Lean method – Lean Six Sigma Group

Improve your organisation with Business Process Management

Sebastiaan Kooijman — Thu, 02 Jul 2020 17:53:52 +0000

Business Process Management

BPM, for short, includes everything that has to do with processes within an organisation. An example would be mapping out and improving processes.

But why would you use Business Process Management?

Processes make sure an organisation keeps its customers satisfied and possibly makes profit. It is important to keep these processes structured and maybe even improve them. BPM is concerned with these tasks.

The four steps of Business Process Management

BPM can be divided in four steps:

Process identification
Mapping processes makes it easier for employees to get an oversight of all tasks and streams within an organisation. This “map” shows all processes and their relations to each other.
Process description
By using a Makigami of een Value Stream Map (VSM) you will start describing these processes that have been mapped out. A SIPOC contributes by determining who is involved in these processes. Which tool you choose, depends on your final goal.
Process analysis
In this phase, you fulfill tasks that lead to the final phase: process optimisation. You will, for example, collect data of systems from which you will conclude something in the next phase. If there is no data that can be trusted, then wait no longer and start measuring.
Process optimisation
There are many ways in which a process can be optimised. Lean provides your organisation with many tools. A well-known tool is looking at processes from the perspectives of seven different types of waste. Determine whether the process adds value for the customer. If not, these can be eliminated. However, sometimes there are processes that do not add value, yet are legally required.

Het bericht Improve your organisation with Business Process Management verscheen eerst op Lean Six Sigma Group.

Process analysis using Lean

Sebastiaan Kooijman — Thu, 25 Jun 2020 09:41:42 +0000

Organisations are continuously striving towards a better position than their organisational rivals. They are working on continuous improvement and optimising their business processes. These are focused on improving the quality of a product or service, to create more efficiency regarding the business processes. Process analysis is a part of this process optimisation. But how does Lean help here?

The definition

It is important to focus on what a process actually is. At the beginning of a training, we usually task our participants the same question. It then becomes clear how hard it actually is to define what a process is. There is no clear definition, however we say:

A collection of activities of process steps that are converted into in- and outputs.

Different levels

It is important to distinguish different levels of a process:

Chain level– Process of organisations within the same context;
Business process– The architecture of a business to fulfill the needs of a customer;
Work process– These visualise the way business processes work;
Process step– Give an insight in the tasks that are carried out;
Action/activity – The way a specific tasks or process step is fulfilled;

Map the current situation

To analyse a process, it is important to visualise these. There are many techniques to do so. A well-known technique is the Value Stream Map. This is often carried out by the use of a ‘Brown Paper-session’. In here, details of work processes are mapped out by describing activities and process steps.

The actual process analysis

The analysis of this current, mapped out situation is done to collect data about the goal that is set for an organisation. This goal must be mapped out as well and takes on a futuristic role: what would we want the process to look like? Or more importantly: how should the process work?

After specifying the goal(s), it becomes possible to work towards these. By now, it should become clear which parts of the organisation could use some more attention. A process analysis focuses on identifying possible bottlenecks or waste. Where do these points occur? Are there certain points in the organisation where fails occur or work is not done very efficiently?

Using this process analysis, the quality of products and services can be improved. Possible improvements are mapped out; these can lead to decreases of costs. And in the end this leads to more efficient processes. It gives you the opportunity to view your organisation from ‘the outside’ and be critical. The collaboration between employees is improved as well; they will get a collaborative image of all processes and take their responsibilities to achieve continuous improvement.

Het bericht Process analysis using Lean verscheen eerst op Lean Six Sigma Group.

Implement Monozukuri in your organisation

Jelle Marius — Thu, 25 Jun 2020 09:21:23 +0000

Monokuzuri

Has your organisation started using Lean? But are you worried this is not going as well as you would like? Then Monozukuri might be your solution!

What is Monozukri?

The term itself is made of the two Japanese words ‘mono’ and ‘zukuri’. These stand for ‘the thing’ and ‘production process’. In other words, Monozukuri does not only focus on the tools of continuous improvement, but on the corresponding culture as well. Not only does this comprise the technique of continuous improvement, but the social aspects too. I mean, it is important to satisfy your employees, right?

Why do trajectories of change fail?

Even though organisation make the decision to implement the philosophy Lean, failure can still occur. In Japan, people wondered why the implementation of World Class Management failed. They concluded there were two streams that actually were not connected and did not strengthen each other. These are called the product value streams and value stream of humans. The product value stream includes the stream of the first phase to the end product. The value stream of humans entails the employees of an organisation.

The streams of the product value stream have split up due to a lack of attention to short-term performances. Employees therefore lost their ownership to improvement. Fortunately, improvement was still made, but not because of intrinsic motivation.

These two streams can, however, still be connected to each other by working together. And when they have met again, continuous improvement will happen again; this is in the organisation’s DNA. This also includes managing your employees, because they should be stimulated!

The execution of big adaptation of projects can only become successful when using the right management system and a Change Management Plan. Monozukuri is an example of such a system, which gives structure to initiatives regarding improvement within companies. By different teams with many functionalities and a focus on the organisation’s goal, this can be achieved. End-to-end costs are improved this way. And this might result in excellerating people and machines in order to achieve maximum value for customers.

Monozukuri’s three pillars

Monozukuri stands on three pillars, each existing of three aspects. These focus on producing the least costly and excellerating continuous improvement.

1. Product & Development

Design-to-Cost
Design-to-cost is a systematic approach to control the costs from design to production. By making certain decisions during the concept phase, it becomes easier to prevent costs in later phases.
Standardisation
Standardising the process, including in- and output, makes it predictable. This leads to quality and creates the opportunity to easily maintain knowledge about products and processes.
“Tier-N-Supplier” Optimisation
By actively involving suppliers in the production process, the number of suppliers in between processes can be decreased. Transparency and teamwork are crucial.

2. Production

Lean manufacturing
Lean strives towards a process containing the least waste and an optimal flow, which adds maximum value to the customer. The employees of organisation using Lean take on a central role, because they are used to generate improvements. Continuously.
Make vs. Buy
The costs and advantages regarding processes of productions of products or services are compared with different companies who make use of the same processes.
Digitalisation
New technologies fasten production processes. This leads to smarter software, robots and sensors.

3. Supply chain

Cost to serve
Cost to serve calculates the costs that are needed for the process of producing to delivering to the customer. Every product regards many activities, due to the fact that every process and every customer differs.
Design to logistics
Design to logistics is a concept where a collaboration between product and development takes place. This way, the costs of distribution are decreased, in order to optimise the customer value.
Tasks
The supply chain makes sure a clear task division is made. However, a clear insight regarding the responsibilities of the organisation for their customers and suppliers is unmissable as well.

Teamwork, however, takes on a central role within these three pillars. Because this does not only make the product value stream successful, but the value stream of humans as well.

Het bericht Implement Monozukuri in your organisation verscheen eerst op Lean Six Sigma Group.

How to become a viable organisation?

Reinier Tromp — Thu, 25 Jun 2020 08:23:40 +0000

Viable organisations

Viability becomes more and more important. It is important to be able to adapt to your environment nowadays. Not only organisations have noticed, but individuals have as well. But what actually is viability? And how do you become a viable organisation?

But what is a viable organisation?

When would one say an organisation is viable? There is no clear definition, but viability means being able to adapt quickly to changing environments. It is basically another word for agility. This is why these terms are used to refer to the same meaning. Imagine the demand of trainings being cut in half, for example due to the corona crisis. How fast would your organisation be able to adapt? This would define your adaptability, or viability.

How to create viable organisations?

The way in which responsibilities are assigned is important in the creation of viability. An organisation that is structured hierarchically with many layers will not be very viable. Decisions take a long time to make due to all these layers. An organisation without all these layers, is more viable. Creating Agility within your company allow employees to make their own decisions and therefore possibly make mistakes. Because this is what Agility is about too. Earlier, not only time was invested in consideration, but in analysis as well. This way, risks could be decreased.

For whom will you become Agile?

Not only the question of how to become a viable organisation is important. The question of why might be even more relevant. For whom will you become viable? Creating maximum customer value is your final goal. Will your customers be able to notify the added value of all production processes and is he or she willing to pay for these? Remember that not every adaptation can be considered an improvement.

Het bericht How to become a viable organisation? verscheen eerst op Lean Six Sigma Group.

Customer value according to Lean

Sebastiaan Kooijman — Thu, 11 Jun 2020 12:28:23 +0000

As an organisation, you should improve continuously and keep developing in order to live up to the ever-changing environment regarding customer value. When handling according to agreements your company made about fulfilling the wishes of the customer, your organisation will do right. But what is this customer value? And how does Lean contribute to this?

What is customer value?

This term knows many definitions and there are many methods to determine this value as well. In relation to the Lean philosophy, the meaning behind customer value actually goes deeper than just this value. It means a product or service is delivered that satisfies the customer. He or she might choose to order from your company again.

But it is not the same thing as customer demand. Customer demand focuses on fulfilling the need of customers. However, often the customer him- or herself does not even know the need is there. The process of becoming conscious of these needs is important to companies. Here, you can gain customer value.

Why is creating customer value so important?

Creating customer value contributes to the growth of organisations. The ability to distinguish yourself as an organisation becomes more and more important with this market of competition. Simultaneously, customers are demanding more of products and services.

The increasing complexity and customers becoming more critical leads to a transition to a demand-economy. The focus is not on the current stock and how to reach the target group, but on what the target group wants and how to meet those requirements.

Organisations without commercial intent, think of schools or hospitals, have noticed the switch to the focus on customers. However, because the administrative work increases, some tasks of the core of the organisation have become really pressured. Even when looking at the government, it sometimes lacks focus on the ‘customer’, also known as citizens.

Every single one of these Dit vraagt om een significant andere benadering, waarbij problems have one thing in common: a switch towards customer needs should be made. Lean can contribute significantly to this.

How can customer value be improved?

Organisations know many ways to respond to customer needs. And these entail flexible processes that focus on the customer. The Lean philosophy supports with a structured approach that improve these processes.

While using tools and techniques that define the customer value, it becomes possible to examine which business processes supply added value. Those that do not should be minimised or even eliminated. Because in the long run, this will lead to more ‘spare’ time that can be applied to increase the customer value.

But keep in mind you should not only focus on the external customer. Every process has to do with a customer and these corresponding business processes create an output to colleagues or employees of other departments. When you, as an employee, see your own colleagues as (internal) customers as well, your collaboration will improve and intensify. Not only for you, but for your entire organisation and the external customers. This way, the common goal can be achieved: creating customer value.

Het bericht Customer value according to Lean verscheen eerst op Lean Six Sigma Group.

How Supply Chain Management will support your company

Sebastiaan Kooijman — Thu, 11 Jun 2020 12:03:02 +0000

Lean & Supply Chain Management

Customers, either B2B or B2C, make decisions based on delivery time. One would like this to be as short as possible. They want the stock to be small, because this takes up space and can be very costly. These are the reasons companies become motivated to lessen the lead time. A corresponding discipline is called Supply Chain Management, which we will elaborate on in this blog.

The connection between Lean and Supply Chain Management?

Lead times are linked to stock and the end product. Lack of products can lead to certain delays, which is an unwanted incident to the customer. And he or she will not pay for such services. Supply Chain Management, however, gives a company a system that continuously provides them with stock, purchased at a suitable price and at the right moment.

How can Lean principles be used to support companies this way?

1. Value

Supply Chain Management starts with the customer. What is their demand? Or in other words, which requirements must these products meet? When do they need to be delivered and what is the quantity? As a company, you should know the Voice-of-the-Customer. That should support the entire planning.

However, the main idea of Supply Chain Management regards the fact that every entity within the chain can be considered a customer themselves. This is why it is even more important to make clear agreements with other suppliers. Especially when thinking about these lead times that should be decreased, it is relevant to have a clear image of the competence of your suppliers. It might be possible they can take over part of the production at less costs than you would be able to. This would be time-efficient for you as well.

2. Valuestream

ICT-systems are a bit part of Supply Chain Management. This is sometimes called Enterprise Resource Planning (ERP). There are actually many possibilities regarding ICT. The main advantage is stock and suppliers are always orderened. The disadvantage, however, it might increase the amount of administrative work.

These ERP-systems are meant to produce more time than it costs. This becomes possible due to overlay between departments. For example, the sales department enters orders that have come in, production makes a planning based on these orders, finances sends out the corresponding invoices and customer support gets insight in the history of orders from specific customers. To conclude, it does still happen sometimes that companies keep up too much administrative work, which has become unnecessary.

3. Flow

Flow can be considered the most important Lean principle when talking about lead time. This actually creates a continuous stream of production. A waiting time might arise when some parts are not present when using Supply Chain Management. You could state that the something went wrong regarding the communication between departments. And this is not that bad! Make sure the entire company learns from these mistakes and keep improving continuously.

Another noticeable mistake in many companies is the fact that employees need to look for things they might need. An example might be chaotic closets. And frequently, these closets do not even strike employees as messy. This happens because there must have been some sort of system before, yet there is not now. Make sure you immediately make a change. This leads to loss of valuable time and possible frustrations, so it does not need to be said this must be solved.

4. Pull

Pull starts at production when a customer has placed an order, not just at any time. This has positive impact on the stock, which thus decreases. Supply Chain Management is an essential here, because it is used as a form of communication between the different departments.

This, however, does mean a company should have a short lead time, because customers will switch companies whenever they would feel like it takes too long to receive their orders. “If you can’t beat them, join them”, might be the best strategy. And let this be the reason why Amazon is as successful as they are. When this company was conducted, it put much more pressure on companies delivering products to customers in the Netherlands.

5. Perfection

Already in possession of a process that works efficiently? Make sure you standardise this process and create clearance for your employees. These processes should always be transparent. If this is the case, there is always room for continuous improvement.

Supply Chain Management and Lean principles come together. They both avoid waiting time, failures, stock, bottlenecks and other frustrations. However, you should stay critical. Keep track of the value stream!

Het bericht How Supply Chain Management will support your company verscheen eerst op Lean Six Sigma Group.

Rate the outflow to meet the customer demand

Reinier Tromp — Thu, 11 Jun 2020 11:48:04 +0000

The rate of outflow

As a company, you want to meet the customer demand. But how fast do you want to do so? You should have a vision and strategy based on the customer demand. Because, logically, customers do not like to wait. The question remains if you are able to satisfy enough customers per day, or even per minute? This is called the rate of outflow.

Calculation of the rate of outflow

Imagine twenty orders of three meals have been placed. The customers that have ordered those arrive one minute apart. This means, sixty meals should be prepared in the kitchen. However, customers do not want to wait any longer than twenty minutes; one would say the lead time is twenty minutes. The rate of outflow can be calculated by dividing the amount of work yet to be finished by the lead time. In this case, this would mean (60 (amount of meals))/ (20 (lead time)) = three meals per minute. The first three customers that have arrived, should wait twenty minutes. The customers that arrive later wait twenty minutes as well. But in the end, no customers will have waited longer than twenty minutes. This system is balanced out! However, when customers arrive whose lead time is no longer than ten minutes, the system does not apply anymore.

Another example:

It often takes up to six weeks to gain a license from the township. On average, there are sixty applications to process. The rate of outflow would therefore be 60/6 = 10 licenses per week. But imagine citizens agreeing with three weeks per license. What would the township do? They adapt their processes to satisfy their customers. This means the rate of outflow would then be 60/3 = 20 licenses per week, which means it has doubled! The law that we have used twice up until now is called Little’s Law. John Little was an American who proved this law in 1961. He is considered the founder of the science of marketing.

Het bericht Rate the outflow to meet the customer demand verscheen eerst op Lean Six Sigma Group.

Theory of Constraints

Sebastiaan Kooijman — Thu, 04 Jun 2020 13:32:23 +0000

A frequently returning term regarding processes is called a bottleneck. This means some kind of work overload is present. When these processes are improved, more effective result can be achieved. And thereby, more profit is obtained. This is called the Theory of Constraints (ToC).

What is the Theory of Constraints?

This methodology focuses on discovering the most limitative aspect of a process. This bottleneck is then eliminated systematically. Every (complex) system consists of more than one connected activities. Sometimes it becomes hard to focus on what is really important because of this. However, the Theory of Constraints aims at focusing on the goal your organisation wants to achieve and provides you with a set of tools to do so. There are three aspects of ToC:

The five steps of focus
Identifying and eliminating limitations.
The process of thinking
Tools for analysing and solving problems.
Throughput Accounting
Measuring performances and supporting decisions from the management team.

When analysing the processes within an organisation, there can be different types of limitations. ToC focuses on the one with the highest priority: the current limitation. Therefore, ToC tends to be the perfect methodology for the creation of fast improvements.

The five steps of focus

Identify the limitation
Identify the current limitation – or bottleneck – in the process.
Exploit the limitation
Make improvements as to tuning out the limitation while using the correct resources.
Make sure everything is inferior
Take another look at all activities in the process, in order to make sure they support the needs of the limitation.
Evaluate performances
If the limitation still exists during this step, think about eliminating other activities as well. Repeat this step until the limitation is actually removed. And keep in mind this sometimes means investments should be made.
Repeat the process
These five steps of focus are walked through in a cycle In other words, when one limitation is removed, the next can be handled immediately by starting at step one again.

The process of thinking

This tool has been developed to retrieve the unwanted effect of a limitation and replace it with a new one. Three questions that should be asked to do so are:

What should be changed?
To what should it be changed?
Which precise actions lead to this change?

Below, you can find some tools that can be applied to fulfill the idea of the process of thinking.

Current reality tree
Describe the current situation.
Evaporating cloud tree
Evaluate potential improvements.
Future reality tree
Describe the future situation.
Strategy and tactics tree
Compose a plan of action regarding improvements.

Throughput Accounting

Throughput Accounting is an accounting methodology which tries to eliminate harmful disturbances. It actually arose from traditional accounting methods that threaten the profit of an organisation to decrease. ToC makes an organisation mandatory to sell the entire stock in the foreseeable future. This might lead to an increase of profit on paper, but in reality, stock takes up this profit while it is still unsold. And this same money could be used to make other investments. However, ToC finds decreasing costs less important than focusing on the flow of products.

As said, ToC focuses on throughput accounting with the most important pillars: throughput, investments and operational costs.

Throughput
The time in which products are sold to customers.
Investments
Money that is tight to the organisation instead of usable: stock, machines, building(s), et cetera.
Operational costs
Money that is invested in the throughput of an organisation.

What are the advantages of the Theory of Constraints?

By applying ToC, the following advantages arise:

Increase of profit;
Quick improvements;
Improved capacity – by eliminating constraints, an organisation becomes able to produce more and more;
Decrease of lead time – the process flow will improve;
Less stock – the amount of work within a process decreases.

Some examples of ‘Constraints?’

Constraints can be defined as everything that limits an organisation in its progress. In other words, it keeps an organisation from its goal(s).

Physical
This includes actual equipment, but other tangible things such as lack of employees or space or shortage of material as well.
Policy-wise
The recommended way or working, procedures of the organisation or written agreements.
Paradigm
This category contains things such as habits. Think of “Machines should be turned on and working 24/7 in order to keep costs per product as low as possible”.
Demand of the market
When an organisation produces more than the market demand, it is categorized under demand of the market.

To conclude, the Theory of Constraints is able to assist you with solving problems regarding limitative factors within your organisation structurally. By applying this method cyclically, your organisational processes will improve continuously.

Het bericht Theory of Constraints verscheen eerst op Lean Six Sigma Group.

Be ready for the future – use automation!

Jelle Marius — Thu, 04 Jun 2020 13:07:24 +0000

It is impossible to ignore the fact that the world is moving towards a better, more sustainable future. Even within the organisation and other businesses, this should be implemented. But how? In this blog you will read about new technologies to optimise processes and the importance of teamwork. Because by motivating each other and working together, an organisation will become ready to face the future, for example by automation.

Automation of processes

Many grander organisations have laid their focus on automatic process. The prediction is smaller organisation will do the same rather soon. And this will only continue to happen more and more. For starters, only simple, repeatable process steps will become automatic, but in the long run, other processes will too. Process optimisation is part of the automation of processes. And the goal is to let processes run more efficiently, make them less work intensive, decrease risks and make the organisation more profitable.

To keep up with the fast-changing technological developments, RPA was created. This replaces the traditional way of automation. Because in the past, it was important to have knowledge of and experience regarding automation. However, with the creation of new technology, the automation of processes are simplified and, ironically, automated.

Processes in the future

To prevent your organisation from staying behind on recent developments, it is important to visualise which processes within your business should be automated. Depending on the ambitions and strategy of your organisation, of course. Important questions here are:

Which processes are work intensive?
Which processes contain many mistakes?
Which processes have a bigger lead time?

Many organisations have experienced in the past, that taking the step towards automation can be very costly. Fortunately, RPA is easy to approach, because your organisation will be able to keep the same system structure. And why is that, you ask? Because the same systems will be used, in fact, only will they be controlled by robots instead of human beings. Not only will the probability of mistakes be heavily decreased, but a robot can keep on working 24/7 as well.

Focus on value

If RPA offers many advantages, then why is there still some resistance regarding the implementation of this tools? Because employees feel as if they might lose their jobs because of it. RPA makes their work easier, as they take over their repeatable and simple actions. Examples could be archiving emails. In other words, employees will fulfill less administrative tasks, which leads to more time available for customers. And in specific: delivering value to the customers.

When an organisation becomes successful, it facilitates its employees to focus on basic tasks. However, making the transition to an organisation that focuses on customer value is not as facile as might be thought. Employees should aim at higher team performances, which is the responsibility of the management team.

Would you call your organisation future-proof?

If you are intrigued and want to be ready for the future as an organisation, we surely want to assist you. Please do not hesitate to contact us.

Het bericht Be ready for the future – use automation! verscheen eerst op Lean Six Sigma Group.

RPA might improve your organisation

Sebastiaan Kooijman — Thu, 04 Jun 2020 12:30:28 +0000

Working more efficiently using robots

Everyone has heard of Artificial Intelligence nowadays. But why is this still not applied within every organisation? After automating many processes, there has arisen a new opportunity. This is called RPA, or: Robotic Process Automation. This enables an organisation to create many more opportunities for the future.

The Lean methodology

The Lean methodology is often used to optimise processes, because these will be fun more efficiently. From here on, it is easier to implement RPA. When looking in the Lean toolkit, RPA can be seen as the most recent and technological addition to it. Currently, Lean makes use of tools and techniques in business processes that optimise time, resources, possessions and productivity. And eventually, this increases quality as well as customer value.

The growth of Lean

Robots are able to support Lean to increase this quality, eliminate possible defects, reduce lead time and increase customer satisfaction. Looking at the growth potential of Lean, the graph below shows the phase of growth (the red line). It is expected the growth in all three phases could increase with 20% by implementing the use of robots.

And how about working more efficiently? Often, when companies are thinking about using robots, focus is laid only on these robots and processes are forgotten. Less, is more they think. The surface of the organisation is improved. However, this would only include the tip of the iceberg that is the organisation. In other words, this automation is hard to develop, prone to failure and takes up much time.

Cross-functional teams must work together to create a transparent process. The best solution to a problem must be chosen, tested and the effect it has must be measured. This way, it becomes clear in what way exactly robots make these processes more efficiently and what the impact is they have on the customer and organisation. You should strive towards a better solution for the organisation instead of the other way around.

Lean tools, techniques and principles might be able to offer great support. The tools that are used will focus on the process design first. This should be finished before the automation phase has started. Waste should therefore be eliminated and current tasks should be optimised.

Advantages of RPA

After implementing these robots, you will be able to work more efficiently, because:

Automation increases the percentage of FTR (First Time Right) by eliminating possible human errors.
You can work using Just-In-Time. This means the process of possessing information on the right moment should be automated.
RPA takes the robot out of the human being. Employees can focus on activities that increase value and increase customer satisfaction. Studies have shown people actually prefer their jobs when they feel autonomous, capable and in possession of a goal.
Robots are able to work 24/7. This is an unique power.
Robots are faster than human beings.
The data that is generated by the use of robots provide managers with more insight in the bottleneck of the process and gives them ideas on how to improve the organisation.
Using RPA hands you the opportunity to choose the capacity of the robots, whenever.

In other words, RPA gives an organisation many advantages to work more efficiently and moreover use these capacities optimally because employees are assigned tasks they are good at.

Het bericht RPA might improve your organisation verscheen eerst op Lean Six Sigma Group.