Why Lean Thinking and Shop Problem-Solving are Critical for Truck Equipment Distributors

Jon Sievert says he gets many different answers when he asks people to describe lean: tightening the belt; doing more with less; reducing inventory; cost-savings program; waste elimination; quality program; reducing head count; and turnaround tool.

“When you look at this word, it has come to mean many different things to people, and it also means not much to anyone,” said Sievert, senior VP of operations for Henderson Products. “Most people think of it as a manufacturing-focused set of tools. In actuality, lean is about problem-solving. Everything with lean is problem-solving. Those tools were all created to solve some sort of problem that someone has at some point along the way.”

In his presentation, “Why Lean Thinking and Shop Problem-Solving are Critical for Truck Equipment Distributors,” he said problem is often viewed as a dirty word.

“Someone comes up to you in the office and says, ‘I have a problem,’ and the first thing you think is, ‘Oh, no, now what?’ ” he said. “One of the first questions you need to ask on the lean journey is, ‘How does the word problem make you feel?’ Problems are our chances to improve our business. Problems are the way to find out what is truly going on. I once had someone tell me that someone who is experienced has made an awful lot of mistakes in his life. If you went through your entire life without making any mistakes, you’ve have lived in a bubble in a corner and didn’t do anything. As soon as you try something, somewhere along the line you are going to make a mistake. And have a problem. You have to figure out, ‘How am I going to attack that problem?’

“The true definition of a problem is knowing where you want to be and know where we are today. The difference between those two is a gap. Any time you have a gap, you have a problem. So typically problems are reactive. We want to be here, and our quality or our delivery, or whatever it is, is down here. You have this gap.”

He gave an example of a company that has a lead time of 120 days. Here are some things that go into it: sales and marketing activity; take the order; writing order, design and ordering material; fabricate the job; wait for paint; paint the job; receive accessories; final assembly; customer sign; deliver the job; fix any defects or make repairs; invoice; chase payments; and get paid.

The value items are: taking the order; fabricating the job; painting and final assembly; delivering the job; invoicing; and getting paid.

“Value is anything the customer is willing to pay for and also anything that positively affects the customer’s present situation,” he said. “Are you willing to pay for something that has a negative effect on your life? Do we find value in that? No, we don’t.”

Sievert said every single person in the audience has the same person working in their organization. His name is T.I.M. I. W.O.O.D.

“He’s just a normal-looking guy, but he’s in every single organization in the entire world,” he said. “T.I.M. is actually wanted in every one of our organization for distributing waste. We actually want to fire T.I.M.”

T.I.M. is actually an acronym for the eight deadly wastes:

• Transportation.

“Any excess or unnecessary movement of materials or information. Examples: chasing parts; walking to the parts room; moving vehicles in and out of bays; picking up a body and moving it slowly through factory. We can never fully eliminate transportation. But that person who’s transporting things could be adding value to the process. To figure out how much transportation waste you have, go to Wal-Mart and buy a $10 pedometer, put it on your employees, and every night break down how many miles they walk. We did this in our facility in Iowa. We had the actual shop techs wearing them. One individual walked 15 miles in one day. And he’s one of our most trusted employees.”

• Inventory.

“It can be in the form of piles of files, information, raw materials, work in process, and finished goods. It can be all the parts we have. It can be people. Inventory is an asset we need in order to run the business, but we often get too much of that asset. Inventory is like a big, cozy blanket. When we see the chassis lined up with daisies popping up in the fields, we feel nice and cozy. ‘Man, look at that backlog. Look at all that great work we’ve got to do.’ But who’s waiting on all that waste? The customer. Inventory makes us feel comfortable, but it’s a very expensive way to feel comfortable. Why is it waste? It ties up cash and space. It covers up problems.”

• Motion.

“Any movement or motion that does not add value. This one is tougher to see in most cases. It’s doing things I don’t necessarily need to do. I think about the surgeon. Does he get his own gauze pads? He puts his hand out and someone sticks it in his hand. If we need information, we have someone go find a computer and look it up. Every time we do that, we have motion waste. And we’re not adding value to the product.”

• Information wastes.

“It’s information that is unclear, incomplete, redundant, unavailable, unnecessary, or missing. We use lots of words. We have a document of specs that’s full of words. When someone wrote those words, they had a picture in their head of what those words would mean. Someone started grabbing it and reading them and building a picture in their head through words. But is the picture in my head the same as the person who wrote it? More than likely not. Information can actually get in our way, especially when it’s unclear or missing.”

• Waiting.

“One of the most frustrating forms of waste for employees is waiting. That involves waiting for: the copier; the scanner; a document to be retrieved; a reply to emails; information; the right tool; and equipment to become available. Look around, how many people at any one time are waiting for something? What are we not doing? Working. We take our minds off what we were working on and lose focus. Then we have to jump back to it. Every time you open up another thing to work on, the amount of work you have to manage every day continues to grow—all because I had to wait. Waiting becomes frustrating. Most employees get paid to do what they do, so nobody wants to stand around and wait.”

• Over-processing.

“Doing more than the customer wants, needs, or is willing to pay for. This one becomes part of waiting. Because we’re waiting, we over-process and open up another job. You’ve got all these half-built tasks sitting in the yard. ‘Oh. Bill’s on vacation, he started that job.’ Lots of times when we’re waiting, we want to add more value to the process. So we slow down what we do, we take a little more time to straighten up and to shrink-wrap everything real nice to make it look good for the customer. Typically, it’s because we have the time to do it—maybe more than the customer is willing to pay for. You’ve got to get back to that definition of value.”

• Over-production.

“Doing more than is necessary to meet customer demand. This can also be described as ‘make work.’ The industry is taking off right now and people are finding a boom in what’s going on around them. In order to get more done, we feel like we need to put more into the system. You end up putting significantly more in than what comes out. We put more work in. ‘Let’s see if we can find another spot to put in another chassis.’ We keep jamming more in and no one can figure out why we aren’t getting more out at the other end. It’s because we didn’t put the processes in place. We didn’t actually solve any problems that we needed to. We just shoved more into the system. Now we’ve got more costs and people and time tied up all because we wanted to get more out of the system.”

• Defects.

“Any mistakes or errors in the business. Defects are around us every day. When a defect happens, what’s the first question we ask? ‘Who did that?’ As soon as we ask the who question, boom, we just shoved everybody down. Who’s going to want to stand up and say, ‘Oh, I did that’? The challenge with defects is not to run people over when you find the defects. Ask, ‘What happened? How did that happen? What are we going to do to fix it?’ ”

He said a company has variability in its system—“strategic/competitive variability”—that helps it to continue to grow the business.

“Being able to do what the customer is looking for—this kind of variability is what we want,” he said. “We want to be able to create product lines that fit together, to have innovative solutions for the customer. We have to take that picture the customer has in his head and build it for him. The #1 question I get when it comes to lean and upfitting facilities or distribution centers is, ‘What about the customer piece? How do I deal with that?’ The first question I ask is, ‘OK, Customer A wants to build it this way and Customer B wants it this way. These are two things that are very different.’

“If you break it down to simple elements, what we do every day is consistent: hydraulics, turning wrenches, running torches. So what we want to try to do with variability is to actually increase strategic variability and decrease dysfunctional variability. Dysfunctional variability is waste. If we have all that waste in our systems, how can we increase that strategic variability?”

He said some people think 5S is “sweep, sweep, sweep, sweep, sweep.” That’s not exactly it, but cleanliness is important.

“Walk through the shop as if you were the customer,” he said. “Would you want your truck equipment installed by a shop that’s messy and has things all over the place? Look at your own facility and ask yourself if this shop looks like it can be relied on to deliver a quality product. When you look at it from the customer’s viewpoint, a nice, clean, organized, well-lit shop with people working all day long helps build trust. The customer is more confident that he will get the quality he’s looking for.”

He said system variability is understood through 5S:

• Sort: when in doubt, sort it out.

“People are emotionally attached to the things we have in our businesses, whether we believe it or not. I’ve done a couple of lean projects where we took seven dumpsters of stuff out of the facility. We had opened up a room that was full of stuff the previous owner had. We started unloading it out of the facility and ended up finding 5000 square feet of manufacturing space. All of it went in the dumpster—as the previous owner sat there and cried, ‘I might use that sometime.’ There’s this emotional attachment that goes into these things, so we have to be cognizant of that.”

• Set: a place for everything and everything in its place.

“What problem are we trying to solve by putting those tools up on that shelf? Getting that waste out of the system, that waiting time, that searching time, that motion. We’ll put it where everybody knows where it is.”

• Shine: cleanliness is next to Godliness!

“Here’s the thing about a clean facility: It lets us know when things aren’t right. That’s the biggest benefit of 5S—not that you get a clean shop. The biggest benefit is the ability to see problems, the ability to see waste, the ability to know when something is out of place and not in the right spot.”

• Standardize: constant drum beat.

“Every facility has a rhythm. Whether we’re in a custom facility or a full manufacturing facility, we have a rhythm. I once had someone tell me, ‘A clean shop is a slow shop.’ I stopped dead in my tracks. He said, ‘We’re only clean when we don’t have work.’ I said, ‘We’ve got to get that mentality changed.’ People say, ‘We don’t have time to clean today because we’re too busy.’ And yet we have plenty of time to go searching for tools and parts, as opposed to spending a few minutes every day cleaning up.”

• Sustain: rinse and repeat.

“This is the hardest one. Habits are hard to break. They say it takes 21 days to start breaking a habit. Those of you who have tried to stop smoking with a patch know that when you get to the third week, it actually starts to get easier. That’s because the human body and human brain take 21 days of consecutively doing something before it starts to become a habit. The number I usually don’t tell people is that it takes 1000 straight days of doing the same thing to become a habit. Habits are not easy to break. We have to continue to coach and mentor people.”

Sievert said value isn’t added in the office of the company president, but on the shop floor.

“Those individuals know more about the job, the situation, and the facility than anybody else does,” he said. “We need to involve them in everything we do. Train them in 5S, yes. But truly empower them to make the difference.

“At Henderson, we created a 5S committee. There were 11 on the committee, and it was made up completely of people from the shop floor. There was not a single management person on that committee. They run the program, audit each other, and it’s all peers on peers. They all work together. Disputes and resolutions do not go to a manager—they work them out together.

“And the sense of pride and ownership in that 5S program is outstanding. They actually created a trophy called the Golden Dump Truck. And the winner actually gets it. This thing has become literally the most coveted possession in the facility. When they carry it around and put it up in their area, then that other group just starts gunning for it. It’s friendly competition.”

Sievert provided what he called a “scary statistic”: only 2% of companies that are on the lean journey go anywhere. The main reason is attitude. People do not implement lean because they think, “Lean causes all kinds of problems. It doesn’t work in our building.”

“Lean does not cause problems,” he said “The problems have always been there. They’re just hidden underneath: inventory or people or space or broken processes or clutter. The problems are there. And as we start to work out those problems, guess what happens? More problems pop up. This is where the toughness comes in when you embark on the lean journey. Am I going to be the guy who wants to punch the computer? Or am I going to be the person who says, ‘Problem? We attack it. We’re going to go smoother.’ ”

His theories about problems:

• Anyone can solve problems.

“Teams are always better—cross-functional teams especially. Take someone from the office, take someone from the floor, take someone who knows hydraulics. Get that different set of eyes. Sometimes the innocent questions create the best ideas.”

• Sacred cows … make the best hamburgers!

“Every business has their own sacred cow. Maybe it’s, ‘We’ve always done it that way.’ Those sacred cows are a great place to go. When you take care of that sacred cow, you improve it or you fix it..”

• Try something … try anything!

“Whatever it is. Because I can tell you that as soon as you solve it, you take a step back and you’re going to go, ‘I could have done that a little better.’ You’re already thinking, ‘How can I make it better?’ That first step is when you solve that first problem.”

• He who tries the most … wins!

“Every time. If you do what you always did, you’re going to get what you always got. So just try something.”

• Solve one problem today!

“We have a campaign at Henderson where we’re teaching problem-solving to everyone in the organization. It’s actually called ‘Solve one problem today.’ We challenge everyone to solve one problem today. Every day, we solve more problems, and every day we get a little bit better.”

He said the traditional method of problem-solving is a plan that’s generally reactive (put out fires); follows a wing-it style (figure it out as we go); has a hesitancy to discuss problems; and features frequent use of “band aids.”

“As soon as you say ‘problems’ to a guy, he says, ‘I’ll fix it,’ ” he said. “We don’t take the time to dive into the problem. We see this every day. As soon as my wife tells me, ‘We have problems,’ I say, ‘Well, let’s try this.’ She always says, ‘I don’t want you to fix it. I just want you to know what’s going on.’ The same things happen in our business. We need to understand the whole story.”

What is the real problem?

• Plan.

“Spend the time to figure out the true problem. When we’re doing a plan, and we’re trying to figure out what the real problem is, we spend 60% to 70% of problem-solving time in truly identifying what the problem is. As soon as you define that problem, well, the solutions pop up right out of the woodwork.”

• Do.

“Just try it. It’s OK if it doesn’t go right, because you’re going to check it and adjust it. ‘He who tries the most … wins!’ I love that phrase. I also like this one: ‘He who tries the most and fails … dominates!’ Be willing to fail, be willing to have mistakes.”

• Check.

“Measure results: safety, quality, delivery, cost. Put them on a bulletin board so it’s visible to everyone.”

• Adjust.

“Try, try again. Let the measurement data help guide the team. Never give up. There is always a solution. Check the problem statement again.” ♦