Category Archives: Lean

Improve performance without performance dashboards

Can you improve performance without operational dashboards? As a consultant, I regularly speak with team managers about their team’s improvement efforts, or the lack of thereof. One cause of stalling improvement that keeps popping up is: “I don’t have accurate data. I can’t do anything about team performance without accurate data.” Of course, performance dashboards can be important for many reasons, for one to give focus to your improvement efforts. But is the absence of performance dashboards a reason not to improve? It doesn’t have to be.

An operational team should be given the responsibility to improve their work on a daily basis. Improvement should be their habit. It should feel weird not to be experimenting at any given time. This works best with autonomous teams, which work together on one common daily goal. The Toyota Kata has taught us that these teams should do frequent, small scaled experiments. And that it is equally important that the team learns from each experiment, as that the performance actually improves.

To start improving, a team needs time (a bit of overcapacity is needed to improve), and direction. The direction – what should the team’s improvement efforts focus on – could be derived from operational dashboards. But, often just as well, the direction could follow from a vision, translated into ‘target states’ (see The Toyota Kata). In Lean companies, the vision would be translated through ‘policy deployment’ or ‘hoshin kanri’ in Japanese, other companies would use for instance year-plans.

With time and direction in place, all a team needs is resourcefulness and a whiteboard. Well, you could do without a whiteboard, but in my experience it’s a great tool for improving and experimenting.

As a manager, ask your teams to start improving with what they know now. In parallel, you can work on perfecting your operational dashboards. Don’t wait for perfect dashboards. Start improving today.

 

Menno R. van Dijk.

Less management through Super7 – autonomy reduces the need for management

Can you run a bank with less management? If you would remove one layer of management from a large financial service organization – let’s say a bank  – would that organization be less effective? And with two layers of management removed: would a bank need to be rescued with taxpayer’s money?  My recent experience with customer focused, autonomous Lean teams at a Dutch retail bank have taught me:  Super7 Operations (see my book: Super7 Operation – the Next Step for Lean in Financial Services) requires Less Management, More Delegating.  It may be too much to claim that two layers of management can be removed, perhaps not even one entire layer, but the span of control of one manager can dramatically be increased. And yes, that means a lot less managers. So why is that, what type of management tasks are eliminated by using small autonomous lean teams?

Less Capacity Planning

“Is it okay to take a day off next Tuesday?”.  In the old days, managers spent a lot of time planning the capacity of the team. Especially in preparation of the holiday season or in the summer period. An autonomous Lean team will take care of this planning themselves. And they make sure that they have sufficient capacity to get the forecasted amount of work done.

Less Management of Inventory

Prior to Super7, work needed to be booked in an inventory management system, and the age of the inventory (when did we receive the customer request?) needed to be monitored and compared to the Service Level Agreement (SLA). Then, if the system says ‘Orange light, i.e. ‘we’ve got only one day left within SLA’, priorities needed to be reshuffled urgently to prevent ‘Red Light’ the next day.

Less Management of Assigning Work

Because there is a lot of work in inventory, team managers attempted to get the ‘best work streams’ assigned to their team. The norms for each work stream differed; moreover, not all norms were set as accurate.

Less Management of skills

In the past, a Daily Production Meeting was held, in which the team managers, all together, determined which team would be doing which work streams the next day. In Super7’s, this whole circus isn’t needed. Each Super7 knows what work they will be doing: the same work every day, and all work that came in that day.

Less Management of Work In Progress

Before Super7, a manager needed to check the inventory system: is the work still waiting, or is it work-in-progress? A manager also needed to look in the report of the Daily Production meeting: where was the work assigned to? Finally, a request had to be distributed to the individual employees.

Let’s remove management layers!

Menno R. van Dijk.

40% flexibility in capacity to cope with fluctuation: Super7 Operations

Just how flexible is an Operation that is organized in Super7 teams?  40%. Super7 Operations can cope with a difference of 40% between a quiet day and a busy day.

From the many examples in day-to-day operations, we know that Super7 Operations increases the flexibility of a back-office. Impressive results have been achieved with this over the past few years, in many operational departments of large financial service providers.  Examples of this can be found in my book: Super7 Operations – the Next Step for Lean in Financial Services.  

Recently, one of my clients asked me to calculate just how flexible a team will become. How much can the daily demand fluctuate when working with no customer queue when the team works as a Super7?  An alternative could be replacing a part of the employees with flexible contractors: so called min-max-contractors, who work between 20 and 40 hours per week depending on demand. Could the same flexibility be achieved with Super7 Operations?

From experience, we know that a Super7 team is able to work one hour longer on busy days. The end time of the working day is flexible, and the members of a Super7 team make arrangements among themselves when one of their team has obligations preventing him/her to stay longer that day. Next to that, we’ve measured 5 to 15% higher productivity as well when the pressure is on. And, these extra hours are compensated by leaving early on quiet days, which means no extra hours to pay. This results in the following graph, showing the 40% flexibility:

 

Super7: flexibility to cope with fluctuation

Super7: flexibility to cope with fluctuation

Next to this, our analysis showed that Super7 Operations delivers greater flexibility than replacing 20% of your people with min-max contractors.

Naturally, things like team meetings and training are done on quiet days, and when they are planed on busy days they are rescheduled. This results in up to 20% lower ‘availability for productive work’ on quiet days – but this can be achieved without Super7 as well (we’ll call this scenario 1).

20% min-max contractors give you the flexibility to ask 20% of your workforce to stay longer or leave earlier, as long as you stay within the 20 to 40 hours per week range.  (This is scenario 2)

Super7 Operations is our Scenario 3

To be complete, we added a fourth scenario: Super7 Operations and replacing 20% of the employees with min-max contracts. 

The graph below shows these four scenario’s next to each other.

 Flexible capacity in 4 scenarios 

Surprising results, don’t you think?

Menno R. van Dijk.

 

 

Improvement Kata and Coaching Kata: Improvement as a habit

 You can make improving into a habit by practicing the improvement kata and the coaching kata over and over again. Kata (かた) is a ‘style’ of martial arts, aimed at perfect execution of the movements through repeated practicing (“paint the fence, Daniel-San”). By practicing often the routine becomes a habit – you can do it without having to think about it. Learning to drive a car is also an example of this principle: at first, you really need to think about what you doing, and after a while you do it thoughtlessly.

 For Super7 Operations, the combination of the Improvement Kata and the Coaching kata works like charm:

 
  • Improvement in small increments
  • Weekly improvement activities
  • Learning something every week
  • Managing output, not what the team is doing
  • Coaching on improving 
  • A true learning organisation

 Below, I explain how this works in 4 illustrations:

1. The Improvement Kata: weekly experimenting  is the Super7s’ habit

 

Improvement Kata: weekly experimenting is the Super7s’ habit

Improvement Kata: weekly experimenting is the Super7s’ habit

2. Coaching Kata: Team managers create movement by asking the right questions – steering on output, coaching on improvement

Coaching Kata: Team managers create movement by asking the right questions - steering on output, coaching on improvement

Coaching Kata: Team managers create movement by asking the right questions – steering on output, coaching on improvement

3. Improvement Kata: weekly experiments are the habit of team managers – leading by example

Improvement Kata: weekly experiments are the habit of team managers - leading by example

Improvement Kata: weekly experiments are the habit of team managers – leading by example

4. Coaching Kata: Department manager forms the fundament of the Learning Organisation, steering on output and coaching  improvement

Coaching Kata: Department manager forms the fundament of the Learning Organisation, steering on output and coaching improvement

Coaching Kata: Department manager forms the fundament of the Learning Organisation, steering on output and coaching improvement

More on Super7 Operations can be found in my book: Super7 Operations – The Next Step for Lean in Financial Services.

 

Menno R. van Dijk

More on Improvement Kata for Lean Super7 Operations

As described in earlier posts, Kata coaching and the Improvement Kata are especially useful in the implementation of Super7 Operations. As you know, the theory and examples of Kata coaching can be found on www.lean.org/kata or in the excellent books and you-tube posts of Mike Rother. In this blog post I’ll explain the Improvement Kata in more detail.

Traditional improvent is project based – see figure 1.

figure 1 - the old way of improving

figure 1 – the old way of improving

The Improvement Kata doesn’t plan the whole route: only the next target condition is clearly defined. See figure 2.

Figure 2 - the Improvement Kata

Figure 2 – the Improvement Kata

The Improvement Kata doesn’t tell you how to get to the next target condition, let alone how to get to your desired situation. It doesn’t tell you which steps to take to reach this year’s target. The Improvement Kata lets you discover the route as you go. See figure 3.

 

Figure 3 - finding the path to improvement

Figure 3 – finding the path to improvement

The improvement Kata is a radically different approach to improvement. It does however show strong similarities to Agile or Scrum software development – but, the improvement Kata is applied on the shop foor, not in project teams or development teams. For me, it’s the best way to get to a true learning organisation and continuous improvement. And only a learning organisation that can improve continuously is capable to cope with the ever changing demands of customers, especially in the current market for Financial Services.

 

Super7 Operations - the Next Step for Lean in Financial Services ; a book by Menno R. van Dijk

Super7 Operations – the Next Step for Lean in Financial Services ; a book by Menno R. van Dijk

Menno R. van Dijk.

Super7 Operations - The Next Step for Lean in Financial Services

Parallels between Smart Simplicity and Super7 Operations

There are several parallels between Yves Morieux’s Smart Simplicity and Super7 Operations – the new way of applying Lean in financial services.

Last year, I had the privilege to attend a seminar on Smart Simplicity by BCG Fellow Yves Morieux.  He explained that complexity and lack of cooperation is the common root cause to low productivity and low employee morale. He passionately explained how this works and how Smart Simplicity is the answer.  Now, you can hear his theories for yourself, in his – highly recommended – TED talk, available on youtube (link – be warned, you may be buying a second TV after watching it).  After hearing his story, I realized that there are parallels between Smart Simplicity fit in with Super7 Operations.

Below, I give you my interpretation of Smart Simplicity. Please refer to the works of Yves Morieux for the original (Harvard Business Review, BCG, TED):

Traditional organizational design, with its focus on the hard (structure, systems, etc.) and the soft (human relations, positive emotions, etc.) is obsolete. Instead, you should use the Six Smart Rules of Smart Simplicity. First rule is that you should understand what people really do, where they spend their time on. The second rule is that you should reinforce integrator or in other words make managers true integrators by removing as much layers of management as possible.  The third rule states that you should empower as many people in your organization, thus increasing the total amount of power within your organization. The fourth rule tells us to create feedback loops that show people the effect of their behavior. The fifth rule is that we should increase reciprocity by removing buffers of self-sufficiency. Get rid of all the second TV’s in your organization. The last rule tells us to reward those who cooperate and blame those who don’t.

As said, there are several parallels between Smart Simplicity and Super7 Operations:

  1. The first parallel is cooperation. In Smart Simplicity and in Super7 Operations, cooperation is the key to increasing productivity and employee morale. Where Super7 Operations focuses on cooperation between operational employees, Smart Simplicity advocates cooperation between functions and departments.
  2. Second parallel is reduction of management layers. Super7 teams are highly autonomous, which means that less management is needed. In recent implementations of Super7 Operations, significant reduction of management was realized. And the second rule of Smart Simplicity is to reinforce integrators – Give managers (these are the integrators) discretionary power and interest to make others cooperate. And, according to Morieux in his TED-talk, this often means reducing management layers.
  3. The third parallel is delegation and empowerment. Super7 teams get as much power as needed to help their customers. Handovers are eliminated, because the Super7 team can do everything within the team.
  4. The fourth parallel is rewarding cooperation. Super7 teams are steered on output, but individuals are rewarded for cooperation.

In summary, Super7 Operations and Smart Simplicity share several principles. Where Super7 Operations applies these bottom-up, starting on the shop floor of Operations Departments in Financial Services, Smart Simplicity is gives us a more holistic, strategic redesign approach. But the two don’t bite each other. Sometimes, it’s better to start small, to start bottom up and then gradually extend the same principles to the whole organization. In these cases, Super7 Operations may be easier to start with. And in other cases, Smart Simplicity is needed to redesign change entire value chains and to improve cooperation on interdepartmental level.   

Menno R. van Dijk.

Visual Management for Teamwork – the Team Board

Visual management creates the openness and transparency that are essential for Lean teamwork. Each Lean Team should have a team board, to my opinion. In true Lean companies this is common practice, but in Financial Services I have encountered Lean teams without one. Not so in one department that I helped with the introduction of Lean, or more specifically, a Lean way of working tailored for Financial Services – Super7 Operations.

The benefits that we found from the use of team boards are:

  1. Team pride. Teams are proud of what they achieve, and of the improvements they have made. In this department, each Super7 team chose a team name – often a bit tongue-in-cheek – that was displayed at the top of the board. Often with pictures of the team members matching the theme of the team name.
  2. Output management: Each team shows their progress against the daily target, updated 4 times per day. The manager can see where help is needed, even before the question for help has been asked.
  3. Continuous Improvement: Each team shows the Kata-improvement or the experiment that they conduct that week. And some teams include an improvement idea list for improvements that go beyond their own team scope – which for instance the IT department can work on.
  4. Learning. Weekly dashboards are displayed on the boards, and ‘red lights’ are celebrated as improvement opportunities. And the evaluation of Kata-improvement actions is also displayed on the board: “what did we learn from this experiment?”
  5. Open and Transparent culture. Teams have nothing to hide from each other, from the management or from visitors. All results, good or bad, are displayed with pride. Good results as successes, bad results as learning opportunities.

If you are familiar with the use of team boards in production or assembly plants, as is explained in detail on www.lean.org, these benefits won’t be surprising. The question remains, however, why there are still lean teams in Financial Services that haven’t adopted this best-practice.

More information on Super7 Operations can be found in my book: Super7 Operations – the Next Step for Lean in Financial Services.

My book explains the theory of Super7 Operations in detail as well as giving practical guides for implementation of Super7 Operations in the detailed case studies. You’ll get valuable tips and tricks for implementing Super7 in your own organization, from the people that have done it before you.

Menno R. van Dijk.

Super7 Operations - The Next Step for Lean in Financial Services

Kata Coaching in practice of Lean Super7 Operations: keep it simple

Kata coaching has successfully been used in practice, in organizations that have adopted Super7 Operations. One important lesson: keep it simple, keep the improvement steps small.

Recently, Super7 Operations was introduced at a debt management department. The team managers responded very well to the step-wise improvement method of Kata. However, they sometimes found it difficult to accept that the goal for next week would be anything less than reaching the desired condition. This lead to too many actions on the action list, that couldn’t all be finished within one week. To my opinion, this one-week rhythm is essential for maintaining momentum in the early stages of development of Super7 Operations. The lesson that we learned is to keep the improvement-kata simple: one action in one week, one experiment, one problem to solve. The improvement steps may seem small, too small perhaps, but in our experience this is in fact the maximum improvement pace for the organization.

The Kata Coaching Questions (my own free interpretation – please refer to www.lean.org/kata for the standard):

  1. What does perfection look like to you on this element of Super7 Operations?
  2. How does the current situation look like?
  3. Where do you want to be next week on the development of this element of Super7 Operations? And what obstacles are preventing you from being there now?
  4. What action or experiment will you take to get to where you want to be next week?
  5. What do you expect from this action?
  6. When will be able to evaluate what you have learned from this action or experiment?

 

 Theory and examples of Kata coaching can be found on www.lean.org/kata or in the excellent books and you-tube posts of Mike Rother.

Super7 Operations - making it work

Soft Skills for cooperation in Super7 teams

What soft skills are needed for cooperation in Super7 teams – what soft skills are essential for a team to reach cooperational excellence? The implementation Super7 Operations (link) within the operations departments of one of the leading Dutch retail banks is in full swing. Many things need to be taken care of in the preparation phase: small, autonomous production teams (Super7’s) arent’ formed overnight. But one thing in particular is essential for a smooth introduction of Super7 Operations: attention to the soft skills that are needed for working together in a small, autonomous team.
In our experience, the most important soft skills for cooperation in Super7 teams that required training in preparation of Super7 Operations are:
1. Giving and receiving feedback
2. Understanding the development of autonomous teams
3. Effective meetings and making decisions as a team

Let’s look at these subjects in a bit more detail:
1. Basics of giving feedback
• Describe what behavior you have observed
• Explain what effect this behavior has on you
• Check if the person you give feedback understands you
• Indicate what behavior you would like to see

2. Basic development steps of autonomous teams
• Phase 1: group of individuals
• Phase 2: a developing team
• Phase3: a cooperating team
• Phase 4: an autonomous team, striving towards cooperational excellence

4. Basic elements of effective meetings and making decisions as a team
• Use team roles in meetings: chairperson, time keeper, voice-of-the-customer
• Make sure all items on the agenda are well prepared
• Assign a fixed amount of time to each item on the agenda
• Start with giving all participants the chance to say something about the subject – finish the initial round before starting the discussion
• Use a white board or flipchart to write down the most important points
• Keep the focus on solutions and improvement ideas
• Make sure everybody gets their say
• Keep the discussion focused
• Don’t take minutes, write down actions (what, who, when)

For the team managers, the change from traditional Operational Management to Super7 Operations can be even more dramatic than for the team members themselves. More on this change and the required skills for managing Super7 Operations can be found in my book: Super7 Operations – The Next Step for Lean in Financial Services. More information about this book can be found on www.super7ops.com

How to apply Kata Coaching in implementation of Lean Super7 Operations

 

Kata coaching is especially useful in the implementation of Super7 Operations. The theory and examples of Kata coaching can be found on www.lean.org/kata or in the excellent books and you-tube posts of Mike Rother. Recently, I’ve applied Kata coaching during an implementation project of Super7 Operations.  Every week, I used the Improvement Kata questions to challenge the team managers to make one improvement step on each of the 7 principle elements of Super7 Operations. And in turn, the team managers have used Kata coaching questions to get their teams to improve. The effect of applying the Kata coaching questions to the 7 principles of Super7 Operations was impressive: not only did this lead to exiting improvement experiments on the shop floor, but it had a profound effect on morale as well.  I have found that Kata coaching is an effective way to get and keep things moving towards the desired direction. It just isn’t possible to implement perfection in one blow, and this isn’t any different for Super7 Operations.

The 7 principles of Super7 Operations:

The 7 principles of Super7 Operations

Principles of Super7 Operations

  1. Customer is central: The Super7 team has a goal that is relevant for the customer.
  2. Flexibility in skills and capacity
  3. Team manager steers on output and is supportive to the Super 7 team
  4. Daily rhythm and quick response to disruptions
  5. Super 7 team is autonomous in work distribution and in imporving the way of working.
  6. Continuous improvement of performance, supported by planning and forecasting.
  7. Visible management to create openness, transparancy and Super 7 team pride.

 

The Kata Coaching Questions (my own free interpretation – please refer to www.lean.org/kata for the standard):

  1. What does perfection look like to you on this element of Super7 Operations?
  2. How does the current situation look like?
  3. Where do you want to be next week on the development of this element of Super7 Operations and, what obstacles are in your way?
  4. What action or experiment will you undertake to get to where you want to be next week?
  5. What do you expect from this action?
  6. When will be able to evaluate what you have learned from this action or experiment?And afterwards:
  7. What did you learn from this action / experiment
  8. …start again at step 1

 More on Super7 operations can be found in my book: Super7 Operations – the Next Step for Lean in Financial Services.

Super7 Operations - the Next Step for Lean in Financial Services ; a book by Menno R. van Dijk

Super7 Operations – the Next Step for Lean in Financial Services ; a book by Menno R. van Dijk