Sunday, September 9, 2012

Kaizen - Customer = Waste

Now that I have your attention I'd like to describe a situation where I personally observed a well-meaning Kaizen that did not involve the customer.  And I'd like to show you how it turned out to be a complete waste of time for all involved.

For those of you not familiar with the selling process that most implementation based consultants go through it generally involves something called an Assessment or Analysis.  This is an exercise that the consulting firm performs, usually at their own expense, intended to scope out the project and convince the client that the firm is up for the challenge.  Assessments can take anywhere from a few days to a few weeks to complete depending on the size of the potential engagement.  And at the end of the exercise it is obviously the hope of the consulting firm that they present a compelling enough case to convince the client to buy the project.

The firm where I first worked has a rigorous approach to how they performed a two-week Analysis.  In fact they had the process down to a science where each hour of each day was carefully scripted out.  And the only decision the lead analyst had to make was where to schedule the various studies.

The other thing you need to know about these assessments is they are gruling for the consultants involved.  In fact if a consultant does not work a minimum of 20 hour days conducting and writing up their studies then the firm doesn't feel that the analyst is doing their job properly.  I actually had a partner explain to me that a big part of the assessment is demonstrating to the potential client "just how hard we work."  I noted that the partner usually only popped in and out during the day to see how the assessment was going.

So back to the Kaizen.  As I mentioned a huge part of the effort for the consultants was the time it took usually back at some dingy hotel room to manually write up their studies.  An 8 to 10 hour study could take half as long again to write up.  And if the analyst was feeling particularly grouchy they could make you re-do much or all of your work again.  This colosal waste of time was definitely not lost on bright young minds fully capable of generating masterpieces on Excel or PowerPoint.

That was how the studies were being done when I left the firm almost 10 years ago - long hours spent manually writing out the studies and filling in the graphs with coloured tape.  Then about 4 years ago I had the opportunity to work with a spin-off firm that was basically a pale shadow to the firm where I had originally started.  One of the things I noticed on my first analysis was the fact that spreadsheets and colour printers were now being used to write up the studies.  Apparently this was a process improvement (Kaizen) that the original firm had finally given in to.

I was happy to see that even a process improvement firm could look at its own process and make improvements.  And my immediate assumption was that the length of the assessments must be similarly cut in half.  My mistake.  Apparently all the firms had done was take the additional time available to the consultants working 20 hours a day and assigned additional studies to be completed.  That meant it still took two weeks to compile the findings.  And in the final presentation there were almost twice as many studies taped up around the board room table.

So what's the problem?

Well those of you who follow my blogs and tweets will know that I am passionate about the importance of starting every Lean exercise with having the customer define value.  My point being you may have your own internal perceptions of what adds value and what does not.  But at the end of the day the only person's perceptions that matter are those of the customer.  Despite this I still read blogs and watch pod casts from Lean "experts" who rarely if ever even mention their client's customers.

Take the consulting firm for who I used to work and for whom I have to thank for bringing me into the world of management consulting.  They were right in looking at their own internal process to find ways to reduce waste and add more value.  However by ignoring their customer, they automatically assumed that writing up studies was somehow adding value.  They came up with a method change to reduce the time required to complete this task.  However rather than leaving the number of studies the same and reducing the time they took to complete these highly intrusive assessments, they simply maintained the two week cycle time and piled on more colourful graphs to show at the end.  That's like Toyota designing a clever way to reduce inventories of parts in one location, only to store more parts in the freed up space.

What's even more interesting is I noted that the final presentations to the clients often only focused on a small percentage of the completed studies.  This was because there were simply too many to go through in the time allowed by the busy clients.  The untouched studies were waste in their purest form.

As an interesting aside I had the opportunity to conduct a full assessment at a potential client in just two days.  We only had two days because that was all the interruption (waste) the client would allow.  One other consultant and myself were able to conduct multiple simultanious studies covering all critical aspects of their process.  We were then able to write up all the studies on computers and give a full presentation to the senior executives the afternoon to the the second day.  The point being the client was telling us that to him our studies were waste.  So we utilized the results of the previous Kaizen to shorten our cycle time and minimize as much waste as possible.  I am also happy to report that I remain an advisor to that client to this day.

@leanmind

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