The Outstanding Organization:The Power of Clarity

Presenter: Karen Martin

March 22, 2012

Founder of Karen Martin & Associates (1993)

Thought leader in applying Lean to the service sector and office areas within manufacturing

Teaches at University of California, San Diego’s Lean Enterprise program

Email: karen@ksmartin.com

Twitter: @karenmartinopex

Karen Martin, Principal

2012 WebinarsDate Topic

March 22 The Outstanding Organization: The Power of ClarityApril 5 The Outstanding Organization: The Power of FocusMay 3 The Outstanding Organization: The Power of DisciplineMay 17 The Outstanding Organization: The Power of Engagement

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Release Date: July 8, 2012 (McGraw-Hill)

Available for Preorder: www.bit.ly/km-too

Success with Improvement

0%

10%

20%

30%

40%

50%

60%

70%

2001 – The Economist

Temporary LastingNone

17%

63%

20%

4

…A Decade Later

2010 – Accenture

0%

10%

20%

30%

40%

50%

60%

70%

80%

Minimal financial impact

Needs re‐evaluation, restart or complete 

makeover

“Mixed” to “disappointing” 

results

33%

58%69%

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Up to 98,000 deathsannually due tomedical errors.

8th leading cause ofdeath in U.S.

To Err is HumanInstitute of Medicine, 1999

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Southwest Airlines’ Boeing 737 has 137 passenger seats. 

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98,000 lives lost

Improvement Goal:Reduce by 50% in 5 years.

To Err is HumanInstitute of Medicine, 1999

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Not. Even. Close.

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Something Is Terribly Wrong…

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2009

2005 2010

2010

2011

Progress has been slow.

Journal of the American Medical Association

Annual death toll from

medical errors is closer to

200,000.Dead by Mistake

Hearst Newspapers Special Report

180,000 Medicare patients die

annually from medical errors.

Office of the Inspector General

No significant change in rate of

preventable errors.

New England Journal of Medicine

33% hospitalized patients are harmed;

7% result in permanent injury or

death.Health Affairs

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What are we missing?

We need to improve

how we improve.

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Mindsets & Behaviors

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Lack of ClarityLack of Focus

Lack of DisciplineLack of Engagement

The Outstanding Organization

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Business Results

CHOS

Prob

lem Solving

Continuo

us 

Improvem

ent

Resilience

Core Capabilities

April 5  May 3 May 17

17

Lack of ClarityLack of Focus

Lack of DisciplineLack of Engagement

TruthTruth

TruthTruth

TruthTruth

TruthTruth

Truth18

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Ambiguity Abounds…

• Organization purpose & vision• Customers & products• Business goals & priorities• Policies & procedures• Roles & responsibilities• Process performance• Problem solving & decision making• Communication

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Who are your customers? What problem does your good

or service solve?

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What value do these consumer goods companies provide to their customers?

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You must indoctrinateall new hires into who the organization’s customers are and what they value.

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What is Your Improvement Strategy?

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How does work get accomplished? And well how are we doing at it?

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Customer

Process1

Process2

Process3

Process4

LTPT

LTPT PT PT

LT LT

LT = Lead (Throughput) TimePT = Process (Touch) Time

Key Lean Metrics: Quality

• %Complete and Accurate (%C&A)– % time downstream customer can

perform task without having to “CAC” the incoming work:• Correct information or material that was

supplied• Add information that should have been

supplied• Clarify information that should or could have

been clear27

Activity PT LT %C&A Activity PT LT %C&A Activity PT LT %C&A Activity PT LT

Approve PO 15 240 100% Fax PO to Account Manager 5 20 100%

Notify customer when they can expect delivery

15 300 95%

Review and approve PO; send

to Order Entry 5 240 100%

Enter order into SAP 10 240

Step # ? 986

Finance / Credit

Function / Department

LT UnitsHours Worked per Day

37,500Paul Dampier

Occurrences per Year

Current State Metrics-Based Process Map

26-Nov-078

Sam Parks

Date Mapped Michael Prichard

Order FulfillmentProcess NameSpecific Conditions Domestic orders through sales force

PT Units Process Details

Mary TownsendSean MichaelsRyan AustinDianne O'Shea

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Mapping Team

Order Entry

Account Manager

Sales Rep

Customer

Seconds

Minutes

Hours

Days

Seconds

Minutes

Hours

Days

Processes MUST be Clearly Documented

Every key process…

2-5 Key Performance Indicators

Monitored Continually

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Gaining Clarity via Visual Management

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“Going to the gemba has been life changing for me as a leader.” 

What problem are you trying to solve?

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Detailed Steps

 1.  Define and break down the problem.

2.  Grasp the current condition.

 3.  Set a target condition.

 4.  Conduct root cause & gap analysis.

 5.  Identify potential countermeasures.

 6.  Develop & test countermeasure(s)

 7.  Refine and finalize countermeasure(s).

 8.  Implement countermeasure(s).

StudyEvaluate Results

 9.  Measure process performance.

10. Refine, standardize, & stabilize the process.

11. Monitor process performance.

12.  Assess results.

Adjust

Do

Clarifying the PDSA Cycle

PlanDevelop 

Hypothesis

Conduct Experiment

Refine Standardize Stabilize

Phase

Learning How to Clarify: A3 Management

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A3 Report

The vital role of the coach/mentor

Progressive Learning

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Gaining Clarity: Avoid “Fuzzy” Words

• Near / close / far• Short / long• A lot / a little• Many / few / much• Bad / good • Heavy / light• Seems

• High / low• Significant• Fast / slow• Young / new / old • Expensive / cheap• Long / short• “I think…”

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Release Date: July 8, 2012 (McGraw‐Hill)

Available for Preorder: www.bit.ly/km‐too

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Karen Martin, Principal7770 Regents Road #635

San Diego, CA 92122858.677.6799

ksm@ksmartin.comTwitter: @karenmartinopex

For Further Questions

Monthly newsletter: www.ksmartin.com/subscribe