1. Leadership Training
We’ve dedicated a lot of effort to training and coaching our leadership. We’re improving our goal setting,
personal productivity & communication. This is translating into improvement throughout AEC leadership.
Our leaders are better able to understand what to do and how to get it done – individually and via their
2. Visual reporting
We developed several internal tools to make data readily available.
Project reporting tools make data easily viewable via computer screen or projectors: project timelines,
scope, correspondence. All project documents are available throughout the organization: Drawings, Bills
of Material, Task lists, …
Two areas of opportunity
“Value the People. Praise the effort. Reward the performance.” – John Maxwell
We do the first one very well. We need to improve the second and third.
1. Recognition, Rewards & Consequence:
Our original incentive plan was: one person, one share”. Reward was based on actual profit. We (I)
thought that this would promote teamwork across boundaries. Even after several years, we could not see
improvement. We’re designing a new incentive & recognition plan to reward performance based on
We’re looking at establishing levels of achievement based on topics within control of the individual, such
as: training, personal productivity, safety, mission alignment
2. Communication & Teamwork
Remove or reduce boundaries between Engineering, Purchasing, Manufacturing.
Statement of what winning the award means to you and to Automation Engineering
This is a difficult economy. Investment in capital equipment is down. No quick turnaround, … Etc. We all
know this. Even so, it is hard on morale & attitudes. It is easy to translate that into personal angst &
This award is validation: we’re doing the right things. We’re improving. Having problems is okay, as long
as we’re solving them.
This award is celebration: we’re doing enough things right to survive. And on top of that: we’re recognized
by highly qualified and successful people in our field for doing so.
How we celebrated the award
The standard celebration at AEC is local barbeque & beer party on Friday afternoon. This was a
combination party: winning the AME North American Excellence Award, we shipped a major order in a
brand new industry under our new business model, we made a major business acquisition, and, of
course, it was hallowe’en.
We invite spouses & their children. We celebrated this party in our shop, over the site where we built the
We held our “all-hands” business update meeting. I discussed my trip to the AME conference, my
“epiphany” on our need to focus on our people. We also made a major organization change (already in
the works)- one major effort is to improve our focus on employees.
We’re anticipating good business as the economy improves and as we see results of our new business
1) Continuous Improvement: Multiple successful Lean projects on the same lines. We have been
successful in taking many smaller "wins" that add up to significant savings in both cost and space. You
are never done in this business and think you can relax.
2) Getting everyone involved. These are not just engineering driven projects but a cross-section of
everyone. This has given an equal voice to the process and provides "the gemba" direct experience and
has ideas generated from everyone.
1) Lean Business Practices: Looking outside the 4 factory walls and looking at some of our business
practices particularly in how our warehouse is used and restocking of supplier inventory.
2. Office Lean: In hearing some of the practices and presentations from the conference, we have a ways
to go in this area.
Winning the award provides some validation of a lot of hard work by many people over the years here at
Medtronic. Personally, it means to me that manufacturing can succeed in North America and it feels good
to have a hand in it.
Celebration: Management is cooking for both shifts coming up here shortly.
*A sustained culture of improvement since 1998. WE initially focused on manufacturing although the plan
called for company wide change. Over the years we have incorporated lean changes in engineering,
training, accounting, inside sales and administration. Changes include going paperless in design giving
more people access to important documents real time. Extensive cross training in engineering and
eventually taking away the safety (waste) net of a “checker.” All designers are now responsible for their
own work and release drawings directly to the plant floor.
*Brand loyalty. By eliminating much of the waste associated with traditional models, we have been able to
continue focusing on our customers with new vigor. Because our systems are streamlined and effective,
our people find it enjoyable to live our motto of “helping our customers be successful.” Tasks have
become secondary to customer service. In our traditional model, customers had become a nuisance for
our inside sales people. The reliability of the system assures much better quality and on-time delivery.
Our customers have experienced a sustained positive experience over time that is invaluable in the
Top line growth. Because our manufacturing cell and support models are so clean, and because our
brand is so strong, we are in a position to seek out new forms of growth through the purchasing of other
products that can be sold through our channel. This is both a challenge and an opportunity as we have
traditionally only sold what we built. Moving in this direction will challenge us and strengthen us at the
Innovative strategies. Looking forward, we have the opportunity to impact our business by developing
innovative ideas and solutions. Capitalizing on this opportunity will require changing our outlook and
culture to embrace “creative think” time. Historically, we have been served well with a pragmatic
approach. We have very talented people through out the company that if given the chance to innovative,
I’m confident would generate exciting opportunities to provide meaningful solutions that may transcend
our traditional industry.
1. Policy Deployment – starting with PD on day one for me was crucial to our success. PD forced
us to develop a new mission statement, a long range vision, a mid range vision, and a short term
vision (compass). We then looked at every single project/activity going on in the company and
determined if it was directly or indirectly targeting any one of our visions. If it wasn’t targeting
our visions, we stopped the project. If it was, we then focused on resource allocation as well
prioritization. This allowed us to have a systematic approach to our strategic planning. We met
monthly to discuss PD and the PD activities to ensure progress was happening and determine
whether course correction was needed or not.
2. Incentive program – Parallel to PD, I kicked off an incentive program that allows the employees
to accumulate “points” (poker chips). There are many ways to get these point (Employee to
Employee, Manager on the Spot, Voluntary Team Participation, Balanced Score Cards, Training,
Implemented Improvements, Recruitment, and Employee of the Month/nominees). This,
coupled with the profit sharing program we have, provided employees an additional incentive to
get on board and participate. The one that means the most to me is the implemented
improvements which is a great gauge to see folks thought processes as well as how to quantify
the improvements made.
1. Capital Equipment business – we didn’t have a solid business model for this volatile business
and now are feeling the pain with the slow down in capital expenditures. We need to focus on
partnerships with our customers as opposed to a quickly responding to requests for quotes. Our
process has improved so much that many companies knew they could call upon us to provide a
quote quickly and fulfill their requirements for ‘multiple bids’. We needed to do a better job of
filtering which opportunities we real and which were causing us to be a “quote factory”
2. Short Leash – as the company grew rapidly, I feel I didn’t have a short enough leash to pull
when folks that “grew up” with the business were in positions that outgrew their capabilities.
We spent A LOT of time working with these great employees, but the reality of it is that some of
them will never be able to keep up with the demands of the position when the business is at
$10M vs when it was at $5M.
What the award means to us: The company didn’t even know we applied – the first they hear of
the application was when I announced we won. I did it as I knew that our Lean progress was
good and comparable to many companies that had been on the journey for MANY years. We
have A LOT of room for improvement and fall down daily – which sometimes causes the troops
to get frustrated or doubt the full power of Lean. By us winning the award, we are able to
celebrate the fact that we are a DAMN good company, even if we still have problem. We
celebrated in one of our monthly ALL Hands meeting, but I use this as fuel for the fire to keep
folks motivated and understanding that our journey has just started – and we are on the right
1. Our line of sight management approach which drives focus and accountability from the factory
floor to the end customer.
2. Development of our one-piece flow and customer demand planning model which drives customer
centric focus and provides superior delivery performance with minimal inventory levels.
1. Continue driving our lean practices up and down the value stream inclusive of our suppliers and
2. A relentless focus on development of the leadership so as to assure on-going sustainability of our
lean practices which we call the DJO Way.
What does winning the award mean to DJO?
Entering the process enabled us to benchmark ourselves against the best of the best in order to highlight
areas where we are doing very well, but more importantly, highlight areas where we have opportunities
The award helps us give well deserved recognition to the people who make our company great and drive
the performance improvements that enabled us to win the award. We also use the award to help us sell
our products to existing and new customers giving them confidence that they are partnered with a truly
world class company and workforce.
1. We had an all employee luncheon and recognition event which all of our company Senior
Executives and Officers attended.
2. Took the Vista site leadership team (from team-leader up) out to dinner one evening
3. Sent out a notice to our sales force letting them know about the award and how they could use
this to promote DJO to potential new and existing customers.
1) People Practices – putting the right people in the right places, training (multi-tiered) leading to a
flexible work force (incl. TWI)
2) Lean Accounting – eliminating non-value transactions, weekly financials/box scores and valuing
customers, new business and capital based on lean thinking (incrementally)
1) Gain sharing based on box scores monthly
2) Improved discipline in all areas of company (6S/TWI-JI moves at different pace in different area –
the Leadership difference)
What the award meant to us:
1) Good way to recognize the length we’ve come over 3 years and our accomplishments
3) Reinforce a “payoff” for the people’s hard work
4) (Hope to) gain new business.
1. Lean Manufacturing
- Improvements in material flow,
- Line redesign,
- Increased takt time
- Improved morale
- Established a lean culture
- Lower inventory
2. Lean Supply Chain
- Establish pull systems
- Fewer # of purchased orders and receipts
- Higher collaboration with suppliers
- Fewer shortages
- Lower inventory
- Lower excess and obsolete
1. Lean Accounting
- Need to establish financial metrics that better tie to Lean processes
- Need operational metrics that highlight opportunities for improvement
- Need to reduce waste in AP and AR processes
2. Lean New Product Introduction
- Implement design for lean
- Improve design for manufacturability
- Use fewer items
- Re-use existing parts