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21st Edition 

February  2013

In This Issue
Human Resources' Role in Developing a Lean Culture
Lean - Simply Easy to Do

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Human Resources' Role

in Developing

a Lean Culture

 

By Larry Rubrich 
 

One of the topics in Edition#13 of our newsletter was "The Four Components of a Successful Lean Construction Implementation."

 

Lean Culture  
 The For Components of Lean

 

We discussed the following elements that are required in developing a Lean Culture: 

  • Leadership
  • Communication
  • Empowerment
  • Teamwork 

In this edition, we will define the Lean culture-building activities that the Human Resources (HR) area should be involved in.

 

A wise corporate president once said it was okay to make mistakes as long as you learn from them and do not repeat them in the future. But he also went on to say that there are two mistakes managers or leaders could make that are difficult to recover from; they are decisions about capital investments and people. People are any organization's most important asset and the key to their success.

 

Unfortunately, most organizations do not fully utilize HR in the company's culture-building activities. The company culture is left adrift to develop on its own and Human Resources is relegated to hiring, firing, and keeping us legal. Have you ever seen any Certified Lean Facilitators that have come from HR?

 

In Lean, the HR area plays an extremely vital role in establishing Lean as the way we run our business and how we do our work. HR closes the feedback loop on the people side between the strategy, culture, and the plan we say we are deploying, and the actual deployment.

 

An important part of this loop closure includes integrating Lean measures (which is both the support and participation in Lean activities, and the adherence to the cultural framework of behavioral expectations) into the following traditional HR areas of:

 

* Performance appraisals

* Candidates for promotion

* Merit increases

* Hiring recommendations

* New employee training

* Bonus incentives

 

The first time the organization promotes or publicly rewards someone that is less than a 100% supporter of our Lean activities, it sends a messages to the organization that effectively dooms the Lean deployment.

 

Defining a company's behavioral expectations provides a framework for the Lean Culture and adds an aspect of "how" people do their jobs.

 

Behavioral expectations or codes of conduct are short statements, usually in the form of a laminated pocket card, that are "a set of rules or standards" that members of the organization use to guide their behavior and actions. 

 

Code of Conduct Only

 

Behavioral expectations will only produce culture change if they are modeled by the Leadership Team. Since the culture change process can take years, the Leadership Team must be committed to the guidelines as a new way of doing business.

 

Behavioral expectations add a new dimension to individual or team performance evaluations which typically only measure performance --"What we do." The typical performance review is one dimensional performance only as shown on the chart below. Within this one dimensional evaluation there are levels of unacceptability and acceptability.

 

 Behavioral Expectations  

In this one dimensional measure, we can confusingly lump together two different types of performers, acceptable and higher performers. The individual who is getting acceptable performance using communication, empowerment, and teamwork within their work group, and the person who is getting acceptable performance using fear, intimidation, and a command and control style of management in their work group. Only when the culture measure of "How we do our work" is added to the evaluation does the separation in types of performers occur as shown below.  

 

What Kind of Leaders    

The above figure then represents the four types of people that comprise an organization.

 

By quadrant these types are:

  • In the lower left quadrant are those people whose performance is unacceptable and who will never fit into the Lean culture that is being created. These people should not be a part of the organization.  
  • In the upper right quadrant are the high potential people--the people the company can be built upon. However, where does H.R. tend to spend the most time? Most organizations spend most of their time dealing with the problem people in the lower left quadrant, when they should be spending time developing high potential people. If we do not spend time developing our good people they will leave. They will become disenchanted and find more rewarding work elsewhere.
  • In the upper left quadrant are those people who have the heart and desire to fit into the Lean culture but whose performance is still unacceptable. Work with these people. They may be in the wrong job, lack training, are uninspired, etc. Help them into the upper right quadrant. We want all of our people to be in the upper right quadrant. We want people who fit into the new Lean culture and are achieving the results necessary to support the business objectives of the organization.
  • In the lower right quadrant is the person (as described above) who is getting acceptable performance using fear, intimidation, and a command and control style of management in their work group. The question becomes can they adopt the habits of the new culture and leave the old habits behind? Again, the goal is for everyone to be in the upper right quadrant. On page 112 in the book, Leading Change, noted organizational change expert John Kotter addresses this type of employee and provides strategies for handling this situation.

Additional Human Resources' Lean responsibilities include monitoring and testing for the completeness of the communication and empowerment plan. Measuring communication effectiveness means testing using activities such as:

  • Management By Walking Around (MBWA) - randomly asking associates what, when, how, and why questions about goals and strategies that have been communicated.
  • Monitoring the amount of rumors in the organization. Rumors have only one reason to exist in an organization - to fill in gaps in communication.
  • The types of questions during the Q & A section at the required monthly "all-hands" company meetings--are people asking questions they should already know the answers to?
  • Are all business areas visually communicating with the rest of the company? Can a person tell what is going on in the organization from the visual communication?

Part of the evaluation of the completeness of both the communication and empowerment plan should rely on the use of surveys performed by outside companies.

  

Reference:

Kotter, J. (1996) Leading Change. Boston, MA: Harvard Business Review Press 

Lean - Simply Easy to Do

 

By Dennis Sowards

 

 

Masaaki Imai, Lean guru and author of Kaizen & Gemba Kaizen, likes to say, "If you are spending lots of capital to do Lean - you are not doing Lean."

 

Many contractors, who are trying Lean in construction, are not really doing Lean by this definition. They are spending big bucks on BIM and calling it Lean. Not that using BIM is wrong, in fact, it has great value when applied correctly. But BIM is not Lean and does take a large investment to get set up, train personnel and to learn how to apply.

 

Lean is a simple, common sense approach, though often not a common practice. Consider the following examples of applying Lean

 

Poke Yoke

 

Henry Ford would say, "Make it can't, Not don't." Poke Yoke means to error proof work so one cannot make a mistake. One example of this in construction, is marking duct with a grease pen showing exactly which end connects with which end. This may not prevent a mistake but greatly helps to prevent it.

 

Simple, Visual Boards

 

When workers know the goals and work assignments each day, they usually are able to do a better job. Some contractors feel they need to install electronic signboards to display the daily and weekly work plans. The simple Lean approach is to use a white board with markers. It is not high-tech but works well and is much less expensive. It also sends a message to the workers to use simple solutions not expensive ones.

 

Spaghetti charts

 

A Lean way to understand the path material or information takes, is to do a spaghetti chart. Using a map of the work area, one walks and marks the actual path of fabrication (shop), material installation (from the yard lay-down area to install) or purchase order processing (office). The Lean principle is to "Go and See," and the spaghetti chart allows simple and useful documentation.

 

Rules of Release

 

Work-arounds are all too common in construction. One Lean tool to help address this is to get both the giver (supplier) and receiver (next in line customer) together and identify the rules (requirements) for releasing or handing off work to the receiver. Both parties collaborate to define in detail what must be done or be ready to release work. Identifying and agreeing on the hand-off requirements is not hi-tech but can be very effective in creating workflow and eliminating rework or work-arounds.

 

Kanbans

 

Some contractors are investing big dollars in material management systems, including bar codes and scanning devices. From a Lean standpoint, we want to ensure that the shop fabricators and the install crews never run out of the material they need to add value. A simpler Lean tool is the Kanban approach. Refill levels are marked visually and a card containing the reorder information sends the signal when it is time to refill. When used consistently, Kanbans can eliminate workers waiting for material and keep the amount in inventory to a reasonable level. The bar coding approach often fails when workers do not remember to bar code every item used, causing the inventory levels to read higher than reality. The Kanban visual approach does a better job of signaling when to reorder, and for a lot less time and capital.

 

Look-Ahead Planning

 

Most contractors use project management tools such as Primavera to schedule their work. They invest many hours in entering and updating the schedule. Some level of a master schedule is useful, but a hand completed six-weeks look-ahead check list is much more effective in making sure the work tasks are ready to be done when scheduled. The electronic schedules focus on "time" (which week) as the change variable, while the look-ahead plan focuses on making work ready.

 

5S's

 

Mr. Imai also says, "If one is not doing the 5S's one is not doing Lean." The 5S's are a valuable Lean tool to reduce or eliminate treasure hunting so common in construction. By moving tools and needed equipment close to where the work is being done, the waste of movement is attacked. One example is using duct tape to mark where finished fabricated product for each job should be placed on the shop floor. As jobs change and the quantity of fabricated product for that job changes, the tape can easily be adjusted to suit. On job sites, workers often reuse cardboard boxes to hold material. A grease pen can be used to mark on each box its actual content, thus avoiding a treasure hunt of workers looking in each box.

 

Productivity

 

As an industrial engineer, I am always interested in how contractors measure productivity. I have yet to find real useful measures being employed. Managers fool themselves thinking that such measures as feet of pipe installed per hour or tons of steel erected per day really measure crew productivity. The best measure I have found is PPC - Percent of Planned (work) Completed. While this is not a true productivity measure, it is a more useful one. It measures the effectiveness of the planning system which includes the foreman, superintendent, crews, PM and even the GC and other trades. It is a simple measure to understand and track. Research shows that crews, not doing Lean, only do about 54% of the work they planned to do each week. Using PPC as an indicator and implementing Lean planning techniques can raise PPC into the 70 - 80% range. (If it reaches 100% and stays there, then someone is gaming the system. But that is another article.) It is logical and proven that when crews do more of the work they planned each week they are more productive.

 

One straight line

 

One story from a manufacturing shop illustrates the whole idea of simple Lean. A company had a large machine that had over 200 bolts holding it together. Each Friday a worker had to check each bolt to make sure it had not vibrated loose. This was time-consuming, tedious work because the worker had to put a wrench on each bolt to try and tighten it. One worker suggested that after each bolt was tightened to draw one straight line from the bolt to the flat surface it was touching. The next week the worker could visually see if the bolt needed tightened by how well the line on the bold lined up with the line on the surface. This made the weekly job faster and easier. Where would one straight line simplify your work? (Story courtesy of Norman Bodek.)

 

There are many ways to make work more efficient without spending scarce capital funds. Lean is simple ideas applied to eliminate waste--make it a common practice.

 

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This Lean newsletter is the result of the collaboration of three organizations:
  
Grunau Company
Ted Angelo, Executive Vice President

Quality Support Services, Inc.
Dennis Sowards, President
dennis@YourQSS.com

 

WCM Associates LLC
Larry Rubrich, President

 

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