Introduction to Lean / Six Sigma in Foodservice Operations: A Tool Kit
Brad Krakow Project Manager, The CBORD Group, Inc. bkk@cbord.com
Tell Them What You Will Tell Them
• Introduction • Brief overview of Lean Six Sigma terms and history • A five step sequence for action • Examples from the field • Conclusion
This is really true:
• You should expect 100-1000% improvements in efficiency from an initial “Lean” process review and improvement. • Really.
The Big Idea
• Foodservice is a complex manufacturing system. • Service is one important but brief moment, yet we refer to ourselves collectively as “The Service Industry”. • Tap into the manufacturing literature to revisit foodservice operations. • Everyone looks smart in an up business cycle. What about the opposite?
• • • •
All models are flawed. Some models are useful. Effective models let you see “new things”. Models without knowledgeable commitment are entertaining at best, dangerous at worst. • Question - Which one of these three US Auto Companies embraced Lean concepts?: 1.GM 2.Chrysler 3.Ford
Where this came from?
• Chris Haley – CBORD Director of Development (aka – my sensei) • New day for our programming group • IT next - ditto • Introduction to Client Services
Lean Eliminate waste Pull Continuous improvement
• Associated with Toyota Motors • Used where there is obvious and low hanging fruit. • Is highly dependant upon the demands of its customers and reliability of its suppliers.
Six Sigma
• Associated with minimizing variation • Literally seeks to get to 3.4 exceptions per 1,000,000 events. • Associated with Motorola • Good at explaining why Work in Progress (WIP) is just a bad thing. • Used where causes of problems are not obvious • Lots of math, acronyms, and analytical tools
History
• Taylor – Scientific Management • 1924 - a phone company in Chicago: • Shewart • Deming • Juran • WWII • Quality standards as a matter of life or death • Toyoda • Lean Thinking
Acronyms and other language not used in this presentation:
NAOV, CPM, CTQ, DFSS, DPMO, DPO, DPU, EVOP, FMEA, SMECA, FPY, KPIV Gemba, Heijunka, Hoshin, Jidoka, Seiban, Shojinka, Poke Yoke
You are a candidate for Lean if: Apparent waste Opportunity to reduce inventories Opportunities for workflow efficiencies Opportunities to speed up work flows Too many mistakes are made
A Client Example Florida Hospital
• Using Lean to:
Reduce costs Improve service Double capacity in fixed location
Special thanks to: Shawn Noseworthy Kiden Koegel
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Ever been to an In and Out Burger?
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Reality Matters
• • • • Respect “Deep Knowledge”. Don’t drink your own Kool-Aid. Plot “who really does what”. Digital cameras / Cell phones are great tools to easily delegate and display “current state”.
A Five Step Lean/Six Sigma Program
1. 2. 3. State the value you provide. Identify the physical flow of product and information movement in your organization. Create a Swim Lane analysis of specific process to confirm existing standard of operation. Use a Value Stream Map to identify specific changes and anticipated benefits. Share the process / results / and do it again.
4. 5.
Tool #1 - Specify Value
• Value is from the perspective of the customer! (value add) • If the customer does not perceive a value, is there a significant value to your company? (business value add) • If neither then it is a waste and should be eliminated! (no value add)
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Task
• Create a list of processes your organization uses to provide value. For example:
Serve quality food quickly Present customer with an accurate bill quickly Meet financial goals Order food Pay vendors Hire staff Train them
Tool #2 – Identify Physical Product and Information Flow
• Create a flow chart of your cost centers / suppliers and how they interact. • This alone is frequently a stunning revelation to most within and outside the department. • This will help identify where obvious “opportunities” for analysis exist.
For Example:
Physical Flow of Product
Task
• Create a physical flow map for your operation • Share with your peers until all agree • Post this • Pass to the Director • Use when discussing internal dynamics.
Tool #3 – Swim Lane Analysis
Map a process that includes “hand offs” between individuals / departments
Vendor
Receives Order
Bakery Production
Create Production Schedule
Determine Ingredient Needs
Receives Delivery
Puts away Product
Stage / Produce
Ware Wash
Serving Distribution Unit`
Loads truck
Start
Menu Forecasted
Receives Product
Customer is Served
End
Flow Charts and Swim Lanes
• A flow chart shows the relationships between things, steps, processes, etc. • A swim lane chart shows how people/organizatios and things interact. • Turn a swim lane chart on its side and it looks like a series of silos. Hmmmm.
Flow charts make it look pretty
Swim Lanes make it hard to hide
Swim Lanes make action items clear: There is usually an “as is” and “desired”
Task
• Using the list of processes from step one, create a Swim Lane Analysis for one of your simplest processes. • Capture “current state” – this is what you will improve upon. • Share with all involved parties until agreement is reached. This prepares everyone to use this tool. • Create Swim Lane Analysis for standard payment or receivable procedures. • Share with all involved parties until agreement is reached.
Tool # 4 – Value Stream Map
• Track each step that is required to provide the end value. • Determine how much time the step takes? • Determine how much of that time is actually spent providing value? • Determine how much time is spent waiting between steps? • Determine how many items are in a queue at any given time? • Determine how much time is spent in “re-work”?
Work In Progress tends to be Evil
• • • • • What is WIP? Undifferentiated demands or load Greater load than there is capacity to manage Large batch vs. on demand production “Two over easy” vs. “the envelope with this week’s invoices”
Value Stream Map
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Request .5 hrs
1 hrs
48 hrs
Approve .1 hr
24 hrs 16 hrs
Requirements 80 hrs
160 hrs 4 40 hrs
6
Test 40 hrs
120 hrs 8 20 hrs
30 hrs
Code 80 hrs
280 hrs
20 hrs
Signoff 1 hr
40 hrs
15% rejected
Deploy 2 hrs
32 hrs
Swim Lane with Value Stream Map
V endor
Receives Order
Bakery P ro du ction
Create Production Schedule
Determine Ingredient Needs
Receives Delivery
Puts away Product
Stage / Produce
Ware Wash
S erv ing D istribution Unit`
Loads truck
Start
Menu Forecasted 8 2 Production Schedule
Determine qty of ingredients needed
Receives Product 8 Order ingredients 8 Receive / put away 8 Pull / Scale / Produce 2 Distribute 2
Customer is Served
End
start
Forecast Muffin
Serve the Muffin
end
Task
• Working from the Swim Lane Analysis, create the Value Stream Map. • Set specific starting and ending points. • Only include steps that add value (others should be removed). • Enter times (estimate if needed - be conservative).
Tool #5 – Value Stream Map Analysis
• Ratio of value-directed time to total time = process efficiency • Areas of high non-value added time • Areas of long waits • Areas of big queues • Areas of rework
CBORD Product Group Implementation
Sys Admin
Start
Training Received
Code initial settings
Print and confirm
Correct and Repeat
End
Finance Accounting
Determine financial reporting needs
Confirm settings in actual use
No
Yes
Operations
Set Operational
Categories
Set Rollup Groups
Conduct business
Confirm settings in actual use
OK?
CBORD
Training provided
Review or troubleshoot
160 hrs Start
Explain Product Group function 20 minutes
.5 hr
8 hrs
Collect chart of account information 10 minutes .25 hr
Code Product Groups 20 minutes
.5 hrs
40 hrs
Confirm through summary reporting 5 minutes
End
Fix errors 1 hr
Current State VSM Analysis
CURRENT MODEL Work Time Elapsed Time Wait Time Rework Time Notes 4 weeks from CCR to first train
Start Train Product Group Collect Chart of Accounts Code Product Groups Confirm through usage End
0
0
160
0.333
0.5
0.2
0.25
8
Takes a day to get 4 weeks transaction processing to test summary reports
0.333
0.5
40
0.1 0.97
0.25 1.50 208.00
1 1.00
Rework 211.47 Total elapsed time
0.5% Efficiency
Proposed VSM Analysis
ENHANCED MODEL Work Time Elapsed Time Wait Time Re-work Time Notes 1 day for ICE sign up and video / audio tutorial On line training module Takes a day to get Create Setting Report that shows end result format
Start Train Product Group Collect Chart of Accounts
0
0
8
0.5
8
0.2
0.25
8
Code Product Groups Confirm through usage End
0.333
0.5
0
0.1 1.13
0.25 9.00 16.00
0 0.00 26.13 Total elapsed time
4.3% Efficiency
Task
• Create a spreadsheet to analyze the Value Stream Map you have created. • Review with your group. • Identify opportunities for constructive change. • Re-construct the Value Stream Map and analysis spreadsheet to show new model. • Implement the change • Celebrate!
Five Step Review
1. 2. 3. State the value you provide. Identify the physical flow of product and information movement in your organization. Create a Swim Lane analysis of specific process to confirm existing standard of operation. Use a Value Stream Map to identify specific changes and anticipated benefits. Share the process / results / and do it again.
4. 5.
A Small Sample of Lean Six Sigma Terms DMAIC: • Define • Measure • Analyze • Improve • Control
Types of Waste (Muda)
1. 2. 3. 4. 5. 6. 7. Transportation Inventory Motion Waiting time Over-production Extra Processing Defective Product
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Lean 5 Steps (Womack/Jones)
1. 2. 3. 4. 5. Specify Value Map the Value Stream Create Flow Pull Pursue perfection
5S
Sort – remove non-essentials Straighten - place things efficiently Sanitize –clean it up Standardize – ongoing improvement process 5. Sustain – discipline with leadership Five Whys 1. 2. 3. 4.
A few more sample Swim Lane Charts How do we work together?
Want to Get Paid for a Catering Event?
Reading List
• Lean Thinking – Womack / Jones • The Deming Management Method – Walker • Lean Software Development – Poppendeick/Poppendeick • Lean Six Sigma Pocket Toolbook – George, Rowlands, Price, Maxey
Take Away
• You must have a standard operating procedure in order to improve it. There is tremendous value in effectively holding up a “neutral” mirror to an organization. • Find people in your organization that “think lean”. • Think Big, Act Small, Fail Fast, Learn Quickly. • Less is more – As cool as Value Stream Mapping is, much initial benefit comes from higher level process analysis or “holding up the mirror” • Technology enables good business, but does not cause it.
Conclusion:
1. Chart your transactional world 2. Use Swim Lane analysis to confirm current practice. 3. Value Stream Map to improve. 4. Read the books
Thanks and Good Luck Out There!
• Please fill out evaluations • bkk@cbord.com
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Thanks and Good Luck Out There!
• Please fill out evaluations • bkk@cbord.com