Implementing NonManufacturing Lean: One Company's Experience

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• Implementing Non-Manufacturing Lean One
  Company's Experience

Presented by Tim Bloudek Quality Manager March
2, 2006
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About Braas Company

• Distributor of products and solutions for
  Industrial Automation
• 100 employee owned 75 by an ESOP trust and
  25 by individual employees
• Approximately 100 employees
• Offices in MN, WI, FL, IA, NE, IL

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Why Lean Administration?

• Good is the enemy of great Jim Collins Good
  to Great
• Desire for better customer service
• Desire for improved financial performance
• Waste is prevalent and must be minimized
• Many lean tools available applicable

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First Steps Along the Lean Journey at Braas

• Top Mgmt Commitment Nov 2003
• Consultant Selection- July 2004
• Introduced Kaizen Events Oct 2004
• Introduced 6S Mar 2005
• Began Policy Deployment July 2005
• Introducing HPS Nov 2005

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Top Management Commitment

• Vision began with example from a supplier (2003)
• Previous CEO helped us create our vision and
  begin our journey (2004)
• Current CEO and management team are committed to
  the journey
• Requires a cultural change across the organization

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ConsultantsChallenges

• Not many consultants with Lean office experience
• Matching Consultant personality with Company
  culture
• Flexibility of the consultant
• Cost

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ConsultantsBenefits

• Experienced trainer and mentor
• Event leader/facilitator
• Broad range of experiences
• Challenges our current thinking
• Management coach for Lean transformation
• Task Master

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Kaizen Events - Challenges

• Opportunities abound but may be difficult to
  identify
• Kaizen events tend to be complex - Simpler
  projects yield minimal results (CI)
• Baseline data may not exist
• Establishing measurable goals not easy

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Kaizen Events - Challenges

• Concurrent team facilitation and team
  participation
• Mentally exhausting
• Only a small number of employees share the
  experience and learning
• Sustaining results

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Kaizen events - Benefits

• Generally cross functional in nature
• First hand learning opportunity
• Value Stream Map
• Swim Lane Diagram
• Process Flow Diagram
• Kaizen Newspaper
• Plus / Delta

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Swim Lane Map
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Kaizen Newspaper
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Plus / Delta

• Daily wrap up during the Kaizen event
• What went right?
• What needs to be changed or improved upon?
• Anything is ok to mention

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Kaizen events - Benefits

• Excellent team building experience
• Strong sense of accomplishment
• Potentially powerful results

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Kaizen Events Tackled

• On Time Delivery
• Customer Account Holds
• New Employee Orientation Training
• CRM Design Criteria

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Event results

• Implemented an on time delivery metric with
  current accuracy of 76 (OTD)
• Increased one touch order entry from 70 to a
  sustained 87 (On Hold)
• Implemented a pre hire and post hire process for
  customer service
• Developed a CRM design specification

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Lessons learned

• We CAN work together for 5 straight days and
  nobody left!
• There is a lot of knowledge within Braas that
  when focused on an issue can yield great results.
• Its OK and even good to fail early (and often).
• What seems easy and simple on the surface isnt
  always that easy and simple.

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Lessons learned cont.

• Consistency of process, definition of terms and
  follow up is critical.
• Kaizen events can help knock down walls between
  departments.
• Sustaining gains takes a lot of effort and energy.

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6S Early Results

• Recycled 8 skids of old IT stuff plus donated
  26 monitors office supplies to schools
• Application engineering removed 5 file cabinets,
  two book cases and other miscellaneous of stuff
• Work areas more organized and functional
• Better record retention schedule need surfaced
• Good start

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OK, So Now What?

• Kaizen events were interesting and worthwhile but
  how do we decide what to do next?
• 6S has some benefits but how do we decide what is
  really important to the organization?
• What can we do to steer the culture toward
  improvements?

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Policy Deployment

• Aligning and focusing our efforts to execute our
  strategy and achieve our vision.

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Terminology

• Vision - Where are we going? What do we want to
  be? Can you see where we want to be in the
  future? (10 20 years)
• Strategy What is the high level view for how
  we are going to achieve our vision? (5 10
  years)
• Initiatives Where will we focus our efforts and
  limited resources? (1 3 years)

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Terminology cont.

• Goals Objectives What are the tangible and
  actionable items that reflect the business
  strategy? (1 year)

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Braas Company Vision

• We will be a global supplier of world-class
  automation solutions

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Braas Company Strategies

• Improve Sales Effectiveness
• Seek Products and Suppliers for Long-term Growth
• Grow High Value Services
• Geographic Expansion

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Braas Company Initiatives

• Meet revenue budget goals
• Improve GM rate
• Continued expansion of Lean
• Implementation of CRM tool

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Braas Company Objectives

• Achieve an annual operating income of X
• Invest in Braas for long-term financial stability
  and health

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Braas Company Goals

• Achieve sales revenue of X for FY06
• Achieve overall GM of Y for FY06
• Achieve effective implementation of PD by end of
  FY06
• Fully operational CRM by end of FY06

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Policy Deployment Matrix
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Initiative Tracking Reporting
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Policy Deployment

• Focuses the organization and its resources on the
  critical few initiatives
• Provides a method for de-selecting non critical
  activities
• Ensures everyone is working toward the same ends
• Minimizes wasteful use of scarce resources

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High Performance Supervision

• Involves supervisors and other functional area
  leaders and their staff
• Identifies key metrics for each area
• Creates a link from the strategic plan and PD
  initiatives to front line activities
• Helps drives improvement actions to all levels of
  the organization

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Wrap up

• Lots of tools available
• Value stream mapping
• Kaizen events
• 6S
• Standard work
• Six sigma
• Policy deployment and HPS are methods that use
  the various tools

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• Our rate of improvement must increase for us to
  prosper
• Our world is different today and will be
  different again tomorrow
• Improvement must be methodical and transferable
• Technology can be an enabler or destroyer of
  growth or improvement it not a silver bullet
• Continuous improvement is a process not a project
• Continuous improvement will be our competitive
  advantage

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Conclusions

• A Lean way of life is essential for our success
• A Lean transformation requires a cultural
  adjustment
• Lean administration is a new frontier worth
  exploring
• Lean is a journey we must embrace to thrive

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Contact Information

• Tim Bloudek
• 7970 Wallace Rd
• Eden Prairie, MN 55344
• 952-937-6566 direct phone
• 952-949-6061 direct fax
• timb_at_Braasco.com email
• www.braasco.com website
• Tbloudek SKYPE number