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Transformative Change

Transformative Change

Fred in school learning transformative changeFred Flintstone was the prehistoric dad in an animated TV series that aired from 1960-66. Fred’s construction crane was actually a long-necked dinosaur, a phonograph needle was actually a bird with a pointed beak, and so forth.

In recent years, some of the most innovative technologies the world has seen have been adopted at an exponential rate. Now that everything, including business information, can be handled online via mobile or the cloud, it’s about time that we get rid of obsolete technology. In times of transformative change, it is not just our skills, tools, and practices that become obsolete. More fundamentally, our mental models become outdated, rendering them ineffective, misleading, or outright dangerous. I ask, are your business practices prehistoric? Have you ever asked a third party group of professionals to review your workflow? The call to action starts with you.

To make sure your business isn’t a cliché, or stuck in the past, ponder “Yabba dabba doo!” and Homer Simpson’s “D’oh!” The lessons we can learn about transformative change from animated cartoon characters.

People, Waste & My Wife

People, Waste & My Wife

coupon3My wife is an extreme couponing queen. I love it because, we can save an immense amount of money by using legitimate couponing methods, and keep a conservative stockpile of items that can pack our pantry or fit onto an extra shelf or two.  The key is, she spends her time only buying what we need for ourselves, our family and our donations without taking away from her job and other valued family tasks. “It is fun and rewarding,” Carol Selberg says. “You have to source the coupons, get them, cut them out, track them all, then look a little crazy at the grocery store.” In the end, the time she put into it pays off in measurable savings. We are feeding a family of 4 and with couponing, my wife has cut about $700 a month out of our grocery budget. It’s a lifestyle of savings, not waste!

Now how does all this craziness compare to savings in your business or the job you perform for your boss? There is a type of waste known as Acknowledge-People Waste. People are an organization’s greatest resource. When their time is misallocated or wasted, so is their potential. My approach champions the idea of having the right people, in the right place, doing the right work.  As you eliminate waste, you can begin to refocus your employees on higher value-added work within the S2P process.

Sourcing and procurement professionals are being asked to perform an increasing amount of work as staffing levels remain flat and budgets are constrained. However, applying Lean principles to your sourcing process will allow your department to reduce low value-add activity and relieve stress on your employees by shifting focus to higher value tasks. While traditionally used in manufacturing, the concepts and tools are versatile, applying to many industries and functions. A Lean aspect focuses on removing waste from your processes, while the Six Sigma component focuses on reducing variation.

With the help of Lean Six Sigma tools such as the DMAIC process, Value Stream Mapping, 5S Analysis, Root Cause Analysis and many others, procurement organizations can better serve their internal systems, add more savings to the bottom line and enhance their value proposition within the company. Keep in mind, Lean Six Sigma isn’t a cure-all or a onetime fix. It’s a mindset requiring staunch support from leadership, rooted in continuous improvement which recognizes the value of each employee in the process. In other words, it is a methodology of savings, not waste. FYI, my wife and her extreme couponing paid for our next vacation…ponder that!

The Voices

baseballForeign announcers have called American sporting events for years, but recently have been glorified for their electric calls. We might have no clue what they’re saying, but the calls are always entertaining. The Kansas City Royals defeated the New York Mets 7-2 to clinch the World Series early Monday. This is the team’s first World Series title since 1985. Mets first baseman, Lucas Duda’s, throw to the plate was off-line, and the crowd’s energy at Citi Field deflated as the Mets saw another late-inning lead slip away. These events sounded super crazy exciting when covered by South American commentators. Sunday’s NASCAR action of Matt Kenseth crashing Joey Logano was no exception. A Japanese announcer gave his account of the melee between the two at Martinsville with massive screams from the booth.

How do your Employees, Customers and Venders view your decisions when it comes to company policy? What can we learn from other cultures views on sporting events that translate into the culture of running our businesses?

Makes you ponder what your customers think of your marketing or what your employees maybe saying about the company’s direction. One thing is for certain, change is constant. If we are not keeping up with trends, market demographics and technology advancements, we could very well find ourselves out of business before we know it.

Some of the ways I have personally found to better understand the cultures of a company are to:

  • Spend 1-2 hours per week working with a different department lead.
  • Take an employee to lunch each week to learn more about them, their family and their views on the company.
  • Meet with one supplier/vendor per week to talk about your partnership and how you both can work better together to make the relationship stronger.
  • Visit by traveling to customers and really listen to their concerns and their needs. Tour their facilities and meet the teams that support the partnership.

Here’s an idea… just let passionate fans announce and give commentary. Everything is too dull and politically correct anyways. LOL….

We are not going to let fans call sporting events no more than we are going to let others have free rein of the business. But we are open to hear what others have to say. It’s called the voice of the people. The people that make your business what it is, the employees, customers and suppliers, those people should have the loudest voices. So get up from behind that desk and go hear the excitement of others!

“Listen twice as much as you talk and others will hear twice as much as you say.” –Nido R. Qubein-

Why didn’t we achieve success

try try again

Ask yourself “Why didn’t we achieve success?” Was it related to people, processes or technology? What was the catalyst for embarking on the program? Was it driven internally or by some key customers? Was the leadership committed to the program’s success? If so, how were they committed? How was “success” defined? Were the goals and timetables realistic? Was it solely about saving money or reducing headcount? Was the organization mature enough for this type of program. Did you provide context to your employees on why you were starting such a program? Were the employees equipped with the appropriate training and tools? How were projects selected? How were projects managed? Were the results tracked and shared? Was there a recognition component to the program? Regardless of the reasons, you owe it to your customers, your employees, your business, and yourself to try again. Maybe take more time on the front end to clearly articulate the vision. If at first you don’t succeed, Try Try Again….

What is Six Sigma?

What is Six Sigma?

My Disclosure: Six Sigma is not a simple system, it does not apply to every industry the same, and it can’t be taught in eight weeks for $489.00. It’s not a book, blog or video on the web.

DMAIC

Before, January 15, 1987, Six Sigma was solely a statistical term. Since then, the Six Sigma crusade, which began at Motorola, has spread to other industries that are continually striving for excellence. I was first introduced to the methodology in 1994 through VDO (the instrumentation company). I was trained to use Six Sigma in motorsports to set strategies, techniques, and tools for process improvement. At that time, this methodology was not used outside of manufacturing. Adapting some but not all of the processes then extended and evolved from a problem-solving technique to a quality strategy and ultimately into a sophisticated quality philosophy. These unique philosophies soon became a successful business strategy and were the turning points for NASCAR’s car of tomorrow. I have personally adapted and used these philosophies in raising two daughters, maintaining a healthy home and privately owned vehicle maintenance. I have used parts of the methodology in manufacturing hybrid buses, modifying shipping containers into useful habitable structures and to make many companies safer places to work.

Six Sigma has evolved over the last two decades and so has its definition. It has literal, conceptual, and practical definitions. As Six Sigma has evolved, there has been less emphasis on the literal definition (counting defects in products and processes) and greater emphasis on the conceptual and practical definitions. Six Sigma has grown into a full-fleged business improvement methodology that focuses an organization on:

  • Understanding and managing customer requirements
  • Aligning key business processes to achieve those requirements
  • Utilizing rigorous data analysis to minimize variation in those processes
  • Driving rapid and sustainable improvement to business processes

At the heart of the methodology is the DMAIC model for process improvement. DMAIC is commonly used by Six Sigma project teams and is an acronym for:

  • Define opportunity
  • Measure performance
  • Analyze opportunity
  • Improve performance
  • Control performance

Through my experience, I have learned that the disciplined use of metrics and application of the methodology even together are still not enough to drive desired breakthrough improvements and results that are sustainable over time. I have learned that Six Sigma is a top-down solution to help organizations:

  • Align their business strategy to critical improvement efforts
  • Mobilize teams to attack high impact projects
  • Accelerate improved business results
  • Govern efforts to ensure improvements are sustained

A Six Sigma Management System drives clarity around the business strategy and metrics that most reflect successful execution of that strategy. It provides the framework to prioritize resources for projects that will improve the metrics and it leverages leaders who will manage the efforts for rapid, sustainable, and improved business results.

In closing, Six Sigma is not a simple system, it does not apply to every industry the same, and it can’t be taught in eight weeks for $489.00. It’s not a book, blog or video on the web. It is a methodology! Something you live, breathe and use in your every thought. As cliché as it may sound, with some effort and focus you can retrain your mind and you, too, can change the world.

 

How much Coffee per employee?

Roasted coffee beansAn age-old office practice is chatting around the coffee machine; while coffee machines may have evolved over time, what happens around them hasn’t. Employees gather, refill coffee mugs, and engage in that old-fashioned thing: a conversation. This is why the vast majority of businesses (both small and big ones) prefer to have a coffee maker in order to keep all employees satisfied. When you see your employees gathering around the coffee machine you might think they are being unproductive, when in fact you should be thinking the opposite! This coffee machine will actually help you to gain more profit, but at what cost? This brings up the question: How much coffee per employee does it take to create a happy culture?

Coffee drinking began in the American colonies as early as 1689 in Boston, New York, and Philadelphia. In fact, the Green Dragon Coffee House of Boston was where the idea for the famous Boston Tea Party was conceived in 1773. Americans revolted against England’s tea tax, and the Continental Congress declared coffee the “Official National Beverage.” What better way to protest the unfair tea taxes imposed than to enjoy an alternate coffee beverage?

How to make the perfect cup of coffee is very controversy so here is my take: The most frequent and egregious problem is not using the right proportion of coffee to water, almost always not using enough coffee. The correct proportion to start with is 4ozs of coffee to 64ozs (1/2 gallon) of water. Others may say: exactly two (2) tablespoons (7 to 9 grams or 2 scoop of a standard coffee measure) of ground coffee beans for each six (6) ounces of water. For 4 cups (6 ounces each) of coffee, measure out 8 generous tablespoons (30 to 35 grams) of fresh ground coffee beans. Understanding that grind plays a big role, too. A coarse grind might only have a fraction of the surface area of a fine grind. And if you’re trying for ongoing, predictable results, you don’t use a small measuring device like a teaspoon… you use a larger one, like a level 1/4 cup or 1/2 cup metal measuring cup. There are lots of variables, the amount of water, the brewing method, the specific brewing device, the amount of coffee, the coarseness of the grind. Water temperature is another often overlooked factor. So basically in a nutshell, you get about 2 gals of coffee per one pound of beans.

How much should a cup of coffee cost the company per employee? When Starbucks came along and ushered in the coffee revolution, they charged $3-4 for something that had previously been sold for $1-2 (and cost them about 50 cents to make). For most businesses, entering a market this way would be a sure fire way to go bust in months. The price of a cup of office coffee is influenced by a lot of factors. And one of the factors that influence it most is the material cost.

Using this specialty drink as an example, if milk costs $3 per gallon, or 2.34 cents per ounce, and a drink contains 9 ounces of milk, the milk cost will be 21.1 cents. If the drink contains one double shot of espresso and a $7.50 pound of beans makes 32 double shots, the coffee cost is 23.4 cents. 1.25 ounces of syrup that comes in a $4.50 25.4 ounce bottle costs 22.1 cents. This gives a total food cost of 66.6 cents. Cups, lids and sleeves add additional cost and if they add up to 20 cents, the total cost of the drink would be 86.6 cents.

While some commercial coffee delivery services boost savings, overall cost can be a deterrent, though: prices can range from six to 60 cents per cup, depending on the quality and the brand of coffee. This can add up: coffee services for a 50-person company, for example, can cost several hundred dollars per month, depending how much everyone drinks.

I have not giving you the answer you are looking for, but I will give you the way to find an answer for your office. “Teach a person to fish and they will never go hungry”, I always say. A systematic approach to identify and eliminate waste through continuous improvement, tools and techniques are then applied selectively to eliminate the three sources of loss: waste, variability and inflexibility.

The DMAIC (Define-Measure-Analyze-Improve-Control) Methodology is a commonly used the Six Sigma tool designed to improve an existing process.

(1) Measure: data collection of product cost and usage

(2) Analyze: statistical methods data for trends and patterns

(3) Improve: find new suppliers, control shrinkage.

(4) Control: continuous monitoring, no problem reoccurrences

This philosophy encourages people to ask questions about every process and every step along the way to creating the final product. It is about asking tougher and tougher questions until quantifiable answer can be achieved that result in a change in behavior. Such questions cannot be answered without a planned approach to solutions.

Results change cultures (not the other way around!): People need to see how their values and behaviors impact their jobs and the organization, even around the coffee machine. Employees flourish when they know they are creating goods and services of incomparable value. In the end, an organization’s employee’s happiness is an indicator of how strong its values are.

  • Business measurements drive values.
  • Values determine how people work.
  • How people work determines profitability.

Now, you tell me, “How much coffee per employee does it take to create a happy culture”?