Thinking LEAN - Finance and Resource Management ...oe. Mini Conf_10-19-2015_web version...Objectives and Expectations • Start “thinking Lean” • Better understand Lean methodology • Utilize Lean concepts to identify and remove ... 3 What is Lean? Creating more value for customer with fewer resources Lean is a philosophy

Download Thinking LEAN - Finance and Resource Management ...oe.  Mini Conf_10-19-2015_web version...Objectives and Expectations • Start “thinking Lean” • Better understand Lean methodology • Utilize Lean concepts to identify and remove ... 3 What is Lean? Creating more value for customer with fewer resources Lean is a philosophy

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<ul><li><p> Thinking LEAN </p><p>1 </p></li><li><p>Objectives and Expectations Start thinking Lean Better understand Lean methodology Utilize Lean concepts to identify and remove </p><p>waste and enhance customer value Understand your role in creating a Lean culture </p><p>2 </p><p>PresenterPresentation Notes</p></li><li><p>3 </p><p>What is Lean? </p><p>Creating more value for customer with fewer resources </p><p>PresenterPresentation NotesLean is a philosophy for how we do our work everyday. Ask yourself/your teamHow are we including the voice of the customer in the design, delivery and improvement of our services?Are we using data to inform our decisions and validate assumptions?Are we engaging and empowering employees to improve the efficiency and effectiveness of our services?Are we setting SMART goals and measuring our performance?Are we holding ourselves and others responsible for following through on commitments?Are we continuously improving? Are we experimenting and learning from our success and failures?</p></li><li><p>History of Lean </p><p> Continuous improvement methodology originated in 1920s </p><p> Refined by Toyota Motor Corporation in early 1960s </p><p> Today, Lean is successfully adopted across all types of organizations and business sectors including higher education. </p><p>4 </p><p>PresenterPresentation NotesCal Poly San Luis ObispoCalifornia State UniversityUniversity of WashingtonUniversity of Notre DameTexas A&amp;M UniversityThe George Washington UniversityThe Ohio State UniversityUniversity of AlabamaUniversity of Central OklahomaMarquette UniversityMichigan State UniversityMissouri Southern StateDuquesne UniversitySaint Louis UniversityAerospaceConsumer ProductsConsultingFinancial &amp; InsuranceIndustrial EquipmentElectronicsProcess IndustriesMedical &amp; PharmaceuticalFood &amp; Food ServiceHealthcareKaiser HospitalUniversity of California, Davis Health System</p><p>Other examples:State of Minnesota, Department of Administration, Office of Continuous Improvement</p></li><li><p>3 Pillars of Lean </p><p>Increase Value </p><p>Reduce Waste </p><p>Respect People </p><p>5 </p><p>PresenterPresentation NotesRespect for PeopleIt starts with self-awareness and personal accountability for our own leadership. Ask yourself, Am Icontinuing to grow, learn, and develop?* building capability with those around me?* coaching and acknowledging others?* using language constructively, listening and communicating effectively?* contributing to the development of a Lean culture?* actively improving processes and solving problems?* being accountable to the results, as well as, the process to achieve them?</p></li><li><p>A Lean culture </p><p> Begins with a committed leadership Encourages team-based problem solving Emphasizes communication and teamwork Leverages staff talent Challenges the status quo </p><p>6 </p></li><li><p>A Lean culture </p><p> Standardizes processes Eliminates tasks that do not add value Makes processes as easy as possible for </p><p>customers and staff Focuses on continuous improvement Automates repetitive tasks Requires metrics and goals </p><p>7 </p><p>PresenterPresentation Notes</p><p>Benefits of Lean:Reduced product and service cost because you minimize product wasteEnhanced customer satisfaction and reduced customer complaints because customer needs and preferences drive service design and improvementsIncreased staff engagement and morale because staff are involved in making the process better.Increased service quality a)problems are solved at their source b)listen to customers c)use data and best practices in service design d)use creativity to identify no/low cost solutionsIncreased accountability because people are following the Lean methodology</p></li><li><p>The Perfect Process </p><p> Is completed entirely by one person Is completed one at a time (no batching) Is completed as soon as the request is made Is completed without interruption (flow) Is completed with the information provided Is completed correctly (no defects) Never returns </p><p>8 </p><p>PresenterPresentation NotesIdeal process = no wasteCompleted by one person = eliminate/limit the number of hand-offsCompleted one at a time = batching slows over all processing cycle time and creates inventoryCompleted as soon as request is made = no waitingCompleted without interruption = in a perfect world, work would be completed without interruptionsCompleted information provided = accurate and complete data leads to less interruptions, less waiting, less defectsCompleted correctly = goal should always be accurate and correct work moving forwardIt never returns = no errors = no rework</p></li><li><p>Three Types of Process Activities </p><p>9 </p></li><li><p>Value Add Activities In Lean, value is defined from the end user/customer perspective. </p><p>Value add activities: Address the form, </p><p>features or functions that the customer desires Are done right the first </p><p>time (no rework) Directly contribute to </p><p>customer expectations 10 </p><p>PresenterPresentation NotesSpecify value by product from the standpoint of the customer. Applies to services as well as goodsMost customers just want a solution to their problem.</p><p>To be effective, we must:Understand what features, benefits, services are most important to our customer (departments/units that we serve)Identify the process activities that deliver those desired outcomesStreamline or eliminate all other non-value-adding activities</p><p>Define value from the customers perspective</p></li><li><p>Value to the Customer </p><p> Quality meets or exceeds expectations </p><p> Delivery reliable and consistent </p><p> Cost right price or resource investment </p><p> 11 </p></li><li><p>Non-Value Add Activities Consume resources but create no value for the </p><p>customer Could be stopped and it would be invisible to the </p><p>end-user or customer </p><p>Goal: To ELIMINATE non-value-added activities </p><p>because they are WASTE 12 </p><p>PresenterPresentation NotesNon-value added processes:Steps not part of the original scopeDuplicate efforts (costs money wastes time)Unnecessary approvals/sign-offsSteps that leave finished products idle (waiting)Additional processes that arent needed or wanted by customer</p></li><li><p>Example </p><p>Depositing a check into a bank account </p><p>13 </p></li><li><p>Value Add vs. Non-Value Add </p><p>Non-Value Add 25 Minutes 96% of total time </p><p>Value Add 1 Minute 4% of total time </p><p>14 </p><p>PresenterPresentation NotesExamplesValue-added activities:Entering ordersTranslating materialsCreating codesPreparing drawings/artworkAssembling goodsShipping to customers</p><p>Non-value-add:CheckingSignaturesAsking approvingReviewing FilingReportingMonitoringReworkTransportationSearching - gathering</p></li><li><p>Value Add 1 Minute 33% of total time </p><p>Non-Value Add 2 Minutes 66% of total time </p><p>Value-Add vs. Non-value-add </p><p>15 </p></li><li><p>Essential Non-Value Add Activities </p><p> Activities that dont contribute to customer satisfaction that must be done to comply with regulations, organizational policies, etc. </p><p>Periodically examine these activities to make sure they are necessary. If not, eliminate them. </p><p>16 </p></li><li><p>ACTIVITY </p><p>17 </p></li><li><p>Directions </p><p> The worksheet has a list of value add, non-value add and essential non-value add administrative activities </p><p> In the next five (5) minutes, individually identify the category in which each activity belongs </p><p> When youve completed your individual worksheet, turn it over on the table </p><p>18 </p></li><li><p>Directions </p><p> At each table, identify a facilitator and a scribe In the next ten (10) minutes, discuss the </p><p>individual responses to the worksheet and then, as a group, come to consensus about the correct response for each activity </p><p>19 </p></li><li><p>Value Add Review </p><p>Activity </p><p>1. Maintenance of office equipment 2. Two-year supply of a form in the </p><p>filing cabinet 3. Taking customer orders 4. Re-typing the information </p><p>Type </p><p>1. ENVA 2. NVA 3. VA 4. NVA </p><p>20 </p></li><li><p>Value Add Review </p><p>Activity </p><p>5. Hunting for the correct paper for the copy machine </p><p>6. Printing a time sheet, then scanning and mailing </p><p>7. Printing the required number of certificates for class participants </p><p>8. Maintaining HR records </p><p>Type </p><p>5. ENVA </p><p>6. NVA </p><p>7. VA </p><p>8. ENVA </p><p>21 </p></li><li><p>Value Add Review </p><p>Activity </p><p>9. Filing a copy of the completed form in two offices </p><p>10. Filling out reports that no one looks at </p><p>11. Ordering business supplies 12. Calling to get missing information </p><p>Type </p><p>9. NVA </p><p>10. NVA </p><p>11. ENVA </p><p>12. NVA </p><p>22 </p></li><li><p>Value Add Review </p><p>Activity </p><p>13. Collecting customer feedback 14. Printing paperwork too soon </p><p> 15. Face time with clients/customers </p><p> 16. Double checking a colleagues work </p><p>Type </p><p>13. VA </p><p>14. NVA </p><p>15. VA </p><p>16. NVA </p><p>23 </p></li><li><p>Value Add Review </p><p>Activity </p><p>17. Electronically collecting meal orders for an event </p><p>18. Preparing compliance reports </p><p>19. Safety inspection of work environment </p><p>20. Backing up computer files for data storage </p><p>Type </p><p>17. VA </p><p>18. ENVA </p><p>19. ENVA </p><p>20. NVA </p><p>24 </p></li><li><p>What is Waste? </p><p>The elements of an activity that do not add value from the customer </p><p>perspective </p><p>25 </p><p>PresenterPresentation Notes</p><p>Acronym DOWNTIME may help you remember the 8 wastes</p><p>Customers define value in a processWaste is typically 90% of a processLean training gives us a lens to see wasteLean also gives us a common vocabulary to describe waste</p></li><li><p>26 </p></li><li><p>27 </p></li><li><p>Waste: Defects </p><p>Examples: Data entry errors Missing or incomplete </p><p>information Solutions: Automate forms Create standard work flow Ensure processes are clear </p><p>Errors - Not doing things right the first time </p><p>28 </p><p>PresenterPresentation NotesDefects cost money, waste time, waste resources and create:Re-workCustomer frustrationEmployee frustrationCauses:Unclear roles &amp; responsibilitiesUnclear or complex processRequired information not present</p><p>Examples:Providing the wrong product or serviceMissing or incorrect information in an application or formIncomplete forms</p><p>Overproduction:Source of overproduction is typically unclear standards and specifications hence the reason that clarity on customer requirements up front and standard work processes areimportant strategies for mitigating this form of waste.Characteristics of overproduction:BottlenecksUnbalanced work flowInventoryExamples:Making more copies than neededCreating reports or documents that no one readsMultiple meetings about the same issue without making a decisionCauses:Uneven/poor work flow or distributionUnclear customer requirements</p></li><li><p>Waste: Overproduction </p><p>Examples: More attending a meeting than necessary Creating reports that no one reads Solutions: Balance work load Align processes with customer needs </p><p>Producing more than the customer needs </p><p>29 </p><p>PresenterPresentation NotesDefects cost money, waste time, waste resources and create:Re-workCustomer frustrationEmployee frustrationCauses:Unclear roles &amp; responsibilitiesUnclear or complex processRequired information not present</p><p>Examples:Providing the wrong product or serviceMissing or incorrect information in an application or formIncomplete forms</p><p>Overproduction:Source of overproduction is typically unclear standards and specifications hence the reason that clarity on customer requirements up front and standard work processes areimportant strategies for mitigating this form of waste.Characteristics of overproduction:BottlenecksUnbalanced work flowInventoryExamples:Making more copies than neededCreating reports or documents that no one readsMultiple meetings about the same issue without making a decisionCauses:Uneven/poor work flow or distributionUnclear customer requirements</p></li><li><p>Examples: Approval queues or decisions Waiting for customer information Solutions: Eliminate/reduce hand-offs Leverage technology Clarify processes </p><p>Waste: Waiting Time lost when people and/or information </p><p>are not ready </p><p>30 </p><p>PresenterPresentation NotesWAITINGFact: Roughly 90% of the time that is required to produce and product or service is because of waiting. Hand-offs increase wait times, decisions increase wait times, are they all really necessary?</p><p>Goal: smooth and continuous flow between each process stepCauses:Missing or incorrect informationUnclear processSignature requirementsNot leveraging technology</p><p>Non Utilized staffDont let employees skills go to waste.Remove process barriers so that staff can do the work they were hired for and want to do.Causes:Not delegating workInappropriate job descriptions or dutiesNot empowering staff to think Lean</p></li><li><p>Waste: Non-Utilized Staff </p><p>Examples: Not involving staff in problem </p><p>solving Staff hired to do x but doing y Solutions: Empower staff to solve problems </p><p>and think Lean Engage staff in continuous </p><p>improvement projects Delegate work tasks appropriately </p><p>Not leveraging peoples skills, creativity and talents </p><p>31 </p><p>PresenterPresentation NotesWAITINGFact: Roughly 90% of the time that is required to produce and product or service is because of waiting. Hand-offs increase wait times, decisions increase wait times, are they all really necessary?</p><p>Goal: smooth and continuous flow between each process stepCauses:Missing or incorrect informationUnclear processSignature requirementsNot leveraging technology</p><p>Non Utilized staffDont let employees skills go to waste.Remove process barriers so that staff can do the work they were hired for and want to do.Causes:Not delegating workInappropriate job descriptions or dutiesNot empowering staff to think Lean</p></li><li><p>Waste: Transportation </p><p>Examples: Routing documents Hand-offs Solutions: Leverage technology Analyze data to </p><p>determine root cause </p><p>Moving objects from one place to another </p><p>32 </p><p>PresenterPresentation NotesTransportationCauses:Staff turnover/relocationPoor planning &amp; communication</p><p>Inventory/StorageCauses:Batch processingNot leveraging technology</p></li><li><p>Waste: Inventory/Storage </p><p>Examples: Duplicate copies Obsolete databases/files Solutions: First in, first out </p><p>processing Reallocate work during </p><p>busy times </p><p>Unnecessary storage of information or material </p><p>33 </p><p>PresenterPresentation NotesTransportationCauses:Staff turnover/relocationPoor planning &amp; communication</p><p>Inventory/StorageCauses:Batch processingNot leveraging technology</p></li><li><p>Waste: Motion </p><p>Examples: Needing multiple clicks to </p><p>retrieve files Searching for files in a messy </p><p>cabinet Solutions: Organize files and supplies </p><p>for easy access Enhance collaboration &amp; </p><p>communication </p><p>Unnecessary movement of people </p><p>34 </p></li><li><p>Waste: Extra Processing </p><p>Examples: Excess signature approvals Same data required in </p><p>multiple places on a form Solutions: Delete/automate signature </p><p>requirements Eliminate excess approvals Automate forms </p><p>Process steps that do not add value for the customer </p><p>35 </p></li><li><p>ACTIVITY </p><p>36 </p></li><li><p>Directions </p><p> Choose a partner Each partner will have a set of flash cards One partner will read the activity listed on the </p><p>card; the other will identify the type of waste the activity reflects </p><p> When you hear the bell, switch roles </p><p>37 </p></li><li><p>Lean Thinking Philosophy </p><p>38 </p><p>PresenterPresentation NotesMove from a current state full of waste and variation to a future state where waste has been identified and removed from the process</p><p>Repeat the process to continuously improve</p></li><li><p>So far </p><p> Value add; non-value add; essential non-value add </p><p> Leans 8 Wastes Current state process mapping Removing waste from a process Future state process mapping </p><p>39 </p></li><li><p>Searching for files in a file room is what type of waste? </p><p> 1. Defect 2. Motion 3. Overproduction 4. Transportation </p><p>40 </p></li><li><p>Motion </p><p>Unnecessary movement of </p><p>people </p><p>41 </p></li><li><p>What type of waste is producing reports t...</p></li></ul>