Explaining the Lean Management System Part 3 Managing for Daily Improvement

Lean Nation,

In this five-part blog series on introducing the lean management system, the series focuses on discussing some of the key elements of the daily management system.  This work, completed by organizational leaders at all levels, is essential in having a thriving improvement system.  
I find four elements are essential in engaging all employees, building the correct improvement habits /behaviors and sustaining improvement. 

 
These four include:
1) Process or production control - This is used to ensure standard work is performing as designed and to provide hourly insights into waste creeping back into the system
2) Daily tiered huddles - These are used to monitor outcomes of processes aligned to true north measures
3) Kamishibai task audits - These daily audits are used to satisfy your curiosity that things are operating as designed with special emphasis on key standards, best practices, compliance, safety, etc. 
4) Leader standard work - This practice to designed to ensure time is being spent on improvement by leaders at all levels of the organization. 

The second tool in the management system is the daily tiered huddle, also known as managing for daily improvement. Every organization is concerned with results. Results are how we measure success and frequently; compensation and promotions are based on the ability to deliver consistent, reliable performance. In a lean organization, results are the outcome of following good processes based on standard work and visual management. This is the focus of this month's blog.The first essential tool in the management system is known as production control.  Since many organizations are service organizations, this term has also morphed into process control.  This tool was covered in the previous blog.  Explaining the Lean Management System Part 2 Production (or Process) Control 

 

All managers get monthly reports, budget summaries, and statistics that try to make sense of the prior period’s activities, but correlating cause and effect is quite frequently difficult. We strive to follow our standard work, which is based on our best-known way of doing something. Standard work is our recipe, that when followed is the easiest, safest, fastest, and best way to do our work. We measure results to evaluate the effectiveness of our standard work. Our work is also visually managed so we can solve problems in real-time to be sure we are achieving our results.

The system used to get better every day is known as managing for daily improvement, or MDI.   For reference, some organizations also refer to this system as the daily management system (DMS). The MDI system tracks the key measures of a department, identifies, and prioritizes variances from plan, and develops and implements plans for improvement. This work is done daily by the entire staff. While management has the responsibility for the MDI system, everyone is expected to contribute toward the daily improvements. Imagine, your organization for a moment. If you are a medium-sized organization, you might have two thousand staff. What could your organization look like if each of these staff members were engaged in improving your core processes on a daily basis? Would this daily engagement help change your culture? Two thousand staff marching toward a shared vision can make a significant amount of change in a short period of time. Now compound this daily change over 90 days, six months, a year, five years. I think everyone can envision the end-state.

MDI begins with a thorough understanding of the true north measures of the organization. These are the same true north measures, we discussed earlier, that were developed through strategy deployment. The true north measures are cascaded down to the value stream level, and next to the department level. An example of the cascading of measures is shown below.

Dimension	Organizational True North Measure	Value Stream Measure	Unit Level Measure
Morale / Human Development	Implemented suggestions for the enterprise	Implemented suggestions for the program	Implemented suggestions for the unit
Quality / Safety	Reduce Defects by 50% across the enterprise	Reduce defects by 75% across the program	Reduce Defects by 80% on the unit
Service Quality	Compliments received for the enterprise	Compliments received for the program	Compliments received for the unit
Access	Reduce lead-time by 50% for the enterprise	Reduce lead-time for the program	Reduce lead-time by 75% for the unit
Cost	Reduce the staff hours per unit of measure by 10% across the enterprise	Reduce the staff hours per unit of measure by 20% across the program	Reduce the staff hours per unit of measure by 20% across the unit

It is important that the unit/department based, daily measures are aligned to the organizational true north measures. Our role as a leader is to establish the vision, allocate the resources to accomplish the vision, and inspire people to take action toward this vision.  Be sure you have aligned the staff against a common goal. Managing for daily improvement establishes the local level vision, creates the infrastructure to accomplish the vision at the unit level, and inspires the staff to meet the vision. What a great system!

The tools used for MDI include a performance board, a daily huddle, and a project management system for managing the improvements. An example of the performance board is shown below.

Each dimension of improvement (as defined from your true north measures) has a set of four charts. The first chart in the column is the year-to-date performance updated monthly with targets and actual performance. The second chart is month-to-date performance, updated daily, with targets and actual performance. The third chart is the sources of variation between the month-to-date plan and actual performance, and the fourth chart is the improvement plan. Some organizations call the improvement plan the kaizen newspaper, because it summarizes the kaizen (continuous improvement) activity needed to meet the daily target. 

These forms, when used as part of MDI are used to run experiments on our interventions or to do more formal improvement work using A3 thinking.

The board is located in a common area where the entire staff can easily see the content.    It is becoming more common for the MDI board to be electronic. I do not recommend this for a unit/department-based MDI huddle. The forms are designed to be rapidly completed using a pencil and I prefer the full-time transparency of the board. Obviously, if a cadre of staff is working remotely, then an electronic MDI board is necessary.

The data is updated daily. It is preferred to have a staff member update the data, as they are able to engage in the process and it encourages them to understand the measurement system and the supporting data.  The assignment for who updates the performance boards changes weekly. Once a shift, the entire staff huddles in front of the board for a 6–10-minute meeting. The meeting will be held to 6-10 minutes if the agenda is scripted. The typical agenda is as follows:

*  Morale or Safety measurement results, variance, and action plans - 1 minute discussion

* Quality measurement results, variance, and action plans - 1 minute discussion

* Access measurement results, variance, and action plans - 1 minute discussion

* Cost/Productivity measurement results and action plans - 1 minute discussion

* Unit/department level communication update – 1–5-minute discussion

After 15 seconds of daily review for each of the different measurement dimensions, ideas for improvement should be solicited and documented on the improvement plan. Results of improvement projects from earlier assignment should be briefly discussed as well as the idea that work should be incorporated into standard work and used by everyone. The improvements can be as simple as a suggestion that can be tested, to a more formal PSCA (plan-do-study -act) plan, all the way through a project documented on an A3.  The key is to be continuously engaging staff in improvement around the key measures of the unit aligned to the true north measures. Total transparency gives everyone an opportunity to be informed and to participate. It is through engagement and participation that the culture is changed. The meeting can be held at shift hand-over to ensure consistency in messaging and communication. This may differ depending on if the unit operates in a 24 X 7 unit or a single shift unit.

The huddle process is designed to occur at three distinct levels within the organization. The first huddle occurs with the staff and the staff line leadership. Line leadership can be the charge nurse or a unit team leader along with the supervisor/manager. This huddle would take on the day-to-day challenges and generate local improvement through quick wins and small PDSA cycles of improvement. The second huddle would occur between the line leader/supervisor/manager and the administrative director, and medical leadership. This layer of the organization would take on problems that can be influenced at the value stream level. Solutions at this level may involve A3 thinking and potentially kaizen events which when generated can be spread to the entire program. The third level of huddles happens between the value stream leadership and the executive team.  This layer of leadership resolves barriers between value streams or barriers that need to be addressed by corporate policy. The cascading huddles change the focus of the organization from monitoring results to managing for action and improvement. The cascading huddles occur best daily and should only take a few minutes. Resolving the open issues may take much longer than a day, but the key is trying to get better every single day!       

In the spirit of a three to a five-minute blog, I am out of time for this topic.  The key in the use of MDI is to be sure and huddle, discuss and generate actions to improve every single day.  If I had to pick one of the four tools to begin my improvement journey with, it would be MDI

The next blog will focus on auditing key elements of your processes using a tool known as kamishibai.   This helps ensure adherence to standard work.  

Lean Blessings,

Ron

Ron Bercaw, President, and Sensei

Breakthrough Horizons

www.breakthroughhorizons.com     

LinkedIn: https://www.linkedin.com/in/ron-bercaw-882a0a8/