Using Lean to Engage Employees andDelight Customers

Cindy SwankASQ Charlotte: Quality Conference of the CarolinasApril 2015

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Service Value Commitment - A way of life

Virtuous Cycle

More engaged employees

Increased productivity, efficiency and enhanced service

value to customers

Greater customer success and loyalty drive more business

Greater financial flexibility

Financial resource allocation:- Shareholders- Customers - Employees

- Comp/Rewards- Employee Selection- Work Environment

- Process Design- Job Design- Training- Employee Tools

Investment in:

Without a linkage to strategy, lean is viewed as just another exercise in management by best seller.

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ENGAGING EMPLOYEES

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To begin, one must have a sense of urgency

It’s hard to get people to change without a burning platform

People are reluctant to move outside of their comfort zone

There is almost a natural law that people will gravitate back to where they were before the change

Change of any kind is scary and unsettling

Creating awareness and desire first, leads to sustainability. Check out the ADKAR change model for more information.

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People like being firefighters

BUT WE NEED THEM TO ACT LIKE SCIENTISTS!

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Making problems visible sounds good in theory

IS THIS REALLY WHAT THEY MEANT???

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People learn a much different approach early in life

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Frontline is understandably fearful

• Lean = Mean

• Visible metrics used to scapegoat

• Passing fad not worth investing in

• Job loss and change itself

• Takes away pride in working around broken processes

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•Regular meetings with management ensure voice in change process

•Suggestions incorporated to improve process

• Ideas rewarded not recovery efforts

•White boards make individual contributions visible

But they quickly embrace empowerment

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•Consider aggressive goals unrealistic

•Reanalyze numbers

•Challenge expectations

•Fear major disruptions in service

•Worried about sustainability

•Recognize dramatic change required of them

Functional managers are very skeptical

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• Proves goals are attainable

• Visible to all

• Changeable on the fly

• Minimizes impact

• Offers opportunity to practice

• Results in positive feedback

Pilots or model cells reduce manager’s concerns

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Leaders struggle to stop telling and start teaching

If the learner hasn’t learned, the teacher hasn’t taught.

- John Shook

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Great coaches constantly pace the sidelines, evaluate performance, review stats,

watch the clock, make adjustments and talk to their players.

It’s a whole new game!

Comparing lean leaders to coaches helps

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“We’re o.k.” ConvictionAwareness Courage Action

“Someone ought to do something about…”

“We could fix it if we…”

“If I had my way, I would…”

“I said it would work, didn’t I?”

Inform on situation,make problems

visible

Acting as a trusted advisor makes achieving buy-in easier

Evaluate options,solicit ideas

Build commitment,remove barriers

Give incentives,praise successes

TrustedAdvisor

Role

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Recognize that your loudest critics usually become your

most fervent disciples

Point to Ponder

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CASE STUDY

NEW BUSINESS APPLICATIONSHow to Delight Your Biggest Customer

While Engaging Employees

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Started by creating a value stream map in a crunch

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The next more “portable” iteration

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Using root-cause problem solving techniques, the team identified many opportunities for improvement

Scan, Index

App Data Entry

Exam Ordered

First Review

Order Addl’ Reqs

UW CM Review

Call Out Offer

Final Action/Issue

SF Agent Customer

3 Days1 Day

0 Days 22 Days7 Days

5 Days1 Day

42 Days9 Days

Exam Results

12 Days0 Days

8 5116

State Farm DSO Improvement Value Stream Map

Application is confusingHigh Not In Good Order rate

Often difficult to schedule

Lab/ExamOrdered

ScheduledAppt

Exam Occurs

Exam/LabsResults

8 Days0 Days

5-6 Days2 Days

10 Days5 Days

22-23 Days7 Days

66 24 27

1st APS Ordered

1st APS Received

18 Days9 Days

2 46

EXAM PROCESS DETAIL34% Have APS Ordered

Reduce to 1 day

“Linked” case signals work required

Visual tray system moves cases in real

time

Agent schedules

exam

Work w/ vendor to

reduce time

Eliminate complex

cases from speed

Core and speed desk have similar process and process

performance

Refine Speed selection criteria CM approves

for issue on clean cases

Core aggressively

track and resolve

Autoissue clean cases

X

XX

X

Simplify App/eApp

IMPROVEMENT VALUE STREAM MAP

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Scan, Index

App Data Entry

First Review

Order Addl’ Reqs

CM Review

Call Out Offer

Final Action/Issue

SF Agent Customer

1 Day 0 Days 7 Days 1 Day 9 Days

Exam Results

0 Days

State Farm SPEED TO BE Value Stream Map

Exam Occurs

Exam/LabsResults

2 Days5 Days 7 Days

EXAM PROCESS DETAIL

Only Clean applications with Labs and Exams within certain

limits are Speed cases

Exam is already scheduled

Exam scheduled before submission – days from ADE to

Exam occurrence is lower

SPEED DESK TO BE VALUE STREAM MAP

Implemented improvements reduced cycle time from 41 to 9 days

78%reduction

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Encouraging suggestions is not as easy as it seems

“Why bother? They never do anything with them. I am still waiting to hear about the one I submitted three years ago.”

“Isn’t that management’s job?”

“Why would I want to fix a problem when I keep getting rewarded for my creative workarounds?”

“Are you crazy!!! I don’t want to be accused of brown nosing!!”

“I don’t think they ever check the box. And by the way, do you know why the box is locked?”

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Key is providing an opportunity to be heard and making listening visible

3. Ideas are worked on.

1. Ideas are submitted.

2. Ideas are advanced or rejected.

4. Ideas are implemented.

Remember the fingerprint factor – Keep and manage ideas in their original form

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Case Manager

Huddle Area

Manager

Daily Metrics

Visual Controls

Underwriter

Team Idea Board

The team quickly saw the benefits of moving from sitting in functional areas to being organized as a team

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The team moved managers out of their offices and conference rooms right into the cell

MANAGER

CASE MANAGER

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The team implemented ways to make a previously invisible process and status available for all to see

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Simple visual metrics drove team root cause problem solving daily

“Society has reached the point where one can push a button and be immediately deluged with technical and managerial information. This is all very convenient, of course, but if one is not careful there is a danger of losing the ability to think. We must remember that in the end it is the individual human being who must solve the problems.

-- Eiji Toyoda, Toyota Motor Corporation, 1983

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As employee ideas were implemented real improvement emerged

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

6/20 7/18 8/15 9/19 10/17 11/21 12/19 1/16 2/13

0-22 Days 23-40 Days 41-60 Days 61-90 Days

% o

f C

as

es

Is

su

ed

Percentage of Cases Issued by Days Started implementing lean

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0 500 1,000 1,500 2,000 2,500 3,000 3,500

1/26 (Week 4)

12/29 (Week 52)

11/28 (Week 48)

10/31 (Week 44)

9/26 (Week 37)

7/23 (Week 30)

6/3 (Week 22)

5/7 (Week 19)

4/7 (Week 15)

3/14 (Week 11)

2/21 (Week 8)

1/16 (Week 3)

0-20 Days 21-30 Days 31-40 Days 41+ Days

Employees lives improved dramatically even with a 25% increase in applications

Pending Case Aging Comparison

Eliminated time spent chasing old cases

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Even our customers noticed …

48%

56%60%

54%58%

53%57%

50%

70% 71%

77%

54%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

Speed of Underwriting – Percent of Happy Customers

Pe

rce

nt

of

Ha

pp

y

Cu

sto

me

rs

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When did we start to see sustainable change?

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51

2007 2008 GOAL

Av

era

ge

# o

f D

ay

s –

Re

ce

ipt

to I

ss

ue

WEEK #

WHAT HAPPENED?

a. Implemented new technologyb. Hired more resourcesc. Started using lean toolsd. Introduced lean managemente. None of the above

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PUTTING IT ALL TOGETHER

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Lean journey

Not a walk in the woods but rather a full-scale expedition into the great unknown

REALITYMYTH

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Reflections from my journey

Resist the fervent urge to dive in and provide the answer

Consider… do you want to be the mechanic who quickly demonstrates proficiency with your tool box or the one who actually solves the problem

Turn theory and principles into reality through analogies and stories – make it real!!

Avoid relying on eyewitness reports – always go see for yourself

Present facts – it reduces the debate time

Achieving flawless execution consistently is hard, down in the weeds, dirty work – plus, it is not very sexy

Support from the CEO and executive team never hurts

Acknowledge that internal consultants never get the same level of respect or compensation - even though they must live with the results

Enjoy the journey – just when you think you have reached your destination, you realize how much farther you need to go

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If a solution doesn’t make you a bit uneasy, then ask yourself

if you have pushed hard enough.

And finally

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Lean is deceptively simple but incredibly hard to implement.

Plenty of resources out there …

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We Must Think From The Customer’sPerspective When Determining Value!

And just for fun…

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Thank You!!!!

For more information please contact me at:

ckswank@gmail.com