A zillion years ago (OK, let’s say 1985) when I was working in the automotive supply chain in materials management we were jumping through hoops implementing “quality circle” teams along with other unfunded mandates from our customers like JIT (just-in-time) inventory deliveries. The Deming quality circles sounded great . . . but frankly, I know of no one in the entire auto industry that successfully deployed them for longer than a year or so. They quickly withered away into irrelevance and became another “program of the month,” as so many have since. Nearly every large company I have visited in the last 10 years has admitted the same phenomena. Does this mean circle teams don’t work, or are a bad idea?
If we fast-forward to more recent times, I am seeing a strong rebirth of creating circle teams – but more closely tied to the way Toyota does it in their Kaizen Circles. One of my favorite authors on how Toyota does things is Pascal Dennis, an ex-Toyota of Canada employee who wrote a westernized book on how they do things. At Toyota, Kaizen primarily takes the form of “Kaizen Circles” or “Practical Kaizen.” Kaizen Circles are self-directed “natural” workgroups that are supported by a facilitator, advisor/sponsors, circle trainers, and management. These groups focus on continuous, small improvements, whereas “Practical Kaizens” are used by Toyota as an intense week-long activity to train team members and supervisors while improving a specific process. Source: Lean Production Simplified by Pascal Dennis (©2002).
A lot has been written about Kaizen in this department, and elsewhere – but very little has been written that delves deeply into how we go about establishing and nurturing “circle” teams that are made up of natural work groups of people who are responsible for pieces of our value streams. Every company that is serious about Lean should be utilizing circle teams, but frankly, very few do in a meaningful way. The reasons why are many, but the main reason that what we do to nurture and sustain circle teams is because a considerably different mentality and approach are required.
Properly chartered, developed and supported circle teams do work – no matter what label you put on them. One of the world’s premier medical services and research institutions has had remarkable success in the last year in their clinical labs group with Kaizen circle efforts – enjoying a 20% increase in workforce productivity in the areas where circles are active. This has led to lower hiring requirements in the face of strong growth and has led to generating a lot of interest in applying Lean Six Sigma in other parts of the business. Ironically, their approach was upside-down from what the Lean gurus usually suggest – starting with Kaizen projects and then migrating to circle teams. Sadly, this is the exception and not the rule. Why? It takes a lot of hard work and a different attitude than what is successful in traditional “project” or “event” based deployment.
Most Lean practitioners seem to understand what it takes to charter and support the “blitz” Kaizen teams that we are so familiar with. The nature of quick-hit improvements makes it very appealing to western managers for many reasons. When the logical next step of chartering and supporting on-going work-group based incremental continuous improvement comes, most businesses outright fail to execute because it is too hard to make the shift from a short-term to a long-term focus. When we move toward circle teams we are forced to deal with some tougher issues that we don’t have to deal with in project Kaizens. We don’t get to pick who is involved nor do we get to pick “A” players to load up the team. We must work with the people we have – irrespective of their motivation or skills. Where before we could transcend politics, now we must figure out how to operate within the limitations of departmental and cross-departmental politics. Where before the objectives were clearly mission-critical and the level of support would overcome any nay-sayers, now it is necessary to fully understand the nay-sayer viewpoints and work to win them over through a team effort.
With Kaizen teams, we put our very best facilitators or consultants on the team to drive the process – taking no prisoners in the process. With the circle team, we must now figure out how to follow the same evaluation and application of Lean tools approaches – without high-powered facilitators. The nature of the goals that Kaizens typically tackle get ‘sky-is-the-limit’ commitment to make things happen, whereas the modest, incremental goals of circle teams are not nearly as sexy and exciting.
Where Kaizen teams are infused with the best leadership skills we have, circle teams must “make do” with the managers and supervisors who work in these areas. If the business is not actively developing their supervisors and managers continuously, this can spell real trouble. Why? Most people get promoted to management because they are good technicians, good at getting the work done in their department. Most have some driver qualities and have some “management” skills. These are great in and of themselves, but when we want to get everyone to think critically about processes and then take ownership and responsibility for improving them, new skills are required that we cannot expect traditional managers and supervisors to understand – let along excel in applying.
In this first part of a series of articles examining these issues, I will delve deeply into a real case-study company who is well on their way to adopting circle teams. Their expectation is that every single employee of the company below executive ranks is a standing member of a circle team that is actively working toward objectives that support the goals of the organization in a meaningful way.
This business has gone the route of starting with Kaizen project teams to go after some very critical areas of the business that could not wait – and then chartering natural work groups to take over the projects and continue on. They have used these initial events as a training ground to develop a core team of internal process consultants and to generate some impressive wins over the last year. The COO reported to me recently that their payroll costs are down $1.4 million year over year while at the same time they have increased sales by 5%. Even better, they are seeing a commensurate increase in customer satisfaction and measured quality of internal processes. Processing lead time for the average “order” has fallen nearly 50% in the last year. The most telling statistic year over year is a 15% net reduction in toll-free calls for customer problems. This is clear proof that “things are being done right the first time” more consistently and faster.
At the same time, every kaizen team has generated many ideas that they did not have time to pursue, or could not pursue because they did not fit the charter of what the team was to work on improving. Enter the circle teams to take them to the next level of performance.
Now, for a little fess’in-up . . . the first circle teams chartered at this company struggled big time. Why? Earlier in this article, I outlined some of the issues faced by the company. One of the big issues that are being addressed concurrently, is supplementary training for managers and supervisors on the skills they need to master in order to properly support and lead their circle teams. This supplementary training has focused on team building and empowerment, conflict management, individual and team styles assessment, and high performing work team training.
Even with these specific measures, we took the time to bring in the managers and supervisors and ask them what else they needed to know in order to be effective in supporting circle teams in the future in a fully effective way. This led to some Q & A documentation that has been published to help align everyone in this company. In the limited space of this month’s Lean Culture, here are some of the initial questions and answers.
In our initial brainstorming with supervisors and managers we identified the following categories of questions:
Question – Does a Kaizen event HAVE to take place prior to starting a circle team?
Answer – No. However, there are many cases where starting with a Kaizen team effort first is a good idea – especially if there are many interfaces outside the department or area that cannot be excluded in looking at what happens in this department or area. This is one of the reasons the steering committee elected to start with the various Kaizens chartered thus far and going forward – getting things underway to kick-start circle team activities.
Question – Can you clarify how the circle teams go about getting organized and establishing a charter initially?
Answer – The first and easiest source of a charter is taking over where a previous Kaizen has left-off. If there is no previous charter or it needs to be revisited, we suggest making this the #1 activity of the team, to brainstorm and agree on a charter. Ask the department managers to provide an initial charter that ties in with the current steering committee and company-wide improvement objectives.
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