Practicing what we preach

Even if many of the speakers who come before COE members have lean-transformation success stories to share, all of those tales have to start with some gory details about problems at their organizations. In the spirit of quid pro quo, I’d like to share one of ours and fill you in on what we’re doing to make it better. Think of it as the Fisher College version of US Weekly’s “Stars: They’re Just Like Us!”

Our Dec. 2 seminar featured fantastic and well-received presentations from Cardinal Health Inc. and Starbucks Corp. (don’t believe me? Check out these pics). If you logged in to watch either of these events via a live webcast, however, you got a front-row seat to some technical problems we had in the morning and afternoon. Live audience members in the afternoon were privy to an audio glitch at the start of the Starbucks presentation as well.

Fisher College COE cause mapping
COE joined with the audio and visual teams that helped with the Dec. 2 seminar to dissect some of its glitches.

In a world without lean thinking, we’d hoist the blame on the shoulders of the good folks at Fisher and the Blackwell Hotel who handle audio and video for us and be done with it. Easy? Sure. Fair? Not at all. So in the spirit of lean thinking, we spent a half-day this week creating cause maps with the audio and visual teams that revealed a number of issues that fueled the fire. And like the dutiful lean thinkers we are, we emerged with some proposed changes to our event planning and execution next year that should boost the quality of COE members’ experience and lower our blood pressure readings.

It’s disheartening and even scary to dig beneath the surface and expose the frayed wires in our process but they remain a problem waiting to happen until you do.

Discuss: How has operational excellence influenced the way you or your organization dissects problems after they occur?

COE member Cardinal Health gets supply chain honors

Sometimes the scope of the machine can obscure the beauty in the little cogs that make it all work. Take Center for Operational Excellence member Cardinal Health Inc. for example: It’s a $100 billion-plus company, highly profitable, one of the largest employers in the Columbus area and manager of a network of distribution centers so vast its products can reach a staggering share of hospitals nationwide in no time flat.

It’s also an extraordinarily efficient and nimble enterprise, having navigated through the recession with few bruises, shed a piece of itself to create a new West Coast entity and plotted an ambitious expansion into Asia that could pay untold dividends in the future. It’s the efficiency and its translation into high-quality service to customers that has captured the attention of the number-crunchers at research firm Gartner, which recently named the Dublin-based company the No. 1 health-care supply chain in the nation.

To reach No. 1, Cardinal moved past last year’s holder of the top spot, Owens & Minor, which slipped to No. 5 this year. Nos. 2-4, in order, were Mercy, BD and the Mayo Clinic.

It’s reasons quantitative and qualitative that got Cardinal the honors. Gartner perused data on financials and inventory levels, combining that with other survey data and peer opinions (Cardinal’s top-notch there, in specific). The company in bestowing the honor called Cardinal “a complex combination of well-connected businesses … (that) combines the varied strengths of a medical-surgical distributor, a pharmaceutical wholesaler and a large manufacturer.”

So why all the hoopla over a health-care supply chain? Gartner gets at a key distinction that strikes at the heart of why operational excellence in the health-care realm is so important: “Losing sight of the customer, in most industries, results in frustrated tweets and blog posts about a product or service that may lead to lost sales opportunities. Losing sight of the patient, however, can reduce the quality of life for particular patients and, in the worst case, can lead to the loss of life.”

So congratulations to Cardinal, an all-star on COE’s roster that recently came to Fisher to share its lean story at our Dec. 2 quarterly seminar.

A congratulations by proxy goes to fellow COE member Abbott Nutrition, whose sister pharmaceutical operation made Gartner’s top 10.

MBOE recap: Graduation day

“Remember that you have the best knowledge, and you learned from the best.”

These words came from a student wrapping up her capstone project for Fisher’s industry MBOE program, which ended its third intense and exhilarating year Saturday. This group of doctors, nurses, plant managers and administrators learned and shared principles of lean and applied them at their workplace, changing the way that work is done.

And this weekend they made it, walking away with a degree that’s one-of-a-kind in the U.S. Many sacrifices were involved. Instead of taking their kids to the zoo or going out for dinner with spouses and family, they worked on their six-sigma modules. They gave more than 600 hours this year for their professional development, making a positive change at their workplaces. Their projects were aimed at making shop floors and hospital units safer and easier for employees to use, resulting in satisfied customers/patients and a positive bottom-line impact. That learning, guided by some of the best coaches in the country, spread to others that they, in turn, taught.

MBOE Graduation
Fisher’s industry MBOE cohort at commencement

Some snapshots of the final moments of the MBOE cohort:

The management team from the Evansville school system in Indiana raved about how they successfully made big and small changes. Speaking of the MBOE program, one leader suggested that companies should work “to get your whole team in the program and you will see the widespread improvements.” I have not seen such open-minded executives who are willing to change first before making changes to their organization.

Two students – Dale Scott, lean manager at GE Technology Infrastructure; and Michael Raisor, executive director of process improvement at the Evansville school system – spoke at the pre-commencement session in the evening, an emotional tribute to the camaraderie in the class and the support they received.  Helen Zak, president of the Healthcare Value Leaders Network, inspired students to make use of the knowledge and think about how they’ll use all the extra time now that school is over.

The students expressed their gratitude for the knowledge they acquired from the faculty and coaches by giving a gift and coffee mugs imprinted with one important takeaway: Without data, you’re just another person with an opinion.

With this cohort finished, the next wave revs up early next year. We’ve already written about the first on-campus week for our new health-care cohort. Check out a podcast from earlier this year where I chat with Mark Graban of LeanBlog.org for more details.

Stepping outside the COE box

Attendees of last Friday’s professional development meeting hosted by the Center for Operational Excellence can thank the executives from Cardinal Health Inc. and Starbucks Corp. for the insights they carried into the office Monday. Those of us at COE owe them gratitude for a pair of touches outside the norm for our programming that proved wildly successful.

T-shirt folding activity led by Starbucks
Seminar attendees participated in a T-shirt folding activity led by Starbucks

In the morning session, at the suggestion of lead speaker and Cardinal executive Whitney Mantonya, we devoted the entire second half of her time to a panel discussion featuring her colleagues who have helped with the Dublin company’s lean transformation. A panel on a topic featuring all employees from the same company? It isn’t something we’ve tried before and it’s not even the traditional form of a panel.  What transpired, however, was a detailed dissection of the bird’s-eye view Mantonya provided in the first half, the exact kind of sleeves-rolled-up scrutiny our knowledge-hungry members want. It seems the group’s favorite part of the morning session was the very section we didn’t originally plan.

Sometimes it doesn’t hurt to step outside the box.

That’s exactly what we did in the second half of our afternoon session as well, when we escorted the entire crowd of attendees from Pfahl Hall to the Blackwell Hotel for a hands-on T-shirt folding activity suggested and led by Starbucks that taught the basics of standard work. We’ve been hands-off with hands-on activities at our seminars before, but the overwhelmingly positive feedback (and happy faces on our Flickr page) indicate it was exactly what the doctor – err, barista ordered.

MBOE recap: The fine art of stocking shelves

When I walk into a Giant Eagle, I know exactly where I can find my favorite multigrain Cheerios. I also know a box will be waiting for me when I want it. The logistical engineering behind making that happen never occurred to me until a recent presentation by Prof. Thomas Goldsby for our MBOE industry cohort on lean logistics.

Tom Goldsby
Tom Goldsby speaks to Fisher’s MBOE industry cohort

Lean logistics and a supply chain make many processes seem like magic. Think, for example, about a company like DeBeers, exploring unknown lands, discovering diamonds, cutting and polishing them and then supplying them all over the world. Or a hospital, well-stocked with syringes, needles and oxygen cylinders. Logistics account for $1.2 trillion of the U.S. economy, or about 8 percent, meaning that for every $1 spent, nearly a dime of it goes to logistics. Of that cost, 63 percent is transportation.

So what is a supply chain? It’s the network of companies that work together to provide a product or service for the end-use market. Simply put, an apple grown in an orchard doesn’t come to grocery stores in baskets. Logistics facilitates the flow of materials and products into and beyond a facility. Lean logistics facilitates the flow by minimizing wastes.

Back to those apples: If a store stocks up on a ton because a farmer had a good season, those take up not only too much space but likely will result in waste. On the other hand, if demand spikes that doesn’t mean retailers, distribution centers and farmers should go into overdrive. Supply chain and logistics is about balancing demand, inventory and the number of trips needed. The question: Are you going to manage your supply chain, or is it going to manage you?

Next time I visit my grocery store for those Cheerios, I’ll have a completely different perspective.

How do logistics and supply chain management affect what happens in your organization?

MBOE recap: Lather them up, but shave them

In this week’s pre-graduation meeting for our MBOE industry cohort, Lawrence Inks, a guest lecturer and assistant professor of management and human resources at Fisher, shared some key thoughts on talent management. Organizations need talented people, Inks said, more than talented people need organizations. Talented people thrive anywhere, so it’s important to hunt them down and hire them but more important to retain them.  

Larry Inks
Larry Inks speaks to the soon-to-graduate MBOE industry cohort

Some tips to do just that:

We love giving positive feedback but most of us don’t do a good job communicating in general. Remember how nice it was when you receive a handwritten note from your boss? Most praise these days comes through e-mails – we’re busy and there are other priorities. Help your chances of talent retention by writing a note to your top performers.

Compliments to our best employees many times begin with the positive but insert something negative in the same line. An example: “Tom, you are an excellent facilitator but you are not good at all with data analysis.” Inks calls that the “lather them up but shave them” approach, where people are about to feel proud of their accomplishment, but in a fraction of a second their newfound motivation is killed. Talented people have no dearth of opportunities, and if they don’t feel valued they’ll leave you just as fast.

It’s important to note that feedback for underperformance is necessary, and it’s a fine art. So before giving positive or negative feedback, make sure goals are clear and the employee understands. Are they too low? It’ll be hard to hold back that 3% bonus. What the goals should be is set in a way that over-performers are easily distinguishable from average employees. In short, Inks said, a performance review should not bring surprises to either party. This is only possible if there is ongoing feedback that goes along through the year before the annual performance review is conducted.

What are some methods you use to appreciate your employees? How do you let the under-performers know that they are not at par?

COE adds staff amid growth spurt

Life brings bad problems and good problems, and the Center for Operational Excellence is happy to be right in the middle of a very, very good one.

Tom Goldsby
Tom Goldsby

To put it quite simply, we’ve grown our membership base at such a steady clip that a group once numbering four in 1992 has hit 34. This has translated not only to more people actively working with Fisher on their pursuit of operational excellence but more attendance at our quarterly professional development meetings. A lot more. Our Sept. 30 event that featured a retired Kodak executive and Harley-Davidson CEO Keith Wandell peaked at about 200 attendees, a record. This past Friday, when hosting executives from Cardinal Health Inc. and Starbucks Corp., we would have hit and potentially exceeded that record by opening the events to the public but invited members only because of space constraints. Once again, a very good problem.

In our member roster and the decision-makers who come to our programming, these aren’t just manufacturers with a shop floor. COE is embracing the notion of continuous improvement in the most inclusive way possible, paving the way for the entrance of Nationwide Mutual Insurance Co., Huntington National Bank, OSU Medical Center and others in the transactional and health-care spaces.

Not that we’re leaving our core constituency behind. We’ve come to recognize a growing contingent of members in the logistics and distribution sectors needs specialized attention. For that, we’ve brought on one of the brightest minds tackling logistics in academia today, and we didn’t have to look far. Prof. Tom Goldsby, PhD, of Fisher’s Department of Marketing and Logistics, has stepped in as an associate director for COE to work closely with several companies that will benefit greatly from his award-winning research.

Goldsby already has made his debut before our COE board. We expect you’ll see a lot more of him.

MBOE recap: Wrapping up

After three long days over last week, the final day of the MBOE session’s first week came with wrap-ups from COE Executive Director Peg Pennington, Gary Butler and yours truly. Peg went over the basics of A3 problem solving and provided an overview on DMAIC to get the students ready for the six sigma in August. I spent time teaching students the basics of future-state value-stream mapping, a topic that sparked discussion on process time, lead time and cycle time. Gary and Peg discussed the do’s and don’ts of the the student capstone projects.

COE Executive Director Peg Pennington
COE Executive Director Peg Pennington, pictured in an archived photo, spoke on the last day of the first MBOE session

I’ll close with some reflections from students ending their first week in the MBOE cohort:

“The purpose of lean is not just elimination of wastes. It also means producing twice at half the input.”

“It is making sense how a value stream map makes waste visible.”

“We hope that the value streams we created at the gembas would be helpful to the managers there.”

“Value stream mapping is not rocket science.”

MBOE recap: The first gemba

This past Friday, students in Fisher’s MBOE program got a real-world lesson on the word gemba with visits to Ohio State University Medical Center and Tosoh Corp.

OSU Medical Center, gemba
MBOE students observe at OSU Medical Center.

At the medical center, Dr. Susan Moffatt Bruce and her team welcomed students, who got up-close access to areas including labor and delivery, chemotherapy infusion and the invasive preparation and recovery area, a 23-bed unit that serves OSU’s Ross Heart Hospital. Each group was chartered with creating value stream map for the processes they observed, an hours-long process that resulted in a few common themes: Variation in process, a gap in understanding of the full value stream among frontline members and not enough communication among team members.

The efficiency of health care took on a new urgency when a patient, Michele, and Dr. Daniel Eiferman spoke. Speaking of her father’s six-year journey with cancer treatment, Michele said: “Please don’t assume that patients know the condition of their illness or the next steps. Also, please listen to what the patient or their family member is trying to say.”  Dr. Eiferman said because he wants to use as much of his time to help patients, “the inefficiencies in the processes keep me away from adding value to my patients.”

Students said they wanted to make sure that their findings were helpful to the managers who let their staff dedicate half their day to spend with the students. High praise on the results came from none other than Dr. Charles Lockwood, dean of the medical school, who said it was important to understand the constraints that people work with to do their jobs and eliminate those constraints whenever possible to improve inefficiencies.

MBOE recap: Airplanes are not cars

Barb Bouche, an MBOE coach and director of process improvement at Seattle Children’s Hospital, told students at this week’s session that she began exploring the option of applying Toyota Production principles to the hospital a few years ago. She met with resistance from the organization, the argument being, “Patients are not cars.” Shortly afterwards she happened to cross paths with some people from Boeing. They told her during their lean journey the argument they commonly heard was, “Airplanes are not cars!”

MBOE students strategizing production game plan
MBOE students strategizing production game plan

It didn’t take Barb long to realize that argument arose from a resistance to change. In last decade Seattle Children’s has completely changed how it do esbusiness by applying lean principles. Officials have significantly reduced the inventory of supplies by working closely with their suppliers and developed a world class process for materials management.

Speaking of airplanes, the MBOE students spent their second day on campus manufacturing StrikeFighters using Legos.  After struggling through the first and second round of the chaotic batching process they finally were able to create flow using the lean principles of takt time, work cell, one piece flow, level loading, kanban and simplification. My co-author, Matt Burns, wrote about this same simulation in an earlier post.

A student commented, “I think I am just beginning to see what lean is all about!” Another said, “I did not know what I was doing in the first round. The last round made it very clear after all the chaos was gone and there was finally some coordination and flow among my team members.”

In the evening, Capt. Michael H. Glazer, commanding officer and professor of naval science at OSU’s Naval ROTC  gave a captivating overview of flight deck operations and aircraft carrier facts. With multiple safety programs, Glazer said, the naval aviation mishaps decreased from 776 aircrafts in 1954 to 39 in 1996. Keep in mind naval aviator trainees are landing the aircraft on a short run of only 330 feet.

Another long day for the students!