LEAN

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LEAN
Rex Davis Vice President of Supply Chain for IBT
Inc.
The Lean Six Sigma Distributor
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THINK LEAN!!!
Who currently practices LEAN???
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Who takes the shortest route home?
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THINK LEAN!!!
You are already THINKING LEAN!!!
Lets learn how we bring it to work!!!
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BOILED FROG

• If you put a frog into a
• pot of boiling water,
• it will leap out right away
• to escape the danger.

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BOILED FROG

• But, if you put a frog in a pot that is filled
• with water that is cool and pleasant,
• and then you gradually heat the pot
• until it starts boiling,
• the frog will NOT become aware of the
• threat until it is too late.

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BOILED FROG

• The frog will be
• boiled ALIVE!!!

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LEAN ??? You be the Judge!

• We dont have to CHANGE,
• survival is not mandatory.
• Dr. W. Edwards Deming

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LEAN Six Sigma What is it?

• LEAN and Six Sigma are both process improvement
  methodologies
• LEAN is about speed and efficiency
• Six Sigma is about precision and accuracy-
  leading to data-driven decisions

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Methodology Analogy
Lean Six Sigma
Six Sigma
LEAN
Kaizen
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Lets Dig deeper into LEAN!!!
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Misperceptions about LEAN

• Its a factory thing
• It wont work here
• We tried that
• Its all about one-piece flow
• 5-S is cleaning up your desk
• We are different
• Zero Inventory

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Industries Deploying Lean in the Office
Environment

• Advertising
• Banking
• Computer services outsourcing
• Document management
• Energy services
• Field technical services
• Financial services
• Telecommunications
• Construction

• Hotels hospitality
• Insurance
• Logistics and distribution services 
• Professional services
• Sales marketing
• Transportation
• Manufacturing
• Healthcare
• Transactional processes in manufacturing

• and even our on Government

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Little LEAN History

• Henry Ford

Pioneered the concept of an assembly line with
synchronized and standardized operations. Iron
ore in barge on Monday morning to completed Model
T on Tuesday afternoon

• Toyota

Camry every 57 seconds

• Harley Davidson

Assembly process 45 Minutes
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LEAN Industries

• Military/Aerospace

Reduce aircraft turn around time cost

• Medical

Reduce processing timeeliminate waste

• Financial

Customer focused processes faster, higher
quality, lower cost
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LEAN

• Principles and techniques used by Lean companies
  are
• Proven
• Effective
• Efficient
• Powerful

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Goals of LEAN

• 1. Eliminate Waste
• Waste is any activity that takes up time,
  resources or space but does not add value to a
  product or service.
• 2. Improve Quality
• Your products and services conform to your
  customers wants and needs.

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Goals of LEAN

• Reduce Lead Time (SPEED)
• Lead time is the total time it takes to complete
  a series of tasks within a process.
• Reasonable Price (Competitive Price)
• Does not mean cost cuttingmeans cost
  management. Improving quality and productivity,
  reducing inventory and lead time will reduce
  total cost.

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Seven 1 Types of Waste
1. Over-production
2. Transportation
4. Excess Motion

• Inventory

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Seven 1 Types of Waste
6. Over-processing
5. Defects/Rework
1. Underutilized People
7. Waiting
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Typical Office Wastes

• Lack of standard work between departments
• Irrelevant meetings
• Making multiple copies
• Approval for things you are not involved in
• Inspecting others work
• Inter-office snail mail

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Eliminate Waste
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Goals of LEAN

• 2. Improve Quality

Simple Make what your CUSTOMER wants!!!
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Goals of LEAN

• Reduce Lead Time (SPEED)

Simple Deliver your products to your CUSTOMER
when THEY want it!!!
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Goals of LEAN

• Reasonable Price (Competitive price)
• Simple Sell your product for a reasonable
  price, that is competitive in the market place
  and is ACCEPTABLE by YOUR CUSTOMER

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LEAN is...SIMPLE
GIVING YOUR CUSTOMERS

• exactly what they need
• when they need it
• in the quantity they need
• without defects
• and at THEIR acceptable price

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• LEAN,
• competitive advantage
• or
• NECESSITY???

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Customers Perceptions
Customer Perceptions
Late Delivery
Too much Inventory
Long Leadtimes
Not Price Competitive
No warehouse space
Can't meet demand
Projects Never Complete On-time
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Market Realities of Today?

• Mature industry
• Intense competition
• Capacity exceeds demand
• Price sensitive
• Interconnected world (world is flat)
• Customers demand more for less
• Customers demand faster response

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• Each of OUR customers CHOOSE who they buy
  from!!!

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What is it that CUSTOMERS do NOT like???
Youre a customer!!! What dont YOU like???
HOLD MUSIC
DEFECTIVE PRODUCT
RUDENESS
UNORGANIZED
WAIT TIME
HIGH PRICING
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What are CUSTOMERS looking for???
VALUE
DEALS
FRIENDLY SERVICE
SMILE
QUALITY
QUICK RESPONSE
LISTEN
KNOWLEDGE
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are the
ONLY ones paying for your companys product and
services!!!
What makes your company valuable to your
customers???
CUSTOMERS
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The Challenge of LEAN

• Dr. W. Edwards Deming states that
• problems are in the process,
• not the person
• 85 of problems were built into
• the way we work.
• To make a profit we must
• improve our process efficiencies
• (quality and speed)

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CUSTOMER NEEDS

• DOES your company currently have these three
  requirements
• SPEED
• QUALITY
• RIGHT PRICE

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LEAN ??? You be the Judge!

• We dont have to CHANGE,
• survival is not mandatory.
• Dr. W. Edwards Deming

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LEAN Six Sigma requires Behavioral Change

• LEAN Six Sigma challenges Us to
• Think differently
• Work differently
• Ask questions and challenge the status quo
• Make decisions with facts and data

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Cultural Aspects of Becoming Lean

• Lean transformation requires everyone to change
• It impacts all levels of the organization
• The change will be traumatic
• Lean changes how people work and think
• People are at the center of the system

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Common Obstacles Encountered

• People resisting change, will
• Attack the methodology
• Attack the people introducing it
• Make excuses
• Support it in public, but work against it in
  private
• Maintain status-quo hoping change will go away

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Obstacles Typically Encountered

• Functional Silos
• Operate independently
• Are internally focused
• Have difficulty working together
• Focus on their own improvements disregarding
  customer delivery

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Planning to Overcoming the Obstacles

• Plan for a resistance to change
• CEO visibly and support drives the effort
• Mandate participation in LEAN
• Involve ALL the Senior Staff
• Identify projects with smaller scopes
• Empower people to change

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Companies that have developed processes that can
do more and more with less and less---
effort, equipment, time, and space---
while coming closer closer to providing
customers with exactly what they want, when they
want it
LEAN companies are taking YOUR CUSTOMERS ONE SALE
at a TIME!!!
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Jump or Boil??? Its YOUR CHOICE!!!

• Will you be a FROG that is leaping ahead of your
  competition?
• Or will you be left behind in the pot waiting
  to be BOILED?

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LEAN ??? You be the Judge!

• When the rate of change
• on the outside of your
• organization is greater than
• the rate of change on the
• inside, the end is in sight.
• Jack Welch

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IBT continues to leap AHEAD of our competition!!

• The LEAN Six Sigma Distributor
• www.ibtinc.com

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• THANKS!!!

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Get to know IBT and you will understandwhy we
have been one of AmericasLeading Distributors
since 1949.
The LEAN Six Sigma Distributor
rdavis_at_ibtinc.com

• www.ibtinc.com