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Oct 5 2012

Art Byrne: Lean at its core is a very Strategic Thing

See on Scoop.it – lean manufacturing

“…Something that most people would look at clearly as a manufacturing thing, setup reduction, turns out that it’s going to give me lower cost and better customer service, two very strategic things…”

See on business901.com

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By Michel Baudin • Blog clippings 0 • Tags: Lean, Lean implementation, Lean manufacturing, Management

Ataturk teaching the latin alphabet in 1928

Oct 4 2012

Deming’s Point 6 of 14 – Institute Training on the Job

Note: The teacher in this picture is Mustapha Kemal Atatürk, founder and president of the Turkish Republic, in 1928. Until then, Turkish had been written in the Arabic script. Atatürk crisscrossed the country to personally introduce the Latin alphabet to notables in every town. At the end of his presentation, they had to choose a last name and write it on the blackboard in the new script. It may not have been on-the-job training, but it certainly is an illustration of training and of committed leadership. And it worked: 84 years later, Turkish is still written in the Latin alphabet.

Deming’s full, terse statement of his 6th Point is as follows:

“Institute training on the job”

“Institute” is stronger language that just “implement.” It is not just about making something happen, but  turning it into an institution. In the language of the 1980s, “on-the-job training” was synonymous with “sink or swim”:  as a rookie engineer, you were given projects, and it was up to you to figure out how to carry them out. Given that you had had your fill of classes in college, you didn’t mind. Production line operators received some mandatory orientations on things like safety gears, but relied on colleagues to figure out how to do their work. So, what was Deming talking about?

Deming’s elaboration on Point 6 actually drops the “on-the-job” and is entitled just “Institute training.” In it, explains that it is about “the foundations of training for the management and for new employees,” as opposed to continuing education. Regarding management, he points out that Japanese managers “start their careers with a long internship (4 to 12 years) on the factory floor and in other duties in the company,” implying both that it is systematic in Japan, and not done anywhere else. I once worked with a Purchasing manager in a major Japanese company who had five spent years in Design Engineering (See  Point 4), and this was part of a number of rotations preparing him for senior management positions. However, it was not systematic, in that not all professional employees went through this process.

This practice is also predicated on long-term, committed employer-employee relationships. It trains managers who know in depth how the company works and have personal ties to many of its departments, but are not necessarily at the top level of expertise in any of their specialties, and it does more to enhance their value to the company than their marketability outside of it. Similar practices are also found outside of Japan, in companies like Boeing, GM, or Unilever, for young employees identified as having “executive potential” (See Alternatives to Rank-and-Yank in Evaluating People). In Italy, I had the opportunity to work with a production supervisor in a frozen foods plant who was a young German engineer in such a program. The parameters and the management of these programs matter. They may degenerate, for example, if the time spent in each position is too short and if participants are rewarded for not making waves.

Here again, Deming is at odds with Drucker. The rotation of managers to be seasoned in the specifics of the company’s business before being promoted is contrary to Drucker’s concept of a professional manager who can run any business, and more in line with the practices of the military. When, at the end of The Practice of Management, Drucker discusses the preparation of tomorrow’s managers, which he sees as a combination of a “liberal education for use,” centered on classics and on a “basic understanding of science and scientific method,” supplemented by continuing education in advanced techniques of management. In his view, managers need to respect technical workmanship in the activity of the company, but they don’t need to possess this workmanship themselves, and their generic management skills are transferable across industries. At Apple, Steve Jobs would probably have agreed with Deming; John Sculley, with Drucker.

Deming says little on how shop floor operators should actually be trained, and  makes no reference to Training-Within-Industry (TWI), a program we would have expected him to be familiar with as a development that was contemporary to his own work in World War II, but a  Google search for “Deming +TWI” does not match any document. He bemoans companies’ failure to use people’s abilities but does not explain how training, on the job or otherwise, can remedy this.

Deming also says that training should be focused on the customer’s needs, which, influenced by TQM, we may interpret as meaning the next process.   When Deming writes “customer,” however, he does not mean it metaphorically but literally. He is actually thinking of the real customer, the one who pays and has the option to buy elsewhere. In other words, training must relate the work done at any workstation to the experience of the end user of the finished product. The farther upstream from final assembly, the more remote the connection and the more challenging it is to communicate, but the more understanding an operator has of the effect of the work, the stronger the motivation to do it well.

Even in the best companies today, much of the initial training of operators is done off-line rather than on the job. The basic employee orientation on company procedures or personal protection equipment is, of course, done offline, but so is a major part of the work itself. Machinists learn the basics of CNC turning with tabletop lathes that carve wax cylinders before moving on to actual machines, and assembly teams learn the basics of the Kanban system through simulation games.

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By Michel Baudin • Deming 6 • Tags: Deming, Management, Quality, Training, Training Within Industry

Oct 2 2012

A Lean Journey: Meet-up: Michel Baudin

See on Scoop.it – lean manufacturing

Interview on Tim McMahon’s A Lean Journey.
See on www.aleanjourney.com

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By Michel Baudin • Blog clippings 0 • Tags: Cellular manufacturing, Continuous improvement, Data mining, industrial engineering, Kaizen, Kanban, Lean, Lean implementation, Lean Logistics, Lean manufacturing, Management, Manufacturing engineering, Quality, Toyota, Toyota Production System, TPS

ATC Trailers shop floor

Sep 26 2012

Video on Lean at ACT Trailers

This morning, I received the following email from a manufacturer of trailers in Indiana, with a link to a Youtube video they produced for their dealers. It is a good case of organizing production around the demand structure. At the end of the video, they acknowledge Bill Waddell for his help. Here is the full message:

From: “Lucas Landis” <LucasL@aluminumtrailer.com>
To: “Michel Baudin” <michel.baudin@takttimes.com>
Cc:
Subject: RE: Context of your video
Date: Wed, 26 Sep 2012 08:08:09 -0700

We are a 13 year old company that manufactures specialty trailers in
Nappanee, IN. As with a lot of manufacturing plants during the end of
the last decade, our company went through a terrible austerity period –
employees were laid off, the CEO was replaced, and a myriad of other
radical decisions were made as a result of the downward economy. Out of
the ashes of that, the founding CEO of the company had been doing a lot
of research on LEAN manufacturing. Because we were more or less
starting over, Steve Brenneman (CEO) decided to implement the LEAN
philosophy to maintain a more sustainable company that could avoid
future pitfalls and offer a more superior product. We are now into our
3rd year of our LEAN Journey and this video
http://www.youtube.com/watch?v=HpysKrqYxCI documents our Value Stream
process. We created this video to help our Dealers understand our
business philosophy and system. Following a previous Kaizen event, we
are in the process of taking LEAN to the front end of our business,
which means getting our distributors in-line with our process. The
video should explain the rest.

Hope that helps.

Lucas Landis
ATC TrailersMarketing
Phone: 574-773-8341
Fax: 574-773-7769
mailto:LucasL@aluminumtrailer.com
http://AluminumTrailer.com

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By Michel Baudin • Personal communications 0 • Tags: Lean assembly, Lean implementation, Lean manufacturing, Value Stream

Sep 26 2012

Harley Goes Lean to Build Hogs

See on Scoop.it – lean manufacturing

American manufacturers including Harley-Davidson have embraced flexible production and hiring that have lessened their risks of a sudden drop even if the economy slips into a deep slump.

See on online.wsj.com

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By Michel Baudin • Press clippings 0

Entrepreneurial Nation cover

Sep 24 2012

Ro Khanna’s Entrepreneurial Nation

The title misleads, because the book is not about entrepreneurship but about the state of manufacturing in the US. Fortunately, the subtitle is more descriptive: “Why manufacturing is still key to America’s future.” Thinking about entrepreneurship in 2012, the first companies that come to mind are Google, Facebook or Amazon, who do no manufacturing, or Apple, which subcontracts it. Several of the executives described are in fact entrepreneurs, but you also encounter regular managers and fifth generation heirs running family businesses. I don’t blame the author for this, as I suspect the title was chosen by marketers who thought that entrepreneurship would sell better than manufacturing.

The author’s bio on the book jacket describes him as “former deputy assistant secretary of commerce,” a title that leaves you wondering what he was actually doing. You have to look up his LinkedIn profile to find out that his primary function was to boost exports of manufactured goods. Until then, he was an intellectual property lawyer. To his credit, he makes no claim to having any particular knowledge of manufacturing before he started. But he clearly fell in love with the subject, and a passion for it shows through in his writings.

The book contains facts, interpretations of these facts, and policy recommendations. Crisscrossing the country for the commerce department enabled the author to visit many companies and meet outstanding leaders in steel making, aeronautics, mining machinery, defense, and other manufacturing industries. I had not heard about many of them and learned from the author’s account of these visits.

The author quotes many sources, and his position gave him the opportunity to be tutored by industry icons like Andy Grove. Nonetheless, I find his analysis of the situation lacking in depth and originality. I agree with his fundamental point that the Federal Government of the US should have a policy about Manufacturing, and that it makes no sense to have a cabinet-level Secretary of Agriculture and no Secretary of Manufacturing when Manufacturing is a much larger component of the economy.
His argument that government’s involvement in manufacturing is a long American tradition is based on a report by Alexander Hamilton as Treasury Secretary in 1791 arguing in favor of it. Khanna quotes it many times, but makes no reference to the role played by Thomas Jefferson in launching the multi-decade effort to make interchangeable parts, that the embryonic private sector of his day would not have undertaken, but that gave birth to the machine-tool industry and became key to the emergence of mass production in the 20th century. But his key point is valid that the government has a 200-year tradition of pitching in where the private sector can’t or won’t.

One argument that Bill Clinton makes but Khanna doesn’t is that none of the advanced economies in the world have developed on pure laissez-faire. The US hasn’t, and neither have Japan, Germany, the UK, France, Italy, or Canada. The visible hand of government plays some role everywhere. The question is what that role should be. Just because the government of another country intervenes in the economy in a particular way doesn’t mean we should do it too. Khanna appears to have yet to meet a government program he doesn’t like; to him, they are all underfunded and their budgets should be increased, and I have to disagree on some of them.

He asserts, for example, that the Manufacturing Extension Partnership (MEP) is a great program that does not “pick winners and losers.” Through this program, the federal government has been subsidizing consulting firms in all 50 states to provide services at reduced rates to small and medium-size enterprises (SMEs). In so doing , the government may not pick among the recipients but it certainly does among providers. And the MEP program is run by NIST, the agency in charge of standards for weights and measures. It is run by managers who have never worked in factories and you wonder how they can select consultants. It is, however, exactly what NIST does, and, thereby, creates unfair competition to other consultants.

Khanna also makes the common confusion between having a strong manufacturing sector in the economy and having a large proportion of the work force involved in manufacturing. Most manufacturing jobs in the US today are still the kind of repetitive assembly line work that no child dreams of doing as a grown-up. The future is in the current minority of jobs that involves programming and maintaining machines. It is a slow transition that has been underway for decades and has already seen, for example, the number of employees needed in a steel mill drop by a factor of 10 in forty years. It still has a long way to go but the direction is clear. It is a process that moves like a glacier, not a tsunami, with the consequence that it can and should be planned for. The strong manufacturing sector of the future employs a small number of highly skilled people. The jobs are more desirable that traditional manufacturing jobs, but in much smaller numbers.

The book paints China as an enemy, at war with US manufacturing. But the Chinese I know are focused on pulling >1 billion people out of poverty, not putting Ohio machine shops out of business. We will do better if every way if they succeed and become consumers than if they stumble and China reverts to the chaos of 40 years ago. In a truly emerging economy, labor costs rise with the skills of the work force. As local companies develop their own intellectual property, they also become more sensitive to others’ and counterfeiting declines. Finally, as incomes rise, so does the demand for imports.

While GE’s reshoring of appliance production in a happy ending for Louisville, KY, the story makes you wonder what the executives had been thinking when they outsourced in the first place. Why did they wait until they had actually moved production to Mexico and China and wrecked Louisville before assessing the full economic consequences of these decisions?

The book is about success stories. In a context where so many are writing off the US manufacturing sector, Khanna wants to show how it can be successful, and it is understandable that he would not dwell on failures. One that he could not avoid, however, is Solyndra, because it is a case in which the government made a mistake, even if the mistake was made by a department other than the one Khanna worked for. He talks about “the lessons of Solyndra” but does not say much about what these lessons are. You shouldn’t overinvest, but you already knew that.

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By Michel Baudin • Book reviews 0 • Tags: Government, Manufacturing

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