The Lean Management Systems Handbook

Introduction to Lean Management
In a Nutshell
Overview
     Dawn of Lean Manufacturing 
     Porsche and the Lean Transformation
Performance Management 
     Raw Material, Work-in-Process, and Finished Goods Flow 
     Operator Flow in Relation to Machines 
     Information Flow 
     Engineering Flow
Asset Management
Resource Management
     Cellular Manufacturing
Risk Management
Lean Management System Deployment Model 
     Lean Performance Management 
     Lean Workers Cross-Training 
     Change Management for Senior Management Teams 
     In-House Lean Deployment Projects 
          Toyota Lean Management System Explained 
          Lean Management and Green Revolution
Summary
References

History Of Lean
In a Nutshell
Overview
Lean Techniques
Venetian Arsenal (1104–1800)
Eli Whitney (1792–1805)
Eli Terry (1772–1852)
Frederick W. Taylor (1856–1915)
Frank Gilbreth (1895–1924)
National Cash Register Company (1896)
Henry Ford Sr. (1863–1947)
Charles Bedaux (1887–1944)
Walter L. Shewhart (1891–1967)
Harold F. Dodge (1893–1976) and Henry Romig (1893–1972)
Henry Ford II (1917–1987)
Kaoru Ishikawa (1915–1989)
Armand V. Feigenbaum (1922–Present)
Taiichi Ohno (1912–1990)
Shigeo Shingo (1909–1990)
Phil Crosby (1926–2001)
Process Benchmarking (1947–Present)
Joe Juran (1904–2008)
Yoji Akao (1928–Present)
Ibm’s 1980S Approach to Quality Improvement
W. Edwards Deming (1900–1993)
Total Quality Management (1984)
Eliyahu Moshe Goldratt (1948–2011)
Fast Action Solution Technique (1980)
Malcolm Baldrige National Quality Award (1987)
Bill Smith (1929–1993)
Lean Manufacturing (1988)
Michael L. George (2002)
Jeffrey K. Liker (2012)
Lean Management Systems (2014)
Summary

House of Lean (Foundations of a Lean Management System)
In a Nutshell
Introduction
House of Lean Management 
     Transition to the House of Lean Management 
     Lean Activity Model
     A Framework for Lean Management Implementation 
     Inclusion of Lean Management System Indicators and Metrics 
     Conditions of a Lean Learning Enterprise 
     Lean Socio-Technical System 
     Lean Educational System 
     Lean Change Management
     Four Pillars of the Lean Management Model 
     Summary of the House of Lean Management
Five Foundation Stones of the Lean Management System 
     Foundation Stone I: Process Management Excellence 
          Two Approaches to Process Management 
     Foundation Stone II: Project Management Excellence 
     Foundation Stone III: Change Management Excellence 
     Foundation Stone IV: Knowledge Management Excellence 
          What is Knowledge? 
     Foundation Stone V: Resource Management Excellence 
     Documents Needed for the Lean Management
     System Strategic Vision 
     Strategic Vision Sponsor’s Role
Summary
Useful References and Associated Readings

Lean Management Systems
In a Nutshell
Overview 
     Toyota Challenge 
     Views on Toyota’s Management
Lean Management System 
     Education 
     Application 
     Communication
Defining Your Lean Management System 
     Lean Management System Scorecard 
     Learning Management Model (Senge) 
     Strategy Management Model (Jackson) 
          Nine Keys to Lean Management System 
          Control Points 
          How to Score 
          About the Score 
     Operations Management Model (Shingo) 
          Shingo Model Versus Common Practices 
     Summary 
     Reference

Lean Socio-Technical System: on Developing a Lean Culture
In a Nutshell
Overview
     Lean Culture Defined 
     Psychological Human Needs
Employee Behavior Drivers 
     Measures Drive Behavior
     Beliefs Drive Behavior 
     Motivation Defined 
     Motivation as the Driving Force 
     Fear Drives Behavior 
     Hierarchy of Needs
Theory X and Theory Y Management Philosophies
Key Social System Implementaion Challenges
Summary

Lean Educational System
In a Nutshell
Overview
Lean is for Everyone
Purpose of a Lean Educational System 
     Lean Education System Starts with Management
Lean Education Strategy
     About Learning Management Systems
     Lean Management Education Description
Lean Educational System: Lean Learning Cycle™ 
     Lean Learning Activities 
          Lean University 
          Employee Road Maps and Cross Training 
     Education Deployment (Hoshin Kanri) 
     Lean Educational System Definition 
     Knowledge Application (Kaizen) 
          Kaizen and You 
          Kaizen and Teams 
          Kaizen and Process Troubleshooting 
     Knowledge Sharing 
     Grading Outcomes
Key Education System Implementation Challenges 
     Time and Resource Commitment 
     Discarding Old Beliefs 
     Transitioning to a Learning Organization
Summary

Waste Identification
In a Nutshell
Overview
What is Variation? 
     How Do we Chart Variation? 
     Why is Understanding and Controlling Variation So Important?
What is Waste? 
     Defining the Value-Added Work Components
How Does Waste Creep Into a Process?
Power of Observation
Seeing with New Eyes 
     Waste 1: Overproduction 
          What Causes Overproduction? 
          How to Identify Overproduction
Waste 2: Excess Inventories 
     What Causes Excess Inventory? 
     How to Identify Excess Inventory     
Waste 3: Defects 
     What Causes Defects? 
     How to Identify Defects
Waste 4: Extra Processing 
     What Causes Processing Waste? 
     How to Identify Processing Waste
Waste 5: Waiting 
     What Causes Waiting Waste? 
     How to Identify Waiting Waste
Waste 6: Motion 
     What Causes Motion Waste? 
     How to Identify Motion Waste
Waste 7: Transportation
     What Causes Transportation Waste? 
     How to Identify Transportation Waste
Waste 8: Underutilized Employees 
     What Causes Underutilized Employees Waste? 
     How to Identify Underutilized Employees Waste
Waste 9: Behavior 
     How to Identify Behavior Waste
Summary
References

Waste Quantification: Learning to Measure
In a Nutshell
Overview
     Background
Measurement Systems Theory 
     Lean Performance Measurement 
     From Lean Production to the Lean Enterprise 
          Assessing Your Current Measurement System 
          Technical Attributes of Lean Measures 
          Technical Attributes of Good Measures 
     Lean Production Measurement Process 
          Evaluating Your Lean Measures Technical Characteristics
          Policy Deployment Model 
          Ensuring Success of the Model in a Lean Environment 
          Technical Aspects of Lean Measures 
          Behavioral Attributes Associated with Lean Measures 
          Cultural Attributes Associated with Lean Measures 
          Performance Measurement and Lean Production Processes 
          Measurement Visibility 
     Measurement Relationships 
          Single Source of Measurement Information
Measurement Systems Practice 
     Why Measure
Types of Measures
Measures and the Supplier–Customer Relationship
Lean Measures Versus Non-Lean Measures
How Lean is Your Current Measurement System
Critical Components of the Lean Measurement System
Selecting New Lean Measures
Measuring Performance Over Time
Summary

Lean Concepts, Tools, and Methods
Overview
Traditional Organization Operational Philosophy
Lean Operational Philosophy
Lean Management Concepts 
     Waste 
     Value-Added Activities 
     No-Value-Added Activities 
     Business-Value-Added Activities 
     Waste Identification 
     Waste Elimination 
     Value Stream
     Value Stream Management 
     Continuous Flow
     Pull Systems 
     Point of Use Storage 
     Quality at the Source 
     Just-in-Time 
     Kaizen
     5M’s: Materials, Machines, Manpower, Methods, And Measurements 
     Key Process Input Variables 
     Key Process Output Variables
Lean Tools 
     5S Workplace Organization and Standardization 
          Just the Facts 
          5S Means Action 
          Common Omissions when Implementing 5S 
     Overall Equipment Effectiveness 
          Just the Facts 
          How to Use OEE 
          Applying OEE in Nonmanufacturing Environments 
     Mistake Proofing 
          Just the Facts 
          How to Use Mistake Proofing 
     Cellular Manufacturing 
          Just the Facts 
          How to Create Manufacturing Cells 
     Kanban 
          Just the Facts 
          How to Use Kanban 
     Value Stream Mapping 
          Just the Facts 
          Managing With Maps 
     Visual Controls 
          Just the Facts 
          How to Use Visual Controls
The Power of Lean Concepts and Lean Tools 
     Composite U-Cell Case Study 
          Lean Six Sigma Concepts and Tools Used Summary
References

Three Faces of Change: Kaizen, Kaikaku, and Kakushin
In a Nutshell
Introduction 
     Resistance to Change 
     Fear of the Unknown 
     Measurement Systems 
     Beliefs
Overcoming Resistance to Change 
     Leaving Old Beliefs Behind 
     Considering New Possibilities 
     Emergence of Lean Six Sigma
Three Faces of Change 
     Kaizen: Continuous Improvement 
     Kaizen and you Method 
     Kaizen for Process Troubleshooting 
          Step 1: Go to Gemba 
          Step 2: Conduct Gembutsu 
          Step 3: Take Temporary Countermeasures on the Spot 
          Step 4: Find Root Causes 
          Step 5: Standardize to Prevent Recurrence 
     Kaizen Teams 
     Possible Target Areas for Kaizen Teams 
     Preparing for Kaizen 
     Team Member’s Roles in Kaizen 
     Overcoming Obstacles During Kaizen
Kaikaku: Transformation of Mind 
     How do We Recognize Kaikaku (Transformation of Mind)? 
     Kaikaku in Cell Design 
     Kaikaku in Facility Layouts      
Kakushin (Innovation) 
     The 20–20 Innovation Process
Summary
References

Lean Thinking 101
In a Nutshell
Overview
     Origins of Lean Thinking 
     Dell Lean Thinking Journey 
     Ebay Way to Lean Thinking 
     Microsoft Weighs in 
     Basic Values and Principles of Lean Thinking 
     Dreaming About Perfection 
     Apple and Perfection 
     Basic Principles of Lean 
     Add Nothing But Value (Eliminate Waste) 
     Center on the People Who Add Value 
     Flow Value from Demand (Delay Commitment) 
     Optimize Across Organizations
References

Integrating Lean Management with DMAIC/DMADV
In a Nutshell
Overview
Goals of Lean Management
Goals of DMAIC/DMADV Lean Management Systems 
     DMAIC Process Clarified… 
     Recap of How DMAIC Works 
     Dmadv Process Clarified for LMS 
     Overview of How Dmadv Works in LMS 
     Comparing DMAIC and DMADV-LMS* 
Integrating Lean with DMAIC/DMADV 
     Lean DMADV-LMS Framework 
     Need for Tollgate Road Maps 
     DMADV-LMS Tollgate Road Map 
     Root Cause Analysis and Lean Management 
     Groups of Lean Management System–Related Root Cause Analysis Tools
Summary
Reference

Integrating Lean and Theory of Constraints
In a Nutshell
Overview
     Definition of Constraint
Comparing Lean and Theory of Constraints
Achieving Lean Effectiveness with Theory of Constraints
Tips for Lean–Theory of Constraints Projects
Theory of Constraints Critical Chain Project Management and Little’s Law
Integrating Lean and Six Sigma Under Theory of Constraints Example
Summary

Lean Management System: Organizational Master Plan
In a Nutshell
Overview
Phase I: Evaluate the Lean Management System Methodology 
     Activity 1: Starting the Interest in Lean Management Systems 
     Activity 2: Search for Knowledge on Lean Management Systems 
     Activity 3: Conducting the Lean Management System Assessment 
     Activity 4: Analyze Application of Lean Management System (Conceptual Evaluation) 
     Activity 5: Prepare Management Report (Deploying A Lean Management System) 
     Activity 6: Present Findings to Top Management
Phase II: Define Opportunities within the Organization 
     Activity 1: Define the Key Controllable Factors and Develop an As/Is Statement for Each 
     Activity 2: Conduct a Study to Define and Quantify the Opportunities
     Activity 3: Compare to Present-Approved-Improvement Plan Projects to Be Sure There Is No Overlap 
     Activity 4: Present the Results to Top Management 
     Activity 5: Assign a Project Manager and Project Team 
     Activity 6: Approve Phase III Budget
Phase III: Develop the Implementation Plan
     Activity 1: Develop Vision Statements for Each of The KCFS 
     Activity 2: Define Desired Behaviors 
     Activity 3: Prepare Individual Improvement Plans 
     Activity 4: Combine the Individual Improvement Plans 
     Activity 5: Prepare a Cost–Benefit Analysis (ROI) 
     Activity 6: Develop a Set of Performance Goals 
     Activity 7: Prepare the Lean Management System’s Project Plan 
     Activity 8: Present the Lean Management System’s Project Plan to Management 
     Activity 9: Include the Lean Management System’s Project Plan Into the Strategic Improvement Plan and the Organization’s Annual Operating Plan
Phase IV: Implement the Lean Management System Plan 
     Activity 1: Assign Implementation Teams 
     Activity 2: Define What will Be Done with Surplus People 
     Activity 3: Assign a Project Manager to All Stand-Alone Projects Starting in the Next 6 Months 
     Activity 4: Measure and/or Define the As/Is Status 
     Activity 5: Form and Train the Implementation Project Teams and the Subproject Team Members 
     Activity 6: Conduct an Organizational Change Management Assessment And Develop Appropriate Mitigation Plans 
     Activity 7: Train the People Who are Impacted By the Change
     Activity 8: Implement the Change 
     Activity 9: Conduct Phase IV Tollgate
Phase V: Measure the Results 
     Activity 1: Define What Measurement Should be Affected by Each of the Lean Management System
Projects 
     Activity 2: Define What, Where, and How Improvement will be Measured 
     Activity 3: Define How Changes in Behavioral Patterns will be Observed 
     Activity 4: Develop and Implement the Reporting System
     Activity 5: Train the Related Personnel in How to Collect Data 
     Activity 6: Collect and Analyze the Data 
     Activity 7: Conduct the Phase V Tollgate 
     Activity 8: Reward the Installation and Lean Management System Teams Based on Their Impact
Phase VI: Continuous Improvement 
     Activity 1: Sustaining The Gains 
     Activity 2: Ongoing Improvement
Summary
Reference

The Need for Facilitation
In a Nutshell
Overview
What is Facilitation?
     Some Basic Definitions 
     When Facilitation is Appropriate
Overview of Competencies and Characteristics
Where Do You Stand as a Facilitator?
What Specifically Comprises The Process of Facilitation? 
     Communications 
          Icebreakers
          Humor 
          Encouragement and Praise 
          Listening 
          Questioning 
          Checking 
          Giving Feedback 
          Nonverbal Communication 
          Speaking 
          Writing 
     Group Dynamics and Development 
     Simplify the Complex 
     Plan for, Structure, and Control Meetings and Lean Events 
     Provide a Safe Learning and Working Environment 
     Help People See and Understand 
     Help People Gather and Analyze Information to Drive Operational Improvements 
          Only Collect the Right Important Data 
          Be Concerned About Reliability and Validity 
          Get Help 
     Help People Make Decisions 
          Collaboration and Consensus 
          Force Field Analysis as a Powerful Tool 
          Multivoting as a Simple Technique for Helping A Team Reduce a Large Number of Ideas 
     Eliminating Non-Value-Added Activities 
     Focus on Process 
     Achieving Pull and Flow 
     Striving for Zero Defects
Summary

Facilitating Lean Management Systems (Developing A Lean Culture and Change Management Environment)
In a Nutshell
Lean Culture Development 
     David Mann’s Lean Culture
Change Management 
     Managing Transitions Model
     Process of Transitions 
     Helping Others to Change 
     Managing Complex Change
Facilitating Lean Management 
     The Facilitators Guide to Lean Management 
     Organizational Levels and Alignment
The Organization as a System 
     The Processing System Hierarchy Model
          The Organization as Systems Thinking
Catchball 
     Approach, Deployment, Learning, and Integration 
     Dmaic Roadmap 
     Leader Standard Work 
     Daily Accountability Process 
     Visual Controls
Some Tools to Facilitate Lean Management System Annual Improvement Projects 
     Use of Project Charters 
     Project Selection Matrix Template 
          Quality In Daily Work Accountability
Summary

Epilogue: The Shadow of the Leader in A Systems Thinking Environment
Appendix
Index

Biography

Richard M. Charron is the founder and president of The Lean Manufacturing Group, a South Florida company that provides a number of hands-on Employee Learning & Lean Implementation programs focused on waste elimination, productivity improvement, and profitability enhancement. He is a Certified Master Black Belt in Lean Six Sigma Excellence from the Harrington Institute. He has trained and coached over 100 teams in Lean manufacturing, Lean Six Sigma, and Kaizen events generating savings over $25MM. In conjunction with Strategy Associates, he completed a three-part DVD series on Lean concepts for the University of Central Florida. His expertise is in process performance excellence, Lean Six Sigma, Lean manufacturing, design for manufacturability, problem solving, product and process failure analysis, products development, and performance testing. Mr. Charron earned BS and MS degrees in plastics engineering from the University of Massachusetts. His MS Thesis "Product Liability in the Plastics Industry" is a survey of our legal system that spans the impacts of unsafe products and the ever-changing legal uncertainties. He is the author of a dozen technical publications on product quality, products performance testing, and products failure analysis.

In the book, Tech Trending, H. James Harrington was referred to as "the quintessential tech trender." The New York Times referred to him as having a "… knack for synthesis and an open mind about packaging his knowledge and experience in new ways—characteristics that may matter more as prerequisites for new economy success than technical wizardry…." Tom Peters, the author, stated, "I fervently hope that Harrington’s readers will not only benefit from the thoroughness of his effort but will also ‘smell’ the fundamental nature of the challenge for change that he mounts." William Clinton, past president of the United States, appointed Dr. Harrington to serve as an Ambassador of Good Will. It has been said about him, "He writes the books that other consultants use." Harrington Institute was featured on a half-hour TV program, Heartbeat of America, which focuses on outstanding small businesses that make America strong. The host, William Shatner, stated: "You (Dr. Harrington) manage an entrepreneurial company that moves America forward. You are obviously successful."

Dr. Harrington now serves as the chief executive officer for the Harrington Institute. He also serves as the chairman of the board for a number of businesses. Dr. Harrington is recognized as one of the world leaders in applying performance improvement methodologies to business processes. He has an excellent record of coming into an organization, working as its CEO or COO, resulting in a major improvement in its financial and quality performance.

In February 2002, Dr. Harrington retired as the COO of Systemcorp A.L.G., the leading supplier of knowledge management and project management software solutions when Systemcorp was purchased by IBM. Before this, he served as a principal and one of the leaders in the Process Innovation Group at Ernst & Young; he retired from Ernst & Young when it was purchased by Cap Gemini. Dr. Harrington joined Ernst & Young when Ernst & Young purchased Harrington, Hurd & Rieker, a consulting firm that he started. Before that, he was with IBM for over 40 years as a senior engineer and project manager.

Dr. Harrington is the past chairman and past president of the prestigious International Academy for Quality and of the American Society for Quality Control (ASQC). He is also an active member of the Global Knowledge Economics Council.

H. James Harrington was elected to the honorary level of the International Academy for Quality, which is the highest level of recognition in the quality profession. Dr. Harrington is a government-registered quality engineer, a certified quality and reliability engineer by the ASQC, and a permanent certified professional manager by the Institute of Certified Professional Managers. He is a certified Master Six Sigma Black Belt and received the title of Six Sigma Grand Master. He earned an MBA and PhD. in engineering management and a BS in electrical engineering. In 2013, the Degree of Doctor of philosophy was conferred on him by the Sudan Academy of Sciences for his "immense contributions, remarkable achievements, and distinguished accomplishments in the field of quality management, business excellence, and innovation, covering wider range of geographical locations and countries.

His contributions to performance improvement around the world have brought him many honors. He was appointed the honorary advisor to the China Quality Control Association, and was elected to the Singapore Productivity Hall of Fame in 1990. He has been named lifetime honorary president of the Asia Pacific Quality Control Organization and honorary director of the Association Chilean de Control de Calidad. In 2006, Dr. Harrington accepted the honorary chairman position of Quality Technology Park of Iran.

H. James Harrington has been elected a fellow of the British Quality Control Organization and the ASQC. In 2008, he was elected to be an honorary fellow of the Iran Quality Association and Azerbaijan Quality Association. He was also elected an honorary member of the quality societies in Taiwan, Argentina, Brazil, Colombia, and Singapore. He is also listed in the "Who’s-Who Worldwide" and "Men of Distinction Worldwide." He has presented hundreds of papers on performance improvement and organizational management structure at the local, state, national, and international levels.

Frank Voehl was certified as a Grand Master Black Belt in Lean Six Sigma and Organizational Excellence Senior Counselor in process and innovation performance excellence, Lean Six Sigma, design for Six Sigma, Lean manufacturing, problem solving, accelerated performance improvement, and policy deployment. He has 35 years of practical experience in leadership for process enhancement, change management, and program development and operations leadership at FPL’s QualTec as COO, Strategy Associates CEO/ president, and COO/chancellor of the Harrington Institute. He is an expert in the application of the process enhancement, and innovation tools and methods. He trained and coached over 300 teams in Lean manufacturing, problem solving, rapid process improvement, and process management. These teams generated savings over $120MM annually. He is a noted author and series editor of over 30 books and hundreds of articles and technical papers in the field of business management and improvement. He provided input on the original design of the Malcolm Baldrige National Quality Award and facilitated its crossover to other nations and regions, including the Bahamas, South America, Europe, and the Czech Republic.

Hal Wiggin is a Certified Six Sigma Master Black Belt who has been involved in government and agency organizational development and process improvement activities for over 30 years. He was the director of Planning and Quality Improvement for the Broward Children’s Services Council and regional manager of Performance and Planning for the Florida Department of Children and Families. He was a senior examiner for the Florida Sterling (Baldrige) Council. He started his career as a mental health counselor and school psychologist before completing a doctoral program in educational leadership. He is a planner, trainer, and quality improvement professional. Besides Lean Six Sigma, he has specific expertise in strategic planning, measurement systems, situational leadership, coaching, and group facilitation. He is currently helping Nova Southeastern University develop and implement a new Lean Six Sigma program. He is an adjunct assistant professor in the College of Osteopathic Medicine and he consults in health care, government, and other industries.

"... a valuable training aide to those contemplating the use of lean management or desiring a reasonably thorough refresher on lean management concepts. For those who have no background in lean management, this text provides an excellent and thorough introduction. ... Overall, The Lean Management Systems Handbook is a reasonably priced text that provides a fine overview of Lean management and has sufficient detail to enable the reader to grasp most of its theory and requirements."
—Jerald Silverman, DVM