Mike Orzen, CMA, CFPIM, PMP
www.maorzen.com
May 16, 2012
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
Purpose
—  Introduce you to the ideas Lean thinking and strategic
alignment
—  Explore the role of HR
—  Provide an example
—  Share some ideas and insights
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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Mike Orzen, CMA, CFPIM, PMP
§  Accountant/Financial Analyst/MIS (PriceWaterhouse)
§  IT project manager, systems analyst, QA, developer
§  Business Reengineering (Lean, Six Sigma, TOC)
§  Production Panning, Supply Chain & Plant Manager
Shingo Prize 2011
§  Lean Coach & Consultant - Lean Enterprise Institute, The Shingo Prize
§  IT, HR, Finance, Production Planning, Supply Chain, Admin, Mfg.
§  Strategic Planning and Deployment
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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What Challenges Are You Facing?
—  Keeping up with complexity and growth
—  Coordination and communication
—  Addressing constraints – time, $, people, regulations
—  Sustaining improvements
—  Moving away from reactive firefighting to proactive
value creation
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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What It Feels Like
—  Endless “firefighting” (unplanned work)
—  Conflicting priorities and requirements
—  Doing more and more with what seems
like less & less!
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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The #1 Question I Get Asked:
—  235,532 (Culture)
—  21,102 (Changing Culture)
—  23,580 (Changing Behavior)
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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Acting
Culture:
Thinking
“the customs, arts, social
institutions, and
achievements of a
particular nation, people,
or other social group.”
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
Thinking
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Defining Lean
—  Lean is a way of thinking for creating a highly effective
organization
—  Essential components of Lean
ü Applying methodical problem solving to
eliminate waste & variation to drive quality
ü Value Stream focus to flow value to the Customer
ü Learning through seeing, doing, seeing, asking &
presence
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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History of Process Improvement
mid-­‐1500s , continuous flow production
of warships – Venice
1793, interchangeable parts to cotton gin -­‐ Eli Whitney
Taylor, Gilbreth
Scientific Management
Shewart at
Bell Labs
Statistical Analysis/
Process Control
Feigenbaum publishes “Quality Control Principles”
Shingo Prize
Total
created
Deming
Quality
Visits Japan
Management
Juran
Visits Japan
1900
Henry Ford
Conveyor Line/
Process Flow
Taiichi Ohno -­‐ Birth of Toyota Production System
Theory of Constraints
Age of Scientific Management “Reengineering the Corporation” published
“Lean Thinking”
published
2000
1950
Training
Within Industry
“The Machine That
Changed the World”
published
Age of Engagement © Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
Lean Six Sigma
Agile Manifesto
Six Sigma
Motorola, Allied Signal, GE
Lean Office, Supply Chain, Health Care, Service Industries and beyond
Age of Integration 10
Lean Principles
Q
L
O
A
U
M
C
O
S
T
R
T
I
M
E
T
I
A
E
Y
L
Culture
Flow / Pull / JIT
Voice of
the Customer
Quality at
the Source
Systems
Thinking
Proactive Behavior
Constancy
of Purpose
Respect
for People
Pursuit
of Perfection
Source: Lean IT: Enabling and Sustaining Your Lean Enterprise, Bell/Orzen © 2010 © Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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The PDCA Cycle
Plan
Plan
Act/ Go & See
Adj
Do
Check
The scientific method is at the heart of
Continuous Improvement
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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The Great
Divide
Within most organizations there are many….
—  Silos
—  Sub-cultures
—  Areas of expertise, execution and focus
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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Barriers of Communication &
Coordination
—  Words
—  Measures, Reward & Recognition
—  Values
—  Paradigms (Attitudes, Behavior, Culture)
—  Multitasking & Information Overload
—  Conflicting Priorities
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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Many Silos and Many Islands
Gover nance
Consulting
Management
Enter prise
Architecture
Por tfolio Mgt.
Finance
Security
Customer
Relations
Supply
Operations
Business
Intelligence
Networ k
Web Ser vices
Database
Administration
QA
UAT
Regulator y
PMO
Product &
Service
Development
Operations
Information &
Information
Systems
Telecom
Maintenance
Middleware
Vendor Mgt.
Ser vice Desk
Application
S up por t
Ser vice Mgt.
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
Infrastr ucture
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Healthcare Enterprise Value Streams
Procurement
Information & Technology
Regulatory
Quality
Accounting
Pharmacy
Dental Operations
Clinical Operations
Human Resources
Patient Visit Value Stream
Lab Value Stream
Inbound Calls Value Stream
Patient Lifecycle Value Stream
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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IT Services Value Streams
Help Desk & Support
Operations
Infrastructure Engineering
App Dev/Maintenance
Portfolio Mgt.
PMO and Resource Mgt.
Prioritization, Delivery
Planning, Ent. Architecture
Governance, Budget
Application Delivery Value Stream
Service Desk Value Stream
Knowledge Management Value Stream
Telecom Value Stream
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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What is Operational Excellence?
—  Better, faster, cheaper
—  Dual focus leadership
—  Moving away from siloes to an end-to-end approach that
links business processes (value streams)
—  A learning organization
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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One Model
of
Operational
Excellence
GUIDING PRINCIPLES SUPPORTING PRINCIPLES
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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“Empowerment without alignment is chaos”
Peter Senge, Fifth Discipline
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
Alignment
ü  Clarify Objectives
ü  Identify Interdependencies
ü  Two-way communication
ü  Agreement of what is
important
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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Engage & Align: Top Enabled/Bottom Up
Executives
Managers
Continuous
Improvement
Initiatives
Strategic
Goals
and
Objectives
Associates
Individuals
PDCA
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
Strategy
Deployment
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The Role of HR
—  Change Management
—  Communications
—  Engagement
—  Shifting culture
—  Job Descriptions
—  Recognition & Reward Systems
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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The Current State = The Challenge
Most companies spend 60 - 80% of their
operating budget* just to keep systems
running, not investing in improvement or
innovation of the business.
Source: Pricewaterhouse Coopers Technology Forecast, Summer 2009
* Includes $, mindshare, focus, energy
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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HR…A Day in the Life
—Job Analysis and design
—Regulatory compliance
—Recruitment and selection
—Staffing
—Job evaluation/performance appraisal
—Health and safety
—Orientation
—Community relations
—Training and development
—Industrial relations
—Diversity Issues
—Ethics and Values
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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Case Study – Take I
Acquire a software application to address HR
request management
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Case Study – Take II
Develop a framework/structure for a scalable
internal-customer request process
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Outcomes
—  HR led by example:
—  Cross functional team
—  Value stream focus
—  A3
—  Process before technology
—  Their work served as a prototype for the entire
campus
—  Saved ~$300,000 in avoided acquisition costs
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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Reflection - Hansei
—  Methodical problem solving is the only thing that works
—  To understand, decompose work into discrete steps
—  Address root causes
—  Assume you need additional effort to
sustain improvements
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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Respect & Humility
Learning by Trial &
Discovery
Getting Comfortable with
Uncertainty
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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Everyone has two jobs…
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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The Roadmap
Start here
Strategy
Establish
leadership vision
and consensus
Articulate strategic
intent and drivers
Execution
Planning
Consolidate gains
& build momentum
Define and
communicate
the plan
Measure results,
assess understanding
and buy-in
Build a lean
Leadership team
Invest in enterprisewide infrastructure
Create a
basic toolkit
Launch pilot
kaizen projects
Assess key enterprise
value streams
Do, Check, Act
Plan
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© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
Next Steps
—  Acknowledge that the only lasting solutions
are built on a fundamental shift in behavior
and thinking
—  The best time to begin in now!
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.
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Thank You!
[email protected]
www.maorzen.com
LinkedIn: mikeorzen
Twitter: @MikeOrzenLeanIT
503.313.0023
© Copyright 2012 Mike Orzen & Associates, Inc. www.maorzen.com All rights reserved.