Something Old is New Again

It was an unusual request. Normally when you think of Finance, you do not think of innovation, unless it was in a negative way, such as Enron or Bernie Madoff. But that's what the Director of Finance asked me as the Director of Operational Excellence. He wanted innovation and transformation in Finance…he wanted the department lean and efficient and improved.

This was great! This is the type of stuff you dream of when you do Process Improvement work; having heads of departments asking for help. But it also comes with challenges…

• What is the ask? Is there a specific problem to address? Or is it just a general “We need to improve?”
• Is Leadership really supportive? Or are they just trying to make a show of it?
• Are the workers involved and interested? Will they engage in change? Or is this a top-down mandate?

The answers for this request were as follows:

• No specific problem, but, seeing other CPI work being done in the company, the Finance Director firmly believes in the value of the work and that it can help his department.
• Leadership is supportive. Nobody at the C-Suite level was pushing this. It was the Department Director’s own initiative.
• The Director had a close relationship with his team: he talked with them daily, and could tell they were frustrated with the work they were doing. And this frustration was compounded by the fact that the team was short staffed. He had not talked to the team specifically about Improvement events but was confident they would be engaged.

This was a pretty good situation: leadership support, a willing team, and what appeared to be a “target-rich environment” of possible projects. But the workload and short staff threw a wrench into the works.

My initial thought was to provide some training for the Finance team and then work with them on projects coming out of the training. But the company’s basic Lean Six Sigma class was a week long, and the Department couldn’t have all their folks gone that long. Holding several classes to allow the finance team to spread out absence was not feasible for my team. Stymied, we agreed to think about it and continue discussions the next week.

Over the weekend, I happened to be cleaning up my home office. One the chores I had was to sort through the stacks of books I’d been referencing while writing my dissertation. Buried in the pile was a small leather-bound book, “How to Operate QC Quality Circles.”

Published in 1985 by the Union of Japanese Scientists and Engineers (JUSE) and edited by Kaoru Ishikawa (creator of the Fishbone Diagram), this little tome was a wealth of practical knowledge. More importantly, it inspired an idea for the finance team; they could form a Quality Circle.

When I met with the Finance Director the next week, I had a pitch ready for him. Instead of taking his team out of action for a week, then piling on more project work on top of their workload, we would form a Quality Circle. The team would formally meet once, maybe twice a week, and get CPI training and insights, and they could incorporate it into their work. It was low risk with high potential reward.

The Director loved it and agreed wholeheartedly. But he was still worried about time away from work. So he proposed having the QC meetings once a week over lunch. I was against that idea. Some people like their lunch breaks to be just that…a break. To get away from work. But Director offered to buy lunches for the team…

The company had a good cafeteria, and there was an adjoining conference room we could use to meet and eat, so it seemed like it could work. So we set it up, and the team loved it. Turned out they regularly ate lunch together, so the fear of intruding on their time was not an issue (still, I do not recommend it). And the six team members were an absolute delight to work with.

They were interested, engaged, and quick to pick up the teachings. The first few meetings were getting to know each other, their work, and I began teaching them bits and pieces of Lean. As I got to know more about their work and what was frustrating them I was able to tailor lessons for them.

Turns out a single process was causing much of their frustration: the purchasing order process. This activity had grown organically over the years with various directors modifying it. This led to there being several different variations of the P.O. process that were overcomplex. There was clearly overproduction (multiple approvals required that really were not needed) and clearly a need to create standard work.

Over a period of weekly lunches, the team redesigned the P.O. form and the process. They streamlined it and made it standard. And then they began using it, testing it, refining it using PDCA.

After a few months, the weekly lunches were not enough. The team was excited to be learning, and doing this Lean stuff. Soon they were stopping by my office to invite me to have a coffee, and eventually, we were meeting at least three times a week. Not quite the daily meeting that most Quality Circles have, but it is what worked for this team.

Eight months into the experiment, the Purchase Order process had been completely transformed. Not only did it make the finance team’s lives less stressful but it had added benefit of finding some dubious charges from Marketing that had previously slipped through the cracks. The team began working on the projects; revising the invoice process and standardizing bill payments.

About a year and a half after the team formed, the company had a reorganization. The Operational Excellence team was folded into the Engineering Department and my position, along with my two Black Belts that supported business operations were eliminated. Any Process Improvement focus was to be on manufacturing operations.

That lasted about a year until the company was acquired (ironically by a smaller company that was more innovative, agile, and focused on improvement). But I heard through my connections, the Finance team kept their Quality Circle going through all of it.

It’s rare that Process Improvement programs practice what they preach. But here was a case we broke from our standard week-long class to better serve our internal customers. Being innovative using an old idea found in a dusty little book.

#quality #lean #leansixsigma #operationalexcellence #processimprovement #totalqualitymanagement #storytelling #innovation  #lean #leantraining  #leanthinking