Hiking!

This week…I am hiking in the woods without my laptop albeit I do have my copy of  Monotasking by Staffan Nöteberg. I am continuing to focus on using shortlists, which has been a fairly easy transition and also implementing both the panorama cues and panorama sessions. The panorama cues and sessions have been useful up to the point that my dairy becomes wall-to-wall meetings.  I am trying to devise an approach for using panorama sessions in this scenario.  Suggestions?  While I am out in the woods I have re-published the summary of one of the most popular Re-reads, The Goal.  We will be back to Monotasking by Staffan Nöteberg next week.

Re-Read Saturday: The Goal: A Process of Ongoing Improvement Summary

Note: If you don’t have a copy of the book, buy one.  If you use the link below it will support the Software Process and Measurement blog and podcast. Dead Tree Version or Kindle Version

Chapters 1 through 3 actively present the reader with a burning platform. The plant and division are failing. Alex Rogo has actively pursued increased efficiency and automation to generate cost reductions, however performance is falling even further behind and fear has become central feature in the corporate culture.

Chapters 4 through 6 shift the focus from steps in the process to the process as a whole. Chapters 4 – 6 move us down the path of identifying the ultimate goal of the organization (in this book). The goal is making money and embracing the big picture of systems thinking. In this section, the authors point out that we are often caught up with pursuing interim goals, such as quality, efficiency or even employment, to the exclusion of the of the ultimate goal. We are reminded by the burning platform identified in the first few pages of the book, the impending closure of the plant and perhaps the division, which in the long run an organization must make progress towards their ultimate goal, or they won’t exist.

Chapters 7 through 9 show Alex’s commitment to change, seeks more precise advice from Johan, brings his closest reports into the discussion and begins a dialog with his wife (remember this is a novel). In this section of the book the concept “that you get what you measure” is addressed. In this section of the book, we see measures of efficiency being used at the level of part production, but not at the level of whole orders or even sales. We discover the corollary to the adage ‘you get what you measure’ is that if you measure the wrong thing …you get the wrong thing. We begin to see Alex’s urgency and commitment to make a change.

Chapters 10 through 12 mark a turning point in the book. Alex has embraced a more systems view of the plant and that the measures that have been used to date are more focused on optimizing parts of the process to the detriment to overall goal of the plant.  What has not fallen into place is how to take that new knowledge and change how the plant works. The introduction of the concepts of dependent events and statistical variation begin the shift the conceptual understanding of what measure towards how the management team can actually use that information.

Chapters 13 through 16 drive home the point that dependent events and statistical variation impact the performance of the overall system. In order for the overall process to be more effective you have to understand the capability and capacity of each step and then take a systems view. These chapters establish the concepts of bottlenecks and constraints without directly naming them and that focusing on local optimums causes more trouble than benefit.

Chapters 17 through 18 introduces the concept of bottlenecked resources. The affect of the combination dependent events and statistical variability through bottlenecked resources makes delivery unpredictable and substantially more costly. The variability in flow through the process exposes bottlenecks that limit our ability to catch up, making projects and products late or worse generating technical debt when corners are cut in order to make the date or budget.

Chapters 19 through 20 begins with Johan coaching Alex’s team to help them to identify a pallet of possible solutions. They discover that every time the capacity of a bottleneck is increased more product can be shipped.  Changing the capacity of a bottleneck includes reducing down time and the amount of waste the process generates. The impact of a bottleneck is not the cost of individual part, but the cost of the whole product that cannot be shipped. Instead of waiting to make all of the changes Alex and his team implement changes incrementally rather than waiting until they can deliver all of the changes.

Chapters 21 through 22are a short primer on change management. Just telling people to do something different does not generate support. Significant change requires transparency, communication and involvement. One of Deming’s 14 Principles is constancy of purpose. Alex and his team engage the workforce though a wide range of communication tools and while staying focused on implementing the changes needed to stay in business.

Chapters 23 through 24 introduce the idea of involving the people doing the work in defining the solutions to work problems and finding opportunities. In Agile we use retrospectives to involve and capture the team’s ideas on process and personnel improvements. We also find that fixing one problem without an overall understanding of the whole system can cause problems to pop up elsewhere.

Chapters 25 and 26 introduce several concepts. The first concept is that if non-bottleneck steps are run at full capacity, they create inventory and waste. At full capacity their output outstrips the overall process’ ability to create a final product. Secondly, keeping people and resources 100% busy does not always move you closer to the goal of delivering value to the end customer. Simply put: don’t do work that does not move you closer to the goal of the organization. The combination of these two concepts suggests that products (parts or computer programs) should only be worked on and completed until they are needed in the next step in the process (Kanban). A side effect to these revelations is that sometimes people and processes will not be 100% utilized.

Chapters 27 and 28 shows the results of focusing on the flow of work the bottleneck and only beginning work when it will be needed has improved the results at the plant,  Bill Peach pushes Alex for more using the threat of closing the plant as the stick to make the threat real.  Johan suggests cutting batch sizes in half as a way to improve performance and urges Alex to let the sales team know the plant can deliver quickly and quality.

Chapter 29 and 30 show that the plant has been able to deliver on the huge order from Bucky Burnside, the company’s largest customer, without impacting other orders or sacrificing quality. In order to meet the new demands on the plant, they reduced batch size again, which improved flexibility and efficiency. Burnside is so thrilled with the results and the staggered delivery schedule he flies to the plant to shake the hand of every production worker. Jons, the head of sales, confides to Alex that the success has led to the promise of even more business from Burnside. Despite all of the success, it is time for the plant review.

Chapters 31 and 32 deal with the plant review and the review’s immediate aftermath. Alex defends the changes he and his team have made to how work is done in the plant. The defense includes a summary of the theory of constraints. While Hilton Smyth is hostile, Alex’s performance has been noticed and Bill Peach tells him that he is to be promoted. Alex immediately reaches out to Johan who tells him that in the future he will need to trust his own judgement.

Chapters 33 and 34 reflect a shift in focus. With the plant saved, Alex is faced with a need to generalize the process that was used so that it can be used for different problems or scaled up to the next level based on his promotion. The problem is that finding a generalized process is hard and unless Alex and his team can find a way to generalize what they have done it will be difficult to replicate across the division.

Chapters 35 and 36.  Alex and his team struggle to generalize a process that Alex can use when he begins his new job based what the whole team has learned as they turned the plant around.  The process they find is:

1. Find the bottleneck in the flow of work.
2. Decide how to “exploit” the bottleneck (make sure you maximize the flow through the bottleneck).
3. Subordinate every other step to the bottleneck (only do the work the bottleneck can accommodate).
4. Elevate the bottleneck (increase the capacity of the bottleneck).
5. If the bottleneck has been broken repeat the process (a bottleneck is broken when the step has excess capacity).

As chapter 36 concludes the team reflects that the word bottleneck should be replaced with the slightly broader concept of constraint.

Chapters 37 and 38. Alex and his team continue to struggle to answer Johan’s final question.  During their discussions Alex and his team find that the plant has 20% extra capacity.  With the understanding that the plant needs (and can) to increase production, Alex, Lou and Ralph meet with Johnny Jons to explore new sales opportunities. Jons has a pending order that the plant can accept and is above variable cost of production.

Chapters 39 and 40 wrap Alex’s journey up.  In these chapters Alex finally answers Johan’s question, “What are the techniques needed for management?” During a  struggle to apply the five focusing questions to help the entire division leads Alex to the conclusion that, to manage, a leader must have the techniques to answer these questions:

1. What to change?
2. What to change to?
3. How to cause the change?

Alex realizes he has learned to think for himself which was the outcome Johan had hoped for when he stopped providing advice.

 

SPaMCAST 564 – Tame Your Work Flow, Part 2, A Conversation with Daniel Doiron and Steve Tendon

http://www.spamcast.net

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SPaMCAST 564 is part 2 of my conversation with Steve Tendon and Daniel Doiron.  We discussed their new book Tame Your Work Flow. Steve and Daniel ask the question “Do you need a high-performance enterprise management & governance approach improving planning, execution, and delivery while dealing with multiple projects, events, stakeholders and teams?”, the book and the interview probes potential answers. In order to answer the question, the three of us take a deep dive into applying Goldratt’s Theory of Constraints in the real world. Listen to part 1 before listing to SPaMCAST 564.

 

The Goal: A Process of Ongoing Improvement, Part 1

This is a re-play of our the re-read of The Goal. If you don’t have a copy of the book, buy one.  If you use the link below it will support the Software Process and Measurement blog and podcast. Dead Tree Version or Kindle Version 

I am running the poll for the next book in our Re-read Saturday feature.  We are nearly done with  The Science of Successful Organizational Change!  As in past polls please vote twice or suggest a write-in candidate in the comments.  We will run the poll for two weeks.  Let the voting begin!

 

The Goal: A Process of Ongoing Improvement, Part 18

I am traveling this week in India for the 13^th CSI/IFPUG International Software Measurement & Analysis Conference: “Creating Value from Measurement”. Read more about it here. In the meantime, enjoy some classic content, and I’ll be back with new blog entries next week.

 

Re-Read Saturday: The Goal: A Process of Ongoing Improvement. Part 18

I had intended to spend the last entry our re-read of the The Goal waxing poetic about the afterward in the book titled “Standing on the Shoulders of Giants”. Suffice it to say that the afterward does an excellent job describing the practical and theoretical basis for Goldratt and Cox’s ideas that ultimately shaped the both lean and process improvement movements since 1984.

Previous Installments:

Part 1       Part 2       Part 3      Part 4      Part 5 
Part 6       Part 7      Part 8     Part 9      Part 10
Part 11     Part 12      Part 13    Part 14    Part 15
Part 16    Part 17

The Goal is important because it introduced and explained the theory of constraints (TOC), which has proven over and over again to be critical to anyone managing a system. The TOC says that the output of any manageable system is limited by a small number of constraints and that all typical systems have at least one constraint. I recently had a discussion with a colleague that posited that not all systems have constraints. He laid out a scenario in which if you had unlimited resources and capability it would be possible to create a system without constraints. While theoretically true, it would be safe to embrace the operational hypothesis that any realistic process has at least one constraint. Understanding the constraints that affect a process or system provides anyone with an interest in process improvement with a powerful tool to deliver effective change. I do mean anyone! While the novel is set in a manufacturing environment, it is easy to identify how the ideas can apply to any setting where work follows a systematic process. For example, software development and maintenance is a process that takes business needs and transforms those needs into functionality. The readers of the Software Process and Measurement Blog should recognize that ideas in The Goal are germane to the realm of information technology.

As we have explored the book, I have shared how I have been able to apply the concepts explored to illustrate that what Goldratt and Cox wrote was applicable in the 21st century workplace. I also shared how others reacted to the book when I read it in public or talked about to people trapped next to me on numerous flights. Their reaction reminded me that my reaction was not out of the ordinary. The Goal continues to affect people years after it was first published. For example, the concept of the TOC and the Five Focusing Steps proved useful again this week. I was asked to discuss process improvement with a team comprised of tax analysts, developers and testers. Each role is highly specialized and there is little cross-specialty work-sharing. With a bit of coaching the team was able to identify their process flow and to develop a mechanism to identify their bottleneck(s) to improve their through put. Even though the Five Focusing Steps were never mentioned directly, we were able agree on an improvement approach that would find the constraint, help them exploit the constraint, subordinate the other steps in the process to the constraint, support improving the capacity of the constraint, then reiterate the analysis if the step was no longer a constraint. Had I never read The Goal, we might not have found a way to improve the process.

Perhaps re-reading the book or just carrying it around has made me overly sensitive to the application of the TOC and the other concepts in the book. However, I don’t think that was the real reason the material is useful. Others have been equally impacted, for example, Steve Tendon, author of Tame The Flow, and currently a columnist on the Software Process and Measurement Cast suggests that The Goal and the TOC has had a significant influence on his groundbreaking process improvement ideas. Bottom line, if you have not read or re-read The Goal I strongly suggest that you make the time to read the book. The Goal is an important book if you manage processes or are interested in improving how work is done in the 21st century.

I would like to hear from you! Can you tell me:

1. How has The Goal impacted how you work?
2. Have you been able to put the ideas in the book into practice?
3. What are the successes and difficulties you faced when leveraging the Theory of Constraints?
4. Do you use the Socratic method to identity and fix problems?

Re-Read Saturday Housekeeping Notes:

• Next week we begin the re-read of The Mythical Man-Month (I am buying a new copy today, so if you do not have a copy, get a copy today.  I will be reading this version of Man-Month.
• Remember that the summary of previous entries in the re-read of The Goal have been shifted to a new page.
• Also, if you don’t have a copy of The Goal, buy one and read it! If you use the link below it will support the Software Process and Measurement blog and podcast. Dead Tree Version or Kindle Version.

 

Re-Read Saturday: The Goal: A Process of Ongoing Improvement. Part 17

 

Epiphanies, the profound and sudden flash of understanding, in any field are rare; however, when they do happen they generally transform the person that has the revelation but don’t always have an impact on those around them. Sitting on a plane from Los Angles this week as I prepared to write this entry of Re-read Saturday, the person next to me pointed at my copy of The Goal and stated “I read that book, it changed my life.” As I have re-read The Goal I have been amazed at the number people that have stopped me to make sure I knew that they had read the book, also.  In today’s entry, the penultimate entry, Alex has an epiphany and discovers the answer to Johan’s final question to Alex.

Previous Installments:

Part 1       Part 2       Part 3      Part 4      Part 5 
Part 6       Part 7      Part 8     Part 9      Part 10
Part 11     Part 12      Part 13    Part 14    Part 15
Part 16

Chapter 39.  Bill Peach asks Alex to visit him and explain why his ideas are working.  Meanwhile, back at the plant all heck breaks loose.  The new orders have stressed the system.  Random problems in front of the bottleneck used up all of the buffer in front of the bottleneck steps.  The buffer had been used to keep he throughput through the bottleneck smooth and at maximum utilization. Once the buffer had been used up, the random problems caused work to get to the bottleneck in waves, causing the bottlenecks to be alternately starved and swamped.  This problem caused the plant to fall back to overtime and expediting work.

Alex leads a session with his team (soon to be Bob’s team) to find the root cause of the problem.  In the end the problem turned out to be that the new order had reduced the excess capacity in the plant.  Without changing the buffer in front of the bottleneck, the reduction in excess capacity meant that any shock to the system would quickly impact the bottlenecks which in turn would negatively impact the plants ability to deliver.  The team decides they need to rebuild the buffers to anticipate some level of shocks, using overtime and for the time being increase the delivery lead time.  Once a course was decided upon, Bob and “his” team put it into action.  Chapter 39 marks the transition of Alex to being division manager and Bob to plant manager.

Chapter 40.  Alex, now division manager, and Lou, now Alex’s division comptroller, discuss the problems they have in front of them as they make the commute home from division headquarters. The problems at the division level are seemingly insurmountable. Examples they discuss include a delay introducing new product models (even though there is demand) so that organization does not have to mark down old product currently in inventory.  Lou and Alex decide to apply the five step process to the problem: however, both agree, that while the problem is important it not urgent enough to need to break family commitments that evening both men had.  This is unlike earlier in the book when Alex and his team would practically live in the plant.  In the vernacular of Agile, Alex has discovered a sustainable pace.

The five step process is:

1. Find the constraint

1. Exploit the constraint
2. Subordinate every other step to the constraint
3. Elevate the constraint, then
4. Repeat if the constraint has been broken

When they reconvene in the morning they struggle with how to apply the five step process to the division.  They determine the constraints at the division level are the policies that drive the wrong behavior.  Both Alex and Lou struggle with how to apply the process when faced with concepts like policies rather than something tangible like a production process when the epiphany strikes.

Johan had left Alex with the task of answering, “What are the techniques needed for management?” The struggle to apply the five step process lead Alex to the conclusion that, to manage, a leader must have the techniques to answer these questions:

1. What to change?
2. What to change to?
3. How to cause the change?

Alex realizes he has learned to think for himself which was the outcome Johan had hoped for when he stopped providing advice.

Re-Read Saturday Notes:

1. I anticipate that the re-read of The Goal will conclude next week with part 18. Our next book will be The Mythical Man-Month (I am buying a new copy today so if you do not have a copy . . . get a copy today and please use this version of Man-Month).
2. Remember that the summary of previous entries in the re-read of The Goal have been shifted to a new page (here).
3. Also, if you don’t have a copy of The Goal, buy one and read it!  If you use the link below it will support the Software Process and Measurement blog and podcast. Dead Tree Version or Kindle Version.

 

 

Re-Read Saturday: The Goal: A Process of Ongoing Improvement. Part 16

As part of my day job I am often asked to help a team, project or department find a way to improve the value they deliver.  When dealing with knowledge work having a single, prescriptive path is rarely effective because even the most mundane product support work includes discovery and innovation. Once we have discovered a path it is important to step back and generalize the approach so that teams can use the process in a variety of scenarios.  I have found that developing a generalized approach is rarely as straight forward as changing the personal pronouns in the process to refer to another group. Regardless of this hard won realization, I still read posts and hear about people that are considering adopting best practices or procedures from other groups without tailoring.  Adopting a process, procedure or even a tool using an untailored, out of the box approach is rarely a good idea in knowledge work.  Alex and his team continue to search for a generalized approach that can be used to transform the entire division

Previous Installments:

Part 1       Part 2       Part 3      Part 4      Part 5 
Part 6       Part 7      Part 8     Part 9      Part 10
Part 11     Part 12      Part 13    Part 14    Part 15

 

Chapter 37. Alex and his team continue their daily meetings do discover the answer to the question “What are the techniques needed for management?” In Chapter 36 the team had settled on a generalized five step process which was:

1. Find the bottleneck,
2. Exploit the bottleneck,
3. Subordinate every other step to the bottleneck,
4. Elevate the bottleneck, then
5. Repeat if the bottleneck has been broken.

 

Ralph (computer guy) voices a concern that they really had not done step three.  After some discussion the team finds that the by constraining how work and material enter the process they really had subordinated all of the steps in the process to the bottlenecks.  Remember that the work and material entering the process had been constrained so the bottlenecks were 100% utilized (no more, no less).  During the discussion, Stacey (materials) recognized that the earlier red/yellow card approach the team had used to control the flow of work into the bottlenecks was still in place and was the cause of the problems she had been observing (Chapter 36). In order to deal with the problems caused by earlier red/yellow card approach and to keep everyone busy, Stacey admitted to have been releasing extra work into the process therefore building excess inventory of finished goods.  The back of the envelope calculations showed that the plant now had 20% extra capacity therefore they needed more orders to keep the plant at maximum capacity.  Alex decides go see Johnny Jons (sales manager) to see if they can prime the sales pump.

These observations led the team to the understanding that every time they recycled through the process they should have re-questioned and revalidated EVERY change they had previously made. The inertia of thinking something will work because it has in the past or because it has for someone else is often not your friend in process improvement!

Chapter 38. Jons, Alex, Lou (plant controller), Ralph and one of Jons more innovative salesmen meet at headquarters to discuss where they can come up with 10 million dollars of additional orders.  During the discussion it comes to light that Jons has a potential deal that he about to reject because the prices are well below standard margins. Alex points out that since the plant has excess capacity the real cost to produce the product is far lower than Jons is assuming (labor and overhead are already sunk costs). The plant could take the order and make a huge profit.  Alex and his team convince Jons to take the order if the potential client will commit to a one year deal.  They further sweeten the deal by committing to a quick deliveries (something other companies can’t emulate) in order to avoid starting a price war.  Jons agrees to accept the order as the potential client is well outside of the company’s standard area of distribution therefore will not impact the margins they getting on other orders.  On the way back to the plant Alex, Lout and Ralph reflect that they had just seen the same type of inertia that the team discovered the previous day in their process improvement approach and that Alex’s new role in changing the whole division will need to address even more organizational inertia.

Later Alex and Julie (wife) reflect that the key to the management practices Alex is searching for lie in the application of the scientific method.  Instead of collecting a lot of data and making inferences, the approach Johan had taken begins with a single observation, develops a hypothesis, leverages if-then relationships and then tests those relationships.  Alex searches popular scientific books for inspiration to his management questions.  When they discuss the topic again, Julie, who has continued to read the Socratic Dialogs, points out that they follow the same if-then pattern that Alex has described as Johan’s approach.

Re-Read Saturday Notes:

1. I anticipate that the re-read of The Goal will conclude in two weeks with part 18. Our next book will be The Mythical Man-Month (I am buying a new copy today so if you do not have a copy . . . get a copy today and please use this Man-Month).
2. Remember that the summary of previous entries in the re-read of The Goal have been shifted to a new page (here).
3. Also, if you don’t have a copy of the book, buy one.  If you use the link below it will support the Software Process and Measurement blog and podcast. Dead Tree Version or Kindle Version

 

 

Re-Read Saturday: The Goal: A Process of Ongoing Improvement. Part 14

I recently had a long discussion about whether it was more important to solve an urgent and specific business problem or to create a culture of process improvement that would avoid crises in the future. My colleague described the immediate problem as threatening to the entire organization. The obvious answer was that the immediate problem needed to be addressed. The question then became whether consultants should be engaged to provide the answer or to help the organization discover the answer. I suggest that doing the later actually negates the first question by generating a solution to the immediate problem while creating a culture of process improvement. Johan in The Goal illustrates this nicely. He helped Alex and his management team discover the answer while building a culture of process improvement.

Part 1       Part 2       Part 3      Part 4      Part 5      Part 6      Part 7      Part 8    Part 9   Part 10   Part 11  Part 12
Part 13

Chapter 33 begins with Alex working on assembling his new team. He begins with Lou, the plant accountant. Before Alex can ask him to come with him, Lou explains to Alex that another old measurement has been causing problems with how the plant is perceived and how it behaves. Inventory is accounted for as asset on the balance sheet even though inventory is a liability. Since the plant has become more efficient it is carrying less inventory therefore reducing the assets reported on the balance sheet. During the period of time that inventory was drawn down to the levels needed by the more efficient process the plant looked as if it was increasing the amount of liabilities. Now that a new equilibrium in inventory had been established the problem was not an issue, however Lou notes that, “measurement should induce the parts [of the process} to do what is good for the organization as a whole.” Lou is ready to help Alex and is pumped to focus on building a better measurement program.

Alex approaches Bob Donavan, the plant production manager, to become the division’s production manager. Bob points out that the Burnside order that sealed Alex’s new deal was engineered. Alex and his management team had not just “taken” the order, but rather had worked out the best way the order could be delivered and then had negotiated a deal that benefited everyone. Bob wants to find a way create and document a process in which the plant and engineering can be an integral sales. A process and documentation is needed so that the plant leadership team does not need to be intimately involved in every order. Bob Donavan wants to stay at the plant and become the new plant manager and wants Stacey in materials to become the new production manager.

They find Stacey working on a new potential problem. Stacey has identified that there is a class of resources called capacity constraints resources (CCRs). CCRs are resources that have constraints, but are not bottlenecks. As the processing of work through bottlenecks is improved, CCRs risk becoming bottlenecks which Will negatively impact produvtuvity. Process improvements need to be continually be made across the entire system.

Alex finally turns to Ralph. Ralph points out that he now feels like he is an important part of the team rather than just the computer nerd in the corner. He walks Alex through his ideas of building systems to support engineering, managing buffers and for better measurement.

The experimentation that led to changing how the plant works has changed how Alex’s management team thinks about their jobs. Asking questions and experimenting with changes to the process those questions generate has yielded a much higher level of involvement and commitment.

Chapter 34 jumps to Alex and Julie sitting their kitchen drinking tea. They are discussing how each of Alex’s current team is exploring ideas that might not have an answer. Julie points out that if Johan had not cut him off by suggesting he trust his own judgement Alex might be reaching out to Johan for suggestions rather than trying to work on them as a team.

The discussion of Johan brings them back to Johan’s last question to Alex. Johan had asked, “What  are the techniques needed for management?” Julie suggests that since the questions that Alex’s management team each is currently working on will be around after Alex moves to his new job, why not engage them in answering Johan’s question. They have as much of a stake in the answer as Alex does!

Alex pulls the team together and they spend their first session discussing and drawing the many ways Alex could determine what is going on when he start the new job. There are many ways to answer the question of what is going on. Each yields a different answer based on differences in perspective, approach and an arbitrary order of arranging the results. The wide range of ways to think about the problem make it difficult to actually determine a solution. The group agrees to meet the next day.

Chapters 33 and 34 reflect a shift of focus. With the plant saved, Alex is faced with a need to generalize the process that was used so that it can be used for different problems or scaled up to the next level based on his promotion.

Remember that the summary of previous entries in the re-read of The Goal have been shifted to a new page (here).   Also, if you don’t have a copy of the book, buy one.  If you use the link below it will support the Software Process and Measurement blog and podcast. Dead Tree Version or Kindle Version

 

Re-Read Saturday: The Goal: A Process of Ongoing Improvement. Part 13

This week I attended and spoke at the CMMI Global Congress. It was a great conference, and as with most conferences, the conversations in the hallways were as interesting as the presentations (including mine). I had a lot conversations about lean, Agile and scaling Agile, and while the attendees as a whole saw the value, there are still a few that view Agile and lean concepts with derision. These conversations, in conjunction with today’s re-read segment of The Goal, led me to consider whether much of the underlying resistance was being generated by fear; in particular the fear of discovering that what you know is no longer relevant. People facing that fear generally react in one of two ways: reinvention or rejection. In today’s segment Hilton Smyth chooses one of those options. . .

Part 1       Part 2       Part 3      Part 4      Part 5      Part 6      Part 7      Part 8    Part 9   Part 10   Part 11 Part 12

Chapter 31 Alex appears for the plant review, which is being chaired not by Bill Peach (Alex’s boss) but rather Hilton Smyth. Hilton is the assistant division controller. When Alex suggests that they wait for Bill Peach, Hilton indicates that he will not be coming and that his (Hilton’s) report will tip the scales on whether the plant stays open or not. The early exchanges clearly establish that Hilton does not buy into the turn around that Alex and his team have engineered. Alex reiterates the three core findings that have driven the turn around.

1. Instead of balancing capacity with demand, they are focused on maintaining and improving the flow through the plant.
2. For resources that are not bottlenecks, the level of activity from which the system is able to profit is not determined by individual capacity, but rather by some other constraint.
3. Utilization and activation are not the same.

Hilton believes that Alex’s deviations from the tried and true formulas for batch size, capacity utilization and per unit costing are hiding problems that will cripple the plant in the future. Those tried and true formulas are central to Hilton’s perception of his own relevance, and he can’t see that with both profits and plant throughput up and inventory down that the plant is now on very solid footing. The report to Peach will be bad.

After the meeting, Alex decides to confront Peach. Peach listens as Alex tells him that Smyth would not listen to reason. Peach summons Jons (head of sales), Ethan Frost (division controller and Smyth’s boss) and Smyth. When they are assembled, Peach announces that Jons, Frost and himself have been promoted, and that Alex will also be promoted to head the division. While unstated in the book the inference is that recent profitability and the new orders from Bucky Burnside have made quite the stir at corporate. (In my head I could hear Smyth blustering, as much of his previous knowledge and experience became less relevant).

The chapter ends with Alex reaching out to Jonah to ask for help running the division. What he receives is a congratulation and advice to learn to trust his own judgement rather than to needing outside support.

Chapter 32 uses Alex’s and Julie’s celebration dinner as a backdrop for a discussion about the promotion as part of a journey and Johan’s method of coaching. Johan didn’t just provide answers to the questions Alex posed, but rather pushed Alex  in the right direction and made him and his team work for the answers, much like the Socratic method of generating critical thinking based on asking and answering questions.  This journey helped Alex generate ownership in new concepts that flew in the face of what he and his team previously thought to be true. The struggle to generate answers gave Alex and his team the courage to implement their new ideas. It should be noted that the feedback that their early successes generated also helped generate the courage to try further experiments (this dovetails nicely to the ideas in Kotter’s Leading Change – an earlier re-read).

Remember that the summary of previous entries in the re-read of The Goal have been shifted to a new page (click here).   Also, if you don’t have a copy of the book, buy one.  If you use the link below it will support the Software Process and Measurement blog and podcast. Dead Tree Version or Kindle Version

 

Re-Read Saturday: The Goal: A Process of Ongoing Improvement. Part 12

Several weeks ago I was discussing why a team was having trouble completing the work that they committed to delivering in a two week sprint. The team felt that one solution was to shift to a three week sprint, in other words to increase batch size be 50%. I asked the team to identify the problem that was causing the problem. While calendar time is a constraint, the bigger problem turned out to be the size of the user stories they were accepting. The team settled on trying an experiment of thinly slicing their user stories and reducing their sprint duration to one week. The combination of smaller stories enforced by an even tighter calendar constraint is a reduction in batch size. They have been at the new cadence for four weeks and have delivered on their commitments for last three sprints and have decided to continue the “experiment” for the foreseeable future. Cutting batch size is a solution that can work in manufacturing and in software development.

Part 1       Part 2       Part 3      Part 4      Part 5      Part 6      Part 7      Part 8    Part 9   Part 10   Part 11

Chapter 29

The plant shows incredible progress. Cutting the batch size in half led to less idle time for non-bottleneck resources, where idle time exists it has been spread out more diffusely, and work is flowing through the plant faster with lower overall inventory. However the classic measures, which focus on cost per step in the process rather than the system cost, do not show the improvement. The additional set ups have associated costs and effort which are a problem. Even through the plan is making more completed product with less inventory, the metrics do not show the improvement. Alex and his staff decide to change the measurement basis from 12 months to 2 months, with the rationale that the new process now in place is more endemic of how work will be done going forward. The decision is made despite the agreement that “Frost”, the Head of Accounting at Corporate, and Alex’s Boss, Bill Peach will not approve of the change.

Chapter 29 ends with Jons, the head of sales, bringing Alex a new order for 1,000 items. The client is offering the order to Alex’s company if they can deliver in a month. Jons believes that IF the plant can deliver, the client will shift all of its business to plant. The Alex and his team consider the order. They decide to not sacrifice everything else by not expediting the order, but if the client will accept a counter proposal of a 250 items every week for four weeks beginning two weeks after signing the order they can deliver. In order to deliver the order Alex and his team will need to order components for the item from another company (and have the parts shipped via air freight) and to cut the batch size in half again. The client likes the idea of the staggered deliver (they probably can’t use all 1,000 instantly either).

Chapter 30

The big order, or should we say four smaller orders, is moving well. The first couple of installments have been made on time and Alex’s staff foresee no issues with the rest. The continued reduction in batch size helped the plant meet its goals and has continued to improve the flow through the plant. The plant’s metrics show that inventory is down and throughput has doubled.

Alex receives two messages from Bill Peach. The first is praise for meeting the order and the second is a summons for a plant review. While preparing for the review, accounting discovers the change in the measurement basis (form 12 months to 2 months) that the plant implemented without permission and reacts badly. Lou, the plant accountant, is reprimanded and the numbers are restated. The plant has not met Bill Peach’s demand for a 15% increase.

Jons and Burnside, the client for the big order, arrive at the plant unannounced in a helicopter. They immediately head into the plant. After validating that the last shipment went out on time and without a quality problem Alex heads into the plant to find Burnside shaking every person’s hand he can find. The ability to deliver on time with great quality has made the plant a huge friend, and Jons confides to Alex that Burnside will sign a huge order next week. Jons goes on that with the plant’s quality and cycle time (the time between accepting an order to delivery) they will blow the competition away.

The chapter ends with Alex and Julie, Alex’s estranged wife, deciding to get remarried. All seems to be going well, but there are still 10 chapters left in the book . . .

The summary previous entries in the re-read of The Goal have been shifted to a new page (click here).   Also, if you don’t have a copy of the book, buy one.  If you use the link below it will support the Software Process and Measurement blog and podcast. Dead Tree Version or Kindle Version