Business Plan

Business System Improvement Build Process

2 Year, High-Level Plan (Microsoft Project Validated)

  1. Phase 1: *** Management Engagement, Staffing, and Set-up ***,
  2. Educate the Management Team on the System Improvement Process,
  3. Management Commitment. Benefit: Executive Buy-In and Commitment,
  4. Start a Business Office of Toyota Operational Excellence,
  5. Staff up with 3 Black and 2 Green Belts. Start this early because this will take time and is a Critical Success Factor,
  6. Start the build of your Business System “Guiding Principles”. This includes goals, and responsibilities designed to create an agile and robust company, if not currently existing. Start with Toyota as a guide.
  7. Phase 2: ***Value Stream Mapping***,
  8. Agree on Success Metrics,
  9. Improve the performance of each Value Stream. For example, value Streams include every process between customer order and customer delivery. Value Stream performance is important, not Process performance. Value Streams move your business to create a focal point on Value Delivery.
  10. Use Value Stream Maps to Initiate Improvement Efforts. Benefit: Generate and Promote Measurable Benefits with Profound Knowledge of your Processes,
  11. Select Strategic Improvement Projects: (Your System is comprised of Value Streams). Map Value Streams on critical business systems as well as poor-performing systems. Benefits include:
    1. Profound Knowledge of each process in the Value Stream and then your system,
    2. Built-in performance metrics
      1. Increase Value Stream and Process velocity,
      2. Decrease costs, and
      3. Increase quality.
  12. Build Project Charters. This provides much-needed direction and project management guidance,
  13. Educate employees on Waste, or activities a customer would not willingly pay for. Use the Lean Six Sigma acronym DOWNTIMES.
  14. Phase 3: *** Initiate Value Stream Improvement Efforts ***,
  15. Select the target Value Streams to improve
  16. Initiate the Mapping of Value Streams, if not already existing. Two Green Belts supported by a Black Belt,
  17. Document and Promote the successes of targeting Value delivered and building project inertia,
  18. Initiate an Education and Instruction Program to increase improvement velocity,
  19. Start the Project Charter Build for each Value Stream. This provides much-needed direction and project management guidance,
  20. Investigate the usefulness of crucial Lean Six Sigma tools,
  21. Consider building an Operational Excellence Website containing:
    1. Toyota Production System (TPS) overview,
    2. TPS’s competitive advantages,
    3. Lean Six Sigma tools,
    4. Current Projects,
    5. The checkbox of Future Projects planned.
  22. Phase 4: *** Major Strategic Phase ***,
  23. Phase 5: *** SDD – Standardize, Document, and Display. *** Standardize on Best Practices,
  24. Establish success metrics,
  25. Initiate a system-wide standardization effort,
  26. Phase 6: *** Investigate Production Leveling Options. *** For instance, advertising may impact this,
  27. Phase 7: *** Determine areas of Flow potential. *** Utilize information from Value Streams.
  28. Establish success metrics,
  29. Investigate Value Stream Maps for Flow Potential
  30. Create Flow Where Possible.
  31. Publicise Success
  32. Phase 8: *** Start efforts to implement Kanban Pull around areas of Flow if it Makes Sense. ***
  33. Phase 9: *** Investigate andon solutions if Appropriate. *** andon means that you stop to fix a defect in a process or product when detected. Toyota still averages 800 a year. This helps create a Learning Organization,
  34. Above all, Establish the Metrics that demonstrate System Success,
  35. Phase 10: *** Initiate the Strategic Kata Continuous Improvement Effort, Educate Employees, & Select Value Stream Managers ***,
  36. Build the Kata structure for your system.
  37. Educate management on the process,
  38. Initiate build of Continuous Improvement Program by SelectingYour Improvement bogey, Toyota uses 6ms,
  39. Select Business VPs who benefit and care about improving their Value Stream,
  40. Select Value Stream Managers. It’s essential for future improvement that Value Streams have ownership. A Value Stream Manager would have additional time to perform other job functions such as managing other Value Streams or operational responsibilities,
  41. Select starting target Value Streams,
  42. Publish success results,
  43. Therefore an Estimated Progress Milestone: At the end of the first quarter, you will have put in place all the parts needed to optimize the implementation of your New Business System. Value Streams are Mapped and Improved. The next steps accelerate your march forward,
  44. Phase 11: *** Validate Milestones, Improve Supply Chain Relationships ***,
  45. Supply Chain. Benefit: Bring them closer to meeting your requirements whether lower prices or Just-in-Time
  46. Align your Supply Chain into 6 tiers of partners,
    1. Tier 1: Critical and Just-in-Time,
    2. Tier 2: Critical and Just-in-Time possible,
    3. Tier 3: Critical but no Just-in-Time,
    4. Tier 4: Other suppliers that deliver Just-in-Time,
    5. Tier 5: Other suppliers Just-in-Time possible, and
    6. Tier 6: Other non-critical suppliers.
  47. Explore enhanced relationships with Tier 1,
  48. Include in contracts a constant demand for increased Sigma performance,
  49. Determine which Tier 2 Suppliers could move to Just-in-Time,
  50. Toyota uses 2 hours of inventory as their Just-in-Time requirement. Determine your optimal Just-in-Time requirements,
  51. Phase 12 *** Future Actions ***
  52. Apply for a Baldrige Performance Excellence Award for Process Excellence,
  53. Phase n: *** Continue the path toward Greatness ***,
  54. (Optional, based on aggressiveness) Hire more Black and Green Belts. This will ramp up the improvement effort through your company, and
  55. Select additional critical and less critical Value Streams to map

Estimated Progress Milestones:

At the rate of 5 Values Streams Mapped and Improved every 4 weeks you will have:

  • First Quarter: 9 Value Streams, Kata Continuous Improvement stated
  • Second Quarter: 24 Value Streams, Kata Continuous Improvement maturing
  • Third Quarter: 39 Value Streams, Kata Continuous Improvement starting to show benefits
  • Fourth Quarter: 54 Value Streams, Kata Continuous Improvement operating smoothly
  • Second Year: 114 Value Streams (or more if you continue to staff up)

Benefits of your new Business System:

  • Profound Knowledge of your Production System
  • Operational Excellence (a competitive advantage)
  • Increased Value Stream velocity
  • Decreased costs
  • Improved product/service quality
  • Above all, Continued Improvement with a quest for Perfection

In Conclusion

This is a big effort, but measurable benefits start within the second month. This effort will move your business to constantly change, create an improvement culture, and comes with Performance Metrics. Your business is now on its way to excellence.