CHAPTER 2 The Role Of Daily Work In Operational Excellence
When I took over the CI role, the company's president tasked me with ingraining it within our culture, moving beyond mere stand-alone Kaizen events. I entered a work environment where continuous improvement was viewed as an extra burden, something perceived as stealing time from their work or posing a threat to job security. Step one became integrating continuous improvement into their daily tasks through the following initiatives:
Four hours of CI training annually
Enhancing their skill set or improving at least one work process each year
Collaborating on one team project Continuous improvement needs to evolve into a guiding principle: aiming to enhance your daily tasks every day. It's vital for employees to approach their work with a fresh perspective, constantly seeking opportunities for minor enhancements every day. Every transaction, customer interaction, and business process serves as a foundation for improvement. Starting small, such as encouraging employees to tidy up desks, network folders, and emails, can have a cumulative impact throughout the organization, resulting in heightened engagement and energy levels. Waiting to address processes only when they break is a common error. Similar to machines on a manufacturing floor, process design, and infrastructure demand regular maintenance and feedback loops for sustained effectiveness. Open conversations with employees about their tasks, encouraging them to share frustrations with existing processes. Identifying areas for improvement while the process is still functional is key to promoting a proactive approach to enhancement. For continuous improvement (CI) professionals, addressing these concerns with employees' managers is crucial, as many individuals may hesitate to raise such issues themselves. If you are a manager, ensure you use encouraging language that emphasizes solutions, steering clear of any words that could be interpreted as assigning blame. Transforming the culture also means instilling a practice where management consistently poses questions and encourages employees to seek improvements on their own proactively. "Let's do a CI to fix this" emerged as a straightforward technique to kick-start any improvement project. Large improvement projects can quickly become overwhelming and should be divided by the amount of effort needed to be completed in a month. These could be handled as multiday improvement events with a facilitator or as a project with a series of team meetings. Teams need to be working on at least one improvement project at all times.
Quality Cost = Prevention Cost + Appraisal Cost + Failure Cost1 The formula above underscores the role of daily work in driving improvement and innovation. Prevention encompasses activities aimed at embedding quality into the product creation or service execution process. Appraisal covers all costs related to inspection or testing. The introduction of complexity introduces numerous hidden costs, including extra steps, workarounds, and additional personnel or processes. Over time, these hidden costs manifest as a slowdown in tasks and increased issues stemming from unforeseen scenarios. Repeated failures not only jeopardize an organization's reputation but also have a cascading effect on sales, employee retention, stock performance, and other critical aspects. Let's not overlook the often-underestimated expense of maintenance, which tends to be one of the costliest aspects with limited visibility. Maintenance costs encompass all the expenditures necessary to maintain physical or digital assets in optimal working condition. Upon closer consideration, nearly every acquisition involves some form of maintenance cost, covering labor, spare parts, and even energy consumption. Moreover, costs extend beyond financial considerations. Upgrades or updates may entail a learning curve, consuming time in planning for maintenance, or the downtime resulting from either conducting the maintenance or the repercussions of neglecting it and facing an inevitable breakdown. It's imperative to recognize and factor in these multifaceted costs to ensure a comprehensive understanding of the true investment associated with any asset or system. Six Sigma methodology has levels that determine the probability that an error or defect will occur. A company operating at about 3.5 sigma spends about twenty percent of its costs on maintenance and rectifying defects. This is because they are at about 97.7 percent efficiency, creating nearly 22,700 mistakes per million opportunities. In contrast, a company running at six sigma generates 3.4 mistakes per million opportunities. With so few errors, the need for additional rework is drastically reduced, resulting in less than 5 percent of time and money being spent on quality.
2 While attaining this level of excellence comes with a price tag, many organizations tend to overlook the expenses associated with a lack of maintenance. Once these costs are considered, investing in upgrading systems or processes can substantially decrease long-term expenses and enable employees to engage in more productive tasks. Employee-related process failures typically fall into these two categories:
Correct methods were not taught accurately or assessed for proficient execution.
Correct methods are understood but not implemented due to careless mistakes, insufficient skills, or time constraints (a shortened deadline). In a culture of process excellence, establishing a framework for interdepartmental collaboration, transparency, and process visibility becomes essential. A robust infrastructure sets the stage for identifying and eliminating obstacles, fostering an environment where excuses hold no ground. It encourages a proactive approach to process innovation, even amidst competing priorities and busy schedules. A hallmark of an excellent culture is when employees recognize the distinction between improvement and change. Change involves altering something, whether it's the color, shape, or a complete redesign, and while change may lead to improvement, it's not a guaranteed outcome. Similarly, investing significant time and effort in altering a process doesn't automatically translate to improvement; improvement must be measurable in some way. When employees tackle a challenge, my first step is encouraging them to delve into why that specific issue is essential. As a practitioner, I consistently push them to articulate the logic behind investing time and resources in these improvements. Questions such as, "What makes this effort worthwhile? What benefits do you expect to achieve?" are crucial. I've observed that employees often find it challenging to express the rationale behind their proposed changes. It's imperative for them to discern early in the process whether they're initiating a change to the process or genuinely improving it. Misjudging this distinction could lead to the wastage of valuable resources. Extracting Lessons From Failure In organizations valuing problem-solving, innovation, and engaged employees, failure is embraced as an inherent aspect of the learning journey. Teams openly discuss both successes and failures, fostering confidence and granting access to the essential resources for finding solutions. Conversely, in environments where failure is not tolerated, secrecy and a lack of transparency tend to characterize the culture. Keeping vital information hidden results in ill-informed decisions and choices made with incomplete data. Stories shared within the organization should inspire and captivate employees while conveying valuable lessons about the company's culture and values. One of the most memorable moments in my career was the day a meeting was called to discuss a significant issue with our flagship product. At that time, we didn't have a redundant copy of our application to minimize interruptions, and the product had been intermittently down for several days. The impact on the customer and our client services increased with every moment of product instability. The tension in the room was palpable, and the body language of the person trying to explain the situation was a masterclass in "I'd rather be anywhere else." Everyone was eerily quiet as they awaited the reaction of the senior manager. The pivotal moment our company's culture took a turn in the right direction came when I heard his response. "What did we learn?" Four simple words completely transformed the energy in the room. It allowed the team to fully analyze the missteps and proactively engage in discussions leading toward a solution. Most importantly, valuable time wasn't squandered on assigning blame or seeking punishment. Assume employees tried their best with the resources at hand, so falling short is seen as part of the learning process, with the rest of the team pitching in to assist. Issues are rarely caused deliberately or with malicious intent. When an engineer at Pixar accidentally deleted the only working copy of
Toy Story 2, the entire team immediately launched into action in trying to find a recovery solution. As the CEO tells the story, the team focused on three items after the accident: restoring the film, fixing the backup systems, and installing precautionary restrictions so the incident...
