Britvic puts the fizz into continuous improvement

A study was undertaken in 2011 into how CI performance could be improved through a focus on routine everyday improvement activity. Using published material as a lens, the study sought to identify the opportunities and barriers of implementing a system of leader standard work (LSW) to support continuous improvement. Also to consider what it would take to replace old habits with lean habits.

Answers were sought by examining and comparing best practice contained in published research with a case study of FMCG business leadership practices, routines and opinions. Qualitative data and emerging issues from two surveys of 110 leaders across three contiguous leadership levels provided material for discussing research questions.

Conclusions were drawn around potential improvements to FMCG CI kaizen activity:

• Bringing CI into a short interval time frame, and supporting tier 1 leaders in spending more time on maintenance activity and less on innovation.
• Conversely, senior managers replacing an excess of maintenance time with more time spent on strategy.
• Increasing process standardisation and pace of improvement through tier 1 leaders in working team leader roles rather than hands-off supervising roles.
• Giving viability to the CI programme by embedding standard work and leader standard work in the organisation.

WHAT ARE THE KEY SUCCESS FACTORS?

Emerging themes from the research selected for discussion were:

• LSW and the balance of kaizen flag activity;
• LSW and kaizen – a viable system;
• LSW and negative consequences;
• Prerequisites for LSW: stability, learning, competence, enablers and inhibitors.

LSW AND THE BALANCE OF KAIZEN FLAG ACTIVITY

A comparison of Imai’s ‘leadership flag’ activity (figure 1) and the FMCG supply chain case study proportions suggested that senior managers devote too much time to day to day maintenance activity and too little to innovation, breakthrough and strategy.

In contrast, tier 1 (first line leaders) and their managers do not focus enough on maintenance and kaizen activity, one tier 1 leader reporting 60% of their typical day and tier 1 on average spending 19% on what they interpret as ‘strategy’ work. Imai has a 0% strategy work mix for this tier.

Why the gulf between Imai’s definition of innovation and strategic improvement activity and the case study’s leadership opinion exists cannot be answered by data collected in the study. Some possible reasons and potential consequences are offered for discussion:

Possible reasons

• Structure: there is not a working team leader level in the leadership structure between the operator and first level ‘off the job’ manager;
• Interpretation: interviews with 12 of the 39 questionnaire respondents (four from each tier), identified part of the answer. Leaders considered strategic work as any activity that turned the annual supply chain plan into reality. Creating implementation plans, adjusting manning and updating shift patterns;
• Lack of focus on the process: the absence of working team leaders creates a distance between tier 1 leaders and their team members;
• No system of standard work exists in the organisation.

Potential consequences

• Lack of maintenance and kaizen focus: process variables, including leadership routines and focus, are not clearly defined. This in turn leads to waste (complexity, confusion, overlap, delay, under-performance), insufficient attention to system atrophy and failure to continuously improve;
• Lack of strategic focus at the senior level: failure to engage with the whole supply chain and be proactive about developing agility and supply chain effectiveness. Failure to build sufficient competence in all teams to create a successful future and eventual system atrophy. The strategy deployment process becomes ineffective: slow to react to market changes and to build the necessary flexible organisation to absorb change better than competitors.

LSW AND KAIZEN – A VALUABLE SYSTEM

A missing recursive link between operators and management (the working team leader) could become a blocker to kaizen activity and LSW. Without the stability and linkage to kaizen that operator standard work brings, LSW may not be viable.

LSW appears to have essential attributes to support kaizen in a viable systems way:

• It is fractal/recursive – each leader tier has self contained routine and the routines overlap with the next tier;
• It is autonomous and self aware with regards to identifying improvement opportunity and priority setting;
• It maintains its identity through set daily agendas and objectives;
• It has an escalation routine to bring chronic and serious issues to the attention of senior management;
• It is active in every layer and in every function, thus having the requisite variety to deal with a range of challenges.

LSW AND NEGATIVE CONSEQUENCES

Questionnaire responses from all leadership tiers showed there was little or no understanding of what ‘good’ standard work looks like. Barriers and negative consequences appear to be raised from this knowledge gap within the leadership tiers. While the case study leaders equate LSW to ‘diarising, bolting-down, stifling, and constraining’, there is possibly little likelihood of LSW fulfilling its potential to drive improvement. Figure 2 shows perceptions on LSW from 110 respondents.

Leaders also raised the concern that LSW could lead to a ‘tick-box’ approach to daily tasks with the added consequence that nonstandardised tasks could get missed or become lesser priorities. Tier 1 leaders had the highest levels of concern in these areas, with 54% of responses more or significantly more concerned in August than in April.

Emiliani’s recognition that a leadership role contains both process and leadership which are not synonymous may shed light on these survey findings.

Mann suggests that not all the leader and supervisor staff will be able to make the change from traditional to LSW. His experience shows that between one in five and one in 10 may not make the move, thus managing this outcome must be built into any implementation plan. Work with supervisors to understand their resistance to change. Mann suggests that making it ok to admit they do not have all the answers overcomes the credibility issues. Implementing LSW and the MIS system gives the opportunity for all to start at the beginning.

The primary research carried out in the study surfaced this issue, albeit in a small proportion of the leaders. In response to unprompted open questions, 9% of responses from tier 1 leaders related to ‘stresses the less capable’ and ‘does not account for leader’s style’. Countermeasures suggested in survey 1 included adopting a team or cohort approach where leaders could share responsibilities and work to their strengths.

PREREQUISITES FOR LSW, STABILITY, COMPETENCE, ENABLERS AND INHIBITORS

Prerequisites and stability

The primary research findings indicate that understanding what standard work is and is not is itself an important prerequisite for introducing LSW. As stated above, establishing operator standard work and a working team leader position are stability prerequisites for introducing LSW.

Competence

The primary research indicated that training of operatives was negatively impacted by difficulties to release both trainee and trainer, the lack of trainer competence assessment and training outcome assessments. These issues associated with the ‘training and competence delivery system’ are likely barriers to LSW adoption if left unaddressed.

Enablers and inhibitors

Survey 2 of the case study organisation identified a high level of agreement across all tiers on the enabler of 5S in sustaining standards. Levels of customer service and team escalation were also at or above 75% for all tiers, indicating their enabling influence for sustaining CI.

The most significant inhibitors emerging from the second survey were related to training. Making time for the trainee and trainer to achieve team competence in changed routines could act as a barrier to continuous improvement. Unlike organisations that have working team leaders using the TWI framework of job instruction, the case study system of training does not involve tier 1 leaders.

CAN OLD HABITS BE EXTINGUISHED THROUGH A ROUTINE?

THE DAILY ACCOUNTABILITY PROCESS

Going to the workplace to learn is a training methodology described by Spear. His four principles of learning appear to fit well with Mann’s lean management daily accountability process to provide both learning and improved performance:

1. There is no substitute for direct observation;
2. Proposed changes should always be structured as experiments;
3. Workers and managers should experiment as frequently as possible;
4. Managers should coach, not fix.

DAILY LINE COACHING CONVERSATIONS AND REINFORCEMENT

In commenting on this case study, Mann gave a view on reinforcement:

“I must admit I came into the professional world as a personality and social psychologist, so haven’t studied McGregor and have but a passing familiarity with Deming’s writings. But if you look to Rensis Likert, you’ll find an empirically supported point of view to this effect: until leader behaviour changes, nothing changes. I’d add this qualifier: nothing LASTING changes.”

Here, Mann is referring to Likert’s participative (group) ‘system #4’ of management characterised by a high degree of communication, trust, involvement in decision making and adoption of responsibility for goal setting and achievement.

Deming’s list of behaviours from SOPK transformation fit with fulfilling the leadership needs of standard work and kaizen:

• Set an example;
• Be a good listener and continually teach other people;
• Help people to pull away from their current practice and beliefs and move into the new philosophy without a feeling of guilt about the past.

The latter competence is especially relevant to the task of extinguishing a command and control organisation to one of a more delegated kaizen and leader standard work system.

IMPROVEMENT NEEDS TO BE INTRINSIC AND CONTINUOUS; SHORT INTERVAL CONTROL AND ATROPHY

Much is written about sustaining discontinuous ‘kaizen blitz’ and ‘six sigma project’ activity and of the need to have improvement part of daily life if it is to last. By its very nature, LSW, combined with the ‘experiments’ mindset of standard work, provides a built-in routine for essential sustaining and reinforcement of continuous small improvements (figure 3).

The survey results suggest that CI is seen as discontinuous ‘project’ and ‘intervention’ by leadership tiers. Short interval control (SIC) is just a control, rather than a countermeasure for system atrophy.

Mann suggests that measuring intermediate outcomes rather than final ones allows outcomes to be influenced before the finish. Within a TPM way of working, improvement and the competencies of delivering it operate quite often in real time, not ‘project time’.

Kaizen delivers line improvement and develops the line team too. Imai, Suzaki, and especially Japan Human Resources Association have all described its beneficial impact. Evolution of CI activity in a business could be considered as an expression of organisational learning.

TO CONCLUDE

The case study established that a framework of routine leadership synonymous to standard work for leaders may have the potential for viable performance improvement in a FMCG environment. Opportunities and barriers have been identified for the introduction of LSW to three connected leadership tiers of first line, supervisor and manager levels.

There is a beneficial relationship between short and longer cycle management routines and a FMCG business. A daily focus matches well with the need to maintain and improve a current best way. Working on frequent small improvements and delivering longer term improvements all support creating a more flexible and reliable supply chain. There is evidence too that insufficient attention to maintenance by first tier leaders and too little strategic work by the senior leaders could fail to correct system atrophy.

The role of leader as coach introduces the need for the leader to teach. The task of teaching itself develops the teachers’ understanding of the topic. The absence of both operator standard work and a working first line leader in the case study organisation introduces a disconnect to this mentor-mentee process and could fail to stem inevitable systemic atrophy.

The system of LSW contains effective drivers of behavioural change: repetition of standard messages, frequent opportunity for positive reinforcement and recognition, developing intrinsic motivation, as well as leading by mentoring and example. This collection of repetitious behaviour by aligned tiers of leadership could result in extinguishing old habits within the organisation and replacing them with lean habits.

How long will this take? For Mann, the estimated time is three to five years given a successful intervention programme. Deming provides a profound answer and a clear mandate for all leaders. It takes constancy of purpose and respect for the individual.