A3 Management: Effective Problem Solving via PDSA

Webinar July 3, 2014 A3 Management: Effective Problem Solving

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© 2014 The Karen Martin Group, Inc. 3  Consultant / Coach / Facilitator / Trainer: Lean transformation & business performance improvement in all industries.  Teacher: University of California, San Diego  Author & Speaker: Karen Martin, President @KarenMartinOpEx 2013 Shingo Prize winner! www.ksmartin.com/subscribe 50% off for limited time on Amazon!

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© 2014 The Karen Martin Group, Inc. 6 You will learn… • The mechanics of using PDSA (plan-do-study- adjust) for solving problems. • The vital role coaching plays in building organization-wide problem solving capabilities. • How to break the “telling” habit that disrespects a worker’s creative potential. • How to systematically build coaching capabilities to accelerate learning.

© 2014 The Karen Martin Group, Inc. 10 Continuous Improvement New Problem 50-80% of the total time Detailed Steps 1. Define and break down the problem. 2. Grasp the current condition. 3. Set a target condition. 4. Conduct root cause & gap analysis. 5. Identify potential countermeasures. 6. Develop & test countermeasure(s) 7. Refine and finalize countermeasure(s). 8. Implement countermeasure(s). Study Evaluate Results 9. Measure process performance. 10. Refine, standardize, & stabilize the process. 11. Monitor process performance. 12. Reflect & share learning. Adjust Do Clarifying the PDSA Cycle Plan Develop Hypothesis Conduct Experiment Refine Standardize Stabilize Phase

© 2014 The Karen Martin Group, Inc. 11 The Purpose of PDSA: Effective Problem Solving • Provides a methodical structure to improve results. • Breaks the habit of being unclear about what the problem actually is. • Breaks the habit of jumping to solutions. • Develops fact-based decision making. • Develops deep critical thinking skills.

© 2014 The Karen Martin Group, Inc. 13 A3 Management drives answers to these key questions… • What do we know? • What do we not know? – What is still missing from the picture? • How are we going to find out?

© 2014 The Karen Martin Group, Inc. 15 What is A3? • The core of Toyota’s renowned management system. • A structured method for applying the scientific method (via plan-do-study-adjust) to problem solving. • International designation for 11 x 17” paper. 15

© 2014 The Karen Martin Group, Inc. 18 The Purpose of the Report: Learning & Development • Reflect the problem-solving process • Assess learning • Define developmental opportunities • Build effective storytelling skills • Create organization-wide consensus about the problem and next steps Using A3 without a highly proficient coach is like learning to play the piano from YouTube.

Common Components & Structure of the A3 Report Theme: “What is our area of focus?” Owner: Person accountable for results. Plan Do, Study, Adjust Background Current Condition Countermeasures / Action Plan Effect Confirmation Follow-up Actions • What? • Who? • When? • Where? (if relevant) Target Condition / Measurable Objectives • Diagram of desired state VISUAL! • Measurable targets – how will we know that the improvement has been successful? • Diagram of current situation or process VISUAL! • What about it is not ideal? • Extent of the problem (metrics) • Problem statement • Context - Why is this a problem? How large is the problem? VISUAL! Root Cause & Gap Analysis • Graphical depiction of the most likely direct (root) causes VISUAL! • What measurable results did the solution achieve (or will be measured to verify effectiveness)? • Who’s responsible for ongoing measurement? • Where else in the organization can this solution be applied? • How will the improved state be standardized and communicated?

© 2014 The Karen Martin Group, Inc. 21 Theme: “What is our area of focus?” Owner: Person accountable for results. Background Current & Target Conditions Countermeasures / Action Plan Effect Confirmation Follow-up Actions • What? • Who? • When? • Where? (if relevant) • Include pre- and post metrics table • Problem statement • Context - why is this a problem? Root Cause & Gap Analysis • Graphical depiction of the most likely direct (root) causes • What measurable results did the solution achieve (or will be measured to verify effectiveness)? • Who’s responsible for ongoing measurement? • Where else in the organization can this solution be applied? • How will the improved state be standardized and communicated? Metric Current State Desired Target Condition Projected % Improvement Lead Time Quality Labor Effort Morale/Turnover Inventory Turns Market Share Returned Parts Common Components & Structure of the A3 Report

© 2014 The Karen Martin Group, Inc. 22 Sample A3 Report Problem Countermeasures / Implementation Plan - Ÿ32% of customers dissatisfied with office space cleanliness- 80% of emergency service requests are to wrong contact - Standard work for restroom cleaning - Standard work checklist for non-routine items - Service levels vary by building - Standard process for measuring & mixing chemicals - 10% of daily staffing available is allocated to travel/check in time - Restroom cleaning log - Standard facility service plan (Plan A & Plan B) Current Condition - Modify & standardize process for unplanned absences - 31 Facility areas require custodial services - Modify starting points and schedules to reduce transportation waste - Evaluate fleet availability to reduce waiting waste Effect Confirmation Target Conditions/Measurable Objectives - 80% Daily staffing availability - 50% Improvement - customer satisfaction with restroom cleanliness - Defined standard work (for custodial staff and customers) Follow Up Actions Root Cause & Gap Analysis - Undefined level of service (office parties, special events) - No defined process for unplanned absences (calling in, redistribute work, etc.) - Inconsistent availability of communication tools (vary by building) - No defined process for requesting/responding to emergencies - Variation in cleaning schedules versus facility operating schedules - Unpredictable daily staffing - Travel time + Check in Time = 16.00 hrs/day = 2 FTE - Customer requested personalized service (newspaper delivery, parties, trash) CUSTODIAL SERVICES A3 Plan Do, Check, Act - 22% of customers dissatisfied with restroom cleanliness 8% 20% 8% 14% 17% 33% 0% 5% 10% 15% 20% 25% 30% 35% Phone Call to Custodian Phone Call to Custodial Supervisor Phone Call to Custodial Manager Phone Call to Public Works Dispatch (x6000) Email Notify Custodial Staff On Site Survey: When you require emergency services, how do you request them? 32% 22% 19% 18% 6% 0% 10% 20% 30% 40% Office Spaces Restrooms Common Areas Overall Conference Rooms Survey: Custodial Services - Areas of Dissatisfaction Travel/ Check In Time 16.00 10% Absent Staff 24.00 15% Vacancies 24.00 15% Special Events 2.00 1% Staff Available 94.00 59% Daily Staffing Availability (Hours) 41% ofdaily staffing is unavailable for custodial tasks T itle # Staff H rs/ Wk H rs/ D ay Lead Custodian 4 160 32 FT Custodian 8 520 64 FT Custodian (Vacant) 2 80 16 PT/Perm (avg 30 hrs each) 3 90 24 PT/Temp (avg 20 hrs each) 3 60 24 T o tal 20 910 160 Travel/Check In Time 8.00 5% Absent Staff 24.00 15% Special Events 2.00 1% Current State Staff Available 94.00 50% PI Time Savings 15.00 9% Fill Vacancies 24.00 15% Reduced Travel/Check In Time 8.00 5% Staff Available 126.00 79% Future State Daily Staffing Availability (Hours) 22% 10% 12% 0% 5% 10% 15% 20% 25% Dissatisfied Customers (Current) Target Future State Restroom Cleanliness Customer Satisfaction Current Actual Result State (+ 60 days) Customers dissatisfied with restroom cleanliness 22% <10% Avg minutes per restroom cleaning 35 30 Avg hours per day cleaning restrooms (184 restrooms) 107 92 Daily staffing availability 59% 80% Daily travel/check in time (hours/day) 16 8 Travel miles per day 139 <70 Metric Projected Remaining Actions Owner 1 2 3 4 5 6 7 8 9 10 11 12 Explore options to improve cell phone availability Mark R. Define process for requesting and responding to emergencies Custodial Supvs Equip carts for recycling Mark R. Process mapping for specialized facilities Mark R. Standardize Cart Equipment & Supplies Custodial Supvs Process improvement for other facility types, e.g. offices, common areas, etc. Mark R. Consider alternative staffing models (floaters, modified shifts) Mark R. Actively manage vacancies Mark R. Implementation Schedule (Months) 269 220 91 27 19 15 0 50 100 150 200 250 300 Office Space Rec Center/Gym Library Shops Misc. Animal Shelter Work Hours per Week by Facility Type

Sample A3 Countermeasures / Action Plan BEWARE: Plans are subject to PDSA!

© 2014 The Karen Martin Group, Inc. 27 Common Components & Structure of the A3 Report Theme: “What is our area of focus?” Owner: Person accountable for results. Plan Do, Study, Adjust Background Current Condition Countermeasures / Action Plan Effect Confirmation Follow-up Actions • What? • Who? • When? • Where? (if relevant) Target Condition / Measurable Objectives • Diagram of desired state VISUAL! • Measurable targets – how will we know that the improvement has been successful? • Diagram of current situation or process VISUAL! • What about it is not ideal? • Extent of the problem (metrics) • Problem statement • Context - Why is this a problem? How large is the problem? VISUAL! Root Cause & Gap Analysis • Graphical depiction of the most likely direct (root) causes VISUAL! • What measurable results did the solution achieve (or will be measured to verify effectiveness)? • Who’s responsible for ongoing measurement? • Where else in the organization can this solution be applied? • How will the improved state be standardized and communicated?

© 2014 The Karen Martin Group, Inc. 28 A3 Roles & Responsibilities: The Owner • Individual who’s accountable both for the results and the process for achieving results. • Problem owners have the authority to engage anyone needed and the responsibility to engage all relevant parties.

© 2014 The Karen Martin Group, Inc. 30 The Key to A3: Coaching REFLECTIVE DEVELOPMENT DIRECTIVE DEVELOPMENT From The Outstanding Organization, p. 117 Heavy use of Socratic questioning to assess learning, develop critical thinking, and build confidence Here, the coach serves as teacher. Beware of the difference!

© 2014 The Karen Martin Group, Inc. 32 A3 Coaching Tools: Coaching Session Prep Checklist & Socratic Questions for A3 Coaches If you’re not a subscriber: www.ksmartin.com/subscribe If you already subscribe, email: A3Tools@ksmartin.com

© 2014 The Karen Martin Group, Inc. 36 Theme: “What is our area of focus?” Plan Background Current Condition Target Condition / Measurable Objectives • Diagram of desired state VISUAL! • Measurable targets – how will we know that the improvement has been successful? • Diagram of current situation or process VISUAL! • What about it is not ideal? • Extent of the problem (metrics) • Problem statement • Context - Why is this a problem? How large is the problem? VISUAL! Root Cause & Gap Analysis • Graphical depiction of the most likely direct (root) causes VISUAL! Nailing the Plan stage of PDSA is the most important element in the entire process.

Background: “The problem is…” and “this is how big it is…” 37

© 2014 The Karen Martin Group, Inc. 38 Understanding the Current State • Go to the gemba! – OBSERVE • Performance data • Spaghetti diagrams • Documentation / job aid review • Videotape / photos • Worker interviews • Work samples • Mapping – Value Stream Maps (VSM) - strategic – Metrics-Based Process Mapping (MBPM) – tactical

© 2014 The Karen Martin Group, Inc. 39 Root Cause Analysis: 4 Key Tools CauseCause--andand--Effect DiagramEffect Diagram Machine Measurement Environment People Material / Info Method Budgets Submitted Late Lack of experience Time availability No sense of import No stnd spread sheet Email vs. FedEx No standard work Input rec’d late Forecast in other system Manual vs. PC System avail. No milestones $ vs. units Weather delays Dispersed sales force Changing schedule Machine Measurement Environment People Material / Info Method Budgets Submitted Late Lack of experience Time availability No sense of import No stnd spread sheet Email vs. FedEx No standard work Input rec’d late Forecast in other system Manual vs. PC System avail. No milestones $ vs. units Weather delays Dispersed sales force Changing schedule 5 Why’s Why? Why? Why? Why? Why? Check Sheets Quantify Occurrences |Equipment failure |||||||||||||Changing customer requirements w/ no adjustment to expected delivery ||||||||||Order entry error |||Staffing/absenteeism |||||Quality issue requiring rework |||||||Material shortage TallyReason |Equipment failure |||||||||||||Changing customer requirements w/ no adjustment to expected delivery ||||||||||Order entry error |||Staffing/absenteeism |||||Quality issue requiring rework |||||||Material shortage TallyReason

© 2014 The Karen Martin Group, Inc. 40 Common Questions • How long does it take to complete an A3? • Can I use A3 for daily kaizen or during kaizen events? • What’s the relationship between Strategy Deployment (Hoshin Kanri) and A3? • What’s the relationship between Value Stream Mapping and A3?

A3 Management: Effective Problem Solving via PDSA

TKMG, Inc.

A3 Management: Effective Problem Solving via PDSA