Lean Blog

Weekend Fun Blog

2008-07-19T08:32:00.001-05:00

It's the weekend, here's a fun post and links for you. The "FAIL" blog is somewhat addictive, a collection of funny signs and bad product designs.

Muffin Fail « FAIL Blog

Here's a "chocolate chip" muffin where the design was taken quite literally. I assume the design spec from marketing didn't say "one chip."

Pastry Design Fail « FAIL Blog

Apparently, the above was a phone order that was taken a bit too literally, as well. Funny stuff...

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Tesco Understands Economics

2008-07-18T00:15:00.001-05:00

Sir Terry Leahy: The 'Robert Mugabe of retail' bites back - People, News - The Independent

First off, that's a pretty nasty nickname, being called the Robert Mugabe of anything. I don't know the whole history on that one, but Tesco is a British retailer, who could be described as the "Lean Wal-Mart." More about Tesco's Lean work can be found through a quick Google UK search -- they are featured quite often through the Lean Enterprise Institute and the Womack/Jones books (including Lean Solutions: How Companies and Customers Can Create Value and Wealth Together).

For all the talk about companies increasing prices because costs are going up (ignoring, at their own peril, basic supply-and-demand economics), Tesco has it right, I think. Their CEO and Chairman, Sir Terry Leahy, says:

"It's impossible for us to manipulate our prices because in this market if you price up unilaterally, it's commercial suicide. Therefore the industry would have to do it collectively, but it can't because that would be collusive behaviour.

How many of the companies that are raising prices, using costs as an excuse, are committing "commercial suicide?" Time will tell.

Another thing in the article that reminded me of Toyota was Tesco's frugal and spartan headquarters, as described by The Independent:

It's not exactly how you would expect to find the boss of the world's third biggest retailer. After 20 minutes' train journey into the indeterminate hinterland just outside London you walk a few hundred yards to a rather seedy industrial estate. It announces itself with a garage offering MOT testing and repairs. Barely a hundred yards beyond the car bashers looms a low-slung concrete block. This is the global headquarters of Tesco: annual sales £51.8bn, yes, billion.
The single receptionist sits beneath a sign reading: "Every Little Helps". Two minutes later Sir Terry Leahy is in the reception to take me upstairs to a fittingly unpretentious office.

Frugality - a core Lean principle, don't you think? "Every Little Helps" -- that's kaizen at work.

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Adventures in Food, England Edition

2008-07-17T15:21:00.003-05:00

No, it's not that I've had bad food. Far from it! I know this isn't a food blog, but I wanted to briefly discuss two blog-worthy experiences.

Conveyor Belt Sushi

First, I ate sushi off of a conveyor belt tonight. Well, not directly off the belt. But I ate at an outpost of the UK chain Yo! Sushi, where sushi and other dishes travel around a conveyor belt in covered dishes. You just reach forward and take what you want. The plates (and their prices) are color coded, a visual control of sorts. But it's often hard to see what's underneath the clear domes if it's a hot/warm dish, as steam fogs the clear bubble lid. At the end of the meal, they count up your plates and you pay. It was the tastiest conveyor belt I've ever been around.

One of the newspapers had a story about how some of the locations aren't as clean as they should be. I guess I was seduced by the automation! Hey, it's a trap that many factories and hospitals fall into, so why should I be immune, this one time? Should I have been concerned about cleanliness or food safety? Call me brave. I figured they would "clean up their act" after the news stories. I did wish there was a clearer visual indicator of how long the food had been on the conveyor belt.

"Pay What You Think The Meal is Worth"

I can't find a website for them, but I ate (a few weeks back) at a restaurant called "easyCurry" (it's probably a trademark infringement suit waiting to happen... calling easyJet, they are using the same font as you in their logo).

They have a unique concept. You pay £5 ($10 US) to get in, an "admission fee," they call it. Then you order one starter, one main, one veggie side, and rice or naan (and ice cream if you want it.... I have some willpower, I said no to that). You get charged normal prices for drinks, but then at the end you "pay what you think the meal is worth". Cash only.

I paid another £10 total at the end of the meal. I had one beer (£2.65). The £10 included my tip, but its unclear how they work that out with the staff (which is a big issue over here right now). The food was OK. I figured £15 wasn't outrageous for a full meal with a beer. I wonder if their average take is better than if they charged normal prices? How many people would feel shamed by walking out without paying more? This is a new restaurant... and maybe a risky strategy in a down economy. At least it isn't "all you can eat," for their sake.

Has anyone else heard of a restaurant (or any business) a pricing concept like this? I guess it's the clearest illustration of "value is defined by the customer" that I've seen in a long time.

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Checklists at a Hotel Front Desk

2008-07-17T00:05:00.003-05:00

There's so much in the news about "checklists" in the medical context... and I'm convinced that it's basically the Lean "standardized work" approach in a different name.

Checklists help prevent people from making mistakes of omission -- forgetting a step when following a routine or doing the same work day in and day out.Making mistakes like that doesn't mean you're "stupid" - it's a sign that we're human. That's why airline pilots use checklists and more surgeons and other health care providers are doing the same.

The other morning, I noticed a checklist being used at my hotel. It was a single sheet clearly labeled, "Morning Front Desk Activity Checklist." There were about a dozen items that needed to be done, with room for checking them off. I'll bet with the proper use (and oversight) of this checklist, there isn't a morning where someone forgets to post the accounts of those checking out.

Hopefully, checklists aren't viewed as insulting or demeaning. Checklists are common sense -- they work. They help ensure that people don't make mistakes or omissions... what's wrong with that?

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"More Careful" or "Better Processes"?

2008-07-16T00:01:00.003-05:00

NHS: 60,000 medication blunders in 18 months - Health News, Health & Wellbeing - The Independent

Trust me, I'm not picking on the NHS. There's a lot of good things happening here with Lean and I'll blog about some of that soon. This article from the Sunday Independent highlights some numbers on medical errors:

Medication blunders by NHS staff are killing patients at a rate of two a month and costing the health service £775m a year, a watchdog has revealed.

The National Patient Safety Agency (NPSA) has found that thousands of patients are being given the wrong drugs, too little or too much of their prescribed medication or miss doses altogether.

The study found 60,000 "medication incidents" were reported by hospitals, GPs, pharmacists and community health centres over 18 months up to June 2006. Thirty-eight patients died as a result of these mistakes and a further 54 were dangerously harmed. Experts believe that fewer than one in 10 cases are reported, suggesting that there may have been as many as 708 deaths out of one million incidents.

When you look at patient safety or medical error problems across the United States, Canada, and the U.K., they're roughly the same on a per-capita basis. It's not like any country is an order of magnitude better or worse than others. The operational processes tend to be the same across countries, leading to similar results, regardless of the payer system involved.

The response to these errors? We need more "Lean thinking" than what's demonstrated in the following quote:

These findings come a week after the NPSA Rapid Response Report which urged "extra care" when administering powerful drugs such as morphine, amid concerns incorrect dosing had caused several deaths since 2005.

As I've blogged about before (and write about in my book), "being careful" is not enough. Being careful is a good start, but bad processes and bad systems can defeat even the most careful of individuals. Urging staff members to be more careful, in my view, is unlikely to do much long-term good. Firing employees after the fact of an error doesn't do anything to improve the underlying processes.

If a process was error-prone, someone else is likely to make that same error again. If you could proactively identify which employees or physicians are likely to not be careful, those who going to cause an error, then just proactively fire those people. Problem solved right? Not really. We don't have that ability, so we'd better focus on processes and systems... not just "being careful."

The Lean approach urges us to create "error proofed" processes. Toyota and Lexus don't have better quality because their people are "more careful." It's all about systems and processes.

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Lean Overview Article in "The Hospitalist"

2008-07-15T13:15:00.002-05:00

The Lean Hospital

The Hospitalist is a publication for physicians who practice "hospital medicine." I had a chance to be interviewed for what turned out to be a nice overview of "how can Lean help hospitalists and their patients?" article.

Unfortunately, it only looks like the first page is free (the rest requires a membership or subscription).

From the intro:

What does being lean entail?
"At its core, lean is a process-improvement methodology and management improvement system," says Mark Graban... Graban teaches the Toyota system to hospitals throughout the country. One of the system's most basic tenets is respect for the work force. Another is that it does not assign blame. Instead, Graban explains, "Lean engages the work force to improve the work they are involved in -- improving process and quality, and reducing delays for patients."

I don't think I got misquoted at all during the article and I think I helped shape what was a very positive look at how Lean is helping hospitals improve.

And the article mentions my book, which is a nice plus. Thanks to everyone who has downloaded the first chapter and for the nice feedback. People from all over the world are downloading the chapter, which is exciting for the Lean Healthcare movement.

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Demand for Lean People Higher Than Six Sigma People?

2008-07-15T00:22:00.000-05:00

I know Tim Noble and he sent this to me, so I'm basically just going to reprint the press release verbatim and the solicit your comments:

Lean Talent Demand Finally Edges Out Six Sigma Fourth annual study by executive search firm

Avery Point Group finds Lean talent demand surpassing Six Sigma while companies increasingly leverage both methodologies in a down economy

ATLANTA, July 15, 2008 -- After years of steady gains, Lean has finally achieved a slight edge over Six Sigma as the more desired skill set. According to an annual study by The Avery Point Group, a leading national executive recruiting firm, this is a strong indicator that companies are increasingly looking to Lean as a means to help them combat the current economic headwinds they are facing.

"As an executive recruiting firm, we have a unique vantage point from which to observe the latest trends taking place in industry," says Tim Noble, managing principal of The Avery Point Group. "Trends in industry are often telegraphed into candidate requirements in job postings, and they can serve as a window into the latest corporate initiatives. Our annual study continues to offer useful insight into the latest trends taking place in the area of corporate continuous improvement."

Based on its fourth annual study of Internet job postings, The Avery Point Group found that Six Sigma may no longer hold its once dominant position in the world of corporate continuous improvement initiatives, as was found in its three previous annual studies. For the first time, the study showed that demand for Lean talent has grown to eclipse and slightly exceed that of Six Sigma. The growth in interest in Lean talent has not, however, come at the expense of Six Sigma; rather, this year’s study continues to confirm an overall increasing demand for continuous improvement talent, with Lean driving most of the recent talent demand growth.

The study also found, for those companies seeking Six Sigma or Lean talent, fully 50 percent are looking for practitioners to have both skill sets. Further, the study indicated that job postings are making increasing demands on candidates, requiring them to possess a much deeper knowledge and experience skill set with regard to their Lean backgrounds versus prior years.

"No longer is it acceptable for candidates to claim to have a Lean Sigma or Lean Six Sigma background," says Noble. "Companies want to see candidates that have the hardcore Lean experience gained in a true Lean transformation setting, and that can’t be gained from an environment where Lean is an afterthought or a lesser appendage to an existing Six Sigma program.”

Despite the rising prominence of Lean as the potentially new dominant continuous improvement methodology, Six Sigma is by no means past its prime, as evidenced by its continued talent demand resilience. It, however, means that companies, in the face of strong economic headwinds, are seriously rethinking the balance these two methodologies have with one another in their overall continuous improvement initiatives.

“This is certainly a major center of gravity shift from our first study in 2005 where Six Sigma talent demand outpaced Lean by more than 50 percent,” concludes Noble. “However, in the end, the real winner is any company that successfully engages in some form of continuous improvement, regardless of whether it is Lean, Six Sigma, or some other well-executed combination of both.”

For more information about The Avery Point Group and its executive search and recruiting services, contact Tim Noble at 678-585-9804.

Website: http://www.AveryPointGroup.com
Blog: http://leansixsigmajobs.blogspot.com/

What do you think? Does this match up with what you're seeing out there on the job market, in terms of relative demand for "true Lean" people as opposed to "Lean Six Sigma" people? Is the market for Six Sigma people falling?

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Monday Monday, Monday Morning...Less Than I Thought It Could Be?

2008-07-14T00:30:00.007-05:00

By Adam Zak, Adam Zak Executive Search:

With apologies to the Mammas and the Pappas… If I really hate Mondays, will it kill me?

Last Friday, on the 4th of July, Mark Graban blogged away about an article he’d seen in London regarding the myth of “Monday morning blues”. Mark noted that this article “reminded me of comments I've heard our good friend Norman Bodek make a few times recently.” According to Mark (I’ve heard this first-hand from Norman as well) “Norman tells a story about how he always asks audiences what day of the week they like best. People hardly ever say Monday, their favorite day of the week is usually Friday. Norman says that's sad, as people should be able to enjoy their work, that Monday shouldn't be such a dreaded day.”

But what if going to work on Monday morning, or hating the job you do to earn a living, could actually kill you?

A heart attack occurs when a blood vessel supplying blood to a part of the heart becomes blocked. Blood flow stops. Result: permanent damage to the heart muscle.

How does the block occur? My buddy Kevin, former head of ER at Good Shepherd Hospital up the road simplifies it for me this way. A tiny chunk of plaque breaks away inside my artery, forms a teeny wound within the artery wall; blood platelets and proteins show up and form a clot. This clot gets big quickly. It obstructs blood flow. I feel angina (chest pain). If I can’t shake the clot, I’ll have a heart attack. I might die. So, back to hating Mondays, my job, my life…

According to CNN, a study carried out by Japan's Tokyo Women's Medical University and published in the American Journal of Hypertension, showed that many workers suffer a significant increase in blood pressure as they return to the office after the weekend. High blood pressure is associated with a greater risk of suffering a heart attack or a stroke, and the results could help to explain why there are more heart attacks on Mondays than at any other time of the week.

Doc Kevin’s take on this: a change in blood pressure (up) causes those little chunks of plaque to break off. He tells me that my (and everyone’s) blood pressure always increases as our bodies begin to awaken in the morning. But there’s a limit to how much your BP can increase safely. As a former ER guy, Kevin has seen the Monday morning effect first-hand. Not sure I’d like to be in his Gemba for Monday AM rounds.

More from the Women’s Heart Foundation : “studies show the most common time for a heart attack to occur is Monday morning.” Also per CNN, research published several years ago in the British Medical Journal showed a 20 percent spike in heart attacks at the beginning of the week. So is there more to hating Monday’s, and conversely, looking forward to the weekend than might meet the eye?

Back to the Tokyo study: 175 men and women were fitted with devices to measure fluctuations in their blood pressure over the course of a week. The results showed a surge among those getting ready for work on Monday morning. Volunteers who were not going to work didn't experience a comparable increase, suggesting a link between increased blood pressure and work-related stress. "Most people are free of the mental and physical burdens of work on a Sunday and experience a more stressful change from weekend leisure activities to work activities on Mondays," said Dr. Shuogo Murakami, who led the research.

Another large study involving multiple centers in the United States found that you're least likely to suffer a heart attack on weekends and most likely on a Monday. And many studies have shown that they are most common between the hours of 6 a.m. and noon. Among the possible explanations for this latter finding is that levels of blood pressure and the stress hormone epinephrine tend to be higher in the morning, along with an increased tendency for blood clot formation. This according to Dr. Simeon Margolis, M.D., Ph.D. (Yahoo LifeStyle) a professor of both medicine and biological chemistry at Johns Hopkins School of Medicine.

High blood pressure could also be caused by the stress of commuting. Hey, I live in Chicago. I don’t need to hear about the stress of commuting. But British psychologist Dr. David Lewis recently showed that commuters suffered higher levels of stress during their journey to work than do than fighter pilots, with many recording increased heart rates at levels more usually associated with vigorous exercise. So was it really the commute? Or was it the anticipation of arriving at a dysfunctional workplace where ….

On January 29th of 2008, Michael Wilbon, Washington Post sports columnist and co-host of ESPN's "Pardon The Interruption", suffered a minor heart attack early Monday morning. According to reports, Wilbon complained of chest pains to his wife around 3 a.m. She took him to the hospital. Doctors found minor blockage in his heart and performed an angioplasty, which successfully removed the blockage. He survived.

Was Tim Russert bucking the trend with a Friday AM heart attack? Or was this some kind of final political statement? Russert, host of NBC's "Meet the Press" talk show, died on the job of a heart attack on Friday, June 13, 2008 at age 58. Does this disprove our “Monday Morning Heart Attack” theory? Maybe not. Russert had just returned late the night before from an Italian vacation with his family. We’ll have to assume the vacation itself was pretty relaxing. He arrived at his office after only a few hours of post-flight R&R. For Russert, this particular Friday morning turned out to be, effectively, his Monday. And certainly an unlucky Friday the 13th .

So, can Monday mornings kill us? Belinda Linden, Head of Medical Information at the British Heart Foundation, said a morning peak in blood pressure and the fact that more heart attacks occurred on Monday than on any other day of the week were both recognized by researchers. But she added that "larger and better controlled studies" were needed to establish the cause of the trends.

Or, I guess we could all just get jobs we really love and find fulfilling and satisfying, and which don’t give us heart attacks. Too much to ask? A pipe dream?

How about we determine that we will create truly Lean working environments where the principles of respect for each other lead to Lean Leadership across the board, at all levels within our companies? Let’s envision and build a workplace where we can take pride in our efforts, engage with each other and our customers, add measurable value by what we do, enable and empower each other, grow personally and professionally, and derive personal and professional satisfaction from our activities. Wouldn’t it be great if we all worked in a place from which we could leave each evening with joy in our hearts? One which would energize us to look forward to the next morning with the positive anticipation for the awesome accomplishments to come that day? Lots fewer heart attacks, I’d bet.

Adam Zak

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The Queen Sets the Takt Time?

2008-07-12T03:00:00.001-05:00

Clients of mine always end up saying something like "Lean really gets into your head... it's hard to turn off" - or at least one on every project ends up saying that. That's a good thing... a way of thinking, not just a set of tools.

Lean is in my head, and it's hard to turn off even on a holiday weekend in London. I saw a few instances that made me think of "flow" during our stops along the way.

The "London Eye" is an attraction that is basically a giant Ferris wheel, but with enclosed pods (as shown in a photo I took). It's quite an engineering marvel (to me, anyway) and a wonderful view of London in the 30 minute journey. The continuous flow aspect of the London Eye is that it never stops. It just rotates very slowly and they load/unload passengers through the door during a window that's like a moving assembly line with a 45-second cycle time. It's better than the herky-jerky load/unload process of a Ferris wheel at your county fair.

Now, it actually DOES stop (for safety reasons) when there is a disabled passenger who needs more time or would be unsteady on the slowly moving pod. Prioritizing safety over all -- good call. Even when the Eye *did* stop, it was very, very smooth. You can tell that was designed in, rather than being a safety afterthought.

We also visited the fascinating Tower of London (which is really a fortress and set of palaces, more than a single tower). One of the highlights is getting to see the Crown Jewels (or least what are purported to be the real thing... one of my colleagues here thinks they are a fake set to avoid theft). No photos, since they're not allowed during your tour.

One problem a museum or attraction might have is moving people along to keep the queue going. The Crown Jewels building is "Disney-like" in it's queuing... one line outside, then lots of queues in different rooms inside, with videos and things showing along the way. As our friend Peter Abilla writes about, this is good queuing practice to help you not focus on the waiting time.

People tend to want to stop and linger and stare at the jewels, they are pretty breathtaking. They used to have "a lady standing there who would poke you if you stood too long... keep it moving" according to a local colleague. Now, they have enforced flow with a moving walkway like you would find at an airport!

In the part of the building with the most valuable jewels, the pace of viewing is dictated by the Queen (in a way) via the pace of the moving walkway. No lingering... just continuous flow of visitors. Interesting. There are some treasures you can stand and stare at all you want.

I'm not sure if that's "customer focused" other than keeping the line moving and the queue down to a reasonable size.

I bet the walkway runs at a single speed at all times. It would be interesting to see if they could adjust the rate of the walkway to correspond with "takt time?" If there are slow times (and I'm not sure there are), the walkway could run slower and they could speed it up slightly when busy. I didn't see a "suggestion box" so I'll just have to pose that question here.

See how Lean can get stuck in your head? I don't think I'm the only Lean obsessive. To my own credit, I didn't think about Lean when I was on a beach for almost a week back in May.

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Toyota Invests In Workers Instead of Laying Them Off

2008-07-11T17:58:00.009-05:00

1) Guardian (U.K.) Story | 2) Houston Chronicle Story |
3) Chicago Tribune Story

I'll expand on this post tomorrow (off to bed, U.K. time) but how amazing is this illustration of the "respect for people" principle. You can treat people as expendable costs or an asset to train and invest in. Even as Toyota's truck sales have plummeted, are they resorting to layoffs? Nope!!

Even though full-sized Tundra pickup trucks won't be rolling off the production line of Toyota Motor Corp's factory here next month, the world's biggest automaker is keeping 2,000 plant workers on the payroll while it waits out a downturn in demand for its biggest gas-guzzling models.

While its Big Three U.S. rivals are shutting down truck plants and laying off workers, Toyota is hunkering down to keep its foothold in the heart of U.S. truck country.

Toyota will suspend Tundra production at its sprawling San Antonio factory in early August for three months due to slow sales, which are down nearly 50 percent for the first six months of 2008 versus a year earlier. Record U.S. gasoline prices over $4 a gallon have sent consumers scrambling for smaller, more efficient models.

But that doesn't mean the plant's workers won't be busy.

"Team members will continue to report to work and will continue to work as a two-shift operation, and they will continue to be paid 100 percent of wages," said Toyota spokesman Mike de la Garza.

But instead of building trucks, workers will spend their time in "training and development, to continue quality improvement activities, and to perform community service work," Toyota said.

The Tribune article points out that over 4,000 workers in Indiana won't be laid off while that plant is retooled from trucks to smaller SUVs.

From a Business Week article:

"This is not an inexpensive proposition to pay them for no production," Toyota spokesman Michael Goss said Thursday, but the company wants workers ready when production resumes. "We have a long-term optimistic view of the truck. It's going to take some time to get through this economic downturn." (The Guardian)

Many people would look at this story and think Toyota's being stupid, right? Not the "Lean thinkers" out there, though. Bravo to Toyota.

Note: Toyota *did* layoff 200 temporary workers. But that's different, right?

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Toyota Raises Prices - Yep, That Same Excuse

2008-07-11T13:53:00.002-05:00

Toyota Bumps Prices For 11 Models | The Truth About Cars

Ok, since I was accused (rightfully so) of picking on just GM for this, Toyota has also used the "rising materials cost" excuse for raising prices on some models.

A Toyota spokesman said:

"Price changes were made to keep up with current economic conditions and the rising cost of major components... Materials in global markets have gone up. We have made an effort to absorb some to the cost while still protecting our price position."

Don't get me wrong -- companies are allowed to raise prices. It's their choice based on their view of the market. I'll quit beating this drum, but it fascinates me that it's socially acceptable to give the "our costs went up" reason.

We don't hear as often of price reductions because raw material costs go down (well, maybe except in the electronics industry where technology is moving fast...) Has this ever been offered as a reason to cut prices in the auto industry? Let's keep the discussion there.

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"Successful" "Lean" Company "Forced" to Raise Prices

2008-07-11T00:24:00.000-05:00

Wenger Corp. Announces Price Increases - MarketWatch

Harkening back to my earlier post about GM schizophrenically cutting AND raising prices (due to poor sales and rising materials costs), we find another article about a company raising prices "because they have to."

Facing unprecedented cost increases in raw materials, Wenger Corporation is notifying customers that prices on all its products will increase by four percent effective July 14.

"Our continuous improvement efforts, including lean manufacturing activities, have been highly successful in producing measurable results," says Bill Beer, President and CEO of Wenger Corporation. "However, we can no longer absorb commodity price increases of this magnitude." Since January, Wenger has experienced double-digit price increases for key materials including steel, aluminum, plastic and wood, along with higher freight and fuel costs.

Ugh. This is pretty simple. When costs go up, profits go down (not trying to be condescending). Most companies don't like that... sure they've tried reducing other costs (through Lean, bravo), but profit margins are "unacceptable" to management. So what do you do? Raise prices, to maintain margins, of course. That's a very linear and simplistic view of the world.

In most markets, if you raise prices, demand will go down. Falling sales will increase the company's cost per unit, which will make profit look worse. So what do you do? Raise prices? How do you get out of that cycle?

To any company that is raising prices "because they have to" and it isn't appreciably hurting sales, I have one question? Why didn't you raise prices earlier? You obviously weren't charging a fair market prices. OK, second question... isn't that a sign of mismanagement, not charging a properly high price?

You should raise prices "because you can." Because customers will pay it. Well, except that customers might only be "forced" to pay the higher price until they can get out of their contract or change their design so they can switch to a competitor.

Or am I missing something? If I'm not understanding this right, I guess my MBA ain't worth much. But I'd bet Wenger Corp. is run by MBAs also...

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Mark on the "Better Process" Podcast

2008-07-10T13:00:00.000-05:00

PodcasterNews - Better Process Podcast - Industry Report Mark Graban LeanHospitalsBook.com

OK, this is turning into a highly promotional week for my book, hope that's OK with everyone.

Here is another podcast interview, this time conducted by Ken Rayment. I've been interviewed by Ken before, and I also did a guest commentary about Lean healthcare last year. There are links to both of those here, on my book's webpage.

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Checklists and How You Manage Them

2008-07-10T00:05:00.004-05:00

Thinking back to a letter-to-the-editor that I mentioned last week, this is such a critical point, I wanted to think and write about it again, especially since it was in the comments and not everyone sees that.

It’s not the checklist itself that’s important – what matters is how it is managed.

A checklist, or any form of standardized work, is useless if it is not followed consistently or, in some cases, 100% of the time. Errors might be rare in certain fields, but we don’t want to be on that one plane where the pilot fails to go through the pre-flight checklist (because they are feeling rushed or out of arrogance), leading to catastrophic results (such as the Northwest Airlines Flight 255 crash that happened during my childhood in Detroit because the pilots didn't follow a checklist).

As hospitals are adopting checklists (or "standardized work" in the terminology of Lean), I’m sure much effort will be put into the writing of the checklists. Ideally, the checklists will be written by the people who actually do the work, rather than being copied from another site or being handed down from a manager or a single expert. Hopefully, people working in the process will be taught to understand the value of a checklist, rather than just being told to do it.

So if we have a checklist in place, how do we make sure it is followed 100% of the time? Again, creating “buy in” by involving people and selling the idea of the checklist is important. That is leadership’s job. It is important for managers to “audit” the use of checklists, but we cannot watch people 100% of the time. Hence, the need to create that buy-in so people will do the right thing, in all circumstances, when not being watched.Leadership must make it clear that ANY team member can call a true “time out” if a surgical procedure, for example, is about to go forward without the checklist being used. Leadership must support and stand by staff members, particularly junior ones, who take what might be a courageous stand against, let’s say, a powerful surgeon who doesn’t want to do the checklist.

vWhile we don’t want to “hound” people constantly, it is important that leaders check frequently to make sure the checklists are being used. We want to avoid a situation like one where a hospital leader, before Lean, explained (somewhat tongue in cheek) that “this process is so critical that nobody ever checks to make sure it’s happening.”

As President Ronald Reagan famously said, “trust, but verify.” Leaders, or other designated observers, must check in to see that checklists are being followed (at the time they are supposed to be used), or we must verify the paperwork quickly after the fact to see if the checklists have been followed. Some direct observation is important to make sure that the checklists aren’t just a “tick the box” exercise that is done without thinking. We have to make sure the “spirit of the law” is followed, not just the “letter of the law.”

Here is a recent story from the BBC about a hospital that has new rules requiring that physicians not wear long sleeves and that, if they wear ties, they be tucked back. These rules are in place to make it easier for physicians to wash their hands and to help them avoid touching a dirty tie during the day. Again, hopefully these rules were developed with the participation of the physicians and that they were sold on the idea, rather than having it dictated. At least one physician is helping lead the effort, apparently:

Consultant physician Dr Chris Uridge told BBC News: "We roll our sleeves up, take off any rings, bracelets and wrist watches."If you've got cuffs and watches it inhibits good, effective cleansing - it's as simple as that."

Good stuff – they are measuring the results (although there are other changes happening in parallel – how do you prove it was this change that reduced infection rates? It seems like it would help, though. It also sounds like they are explaining why, a good Lean practice that is in keeping with the “respect for people” principle.

Now my question for this scenario would be, “who is monitoring or verifying that these practices are being followed?” The reaction of administrative and clinical leaders when they see someone wearing long sleeves that first time will be critical. If they look the other way, then they effectively have no standardized work.Leaders must be strong enough to question people when they are not following standardized work. This doesn’t mean they should yell at someone. Especially early on when a new method, it’s good to gently reinforce the importance of the new standard, making sure people are aware and they understand why it’s important. If you don’t hold people accountable, the standardized work becomes discretionary and you’ll lose the potential benefits that would come from everyone following the process.

Asking, rather than yelling, is key because there may be certain circumstances when it was best for the patient to NOT follow the standardized work. For example, a truly urgent situation in the emergency department might require swift action, where the risk of stopping to do a time out (time delay) is worse than the risk of a mixup that could occur from not following standardized work.

Even with standardized work, people need to be able to exercise professional judgment. But we have to be careful that someone isn’t choosing to not follow standardized work “because I didn’t feel like it.” There’s a difference between having a legitimate reason or not, as explained in the case of Geisinger Health System and their cardiac surgeons’ checklists.So as hospitals implement checklists and time out processes, the same question applies. Who is going to verify and hold people accountable?

Can leaders truly lead and sell people on ideas instead of being dictatorial and mandating?

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Discount Code for Book (15% off)

2008-07-09T15:58:00.003-05:00

For those who already saw the post and wouldn't otherwise scroll down, please re-visit my earlier post that now has a discount code for 15% off my book, valid through August 31.

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Wall St. Analyst Likes Convis and Dana

2008-07-09T15:21:00.003-05:00

Headlines from the auto industry | Freep.com | Detroit Free Press

I've always been a huge fan of Gary Convis and his leadership style, which you know if you're a frequent reader of the blog. I've been curious to see how he would do as CEO of Dana. Yes, Convis is a great leader, but Dana is a bankrupt mess. What can he do?

One Wall St. analyst is positive about their outlook, hopefully for the right reasons:

Dana's management team is experienced and "we envision urgency towards potential asset sales and operational turnaround," Patel, based in New York, wrote in a note to investors Tuesday. Dana came out of bankruptcy court proceedings on Feb. 1.
Dana named former Toyota Motor Corp. manufacturing manager Gary Convis as chief executive officer on April 17. He took over from John Devine, formerly chief financial officer for both General Motors Corp. and Ford Motor Co., who will remain as chairman.

So, which will it be -- asset sales (break up the company) or operational turnaround (fix the company, for the long-term)??

I wish someone would do a Lean-focused interview with him about his new challenge (hint hint, if anyone has a connection, I'd love to interview him).

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Free Download - Chapter 1 of "Lean Hospitals"

2008-07-08T17:00:00.013-05:00

Hi, my publisher (Productivity Press) has agreed to make Chapter 1 available for free online! If you already signed up for my book's email newsletter, you'll receive an email with information about how to download.

Otherwise, please visit my book's website here for a free registration form. I'll send the PDF out via email within 24 hours.

To purchase the full book, please visit the publisher's site or amazon.com.

UPDATE (7/9/08):

The book is due to be out July 21, 2008. Visit www.leanhospitalsbook.com for more info and ordering information. Lean Blog readers can use a discount code. The code is 906GW and it’s good for a 15% off discount thru the Productivity Press website until August 31. Direct link to purchase my book is here. You will have to input the code upon check out in their shopping chart to receive the discount. When the book is available, you will receive their copy immediately; regular ground shipping is free.

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Is GM Smoking Something?

2008-07-08T14:18:00.003-05:00

Industry News: GM To Offer Zero-Percent Financing, Raise Prices, Screen Hummer Buyers

It's very hard to figure out what GM is thinking these days. In the first link above, the Jalopnik blog highlights an inconsistency I also noticed... it's the old laws of supply and demand popping up again. It always amuses me, in a way, that this basic law of microeconomics is even considered a "Lean lesson" because Toyota leaders like Ohno wrote about it. The basic supply and demand laws dictate the prices for just about everything -- unless you are a monopoly provider or a (obscure econ word warning...) "monopsony" buyer (meaning you are the only buyer, or one of a few buyers for an item). There's no board game called Monopsony that I'm aware of.

GM likes to flout the laws of supply and demand, as evidenced in the Japopnik post. GM says they are raising 2009 prices for the typical excuse of "rising material costs" -- the last excuse of a scoundrel. Just because your raw materials and inputs cost more, that might mean NOTHING to your buyers and their valuation of your final product. Just because flour prices have gone up (and they have), that doesn't mean people are willing to pay more for bread and pizza. It's simple supply and demand economics.

So while GM announces they plan to raise prices in 2009 (a "price rise," as they call it here in England -- ah, the small differences), they were also offering ZERO PERCENT financing to buyers recently (basically a price cut). If you're having to cut prices to spur demand, why announce you're raising prices? Because you can? Good luck with that. I'm sure we'll be treated to yet another annual story about how GM no longer plans to rely on incentives and cheap financing to move metal. Let's see what they have to do to artificially prop up the June 2009 numbers (see "robbing Peter to pay Paul.") Pulling ahead sales from future months is such a laughably short-term strategy (and old habit) .... but again, typical GM.

So while GM is bitching about price increases, they're also (guess what) still attempting to squeeze those damn steel suppliers who are (guess what) trying to increase steel prices because of... wait for it... their rising material costs!!! Yes, we are living in bizarro land. The steel suppliers are now exerting THEIR market power for a change. And I bet GM doesn't like how that feels. From a WSJ article on this:

As emerging countries increase their need for steel to build infrastructure, commercial buildings and automobiles in their respective countries, the demand for steel has outstripped supply. That has caused prices to shoot up, most drastically in the past year.

That has left U.S. auto makers, which had long dominated steelmakers during negotiations, in a weak bargaining position. For decades, U.S. auto makers were the steelmakers' most lucrative customers and bullied them into selling them long-term contract steel at discount rates.

When you bully suppliers, they want to come back to bully you when they get the chance. Shouldn't be surprising... you reap what you sow?

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Mark on the "Competing Podcast"

2008-07-07T16:00:00.003-05:00

Lean Thinking Network | Competing Podcast » Archive » Competing Mark Graban

Thanks to Dwight Bowen for having me as a guest on his excellent podcast series. I chatted with Dwight about my book and the applications of Lean methods in healthcare and hospitals. Hope you enjoy the podcast.

Update on the book -- still targeted for late July, the book actually went to print a bit early. On time delivery!! (Knock on wood). I hope you also think the quality of the book is to high standards as well!

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Malaysia Airlines Wants to Be a Lean Airline?

2008-07-07T14:58:00.000-05:00

The Idris Jala way

A colleague of mine in the UK came back from a holiday in Borneo, talking about seeing the CEO of Malaysia Airlines on TV, talking about Toyota. How random is that? I can't find the video or story on line, but a bit of Googling indicates this might really be the case.

One article reprinted on a message board says:

Mr Idris says he is now modelling MAS on companies like Toyota, which have successfully maintained quality while reducing costs.

Said Mr Idris: "We will not behave like a low-cost carrier. We will always provide superior products and services to customers but we will drive down our cost so that we will be able to offer highly-competitive rates to passengers."

In this article ("The Idris Jala Way"), Idris and the airline have some pretty Toyota-like things attributed to them:

For one, it returned to the culture of thrift that had characterised the early years of success against the odds. Take flight turnaround times, for instance.
“If we cut that by five minutes, MAS can free one whole 737 for flights,” explains Idris.

They're also creative in ways of cutting costs... well, and they also used layoffs, unfortunately.

When passengers are a “no show” half an hour before take-off, some aircraft fuel is sucked out to save weight (a lighter plane is cheaper to fly). Full meal trays were replaced with meal boxes, as they were easier to handle, thus saving on time and staff. And there was a (voluntary) Mutual Separation Scheme, which trimmed some 2,600 workers.

If this truly was a survival situation for the airline (as it was for Toyota in the late 1940s), a fair and voluntary layoff plan may have been their only hope... as long as it was a one-time cut.

Are they "Toyota like?" I'd say "no" given the whole context of the article, even with the examples cited. But, if they are truly working on it (and can avoid relying on layoffs), they might be worth looking out for.

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