© 2011 ibm corporation isc smart lean an overview of ibm’s lean deployment strategy rochester, mn

© 2011 IBM Corporation

ISC SMART LeanISC SMART Lean

An Overview of IBM’s Lean Deployment Strategy

Rochester, MN

© 2011 IBM Corporation2

IBM Rochester Manufacturing SiteIBM Rochester Manufacturing Site Overview

Year Plant Opened: 1956 875,000 Sq Ft of space

– Largest IBM site under one contiguous roof Type of Product Assembled:


Power Systems

Power 750 Watson

Gaming Technology

Supercomputing

Worldwide Supply Chain

Global Customer Solution Center

Analytics and Software Development

Americas Finance Center of Excellence

Global Systems Software Support Center

Global Business and Technology Services

Cloud Computing

A Leader in Innovative SolutionsA Leader in Innovative Solutions


Incentive and Motivators for a Lean TransformationIncentive and Motivators for a Lean Transformation What are some of the key challenges this domain experiences?

– Customers expectations are increasing for more performance, cost and quality

– Highly competitive marketplace coupled with the economic downturn in 2008-09

– Multiple new products introduced; varying complexity of design• Inefficient and non-adaptive processes for these products causes delays in

prototyping and launch

– Increasing cost to maintain facilities and infrastructure, with the constant business pressure to reduce operational costs

– Mature workforce drives ‘passive’ behaviors

– Declining employee morale and engagement

Source: “The Supply Chain of the Future”, IBM Study, 2010


What is Lean? What is Lean? Defining Lean:

“A systematic approach to identifying and eliminating wastes (non-value-added activities) through continuous improvement by flowing the product at the pull of the customer, in pursuit of perfection”

Lean is a set of processes, philosophies and improvement techniques that eliminate waste to improve operational efficiency and financial performance of a business

Lean is a term that is adapted from the Toyota Production System (TPS) where Lean methods were formalize and popularized

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Why do we want to improve the process?Why do we want to improve the process?Our customers require from us accuracy, speed, reliability, responsiveness,

features and lower cost

To achieve these requirements, we have to constantly look at our processes to ensure we are meeting our goals in all these metrics

Nature of work - Value Analysis

Steps that are ESSENTIAL because they physically change the product / service.

The customer is willing to pay for them and they are done right the first time.

Value-added work

Steps that are ESSENTIAL because they physically change the product / service.

The customer is willing to pay for them and they are done right the first time.

Value-added work

Steps considered non-essential to produce & deliver the product / service to meet customer needs.

Customer is not willing to pay for step.

Non-value-added work

Steps considered non-essential to produce & deliver the product / service to meet customer needs.

Customer is not willing to pay for step.

Non-value-added work

Steps not essential to the customer, but allowing value-adding tasks to be done better / faster;Needed for control

Value-enabling work

Customer value-added steps require a “yes”

to all three questions:

1.Will the customer pay for it?2.Is the product transformed?3.Is it done right the first time?

Customer value-added steps require a “yes”

to all three questions:

1.Will the customer pay for it?2.Is the product transformed?3.Is it done right the first time?

(Also called non-value add essential)

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The Eight Lean Wastes, or, ‘DOWNTIME’The Eight Lean Wastes, or, ‘DOWNTIME’

INVENTORYAny excess storage or supply

MOTIONAny wasted motion to pick up parts/ information. Also, wasted walking

WAITINGAny non-work timewaiting for tools, supplies, parts, etc..

OVERPRODUCTIONProducing morethan is needed before it is neededTRANSPORTATION

Movement of parts and materials or information

NON-VALUEADDED

PROCESSINGDoing

more work than is necessary

DEFECTSRepair or Rework

EMPLOYEE TALENT NOT USED

Not using or being aware of people’s talent

VA

LU

E A

DD

ED

WO

RK

5 t

o 3

0% Toxic effects of waste

• Physical fatigue • Emotional fatigue • Increased frustration • Increased stress• Placement of blame• Decreased self-worth• Indecisiveness

Tip: The 8 wastes are – “D-O-W-N-T-I-M-E”


House of Lean- Concepts and Knowledge ElementsHouse of Lean- Concepts and Knowledge Elements

Transformational Leadership

High Performing and Adaptive Culture

Clie

nt

Sa

tisfa

ctio

n

Em

plo

yee

Em

po

we

rme

nt

Pro

cess

Exc

elle

nce

Fin

an

cia

l Exc

elle

nce

Lean Vision of Success

Basic Knowledge(Getting Started)

Basic Stability

Structured Problem Solving

Plan -Do-Check -Act

Information & Support Systems

Strategic Planning

Continuous LearningOrganization

Lean 101Core Team Training

Science of Mfg.Web Lectures

LeadershipBook Clubs & Workshops

5S, Visual Management

Standard WorkProcess Map, Value Add Analysis

KaizenEvents

8D Problem Solving & A3 Process Improvement

DMAIC &DFSS FMEA

Decision Support Systems QFD

Visual Control Board

Deployment Leadership & VSM Management

SimulationModeling

Lean/Agile/LSSApplied Learning

HoshinPlanning

House of Lean Building BlocksCapabilities & Skills

Pull Value & Streamline E2E Flow

Pull Systems, Kanban

POUSSingle Unit

FlowProcess vs.

Functional LayoutResults Feed the

Organization’sBalanced Score

Card

MappingMapping

StreamStream

ValueValue

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Streamline E2E Flow: Optimizing ProcessStreamline E2E Flow: Optimizing Process

10

Process Flow Lean Waste

Root Cause Analysis

Opportunity Analysis


Lean Foundational Competencies: 5SLean Foundational Competencies: 5S Mission: To utilize the Lean team ingenuity along with Japanese 5s concepts to implement

organization, orderliness, and cleanliness for establishing a highly functional, visual, state-of-the-art manufacturing facility

What are the goals and expectations?

We will succeed in building a world class visual factory and “set the bar” for the future

We will all take personal responsibility for our work areas

We will establish the Lean stability required as a foundation to our Lean transformation

MF

G

AR

EA


Lean Foundational Competencies: 5SLean Foundational Competencies: 5SBEFORE AFTER


Smart Lean Success MeasuresSmart Lean Success Measures

YEAR 2009 2010 2011 2012

Lean Certified Candidates Under Plan Improving >90%

Lean Projects Implemented Under Plan Improving >90%

Innovation Idea Implemented Under Plan Improving Exceeded Plan

5S/Kaizen Implemented Under Plan Improving Exceeded Plan

Internal Process Improvements Under Plan Improving >90%


BusinessPerformance

Success

Process

Technology

Peo

ple

Lea

rnin

g

Innovation and continuous improvement enabled through process excellence and high performing organization culture

Innovation and continuous improvement enabled through process excellence and high performing organization culture

TransformationalLeadership

Adaptive Culture Process

Excellence

Building OrganizationalCapabilities for Business Transformation

Path Forward Change Paradigm

“Teach your associates to teach themselves and in that way you will strengthen the entire organization” – IBM

Founder, Thomas J. Watson, Sr. 1947

“Teach your associates to teach themselves and in that way you will strengthen the entire organization” – IBM

Founder, Thomas J. Watson, Sr. 1947

Balanced Scorecard

• Customer Value

• Financial Excellence

• Process Excellence

• People Learning & Growth

Path Forward* Approach to Lean Transformation

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*Path Forward is a global IBM business transformation initiative driven out of the corporate center for Learning and Development


Lean Transformation Roadmap

Compelling Reason for Change ( Why leave where we are? )

Vision ( Where do we want to go? )

Transformational Leadership ( Who will take us there? )

Change Plan ( How will we get there? )

Enable advocates for change ( How will we enroll others to go where we want them to go? )

Path Forward Transformational

Leadership Development

Path Forward Transformation Teams

OCI©

Current State

OCI©

Preferred State

*Reference: Adapted form Dr . Marvin Washington

*The OCI is a registered Trademark of Human Synergistics International, Inc.- Dr. Robert Cooke

Our Approach to a Successful Change Initiative*Our Approach to a Successful Change Initiative*

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Why Culture?Why Culture?

LEAN Disciplines are 90% People, 10% Tools

Adapted from:

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Over the past 8 years,

the OCI has been used to

measure the current and

preferred states of the

STG/ISC Organizational

Cultures to identify the

key Levers for Change.

Significant culture and

business performance

improvement have been

realized.

Organizational Culture Inventory – OCI®

“Culture is everything” – Lou Gerstner (2002)Organizational Culture Inventory – OCI®

“Culture is everything” – Lou Gerstner (2002)

What is the OCI? Most widely-used and thoroughly-researched tool for measuring organizational culture

Quantifying and managing organizational culture is critical

Brings an organization’s values “to life,”

Supports the implementation of its strategies

Promotes adaptation, goal attainment, and sustainability

How does the OCI work? Provides organizations with a visual profile of their operating cultures (Current

Culture) in terms of the behaviors that members believe are required to "fit in and meet expectations."

These behavioral norms have a significant impact on the organization’s ability to solve problems, adapt to change, and perform effectively

Why do an OCI? Provides a reliable, valid, and true measure of culture—clearly distinguishing culture

and climate as distinct yet interrelated organizational variables

Supporting programs designed for strategy implementation, employee engagement, organizational learning, quality and reliability, and/or customer service (a balanced scorecard approach)

Human Synergistics International ®, 2012

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Why Transformational Leadership?Why Transformational Leadership?

19

Transformational Leader**

• Individual and collective consideration

• Attentive to employee and organizational needs

• Coach and mentor, encourages and recognizes

• Intellectual stimulation

• Challenges assumptions, takes risks and solicits employees' ideas

• Continuous learning and innovation is valued

• Inspirational motivation

• Challenge their employees with high standards

• Communicate optimism about future goals

• Role model through living the values of the organization

**Bass, B.M., Leadership and Performance, N.Y., Free Press (1985)


Leadership Impact (LI)

Assessment (SLT);

1:1 Debrief

Leadership Impact (LI)

Assessment (SLT);

1:1 Debrief

Composite LSI Reports;

Transformational

Communication Module

Composite LSI Reports;

Transformational


Life Styles Inventory (LSI)

(First Lines, Technical Leads);

1:1 Debriefs

Life Styles Inventory (LSI)

(First Lines, Technical Leads);

1:1 Debriefs

Identify Common Themes;

Implement Actions

Identify Common Themes;

Implement Actions

Update Management System to Sustain the

Change

Update Management System to Sustain the

Change

Path Forward to a Lean TransformationIllustration of a Transformational Leadership Roadmap

Path Forward to a Lean TransformationIllustration of a Transformational Leadership Roadmap

Senior Leadership

CommitmentSenior Leadership

Commitment

Develop Transformational Leadership Strategies

(SLT and First Lines)

Develop Transformational Leadership Strategies

(SLT and First Lines)

1

2

3

4

5

6

7

8

Composite LI Reports;

Transformational


Composite LI Reports;

Transformational


Kaizen, Lean Certif

ication, P

DCA, SDWT, G

emba…


Lean Competencies: Using the right tools to address business challenges Lean Competencies: Using the right tools to address business challenges

Kaizen Events

• Simple Projects / Low Complexity• Very QUICK wins.• Low Analysis• Main Objectives

• Train Organization• Drive Business Benefit

Lean Projects for Certification

• Lean Wastes Identified• Opportunity Analysis • Moderate Complexity• Moderate degree of technical Analysis• Prioritized on Business Value• Moderate Time to complete

Lean Sigma BB

•High Complexity•Cross Functional

• High Risk•Long Duration• Large Payback

HIG

H C

OM

PLE

XIT

Y L

OW

LO

W N

° Em

ployee Engagem

ent HIG

H

All EmployeesOperator, Subcontractor,

Supplemental ,Team Lead, Manager, Supervisor,

Technical, etc

Subject Matter ExpertsTechnician, Team Lead,

Manager, Supervisor, etc

EngineeringAny Engineering level,

Any Area (Quality, IndustrialManufacturing, Testing, etc

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Lean Certification LevelsLean Certification Levels

BRONZE LEVEL

1. Complete LVC and Pass the Bronze Level Certification Examination2. Lead or Actively Participate in 1 Lean TACTICAL* Project3. Knowledge of 8 Step Structured Problem Solving

BRONZE LEVEL

1. Complete LVC and Pass the Bronze Level Certification Examination2. Lead or Actively Participate in 1 Lean TACTICAL* Project3. Knowledge of 8 Step Structured Problem Solving

SILVER LEVEL

1. Pass the Sliver Level Certification Examination2. Lead or Actively Participate in 3 Lean TACTICAL* Projects3. Coach and Mentor; Conduct Workshops or Kaizen Events using 8 Step* - Deployment and application of lean principles, concepts and methods within a work cell, work group or value stream

SILVER LEVEL

1. Pass the Sliver Level Certification Examination2. Lead or Actively Participate in 3 Lean TACTICAL* Projects3. Coach and Mentor; Conduct Workshops or Kaizen Events using 8 Step* - Deployment and application of lean principles, concepts and methods within a work cell, work group or value stream

GOLD LEVEL

1. Pass the Gold Level Certification Examination2. Lead or Actively Participate in 5 Lean TACTICAL* Projects3. Coach and Mentor; Conduct Workshops or Kaizen Events using 8 Step4. Lead or Actively Participate in 3 STRATEGIC# Projects

GOLD LEVEL

1. Pass the Gold Level Certification Examination2. Lead or Actively Participate in 5 Lean TACTICAL* Projects3. Coach and Mentor; Conduct Workshops or Kaizen Events using 8 Step4. Lead or Actively Participate in 3 STRATEGIC# Projects

* - Deployment and application of lean principles, concepts and methods within a work cell, work group or value stream# - Projects that demonstrate the transformation of a business or organization

Adapted from SME Lean Certification BOK

Gold practitioners help to lead the Lean deployment across an organization

Bronze Level practitioners help lead Kaizen events

Silver practitioners Lead Lean

Improvement Project teams


•Lean Certification Training• Transformational Leadership Training• Lean 101 Basics

OCI Workshop

• Review external best practice opportunities

Monthly 5S audit/Re-audit&

Innovation on Job

External Benchmarking 2x per quarter

•Project Management•Financial Roll-Out

2015 RoadMap


SMART Lean ContactSMART Lean Contact

24

Sathish Selvaraju

Office – Rochester, MN

Email – [email protected]

Michael V. Testani

Office – Endicott, NY


Sreekanth Ramakrishnan

Office – Waltham, MA



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© 2011 ibm corporation isc smart lean an overview of ibm’s lean deployment strategy rochester, mn

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