Cycle Time Definition

Corporate trainers are increasing touting e-learning as an alternative to brick-and-mortar classrooms. It's no wonder. Lured by the promise of big savings, faster rollouts, and content that's available around the clock, enterprises large and small are coming to view classroom seminars as an expensive learning option. Travel concerns---and expenses---prompted by September's terrorist attacks have only bolstered the case for e-learning. American companies spent $4.2 billion on e-learning in 2001, a number that's expected to grow more than 50 percent per year to almost $15 billion by 2004, according to IDC estimates. This we hear from Eamon Hickey in the magazine, SmartBusiness.

If there were two things that all business gurus agree on, the first would be that knowledge is power. The second would be that for a company to remain competitive, education and training must be one of a its critical success targets. With the innovation of e-learning, there are now many options from which an organizations can select on-going education and training. These options range from courses on CD-ROM to high-end video-conferencing forums. At Business Basics, we specialize in the transfer of manufacturing competitive knowledge via e-tutorials on CD-ROM. E-tutorials provide self-paced learning …anywhere…anytime…for anyone. They score high on the cost-effective scale for companies seeking value added competitive knowledge.

If your company is still sitting on the sidelines relative to e-learning, today's lead article, "If Knowledge is Power, E-learning is a Competitive Weapon." may provide the motivation for "testing the waters."

Our kaizen guru, Enrique Mora tells me that his "Quick-Hitting Kaizen Pilot Project," schedule for 2002 is filling up. His projects can provide the foundation for increasing your MRP, ERP and lean manufacturing success. Its application methodology has proven to help manufacturing companies achieve linear production, decrease cycle times, improve on-time deliveries, improve customer satisfaction and increase productivity. Companies that master the kaizen techniques consistently exceed bottom line expectations. For more information about Enrique's projects go to: Kaizen Blitz 

An important long-term objective of your Competitive Knowledge Newsletter (CKN) is to help business teams reach their full performance potential. To this end , please feel free to make copies and share your newsletter with team members.

This newsletter has reached your desk because I think we share a common objective ... to help manufacturing teams avoid "burnout" while achieving their full performance potential. If this is not the case, simply click the link at the bottom of this newsletter and you will be removed from our mailing list.

Enjoy,

Bill Gaw, President
Business Basics, LLC
bg@bbasicsllc.com
760.945-5596

Featured Articles in This Month's Edition of CKN

1. If Knowledge is Power, E-learning is a Competitive Weapon
2. Cycle Time management
3. Organizing for Results
4. Something Old but Still Appropriate
5. Business Antidotes and Famous Quotes

1. If Knowledge is Power, E-learning is a Competitive Weapon

Even in tough economic times. Training is essential to the growth and development of the individuals and their organizations. Today's workers require more flexibility and often work longer hours than at any time before.

Distant education, or e-learning is an excellent solution to this growing training need. By incorporating computers and the Internet into the mix of tools available, organizations can provide training that is flexible, convenient, efficient, and less costly than more established methods.

On-line training is rapidly becoming and important tool in the arsenal of training and education. It is an effective addition to the current training approaches.

The benefits of online training go beyond simple convenience and flexibility. Unlike the traditional classroom, online courses provide each participant with the same information that can be accessed anytime and as often as necessary. Productivity is also protected since employees do not have to devote large periods of time to training but rather schedule short learning sessions over a period of time.

Popular e-learning options include online courses that can be completed in one or several sessions and can even be downloaded to a laptop computer for employees who frequently travel or those who prefer to learn at home. Often, this type of online professional development course offers information to participants in modules. The employee can review the learning content at his or her own pace and contact subject matter experts electronically for clarification and further discussion.

If you're not yet convinced that e-learning is right for your company, here are 4-reasons why you should be using e-learning:

1. Reduce costs…Save thousands on travel expenses and lost productivity by training employees online---at their own pace and according to their own schedule.
2. Accelerate the learning process…With no travel days or scheduling conflicts, you can get all of your people up to speed in weeks instead of months.
3. Extend coverage…Using virtual classrooms you can train each employee in every department across the company at once---and make sure they're all learning the same things.
4. People empowerment…choose your pace…choose your place.

Unisys leans heavily on e-learning because of its speed. "The organization that learns the fastest should prevail." explains Steve Trehern, a Unisys VP. Business moves too rapidly for us to do a couple of pilots, then roll out (a traditional classroom program) in six to nine months, because the marker has already passed us by."

In a recent survey of 5,000 employees at Fortune 500 companies, nearly half said they'd be enthusiastic if told they would be taught something online, and 19% admitted to preferring e-learning over any other method of instruction. People are now thinking, "I have to learn something…can I learn it online?" At more and more companies, the answer is yes.

2. Cycle Time Management

In a "Harvard Business Review" article by Joseph L. Bower and Thomas M. Hout, the authors makes a good case for "Fast-cycle Capability for Competitive Power." They observe that people in fast-cycle companies think of themselves as part of an integrated system, a linked chain of operations and decision-making points that continuously delivers value to the company's customers. In such organizations, individuals understand how their own activities relate to the rest of the company. They know how work should flow and how time and resources are supposed to be used.

In small companies, this way of thinking is usually second nature.

• People find it easy to stay focused on creating value because almost everyone works directly on the product or with a customer.
• Policies, procedures, practices, or people that interfere with getting the product out the door are easy to spot and can be dealt with quickly.

As companies grow, however, this "customer oriented focus" often gets obscured.

• Distances increase as functions focus on their own needs,
• Support activities multiply,
• Specialists are hired and
• Written reports/emails replace face-to-face conversations.

Before long the clear visibility of the product and the essential elements of the delivery process are lost. Instead of operating as a smoothly linked system, the company becomes a tangle of conflicting constituencies whose own demands and disagreements frustrate the customer. "I don't care what your job is," the overwhelmed customer finally complains. "When can I get my order?"

As manufacturers grow, they need to recognize this danger and work hard to avoid it by heightening everyone's awareness of how and where time is spent.

They need to:

• Make the main flow of operations from start to finish visible and comprehensible to all employees.
• Invest in this understanding with training.
• Highlight the main interfaces between functions and show how they affect the flow of work:

* compensate on the basis of group success and most important
* reinforce the systemic nature of the organization
*in their operations architecture.

Make certain that your company differs from traditional organizations in how they structure work, how they measure performance, and how they view organizational learning. Make certain that your company uses time as a critical performance measure; insist that everyone learn about customers, competitors, and the company's own operations, not just top management.

Long cycle times are a symptom of inefficient manufacturing performance and high non-value added costs. Manufacturers need to focus on the continuous reduction of all cycle times. Achieving success requires a specific management style that focuses on proactive problem solving, rather than "firefighting". In this process, management assumes a coaching roll, bringing all their people into the process and supporting them in their efforts to improve productivity, customer satisfaction and profitability.

If your manufacturing team can focus on only one continuous improvement project at a time (beyond fulfilling your customers quality expectations), then let it be the reduction of total build/test cycle time. To optimize speed, quality and costs, there just isn't any other more important success factor to pursue than cycle time management.

Many manufacturers have reduced lead times, improved on-time deliveries and increased profit margins by implementing a program of cycle time reduction. The main focus of such a program is the elimination of all non-value-added activities along the path of the product build/test cycle.

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3. Organizing for Results

How your team is organized has everything to do with how well your team will be able to produce results, according to Carl Larson and Frank LaFasto, authors of Teamwork. You would not, for example, structure your team along the lines of a military chain of command if you wanted to come up with a creative ad design.

How well does your team's organization match its goal?

If your team executes a well defined plan similar to the operation of a football team, a cardiac unit, or a naval vessel, it is a tactical team! This team's dominant feature is operational clarity. Goals, tasks, and roles are unambiguous and well organized. They communicate functions and methods, as well as scope of flexibility for problem solving. Successful tactical teams:

• Clearly define each operational procedure
• Specify each task and the responsibility of each role
• Make standards of excellence clear to all 
• Clarify measures of performance.

An example of one company's tactical team structure and success is Palomar System's 14-member, multifunctional (production, materials, engineering, sales), self-directed manufacturing team. Their successful implementation of Demand Based Manufacturing methodology produced impressive results. Typical cycle times were reduced from forty to eight days, inventory turnover increased from three to twelve turns and gross profit margins improved from 34% to 56%.

4. Something Old but Still Appropriate

There is little doubt in the minds of most people that individual achievement, while important to overall company performance, is no guarantee of success. Therefore it came as no surprise when I heard the results of a Harvard Business School study that concluded: when business management concentrates on the replacement of people as their main thrust in problem solving; problems tend to become unsolvable.

This study went on to say that trying to solve complex business problems by "changing the players" was a common characteristic of poor performing companies.

There are four basic elements in company performance:

GOALS, ROLES, RULES AND PEOPLE

GOALS - This is the company game plan that will define the level of achievement required by the team to assure a predetermined level of business success.

ROLES - A definition of the jobs to be done and who has the accountability and authority to execute.

RULES - The policies and procedures that form the basis of consistent action and

performance excellence.

PEOPLE - The players that make up the team; a company's most valuable asset.

The study concluded that companies that attacked these elements from the bottom up were losers, while companies that prioritized its problem solving from the top down were the winners.

It's literally amazing that when a company establishes its GOALS, defines the ROLES, and documents the RULES; PEOPLE problems disappear and the need to "change the players" seldom materializes.

5. Business Antidotes and Famous Quotes

It could only happen in New York.

It seems there was a pretzel stand out front of an office building in New York. One day, a man came out of the building, plunked down a dollar, and then went on his way without taking a pretzel. This happened every day for three weeks. Finally, the old lady running the stand spoke up: "Sir, excuse me, may I have a word with you?"

The fellow said: "I know what you're going to say. You're going to ask me why I give you a dollar every day and don't take a pretzel."

And the women said, "Not at all, I just want to tell you that the price is now a buck-fifty."

Every successful enterprise requires three people - a dreamer, a businessman, and a son-of-a-bitch.

- Peter McArthur

If two men on the same job agree all the time, then one is useless. If they disagree all the time, then both are useless

- Darryl F. Zanuck