A lot of companies are implementing a lean daily management system to develop a lean competitive

advantage, but then question if what they are doing is really lean. Some people think applying lean is
like applying six sigma. But, Lean is not like six sigma. So how do you know when you have gotten lean?
In other words, what does lean look like? Here are ten simple ways to tell how lean you really are.

How Lean Is Your Lean Daily Management System?

1. Clean and orderly work areas. Most companies start getting lean by implementing 5S, a
system of sorting, setting in order, shining (cleaning), standardizing, and sustaining. For some, this
sounds like cleaning work areas. A lean system has clean work areas, but clean work cells by
themselves are not lean. A lean work cell contains ONLY what you need. Extra materials are removed
and required materials are clearly marked and have a place.

2. Visual production plans and instructions . When you look inside a company with an
effective lean daily management system you will see work areas labeled with printed signs, the product
ion flow is obvious, with clearly marked hourly production goals. A lean company is well organized with
balanced production flows.

Lean Daily Management

3. Visible equipment status. Andon is a Japanese word, which means lantern or lamp.
Andon lights (red, yellow, green stoplights) are common on production equipment, which are used to
indicate if machines are running (green), are stopped (red) or about to run out of material or need help
(yellow). Some machines come with andon lights, but those lights are of little help if they are not used.
Andon lights are signals that help your lean system flow.

4. Well-defined defect occurrences. Standard work or policies and procedures, should

define what defects are for that process and how to handle them. Defects must be recorded and
corrected if you are to eliminate them from re-occurrence. A lean daily management system has a welldefined method for defect response. They are not ignored.

5. Little Work In Process (WIP) inventory . Just in Time (JIT) means only the materials
needed for the next job or process step are arriving for processing. In other words, no large batches of
standing material, no material handling of next weeks jobs, and no defective materials awaiting rework.
JIT systems utilize lean accounting methods.

6. Streamlined material handling . To eliminate work in process you need streamlined

material handling, which means work cells close enough to each other that one cell can easily hand the
part to the next cell. Work cells are balanced so that they are never waiting long for that next part, and
materials are choke-released into the production stream at predefined takt time based intervals.

7. Clearly marked reorder levels . Kanban is a Japanese word which means signal so a
Kanban based inventory system is based on clearly marked purchasing reorder signals. The reorder
point is based on the materials usage to support the predetermined takt time that your system is
balanced to. If you have not balanced your system to a takt time then you are not very lean yet.

8. Well-maintained equipment. Total Preventive Maintenance (TPM) is a system of

attending to the maintenance needs of your equipment so that your machines do not break down in the
middle of production. If you are maintaining your equipment on a schedule and repairing them before
they breakdown then youre following the steps towards a lean system.

9. Stress free employees. A lean daily management system show great respect for workers. A
workers time is not wasted. Processes are well-defined with clear error-proofing (Poke Yoke)
implemented ahead of time. Workers are encouraged to Stop the system in order to fix defects as they
occur. A workers input is encouraged as a great source of process improvement ideas. A lean daily
management system empowers workers to increase productivity through lean thinking.

10. Noticeable signs of improvement. A lean daily management system is under a

constant state of front-line driven improvements. Employees are always working on correcting defects
from occurring, maintaining their work cells with 5S, performing preventive maintenance, and finding
opportunities for improvement. Companies in Japan get more than 200 times the number of front-line
ideas and more of those ideas are implemented, than the average company in the United Stated.

Process improvements in a lean daily management system are driven by the employees and NOT
management.

What Will Lean do for Your Organization?

Reduce costs
Improve morale
Increase inventory turns
Reduce lead time
Create a learning environment
Increase profits
Develop Leadership
Reduce defective
Increase customer loyalty and satisfaction
Gain market share

Sustain long term improvement

Why does Lean work?

How do you create the thinking environment?
Unlike benchmarking Lean does NOT dictate a result, it obsesses over the process. The process
experts will create standards and recognize abnormalities to problem solve within the system. Lean
systems evaluates all components in the overall system to show relationships and aligns them so that
they are in harmony with one another, thus maximizing The System.
Release the creative talent within your organization by giving them the vision to "See" value and nonvalue added steps in the system.
Lean production was founded in Japan based upon the Toyota Production System (TPS) in the 1950's.
It was created to cut costs and improve efficiency by eliminating waste. "Lean" is not about working
harder. It is about working smarter.
"This challenging spirit is job security. Knowledge, not rank, is what matters"
- Koki Hirashima - Former President and CEO of Honda of N. A.
We are fans of the working mind.

Do We Know What Our Problems Are?

One of the biggest problems in business is the lack of understanding of flow

or how to control it.
Within this flow, time is a reflection of motion which is also a cost.
The majority of this time is non-value added
These are problems
These are wastes
These are improvements
These are cost reductions
What is our natural tendency for problem solving? Highlight or Hide?

Why Standard Operations?

It is the base for continuous improvement and a Lean organization

They develop an efficient production sequence
Foundation for:
Waste reduction
Problem solving
Quality control
Foundation for empowerment
Three Elements of Standardized Work

Standard inventory
Work sequence
TAKT time/operator cycle time
The employees must be trained so they are allowed to develop and improve
their own standards
Without standards, it is all variation, ask any Six Sigma Black Belt.
Simple systyems are the key to empowerment
Standardization is the road to continual improvement.
- W. E. Deming, July 15, 1992

Does your organization have standards?

As a manager or owner, simply telling your employees we have to be more efficient wont motivate
them or improve

employee performance. Saying, like wishing, doesnt make it so. You

have to be a mentor and coach to get the most out of your employees all of them.
You say you dont have time for that? Well, do you have time for inadequate performance? Do you
have time to replace and train a replacement? Time to acclimate them to the company way? Time to
recoup the investment youve already made or the experience? The wisdom?
How do your employees stack up to expectations? Are they performing at a satisfactory level? If not,
could that be due to:

Poor training
Inadequate equipment
Time pressure
Lack of priorities and/or organization
Poor communication
Lack of motivation

Will Better Coaching Increase Employee Performance?

Home in on the reason(s) for decreased employee performance to determine if better coaching will
address them.

What, When, and Why Does the employee know what to do, when to do it, and why? If not,
you need to tell (maybe even show) them.

What Is and What Should Be What is the standard of performance and how does the
employee measure up to it? Does the employee know what the standard is? You have to let them know
clearly whats reasonably expected of them.

Communicate Does the employee know his/her performance isnt meeting the standard? You
need to let them know.

Train Does the employee have the skills needed to do the tasks required of them? If not, you need
to invest time in training to get higher performance in return.

Realistic Expectations That standard of performance: is it reasonable? Whats it based

on? Is your standard current? Stretch goals are fineas long as theyre fact-based.

The Butterfly Effect What impact does substandard performance have on the rest of the
organization? The employee may need to be reminded of his/her place in the firm, their relationship
direct and indirect to everyone else, and how inadequate performance affects other people and
processes. The organization is, after all, only as strong as its weakest links.

Ample Resources Does the employee have enough (time, money, materials, etc.) to get the
job done? You have to see that they do.

Performance Hurdles Is something beyond the employees control affecting his/her

performance? Is there something you, the employer or manager, can do to help?

Positive Feedback Is the employee getting the occasional, well-placed attaboy/attagirl for
a job that exceeded expectations? Or, are they being rewarded by having more responsibilities heaped
upon them? You did this so well, were going to give you more can be as damaging as You stink!

Motivation Is the employees heart in the job? If not, more training, better equipment, and more

resources (like time) arent going to solve the problem of poor performance.

Steps to Improve Employee Performance

Now, lets say youve analyzed the situation and have come to the conclusion that coaching will help
improve employee performance . Heres how you might go about it:
1 . H O L D T H E C O A C H I N G S E S S I O N I N P R I VAT E

Nobody but the two of you need be involved. Be warm and courteous. Remain calm and keep a positive
attitude.
2 . C L E A R LY S TAT E U P F R O N T T H E R E A S O N F O R T H E S E S S I O N

Dont be blunt, though. Say Id like to discuss (XYZ), rather than I need to talk to you about your recent
performance problems. If you want to improve employee performance, you should engage them instead
of talking at them.
3 . S H O W YO U R C O N C E R N F O R T H E P E R F O R M A N C E I S S U E

Example: It looks like were not following up with customers as quickly or as thoroughly as we should.
We used to get back to 80% of our customers within 10 days of their purchase. Now its more like 10%.
Focus on the problem, not the person.
4 . D E S C R I B E T H E WAY S I N W H I C H T H E P E R F O R M A N C E I S S U E A F F E C T S O T H E R S
( I N C L U D I N G YO U )

Example: When we dont follow up with customers in a timely manner, they probably feel like we dont
care about anything but their money. Emphasize we and the team. Putting the focus entirely on them
only deepens the sense of isolation they already feel.
5 . A C K N O W L E D G E T H E E M P LOY E E S S I D E O F T H E I S S U E A N D L I S T E N

Regardless of whether the employee apologizes, rationalizes, promises to do better, etc., hear them out.
They may have a valid explanation (like that theyre overworked you might do more with less but you
cant do more with nothing).

Remember: there are always at least two sides to every story.

6 . G E T T H E E M P L OY E E S I N P U T O N H O W T O I M P R OV E T H E I R P E R F O R M A N C E

Ask, What can be done to improve our follow-through with

customers? There may be some beautiful gems hidden among their thought nuggets help them find
those gems. After all, theyre on the front line every day, so theyll have insights you wont.
7. DIS CUSS POSS IBLE SOLUT IO NS

Work with the employee to develop a number of potential solutions to the performance issue. Make use
of the employees ideas and offer guidance, but dont take over the project. Youre a coach, not a critic.
8 . A G R E E O N A S O LU T I O N A N D AC T I O N S T O TA K E

Identify what you both think is the best solution. Agree on how to arrive at the solution and on
reasonable deadlines. Be clear of your intent that you want status updates so you can help them, not
because you get any joy out of riding them.
Be sure to put the action plan in writing and make sure you both have a copy.
9 . C H E C K O N T H E E M P L OY E E S P R O G R E S S A N D C O N T I N U E T O G E T T H E I R
F E E D BA C K

In order to improve employee performance, give them additional guidance and reinforcement. Dont
hover around them constantly. Just make sure that theyre not stuck on something. If they have ideas on
how to improve the process or the result, listen and evaluate. If they have a good idea, let them run with
it.
1 0 . G I V E P O S I T I V E F E E D BA C K F O R P O S I T I V E R E S U LT S

Every time the employee meets a deadline or hands in a deliverable, give them a sincere Good job!

Dont say, Thats more like it, or You shouldve been doing this all along.
Remember even star employees who are strongly self-motivated (and there are probably more of
them out there than you think) can use a sincere pat on the backor a handshakeor a shout-out. So,
you can imagine how an employee whos been struggling will benefit from quality feedback.
Youve been there. You know how good it feels when someone takes you under their wings. Give back
what you got-it can only help improve employee performance.
Now its time for your feedback. Tell me what you think.