Vergence Business Associates - Catalysts For Process Excellence - Toronto, Ontario, Canada

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Until Next Time – STAY lean!

Using TRIZ for Problem Solving – Resources

In our first post on this topic, “Using Triz for Problem Solving – Introduction“, we provided a very basic introduction to TRIZ.  In the spirit of TRIZ, it is not our intent to rewrite or redefine the TRIZ process when excellent information is already available.  Our intent is to identify the few of the many excellent and exceptional resources that we have found.

What is TRIZ?

To learn more about TRIZ and it’s applications we suggest visiting the following web sites that present a tremendous amount of information on the development and application of TRIZ.

• The TRIZ Journal:  http://www.triz-journal.com.  A clear overview of TRIZ and the principles of TRIZ can be found at http://www.triz-journal.com/archives/what_is_triz/
• The official Altshuller Institute for TRIZ Studies:  http://www.aitriz.org/
• Comprehensive TRIZ and more:  http://www.mazur.net/triz/

TRIZ Principles

40 Inventive Principles with Examples:

Examples for each of the 40 Inventive Principles can be found at the following link:  http://www.triz-journal.com/archives/1997/07/b/index.html

TRIZ Resources

The Contradiction matrix:

As you will have learned from reading the “What is TRIZ?” page from the link above, one of the tools of TRIZ is the Contradiction Matrix that consists of 40 elements.  The TRIZ Contradiction Matrix is available as an Excel Spreadsheet through the following link:

http://www.triz-journal.com/archives/1997/07/matrix.xls

The TRIZ Journal ARTICLES:

The Triz Journal presents many informative articles.  One very intriguing article, ”TRIZ / Systematic Innovation Enhances Hoshin Kanri“, by Darrell Mann and Ellen Domb, demonstrates the principles of TRIZ in a unique application.

An excellent article, “Create a High Performance Culture with Hoshin Kanri”, by Frank Deno can be found at the following link http://www.realinnovation.com/content/c080623a.asp

WEB Sites:

• http://www.TRIZ-Journal.com
• http://www.mazur.net/triz/
• http://www.realinnovation.com
• http://www.aitriz.org/
• http://www.ideationtriz.com/home.asp
• http://www.trizgroup.com
• http://www.triz40.com

TRIZ Books:

A number of books are available on the topic of TRIZ.  Click here to preview the selections currently available.

TRIZ Challenges:

TRIZ is not without its challenges.  Although TRIZ has evolved over many years, it still remains relatively unknown and few companies seem to be ready to adopt this problem solving method.

An excellent article, “Enhancing TRIZ with Dr. Deming’s Philosophy“, by Ellen Domb and Bill Bellows, presents some interesting insights to this challenge.

We typically tend to avoid “labels” for the method we are using to solve a specific problem.  Unlike a surgeon “requesting specific tools (scalpel)” while performing an operation, our strategy tends to be a blended “hybrid” approach to problem solving; TRIZ happens to be one of the more effective methods that we have learned to use over the past few years.

The acceptance of TRIZ may be attributed to the current struggles many companies experience simply attempting to complete an 8D or 5-Why.  Of course, that would only be true of companies who are void of the Lean principles and methods – right?  TRIZ also has a perceived complexity that does not lend itself to ready adaptation as a company-wide problem solving tool.

We would recommend reviewing the many available books on the topic of TRIZ.  Integrating a tool such as TRIZ will require someone to become the leading expert.  Click here to see the various book selections that are available.

Unfortunately, for many companies, the discipline or the structure is simply not there to support effective problem solving efforts.  Perhaps if more time was spent solving the real problems, they would have more time to solve problems not yet realized.

Remember to get your TRIZ - Click Here!

Until Next Time – STAY Lean!

Using TRIZ for Problem Solving – Introduction

Using TRIZ for Problem Solving – Introduction

A famous quote from Albert Einstein, “The problems that exist in the world today cannot be solved by the level of thinking that created them.“, applies to the discussion of problem solving and more so to the topic of TRIZ, The Theory of Inventive Problem Solving, developed by Genrich S. Altshuller.

TRIZ – Theory of Inventive Problem Solving

Genrich S. Altshuller developed TRIZ based on his search for a standard method to solve problems.  At the very basic level, once a problem is identified the objective is to determine whether a similar problem has already existed elsewhere.  If so, study the solution and determine whether it can be incorporated into the current solution being sought.  Taken one step further, consider the possibility that a different perspective of the problem may also present a unique inventive solution.

It does not seem too far fetched that the problem to be solved has occurred elsewhere in a completely different context.  The solution that is found may also be out of the context but the concept may lead to an innovative solution for the current problem at hand where one never before existed.

The application of TRIZ requires an open mind.  We often bring our “tool box” of experience to the table and draw on those tools and our wealth of knowledge to create a solution.  TRIZ is a tool that can be used to create completely new and unique solutions to a given problem.  This doesn’t mean that we need to abandon our current technology and know-how; it simply means that there may be other options where the current know-how and / or technology may not apply or it may be applied in a manner that is quite different than it is today.

Identify the Real Problem to be Solved

Any problem solving method can only be successful if the true root cause is identified.  Once found, a clear and concise problem statement must be formulated to assure that the solution developed and implemented indeed addresses the true root cause.

Searching for Solutions:

Once a problem has been identified, the next question is, “How do we solve it?”  There are a number of techniques that can be used such as brain storming and idea mapping, however, one seldomly used technique is TRIZ:  Theory of Inventive Problem Solving.

Every day we are challenged with a diverse range of problems from machine malfunctions to defective parts.  The very nature of any company’s operations requires an immediate fix to restore operations to “normal”.  Recognizing that a problem exists is not the same as understanding what the problem is and effectively solving the problem requires that we have identified the true root cause and not just the symptoms.

Many tools are readily available to even help us address these concerns or identify where opportunities exist to make improvements.  Unfortunately, these tools seldom provide the solution to the problem.  Too often we are trapped inside the box of current thinking, technologies, standards, methodologies, present knowledge, and even company policy.  Our own levels of thinking and plausible solutions are influenced and limited by our current understanding and knowledge of the problem as well as our own experiences.

The Basis for Using TRIZ to Solve Problems:

Technology

In some cases, product or part designs themselves may be constrained as engineers and designers work to generate a design tailored to a specific, known, technology.  Quality Function Deployment is one strategy that provides a platform to explore alternative design and process approaches before committing to a specific technology or process.

It is worth noting that, although product design is critical, processes and technologies used to manufacture the product itself are often overlooked and seldom are the process constraints and their affects ever considered.  There are many examples where numerous hours are wasted attempting to develop tools using traditional technologies to produce parts that conform to the wishes of engineers and designers.

How do we actually go about solving problems where the technology or the design present constraints that prevent success?  This is the basis for TRIZ:  We have clearly identified the problem to be solved, now we need a solution to resolve it.

Problem Classifications

Although problems may have varying degrees of difficulty, the solutions for them can only fall into one of two overly simplified categories:  Known or Unknown.  While this classification may appear simple on the surface, consider the unknown solution.  Is it truly unknown or is it only unknown to you.

1. Known:  Surrogate process already proven and only requires adaptation for the current situtation.  The “problem solver” has an awareness or experience related to the solution.
2. Unknown:  Typically, solutions are often limited by the scope of experience of the person or person(s) attempting to solve the problem.
   1. The problem solver is not aware of the solution’s existence (Personal)
   2. The solution is outside the problem solver’s scope of experience, training, or field of expertise, but may exist within the company (Company)
   3. The solution is not known within the company but is known within the industry (Industry)
   4. A solution can be realized although it does not presently exist (Outside Industry).
   5. Requires an inventive solution that goes beyond improving the existing condition and is not known to exist anywhere.
3. Although a solution may be found or developed internally, it may not necessarily be ideal.  We recommend continual review of trade journals, going to trade shows, and networking not only with industry peers but outside your areas of expertise as well.

We will pursue the TRIZ methodology as both a learning and problem solving method.  Often times the solution to a problem requires a different perspective to achieve an effective resolution.

Applying TRIZ in the real world:

TRIZ can be used to develop solutions in a wide range of applications.  As Contingency Plans are developed, you may determine that a solution is required to address a problem or crisis that company has not yet experienced.  As we have discussed, the information or solution to the pending “crisis” may already exist elsewhere.  Similarly, improvements to Overall Equipment Efficiency may require solutions to be developed to address problems or opportunities that are inhibiting continued improvement. 

We will continue to pursue the application of TRIZ in the real world and present a more detailed case study.  

Note:  We would also recommend and encourage you to visit http://www.mazur.net/triz/ for an indepth presentation and detailed discussion of TRIZ.  This site provides greater detail and background that is presently beyond the application or scope of this series.

Until Next Time – STAY Lean!

 

 

Contingency Plans – Crisis Management in Lean Organizations

Contingency Planning For Lean Organizations – Part IV – Crisis Management

In a previous post we eluded that lean organizations are likely to be more susceptible to disruptions or adverse conditions and may even have a greater impact on the business.  To some degree this may be true, however, in reality, Lean has positioned these organizations to be more agile and extremely responsive to crisis situations to mitigate losses.

True lean organizations have learned to manage change as normal course of operation.  A crisis only presents a disruption of larger scale.  Chapter 10 of Steven J. Spear’s book, ”Chasing the Rabbit”, exemplifies how high velocity, or lean, organizations have managed to overcome significant crisis situations that would typically cripple most organizations.

Problem solving is intrinsic at all levels of a lean organization and, in the case of Toyota, problem solving skills extend beyond the walls of the organization itself.  It is clear that an infrastructure of people having well developed problem solving skills is a key component to managing the unexpected.    The events presented in this chapter demonstrate the agility that is present in a lean organization, namely Toyota in this case and it’s supplier base.

Training is a Contingency

Toyota has clearly been the leader in Lean manufacturing and even more so in developing problem solving skills at all levels of the organization company-wide.  The primary reason for this is the investment that Toyota puts into the development of people and their problem solving skills at the onset of their employment with the company.  The ability to see problems, correct them in real time, and share the results (company-wide) is a testament to the system and it’s effectiveness has been proven on many occassions.

Prevention, preparation, and training (which is also a form of prevention) are as much an integral part of  contingency planning as are the actual steps that must be executed when a crisis situation occurs.  Toyota has developed a rapid response reflex that is inherent in the organization’s infrastructure to rapidly regain it’s capabilities when a crisis strikes.

Crisis Culture

We highly recommend reading Steven J. Spear’s “Chasing the Rabbit” to learn and appreciate the four capabilities that distinguish “High Velocity” organizations.  The key to lean is creating a cultural climate that is driven by the relentless pursuit of improvement and elimination of waste.  Learning to recognize waste and correcting the condition as it occurs requires keen observation and sharp problem solving skills.

Creating a culture of this nature is an evolutionary process – not revolutionary.  In many ways the simplicity of the four capabilities is it’s greatest ally.  Instilling these principles and capabilities into the organization demands time and effort, but the results are well worth it.  Lean was not intended to be complex and the principles demonstrated and exemplified in Chasing the Rabbit confirm this to be true.  This is not to be construed as saying that the challenges are easy … but with the right team they are certainly easier.

Until Next Time – STAY Lean!

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Contingency Planning For Lean Organizations – H1N1 (Swine Flu) – Reference

In our first post on Contingency Planning For Lean Organizations, we made reference to the current situation regarding the H1N1 virus or Swine Flu. We also suggested that history may provide relevant information that can be used to aid in future crisis event planning.

Michael A. Roberto, author of “Know What You Don’t Know” copyright 2009 by Pearson Education Inc., presents a case surrounding the 1976 “swine flu” incident to exemplify how faulty analogies can have devastating effects. In his book, Michael Roberto cites research of Richard Neustadt and Ernest May.

An excerpt from the book, reference pages 77-78, reads as follows:

“In that situation, President Gerald Ford and his advisors drew an erroneous analogy to the infamous flu epidemic of 1918. The faulty analogy led them to dramatically overestimate the seriousness of the problem they faced. As a result, they embarked on a very comprehensive and unnecessary immunization program. Roughly five hundred people experienced a serious side effect that was linked to the immunizations, and twenty five people died.”

This may explain the slow, seemingly uncoordinated, pace of the government to address the current H1N1 outbreak. Many people remain skeptical as to whether the immunization process is safe. This skepticism may be warranted. Again, referencing Michael Roberto’s book “Know What You Don’t Know” (page 78), “More people died from the immunization than from the flu itself.”

The experts of the day advised that this could be another epidemic. Two prior non-swine flu outbreaks, one in 1957 and the other in 1968, caught the government off guard. It is more than noteworthy that an estimated twenty million people were killed world-wide by the virus during the epidemic of 1918.

With mounting pressure from the Centers for Disease Control to avoid history repeating itself and in an effort to be pro-active, immunizations were ordered and given to an estimated forty million people. What would you have done?

For more information we recommend reading “Knowing What You Don’t Know – How Great Leaders Prevent Problems Before They Happen” by Michael A. Roberto, copyright 2009 by Pearson Education Inc., publishing as Wharton School Publishing, Upper Saddle River, New Jersey 07458 (ISBN: 0-13-156815-9), Pages 202.

Also see Warner, J. “The Sky Is Falling: An analysis of the Swine Flu Affair of 1976.” http://www.harverford.edu/biology/edwards/disease/viral_essays/warnervirus.htm

Until Next Time – STAY Lean!

Lean Contingency Planning For Lean Operations – IT and the BSOD

Coincidentally, we are having a first hand experience with the Blue Screen of Death or BSOD with one of our laptops today.  The completely unexpected critical system error that renders Windows completely helpless.  If this isn’t on your list of IT concerns, it should be.

In our case the error appears to be video related – driver or card.  Most IT specialists know how to deal with these types of errors but for the average user, the message that appears is enough to make you sweat.  If the system can’t fix the error, you may very well end up staring at a Black Screen – just as we are.

How is it that we were still able to produce this POST?  Well, we are currently executing our contingency plan and using another system that is operated independently.  Most companies back up their data to prevent or minimize loss.  Another concern that is often overlooked is accessibility to that back up data in the event the system goes down.

What have we learned?

We are not the first to experience this problem.  We did a Google search using some brief terms such as “Computer Black Screen”, “Laptop Black Screen”, and we even Googled parts of the error message that appeared on the screen.  The result?  Thousands of people have experienced this same error.

The point of this post is to demonstrate that you do not have to re-invent the wheel to determine potential solutions or to discover problems that may occur.  Quite likely, they may already have happened and solutions are already developed and available.

There are two probable solutions to our video issue:

1. Update the video device driver (Free)
2. Replace the video card (Cost $)

Hopefully, the first solution is the answer to our problem.  Video cards are not sitting on our shelf and the downtime may be extended if we can’t find something locally.

It is noteworthy that we have not yet identified the root cause of this failure.  We haven’t loaded any new software or experienced problems in recent history.  This may be the topic for a future problem solving post.

Regardless of the outcome of our present dilemma, we have learned that it is a good idea to keep device drivers up to date.  As a planned activity, this may prevent some of you from having to experience the BSOD as we have today.

The loss incurred for this event is more than just the cost to repair.  This computer may be down for a few days.  How much is the down time worth?  Unless we play out the scenarios that may threaten or pose a risk to our business, we may never have the opportunity to prepare for the event until it actually happens.

Keep an open mind and use the resources available to you to help solve the problem.  In some cases a simple Google search could confirm your concern in a matter of seconds.

Until Next Time – STAY Lean!

Contingency Planning For Lean Operations – Part III

Contingency Planning for Lean Operations – Part III

 

“Deaths spark huge crib recall” was the main headline of today’s Toronto Star (24-Nov-09).  This recall was the result of 4 infant deaths and affects up to 2.1 million units sold.  Click here to access the full article.  This announcement has made headlines throughout North America and is certain to be featured on all of the major network news stations.

Managing a major product recall is likely one of the more significant events where contingency plans are fully executed and developed.  As tragic or unfortunate as the events may be, it is imperative for a company to manage the recall event in professional and responsible manner.  While it may seem difficult to prepare for an event that has not yet occurred, learning to anticipate the sequence of events to recovery and to script are necessary steps to developing an effective contingency plan.

What are the elements of an effective contingency plan?

We will be covering the elements of an effective contingency plan over the next few posts.  Before we get too far into the process, it is important to recognize that one of the critical skills required as part of the contingency planning process is the ability to perform an effective risk assessment.

It is not our intent to cover all aspects regarding risk assessments and analysis as this would require a book in itself.

A newly released book, The Failure of Risk Management – Why It’s Broken and How to Fix It, by Douglas W. Hubbard (copyright 2009) and published by John Wiley & Sons, Inc., provides extensive insight and resources to perform effective Risk Management Assessments and Analysis.  The reasons why some risk management methods fail or are susceptible to failure are also covered in detail.

As exemplified in the opening article, there is no real means to measure the net effect or impact of a recall campaign of this magnitude.  Elements such as Consumer Confidence, Brand Loyalty, Loss of Life, or Warranty are difficult to value in tangible terms.

Unfortunately, there are too many examples of crisis events where the knowledge was available to rectify or fix the situation before any tragic event occurred.  As heard in many workplaces, “Why is that nothing is done until something bad happens?”

An effective contingency planning is not only designed to manage tragic or crisis events, it should also aid to identify potential failure modes that can be captured and addressed before a product is ever released for mass production or to market.  Consider the following two scenarios:

• Scenario 1: (Highly unlikely …)
  • Jill:  What if the part fails?
  • Jack:  We’ll recall it.
  • Jill:  How will we do that?
  • Jack:  We have an excellent recall management process

What if the dialogue took a different turn as follows:

• Scenario 2:  (More likely …)
  • Jill:  What if the part fails?
  • Jack:  What could possibly go wrong?  It’s perfect.
  • Jill:  Engineering said it barely passed the tests.
  • Jack:  Well, maybe we should take another look at the design.
  • Jill:  Great, you know we can’t risk a recall.

Developing a Contingency Plan – The Process

1.  Corporate Responsibilities – Charter

If contingency planning ever concerns an individual person in the company directly, it is the Chief Executive Officer or the president who are personally at risk of significant legal ramifications and also the greatest level of exposure.

This past year Maple Leaf Foods experienced a major Listeria outbreak at one of their food processing facilities.  Contaminated product reached the market place resulting in illness and loss of life.  A major recall was initiated and the company immediately initiated corrective actions.  During this crisis, the CEO took personal responsibility for public relations, communicating the strategy, and ultimately overseeing the recovery process.

The CEO or President should be leading the charge for the development of contingency plans and to assure their effectiveness.  To this end, it is also imperative that the team responsible for formulating the plan includes a cross-section of people from across the company.

The CEO or President will also want to assure that everyone is trained to respond to events that pertain their specific areas of responsibility.

2.  Contingency Planning – Form a Team

As we mentioned in our previous posts, contingency planning is an enterprise-wide process.  The collective intelligence of the team is greater than that of any team member.

You should consider the skill sets that may be required to support the team.  Although we are not suggesting that you need to be an expert in probability theory or statistics, someone having exposure to these types of assessment tools or an outside consultant may be worth the effort.

It is not possible for one committee to prepare contingency plans for every area in the company.  When forming teams, how the skills and levels of expertise required to support the team in one area may be vastly different for another area.  For example, Product Engineering and Operations will have different failure modes to contend with.

To ensure the appropriate resources are available, we recommend that  executive management or a steering committee are assigned to oversee the contingency planning and development process.

Based on some of the scenarios cited in this post, it would stand to reason that most CEO’, Presidents, and / or owners are primary stake holders in the Contingency Planning process.

More will follow:

• Performing Risk Assessments
• Contingency Planning Tools
• Do The DRILL
• Publish
• Review

Until Next Time – STAY Lean!

Lean is Eco-Friendly – Coke Shows How

Today’s front page of the Toronto Star (Monday 22-Nov-09) featured an article on Coke’s new Eco-Bottle. The revolutionary plastic made from sugar cane byproducts is not biodegradable but can be 100% recycled.

Are companies beginning to understand how their product or service may be impacting the environment?  Coca Cola has taken corporate leadership to the next level.  For Coca Cola, understanding how the “complete” product affects the environment has driven tangible change to make a difference.

While Coke’s new eco-bottle is welcomed news, environmentally friendly or Eco-Friendly products are only one aspect to consider in terms of impact to the environment.  Other considerations include how and where the product is manufactured and end-of-life disposal.  At least Coke has addressed the end-of-life disposal aspect.

An extension to the manufacturing process is supply chain management from origination to the final consumer.  The transportation required to supply raw materials, produce, package, and distribute the final product  is as much a concern to the environment.

There is as much activity, if not more, in waste management and recycling than in the manufacturing and distribution processes.  Every stage of phase of a product’s life cycle generates waste in various forms.

Waste management companies are subject to the same environmental impacts through their own supply chain and distribution management, the recycling and disposal processes, and packaging of the product whether or recycled or deemed true end item waste.

Coke at least has demonstrated how large companies can take responsibility for the products they sell.  As consumers, we still have to do our part by making sure the bottle makes it to the recycling bin.

When you are the leading softdrink company in the world it follows that if you can’t improve your product then improve the packaging. We’re sure this will be part of a new marketing campaign to promote Coke as an eco-friendly company – and so it should.

From a Lean Manufacturing perspective, Coke has clearly demonstrated that Lean extends to every facet of the business – inside, outside, and beyond.  This is improving relentlessly.

Until Next Time – STAY Lean!

We are not affiliated with Coca Cola, Coke, or it’s products and services.

Celebrating 1 Year Online

November19, 2009, marked our 1 year anniversary on this blog.  Click here to see our first post.

Thank you to all of our visitors and of course the people behind the scenes.   

Please feel free to forward any questions, comments, or suggest a topic for review.  If you don’t like the public forum, we can always be reached by e-mail at leanexecution@gmail.com or vergence.consulting@gmail.com. We appreciate your feedback. 

Contingency Planning For Lean Operations (II)

Contingency Planning For Lean Operations – Part II

Putting together a contingency plan can be quite challenging when you consider all the things that could go wrong at any given point in time.  Contingency plans should not only be restricted to ”things gone wrong” and are not limited to operations or process specific events.  All aspects of an operation are prone to risk.  As such, contingency planning must be an enterprise wide activity.

Failing to understand and assess the risks that may impact your operation is a recipe for future failure.  If you fail to plan then plan to fail.  The same is true for contingency plans.  Effective risk management and contingency planning are critical to minimize or eliminate the effects of failure.

Natural disasters (like we’ve never seen before) continue to plague us without prediction.  Yet, we are able to respond immediately and effectively.  If you get hurt or injured, someone is there to help you simply by dialing 911.  Emergency units are ever present and available to respond.

Unfortunately the same is not necessarily true for business.  The recent turn in the economy caused financial markets to tumble and decimated corporations on every scale.  Millions of people are affected by the fallout.  The government “loans” were not crafted after the event.  Did contingency plans exist to even consider this level of change in the economy?

Although history may be the best predictor of future events, it is not exclusive or exhaustive to predicting unforeseen future events.  Even if history did provide a glimpse of potential future failures, we may simply choose to ignore the probability of recurrence – this isn’t the first time the financial markets have crashed, yet we can’t seem to determine or understand what key indicators existed that could have prevented this current situation.

Certainly new variables are introduced as technologies continue to evolve and become more integral in our operations.

In Part I of this series we suggested that contingency plans should be prepared to address potential labour challenges and more specifically availability.  Certainly, the recent concerns regarding the H1N1 virus have heightened attention with respect to labour shortages.

• Inclement Weather – Immediate effects of Snow Storm, Hurricane, Heavy Rain, Tornado.
  • Other considerations include:
    • Duration
    • Seasons
    • Cumulative Severity
    • Delayed Effects (flooding)
    • Property Damage.
• Accident / Injury:  Personal versus Workplace
  • Long Term
  • Short term
  • Considerations to reduce or minimize impact to operations:
    • Early Return To Work
    • Modified Duty
    • Restricted Duty
    • Reduced Hours
• Illness (Personal / Family / Extended Family)
  • Short Term
    • (Flu, Cold)
    • Emergency
  • Long Term
    • Surgical Care
    • Chronic Care
• Sudden Premature Death
• Parental Leave (Maternity Leave)
• Bereavement – Immediate Family, Out of Country
• Retirement / Attrition
• Training
  • Onsite vs Offsite
  • Duration
• Meetings – Department
  • Company Wide
  • On Site
  • Customer Site
• Quality Disruption
  • Containment Activity
    • Sorting
    • Rework
• Travel
• Vacation Allowance / Timing
  • Customer Driven
  • Company Mandated
  • Personal Choice
  • Season
  • Duration
    • New Hires – Zero Weeks
    • Senior Employees – Per “X” Years of Service
• Holidays
• Absenteeism (Culpable)
• Layoff and Recall
  • Short Term
  • Long Term
• Supply Chain Disruptions – Raw Material or Part Supply
• Planned Shutdown / Start Up Events – Holidays
• Leave of Absence – Short Term / Long Term
• Facilities
  • Loss of Utilities:  Water, Electricity
  • Fire, Suspended Services
  • Parking Availability
  • Locker Space
• Equipment – Breakdown / Malfunction (Major)
• Tooling – Breakdown  / Malfunction (Major)
• Skill Levels Required – Non-Skilled, Semi-Skilled, and Skilled Labour
•  Union – Strike
• Customer Decreases
  • Shutdown (Reduced Volume)
  • Slow Down (Reduced Volume)
  • Reduced Work Week (4 vs. 5 days)
  • Shutdown (Planned)
• Customer Increases:
  • Volume
  • Extended Work Days (Daily Overtime)
  • Extended Work Week (Saturday)

There are likely more areas of concern that may impact your labour pool, however, this does serve as a starting point.  Do all of the above elements require a contingency plan?  Not necessarily.  We still contend that it is good practice to document all potential concerns.  It is easier to add a note to document the reason for exclusion from the contingency plan by stating:

• The following elements were discussed during the preparation of this plan, however, specific contingency plans were not considered necessary at the time of review:
  • Training – Scheduled Activity
  • Culpable Absenteeism – Progressive Discipline Program
  • Add Elements to the List as applicable

This latter task may seem somewhat trivial, but consider who else may be reading the report.  Defining the scope of the contingency plan and adding a list of exclusions supported with reason(s) clarifies any ommissions from the core plan, will minimize the time required for review, and eliminates any assumptions regarding unintended ommisions.

Our next post will address the elements to be considered when developing a contingency plan.

Until Next Time – STAY Lean!

Contingency Planning For Lean Operations – Part I

Contingency Planning For Lean Operations – Part I

Lean operations are driven by effective planning and efficient execution of core activities to ensure optimal performance is achieved and sustained.  The very nature of lean requires extreme attention to detail through all phases of planning and execution.  Upstream operations simply cannot tolerate any disruptions in product supply or process flow without the risk of incurring significant downtime costs or other related losses.

Effective risk management methods, contingency plans, and loss prevention strategy are critical components of successful operations management in a lean operation.  Risk management and preventing disruptions is the subject of contingency planning and requires the participation of all team members.

Successful contingency planning assures the establishment of an effective communication strategy and identification of core activities and actions required.  Contingency plans may require alternative methods, processes, systems, sources, or services and must be verified, validated, and tested prior to implementation.

Understanding and assessing the potential risks to your operation is the basis for contingency planning with the objective to minimize or eliminate potential losses.

Inventory represents the most basic form of contingency planning.  Safety stock or buffer inventories are typically used to minimize the effects of equipment downtime or disruptions in the supply chain. 

The levels of inventory to maintain are dependent on a number factors including Lead Time, Value, Carrying Cost, Transit Time (Distance), Shelf Life, Minimum Order Quantities, Payment Terms, and Obsolescence.

Why is this relevant?

Material and Labour represent two key resources that may be influenced by external factors that are beyond the control of any company policy or practice.  Internally controlled or managed resources such facilities, equipment, and tooling are less susceptible to unknown elements.  For the purposes of this discussion, we will examine Labour in a little more detail.

The H1N1 virus, originally known as the Swine Flu, is the latest potential health pandemic since the outbreak of SARS only a few years ago.  The government has been struggling to organize mass immunization clinics and to engage the media to aid in the cause.  In the meantime, the potential impact of the H1N1 virus on your operation remains to be an unknown. 

Experts have commented to the media that the lessons from the SARS outbreak have still not been learned.  One would expect that past practices would have already been adopted into new best practices from our experiences with other similar events in our history.

Government agencies at all levels (Federal, Provincial, and local) have mismanaged the activities required to procure and distribute the vaccine, and failed to provide an effective communication and immunization strategy to ensure the risk to public health was minimized and the at the very least understood.

The lack of coordination and accountability for the success or failure of the communication strategy, procurement and distribution of the vaccine, and other related activities are strong indicators that the planning process did not consider the infrastructure requirements and relationships needed between levels of government.

The lack of an effective communication strategy introduced confusion and speculation in the media and the general public.  Mass education only seemed to become more aggressive as incidents of severe H1N1 complications and related deaths were reported in the media.

If this really was a pandemic event, many operations today would (and may still) be adversely affected due to direct or indirect (supply chain) labour shortages.  Do you have contingency plans in place to address this concern?

It could be argued that “if we are affected to this extent, then our customers will be as well.”  This is not necessarily true unless your customers and / or suppliers are located in the same immediate area or region of your business.

People travel all the time, whether they are commuting to work from out-of-town or traveling to or arriving from a foreign country on business.  The source of exposure is beyond your immediate control. 

What other elements can directly impact labour?  We will explore some of these in our next post.  In the meantime, keep your hands washed and remember to cough into your sleeve.

Until Next Time – STAY Lean!

Unexpected and Appreciated – Uncommon Courtesy:  This morning, a person cut into the drive through lane ahead of us – not realizing the gap in the line was there for thru traffic.  Recognizing the error in drive through etiquette and to make amends, we were pleasantly surprised by the ”free” coffee at the pick up window.  Thank you ladies!