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| About Timothy Ferriss |
| Serial entrepreneur and ultravagabond Timothy Ferriss has been featured by dozens of media, including The New York Times, National Geographic Traveler, NBC, CNN, and MAXIM. He speaks six languages, runs a multinational firm from wireless locations worldwide, and has been a popular guest lecturer at Princeton University since 2003, where he presents entrepreneurship as a tool for ideal lifestyle design and world change. The 4-Hour Workweek is his first book on lifestyle design and details how to outsource and automate your life. |
Recent Article:
Push vs. Pull Processes
- For more on Timothy Ferriss visit www.4hourworkweek.com
Preface: This is a guest post from Michael Port on standardizing business processes–or personal productivity–to minimize excessive trial-and-error.
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Waste is a constraint. Reducing waste in your organization is one the easiest ways of reducing constraints.
And here’s a surprise—waste in offices is usually greater than in factories, especially because it’s easy to hide waste in cumbersome or non-existent processes. Creating unnecessary information inventory is another common waste in offices. Doing too many tasks “in anticipation” of a possible client, for example…
One way to think about waste is in terms of push and pull systems. A push system, like much of traditional manufacturing, produces as much product as the company can and/or wants to produce and then gets it out to the customer. The result is usually large inventories.
A pull system only produces what a customer needs and has asked for. You want to have as much “pull” in your systems as you can. Toyota has very little excess inventory. That’s why when the Prius was so unexpectedly popular, people found themselves on waiting lists for the car. Seems like a problem, but Toyota is much more profitable as a result of being so lean. You might also hear this concept referred to as “just-in-time production” or JIT (remember?—it came from the supermarkets).
I think of it this way—there’s a place for everything and everything in its place. No more. No less.
Here’s a story on how to reduce waste (figuratively and literally), by integrating people and process in a pull system. My Aikido dojo is on the top floor of a barn on a lavender farm with a view of a lake. It’s as extraordinary as it sounds. We don’t have a conventional toilet.
Instead, there is an incinerator toilet. You first press a button to start the heating system and then put a special purpose coated paper bowl liner (like a coffee filter, but don’t try using one for this purpose it won’t work) down between two sloping pieces of steel (sort of like a toilet bowl liner). You do “your business” into the paper filter, step onto a lever, and wave goodbye to your waste and any toilet paper. The toilet incinerates the filter and extra donations from you at a very high temperature, somewhere around 7,000 degrees Fahrenheit or the surface temperature of the sun, whichever is hotter. It’s a great way to eliminate waste. However, you can’t use the toilet without these special purpose coated paper bowl liners—they’re needed to keep the steel clean while also aiding in the incineration process. Many have tried and got a good scolding for it.
My teacher and his wife have implemented a very simple “pull system” so that we always have just the right number of liners. Not too many, which ties up money and takes up extra space with excess inventory. Not too little which can shut down the incinerator if it’s overburdened by non-regulation uses.
Over time my teacher and his wife have determined just how many boxes of this paper to keep on hand, based on the frequency of use. It happens to be four boxes. These boxes are then stacked on a specific shelf (the one closest to the toilet, not down the hall, which would create a different kind of production problem, but right where you need them—and can reach them).
On the bottom box is written—when you open this box tell George or Patti. You do tell them because it’s built into the culture of the dojo and you are part of the smooth functioning of the system. They then order 4 more boxes—and have determined, through learning by doing, just how long it takes to receive a shipment of 4 new boxes. It’s a very simple pull system that, in this case, only produces the right kind of waste.
As you can tell, there are a number of keys to success in this process.
Everything about this process is clearly visible and apparent to everybody involved in the process. If the box marked when you open this box tell George or Patti was inside a dark, hard to reach, cabinet, or it was written on the bottom of the box instead of on the flap that you have to open to get at the liners, it might not get noticed. The process relies on this visual indicator. Visual indicators or management charts, or checklists, etc. allow for communication and sharing. You can create standardized work sheets, but if you don’t have a way of seeing them, and the process, as if it were in a glass box, it’s likely that the standard practice won’t be followed and breakdown and waste will occur.
Problems have a way of bubbling up to the surface. The longer you let them simmer the bigger the problem will be when it surfaces. Our goal is to create standardized work processes that bring issues and problems to the surface, using visual indicators so no problems are hidden, at the earliest possible moment. People are stimulated by the visual, tactile and audible. People are part of the process.
Remember, we’re integrating. So it stands to reason that being able to see everything you manage is a balanced and harmonious way of creating flow in your work.
The Importance of Documentation
Early on in my business, I had a team member who would not document her processes, no matter how many times I asked, begged, and pleaded.
I spent hours coaching her on how to do it. I offered to hire someone to walk her through the process and essentially create the system for her. All to no avail. She eventually admitted to me that she thought that if she documented what she did, then I would just let her go. She seemed to think that standardizing might render her useless, as if it were somehow like mechanizing her job. Or maybe she thought that if I saw what she really did I wouldn’t think she was doing a good job. I told her that I wanted to standardize her tasks so her job would be easier and improve workflow throughout the organization. And furthermore, at this point, if she didn’t document and standardize her tasks I would be forced to hire someone to fill her shoes. Sadly, she didn’t come around and we parted ways.
Of course, this was ultimately my responsibility for not making documentation of process a standard procedure during the hiring process.
I know better now and have built into the hiring process a system of testing the ability of potential new hires to document a number of tasks. That way I can assess in advance of hiring them if they can and will do it.
Postscript from the Comments: The 7 Wastes of Toyota
Jeffrey K. Liker, author of The Toyota Way, says that Toyota has identified seven primary types of non value-adding waste in its business: over-production, motion (of operator or machine), waiting (of operator or machine), conveyance, processing itself, inventory (raw material), and correction (rework and scrap). Liker included an 8th waste (a personal favorite)—untapped employee creativity.
I have adapted Toyota and Liker’s lists for our purposes. So that they relate, not to a manufacturing process, but to a service business:
• Overstaffing—hiring people for whom there is not enough work.
• Overproduction—producing items (work) for which there are no clients or orders.
• Waiting—for information, resources, supplies, anything that slows down flow and creates waste.
• Over-processing or incorrect processing—activity, conversations, or processes that are not necessary or are incorrectly executed.
• Unused employee creativity—not enlisting and empowering your team, both intellectually and emotionally, in a continuous process of improvement.
In manufacturing, it’s often argued that overproduction is the greatest of all waste, since it causes most of the other wastes. I think the same could hold true for a service-based business. Not only overproduction of your services, but doing too much of everything that is not valuable to the internal or external customer. Overproduction waste, as Liker points out, “…leads to other suboptimal behavior, like reducing your motivation to continuously improve your operations.”
…
Typical business processes might be 90% waste and only 10% value-added work. Your objective is to create continuous flow in information processes and service processes. No one produces anything before it is needed by the next person or for the next step in the process.
Nothing should ever sit around waiting; except maybe things like cash savings in the bank for security and protection. Shortening the elapsed time from start of process to finished good or service will lead to best quality, lowest cost and shortest delivery time. There are at least two customers in this process—you and your paying customers at the other end of the process. Ensuring the best quality service benefits your paying customers and it’s also the best marketing. Ensuring the lowest cost benefits you as customer. Achieving the shortest delivery time might serve both you and your paying customer. But it might not. What’s the value of each of these objectives and where is it being created?
You might not have the best service, lowest cost and shortest delivery time. You might, however, find the optimal balance between the three. That’s the objective of all your processes.
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The above is a combination of two excerpts from Beyond Booked Solid, authored by Michael Port, who has been featured in the Wall Street Journal and on The Big Idea for his exploration of concepts ranging from Toyota’s best practices to standardized management of virtual assistants.
Push vs Pull Processes - To learn more about this author, visit Timothy Ferriss's Website.
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George LudwigGeorge Ludwig is a recognized authority on sales strategy and peak performance psychology. An international speaker, trainer, and corporate consultant, he helps clients like Johnson & Johnson, Abbott Laboratories, Northwestern Mutual, CIGNA, and numerous others improve sales force effectiveness and performance. Though it's George's strategies and processes that help corporations increase productivity and performance, it's his tremendous energy and dynamism that spark the transformation. Again and again, clients remark on his amazing ability to unleash human capacity and inspire men and women to break out of their comfort zones. The result is a whole new type of salesperson. His customized presentations teach achievers to make stunning advances in their lives. From helping salespeople realize cherished dreams to helping corporations exponentially accelerate revenue streams, George Ludwig leaves audiences and individuals empowered, emboldened, and clamoring for more. George is the best-selling author of Power Selling: Seven Strategies for Cracking the Sales Code and Wise Moves: 60 Quick Tips to Improve Your Position in Life & Business. - Visit George Ludwig's Website |
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