Unsold cars

If anyone thinks that the world's car manufacturers have been adopting lean in the last few years they can think again. The Guardian has some photos of car storage sites. Number six is the best.

The aim of the Toyota Production System is to 'produce cars at the rate of demand'. This means 'get an order, build a car, deliver it, get your money'.

A lean system should pull from the order. Dealers should have one or two examples of each model which are used for test drives and showing off features. When the order is made that should be the trigger to build the car, which should be delivered within a week.

There should be no question of manufacturers having fields full of cars or ever deciding to reduce or increase production. If there are fewer orders then there will be fewer cars made. The system flexes automatically.

In the seven wastes that lean people talk about - they are not applicable to service(!) - there is the waste of over-production. Taiichi Ohno thought that this was the worst waste of them all because it was the cause of many of the other wastes. What he would think of these pictures... (Interesting that there are some Toyota pictures in there. It doesn't say if they are already sold or not.)

Service is usually a bit different - you can't have fields full of mortgage applications pre-assessed before the customers come along - but you can still get bottle necks. You can still design a system that does not serve at the rate of demand. The "inventory" will more typically occur just after the order. There will have mortgage applications submitted by customers that are waiting to be looked at instead.

So, 'serve at the rate of demand' is still the game. Thus you must still have a fast, flexible system, that absorbs variety. More important you must understand your demand, for it is against that information that you design your system.

Best,

Rob

Who are the NHS really cheating?

There was a article this week that made me laugh out loud. You can read it in full here. But I will quote from two paragraphs near the end.

The survey found more people than in previous years believed they were listened to by doctors and nurses. But waiting times were longer. The proportion saying they stayed in the emergency department for no more than four hours fell from 77% in 2004 to 73% in 2008.

This might appear to show widespread flouting of the government's target for the waiting time in A&E to be no more than four hours for 98% of patients. But the [Healthcare Commission] said trusts often moved patients from A&E into a nearby "admissions unit". Patients might not be able to tell the difference in location, but time spent in an admissions unit did not count towards the four-hour target.

There is so much wrong with this situation. Error upon, incorrect assumption, upon invalid method.

Let's start at the beginning. Firstly, the practice of using surveys to find out of your service is performing well is deeply suspect. I read a report to say that customers who report that they are satisfied on surveys are just as, if not more likely to defect to another company than those who said they were not satisfied. Why? Well because more people want the survey to be over as quickly as possible and if they had bad service and were thinking of leaving why would they want to give the company more time than they needed to. Obviously with A&E you don't get too much choice about using someone else. But the principle of using surveys is still flawed.

Secondly, the article quotes a statistic that waits more than fours hours fell from 77% in 2004 to 73% in 2008. Where is the understanding of variation? Maybe both those figures are within the predictable range and nothing has changed. The four per cent difference might simply be from common cause variation. We can't know from the figures as presented.

Thirdly, the fact that they have a target of no wait being longer than four hours will be causing problems and in fact longer waits. We know that it is causing them to cheat since the commission itself explained that hospitals more people from A&E to "admission units" to avoid going over the four hours. And the "patients might not be able to tell the difference". Of course they can't. Waiting in one room is the same as waiting in another room and even more annoying if you have to get moved half way through. So even though they should not have the target in the first place, the Healthcare Commission is condoning the cheating that the target causes in order to meet the target. And the big laugh is they are still not meeting the target. We could speculate that the resources need to have an "admissions unit" and move people to it, might be better used in the A and E department.

And if you read the rest of the article you will see that 9% of people who asked for pain relief never got it.

Ouch!

Best,

Rob

Improvement is a Puzzle

I was listening to a podcast of a talk given by Russell Ackoff today and he talked about the difference between a problem and a puzzle. It is not about difficulty or anything obvious like that. The difference, Ackoff said, was that unlike a problem, there is something in a puzzle that means you have to change an assumption you have about it before you can solve it. (If you take this literally then they should be called "jigsaw problems" instead!) We've all done those puzzles where in order to solve them you have to change your thinking.

Which made me think that redesigning a system is a puzzle, not a problem because you have to change more than one assumption about how your organisation works.

The other interesting thing he talked about was the difference between analysis and synthesis. Analysis is where you take something that needs improving, fixing or understanding and you take it apart, examine (and perhaps improve) the parts then put it back together. With synthesis you start by understanding the bigger system that the system you are studying sits in.

He said that there are always important things about a system that you can only understand by synthesis and will never understand by analysis. For example, why do cars drive on the left in the UK? You may get an answer by looking at the history of transportation and the transportation system in general, but you will never get an answer by taking a car to pieces.

Similarly, you can juggle the internal processes of an organisation as much as you like, but if the barrier to improvement is in customer demand or in externally imposed targets or regulation, you need to look at the wider system and not just inside the organisation to understand these things.

Best,

Rob

What's In a Name?

That which we call a rose
By any other name would smell as sweet;

Shakespeare, Romeo and Juliet

And indeed changing the name of the rose would not change the affect it would have on our olfactory sense, but it may affect our attitudes towards it. Would it be as romantic to buy a dozen red Snozwangers for a loved one on Valentine's Day this year, even if the aroma was as pleasant as it ever was?

I just wonder because I heard recently that one of the big telecommunications companies in the UK has been renaming its entity model. That it is what the things are called in its enterprise wide IT systems. The thing that used to be called a "customer" is now called a "contract partner". Now I will admit that I do have a contract with my phone company, but I wold not call myself a partner. For starters I don't get a share of the profits. But the more worrying thing is how this change might shifts attitudes to customers.

You might argue that this is a very slight argument and you may be right. But just stop to think how we might treat these things. A customer: is served, valued and is "always right". A "contract partner" is something: to negotiate with, to sue for breach of agreement, to work with according to SLAs and service standards.

How would you rather be thought of by this company? And more importantly, when that company comes to discuss issues of purpose and value as defined by their customers, will the fact that they think of them as "contract partners" distort the outcome?

So thank you good reader textual informational absorber, see you next time.

Best,

Rob

Lean London NHS Seminar - 26th Mar 2009

There is a new Lean London event happening on the 26th March 2009. It is aimed at those in the NHS who are implementing or thinking of implementing Lean there. There will be case studies, some theory and a chance to meet others who are also interested.

Find out more and register to attend at http://www.leanlondon.org.uk/

Please tell anyone you know who might be interested.

See you there.

Rob