Greetings!

We hope you enjoy this month's edition of our operational excellence newsletter. Please take a few minutes to read the Leading With Lean article which demonstrates how an oil company, Hess, through Lean manufacturing processes, is continuing to increase efficiency and in turn bring down drilling costs in the Bakken.

Quantum Associates, Inc

Operational Excellence Newsletter 
  

 Delivering Swift and Significant Results 


 "
Our groove is to help you improve."

  


February 2016

Understanding Lean's Potential
 
 

A few days ago I was reading an article in ASQ's Quality Progress about how a cellular phone call center applied Lean to reduce its average call handling time by 30 seconds resulting in a savings of $2.5 million a year. As this company discovered "every second counts."
 
Sometimes organizations lose sight of the potential of Lean because they disregard what they deem as the insignificant time losses. Let's say you have a group of administrative employees wasting 1 minute per transaction in non-value added activities and you complete 1000 transactions a day; that is equivalent to 1000 minutes/day times 250 work days or 250,000 minutes per year which is approximately 4000 hours or 2 FTEs (full time equivalents). That is hardly insignificant.
 
It is estimated that at least 40% of operations expenses in service fulfillment processes like call centers or financial institutions result from wasteful activities that add no value to the customer and therefore should be eliminated. The majority of these wasteful activities are causes by increasingly complex service fulfillment processes that contain multiple handoffs and decision points. Work is more difficult to track and less tangible in a service environment, making hidden waste more prevalent. Furthermore, business stakeholders define waste differently, resulting in organizations not measuring waste uniformly across the organization.
 
Lean institutions identify much more cost reduction opportunity than non-Lean adopters by eliminating non-value-added activities resulting in higher efficiencies and lower costs. Lean empowers you and your staff to continuously challenge the status quo to redefine value in the eyes of the customers. Rather than asking, "How do I do this better?", Lean organizations ask, "Why do I do this at all?" revealing wasteful activities that should be removed to reduce cost and improve service.
 
Finally, unlike other process improvement methodologies such as Six Sigma, Lean programs do not require significant up-front capital investments or certification. Lean concepts are easy to apply because they are "applied common sense." In addition, some service organizations leveraging Lean techniques report immediate results of 20% to 40% cost reduction in 12 to 18 months. For example, the call center I mentioned earlier was able to achieve the 30 second reduction (from 150 seconds to 120 seconds) in call handling time in 3 months.
 
So the next time you are observing one of your service processes don't disregard those seemingly insignificant time losses. Analyze what they are truly costing you in terms of lost time and money, then apply some common sense Lean tools to improve the process and realize the potential cost reductions and greater efficiencies.
 

Willie
"Our groove is to help you improve"
In This Issue
Beyond the Shop Floor-Three Ways to Create a Lean Back Office
Leading With Lean
Start Lean Journey by Planning the Trip
Porcess Excellence Makes Sales Problems Solvable
Beyond the Shop Floor-Three Ways to Create a Lean Back Office
 Contributor:Daniel Griffin
 
The path from idea to invoice is long and can take a bite out of margins if not optimized; 60-80 percent of all costs related to completing a customer order are administrative based. A manufacturing operation encompasses administrative tasks, sales, marketing, IT, CRM, engineering, product development and other "behind the scenes" activities that don't necessarily take place on the shop floor, but directly impact the bottom line. (Read More)
Leading With Lean
Contributor:Jennifer Presley
"My hope is that is that the industry uses this downturn as a means to really focus on the inefficiencies that have been built into this business as a result of a rapid upturn caused by the U.S. onshore," he said. "There was a lot of inefficiency that crept into the system. Lean is one way to address it. It is the way Hess is doing it because it works extremely well." (Read More)

Start Lean Journey by Planning the Trip
 Contributor: Beau Groover
When I speak with people about lean programs, I am often asked, "Where should we start?" While this sounds like a very simple question, it actually requires a lot of thought. However, the simple answer is that you must first decide where you want to go before you know where you should start. Think of it like this: If you don't know where you want to go, it really doesn't matter if you have a map. (Read More)
Process Excellence Makes Sales Problems Solvable
Contributor: Michael Webb

No company has much direct control over the demand curve among its customers. However, by defining your terms, gathering data, and aligning the work to real customer value (the fundamentals of process excellence), you can remove the waste and misalignments that hamper conversion and productivity in your business. You can pick up information that will allow you to shift your resources to where customers need it. (Read More)

Quantum Process Improvement TM (QPI)
 
Move your company into the "Profit Zone" with our quantum process improvement (QPI) model. QPI Integrates the three most powerful process improvement disciplines-Lean, Six Sigma and the Theory of Constraints to move your company into the area where sustainable, superior profit happens creating enormous value for you and your stakeholders.
Leading your company into the "Profit Zone" requires improving the performance of your critical operations and administrative processes. We use our QPI Assessment to focus on the process areas with the greatest potential for generating results within two to three quarters.
If the goal for your business is to create superior long-term profits-not average profit, not cyclically inflated profit, not short-term profit then contact us today to learn more about how our Quantum Process Improvement TM model can work for you.
We guarantee 100% customer satisfaction absolutely.
 
"Our groove is to help you improve."

 
For more information contact us today at 847-919-6127 or email [email protected].

Enjoy the Newsletter, 
Willie
Willie Carter
President 
Certified Lean Sensei
Certifed Manager of Quality/Organizational Excellence
Certified ISO 9000 Lead Assessor
 
 
"All improvement happens project by project and in no other way." ~ Joseph Juran

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