LEAN - an all time companion towards business targets...
Introduction
Continuous optimization and innovation are no longer delighters. They are already integrated as Business As Usual for people who are sustaining. The world is changing with the confluence of multiple pressures related to weakening currencies, inflation, credit crisis, oil pricing, consumer products pricing, fundamental changes to business models across industries, IT centricity, technology advancements, etc. . These are changing the fundamental nature of our Client’s Businesses. If we do the same way we do our business, we cannot sustain in the future world. There is a need to optimize the way we do everything, continuously... with an objective to give a multi fold customer value. Lean can lead to efficiency, effectiveness and innovations.
What does Lean mean?
Deliver exactly what clients need, when and where they need it at the expected quality level. Eliminate all activities that do not add value from customer's view. An holistic Lean implementation should address
1. Operations - The way processes and resources are used to create customer value, minimizing cost to serve. Focus should be on waste elimination, reducing variability and value levers.
2. Governance - Infrastructure needed to manage process performance and maintaining the processes through skilled people. Systems should be in place to manage the operating practices
3. People - Mind set of people on how they feel and act individually and as a team. People need to be given clear direction and skills to perform the work.
4. Voice of customer - Action based on continuous feedback from customers
How Services sector has adopted Lean?
Lean has been proven initially in manufacturing and process industries and during the last decade it has been proven in the Services sector as well. When everyone looks at reducing IT costs to their clients, Lean is something that will come at the top of agenda. We are now able to make the work measuarble and repeatable that enabled us to effectively leverage Lean in IT sector. Since we run with an optimized process, we are able to see improvement in the KPIs on Quality, Cost and Schedule
Typical Levers for IT services sector::
Demand/Capacity management:
Work load mismatch between applications causes some of the team members to over strain. Cross skill team members across applications/technology. Identify applications/work streams that can be consolidated based on complexity and domain and team members assigned to conserve overall team work load. Also reduce incoming work through data analysis. Make changes in work/ticket allocation – such as mapping complexity to skill. Forecast demand requirement through advance planning, staffing and better co-ordination with customer. This will result in SLA improvement, effort reduction, elimination of surplus capacity, improved work life balance, productivity improvement potential around 5%
Effort reduction through Automation:
Using VSM, revisit the existing process in a brainstorming session with team and identify manual tasks that can be automated, quantify effort savings and implement. Elimination of any manual step/activity shall be done to improve process time/cycle time thorough usage of tools. Testing services projects can look at automating the Test design, Test execution, test data and regression. This will result in Improved cycle time, reduced defects, improved work life cycle, productivity improvement potential around 5%
Display Performance metrics at Workplace:
Support projects have high variability in individuals’ performance metrics (time taken per ticket OR no. of tickets per person) impacting overall team productivity. Baseline individual level productivity and set target productivity, measure periodically and display. Use the visual display during daily huddle meetings to discuss project targets, performance and issues. This will result in Improved team morale, improved accountability and transparency, productivity improvement potential around 5%
Operations standardization:
Reduce NVA and variability. Perform Defect prevention activities. Plan and conduct reviews in early life cycle phases. Have a robust governance in place.
Productivity Improvement:
Bridge the skill gap of below average/average performers so that the overall team productivity is improved. Bridging Skill gap shall be done through various methods like
Training on Functional/Technical/Process aspects
Robust Knowledge management mechanism –KR, elearnings, FAQs, Discussion forum
Process improvements to reduce non value adds:
Usage of code review guidelines/standards/checklists
Define quality gates
Conducting group reviews
Implementing code hygiene tools
Streamlining Configuration Management
Early planning and scheduling of activities
Reducing time spent on meetings by following basic meeting etiquette
Improving server/workstation/network performance
Co-location of team members (Dev/BA/Testing),
Building Re-usable assets and encouraging Re-use
Conducting Phase-end Retrospections/Reviews
Improving test data identification methods
Creating test data repository
Optimizing Test cycles
Improving Requirements Management process
Tools Rationalization:
Help the client manage tools licenses and bring down the cost spent on licenses
Challenges in implementing Lean
Non availability of accurate past data for baseline
Not regular in conducting daily Huddle Meetings
Lean implementation plan not updated & tracked regularly
Non availability of reviewers for reviewing the implementation at planned milestones
Not having regular syndication of Implementation progress with Onsite team
Unable to cover short term projects
Limited Onsite commitment to the initiative (Less participation, limited ownership on the findings and solutions)
Unavailability of Estimation Model for certain project types (Data integration projects, Business intelligence projects, etc.) - to measure productivity improvement
Resistances for levers on Capacity/Demand Management, when the team is apprehensive to take it to the customer., which has a potential of 10 to 15% improvement.
Multiple initiatives in the organization
T&M projects - need to have customer buy in
Many improvements being non-strategic in nature
Tools & Techniques::
Governance:
Performance management assessment survey
Operations:
VSM
Operations efficiency analysis
People:
People aspects survey
Demand/Capacity analysis
Productivity analysis
Best practices for effective lean
For organization wide implementations, having cross business units reviews and experience sharing
Adopting Virtual Whiteboard when teams are across locations
Leveraging the expertize of Center of Excellence (CoE) teams wherever available
Having review checklists for reviewing the implementation progress at various milestone
Measuring Engineering maturity and adopting tools to improve
Having a centralised Knowledge repository
Process automation to create support tickets from emails
Application hardening to reduce tickets
Usage of standardized levers to identify more improvement opportunities
Effective and frequent performance feedback
Potential Benefits:
Large improvements in Work life balance & Span of Control
A culture of planning the tasks in advance, setting realistic Goals and Targets by the team
Service to customer by absorbing additional work load with the same FTE
Identifying effort spent on non-productive tasks and taking corrective actions
More planned trainings for up skilling
Increased Capacity Utilization – 10% to 20%
Improvement Productivity - up to 15%
Reduced Rework – From 4% to 1.5%
Improved test effectiveness – up to 3%
Reduced defect leakage – From 1.4 % to < 0.5 %
Increased Automation coverage
Recommendations
Have a process approach for lean implementation – have a framework defined with necessary guidelines, checklists and templates
Define and Implement standardized levers
Focus on Best In Class delivery
Bring leadership focus to get necessary support for the initiative
Have Rewards and Recognition mechanism to motivate best performers
Review the implementation at various milestones focussing on:
Team's awareness on KPIs, levers identified & interventions made
Huddles – whether happening regularly, Is the visual display dashboard updated regularly and being used for the daily huddles
If the team is lagging behind the set target, is there a get well plan?
Sustenance plan
Mask the employee name in the Individual Productivity display (in Visual Display Dashboard)
If the freed up employees are reinvested to create value adds for the same project rather than releasing the person for new opportunities, it needs to be streamlined to bring out tangible benefits
Visual display dashboards-procurement process to be initiated in early stages for timely availability
Focus on productivity improvements as well and not just on cost savings and people releases
Have knowledge sharing between projects that are implementing lean
Have the entire team participation including onsite