LEAN AU COUER

LMJ crosses the Channel to hear from lean companies in France. Marie-Pia Ignace, President of the Institut Lean France, introduces this special.

France has been at the heart – coeur – of the lean movement right from the start – before the start, in fact. The benchmarking methodology that would give rise to the seminal book The Machine That Changed World that coined the term “lean” was worked out in the Flins automotive plant.

Later on, Professor Dan Jones, one of the key figures in the lean movement and co-author of the book, first saw a full Toyota-like production system in a Valeo plant. Valeo’s VP at the time, Freddy Ballé, had followed Toyota’s progress since the mid-Seventies and, with Toyota coaching, had implemented a home-grown version of the car-maker’s production system.

Throughout the Nineties, lean techniques spread rapidly in the automotive supply industry, often with spectacular results as low-hanging fruits were gathered, leading to a competitive revitalisation of the sector.

Whereas the French OEMs are struggling to keep up with the competition (PSA announced it was closing one of its large plants earlier this year, while Toyota added capacity to its own French plant), several French suppliers such as Valeo and Faurecia have fully benefited from their own versions of the TPS. Faurecia is now one of the largest automotive suppliers in the world and the main source of profitability for Peugeot, its parent company, its growth sustained by its own lean Faurecia Excellence System, originally designed by Freddy Ballé.

Consequently, lean has had a significant impact on French industry, but unfortunately not always in the manner the founders of the movement would have hoped. For instance, an in-depth study of the impact of lean on French industrial companies has shown that, first of all, French firms accept the need to improve radically their quality, but do so through more rigorous final inspection. They also accept the need to reduce their inventory, but seek to improve their planning systems rather than reduce batch sizes. Finally, they see the potential for cost cutting through productivity workshop rather than through work with their front line employees to develop standardised work through kaizen.

Over the first decade of this century, the lean movement in France has spread to all sectors from healthcare to construction and services and has in fact split in three distinct interpretations: one is a bona fide attempt to continue to understand and emulate Toyota’s managerial innovations, centred around the Projet Lean Entreprise at the French university Telecom Paristech. The second, mostly in the automotive world, is an expert-driven effort to improve processes by applying Toyota-like techniques and practices. The third is a consultant-led “cost cutting” approach tagged under the “lean” label, which has very little in common with the two previous trends.

IT has recently entered the lean scope as it shares the same challenges as every industrial activity: rising quality and reducing lead time and cash consumption. Building on its strong agile movement, France is also a hub of lean IT leadership as it has hosted the first worldwide Lean IT Summit in 2011 and is now preparing its second edition this November.


A REMEDY FOR WAITING ROOM PAIN

Should you find yourself in the unfortunate situation of suffering a trauma while showing your skiing prowess in the French Alps, chances are you will come to see us. CHU Grenoble is the largest trauma centre in France, with 8,000 employees and 2,238 beds.

One of the elements that convinced the hospital to adopt lean was the need to better manage the flow of patients in operating rooms. While we were doing a good job at treating the most serious situations, we struggled with “type-2” emergencies (where a patient’s life is not under threat, but treatment must be performed within two to three days).

Our lean journey began a couple of years ago, and really kicked off after I had a chance to go to England to see Ian Taylor and Marc Baker of the Lean Enterprise Academy. Through them I met people from Belgian and American hospitals, and had a chance to benchmark against their experiences.

After this, we decided to work on the length of stay, trying to speed up discharges while pulling the flow of patients. We are only at the beginning.

I soon realised that the key is to work with nurses. Very often people want to start with doctors, but it’s the nurses who are going to see their problems solved first. Once their buy-in is secured and standard work is in place, they will convince the doctors to join the battle.

Additionally, some doctors don’t want to spend time trying to improve something that should already be working. They’d rather spend time with their patients.

In four months, we managed to achieve 5% more activity in our operating rooms, which is important to treat our type-2 emergencies, with the same amount of staff and 30% less space (some of the rooms were being refurbished).

We saw improvement in the laboratory as well. We had to outsource the tests we ordered twice, because we experienced shortages of the reactive agents we needed to perform those tests. By using kanbans and learning how to deal with our stock, we turned things around: we haven’t had shortages in 18 months.

We are also changing the way we welcome people in the emergency room, and we are receiving less and less complaints by patients and the relatives accompanying them.

Finally, although we can’t quantify it yet, we achieved big improvement by introducing standards in the process of preparing operating rooms and in getting patients ready for surgery.

Each type of neurosurgery now has a checklist, which the nurse uses every day to prepare the room and to make sure the surgeons have everything they need at any given time.

I have learned that in hospitals lean is best done step by step.


LEAN WASN’T BUILT IN A DAY

Family-owned PO Construction build apartments in the Paris area. CEO John Bouthillon explains the difficulties of adapting lean tools to the construction industry.

When I was appointed CEO, the company was very much command and control: as long as the results were reached nobody cared whether the way of working was good or bad. That was not the way I wanted to run the business.

I read The Toyota Way, almost by accident, and then turned to other books. I soon decided to give lean a try. It was October 2007.

The regular lean tools do work in construction, but need some adjustments. We need to go to the basis of each tool and reinterprete its purpose to fit the needs of our industry. 5S was the first step, but we had to do it our own way. It’s a basic tool, but it is designed to work in a stable environment. When you build buildings, the environment changes all the time. Every week we need to sort out where to store each part, and every week we do 5S on a checklist.

Here’s another example: on each construction site there is one apartment that is finished long before the others and will be used to check with the client whether any adjustments are needed. The “model apartment” is a traditional tool in construction – we used to put a lot of pressure on each trade (plumbers, electricians, etc) to do the work fast.

We now do it more like in the automotive industry: the engineers are on site, looking carefully at what is done.

Each trade needs to clean the floor after their job is done, to give the next trade a clean environment for work. If a plumber comes in three times, for example, he will clean up three times.

In the model apartment, the first thing we do is placing a door and locking it – no one can work in there without the engineer directing the operations. When workers are done for the day, they check the work with the manager and the two can then lock the door together.

Unfortunately it’s difficult to put standards in place. I go to the gemba all the time, and visit all of the sites in a month. We take videos and use chronometers, but we still struggle with standardised work. Every site is at a different stage of development and progress: my role is to help the ones behind to catch up and those already working well to try new things.

We are increasingly able to understand the difference between doing the job and doing the job well. Engineers don’t always do that. They always get the job done, but often it will need some rework.

We have seen good results, however: our accounting department gives us a profit and loss sheet at the end of each construction. In 2007-2008 there was a lot of variation in expected profits in different sites, but that gap is quickly closing up.

It will take time to make our people fully understand the new way of working so that it becomes part of the culture, but we are up for the challenge.


MAKING IT ALL BETTER

Catherine Chabiron, Lean Office Manager at automotive equipment manufacturer Faurecia, discusses the company’s approach to IT.

As in many global companies, the flow of information at Faurecia is extremely complex. Processes cross different functions, from logistics to accounting, and we needed to address these complexities. We’ve applied lean to manufacturing for almost 20 years, but the progress on the shop floor could only go so far without other parts of the business involved.

With this in mind, we started with lean office principles in 2005. We had to build on the work with stock and delivery times that we were doing on our shop floors, and make sure our IT systems supported flows in Faurecia’s plants.

We started from the premises that what was working for physical product flows would also work for data flows and that what was working for machines would also work for systems. We tested this assumption and we demonstrate every day that it applies.

We always start from the areas where we can secure sponsorship – without it lean does not work. IT, as we see it, has a strong focus on process assistance and change management, and we found it made sense to base our Lean Office team there.

When you have an issue with IT your first port of call is the help desk. From there you move up to a regional expert and then to a competence centre that is even further away, especially in global companies. These support chains didn’t work in continuous flow: people were working in silos. They received incidents and acted on them by batch, losing sight of the overall waiting time for the user. The stop and run ratio was poor with incidents waiting for solutions sometimes 90% of the time. So we introduced global chain measurement, made the incident stocks visible to all support chain actors and saw the stock by user decrease by 50% over the past 2 years.

Capitalising on best known sequences and best practice, we help teams develop work standards to ensure they understand what a normal situation is, and react to any deviation to the standard. We have introduced performance measurement and visual management in IT projects, support and operations (data centre management). We have also done a lot in accounting (where task observation and definition of work standards can bring significant improvements in the invoice posting capacity – 77% more in 2 months in one instance).

The whole process could simply not be reduced to manufacturing. Stock reduction, for instance, cannot rely solely on physical flows on the shop floor in large plants. You also have to address data inaccuracy in the system, as you will need this data to really understand where your stock is. And stock data inaccuracy may come from poor stock movement recording or late engineering updates on parts.

A global one-size-fits-all system is not good: we take volunteers and start implementing change with them. We opened an IT back office in Tunisia and deployed lean there from the very beginning. Germany and France work with that office on a regular basis, they liked what they saw and decided to implement it themselves: this is how the new culture spreads.


IMPROVEMENT WITHOUT BORDERS

Cecile Roche is Lean Director at Thales Group, a global technology specialist supplying the defence & security and the aerospace & transport markets. Here she discusses the challenges of spreading lean across the global operations of the company.

There were three main stages in Thales’ lean journey. Initially, 10 to 15 years ago, we had some successful initiatives in some of our plants. Then, seven years ago, two whole divisions decided to launch lean: one implemented a global approach for all value streams, building on its manufacturing experience, while the other focused on lean production and lean development.

Finally, two years ago, the new management decided to make lean mandatory in production (representing 11,000 people working in 60 plants globally), and voluntary in other business areas.

We face the same difficulties as everybody else as we strive to lean out our organisation. For example, our previous focus on project-based initiatives didn’t help us to effectively make lean part of our daily life.

Another issue is behaviour. Making people (especially our engineers) understand that problems are part of life is hard, and it’s what we are concentrating on this year.

We also need to learn how to prioritise. Our project-based mentality forces us to work on a number of actions at the same time. This makes it difficult to complete them, and to achieve the desired results.

What makes our lean journey particularly interesting is our ability to strike a balance between the global framework for lean we designed and the individual characteristics of each plant. There are some common elements: for example, at a global level we tend not to have large quantities to deliver, with a large portfolio of very different products. Our internal model is focused on projects and techniques. For all other aspects, however, challenges are local.

Every year we set a milestone that everybody has to reach: this year it’s Short Interval Management (SIM), focusing practises around management routine, visual management and problem solving, based on standards that are implemented at team level.

Getting savings isn’t difficult. What’s hard is to sustain them. We are working instead on culture change and behaviours, to improve our operational performance locally. We will really put emphasis on saving when the management practices will be ingrained in day to day operations.

But we have achieved great results: for example, one of our plants has managed to reduce the internal cost of one of its products by 2% every year over the last decade, just by changing production practices.

We found that each area of the business has its problems, and that we need to acknowledge them. Engineering, for example, required a bespoke approach: the difficulty there was to get different activities to work together. The solution was training people to use the Obeya room. Soon enough others wanted one set up for them as well. When a new department approaches me and asks to do lean, the first question I ask is, why? They need to tell me what their problem is, and I will tell them whether lean can help.


LEAN A LA MODE

Hugues Pichon, Quality and Technical Director at luxury brand Louis Vuitton, tells LMJ about the challenges of implementing standards in a craft-production environment, and the company’s constant focus on quality.

Most companies saying they are “going lean” are only after cost cutting. Louis Vuitton is different: it has a long term view and strong internal values driving its continuous improvement programme.

On my very first gemba walk at LV back in 2006 I immediately realised there was a lot of potential to tap into: among the stitching machines in the work shop leaders were interacting with the craftsmen, and I noticed a strong focus on team work. We keep our work shops small, because we want managers to know everyone and be close to their concerns.

When the value of the euro increased (the “Made in” of our products is the eurozone, mainly France) and the situation for the company became more challenging, it was that team work culture that I tried to leverage. However, implementing standard work is always tough, and with artisans it’s even more difficult.

To get them on board and overcome resistance, we videotaped all of them, and then sat down and showed them the videos. Discussion followed, and once a beau geste, a “beautiful gesture”, was identified we made it a standard practise.

On top of common measures like organising flow and reducing inventory and lead time, we have been experimenting with one piece flow. But our aim is to transform the management system to welcome problems and not just the shop floor.

If you want to succeed quickly, you need to change 50 to 80% of your management team, hiring people who know how to analyse KPIs and do a morning brief. I haven’t done so. I have taken my time, and I am proud to say that we were able to implement change with the people we already had. Although the first morning brief really was a nightmare!

Quality, a luxury brand’s strongest asset, is also an important driver for improvement for us globally, and it was very fruitful to start with this approach.

We increased efficiency (reducing muda, rejected parts and time for final tuning, for example), but the biggest benefit of lean was the flexibility to adapt that we developed. Louis Vuitton has a unique model: we only sell through our own stores, which gives us the ability to directly monitor the situation and to control inventory. We can now easily increase capacity for a product, to fulfil the demand from stores.

We produce over 2,000 models at the same time, and flexibility is something we can’t do without. At the same time, we realise we can’t keep our efforts confined to the work shops: you can reduce the lead time for a product, but if the right leather takes five weeks to be delivered you won’t go far. With that in mind, we have developed a support system for our suppliers.

My role has changed over the years: now I only advise, because all decisions come from the work shops. That’s how we’ll continue to manage.