Learning with Lean - ASQ Orange...

Learning with Lean Unleashing the Potential for Sustainable

Competitive Advantage

Jim Zurn &

Perry Mulligan QLogic Corporation

Aliso Viejo CA

“The rate at which organizations learn

may soon become the only sustainable

source of competitive advantage.”

Today‟s Exploration

(14) Senge, P. (1990). The Fifth Discipline: The Art and Practice of the Learning Organization

Peter Senge

Our incoming premise: Your organization is

already performing well, and generally meeting

stakeholder and customer expectations. You‟re

asking “What does it take to get the organization to

the next level of performance?”

Key Message Constructs

• Sustainable Competitive Advantage (SCA)(14): Ability to deliver a differentiated solution that the customer values which is not available through other sources.

• Applied Rate of Learning (AROL)(7): Activities that engage an organization, and its employees, directly with an opportunity and involve them in creating solutions using the application of theoretical concepts.

• Learning with Lean (LWL)(16): A culture of rapid cycles of organizational learning using One Touch Flow and waste elimination.

(7) Kendall, J. (1990). Combining Service and Learning, A Resource Book for Community and Public Service

(16) Zurn, J.T., Mulligan, P. (2013). Learning with Lean: Unleashing the Potential for Sustainable

Competitive Advantage

(14) Senge, P. (1990). Ibid.

Tattletales of AROL Taking Root

Change

• Organization getting smarter

• Competencies not applied toward same goal

• No synergy evident • No learning in place • Common improvement

tools and methods not evident

• Changes happening • Organization generally

aligned • Some synergy emerging • Pockets of performance

excellence • Ad-hoc learning present • Common Lean tools in

the environment with signs of use

• Systemic changes happen • Synergy of improvements

evident across organization

• Improvements matter for mission success and its customers satisfaction

• Individual and organizational learning in place

Change

Change

Change

Change

Change Change

Change

Change Change

Change

Change

Roll-out Maturing Sustainable

Your market

Disruptive Competitor/Technology Threat

• Your organization is in peril if competitive products

are „good enough‟ and lower price point sways

customer purchase decision

Disruptive technology/ competitor performance for lower cost per performance

Your market at

risk

Tota

l Ava

ilab

le M

arke

t

Time

(3) Christensen, C. M. (1997). The Innovator's Dilemma: When New Technology Causes Great Firms To Fail

Creating Stress to Improve Learning

• Stress required to get organization AROL moving

• Must add internal stress to external stress to

achieve right rate of AROL for organization

Must add internal stress to accelerate AROL when external stress is not present

External stress available from technology/competitive threat

Incremental energy required to start and sustain AROL

Org

aniz

atio

nal

Str

ess

Time

Deployment and Impact Model

• First deployment wave is sizeable

• If you stop part-way up first hill – you‟ll „backslide‟

• Expect when over the „hump‟; you must do it again

• Be patient – don‟t expect big paybacks right away

Achieved some results, but if left alone – will drift back to old ways

Must move from

preparing to doing

Pro

jects w

ith P

ositive

Bu

sine

ss Imp

act Ene

rgy

Re

qu

ire

d t

o D

ep

loy

& M

ain

tain

Time

Steady-state energy to find and remove waste

‘Sustainability horizon’

(12) Prochaska, J. O., Norcross, J. C., & DiClemente, C. C. (1994). Changing for Good

Change Adoption Model

• Adopter segmentation important to deployment – Strong support for innovators/explorers/early adopters

– Clear expectations for early/late majority adopters

– Clear consequences for laggards going forward

Earl

y ad

op

ters

(1

4%

)

Early majority adopters

(34%)

Change resistors – laggards (16%)

Late majority adopters

(34%) Inn

ova

tors

/ e

xplo

rers

(3

%)

Alternate distribution in

today’s environment

(13) Rogers, E. M. (1995). Diffusion of Innovations

Strong support Clear expectations Clear consequences

Culture Optimization for Performance

• Must balance between cultural behaviors: – Control & discipline

– Reaction & response

• Too much of either optimum environment

Organization is locked in concrete

Unstructured organization

reaction

Shift to optimize culture and behaviors

Directionally correct in support of LWL strategy C

on

tro

l & D

isci

plin

e

Low

High

Re

action

& R

esp

on

se

Low

High

Changing Organizational Inertia

Applied Rate of Learning

Succ

ess

in M

arke

t

• Don‟t over-expect

amount of change in

the beginning

• Exponentially harder

moving from high to

low inertia

• Ability to change

based on current

inertia in the

organization

• Assess where your

organization is

Mature

Your organization?

Mo

der

ate

p

erfo

rma

nce

M

ark

et le

ad

ing

p

erfo

rma

nce

Initial

• High inertia

• Success linked to

past performance

• Low external stress

• ACTION: Significant

investment in

Leader’s personal

energy

• Low inertia

• Success in leading

the market

• Low external stress

• ACTION: Keep

investing

• Medium inertia

• Limited success

• Moderate external

stress

• ACTION: Need to

begin the Journey

• Low inertia

• Limited success

• Moderate external

stress

• ACTION: Focus on

LWL

Transformation Cycle Phases

Phase 5

Learn

Phase 4

Do Phase 3

Prepare

Phase 2

Plan

Assessment, Leaders &

Organization

Architect & plan transformation

Up-skill the organization

Start & sustain improvement & learning actions

Leverage learnings across

organization

Workers with new

skills

Changes & actions

As-Is SWOT

Recognized need

Road map

Phase 1

Assess Lessons Learned

Try- storming

Suppliers and

Customers

integrated into

LWL Journey

(16) Zurn, J.T., Mulligan, P., Ibid.

Sustain

able C

om

petitive

Ad

vantage w

ith C

usto

mers

and

Markets

Learning with Lean Operational Model

Values

Cultural Behaviors

Human Asset Mgt.

Differentiated Performance

Outcomes

Value Creation

Processes

Leadership & Management

Sup

plie

rs

Direct influence

Indirect influence

Continuously improve in everything you do every day

Be intolerant of bureaucracy, mediocrity, and waste

Make and meet your commitments

Flawless execution to world-class standards

(11) Ohno, T. (1988 English). Toyota Production System: Beyond Large Scale Production (16) Zurn, J.T., Mulligan, P., Ibid.

Organizational Maturity Model

Unable to use Lean learning

methods

Reactive response to identified

broken processes

Evidence of ad-hoc process

improvements using

structured techniques

Systemic cycles of improvement at

process and system level;

learnings captured and shared with

others; visible performance

indicators

Proactive identification of changes needed to attain best-in-

class performance for core processes;

comparative measures in

place; standard work is

optimized

Culture exists for aggressively

finding and removing waste at all levels and

areas; organizational

learning is systemic;

knowledge is captured and

proactively shared

Sustainable

Competitive

Advantage

Level 5

Differentiated

Performance

Level 4

Sustained

Cycles of

Learning

Level 3

Early Learning

Cycles

Level 2

Break/Fix

Culture

Level 1

Resistance

and Inertia

Baseline

Imp

act

of

Org

aniz

atio

nal

Le

arn

ing

Organizational Maturity

(2) Chrissis, M. B., Konrad, M., & Shrum, S. (2003). CMMI: Guidelines for Process Integration and

Product Improvement

Governance

Satisfaction

Quality

Cost

Consistency

Performance Management System

Analysis

Time

Effectiveness Efficiency

Review, analyze and selects actions for improvement

Defines measures in indicator cube

Defines performance outcomes important to organization

Perspective V

isibility

Leading Lagging

Internal

External

Typ

e

Layer 3 Action

Layer 2 Measurement

Layer 1 Foundation

Actions

VOC Feedback Filtering into Actions

Filter to remove ‘noise’, distill data, information and messages

Data, information

and messages organized

by Customer segment

Noisy inputs filtered out

Change actions already identified and

part of continuous improvement

roadmap

Ch

eck

cu

sto

mer

ac

tio

ns

vs. w

ord

s

Customer listening

posts

Segment ‘A’

Segment ‘B’

Segment ‘n’

‘ … ‘

Improvement action

Improvement action

Improvement action

Listening Filtering Action

Pissed-off Value of Marginal Performance

PVMP eliminated

Customer Expectation

Goodness

Effe

ctiv

en

ess

Ou

tco

me

- Q

ual

ity

Customer Experience consistently above expectations Customer Experience includes missed expectations

𝐶𝑢𝑠𝑡𝑜𝑚𝑒𝑟 𝑆𝑎𝑡𝑖𝑠𝑓𝑎𝑐𝑡𝑖𝑜𝑛

= 𝑃𝑉𝑀𝑃𝐶𝑢𝑠𝑡𝑜𝑚𝑒𝑟 𝐸𝑥𝑝𝑒𝑟𝑖𝑒𝑛𝑐𝑒𝑠

𝑛

1

Reduced variation when meeting commitments eliminates PVMP and improves customer experience

Where:

PVMP = sum of negative

experiences for incidents by

individual customers

(16) Zurn, J.T., Mulligan, P., Ibid.

Porpoising Communication

Strategic Direction

(theoretical)

Tactical Execution (practical)

Lean instructors

Middle mgrs./

supervisors

All employees

Kaizen teams

Lean leaders

Senior leaders

Customer/ suppliers

Porpoising communication

Target size is % proportion of content mix

Walk-away Points

• Your commitment either lead, ride the wave, or

be left behind

• Change is happening, not everyone will join

• Adopt Lean as learning vehicle organization-wide

• Challenge everything – there‟s 80% waste

opportunities in un-improved processes

• Focus on learning above perfection – success

follows naturally

• Pay attention to disruptive threats and listen

to your Customers – but use caution

• Get great at porpoising communication

Sources

1. Camp, R. (1989). Benchmarking: The Search for Industry Best Practices that Lead to Superior Performance. Milwaukee WI:

Quality Press.

2. Chrissis, M. B., Konrad, M., & Shrum, S. (2003). CMMI: Guidelines for Process Integration and Product Improvement. Boston MA:

Addison-Wesley, Pearson Education Inc.

3. Christensen, C. M. (1997). The Innovator's Dilemma: When New Technology Causes Great Firms To Fail. Boston MA: Harvard

Business School Press.

4. Earle, R., Imrie, D., & Archbold, R. (1989). Your Vitality Quotient: The Clinically Proven Program That Can Reduce Your Body

Age - And Increase Your Zest For Life. New York NY: Warner Books.

5. Good, M. (2003, Vol. 37). Patient Simulation for Training Basic and Advanced Clinical Skills. Medical Education, 14-21.

6. Hiatt, J. M. (2006). ADKAR: A Model for Change in Business, Government and our Community. Loveland CO: Prosci Learning

Center Publications.

7. Kendall, J. (1990). Combining Service and Learning, A Resource Book for Community and Public Service. Raleigh NC: National

Society for Internships and Experimental Education

8. Knerr, B. W., Lampton, D. R., Thomas, M., Corner, B. D., & Grosse, J. R. (2003). Virtual Environments for Dismounted Soldier

Simulation, Training, and Mission Rehearsal: Results of the FY 2002 Culminating Event. Orlando FL: U.S. Army Research

Center.

9. Kotter, J. P. (1996). Leading Change. Cambridge MA: Harvard Business Review Press.

10. Lewin, K. (1947). Frontier in Group Dynamics. Human Relations, 143-153.

11. Lowenstein, M. W. (1995). Customer Retention: An Integrated Process for Keeping Your Best Customers. Milwaukee WI: Quality

Press.

12. Ohno, T. (1988 English). Toyota Production System: Beyond Large Scale Production. New York NY: Productivity Press.

13. Prochaska, J. O., Norcross, J. C., & DiClemente, C. C. (1994). Changing for Good: The revolutionary program that explains the

six stages of change and teaches you how to free yourself from bad habits.

New York NY: W. Morrow Inc.

14. Rogers, E. M. (1995). Diffusion of Innovations. New York NY: The Free Press - Simon & Schuster.

15. Senge, P. (1990). The Fifth Discipline: The Art and Practice of the Learning Organization.

New York NY: Doubleday.

16. Zurn, J.T., Mulligan, P. (2013). Learning with Lean: Unleashing the Potential for Sustainable

Competitive Advantage. New York NY: Taylor & Francis

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