Category Archives: Value Stream

A VALUE STREAM is an end-to-end business process which delivers a product or service to a customer or consumer. The process steps along the way may both use and produce intermediate goods, services and information to reach that primary end.

Analysis may suggest the removal of intermediate process steps, goods, services and information that do not move the value stream forwards to its primary end, provided they do not serve important secondary ends such as compliance, quality control or employee loyalty.

VALUE STREAM MAPPING is a lean manufacturing technique used to analyze the flow of materials and information currently required to bring a product or service to a consumer.

Request For Proposal – Freight

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A salesman visits your company and suggests his company “On Time Trucks” is the best in the market and is going from strength to strength. It is also able to keep its rates at a very competitive level while beating all others on performance. You have all heard it before – if every transport company was this great, we would have product delivered next day anywhere in the world, for the same price it takes to deliver a letter.

Ok some are good and some will send you broke but it is up to you to decide before you take them on. Reviewing a few charge sheets and glossy brochures is NOT the way to do it.  You need an RFP (Request for Proposal or Request for Quote), basically via this document you are asking selected providers to give you a proposal in YOUR format. Why? so you can compare apples to apples – directly, without you having to manipulate or change data.

They will all promote the things they do best but what you really want is what can they do for you and at what cost. Their rates could show that although slightly expensive in one region they are super cheap in another. Do not trust this oversimplified premise.  Your best bet is to use real data (de-sensitized history) and get them to base their quote on that.  Then there are all the other benefits you will be expecting eg: compensation for damages and losses – remember they often state (in small print) that they are not “common carriers” and as such cannot be held accountable for damages or losses.  Wrong: you can ask them to advise you what regime/system they will use to compensate you, they always come up with something.

Freight is a major cost, along side storage, for any company that sells products.  Make sure you get the best provider for your type of product and delivery profile. This has the potential to reduce your total freight costs by as much as 30-40%.   Further information on how to write an RFP for freight is found on my FOCUS Expert page.

Cheers
Mark

To change -> begin with…..

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How does change happen, who wants change, who doesn’t want change, these plus other questions need to be asked before change can start,

One of the major barriers to change is often seen as apathy but can fact be fear “its always been done that way” or quoting Talking Heads  “same as it ever was” .

As an example, put five monkeys in a cage, inside the cage hang a banana on a string and place a set of stairs under it.  Linked to the stairs is a pressure switch which on being activated will spray the whole cage with water.

Before long, a monkey will go to the stairs climbing towards the banana.  As soon as he touches the stairs, cold water is sprayed into the cage. All monkeys get wet but the water stops when the “offender” gets off the stairs.

As there is no trend or suspicion of cause,  another monkey will soon make an attempt with the same result. Pretty soon the monkeys will get sick of getting wet, and will stop others from attempting to climb the stairs.  Keeping this process in place for several days to “ingrain” the process.

Now turn off the water, remove a monkey and replace it with a fresh one.

The new monkey will see the banana and attempt to climb the stairs. To his surprise, all the other monkeys attack him. Every time he tries he is attacked, so very quickly learns to not even try.

Now, remove another of the original five monkeys, replacing with a new one. The newcomer goes to the stairs and is attacked. Even the previous newcomer takes part in the punishment with enthusiasm. Likewise, replace a third original monkey with a new one, then a fourth, then the fifth.

Every time the newest monkey takes to the stairs, he is attacked.

Eventually every monkey will have been changed, there is now no knowledge of why newcomers are attacked when approaching the stairs as none of these monkeys have ever been sprayed, but it continues and sometimes with more vehemence than the originals!.

Why is this?

Because as far as they know that’s the way it’s always been done around here…

This is a survival instinct, people are the same.  It is a learned habit and as such needs to be unlearned, it cannot just be turned off (or explained away).

Before beginning down the path to change…   review your paradigms with all your stake-holders, as laid out in a workshop by Dr Nuri Robins :

1-   What paradigms do you want to protect?
2-   What paradigms do you want to reject?
3-   What paradigms have been challenged, unsuccessfully?
4-   What old paradigms get in the way of seeing the new ones?
5-   What paradigms are shifting or expanding at your company?
6-   What do you predict will become paradigms in the next three years?
7-  What is impossible to do now, but would radically change the way you do business if it were possible?
8-   What beliefs do you share with others in your small group about working at your company?
9-   What beliefs do you share with others in your small group about being a member of your industry?
10- What beliefs do you share with others in your small group about customer service in your industry?

This gives you a  “lay of the land”  allowing a meaningful plan of approach to be formulated .
Phase one down, now on to phase two (maybe the stairs are OK, or find another way).

Cheers and all the best for your change.

Mark