Stories - USA VALUES, LLC

USA VALUES, LLC

7879 Somerset Ct.

Woodbury, MN 55125

651-735-3018

Stories help business communicate with the CEO's of K-12 districts about FTFRTFT, constraints and continuous improvement

As the president of USA VALUES I have several experiences with valuable continuous improvement. Every other leader has these types of stories to tell and my stories are like so many others. The private sector often takes doing first things first right the first time (FTFRTFT) for granted even though FTFRTFT aligns processes for high quality requirements, increased throughput, creates less work in process and generates lower total costs.

This true story is about a custom manufacturing plant that at the time had at least 200 production workers and 20 artists doing custom graphics per order. The company processed over 100,000 orders per year.

We found the Art Department was our constraint (bottleneck) and caused our productivity problems downstream because up to 20% of the orders were launched or made late in this department and 10% required subsequent rework. At the time, 1987, the board thought this was normal and I was instructed as the CFO and Executive Vice President of Operations to not blow it out of context in the fact that every department had its performance problems.

Manufacturing as an industry has learned much since then about managing constraints for cash flow improvement.

The company installed the capacity and information so that 100% of the orders came out of the art department on time done right the first time. This was not easy and the entire operation of the company including sales and marketing needed to change to make this possible and respected. This change reached everywhere including over 15 classes of customer trade.

Because of the change described,(installed a configurator into customer service that allowed no short cuts) the entire plant became on-time within 2 months, even though it took 18 months to fully inform the classes of trade that made the configurator run smoothly. This meant the business could take more short scheduled orders and still be on time and it could reduce its direct labor incurred after the bottleneck in total by at least 10% or 20 people. Stated requirements per work center were defined so on-time meant something and the company also saved time because of less rework and stalled orders in the plant and the art department.

But the bulk of savings came from being able to move most experienced laborers to the work that could be shipped that day. The plant started shipping 5-10% of the everyday orders early and that time was seen as strategic capacity.

All of the shifting could be done without executive input, most of the short scheduled orders could be taken without executive input. The business quickly grew to absorb the “extra” resources that were created in art and customer service. Going forward excess capacity was "stored" in the Art Department and used to keep the entire plant on time. The savings of twenty was offset by one.

The Art Department productivity remained roughly the same because the specific requirements were clearly stated to the five customer service departments. The customer service department productivity remained the same because they got the information from the customer right the first time. Everyone including the customers and sales and marketing were happier because exceptions were fewer. Clearly this higher quality was free.

Application to FTFRTFT in a school district

Our Art Department could be viewed as the kindergarten class, the department where everything in the process is viewed, projected and brought together in the plan and includes the first production/learning that absolutely has to stay on time if the school is to perform on time. This process step(s) allows the rest of the operation to flow downhill from the bottleneck and succeed. We learned it is rare to make up time against the schedule once it is lost because of dependent efforts. On-time out of the bottleneck department means all other requirements (they are more disbursed throughout the operation) could be met with a smoother and more flexible effort.

Being ready to read in kindergarten and reading in first grade insures the ability to keep up in subsequent grades. It is not rocket science to keep up and stay on-time once the first one or two requirements are met on-time. Early reading skills delivered or not when they must be not only delivered but received is the bottleneck in an elementary school.

Avoiding the exception is the definition of quality is free and applies in the school and the printing company. Aligning to avoid failing the requirements was fully paid for by the system of budgeted costs already in place. This expectation would be the same in the school as in the printing company.

Thomas D. Wolfgram

President