Book Review: Five Key Principles of Corporate Performance Management

IMG_20160621_0756429.jpg

As many of you know, I am constantly in learning mode. I am looking to learn the different perspectives of various items to not only help me, but my clients.

Recently, I finished reading ‘Five Key Principles of Corporate Performance Management’ by Bob Paladino. Mr Paladino is a specialist in helping companies to set up Corporate Performance Management offices (CPM). The CPM is a mechanism which can be used to link your corporate strategy, process improvement, and operations.

The strategic side of the CPM deals with the handling of the strategy map and the balance scorecard. The strategy map, as the name implies, maps out your strategy from the perspective of key operational processes to the higher level executive strategy. The balance scorecard is comprised of a set of Key Performance Indicators (KPI) for each step of the strategy map. Based off the two strategy tools, operational improvement projects are identified to be worked on.

Mr. Paladino takes the reader through a number of case studies of actual work he has done as an employee or consultant. It is much appreciated to see how all of these tools (Strategy Map, Balance Scorecard, Lean, and Six Sigma) are used together to help improve a company.

The concepts delivered from the book are great but the book is hard to read. Not because it is too technical but some examples lack certain pieces of information which will help to put the pictures together. In other portions of the book, there are some concepts which are revisited a number of times which make it hard to read due to boredom.

If you are a lover of strategy or process improvement, there are better books out there for you. If you are interested to learn how the two can be placed together, this might be the only book for you to read.

What is your most favorite business book?

Have an awesome and productive week.

Kevin

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups and donates platelets at the Canadian Blood Services clinic on a bi-weekly basis.

Kevin is hosting a workshop series known as Entrepreneurial Community Edmonton. The workshops cover different areas of business, including finance, human resources, and collections. You can find more information at http://www.l6sbc.ca/ecyeg.html

For help with your business, contact Kevin at kevin@L6SBC.ca or 780-868-1867. You can also follow Kevin on Twitter at @L6SBC or Facebook.com/L6SBC

Advertisements

ReBlog: Lean In Action

Over the next few weeks, I will be re blogging my most popular blogs from the past year.  I will be back blogging about business news and concepts in September. If you have any suggestions for blogs, feel free to contact me.

777_K64595-01_300x197

As you may know, I have been on a road trip through the States of Oregon and Washington. During a three-day stop in Seattle, I took the time to tour Boeing’s Everett production facility. The facility is comprised of three different buildings that manufacture the 747, 767, 777, and 787 Dreamliner airplanes. The main portion of the manufacturing is completed in the largest building in the world, by volume. The other two buildings are painting bays that put on the finishing touch to the planes before they are delivered to the end user.

It is obvious that Boeing has undergone lean activities. All workstations are cleaned and organized. Shadow boards were filled with the appropriate tool in the appropriate place. As you walk around the plant, you can see the flow of the production process.

Lean is now starting to become involved in the design of the planes. Over 6 million rivets were placed into the first 747 planes. With the newest version of the 747, over 1.5 million less rivets are used. Re-engineering of the plane with an emphasis on improving the production while maintaining safety has increased the number of planes made in a year. From the catwalk, it also looked like some engineers are now on the production floor to make it easier and quicker to have questions answered.

As in any company that is following lean principles, there are still areas of improvement available. Only 1 of 4 production lines allows for easy movement of the airplane during the production process. Two different production processes are utilized within the facility. Added training is required for workers to be transferable between the two production processes. Due to the body positioning that workers must put themselves into during the production process, some tasks require two people to complete the task. I also didn’t notice tool kits that could be easily moved in and out of the airplanes. What I did notice was production line workers spending time walking between their workstation and the shadow boards.

A very difficult problem to solve would be to move the paint shops to the same side of the highway as the production facility. As of right now, planes can only be moved to the paint shop at night.

Lean is a never-ending journey in improving your processes and people. Boeing is definitely progressing very well in their journey. Where are you on your lean journey? What projects are you working on?

Have a great week!

Kevin

Kevin MacDonald is a Business Consultant at L6S Business Consulting Inc (www.L6SBC.ca). L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin has his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups and donates platelets at the Canadian Blood Services clinic on a bi-weekly basis.

L6S Business Consulting will also be holding 3 sessions in regards to better understanding and using social media (Twitter, Facebook, and LinkedIn). For more information, please email: info@L6SBC.ca

Social Media Seminars

It Is Not In The Name

4105889356_7d3720f7b7_z

As with anything else, one thing can have various names behind it. At times, they are the same thing, but the basis and the methodology behind it is the same. This is also the case with process improvement, lean, process optimization, or process transformation. Essentially, these elements are the same thing.

While looking at my Twitter feed, I noticed a posting from EY Canada, the former Ernst and Young, that spoke about ‘Optimizing your operations through process transformation’. Click here to see a copy of the post. I opened the posting because I found it interesting due to my Lean Six Sigma background.

In reading the posting, it became obvious to me that they were talking about lean. Instead of calling it lean, they were calling it process transformation. Instead of recommending people to follow the DMAIC methodology (Define, Measure, Analyze, Implement, and Control), they recommended that companies Identify and Diagnose, Design, and then Deliver and Sustain on their process improvement projects.

All in all, with the different terminology, it has the same goal in mind. Identify waste or unrequired steps in your processes, take action to remove those steps, and develop a control plan for going forward. Being an accounting firm, EY Canada focused more on the business processes that occur within an office than the factory floor. In many cases, that is where the biggest savings are from lean activities.

The waste in an office is not visual, in many cases. You can’t physically see a journal entry travel within a computer, but by getting into the detailed process, steps can be identified which don’t add value or many actually add a layer of complexity to the process.

What methodology do you use to identify waste within your business processes? Have you completed a review of your business processes?

Have an awesome week.

Kevin

Kevin MacDonald is the CEO of L6S Business Consulting Inc. L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin holds his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups, his condo board and donates platelets at the Canadian Blood Services clinics on a bi-weekly basis.

Image: F Delventhal from Flickr Common Creative

Doing Lean the Wrong Way

12417381533_9c63f59f31_m

Over the past 6 months, the Alberta economy has been undergoing a correction due to the rapid price pressures on crude oil. Being a natural resource based economy, Alberta has become accustomed to the volatility which comes with the opportunity to develop our resources. Some companies have right-sized to the current operating environment which we are in.

I have spoken with a number of businesses lately in regards to their progress in their lean initiatives that they have taken. One of these companies was very proud in the decrease of expenses that they were enjoying through the lean initiatives. When I asked them how they were able to get such large cutbacks, they answered ‘We just cut our staff. Everyone is tightening their belts and working harder.’

In others words, the company used the terminology of being lean to decrease headcount but not improve their processes, the quality of their end product, or improve the customers’ experience with their product. When asked which tools they had used and how they came about the conclusion that the staff needed to be reduced, they stated that they spoke to their accountant.

The company didn’t complete a I/O Matrix or go through a 5 Whys conversation to help identify roadblocks in their progress, but used financial analysis in the name of being lean. Being an accountant, I don’t have an appreciation of the end product they developed. In the future, when employees are told that they are going to go through another lean activity, don’t expect employees to help along with their processes. They are just going to remember their co-workers who were dismissed due to a lean cause.

Lean is about developing a culture which fosters constant change and improvement in an organization. The goal of lean is to increase the engagement of staff and allow them to voice their frustrations and possible solutions to activities that they complete on a daily basis. Overall, these items help to increase your profitability.

Have you completed a lean activity? What steps did you take?

Have an awesome week.

Kevin

Photo Credit: mjtmail (tiggy) from Flickr Creative Common

Kevin MacDonald is the CEO of L6S Business Consulting Inc. L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin holds his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups, his condo board and donates platelets at the Canadian Blood Services clinics on a bi-weekly basis.

Wow Am I Busy!

OLYMPUS DIGITAL CAMERAWhen going to a networking event, water cooler talk, or catching up with a friend, it is a very common question to ask “How was your day at work today?” Commonly, we answer back “Oh, I was super busy!” Personally, I have always thought it was interesting that people answered that they were busy.

In my experience, if you were not busy working on something, why would you be employed there? Employers typically don’t hire people to have their feet on their desk or play Facebook games all day. If you are employed, I expect you to be busy, which is why I typical ask “What were you busy doing?” The answer I got… “Welllll…you know…stuff.”

Personally, when I am ‘busy’, I remember what I have been working on. At the very least, I can take out my to-do list and show you what has been working on.

Is telling someone you are busy the correct thing to say? Is ‘being busy’ a way of showing people your worth to a company? Is it a sense of pride to be busy? If that is the case, shouldn’t we be altering our answers?

What if you were to say “I have the Rothschild proposal progressing, got a new office manager hired, and made a huge breakthrough with a client”?

Being busy means that your plate is full but it doesn’t mean that you are productive. You could be working on a number of things, but maybe you are not prioritizing your efforts properly. You may be busy but you are fighting fires because a vision is not in place and an end goal is not there to be achieved.

Being busy is great….but what about being productive? Isn’t that the true badge of honour that every person should strive for at work? I believe that anyone can be busy, but not everyone can be productive.

How productive have you been during the last week?

Have an awesome week.

Kevin

Kevin MacDonald is the CEO of L6S Business Consulting Inc. L6S offers services in management consulting, Controller and CFO contracting, and lean management with either project work or teaching/mentoring of staff. Kevin holds his CMA accounting designation along with a Black Belt in Lean Six Sigma.

Kevin is active in the community by volunteering for different groups, his condo board and donates platelets at the Canadian Blood Services clinics on a bi-weekly basis.

Feel free to contact Kevin at @L6SBC or www.putechnologies.tk