Lean tools can be incredible assets to a business. They’re usually fairly simple to understand and can produce some outstanding results. Unfortunately, many Lean tools get used without consideration for what truly brings value to the customer or the broader business strategy. As a result, tools are applied toward short-sighted gains and the true commitment level to sustainment is low. This article lists the first 3 of the top 10 most misunderstood but commonly applied Lean and Continuous Improvement tools.
1) First on the list is 5S (or 6S if you include safety). The 5 S’s stand for sort, set in order, shine, standardize, and sustain. This acronym was originally developed in Japanese, which also used 5 S’s, which you can learn more about here – 5S on Wikipedia.
The misunderstanding: Most people understand 5S to be a good way to organize the workplace so it looks and feels good. 5S is a great way to remove clutter and define a home for each and every item. If you’re really doing it right, 5S also serves to thoroughly clean equipment inside and out and identify defects that need repair. Some even go into 5S expecting an immediate boost in productivity, morale, and some other key metrics. While 5S does enable these and other great results, it’s not the fundamental intent of the methodology as designed.
Why do 5S? The true purpose of 5S is to expose opportunities for improvement – both from a people and process development standpoint. Many leaders expect an immediate ROI after a 5S implementation, but what this method really does is lays the workplace conditions needed to begin the journey of Continuous Improvement – and not the journey itself. For example, during 5S, you must establish a home for each and every item. When an item is found to be out of place, it exposes an opportunity for coaching and possibly process improvement. Leaders and process owners should be asking why the misplaced item so easily wanders from its home? Perhaps its home is not set up in the ideal place. Perhaps there aren’t enough of this particular item in supply for each area and people from other areas keep taking them away. There could be a million reasons, but in observing the process and asking why things are out of compliance, helps drive overall process improvement and people capability development.
2) Overall Equipment Effectiveness (OEE) – This is a metric used to calculate equipment utilization and categorize losses. The metric measures a factory against perfection – meaning 0 losses, which is theoretically impossible, so you should never ever ever see 100% OEE.
The misunderstanding: Many use OEE to show how good their processes are. Some set a target for OEE, even as high as 85%, which is widely regarded as world-class, then expect their teams to show 85% as quickly as possible. Some even go as far as to reprimand or punish their teams for not showing a high enough OEE. Many seek ways to trim out some losses so they can show a higher number such as giving start-up and changeover allowances because these losses are considered “unavoidable”. Another example would be to not consider losses due to supplier or raw material issues because these losses are “out of our control”.
Why use OEE? The real value in OEE is in showcasing your losses and using the information as an input to where you can drive the greatest improvements. The reason OEE compares your process to perfection, or Zero Losses, is because true process perfection is the ultimate objective, although realistically unachievable, and thus is why we call it Continuous Improvement – because it never ends. Implementing OEE is not the end of the journey, its done in the beginning. The journey is in the improvement work done to capture OEE gains, which happens over a long time period – years even. In the process, leaders should be developing the capability within their people to understand OEE losses and lead process improvements. Only when the people capability is developed can sustainable gains be achieved.
3) Kaizen. In most Lean circles, Kaizen is synonymous with Continuous Improvement. It actually stems from the words Kai, for change, and Zen, meaning “good” in Japanese. The literal translation to English is Change for the Good. Change itself is inevitable. The objective of Kaizen is to ensure that things are changing for the better. Organizations should be constantly improving to get or stay in tune with the market.
The misunderstanding: Kaizen is often used to generate some quick business results. Perhaps this means a cost savings or bump in productivity. The expectation is that once the Kaizen event is done, you should be able to continue normal operations and achieve better numbers. It’s also an expectation that the area that was improved was done in isolation of all of the many interconnected parts of the organization such as other production areas, support functions, the customer, sales, logistics, etc. Even the people are expected to be trained on the new process and run out and start generating much better results.
Why do Kaizen? The world within and around your business is constantly changing. In order to stay viable or grow, your business has to change as well. Kaizen describes an approach for making these changes. Kaizen not only helps to continuously engineer a more perfect process, it also helps to build the capability within your people to improve. In other words, it transforms every process owner into somewhat of an engineer, capable of self development, decision-making, and process improvement. The key to making Kazien work is for leaders to focus on building people capability, who in turn, perfect the process. Another critical ingredient is to make sure improvements are aligned to the company strategy. This helps ensure that improvement effort isn’t randomly applied, consuming precious company resources, but instead are working to take the business in the right direction.
By now, you can probably see the pattern in how Lean tools are misunderstood. Many times, the expectation is quick results with a relatively low level of leadership commitment. However, for these tools to drive long term sustainable growth, you need high leadership engagement and a clear strategy. At the heart of your business are your people. Your business results are largely a result of their capability, which is largely the result of your investment in them as their leader.