Lean Transformations and Real-Time Performance Analytics

Tom DeForge discusses Lean Transformations and Real-time Performance Analytics. I first became acquainted with Tom because of the work he did in the Lean Turnaround that took place at PAS Technologies. Bob Weiner, CEO of PAS spoke very highly of Lean Value Solutions International and the role that LVSI played in the successful implementation of Lean at his organization. Tom also discussed a new software package designed for “Driving Lean Behavior through real time analytics.

Lean Value Solutions International (LVSI) is the destination for organizations seeking results-based partnerships that require rapid results - whether the assignments are strategic or tactical in nature. Regardless of the size of your organization, the fundamental obstacles to implementing a Lean strategy are fundamentally the same. LVSI provides the expertise and infrastructure necessary to help you implement strategy and align culture, processes and execution to achieve a series of quick results along a roadmap that is focused on achieving sustainable competitive advantage.

 

Lean Value Solutions -

Related Blog Posts:

Lean Value Solutions Podcast

Lean Transformation Discussion

PAS Technologies CEO, Bob Weiner discusses a Lean Transformation

It takes guts, to start with lean training in a turnaround!

Technorati Tags: Lean,Six Sigma,Lean-Transofrmation,Software,Performance

Value Stream Mapping

 

Value stream mapping is a tool that helps you to see and understand the flow of material and information as a product or service makes its way through the value stream. Value stream mapping is typically used in Lean, it differs from the process mapping of Six Sigma.

A value stream map will take into account not only the activity of the product, but the management and information systems that support the basic process. You will gain insight into the decision making flow in addition to the process flow. The basic idea is to first map your process, then above it map the information flow that enables the process to occur.

Why use Software for Value Stream Mapping? I think the use of software that is written specifically for Value Stream Mapping is important. It forces you to make a decision to drill down into the subject as you are doing it versus later in the process. This particular tool is interesting because of the ability to Excel’s powerful scenarios to analyze multiple sets of numbers without needing to redraw an almost identical map over and over again. Take a look at some of the other features.

1. Visually see your entire process flow using the language of Lean to learn to see and eliminate wastes

2. Answer the question How can we make only what we need when we need it?

3. Form a blueprint for Lean implementation to rally your team to eliminate wastes

4. Instant on-line training for Lean concepts and techniques

5. Easily customized written in Excel with all of its familiar formulas and charts

6. Professional deliverables easily stored, emailed, and shared

7. Drill down to swim lane flowcharts and other related documents

8. Import Old comparison data with the click of a button

9. Inexpensive to easily share & collaborate

Did you know you could draw your Value Stream Map in Excel

Value Stream Mapping

Technorati Tags: 6 Sigma,Excel,Lean,Mapping,Six Sigma,Software,Value Stream

Elevating and Repairing Marketing Constraints

A continuation of my blog posts of Using the Theory of Constraints with your

Marketing HourGlass. We are concentrating optimizing the Throughput of the Marketing Hourglass utilizing the Five Steps of Continuous Improvement, Steps 4 and 5.

Step 4.  Elevate the system’s constraint.

You may have found significant improvement in the preceding steps and another constraint may have actually developed at this time. This is the step that we have to add capacity to the constraint. It may be additional events, sales people or increased advertising.

Reviewing the Marketing Hourglass you may have found significant shortcomings in one of the phases. You may have never instituted a formal referral program, for example. You may not have a presence in Social Media.

Jumping into this step early in the process is very common. The newest and/or the latest technology may seem an easy fix. Looking to vendors for your fix is an easy alternative, but you may not find the core problems associated with the constraint if you did. There is a reason this is the fourth step, and you should make every effort to improve the constraint through the fist three steps before adding equipment, software, increased advertising, etc.

This may also be the area that “Tribal Knowledge” may limit your thinking. We defend what we have always done. Look at new and different ways to accomplish the constraint.

Step 5. If a constraint is broken, go back to Step 1. However, don’t allow inertia to become a constraint.

You will always have a constraint. A fundamental concept of continuous improvement. As you correct one another will develop. As in Lean this is a fundamental concept of TOC.

Mot organizations have an unlimited number of things to improve. However, most of the time only a relative few will make a significant difference in your company’s bottom line. If you are going to improve something , IMPROVE IT.

Why waste everyone's time? Changing the process without the data is cause for failure. You have heard it time and time again, JUST DO IT! We have been trained that way, action is accomplishment. However, the wrong action may accomplish little or drive you deeper into a hole. Without the data from the previous steps, you will not be able to make as effective and dramatic improvements that you desire. Seek 200% process improvements and cost reductions of half!

One of the sayings I have read about in TOC time and time again. Don’t leave inertia become the constraint. Change should help your performance, not hinder it.

Related Posts:

Using the Theory of Constraints in Marketing

The Marketing Hourglass

Using your Marketing HourGlass to determine your Constraint

Identifying your Marketing Constraint

Exploiting and Subordinating your Marketing Constraint

Technorati Tags: Duct-Tape-Marketing,Lean,Marketing,TOC,Theory-of-Constraints

Public Relations Marketing

I have access to so many good articles as a result of my affiliate status and seldom use them as often as I should. So who better to start the series out with than with Palo Alto Software and Tim Berry.

Excerpt from On Target: The Book on Marketing Plans by Tim Berry and Doug Wilson

Public Relations involves a variety of programs designed to maintain or enhance a company's image and the products and services it offers. Successful implementation of an effective public relations strategy can be a critical component to a marketing plan.

A public relations (PR) strategy may play a key role in an organization's promotional strategy. A planned approach to leveraging public relations opportunities can be just as important as advertising and sales promotions. Public relations is one of the most effective methods to communicate and relate to the market. It is powerful and, once things are in motion, it is the most cost effective of all promotional activities. In some cases, it is free.

The success of well executed PR plans can be seen through several organizations that have made it a central focus of their promotional strategy. Paul Newman's Salad Dressing, The Body Shop, and Ben & Jerry's Ice Cream have positioned their organizations through effective PR strategies. Intel, Sprint and Microsoft have leveraged public relations to introduce and promote new products and services.

 

Similar to the foundational goals of marketing, effective public relations seeks to communicate information to:

• Launch new products and services.
• Reposition a product or service.
• Create or increase interest in a product, service, or brand.
• Influence specific target groups.
• Defend products or services that have suffered from negative press or perception.
• Enhance the firm's overall image.
• The result of an effective public relations strategy is to generate additional revenue through greater awareness and information for the products and services an organization offers.

Goals and Objectives

Good strategy begins with identifying your goals and stating your objectives. What are the goals and objectives behind your public relations strategy and can they be measured and quantified?

Each of these areas may reflect the goals your public relations campaign may seek to accomplish.

Press relations
Communicating news and information of interest about organizations in the most positive light.

Product and service promotion
Sponsoring various efforts to publicize specific products or services.

Firm communications
Promoting a better and more attractive understanding of the organization with internal and external communications.

Lobbying
Communicating with key individuals to positively influence legislation and regulation.

Internal feedback
Advising decision makers within the organization regarding the public's perception and advising actions to be taken to change negative opinions.

Source: Articles on bplans.com

Technorati Tags: Palo-Alto-Software,Tim Berry,PR,Public-Relations,Marketing

Start with Customer’s Need in your Value Stream Mapping

In the book, Learning to See by Mike Rother and John Shook, they recommend a mapping tip of beginning the Value Stream Mapping process by walking downstream from the customer end. This way, they say you will begin with the processes that are linked most directly to the customer. As I was reading, actually re-reading the book, I thought how simple and intelligent that statement was. Starting at the end of the process should be the logical thing to do if you are considering developing a pull system. It is the beginning. This is very similar to my thoughts I expressed in my Mirror Marketing E-book.

Mirror Marketing E-Book

In a marketing perspective, how often do we really consider what our customer is real needs are. I find it interesting in a recent study by Rain Today they cited that the number one reason that most professional service sales are lost is CLARITY! I think it might also be said for many product opportunities. It might not be directly, but if your product or offer was fully understood before the purchase decision was made, would that improve your closing rate?

So do things become clearer walking backwards? Try this old golf trick, walk your favorite golf course backwards. Does the out of bounds, elevations and other danger seem entirely different? Why not put yourself in your customer shoes? In Six Sigma perspective, we call this process Voice of Customer, but do we really consider the metrics of delivery performance, number of defects, invoice accuracy and other views that the customer is experiencing.

If you have a customer that will take the time with you, try having him draw a process map of your product. Or just blue sky the different experiences that he has with your organization. How accurate are they? After that, have them draw a future state. What would they like to see from your organization? Are you willing to deliver that experience?

What is Value Stream Mapping?
Value stream mapping is a tool that helps you to see and understand the flow of material and information as a product or service makes its way through the value stream. Value stream mapping is typically used in Lean, it differs from the process mapping of Six Sigma.

A value stream map will take into account not only the activity of the product, but the management and information systems that support the basic process. You will gain insight into the decision making flow in addition to the process flow. The basic idea is to first map your process, then above it map the information flow that enables the process to occur.

Related Information: Did you know you could draw your Value Stream Map in Excel

Technorati Tags: Kaizen,Six-Sigma,Value-Stream-Mapping. Lean

Making Segmentation work in your Marketing Hourglass

How do you look at your marketing?

Do you know where your leads come from?

How are you processing leads to make them successful?

In my recent blogs about marketing and the Theory of Constraints, I discussed the connections between each step of the marketing hourglass. Many organizations do not look at their sales and marketing process in a linear fashion, let alone segmenting it. When organizations first map out the process, they look at connections where people come from being all over the map such as the diagram to the right. They look at a simple chain as an oversimplification of reality. Not everybody goes through each step of the cycle. Some will skip from step one to step three. Someone may enter the cycle in step three. These interconnections are not trivial, it is what makes your process work and it also may be stopping it from working. So what is the purpose? The purpose of creating the marketing hourglass is very simple: Which is harder to manage the above diagram or this diagram?

Your flow system, The Marketing Hourglass, structure will allow an organization to operate at maximum efficiency. And the secret in creating such a linear flow fashion is segmentation. Without it, you will continue to operate in less than an optimum manner. You will never be able to find your constraint, because it will be moving around, practically every single opportunity.

Different opportunities, normal variation and changing workforce make it just about impossible to balance everything. There is a weakest link; there is one element in your system more limiting than another. Why is it so important to find that? Without working on your greatest constraint much of your work will be wasted and non-productive. Take a look at the diagram above and see how proper segmentation may alter your perception of the marketing hourglass. As you can see, not all steps may be needed for each and every channel. An excellent example is someone that has been referred to you. With the proper referral program in place, you will know exactly what step in the process that person should enter.

Keep segmenting your list, till you gain a linear flow. Yes, there may be a few exceptions. However, I think it might be interesting to scrutinize those exceptions. Are these exceptions really your target market or ideal client? I think you might find out that they are something less than ideal clients. Whatever you do, don't ignore the exceptions; they may prove valuable insights to your marketing process. That thought may lead to another discussion.

Related Posts:

Using the Theory of Constraints in Marketing

The Marketing Hourglass

Using your Marketing HourGlass to determine your Constraint

Identifying your Marketing Constraint

Exploiting and Subordinating your Marketing Constraint

Elavating and Repairing Marketing Constraints

Technorati Tags: Marketing HourGlass,TOC,Theory of Constraints,Goal,Sales-Channels,Duct Tape Marketing

Exploiting and Subordinating your Marketing Constraint

Step 2.  Exploit the system’s constraint

This simply means; Getting the most out of the weakest link or phase. This is a great time to use the Lean tool of Kaizen. Getting rid of all waste associated with the systems constraint is the first step I would take. One of the things that TOC and Lean both encourage is to observe the process with people very familiar with it. They may tell you that this always happens or maybe an obvious statements such as we don’t have enough people. Looking at the waste you will readily identify some crucial changes.

Put a cost to the constraint. If this is your weakest link, improvement in this area will maximize the entire process. Understanding the cost of the constraint is imperative in moving forward. Once you have a cost assigned to the constraint, you start looking at improvement slightly differently. Observe how things move through a constraint. Hiring that one extra person, holding additional events, dedicating a phone line or a live operator could make significant differences. Using an tip from Rapid Product Development, you may want to parallel this process. This allows simultaneous actions versus many of the different types of time constraints detailed in or list of definitions.

Technorati Tags: Duct-Tape-Marketing,Lean,Marketing,TOC,Theory-of-Constraints

Step 3.  Subordinate everything else to the above decision.

Increase output through the constraint(phase) increase output for the entire system. I sometime use the analogy when a salesman senses an order. He puts everything else on hold and dedicates all his resources to getting that order. It is also very similar to the Lean method of Kanban. Kanban is a method of only releasing parts as needed through the process. A card must be given to the preceding event before that phase can start.

Interesting thought may be as you manage marketing campaigns or events that you only release calls, direct mail based on responses from your prospects. A proactive drip management program may solicit certain key actions before additional material is released automatically.

In manufacturing, I have seen a quality station placed in front of the constraint before allowing parts to move through the process. In marketing, you may add a qualifying step so the constraint or process only receives a more qualified prospect.

Integration of the Theory of Constraints and Lean Six Sigma

Integration of the Theory of Constraints and Lean Six Sigma

Bob Sproull was my guest on the Business901 podcast. Bob is an experienced manufacturing executive with a distinguished track record of achieving improvement goals in Manufacturing, MRO, Quality, Product Development, and Engineering. His experience base ranges from low-volume custom products (truck bodies) to process industries (tires) to service industries (Maintenance, Repair and Overhaul). He is a nationally known speaker and author on problem-solving and statistical techniques, as well as his latest book on implementing an integrated Lean, Six Sigma and the Theory of Constraints.

Our discussion centered around The Ultimate Improvement Cycle: Maximizing Profits through the Integration of Lean, Six Sigma, and the Theory of Constraints show you how to draw the best from Lean and Six Sigma by employing principles drawn from the Theory of Constraints. This approach will ensure that your effort is focused in the right place, at the right time, using the right tools, and the right amount of resources. This multi-pronged approach addresses cost accounting, variation, waste, and performance measurements. But most importantly, it focuses your organization on the right areas to optimize.

You can listen to the podcast by clicking on the Podcast link on the right or download the podcast from the Business901 ITunes store. The site offers visitors the opportunity to listen to current business and nonprofit topics such as discussions on Social Media, Lean Six Sigma and Marketing.

About Sproull Consulting
Unlike most other consulting companies, we don’t believe that simultaneously attacking every facet of your operation and attempting to implement across-the-board improvements offers the most expeditious or optimum return on your investment $'s. Instead, we believe that there are only a few key leverage points in your business that limit your ability to increase throughput, revenue and profits. We identify these leverage points and make them the focus of the improvement efforts. We understand that you have limited resources and you don't want them wasted on improvement efforts that yield only minimal bottom line improvement. By identifying and leveraging the right area of focus, the improvement results that you realize are significantly better and hit the bottom line at a much faster rate than any other approach on the market today.

About Business901
http://Business901.com provides direction in areas such as Lean Six Sigma marketing and organized referral marketing. Business901 has designed their services and product offerings so that they are implementable systems that work in the real, not enough time, not enough people world we operate in. We provide tools that simplify the marketing process, not complicate it. Joe Dager, President of Business901 is a Lean Six Sigma Black Belt and a Duct Tape Marketing authorized coach.

P.S. During the podcast we discussed the value of Value Stream Mapping.

Listen to the Podcast here.

Technorati Tags: TOC,Theory of Constraints,Lean,Six Sigma,Performance-Improvement,Continuous-Improvement,value-stream-mapping

If you are Act Customer, you should be considering Swiftpage!

Disclaimer: I do represent Swiftpage and act as an affiliate resource for them.

As an ACT! by Sage customer, you already understand the importance of knowing as much as you can about your customers. To take this knowledge to another level, join the thousands of people who use Swiftpage to perform comprehensive management of email campaigns, and enhance their marketing and sales efforts.

Create graphical email templates with Swiftpage using its simple online editor, or import your own HTML.

Then send these emails directly to your ACT! Contacts, Look Ups, Groups and Companies - from yourself or on behalf of your sales team members.

Easily track who opened, clicked, bounced and more.

Swiftpage also provides intelligence about your customers. A customer who has opened previous emails from you five times and has clicked on three links, is likely more interested than someone who opened an email once and didn't click any link.

Snapshot by Swiftpage places important information about your customer, both from data in ACT! by Sage and from internet sources like LinkedIn into a display that's intuitive to read and use.

It's a long established marketing practice to continue to contact prospects at the appropriate time.

Swiftpage Drip Marketing blends simple functionality, like the ability to automatically send a sequence of marketing messages to a contact that fills out a form on your website, with intelligent technology that will send different messages to contacts based on their previous actions. For example, send a postcard to those that did not open the previous email - automatically!

From events or corporate announcements to a new customer welcome or product launch - Swiftpage provides the ability to automatically deliver marketing content and drive your ACT! by Sage sales processes.

Swiftpage and ACT! by Sage - bringing innovative technology to critical tasks, so that you can bring your talent, to everything else.

P.S. It’s worth a tour!

Technorati Tags: Swiftpage,Act,Sage,Drip-Marketing-Program,Autoresponder

As I mention in a previous post: Every System, typically has relatively few constraints. However, to operate at maximum efficiency, the limiting constraint must be identified. Five Steps of Continuous Improvement help identify and improve the constraint. How do I correlate the Marketing Hourglass with the Theory of Constraints? TOC uses the weakest link, a chain as a visual in working with throughput.

Below, I have outlined my basic understanding of the Theory of Constraints from my readings and experience. If you would like to dive deeper into this subject start with the AGI-Goldratt Institute website and there is whole slew of books, trained consultants(Jonas) available throughout the country. I believe the Theory of Constraints principles are a requisite for continuous improvement.

Before starting with the 5-steps, there are two prerequisites:

1.Identify the Goal of the System /Organization

2.Establish a way to measure the progress

The most common goal is to make money and that should be our overall purpose. It sometimes can be overlooked in increasing sales, client retention and many other factors. Many will argue but increase sales can hide many problems. The companies that fail the quickest in a recession are the ones that were living on growth without really generating income.

There are several ways to measure progress with the most common being Throughput, Operating Expenses and ROI. Going into too much detail about how to use the ratios is beyond the scope of this blog. The important thing to remember is that TOC methodology values Throughput and it as the best means to fuel growth. TOC then looks at Inventory(Prospects) second and operating expenses third. So our concentration will be optimizing the Throughput of the Marketing Hourglass utilizing the Five Steps of Continuous Improvement :

Step 1. Identify the system's constraint.

Step 2. Exploit the system's constraint.

Step 3. Subordinate everything else to the above decision.

Step 4. Elevate the system's constraint.

Step 5. If a constraint is broken (that is, relieved or improved), go back to Step 1. However, don't allow inertia to become a constraint.

Starting at the beginning:

Step 1. Identify the system's constraint.

The system's constraint is the phase or part of the phase that resource which limits the output of the entire system. Start following your actions and you may find out that your bottleneck is not just getting more prospects in the door. If you can monitor actual numbers, you may be amazed at what is happening to your prospects(inventory). This is where we need to identify the constraint , where is your constraint?

The easiest way in a manufacturing analysis is to walk around and see where the work is piled up. It is not that much different in a marketing process. Walk around and see if there is a pile of sale presentations waiting to go out. You may find people waiting on financing to be approved. Maybe, inconsistent delivery of Newsletters and so forth.

If you have done a good job of building your marketing hourglass, you may be surprised on how easy it is to find. You may be so lucky to be able to eliminate parts of a step, not the entire step. Start internally, as you gain internal control you will also gain the respect of your customers and vendors. This may help you significantly when you ask them to assist you in late improvement needs.

Our Next blog will continue with step 2 and 3.

Related Posts:

Related Blog Posts:

Using the Theory of Constraints in Marketing

The Marketing Hourglass

Using your Marketing HourGlass to determine your Constraint

Technorati Tags: Duct-Tape-Marketing,Hourglass,Lean,Marketing,TOC,Theory-of-Constraints

Another way of using the hourglass is to determine the number of prospects(inventory) that you need in each part of your hourglass. This is tremendous opportunity to really understand what is taking place in your process and will enable you to determine what is and what is not working. Where is your bottleneck or if you have ever read The Goal, where is your Herbie?

In your process do you understand your conversion rates? Are you converting 50% of your prospects from the Try phase to the Buy phase? You may not know each of these, but if you know several of them, you will have the ability to interpolate some of the others. The ability to create this chart will allow you to significantly increase your sales result. Have you ever considered where your constraints were in your marketing? Many people spend the majority of the time, money and even skill in developing new leads. They may be just piling prospects(inventory) in front of a constraint. Going through this exercise may significantly increase your awareness on what is your limiting factor.

An obvious example, is we alll know that a referral is our best form of creating business. Duct Tape Marketing emphasizes referrals and in fact, John Jantsch, author of DTM, next book is based on building a Referral Marketing System. I mention this, because, I believe your marketing is incomplete without a formal Referral Marketing system in place and by the way, I offer such a package. Seldom do I see the true cost of what it means to gain a referral. I think the chart below, demonstrates quite vividly what it means in the overall marketing flow. If you get a repeat buyer or a referral, you would drop them into one of the phases above. Notice, how it significantly it could change your marketing efforts. Consider the dollars and time you spend in the top of the hourglass. How productive would your efforts be in using the same amount of time and effort in the bottom of the hourglass?

Technorati Tags: Duct-Tape-Marketing,Hourglass,Lean,Marketing,TOC,Theory-of-Constraints

We realize that referral efforts are probably short changed in most marketing practices. But that may or may not be your limiting factor. Every System typically has relatively few constraints. However, to operate at maximum efficiency, the limiting constraint must be identified. The Five Steps of Continuous Improvement from the Theory of Constraints methodology help identify and improve the constraint. That is the next stage and next blog.

Related Blog Posts:

Using the Theory of Constraints in Marketing

The Marketing Hourglass

This is a simplified version of how a hourglass would look. As you can see the natural progression of the flow (know, like, trust… flow to the right), the enablers or information to move the process forward is provided above each step. Taking a group of current customers, you can identify this in your current process. If this seems difficult, make a certain group that you can segment and document the process. Many companies will find huge gaps in their processes which are supported by other departments such as sales or service or maybe by repetitive marketing.

A quick primer for anyone that has not followed my blog or listen to me talk about marketing for over five minutes is that I adhere to the Duct Tape Marketing definition of marketing: Getting someone, who has a need, to know, like and trust you. Now, when you have a marketing system in place this expands to – getting someone, who has a need, to know, like, trust, try, buy and refer you.

One purpose of the hourglass is to provide clarity to an individual or organizations marketing process. This gives you the ability to walk a prospect through the process, understanding where they are at in the process. Typically, I have a customer add the activities that he uses in each stage of the hourglass. Don’t look at this as just a simple exercise for a small organization. I use this in larger organizations by just repeating this process for each sales channel the may have. The secret to this is that you really forces you to layout your marketing process and is really the beginning of development of your marketing process.

When you create your hourglass the purpose is to achieve better cooperation of the multiple phases. Each interlinking phase depends upon the other links. In each of them you will have different capabilities, normal variation and a changing workload making it practically impossible to balance. Using the TOC(Theory of Constraints) we will find one phase of the hourglass more limited than another. Since we have determined that the whole hourglass is dependent upon the cooperation of all phase, the weakest link determines the strength of the chain.

Every System, typically has relatively few constraints. However to operate at maximum efficiency, the limiting constraint must be identified. Five Steps of Continuous Improvement help identify and improve the constraint.

Technorati Tags: lean,TOC,Theory of Constriants,marketing

Hoshin Kanri or Policy Deployment

I had Robert Stapp of OP•EX Direct Results Inc. on the Business901 podcast and we had a great discussion on performance improvement in general. We also discussed in detail, Hoshin Kanri aka Policy Development. This podcast is on this particular subject but before you start listening I have included a little background on the term.

The purpose of Hoshin Kanri is to make it possible to move away from the status quo and make a major performance improvement. Policy Deployment deploys top management policies and targets down through the organizational tree. At each level, the policy is not only implemented but translated into policies, targets and actions for the next level down. This way top management vision can be set into a coherent, consistent, understandable and attainable policies and actions that can be applied at all levels of the company and in all functions of the company.

Policy Deployment aka Hoshin Kanri

News Release

Related Posts:

Hoshin Kanri aka Policy Deployment

How much Planning is enough – Use Lean and Standardize

Ready for Operational Excellence, How to get started!

Technorati Tags: lean,operational excellence,policy-Deployment