Lean manufacturing

E&T looks at whole system lean transformations.

Lean manufacturing at its best leads to a total reshaping of the purpose, systems and culture of an organisation. There is a fundamental transformation, and the benefits are measured in two-fold and three-fold improvements, not in mere percentage points. However the challenge is to achieve what can be called whole systems transformations for specific manufacturing businesses given their unique circumstances, and with their different processes, structures and rhythms.

It is immediately apparent simply by walking into a factory when a whole systems transformation has been achieved. It can be seen and felt. The place is tidy, the processes efficient, there are no piles of work-in-progress, and the people are empowered and have a renewed purpose and culture. There is simply a buzz in the air. Why does this not happen every time, given lean’s impressive range of tools?

One reason is that lean does not apply fully to every manufacturing organisation. This is especially so in those enterprises operating outside of lean’s original home ground of automotive, electronics and consumer goods. In areas like pharmaceuticals, chemicals, aerospace, defence, process industry, food, capital goods and engineering projects the tool set is a partial fit and its logic is stretched. Many companies find it difficult to apply the full set of principles and tools, and the amount they can do is not enough to trigger a whole systems transformation.

In others, the enthusiasm of external consultants and management for quick cost-savings has led organisations to apply lean in a piecemeal, tool-based way. The aim becomes ‘doing lean’ rather than creating the paradigm shift. This is a false economy, choosing quick wins this year over embarking on a more difficult journey to secure the long-term.

It is clear when a whole systems’ transformation has not occurred. You will have experienced walking into a factory and finding that there is still something tantalisingly missing. The whole thing is like an un-tuned engine. The teams themselves work well enough, but the people do not express much job satisfaction or confidence. There has not been a radical change in purpose and culture. The benefits are patchy and unreliable, and no one believes that, if you put your foot on the pedal, this vehicle would accelerate smoothly away!

Patchy or Whole Transformation?

Lean’s original cultural origins from the East assumed an holistic view of being a manufacturing organisation. Simon Thane, director of Tricordant, says. “Process streamlining, reducing changeover times, quality control, process capability, kanban and smoothing the material flow were the things people did together to become a greater team and a sustainable company. The ever-distant goals of right-first-time, just-in-time, zero-defect and batch-of-one production were inspirations to excellence. This cultural change was enabled by transforming production lines into cellular teams, supervisors and foremen into team leaders, and even the task of tidying-up into adopting the right attitudes of the five ‘S’s.”

Process mapping, streamlining, de-bottlenecking, use of SPC (statistical process control) and six sigma, balanced scorecard measures, pull systems, poke yoke, SMED (single minute exchange of dies), TPM (total productive maintenance), kaizen, team-building; all look attractive, and are relatively quick and easy to apply individually in isolation. There is, however, a great danger of falling into a superficial and component-level application of lean tools when the goal is a fundamental transformation in performance. Their application may be transformational but in some circumstances they may only provide transitory, localised improvement, with the effect on the whole system being minor, or even negative due to unforeseen interaction between initiatives. The motivational costs of an un-whole, patchy approach to change are possibly more significant than the failure to achieve significant cost savings as they inoculate the staff against attempting further change.

Thane’s conclusion, after 13 years at the sharp end in factory management and then five years as a consultant studying this field, is that the piecemeal application of specific lean tools and techniques in a Western culture isn’t always enough to effect a fundamental transformation in purpose, culture and the significant step-up in performance that manufacturing needs to stay world class. The tool set needs to be enhanced and the perspective widened. Thane believes that, “Organisations must seek wholeness as well as leanness.”

What is Wholeness?

How can we get a whole systems’ view of an organisation? “We have found it useful to draw parallels between the human body, its fitness and its health, and an organisation’s structures and their ability to perform well,” Thane says. “We know that human beings are fit, healthy and respond to the stresses of their changing environment when their complex systems and sub-systems work well together and are in balance. The primary organs (heart, lungs, brain, eyes), the connective systems (blood, nervous and lymphatic systems) and the supportive components (bones and muscles), must each be healthy and whole and interact with the other parts in a balanced way. The whole body maintains this balance through feedback loops run by the nervous and endocrine systems. A person’s mental state, aims, lifestyle and attitudes are key to their health as well. People use a medical language to describe how the parts of the body interact to create the functions and behaviour of the body as a whole.”

“Similarly, manufacturing organisations seeking to become fit and healthy and meet the changing demands put upon them need to recognise that they are complex, integrated, social and technical systems. To be healthy, their sub-systems, their primary working units (lines, cells, production departments and front-line teams), their connective systems (HR, finance and IT systems), as well as their other supportive component parts (reception, stores, building facilities and utility services) each need to be healthy and interact with all the other parts in a balanced and healthy way. The performance measurement, evaluation and communication systems should provide feedback loops to control their functions. The culture, strategy and values of an organisation are key as well. Managers and staff need a whole systems’ language to describe how all these parts inter-connect and align to create success for the organisation as a whole.”

Achieving Wholeness

The Tricord model (fig 1) developed by Simon Thane and his colleagues at Tricordant provides a language and way of mapping this healthy balance. The Tricord applies to the organisation as a whole, as well as to each of its sub-units. “It is the alignment of the three outer dimensions of the Tricord, acting in balance around the central core that creates the whole and healthy organisational unit,” Thane explains. “When one part of the Tricord is incomplete or unaligned then an organisation will tend to be dysfunctional, under-producing, cost-adding,  de-motivated and incapable. If all dimensions are present and aligned with each other, then the organisation will be whole, productive, vibrant, capable, competitive and successful. The model therefore provides a diagnostic tool for assessing wholeness.”

Using the Tricord helps a business check that each organisational unit has a clear ‘Identity’, that it knows who it is, where it comes from and what makes it unique. This comes out of its history, cultural rituals and accumulated knowledge.

You can then check that each unit has an appropriate set of current objectives and knows what it wants to achieve. This ‘Concept’ includes a strategy and detailed plan to realise its purpose interpreted in current times and for the current market. It provides a clear vision and an effective set of values and ethics that are key to the organisation’s culture, whether this is written down or not.

The plan then needs to be delivered on the ground. This is done by the organisation through capable processes that are ‘Embodied’ in technology, equipment, procedures, rules and policies. More critically, the Concept is embodied through people working as teams using these processes and technology, or, in other words, all this is an integrated socio-technical system.

“The organisation is brought alive by the energy and spirit of its people,” Thane says. “They come to identify with the company and to be passionate about its purpose. Work groups are transformed into teams. Managers act as leaders. The organisational unit is thus inspired.”

“This pattern of tricordant wholeness needs to be true at every level of the organisation; the company as a whole, its sub-systems – divisions, sites, functions – and its sub-sub-systems – shop-floor lines and cells, and front-line departments and teams – down to the design of individual jobs. The model can be used to check that the right work is done at the right level, and that the units at all levels align and work together as a whole organisation.

“Such a whole systems approach can be used by a multi-disciplined team drawn from across the organisation. Once trained they can identify the gaps and ‘red arrows’ or points of friction and cost in the whole system and then create solutions to remove these barriers. The tools enable them to ensure that each element of work is done in the right place. It enables value-adding jobs to be designed, which motivate and enable people to use their full capacity. People can then work in motivated teams. These teams can be logically grouped into the right sections, divisions and business units. We call this transforming a business from being discordant (fig 2) to being tricordant.”

Transforming by Wholeness as well as Leanness

The Toyota Production System was able to achieve whole systems-level transformational change in its original sectors. Its kitbag of tools was developed in this manufacturing context and there enabled staff to map process flows, eliminate waste, improve process capability and release team-based continuous improvement. It was very successful for Toyota and many other manufacturers in similar industries. Applied in full the cumulative effect of applying all the principles and tools was to create a groundbreaking shift in thinking, which redefined purpose for staff and changed culture.

“Achieving such a paradigm shift, involving all domains of the Tricord in parallel, was the core transformation which made lean really different when it worked in full and released the maximum value of the approach,” Thane says. “However, lean does not provide all of the answers all of the time. As one gets further away from this heartland so fewer of the tools apply and many apply less fully. A subset of tools applied in a component fashion has a much-reduced chance of triggering the key transformation in purpose, systems and culture.

“By using a whole systems approach each organisation can reach a solution for its unique circumstances. Some parts of the solution may well borrow tools from lean, others parts will borrow from elsewhere, and others may need new thinking and innovation. How they all knit together into a particular pattern will be unique for each organisation.”

Developing this organisational understanding comes from a deeper appreciation of how the parts make up the whole. With that understanding a manufacturing organisation can, according to Thane, achieve an initial 10% to 30% improvement across a range of key performance measures and set itself on the path to a ‘whole systems’ transformation and a healthier and longer life.

More information about The Tricord Model can be found at www.tricordant.com

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