Driving Lean Transformation across a Matrix Organization in Product Development and One Off Productionin Product Development and One-Off Production

“Making Big Lean STICK”

K i N

Making Big Lean STICK

Kevin Naya

How is a satellite like a fruit fly?How is a satellite like a fruit fly?

1-5 year program life cycleR id l ti

2 week life cycleR id l tiRapid evolution

Being used to develop Lean in PDRapid evolutionUsed in genetic research

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Satellites are the fruit flies of Aerospace

Enterprise EnvironmentEnterprise Environment What is “Big”?What is “Big”?

BureaucracyComplexities of a large, interdependent organization

Old School

Red Tape

Existence of cultural norms and resistance to change

Rigid process documentation and policing

Alphabet Soup

Firefighting

Lack of management focus

No change management structure Firefighting

CYA

Sil

No change management structure

Matrix of shared accountability

Di i li d ti Silo

New Boss Again

Disciplined reporting

Leadership turnover

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Hopefully competitors are in the SAME environment

Lesson 1: Seed Your Lean TransformationLesson 1: Seed Your Lean Transformation

2007Leadership – Collaboration, AlignmentPeople – Engagement, Inclusion, TeamingPartnering – Customers, Suppliers, Internal

2006People & Culture – EI Teams Change Agent LeadershipPeople & Culture – EI Teams, Change Agent, LeadershipThroughput – TOC, Critical ChainCommunication – Multi-channel

2005I d I S

2004

Integrated Improvement StrategyEngineer First Pass YieldCOPQ – RCCA – Six Sigma

2004Training/Education – Benchmarked LAI & Boeing Internal, Trained 2000+ EmployeesDeveloped Assessments – Manufacturing, Engineering, Leaders/CompensationReward & Recognition – Cash Awards for Improvement Teams, Celebration Events

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Training, benchmarking, celebration – leading indicators of change

Lesson 2: Prioritize Quality and ThroughputLesson 2: Prioritize Quality and Throughput

First: Prioritize quality and mitigation of technical risk● Open qualifications reduced 100% (was 105)● Bad engineering changes from 51% to 16%● Unit return rate reduced 100% (was 8%)( )● Cost of rework, repair, scrap reduced 70%

Second: Emphasize throughput● On time engineering improved 40% (to 93%)● On-time engineering improved 40% (to 93%)● Electronic unit on-time delivery = 97%

Bottom line results will fall out● Electronic unit Cost Performance Index (CPI) = 0.98● Consistently profitable

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Achieve results by doing the right things first

Lesson 3: Cultivate First Hand ObservationLesson 3: Cultivate First Hand Observation

Gemba● “The place where the truth can be found”p● “The place where you work to create value”

Gembutsu● “Relevant things” or “real thing”

Get real facts and dataFirst Hand Observation● A teacher

A ff ti t i th t th● An effective way to experience the truth● The “Chalk Circle” (Masaaki Imai)● Learn to see

– WorkflowWorkflow– 7 Types of Waste

• Overproduction, Transportation, Motion, Waiting, Processing, Inventory, DefectsWork the crime scene, not the courtroom (conference room)

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First hand observation is the reflex of a Lean culture

Lesson 4: Make Everything Simple

1236 Steps1236 Steps1236 StepsOrder Parts

66 StepsAcquisition to Baseline

233 StepsDrawings

255 StepsParts in Stores

WASStart

1236 StepsOrder Parts

66 StepsAcquisition to Baseline

233 StepsDrawings

255 StepsParts in Stores

WASStart

77%77%

174 StepsAssemble, Test, Ship

Acquisition to Baseline

Assy starts 2 mo. ARO1st unit ships 9 mo. ARO

WAS13156 Steps

StartFinish

174 StepsAssemble, Test, Ship

Acquisition to Baseline

Assy starts 2 mo. ARO1st unit ships 9 mo. ARO

WAS13156 Steps

StartFinish

77% Reduction in 9 weeksWAS

77% Reduction in 9 weeksWAS

11192 StepsParts to Assembly

11192 StepsParts to Assembly

WAS IS

13156 IS 3000WAS IS

13156 IS 3000

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Rapid & dramatic improvement (30% margin lift) is possible

Lesson 5: Make Everything Visible

A l R i R i

Flight Software ValidationR

Electronic Product EngineeringAnalyze Review Revise RouteRun

FLOW

Situational awareness, convergenceCreate visuals, metrics, checklists

Manage engineering throughput 4 iterations of learning , ,

Burn down developmental risksDefine and measure “doneness”

gCultivate the right environmentLeadership, training, empowerment

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Visibility, awareness, mutual understanding/purpose, collaboration

Lesson 6: Manage All Types of WIPLesson 6: Manage All Types of WIP

Manage all types of WIP, especially WIP created by managementmanagementLean Implementation WIP● Does your Kaizen (improvement event) end with 100% doneness?

– Or do you carry and track actions?● Scope out events carefully to manage the workflow● Make commitments to achieve 100% doneness during the Kaizen

How do you prioritize and focus?● Change activities● Leadership time● Leadership time● Project tasks and reaction

– Don’t start tasks until you are ready to execute to completion

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Focus is a controllable level for Throughput, speed, acceleration

Lesson 7: Exploit the Synergy of the ToolsLesson 7: Exploit the Synergy of the Tools

IMPROVEMENT SYNERGYSYNERGY

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First understand the problem, then apply the right solution

Lesson 8: Keep Leveraging Your StrengthsLesson 8: Keep Leveraging Your Strengths

InnovationInnovationInnovationPreviousPrevious Now & Going ForwardNow & Going Forward

InnovationInnovationGreat PeopleGreat People

Technical ExcellenceTechnical ExcellenceProblem SolversProblem Solvers

KeepKeepKeepKeep

InnovationGreat People

Technical ExcellenceProblem Solvers

Over-OptimismPush

90% DoneMulti task

Over-OptimismPush

90% DoneMulti task

Risk ManagementPull

100% Done

Risk ManagementPull

100% DoneMulti-taskAccept Waste

Heroic FirefightingTraveled Risk

Optional Participation

Multi-taskAccept Waste

Heroic FirefightingTraveled Risk

Optional Participation

100% DoneSerial-task

Eliminate WasteSound Planning

Leadership AlignmentM ti C it t

100% DoneSerial-task

Eliminate WasteSound Planning

Leadership AlignmentM ti C it t

TransformTransformOptional Participation

RationalizationIsolation

Traveled Work

Optional ParticipationRationalization

IsolationTraveled Work

Meeting CommitmentsBoeing Leverage

Business ExcellenceGreat Place to Work

Meeting CommitmentsBoeing Leverage

Business ExcellenceGreat Place to Work

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Don’t throw the baby out with the bath water

Lesson 9: Insist that Leaders Go FirstLesson 9: Insist that Leaders Go First

LeadershipLead change from the top down and inside out by modeling it, expecting it, being vulnerable and willing to change ourselvesvulnerable and willing to change ourselves

Motivation Create a culture of openness, confront the brutal facts and establish the existence of a burning platform

PassionPassion Engage your leaders in charting a course forward by developing the right continuous improvement vision & roadmap and over communicating it

Inspiration In ol e o r people b in esting in effecti e Lean training b incl ding their ideasInvolve your people by investing in effective Lean training, by including their ideas and engaging them on improvement teams

Focused Execution Set clear priorities, maximize the throughput of Lean improvements, and hold leaders accountable for removing barriers incentivizing the right behavior andleaders accountable for removing barriers, incentivizing the right behavior and monitoring business results

Learning OrganizationCreate an organization that is continually learning, improving, celebrating and striving to become a benchmark from which others can learn

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g

Strong leadership, determination, trust, inspiration, humility

Lesson 10: Apply Lean at 4 Organization LevelsLesson 10: Apply Lean at 4 Organization Levels

Level 4: EnterpriseGlobal Thinking full support for the best Enterprise solutions

PromoteDisallow

Global Thinking – full support for the best Enterprise solutionsPartnering – working and learning together to deliver resultsCollaboration – develop win-win solutions using dialog & inclusion Level 3: Value Stream

ExecutiveTeaming

SiloBehavior

Quality – pride in doing things right and not passing on defects Throughput – making value flow consistently to the customer Continuous Improvement – relentlessly eliminating wasteLevel 2: Team

Flow of Value

StatusQuo

Level 2: TeamTeams – natural work teams who maximize their contributionTeaming – people working together to meet commitmentsTeamwork – inclusion of diverse ideas toward the best solution

Inclusion& Teaming

Disrespect&Exclusion

Level 1: IndividualEngagement – motivated employees doing meaningful workPersonal Productivity – organized employees who get things donePersonal Growth – curious employees with a thirst for learning

Energize &

Engage People

Lack of Personal Growth Options

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“Lead by making others more powerful” – Ben Zander

Making Big Lean STICK – Top 10 LessonsMaking Big Lean STICK – Top 10 Lessons

1. Seed Your Lean Transformation2. Prioritize Quality and Throughput3. Cultivate First Hand Observation4 Make Everything Simple4. Make Everything Simple5. Make Everything Visible6. Manage All Types of WIP7. Exploit the Synergy of the Tools8. Keep Leveraging Your Strengths9. Insist that Leaders Go First9. Insist that Leaders Go First10. Apply Lean at 4 Organization Levels

A smart person learns from their mistakes

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A smart person learns from their mistakes A wise person learns from those of others

Favorite QuotesFavorite Quotes

ONCE YOU’VE CONVINCED ONE ENGINEER, YOU’VE CONVINCED ONE ENGINEERYOU VE CONVINCED ONE ENGINEER

LEADERS GO FIRST, EXCEPT WHEN THEY GO SECOND

AVAILABILITY IS NOT A SKILL SET

IT’S TOUGH TO TRANSFORM WITHOUT CHANGING

CHANGE IS A CONTACT SPORT

MY GUYS AT THE PENTAGON TELL ME I COULDN’T GET THAT DATA, WHERE DID YOU GET IT?!!

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Lean is…a journey, a way of life – have FUN and enjoy the journey !!

Driving Lean Transformation across a Matrix Organization in Product Development and One Off Productionin Product Development and One-Off Production

“Making Big Lean STICK”

K i N

Making Big Lean STICK

Kevin Naya

About KevinAbout Kevin

Kevin loves to do things that have never been done before that make a difference. He takes personal pride in helping to make Boeing and its talented people the best they can possibly be.people the best they can possibly be.

Kevin’s currently leads Lean across Boeing Space and Intelligence Systems. His executive leadership role is to align the leadership across programs, products and functions to most effectively improve enterprise performance.

Kevin has 22 years of experience in high-tech product development, primarily in the satellite industry Over the last five years he has been leading Lean andin the satellite industry. Over the last five years, he has been leading Lean and business transformation. Formerly the Deputy General Manager of a Boeing subsidiary, his role was to lead business transformation. Prior to that, Kevin worked as a management consultant and had various roles including the acting Chief Marketing Officer for a client’s new business venture. Earlier in his career at gHughes Space Company he worked on a handful of successful Government programs, including the GOES Weather Satellite and the Magellan Venus Radar Mapper. Kevin was a communication system engineer and a communication payload manager on a large program that received the NRO Gold Medal of Distinguished Performance and the David Packard Award the Department ofDistinguished Performance and the David Packard Award, the Department of Defense's highest award for acquisition.

Kevin holds a Bachelor of Science degree in electrical engineering from the University of Hawaii with an informal minor in bodysurfing. He earned a Master of Science degree in statistical communication from Stanford University and a Master

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of Business Administration from the Anderson School at UCLA.Kevin resides in Southern California with his wife and three children. His

hobbies include basketball, skiing and learning.