This is a guest post by Richard Lindstrom from eBOM, a Playbook partner based in Sweden. Richard attended the LPPDE conference in Raleigh, North Carolina. Here are some of his observations regarding the multiple case studies presented by Fortune 500 companies that have implemented Lean in the enterprise.
Lean Case Studies LPPDE
I wanted to share my impressions and the quotes I captured at the Lean Product Development conference in Durham, North Carolina as well as share some amazing case studies from Goodyear, GE, IBM and Ford that were presented during the conference.
The conference is called a cryptic acronym LPPDE, that stands for ”Lean Product and Process Development Exchange." Lean was the central topic of discussion at the conference. As it turns out, this word was chosen as an analogy to the human body. A lean body is without excess and healthy.
It was a pleasure to hear Dr James Womak author of The Machine That Changed The World, talk about the background of Lean from his perspective, studying Toyota practices. Dr Womack is the guy that put in the extra “P” as in LPPD, referring to the ‘Process’ part.
According to Dr Womack, A good definition of Lean is:
”Providing more value (judged by the customer) with less resource across the enterprise.”
If you accept this definition according to Dr Womack, a true Lean company is one that delivers "all the value” without any resources. As this is not possible, a company can never be completely Lean (ever), just leaner for each iteration that moves the company in the right direction.
Process is the key to successful Lean Transformation
All of the keynotes and seminars at the conference addressed the issue that process development is the key to success when implementing Lean in any organization. The skill of developing the process itself, was the essence of the conference.
When engineers and their managers focused on the product, they tended to forget to develop the process, or simply put, they lost the emphasis on how they did things.
During one of the lunch discussions I participated in that was led by Dr. Sobek, we discussed why it is hard to succeed in implementing lean in product development in companies.
We discussed several issues including:
- Changing culture takes up to three months time, but companies believe that a 3 day workshop will fix everything
- Process development is not considered valuable, even though we know that it has huge potential to impact profitability as well as many positive soft factors
- Companies that must change in order to survive, often have great success! Sense of urgency seams to be important…
- Change involves learning and includes failures along the way
There is a lack of good examples and easy straight forward fixes
Lean Case Studies
The last letter “E” in the acronym of LPPDE stands for Exchange. The soul purpose for visiting a conference like this, is that all participants share experiences with each other. I heard many really interesting and useful stories about Lean experiments and journeys across a wide variety of companies and industries. For example, I discussed Lean process development with people in biochemistry, heavy lifters, electronics and chip development, appliances, consumer products, lean implementation professionals, hospital designers and builders. Here are some specific case studies.
Goodyear’s Lean Journey
Joe Zekoski, Interim Chief Technical Officer and VP of Global Product Development at Goodyear started with a presentation of how they struggled with poor predictability and lead-time for their 1500 new tires each year. They worked systematically since 2006 from the ”death spiral” through to stability, speed and now they are working on sustainable leadership. A very positive presentation with amazing results in a large organization.
IBM’s Lean Journey
Jeff Maling, Technology Development and Installation Engineer at IBM showed how a smartphone radio chip development was accelerated by small learning cycles and obsession with speed. The result generated a 30% increase in performance instead of an expected 10% increase. Impressive work with improved development processes led to tangible results in just a few months.
The core development team at IBM team had only 20 people. The key driver for this facility is the fact that if they do not excel, smartphone companies will buy another chip. In short, they will lose their work and be out of business. A sense of urgency is important to motivate a change in behavior and to find the motivation to overcome temporary setbacks.
Kevin Nolan, VP of Technology at GE appliances started their journey in 2009 when the recession hit the market. They realized that they needed to do something in order to stay competitive. Their first phase was to fix poor facilities for prototyping, modify a cumbersome development process to make teams work more cross-functional and to bring R&D back to USA.
A lot of R&D had been outsourced and GE lost skilled experts they now needed. After a hefty investment of 1 billion dollars, they managed to employ 3000 new co-workers!
The next step was to get the basic PLM tools in place, train people and further develop and experiment with the development process itself, in order to tweak it and improve performance. They started to involve suppliers and the factory to reduce waste along the way. They also reported a positive result with a massive LPPD investment.
Ford chief engineer Dave Pericak, Mustang Chief Engineer gave a very energetic presentation on how it was to live the life of a chief engineer for Ford’s most prestigious product, the 2015 Mustang. Lean has really transformed the Ford company and made it possible for the role of chief engineer to take the customer perspective and control decisions throughout the project. This would not have been possible only 10 years ago. Really strong leadership with focus on customer needs, made the difference for the impressive result.
In conclusion, I strongly recommend you to invest time in developing a Lean development process.
You don't need a billion dollars or to be a huge company to get results, but you will need the ambition of being better and in the long run leaner.
It is highly lucrative, although it is not easy, you need to learn new stuff and try things that will result in a few mistakes on your journey.
If you need someone to discuss how to get started, please feel free to contact me.