Over the last few months the topic that has intrigued most people and what has generated the most questions has been around demand that is generated due to a failing in the process/system/organisation, commonly referred to as Failure Demand, Bad Costs or Rework (I will refer to these terms from now as Failure Demand).

They 3 main things I have been asked are:

What is my take on this?

How can it be tackled?

How do you visualise it?

Therefore the aim of this post is to address these 3 questions from my perspective

My take on this ‘Failure Demand’

What is it? Failure demand as I define it, is any demand that is generated due to a failing in the process/organisation/company – collectively these are often referred to as an overall system, can you can visualise your whole operation as a system, the inputs, the outputs, the interdependent processes etc?

This type of demand is rife in Service Industries and there are many organisations who deal with this demand as their sole purpose.

Let me ask you a question, do you perceive any of the following to be failure demand ?

Person A who is going to the Hospital/Doctors for an appointment apart from to the maternity functions?

Person B who has got themselves into debt and chooses to use a Debt management company?

Person C who has just been put into prison?

Person D calling a contact centre to report a fault?

Person E progress chasing their bank loan application?

Person F has broken down at the side of the road and calls their roadside recovery company?

If we look at the definition above then all of the examples I believe to be ‘Failure Demand’ however not all the organisations would want you to remove 100% of that demand i.e. the debt management company or roadside recovery company. So this comes back to your purpose (step 2 of the “Your Way” methodology)

How can it be tackled?

Once you have defined your purpose as an organisation you know whether you should be trying to remove this type of demand wholly or not.

A large organisation in the UK I have supported with this, had a customer failure journey costing them over £500m per year and their actual purpose was to generate revenue by providing a working service and not expecting it to fail and having to fix it, so that was £500,000,000 wasted each year.

The approach I would take to tackling it follows a 4 step approach which focuses on Root cause analysis, this has to be completed by/with the management team and more importantly the people who work the process. I would do this initially under trial conditions to prove the approach before allowing everyone to capture everything as you will need to refine it as you gain a greater understanding of the specifics that are hurting you and generating failure demand.

The 4 steps:

1 – Define and agree an understanding of what you mean by the term ‘Root Cause’.

2 – Review with the team the way data is currently captured and does it give you the agreed root cause or not

3 – Develop a data capture mechanism to capture the root cause reasons for demand, I would have a high level selection criteria (to make analysis easier) followed by a box allowing for verbatim comments to capture the true root cause.

4 – Visualise and review the data, feeding back to all interested parties, identifying any opportunities for improvement and implement those quick wins

As you can see the above aligns to the GIVE model, the GIVE model is the approach that will allow you to improve your organisation and that’s why we ensure it underpins everything we do.

How do you visualise it?

The visualisation of failure demand is dependant upon your operation, if your operation is small to medium and you receive growth and cost demand then I would encourage you to plot your findings on a Value/Irritant model this is shown in “Your Way”. However if it is majority failure demand you receive in a particular department, I would say a run chart to display the quantity and a pareto to allow you to prioritise the main reasons for demand followed by a sheet to enable you to problem solve, showing problem,cause & solution.

Once you have visualised it remember the E of GIVE is to:

Enable those who work the process to ELIMINATE it, and continue this cycle ensuring it becomes business as usual activity.

On with the improvement

Lee

 The only real failure in life is the failure to try…

Although the above is true with life, with Lean there are some things that can help you avoid failure. 

We have been made aware of many businesses over the last few years and witnessed in our early days as employees of large companies, struggling Lean transformations, this has allowed us to develop our 21 step “Your Way” methodology and understand how to avoid failing and for ourselves that failing was part of the learning process. However we don’t want you to fail, we want you to use our experience to deliver a lean transformation effectively and successfully, where you are the enablers to your achievement of YOUR goals.

4 Things you can do to help prevent failure:
Compelling need to change – For most change to be successful and for people to buy into it, there needs to be a reason to change. I have seen these be created by management rather than waiting until something is serious enough to necessitate change. So to prevent the “why do we need to change?” question being asked. Have a think about the “What’s in it for me” for individuals at each level, if things change how will it help them? And develop a need to change if there isn’t one already in this economically challenging environment,

Senior leadership commitment and role modelling required behaviours – If you are in a senior position, you need to change too. The shop floor or the office or the workshop are generally a mirror of the effectiveness of the manager. If you think the office/warehouse etc can improve then so can you. To introduce Lean and other Continuous Improvement methodologies successfully generally require managers to Go & See the work taking place, to fix problems where they occur rather than from behind a desk etc.

You definitely need a practise what you preach mentality a one off is not good enough it needs to be consistent and the behaviours repeated at all levels

“We are what we repeatedly do. Excellence then is not an act, but a habit.”

Aristotle
Engagement of the people doing the work – It is commonly known that the people who know most about a process are the ones who do it each day. So why are they not utilised more to be empowered to make the changes, this may require workshops with representatives from each step of the Value Stream. Engage the people who work the process, empower them to develop their improved standards and working practices and create a mechanism to enable them to continuously improve.

Standardise the principles and not necessarily the tools – A lot of consultancies have developed successful lean approaches however they are not always transferable to each team in each company they engage with therefore:

Before taking an off the shelf solution and letting consultants “do to”you. Understand fully the principles behind Lean & Continuous Improvement.

We see these as:

To identify waste → To visualise waste → To remove waste

Have a look at the GIVE model (GIVE Model) I created this to give you an approach to help you reach your goals, if you need further support try out “Your Way” methodology here: “YOUR Way” it is not tool based it is a series of 21 questions that enable you to reach your goal by identifying, visualising and removing waste as well as influencing the desired behaviours required to sustain the improvement.

Thanks for reading & remember if you want to join the other 2500+ people you can follow us on Twitter here:

http://twitter.com/leansecretsuk

On with the improvement

Lee

What is the GIVE model, why not just PDCA?

During my Lean career I have been a strong advocate of the PDCA cycle and there has definitely not been enough stressed on its importance in some of the roll outs I have witnessed. One of my mentors stressed to me in the early days that. “PDCA is a fractal of Lean” basically in everything we do at every level PDCA is applicable and should be followed. Whether it be a 5S standard (or any standard), a SOP, QCD process performance measurement, a lean implementation plan or a team meeting etc. then it should be followed to ensure we continuously improve. That one cycle I would argue is the single most important factor in enabling any business improving. In my experience companies believe they are OK at planning and the doing however the checking and acting appear to be neglected in a high percentage of occasions.

Despite all this I have not developed GIVE model to replace PDCA as I see PDCA as the glue that holds the GIVE model together:

Step 1 – Goal – Where do you want to get to? What do you want?
Without intentionally oversimplifying the PLAN in PDCA to understand truly where you want to get to you need a PLAN

Step 2 – Identify – Where you are now & the blockers stopping you from achieving your goal?
This is all about the Do & Checking part of PDCA but ensuring you capture and understand where the gaps are between the PLAN and the DO.

Step 3 – Visualise – & quantify the blockers stopping you.
Now you know what is stopping you, lets make it visible, only when you see a problem can you fix it, or remove the blocker

Step 4 – Eliminate– The main things stopping you from achieving your goal and continue to do all the things that are aligned to your goal
This is all about the removing the blockers and to do this follow PDCA

This is why we have created the GIVE model as it is fully supported by PDCA and has not been developed to replace it, this model is a fundamental part of the Lean Secrets “Your Way” methodology.

Feel free to sign up to our newsletter or GIVE the full Lean Secrets “Your Way” methodology a go if you are having trouble making a sustainable change to your business/team.

Download the GIVE model for FREE here:
GIVE model

You can also follow us on twitter @Leansecretsuk

On with the fun

Lee

Why Lean Secrets

Lean Secrets are a forward thinking partnership committed to enabling you to make sustainable improvements to your team/business/organisation.

We have developed a 21 step “Your Way” methodology to provide you with all you need to make significant steps to improve your profits by reducing your operating costs. The methodology incorporates Lean and Systems thinking but its foundations remain with the Toyota Production System. As well as focussing on a proven structure supported by tools it helps you to identify if you are delivering what your customers want, what behaviours you require from your people and how to influence those behaviours while ultimately reducing your blockers to achieving your goals.

The methodology we are offering comes with a full money back guarantee because we are that confident in what we are offering. The methodology incorporates the PDCA cycle th rough our GIVE model.

We also offer a full consultancy if you feel that’s what your company requires

We hope you have as much success using this as we have and remember we are committed to enabling and supporting you to reach your companies goals in these especially trying global economical times.

Feel free to sign up to our newsletter or GIVE the full Lean Secrets “Your Way” methodology a go if you are having trouble making a sustainable change to your business/team.

You can also follow us on twitter @Leansecretsuk

On with the improvement

Lee & David