough welding machines to go around, so some employees were waiting for others. Enhanced safety regulations had impacted workflow on the floor and increased product complexity was resulting in a shortage of certain consumables. And with all of this and more going on, employee morale was at an all-time low.

We based new production targets on the recent, achievable baseline and started soliciting and executing upon improvement ideas. A TPM (Total Productive Maintenance) program was initiated for machines. Investments were made for new welders. We collaborated with employees on a new shop floor layout. Kanban and Vendor Managed Inventory were implemented for consumables. Most importantly, we began celebrating the little wins and rewarding employees for identifying and driving improvements. This is by no means easy work, but it is rewarding work, and it begins with realistic expectations.

Improvement Takes Practice

As a competitive cyclist and coach, I know that athletes need to spend time training in the areas that they want to improve. Carving time out of a busy schedule can be challenging for athletes training for an event or personal best, but it isn’t uncommon for recreational athletes to spend 6-8 hours per week training to develop their fitness and skills. Elite level athletes – yes, even those with families and full-time jobs – typically spend more than 12 hours per week training. What’s more, the training time per week needs to be consistent week after week to see any improvement at all. The bottom line? Improvement takes practice.

However, when I look inside small- to mid-size companies, it is rare to see any deliberate allocation of time for improvement activities… and it isn’t due to a lack of improvement objectives! New businesses spend time on growth, while established businesses spend time servicing day-to-day orders. In larger, more established businesses, we start to see meetings scheduled for improvement activities and discussions, but rarely will we see a set number or percentage of hours targeted and measured to achieve improvements.

With time targets in focus, imagine how dedicated improvement time can drive waste out of the system and result in even more available time for improvements. The effect is like turbo-charging your business, using the available energy sources to accelerate your results. Countless words have been written about how to make improvement efforts most productive, but isn’t the starting point to dedicate some time in that direction?

What about the business leader who is ready to consider how time is spent within their organization? Typically, we would start with an open and collaborative workshop comprised of a few team members. After setting some definitions for a few categories of activities, we can conduct some simple time-tracking for a short period of time to gain further insight into how employees are spending their time. Even the initial workshop goes a long way toward creating a common language among participants, and often results in a few immediate changes as team members become more self-aware of how they’re spending their time.

If you’re interested in exploring this topic further, and how your team might benefit from its application, don’t hesitate to reach out for further discussion. I always value connecting with local business leaders like you.

Walk The Wastes

If you have spent any time around Lean Manufacturing, you have likely learned about the 7 Wastes, and quite possibly have heard about Gemba walks too. These are two of the most effective concepts available to leaders in the realm of continuous improvement, and in this post, I will share how to apply these concepts in tandem to jumpstart improvements in your business.

First, some definitions:

The 7 Wastes are just that, 7 categories of non-value-added activities that can be found in ANY business. The seven categories of waste are Overproduction, Transportation, Inventory, Motion, Correcting Defects, Overprocessing, and Waiting. Future posts will dig deeper into defining these categories, but for the purposes of this post we need to accept that every business – even world class operations – contains many wasteful activities.

Gemba walks are a type of management walk on the shop floor aimed at learning and understanding what is really happening in the value stream. Gemba means “the real place” in Japanese, and these walks are essentially a refined version of “management by walking around.” Each Gemba walk should revolve around a particular theme, should be focused on process not people, and should prioritize findings over fixes. These walks enable leaders to discover and understand the daily struggles that employees face in their work and uncover information that could never be found in the boardroom or reading financial reports in the office.

As with the 7 Wastes, future posts on Gemba walks will delve deeper into the process, but the focus of this post is on the effectiveness of combining these two concepts. The 7 Wastes can become part of a common language within organizations interested in driving improvement, but sometimes getting started is tricky. There are many courses – free and paid – that offer to teach individuals about the 7 Wastes, and many do an excellent job of introducing the concept, but there is no replacement for practicing identifying real wastes in the workplace as a means of solidifying the learning. Incorporating each of the wastes into Gemba walk themes can be an excellent way to initiate both concepts in your business.

I have implemented this suggestion recently with two separate clients. Following some introductory training on the wastes, weekly Gemba walks were scheduled, with each week’s theme focused on identifying examples of a single waste in the workplace. Week one focuses on Overproduction, week two focuses on Transportation, and so forth. These clients are finding that the 7 Wastes serve as a perfect theme for practicing and refining Gemba walks, and that the Gemba walk approach is enhancing and leveraging the introductory training on the 7 Wastes.

Curious about where to start looking? Ask employees about the struggles they face in performing their daily work, and you will be well on your way to uncovering many examples of waste. Soon, the team will start to connect how the wastes impact one another and we can begin to think about tools and processes to reduce or eliminate waste.

As always, I love to read and respond comments or questions about this topic. In my practice, I regularly teach 7 Wastes and coach leaders on establishing and conducting effective Gemba walks, and welcome a discussion about the application of these concepts in your business.