Category archives: Uncategorized

Lean, cost cutting and my two laptops

An IT Consultant told me “Lean is about cost cutting and we do need some of the back ups that are mission critical. As such, IT people can’t use LEAN.”

A common misconception is that LEAN is about cost cutting. Cost savings is a result of LEAN processes. LEAN is not about cost cutting without a thought to the processes. LEAN doesn’t advocate cutting costs on essential processes.

LEAN is all about efficiency. LEAN achieves this via engagement of people and a clear process that they can apply to become efficient. As a result of an engaged workforce, a clear process of measurement and business communication, costs will reduce.

LEAN is therefore not about cost cutting until an organization is reduced to ‘skin and bones”. In fact, LEAN advocates adequate backups. In Failure Mode Effect Analysis, the team analyze the following factors:-

1. Severity of a potential breakdown. How bad is the effect of a potential breakdown.

2. Detection – how easy is it to detect a potential breakdown.

3. Frequency of occurrence – how often the breakdown has occurred in the past.

Based on the three factors above, the team will be able to identify mission critical equipment that needs backups. Conducting this analysis led me to keep two laptops. The severity ranked 10, detection 5 and frequency 1. Multiplying the 3 gave a score of 50. We do keep all important data backed up both on a hard drive and also on a cloud.

LEAN is about efficiency and LEAN has backups to ensure that efficiency isn’t affected. When my laptop crashed (although infrequent) without any warning, I was very grateful for the backup laptop and was able to continue work immediately. The concept of LEAN, while predominantly used in manufacturing is applicable to any industry, including IT.

macbook-air-2014-window-100266476-large

Leadership Lessons from the Front Line – Go to the Gemba

Reading about leadership in the books is very different from going down to the front line and implementing leadership in a factory. For one, it’s hot, dusty and dirty.I’d like to share some of this so perhaps you don’t have to get hot, dusty or dirty (at least not for the moment).

A key lesson in most LEAN textbooks is “go to the gemba” or go to the front line. Implementing this practice has taught me three key lessons:-

  1. People are inherently good. They want to do “the right thing”. No one wakes up with bad intentions and a desire to cheat.
  2. Going to down (“turun padang”) and support the front line ask questions (instead of critiquing) helps achieve business results.
  3. Leaders shouldn’t make assumptions until they spend some time on the front line.

Case Study

One of the plant managers I work with was very frustrated with his lab team. He told me that they weren’t making their targets and their work was late. Over lunch, he mentioned that he would issue a warning letter if they didn’t start working. I asked him to hold on and in line with LEAN, let’s have a look at how they work. We agreed to spend the afternoon at their workplace and observing them and asking questions.

We spent the afternoon at the lab. We asked the team how things were. We asked them to show us their processes and how they worked. Spending the afternoon with them was beneficial as it helped reinforce the following messages:-

  1. The leaders care about you and your team.
  2. The leaders are there to support you and your team.
  3. If you don’t meet your targets, we are there to help make your job easier so we can all meet our targets.

We saw their processes. The testing process involved writing results into 4 logbooks, using a calculator to input the results into another logbook and then logging the final results into a computer that constantly hung.

The process was a case study for waste. The logbooks happened to be all over the lab which meant there was waste of motion. With multiple data entry points, it was no wonder that there were frequent errors. The slow computer caused delay and frustration among the team. It was not surprising that the team didn’t meet their deadlines.

Key lesson No 1.

None of the lab team had the intention of not meeting their deadlines. They all wanted to do good work. They were very frustrated that they couldn’t do good work. People all want work well – you just have to find a way to help them work better.

Key lesson No 2.

Go to the front line. Ask questions. The questions are more powerful than giving the answers.  Our questions included the following:-

  1. Is this process efficient?
  2. What do you need to make it more efficient?
  3. How can we support you to help you meet your deadlines?
  4. What suggestions would you have to help your work?

These coaching style questions helped get the lab team to think. They also helped put the ownership of the processes with the lab team. In a lot of cases, companies will hire productivity consultants who will write new Standard Operating Policies. These thick books will rarely be read and kept in the management library in mint condition. The SOPs will not be implemented as no one reads them nor do they feel ownership of the processes.

Key lesson No 3

Not making any assumptions is essential before you go down to the front line.By withholding judgment of the team, and keeping an open mind, the plant manager was able to delve into the root cause of the issue with the cooperation of the team.

The benefits of making the team re look at their own processes are as follows:-

  1. The team work on this process every day. No one knows the process better – certainly not a consultant and definitely not a manager.
  2. By getting the team to improve the process they take ownership for this. The issue of non-compliance doesn’t arise as they worked on this process. They certainly wouldn’t rewrite a process that they couldn’t follow.
  3. The team also feel greater ownership and sense of engagement within the organization. By implementing ideas from the front line, people feel recognized. This increases employee engagement.

Instead of issuing the warning letters to the team, the plant manager now had a better understanding of the team. By helping the team, he had increased the trust and respect the team had for him. This resulted in :-

1. An engaged team. The lab team are now giving 1 improvement idea per person/month vs 1 improvement idea per team/month. This shows a measurable increase in engagement as well as ownership of the business.

2. Better business results. The lab was now able to meet their on time goal for a whole month.

3. This has translated into better business performance and better results for the organization.

As a leader, keeping the three key lessons at the top of mind when working with your teams will help you drive sustainable performance with your teams. It will also lead to a better culture which in turn leads to greater profits. For further details on how your company can develop a culture of ownership, please call us on 03 6201 4355.

LEAN Lessons from Ramadan

The recent month of Ramadan was an example of how people from all walks of life are able to perform at a world class level. When we talked to the front line workers at a factory, all 100 had ensured that they and their family of 3-5 children and a spouse broke fast on time. This was nothing short of a military operation executed with German/Japanese precision. We found they had applied the following

1. Clear responsibilities and a shared meaningful goal. In most cases, the wife knew it was her responsibility to prepare the evening meal. If she was unable to do it, she would inform the husband earlier and he would buy back food. For the whole month, the shared goal was that the family would break fast together on time

2.  Simplifying processes, increasing speed and clear communication. To ensure that the family broke fast on time, they used the television and had it switched on at 725pm (break fast time was 733pm). Everything that could be done earlier was prepared earlier – e.g. laying of table, cleaning of children, cooking/purchasing of food at the market. Responsibilities for the various tasks were delegated out as everyone knew their role in achieving the shared meaningful goal.

3. Waste elimination. All waste was eliminated at the time of break fast. Food was ready, people were seated. As such, the meal and Maghrib prayer was normally completed by 8pm.

The family break fast during Ramadan is an incredible example of application of LEAN principles in action. It shows what people are capable of when working towards a shared and meaningful purpose.

Our team has worked to help many organisations develop meaningful purpose, implement clear processes and this has resulted in profit increase. Our clients who include F&N, Malayan Flour Mills, Dindings Poultry Processing, Continental Tires and Nestle will be showcasing this at our related company’s CDI LEAN summit on 16th October 2014 at the F&N Dairies Plant in Pulau Indah, Klang. Do email admin at cdisea.com for further details.Microsoft Word – CDI Lean Summit2.docx

 

Simplifying Work

A lot of our work involves making complex concepts simple. Yet, during my time in the corporate world, many corporate structures became increasingly complex. On the journey to LEAN/World Class, we look at simplifying processes and ensuring teams have a process of business communication (and problem resolution).

This TED talk by Yves Morieux is very relevant and refreshing. His principles make sense and aligned with LEAN management.

Yves Morieux – Simplifying Work

CRM and Market Segmentation Implementation – Key factors for success

We have just completed a change program for a major bank to help their managers understand how market segmentation worked and implement it. This was a country wide implementation and we went to the regions to share this knowledge and change mindsets towards CRM. Many of the managers had negative ideas about CRM and this was shared by their staff.

The team used the Pareto principle to work on their own customer database (20% of their customers represented 80% of their profits). They worked out which customers to focus on for growth and how to use the customer product life cycle to target the correct products. We used financial and non financial examples for this.

Non financial example – Facebook ads – market segmentation in practice.

1. Facebook status – engaged,  ads were for marriage courses.

2. Facebook status – married,  ads were for “toys to pleasure the wife”. Other ads which followed included supplements to enhance my married life.

3. Facebook About – Updating profile as business owner. Ad on hiring top talent easily.

When utilizing, CRM, a clear understanding of who your target market is essential. The more detailed, the better, e.g. customers tend to range between 30-45, degree holders, living in these postcodes, married, with children. Facebook marketing allows a marketer to drill down to hit just a select group of people.

The program worked as we had the in house team who were able to demonstrate how to use the system. This involved hand on expertise on the process of utilizing the CRM database as well as how to segment in the financial world.

In any transformation, the what and the why are the easiest to implement. The key issue is now the “how” of implementation. This was not only addressed in how to use the processes but also how to change the mindset of the branch towards CRM. It involved people and mindsets. Understanding how people worked and what motivated them (beyond pay) was essential. We also needed to share the importance of world best practices in terms of the morning huddle. As many of the managers were Gen Xers or Boomers, a short introduction to the coaching style of management was essential.

The program was conducted for 300 managers. We were able to achieve the following results:-

1. Measured increase in the lead utilisation rate.

2. Increase in the number of customized campaigns coming from the managers.

The key factors for our success were as follows:-

1. Contribution from the client side. All departments, from CRM, Sales, and Learning worked together to ensure the success of this project. There was no politics but instead total collaboration to meet our goals.

2. Flexibility in terms of managing the content of each intervention. With a large number of managers with different levels of understanding, the key was a flexible program that managed to address the needs of the managers.

3. Focus on the how. Most interventions focus on the what and why and not the how. Here almost 75% of the time was spent on the how.

 

Customer Service Processes- Booq Bags

As a seasoned traveller, I finally made the decision to get a smaller and lighter laptop. A trip to the store later and I had a new laptop. For some reason, there were few bags that fitted my laptop. A google search led me to Booq bags that made custom fitted bags for Macs. Having discovered them online, I now needed a Malaysian retailer/retailer that shipped to Malaysia.

Booq customer service (Pre-sale)
When I wrote into Booq bags to find a retailer, they responded within 24 hours via email. This is really important. You need to make sure that you capture your customer at the point of interest. Delay can result in lost business.

The product experience

Within a couple of months. the strap of my bag started to fray and it looked like this.

Damaged strap

Booq customer service (Post sale – aka return process)
I emailed the pictures of the frayed bag strap to the customer service email. The reply came within 24 hours. They requested 3 pictures and my mailing address.

Traditionally, companies requested you to :-
1. Send back the damaged product (pay international postage)
2. Which they would then examine and then decide if it was a product fault or if it was out of warranty or if they should replace it.
3. And communicate accordingly to the customer.

I was pleasantly surprised when Booq informed me the replacement strap would be sent to me at their expense.

By doing the right thing and cutting down on their processes, they have saved their staff time as well as retained a customer who will then tell others about their service.

Key takeaway.
Making the return process simpler and less expensive created customer satisfaction and loyalty. It has also impressed me so I will probably by my next bag from Booq.

Companies should regularly examine their processes and see how to simplify them. The increase in productivity and customer satisfaction will generate substantial returns.

Deal with it!

Mr Yam is an example of a person who learned how to deal with adversity. This is a short video of how he overcame blindness in 2008. He now not only leads a full life but has also returned to the golf course.

Lessons from Nathalie’s Gourmet Studio

I was recently invited to learn how to cook duck confit as well as green tea tiramisu at Nathalie’s Gourmet Studio by Chef Nathalie herself.

The cooking lesson highlighted the importance of many fundamental business principles.

Both duck confit and green tea tiramisu requite a lot of planning and preparation.

1. Spend where it counts.

The duck for the duck confit is reared on an organic farm. Nathalie uses President butter imported from France (trust me – it tastes really good). When you are cooking, you need to get good ingredients where it counts. For a business, make sure you spend money where it counts. We spent money on a really powerful projector at the office so that participants won’t have a problem viewing the slides even in daylight. We also spent on a warranty which makes sure that we have a same day replacement in case anything goes wrong.

Duck and friends

2. Cut costs provided it won’t affect the end product.

Nathalie uses sea salt but she doesn’t need designer sea salt (which can cost 10-20 times as much) as local sea salt will taste the same.Cut costs provided it won’t affect the end product. We use a basic speaker system at the office in the training room instead of a thousand dollar designer system as we don’t need hi-fidelity sound in a meeting/training room.

Local Sea Salt

3. Prepare, prepare, prepare. The preparation process is really painstaking for duck confit. First the duck is marinated in sea salt for at least 24 hours. Then the duck is rinsed and slow cooked in a tub of duck fat for a couple of hours. Then the duck sits in your fridge for at least a week. Before serving the duck is then put in a preheated oven for 20 mins.

Duck confit

Without proper planning or preparation, there is no way that I will be served my duck confit over my 1 hour lunch break. When I was at the cooking lesson it looked really easy as all the ingredients were already prepped beforehand. Takeaway -when you have a large task looming, prepare all that you can do in advance. When we have training sessions, we have a standard practice for preparation of manual and slides and if we host the training, we ensure that restaurants are booked, tea breaks and other supplies are prepared. This frees us up on the day of the event.

The finished product - duck confit on a bed of orange salad

4. Processes. The entire operation of Nathalie’s Gourmet Kitchen has to work seamlessly. The wait staff have to make sure that they know the stock levels of the food so they can recommend what’s in stock to the customers. There’s nothing worse than listening to a great description of a dish only to find that it’s unavailable. They also have to work with the kitchen to make sure the order is processed. As frontliners, they have to give feedback to the kitchen on the food from the customer. They are also used to upsell other products such as desserts or drinks. The kitchen team need to make sure that they don’t miss an order. They also don’t waste time. While we were waiting for food to cook, we continued to cook and prepare dessert which was a lovely green tea tiramisu.

Green tea tiramisu

I noticed that the ultimate quality control is Nathalie herself who checks every dish before it leaves the kitchen. The results of their stringent processes are below.

Takeaways – Ensure that your processes support your work and aid not hinder efficiency. Also, use processes to improve efficiency. I have a meeting at least once a week with my team to let them know what’s going on and what they have to do to plan for it so they know when is a good time to take leave and when they will be bogged down. Our constant improvement process means that we don’t shout at people for mistakes but we look to learn from them and implement processes to ensure that they don’t happen again.

Pop down to Nathalie’s Gourmet Studio to have a look at these lessons being practiced – FYI the food is great too. Stay tuned for directors training in conjunction with Nathalie’s Gourmet Studio!

Sustainable Change in Organizations – Gathering of the Great Minds

I recently spoke at the Gathering of Great Minds organized by Live and Inspire. My topic was sustainable change in organizations. I talked about sustainability in terms of people, organization and the environment. This Q&A by Gerald Chuah of the NST is a good summary of the talk.

Smart Office Solutions – Whitespace International

This is my latest article on Whitespace International, a smart office solutions provider, published on www.liveandinspire.com.

A lot of people have asked me how to start your own business. In this case the Nike adage “Just do it” is probably the best advice. One of the first questions is on getting a business premise or office.

One of my friends was looking at getting a business address in Solaris Mont Kiara. Since my office was there, he came by to have a look. I was immediately impressed by the way this place looked. It was clean and uncluttered. What also impressed me was the way my call was handled. The business administrators were polite, spoke good English and referred me to the Director very quickly.

Whitespace international was founded on smart business sense. As a virtual office, it has the basics you would expect such as nice office space, meeting rooms for rental, fax, email and receptionist services. However, it’s more than just a virtual office.

Their tagline is “Business Space Redefined”. It starts off at RM99/month moving up to RM299/month. What I liked about the packages is that you are not tied down for any particular period and you upgrade/downgrade as required without penalty. The Business Administrators are friendly and intelligent and able to help with referrals for accounting/audit firms, legal firms and company secretaries. They can also courier documents, order food etc. Should you need a room, you can book the meeting rooms by the hour.

What lessons could we learn from Whitespaceinternational?

1. Process excellence – their processes are impeccable with constant training and a detailed operations manual to ensure that processes don’t fail.

2. Get the right people. The process of hiring the business administrators is not easy. They have a 10% hire rate (after screening people) as they need to hire the right staff. Enable them and allow them run with their own initiatives.

3. Establish your niche vs. the competition and communicate this. They don’t just sell virtual office space – what they do is that they offer a smart business solution with well-trained Business Administrators. They also offer training sessions for entrepreneurs to increase their value add proposition.

4. Focus on the customer and have customer friendly policies such as variable packages and no minimum sign up period.

Their business is expanding and they are looking at a nationwide presence in Malaysia for starters. If you are interested in starting a business, this is one way to keep your costs down. On a personal note, I have been so impressed by this business I am now exploring ways to work with them.