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A3 Management: From Structured
Problem-Solving to Workforceg
Development
Part I 0f II
Company
LOGO
Why is problem-solving so challenging?
It takes a different kindIt takes a different kind
of thinking to solve a
problem than the kind
of thinking that producedof thinking that produced
the problem.
-- Albert Einstein
© 2011 Karen Martin & Associates 2
Deming’s PDCA Cycle
Plan
Develop
hypothesis
& design
experiment
DoAct
Conduct
experiment
Analyze
results &
take DoAct experimenttake
appropriate
action
© 2011 Karen Martin & Associates
Check Measure
results
What is A3?
The core of Toyota’s renowned management
systemsystem.
A structured method for applying the PDCA
(plan-do-check-act) approach to problem-(plan do check act) approach to problem
solving.
International designation for 11 x 17” paper.
© 2011 Karen Martin & Associates 4
For Further Study
Sample A3 Report
Plan Do, Check, Act
6
The A3 Report
 A concise “story board” that reflects the problem solver’s
discoveries and thought process along the waydiscoveries and thought process along the way.
 Limited “real estate” develops precise thinking.
 A “living document” that reflects the iterative nature of
problem solving and enables organizational learningproblem-solving and enables organizational learning.
 Highly visual – graphics, charts, maps, drawings, etc.
 “Making it pretty” isn’t the goal – hand drawn A3s are OK Making it pretty isn t the goal hand drawn A3s are OK.
 Neither the format nor the specific sections are set in
stone.
 Beware of using “templates.”
 Serve the iterative nature of the problem-solving process.
© 2011 Karen Martin & Associates 7
The A3 Report Should Reflect the Process
© 2011 Karen Martin & Associates 8
George Koenigsaecker, Leading the Lean Enterprise Transformation.
Benefits of the A3
 Creates consistency in how the
organization goes about solvingg g g
problems.
 Builds problem-solving capabilities
across the entire organi ationacross the entire organization.
 Trains everyone how to drill complex
problems down to their most essential
l telements.
 Forces a holistic/comprehensive view of
the problem and solutions; requiresp ; q
collaborative problem-solving.
 Reduction in “silo-ism”
 Th h t l d
© 2011 Karen Martin & Associates
 Thorough root cause analyses reduce
the risk of “band-aid” solutions.
9
Benefits of the A3 (continued)
 Ownership role drives accountability and reduces risk of
“it’s everything else’s problem ”it s everything else s problem.
 Stimulates data-driven decisions.
 Fairness and accountability replace blame and deceit. Fairness and accountability replace blame and deceit.
 Transparency re: problems spawns a commitment to
action.
 Develops deep organizational capabilities.
© 2011 Karen Martin & Associates 10
Problem-Solving Steps
1. Identify the problem
2 E l th bl d l
Plan
2. Explore the problem deeply
 What’s the true root cause?
3 Consider potential solutions
At least
50% of
th t t l 3. Consider potential solutions
 Hypothesize
4. Test solutions
the total
time
4. Test solutions
 Confirm hypothesis
5. Implement solution(s)Do
6. Measure results
 Did the hypothesis prove out?Check
A
© 2011 Karen Martin & Associates
7. Adjust as needed; prepare
to improve again
11
Act
Common Components of the A3 Report
Theme: Owner:
Plan Do, Check, Act
Theme: ________________________________ ________________________________
Background Countermeasures / Implementation Plan
Current Condition
Effect Confirmation
Target Condition / Measurable Objectives
Follow-up Actions
Root Cause & Gap Analysis
A3 Roles & Responsibilities
Problem owner
 Individual who’s accountable both for
the results and the process for
achieving results.achieving results.
 Problem owners have the authority to
engage anyone needed and the
ibilit t ll l tresponsibility to engage all relevant
parties.
CoachCoach
 Person teaching the owner the problem-
solving process.
© 2011 Karen Martin & Associates
 Typically the owner’s direct supervisor.
13
Common Components of the A3 Report
Theme: Owner:
Plan Do, Check, Act
Theme: ________________________________ ________________________________
Background Countermeasures / Implementation Plan
Current Condition
Effect Confirmation
Target Condition / Measurable Objectives
Follow-up Actions
Root Cause & Gap Analysis
Common Components of the A3 Report
Theme: Owner:
Plan Do, Check, Act
Theme: ________________________________ ________________________________
Background Countermeasures / Implementation Plan
Current Condition
Effect Confirmation
Target Condition / Measurable Objectives
Follow-up Actions
Root Cause & Gap Analysis
Coach / Mentor’s Role
Assure problem is relevant to the
organization’s annual business goals.
 Focus resource use on the relevant few rather
than the trivial many problems.
© 2011 Karen Martin & Associates 16
The A3 Process:
Define the Theme
What is our area of focus?
Articulating the right theme will force you to
focus on the right problem.
Should be closely aligned with organizational
goals to avoid spending limited time and
resources on trivial issuesresources on trivial issues.
Avoid judging, concluding re: cause, or offering
solutionssolutions.
 E.g.: Flawed order entry process vs. Streamline order
entry process
© 2011 Karen Martin & Associates
y p
17
Common Components of the A3 Report
Theme: “What is our area of focus?” Owner: Person accountable for results.
Plan Do, Check, Act
Theme: What is our area of focus? Owner: Person accountable for results.
Background Countermeasures / Implementation Plan
• What?
• Who?
• Problem statement
• Context - why is this a problem? (visual)
Current Condition
Who?
• When?
• Where? (if relevant)
Di f t it ti
Context why is this a problem? (visual)
Effect Confirmation
• Diagram of current situation or process
• What about it is not ideal?
• Extent of the problem (metrics)
• What measurable results did the solution
Target Condition / Measurable Objectives
• Diagram of desired state
• Measurable targets – how will we know that
achieve (or will be measured to verify
effectiveness)?
• Who’s responsible for ongoing
measurement?
Follow-up Actions
g
the improvement has been successful?
Root Cause & Gap Analysis • Where else in the organization can this
l ti b li d?• Graphical depiction of the most likely direct
(root) causes
solution be applied?
• How will the improved state be standardized
and communicated?
The A3 Process:
Background
Include a problem statement
 State the problem; do not offer a solution State the problem; do not offer a solution
Background – information for understanding the
importance and extent of the problem.
H d th bl l t t l ? How does the problem relate to company goals?
 How was the problem discovered? How long has it
been a problem?
’ ? What evidence demonstrates that there’s a problem?
 What degree of variation exists currently compared to a
previous state?
Tailor information for the audience.
Present information visually.
“S ll” th d f i t t f
© 2011 Karen Martin & Associates
“Sell” the need for improvement; create a sense of
urgency.
19
Sample Background Material
sss
Gray – highest industry quality scores
P l i d t lit (b h k)
FY 2008 FY 2009 FY 2010
Purple – average industry quality scores (benchmark)
Blue – client quality scores
20
Sample Background Material
0
00
21
Coach / Mentor’s Role
Ask probing questions to assure proper
background has been obtained and
depicted as concisely as possible.
 Aiming for emotional impact – why is this a
problem?
Don’t tell the problem owner what to
include!
Teach visual display options is owner is
unfamiliar with them.u a a t t e
© 2009 Karen Martin & Associates 22
Potential Development Need
Become proficient in visual data display
options:
 Bar charts
 Histograms
 Trend / line charts
 Pie charts
 Pareto charts
 Etc.
© 2009 Karen Martin & Associates 23
Common Components of the A3 Report
Theme: “What is our area of focus?” Owner: Person accountable for results.
Plan Do, Check, Act
Theme: What is our area of focus? Owner: Person accountable for results.
Background Countermeasures / Implementation Plan
• What?
• Who?
• Problem statement
• Context - why is this a problem?
Current Condition
Who?
• When?
• Where? (if relevant)
Di f t it ti
Context why is this a problem?
Effect Confirmation
• Diagram of current situation or process
• What about it is not ideal?
• Extent of the problem (metrics)
• What measurable results did the solution
Target Condition / Measurable Objectives
• Diagram of desired state
• Measurable targets – how will we know that
achieve (or will be measured to verify
effectiveness)?
• Who’s responsible for ongoing
measurement?
Follow-up Actions
g
the improvement has been successful?
Root Cause & Gap Analysis • Where else in the organization can this
l ti b li d?• Graphical depiction of the most likely direct
(root) causes
solution be applied?
• How will the improved state be standardized
and communicated?
The A3 Process:
Current Condition
Two primary goals
P id th di ith i f th t Provide the audience with an overview of the current
process.
 Demonstrate a fact-based understanding of the problem.
Content
 Provide a visual overview of the current state process or
system (strong use of charts maps graphs tablessystem (strong use of charts, maps, graphs, tables,
photos, etc.).
 Highlight key factors in the current state.
 Provide evidence of the problem (data)
 Avoid qualitative opinions.
 Avoid suggesting solutions or judging
© 2011 Karen Martin & Associates
 Avoid suggesting solutions or judging.
25
Common Components of the A3 Report
Theme: “What is our area of focus?” Owner: Person accountable for results.
Plan Do, Check, Act
Theme: What is our area of focus? Owner: Person accountable for results.
Background Countermeasures / Implementation Plan
• What?
• Who?
• Problem statement
• Context - why is this a problem?
Current & Target Conditions
Who?
• When?
• Where? (if relevant)
I l d d t t i t bl
Context why is this a problem?
Effect Confirmation
• Include pre- and post metrics table
• What measurable results did the solution
Metric Current State
Desired Target
Condition
Projected %
Improvement
Lead Time
Quality
Labor Effort
achieve (or will be measured to verify
effectiveness)?
• Who’s responsible for ongoing
measurement?
Labor Effort
Morale/Turnover
Inventory Turns
Market Share
Follow-up Actions
Root Cause & Gap Analysis • Where else in the organization can this
l ti b li d?
Returned Parts
• Graphical depiction of the most likely direct
(root) causes
solution be applied?
• How will the improved state be standardized
and communicated?
Coach / Mentor’s Role
Ask probing questions to assure relevant
metrics have been selected.
 3-5 key performance indicators
 How will we know if we’d been successful?
© 2011 Karen Martin & Associates
27
Current State Documentation
Options
 Go to the gemba! – OBSERVE
 P f / dit d t Performance / audit data
 Mapping
 Value Stream Maps (VSM) - strategic Value Stream Maps (VSM) strategic
 Metrics-Based Process Mapping (MBPM) – tactical
 Spaghetti diagrams
 Documentation / job aid review
 Videotape / photos
 W k i t i Worker interviews
 Work samples
 Etc
© 2011 Karen Martin & Associates
 Etc.
28
Sample A3s – Current State
Poor
correspondencep
quality
Missing
inventory
resulting inresulting in
write-offs
Common Components of the A3 Report
Theme: “What is our area of focus?” Owner: Person accountable for results.
Plan Do, Check, Act
Theme: What is our area of focus? Owner: Person accountable for results.
Background Countermeasures / Implementation Plan
• What?
• Who?
• Problem statement
• Context - why is this a problem?
Current Condition
Who?
• When?
• Where? (if relevant)
Di f t it ti
Context why is this a problem?
Effect Confirmation
• Diagram of current situation or process
• What about it is not ideal?
• Extent of the problem (metrics)
• What measurable results did the solution
Target Condition / Measurable Objectives
• Diagram of desired state
• Measurable targets – how will we know that
achieve (or will be measured to verify
effectiveness)?
• Who’s responsible for ongoing
measurement?
Follow-up Actions
g
the improvement has been successful?
Root Cause & Gap Analysis • Where else in the organization can this
l ti b li d?• Graphical depiction of the most likely direct
(root) causes
solution be applied?
• How will the improved state be standardized
and communicated?
The A3 Report:
Targets / Measurable Objectives
Purpose
 How will we know that the improvement has been
successful?
 What standard or basis of comparison will be used? What standard or basis of comparison will be used?
Pointers
 Use measurable objectives when possible Use measurable objectives when possible.
 Consider how data will be collected and shared to
evaluate the effectiveness of the implemented
solution(s).
 Begin planning for the Effect Confirmation section, but don’t
focus on it yet.
© 2011 Karen Martin & Associates
y
31
Target Condition vs. Effect
Confirmation
When setting target metrics, begin thinking
how you’ll confirm performance (effect
confirmation section).
 Who? How frequently? How?
© 2011 Karen Martin & Associates 32
Coach / Mentor’s Role
Ask probing questions to assure target
condition meets business needs.
It’s better to set stretch objectives and notj
quite reach them than set objectives that
you’re sure you’ll hit.y y
© 2011 Karen Martin & Associates
33
Common Components of the A3 Report
Theme: “What is our area of focus?” Owner: Person accountable for results.
Plan Do, Check, Act
Theme: What is our area of focus? Owner: Person accountable for results.
Background Countermeasures / Implementation Plan
• What?
• Who?
• Problem statement
• Context - why is this a problem?
Current Condition
Who?
• When?
• Where? (if relevant)
Di f t it ti
Context why is this a problem?
Effect Confirmation
• Diagram of current situation or process
• What about it is not ideal?
• Extent of the problem (metrics)
• What measurable results did the solution
Target Condition / Measurable Objectives
• Diagram of desired state
• Measurable targets – how will we know that
achieve (or will be measured to verify
effectiveness)?
• Who’s responsible for ongoing
measurement?
Follow-up Actions
g
the improvement has been successful?
Root Cause & Gap Analysis • Where else in the organization can this
l ti b li d?• Graphical depiction of the most likely direct
(root) causes
solution be applied?
• How will the improved state be standardized
and communicated?
The A3 Report:
Root Cause Analysis
Show the root cause of the problem(s) identified
i th t t tin the current state.
Separate symptoms and opinions from cause-
d ff t d t i tiand-effect determination.
Consider which techniques will be most useful in
gaining root cause insightgaining root cause insight.
Identify additional tests, if needed, to establish
level of certainty re: cause and effectlevel of certainty re: cause and effect.
Summarize your findings visually.
© 2011 Karen Martin & Associates 35
Root Cause Analysis
© 2011 Karen Martin & Associates 36
Root Cause Analysis (RCA)
RCA is necessary to:
 Avoid jumping to conclusions.
 Avoid creating “band-aid” fixes
(addressing only the symptoms)(addressing only the symptoms).
 Select proper countermeasures.
 Design and implement lasting Design and implement lasting
solutions that truly eliminate the
problem.
© 2011 Karen Martin & Associates 37
Root Cause Analysis Tools
Simple problems
 Five Why’s
 Problem Analysis Tree
More complex problems
 Brainstorm causes (fishbone) If Brainstorm causes (fishbone)
 Tally frequency of most likely causes
(check sheet)
If
necessary
( )
 Identify relevant few (Pareto analysis)
for countermeasure development
© 2011 Karen Martin & Associates
p
38
Five Why’s Example
Problem: Report is taking too much of an employee’s time;
1. Why is the error report being prepared?
Problem: Report is taking too much of an employee s time;
team questions whether the report is needed
1. Why is the error report being prepared?
 My supervisor told me to.
2. Supervisor – Why are you asking for this report?
One of the standard reports to be prepared per my One of the standard reports to be prepared per my
predecessor – I have yet to determine its usage.
3. Predecessor – Why did you initiate this report?
 Report was required in the past because personnel in
order entry were making data input errors.
4. Data entry – Why were orders being input with errors?
 Orders received via fax were blurry and hard to read.
5. Data entry - Why were the fax orders hard to read?
 Fax machine was old and of low quality. It was replacedq y p
10 months ago and errors no longer are occurring.
Problem Analysis Tree
Problem: Documents are not being translated well and on time
Lost docs*
In physical transit
In cyberspace
In in-basket
No tracking
Large batches
Late or poorly
In out-basket
Poor
original
Confusing
formats
Faxed / poor
resolution
Late or poorly
translated
documents
Translation
Translator doesn’t
understand original
original
Translator
skills
Random
vocabulary
Selection
problems** Translator
understands
original, but still
poor translation
skills
Wrong
technical
vocabulary
Lack of training
No standard
Training
poor translation vocabulary
Poorly
expressed
No standard
Unclear
expectations
Poor editing
* Lost and found = 40%; lost & never found = 5%; stuck in system = 55%
** Rework on over 50% of documents
p
Uneven
workload
Cause-and-Effect Diagram
(aka Fishbone, Ishikawa)
Brainstorming tool used to identify most likely
causes for an undesirable effectcauses for an undesirable effect
Explores potential causes in 6 categories (6 M’s):
 People (“Man”) People ( Man )
 Material/Information - Inputs used in the process
 Method - Procedures, work instructions, processes
 Machine - Equipment, computers, tools, supplies
 Measurement - Techniques used for assessing the
quality/quantity of work, including inspectionq y q y , g p
 Environment (“Mother Nature”) - External & internal
Use other categories if appropriate
© 2011 Karen Martin & Associates 41
Cause-and-Effect Diagram (continued)
Effective brainstorming tool
 Forces teams to consider all possible causes
Decreases the likelihood that something is being
l k doverlooked
Shows us the possible causes, but not how
much each contributes if at all to the problemmuch each contributes, if at all, to the problem
Does not provide solutions / countermeasures
© 2011 Karen Martin & Associates 42
Cause-and-Effect Diagram
People Material / Info Method
Lack of experience No stnd spread sheet Changing scheduleLack of experience
Time availability
No sense of import
No stnd spread sheet
No standard work
Input rec’d late
Changing schedule
Budgets
Submitted Late
Email vs. FedEx
Forecast in other system
Manual vs. PC No milestones Weather delays
M hi M t E i t
System avail. $ vs. units
y
Dispersed sales force
Machine Measurement Environment
Techs Moving Product
Skill Set
Man
Man Power Flexing Between Families
Schedule
MachineMethods
Batching
Blue affect productivity
Yellow Most affect TAT
Estimates
Sap Data Entry
Shared Equipment
FIFO for Repair Units
Cherry Picking Troubleshooting
Variation in complexity
Data Collection
GMP
R
Complaints Sent to W.R.
Testing Guidelines
Tech Documentation
Ease of Use Flex Schedule/Breaks
Repair TAT
Reason
Low Backlog
Planning
No Std Repair
Productivity
Non Standard Bench Set Up
Bag Refill Process
Labor Time Collection
Demand Variation
Bag Refill Process
Component Parts
Feed Back Frequency
Shipping By product Line
MaterialsMeasures
Incorrect Dates Recorded
Environment
Check Sheets
Helps collect and record process data in an
i d ?organized way?
 How often are various events occurring?
P id f t b t t d i d tProvides facts about a process to drive data-
based conclusions.
Include the “likely candidates” from the CauseInclude the likely candidates from the Cause-
and-Effect diagram.
Basis for Pareto analysisBasis for Pareto analysis.
Note: Data collection must be easy and time-
limited or it won’t happen
© 2011 Karen Martin & Associates
limited or it won t happen.
45
Root Cause Analysis: Late Shipments
Check Sheets Quantify Occurrences
Reason TallyReason Tally
Material shortage ||||| ||
Quality issue requiring |||||Quality issue requiring
rework
|||||
Staffing/absenteeism ||||||
Order entry error ||||| |||||
Changing customer ||||| ||||| |||
requirements w/ no
adjustment to expected
delivery
||||| ||||| |||
© 2011 Karen Martin & Associates
Equipment failure |
46
Pareto Analysis
Named after Wilfredo Pareto (18th century Italian
economist/statistician) who discovered the 80 20economist/statistician) who discovered the 80-20
principle.
 20% of the people held 80% of the wealthp p
Focuses our attention on the VITAL FEW issues
that have the greatest impact to avoid spending
th TRIVIAL MANYenergy on the TRIVIAL MANY.
A type of bar graph that displays
information/data in order of significanceinformation/data in order of significance.
A visual aid for defining & prioritizing problems.
© 2011 Karen Martin & Associates 47
Pareto Chart
Credit Application Delayspp y
2909
86%
100%
97%
94%
3000
3500
90%
100%
2493
77%
86%
2500
nces
60%
70%
80%
41%1500
2000
Occurren
40%
50%
60%
627
561
1000
20%
30%
40%
561
242
180
0
500
0%
10%
20%
No Signature Insufficient Bank
Info
No prior address Current
Customer
No Credit History Other
Reason for Delay
Coach / Mentor’s Role
Teach root cause analysis tools if owner
isn’t yet proficient.
Ask probing questions to make sure truep g q
root cause has been found.
© 2011 Karen Martin & Associates
49
Nailing the Plan phase of
PDCA is the mostPDCA is the most
important step in the
entire problem-solving process.
© 2011 Karen Martin & Associates 50
Planning Reminders
Background
 Need to quantify the problem to reduce
subjective / emotional responses
 Financial Financial
 Labor effort (which can be monetized)
 Lead time / responsiveness (which can be
monetized)
 Market share
 Compliance-related Compliance-related
 Problem definition – proper scoping is vital!
 Include a precise problem statement in
© 2011 Karen Martin & Associates
p p
background section.
51
Planning Reminders (continued)
Target Condition / Desired state
Li t t t d f t i t th l ti ! List targeted performance metric, not the solution!
 Must include measurable objectives
 Include both % improvement and the raw numbers (fromInclude both % improvement and the raw numbers (from
what to what)
Root cause
 You cannot solve a problem without knowing it’s root
cause!
 Avoid making assumptions “Do you think or do you Avoid making assumptions - Do you think or do you
know?”
 When multiple root causes exist, quantify and select
© 2011 Karen Martin & Associates
the relevant few for countermeasure development.
52
Plannning Reminders (continued)
Displaying information visually aids
tremendously in the absorption rate of thetremendously in the absorption rate of the
information
 Pie charts, trend charts, graphs, bar diagrams, , g p , g
 Drawings
 Photographs
P bl t fi hb di P t h t Problem trees, fishbone diagrams, Pareto charts
 Value stream maps, process maps
 Representations of the people involved Representations of the people involved
 Anything that communicates information more quickly
and effectively than words
© 2011 Karen Martin & Associates 53
© 2011 Karen Martin & Associates 54
Thursday – Part II – Do, Check, Act
Theme: Owner:
Plan Do, Check, Act
Theme: ________________________________ ________________________________
Background Countermeasures / Implementation Plan
Current Condition
Effect Confirmation
Target Condition / Measurable Objectives
Follow-up Actions
Root Cause & Gap Analysis
In Summary
A3 reports should become a standardized formA3 reports should become a standardized form
of currency for problem-solving, dialogue, and
decision making in your organization creatingdecision-making in your organization– creating
an organization of “scientists” who continually
i ti d hi lt th himprove operations and achieve results through
constant learning from the work at hand.
© 2011 Karen Martin & Associates 56
For Further Study
For Further Questions
7770 Regents Road #635
San Diego, CA 92122
858 677 6799858.677.6799
ksm@ksmartin.com
Free monthl ne sletterFree monthly newsletter:
www.ksmartin.com/subscribe
Learn / Connect :
58

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A3 Management - From Structured Problem-Solving to Workplace Development (Part 1 of 2)

  • 1. A3 Management: From Structured Problem-Solving to Workforceg Development Part I 0f II Company LOGO
  • 2. Why is problem-solving so challenging? It takes a different kindIt takes a different kind of thinking to solve a problem than the kind of thinking that producedof thinking that produced the problem. -- Albert Einstein © 2011 Karen Martin & Associates 2
  • 3. Deming’s PDCA Cycle Plan Develop hypothesis & design experiment DoAct Conduct experiment Analyze results & take DoAct experimenttake appropriate action © 2011 Karen Martin & Associates Check Measure results
  • 4. What is A3? The core of Toyota’s renowned management systemsystem. A structured method for applying the PDCA (plan-do-check-act) approach to problem-(plan do check act) approach to problem solving. International designation for 11 x 17” paper. © 2011 Karen Martin & Associates 4
  • 6. Sample A3 Report Plan Do, Check, Act 6
  • 7. The A3 Report  A concise “story board” that reflects the problem solver’s discoveries and thought process along the waydiscoveries and thought process along the way.  Limited “real estate” develops precise thinking.  A “living document” that reflects the iterative nature of problem solving and enables organizational learningproblem-solving and enables organizational learning.  Highly visual – graphics, charts, maps, drawings, etc.  “Making it pretty” isn’t the goal – hand drawn A3s are OK Making it pretty isn t the goal hand drawn A3s are OK.  Neither the format nor the specific sections are set in stone.  Beware of using “templates.”  Serve the iterative nature of the problem-solving process. © 2011 Karen Martin & Associates 7
  • 8. The A3 Report Should Reflect the Process © 2011 Karen Martin & Associates 8 George Koenigsaecker, Leading the Lean Enterprise Transformation.
  • 9. Benefits of the A3  Creates consistency in how the organization goes about solvingg g g problems.  Builds problem-solving capabilities across the entire organi ationacross the entire organization.  Trains everyone how to drill complex problems down to their most essential l telements.  Forces a holistic/comprehensive view of the problem and solutions; requiresp ; q collaborative problem-solving.  Reduction in “silo-ism”  Th h t l d © 2011 Karen Martin & Associates  Thorough root cause analyses reduce the risk of “band-aid” solutions. 9
  • 10. Benefits of the A3 (continued)  Ownership role drives accountability and reduces risk of “it’s everything else’s problem ”it s everything else s problem.  Stimulates data-driven decisions.  Fairness and accountability replace blame and deceit. Fairness and accountability replace blame and deceit.  Transparency re: problems spawns a commitment to action.  Develops deep organizational capabilities. © 2011 Karen Martin & Associates 10
  • 11. Problem-Solving Steps 1. Identify the problem 2 E l th bl d l Plan 2. Explore the problem deeply  What’s the true root cause? 3 Consider potential solutions At least 50% of th t t l 3. Consider potential solutions  Hypothesize 4. Test solutions the total time 4. Test solutions  Confirm hypothesis 5. Implement solution(s)Do 6. Measure results  Did the hypothesis prove out?Check A © 2011 Karen Martin & Associates 7. Adjust as needed; prepare to improve again 11 Act
  • 12. Common Components of the A3 Report Theme: Owner: Plan Do, Check, Act Theme: ________________________________ ________________________________ Background Countermeasures / Implementation Plan Current Condition Effect Confirmation Target Condition / Measurable Objectives Follow-up Actions Root Cause & Gap Analysis
  • 13. A3 Roles & Responsibilities Problem owner  Individual who’s accountable both for the results and the process for achieving results.achieving results.  Problem owners have the authority to engage anyone needed and the ibilit t ll l tresponsibility to engage all relevant parties. CoachCoach  Person teaching the owner the problem- solving process. © 2011 Karen Martin & Associates  Typically the owner’s direct supervisor. 13
  • 14. Common Components of the A3 Report Theme: Owner: Plan Do, Check, Act Theme: ________________________________ ________________________________ Background Countermeasures / Implementation Plan Current Condition Effect Confirmation Target Condition / Measurable Objectives Follow-up Actions Root Cause & Gap Analysis
  • 15. Common Components of the A3 Report Theme: Owner: Plan Do, Check, Act Theme: ________________________________ ________________________________ Background Countermeasures / Implementation Plan Current Condition Effect Confirmation Target Condition / Measurable Objectives Follow-up Actions Root Cause & Gap Analysis
  • 16. Coach / Mentor’s Role Assure problem is relevant to the organization’s annual business goals.  Focus resource use on the relevant few rather than the trivial many problems. © 2011 Karen Martin & Associates 16
  • 17. The A3 Process: Define the Theme What is our area of focus? Articulating the right theme will force you to focus on the right problem. Should be closely aligned with organizational goals to avoid spending limited time and resources on trivial issuesresources on trivial issues. Avoid judging, concluding re: cause, or offering solutionssolutions.  E.g.: Flawed order entry process vs. Streamline order entry process © 2011 Karen Martin & Associates y p 17
  • 18. Common Components of the A3 Report Theme: “What is our area of focus?” Owner: Person accountable for results. Plan Do, Check, Act Theme: What is our area of focus? Owner: Person accountable for results. Background Countermeasures / Implementation Plan • What? • Who? • Problem statement • Context - why is this a problem? (visual) Current Condition Who? • When? • Where? (if relevant) Di f t it ti Context why is this a problem? (visual) Effect Confirmation • Diagram of current situation or process • What about it is not ideal? • Extent of the problem (metrics) • What measurable results did the solution Target Condition / Measurable Objectives • Diagram of desired state • Measurable targets – how will we know that achieve (or will be measured to verify effectiveness)? • Who’s responsible for ongoing measurement? Follow-up Actions g the improvement has been successful? Root Cause & Gap Analysis • Where else in the organization can this l ti b li d?• Graphical depiction of the most likely direct (root) causes solution be applied? • How will the improved state be standardized and communicated?
  • 19. The A3 Process: Background Include a problem statement  State the problem; do not offer a solution State the problem; do not offer a solution Background – information for understanding the importance and extent of the problem. H d th bl l t t l ? How does the problem relate to company goals?  How was the problem discovered? How long has it been a problem? ’ ? What evidence demonstrates that there’s a problem?  What degree of variation exists currently compared to a previous state? Tailor information for the audience. Present information visually. “S ll” th d f i t t f © 2011 Karen Martin & Associates “Sell” the need for improvement; create a sense of urgency. 19
  • 20. Sample Background Material sss Gray – highest industry quality scores P l i d t lit (b h k) FY 2008 FY 2009 FY 2010 Purple – average industry quality scores (benchmark) Blue – client quality scores 20
  • 22. Coach / Mentor’s Role Ask probing questions to assure proper background has been obtained and depicted as concisely as possible.  Aiming for emotional impact – why is this a problem? Don’t tell the problem owner what to include! Teach visual display options is owner is unfamiliar with them.u a a t t e © 2009 Karen Martin & Associates 22
  • 23. Potential Development Need Become proficient in visual data display options:  Bar charts  Histograms  Trend / line charts  Pie charts  Pareto charts  Etc. © 2009 Karen Martin & Associates 23
  • 24. Common Components of the A3 Report Theme: “What is our area of focus?” Owner: Person accountable for results. Plan Do, Check, Act Theme: What is our area of focus? Owner: Person accountable for results. Background Countermeasures / Implementation Plan • What? • Who? • Problem statement • Context - why is this a problem? Current Condition Who? • When? • Where? (if relevant) Di f t it ti Context why is this a problem? Effect Confirmation • Diagram of current situation or process • What about it is not ideal? • Extent of the problem (metrics) • What measurable results did the solution Target Condition / Measurable Objectives • Diagram of desired state • Measurable targets – how will we know that achieve (or will be measured to verify effectiveness)? • Who’s responsible for ongoing measurement? Follow-up Actions g the improvement has been successful? Root Cause & Gap Analysis • Where else in the organization can this l ti b li d?• Graphical depiction of the most likely direct (root) causes solution be applied? • How will the improved state be standardized and communicated?
  • 25. The A3 Process: Current Condition Two primary goals P id th di ith i f th t Provide the audience with an overview of the current process.  Demonstrate a fact-based understanding of the problem. Content  Provide a visual overview of the current state process or system (strong use of charts maps graphs tablessystem (strong use of charts, maps, graphs, tables, photos, etc.).  Highlight key factors in the current state.  Provide evidence of the problem (data)  Avoid qualitative opinions.  Avoid suggesting solutions or judging © 2011 Karen Martin & Associates  Avoid suggesting solutions or judging. 25
  • 26. Common Components of the A3 Report Theme: “What is our area of focus?” Owner: Person accountable for results. Plan Do, Check, Act Theme: What is our area of focus? Owner: Person accountable for results. Background Countermeasures / Implementation Plan • What? • Who? • Problem statement • Context - why is this a problem? Current & Target Conditions Who? • When? • Where? (if relevant) I l d d t t i t bl Context why is this a problem? Effect Confirmation • Include pre- and post metrics table • What measurable results did the solution Metric Current State Desired Target Condition Projected % Improvement Lead Time Quality Labor Effort achieve (or will be measured to verify effectiveness)? • Who’s responsible for ongoing measurement? Labor Effort Morale/Turnover Inventory Turns Market Share Follow-up Actions Root Cause & Gap Analysis • Where else in the organization can this l ti b li d? Returned Parts • Graphical depiction of the most likely direct (root) causes solution be applied? • How will the improved state be standardized and communicated?
  • 27. Coach / Mentor’s Role Ask probing questions to assure relevant metrics have been selected.  3-5 key performance indicators  How will we know if we’d been successful? © 2011 Karen Martin & Associates 27
  • 28. Current State Documentation Options  Go to the gemba! – OBSERVE  P f / dit d t Performance / audit data  Mapping  Value Stream Maps (VSM) - strategic Value Stream Maps (VSM) strategic  Metrics-Based Process Mapping (MBPM) – tactical  Spaghetti diagrams  Documentation / job aid review  Videotape / photos  W k i t i Worker interviews  Work samples  Etc © 2011 Karen Martin & Associates  Etc. 28
  • 29. Sample A3s – Current State Poor correspondencep quality Missing inventory resulting inresulting in write-offs
  • 30. Common Components of the A3 Report Theme: “What is our area of focus?” Owner: Person accountable for results. Plan Do, Check, Act Theme: What is our area of focus? Owner: Person accountable for results. Background Countermeasures / Implementation Plan • What? • Who? • Problem statement • Context - why is this a problem? Current Condition Who? • When? • Where? (if relevant) Di f t it ti Context why is this a problem? Effect Confirmation • Diagram of current situation or process • What about it is not ideal? • Extent of the problem (metrics) • What measurable results did the solution Target Condition / Measurable Objectives • Diagram of desired state • Measurable targets – how will we know that achieve (or will be measured to verify effectiveness)? • Who’s responsible for ongoing measurement? Follow-up Actions g the improvement has been successful? Root Cause & Gap Analysis • Where else in the organization can this l ti b li d?• Graphical depiction of the most likely direct (root) causes solution be applied? • How will the improved state be standardized and communicated?
  • 31. The A3 Report: Targets / Measurable Objectives Purpose  How will we know that the improvement has been successful?  What standard or basis of comparison will be used? What standard or basis of comparison will be used? Pointers  Use measurable objectives when possible Use measurable objectives when possible.  Consider how data will be collected and shared to evaluate the effectiveness of the implemented solution(s).  Begin planning for the Effect Confirmation section, but don’t focus on it yet. © 2011 Karen Martin & Associates y 31
  • 32. Target Condition vs. Effect Confirmation When setting target metrics, begin thinking how you’ll confirm performance (effect confirmation section).  Who? How frequently? How? © 2011 Karen Martin & Associates 32
  • 33. Coach / Mentor’s Role Ask probing questions to assure target condition meets business needs. It’s better to set stretch objectives and notj quite reach them than set objectives that you’re sure you’ll hit.y y © 2011 Karen Martin & Associates 33
  • 34. Common Components of the A3 Report Theme: “What is our area of focus?” Owner: Person accountable for results. Plan Do, Check, Act Theme: What is our area of focus? Owner: Person accountable for results. Background Countermeasures / Implementation Plan • What? • Who? • Problem statement • Context - why is this a problem? Current Condition Who? • When? • Where? (if relevant) Di f t it ti Context why is this a problem? Effect Confirmation • Diagram of current situation or process • What about it is not ideal? • Extent of the problem (metrics) • What measurable results did the solution Target Condition / Measurable Objectives • Diagram of desired state • Measurable targets – how will we know that achieve (or will be measured to verify effectiveness)? • Who’s responsible for ongoing measurement? Follow-up Actions g the improvement has been successful? Root Cause & Gap Analysis • Where else in the organization can this l ti b li d?• Graphical depiction of the most likely direct (root) causes solution be applied? • How will the improved state be standardized and communicated?
  • 35. The A3 Report: Root Cause Analysis Show the root cause of the problem(s) identified i th t t tin the current state. Separate symptoms and opinions from cause- d ff t d t i tiand-effect determination. Consider which techniques will be most useful in gaining root cause insightgaining root cause insight. Identify additional tests, if needed, to establish level of certainty re: cause and effectlevel of certainty re: cause and effect. Summarize your findings visually. © 2011 Karen Martin & Associates 35
  • 36. Root Cause Analysis © 2011 Karen Martin & Associates 36
  • 37. Root Cause Analysis (RCA) RCA is necessary to:  Avoid jumping to conclusions.  Avoid creating “band-aid” fixes (addressing only the symptoms)(addressing only the symptoms).  Select proper countermeasures.  Design and implement lasting Design and implement lasting solutions that truly eliminate the problem. © 2011 Karen Martin & Associates 37
  • 38. Root Cause Analysis Tools Simple problems  Five Why’s  Problem Analysis Tree More complex problems  Brainstorm causes (fishbone) If Brainstorm causes (fishbone)  Tally frequency of most likely causes (check sheet) If necessary ( )  Identify relevant few (Pareto analysis) for countermeasure development © 2011 Karen Martin & Associates p 38
  • 39. Five Why’s Example Problem: Report is taking too much of an employee’s time; 1. Why is the error report being prepared? Problem: Report is taking too much of an employee s time; team questions whether the report is needed 1. Why is the error report being prepared?  My supervisor told me to. 2. Supervisor – Why are you asking for this report? One of the standard reports to be prepared per my One of the standard reports to be prepared per my predecessor – I have yet to determine its usage. 3. Predecessor – Why did you initiate this report?  Report was required in the past because personnel in order entry were making data input errors. 4. Data entry – Why were orders being input with errors?  Orders received via fax were blurry and hard to read. 5. Data entry - Why were the fax orders hard to read?  Fax machine was old and of low quality. It was replacedq y p 10 months ago and errors no longer are occurring.
  • 40. Problem Analysis Tree Problem: Documents are not being translated well and on time Lost docs* In physical transit In cyberspace In in-basket No tracking Large batches Late or poorly In out-basket Poor original Confusing formats Faxed / poor resolution Late or poorly translated documents Translation Translator doesn’t understand original original Translator skills Random vocabulary Selection problems** Translator understands original, but still poor translation skills Wrong technical vocabulary Lack of training No standard Training poor translation vocabulary Poorly expressed No standard Unclear expectations Poor editing * Lost and found = 40%; lost & never found = 5%; stuck in system = 55% ** Rework on over 50% of documents p Uneven workload
  • 41. Cause-and-Effect Diagram (aka Fishbone, Ishikawa) Brainstorming tool used to identify most likely causes for an undesirable effectcauses for an undesirable effect Explores potential causes in 6 categories (6 M’s):  People (“Man”) People ( Man )  Material/Information - Inputs used in the process  Method - Procedures, work instructions, processes  Machine - Equipment, computers, tools, supplies  Measurement - Techniques used for assessing the quality/quantity of work, including inspectionq y q y , g p  Environment (“Mother Nature”) - External & internal Use other categories if appropriate © 2011 Karen Martin & Associates 41
  • 42. Cause-and-Effect Diagram (continued) Effective brainstorming tool  Forces teams to consider all possible causes Decreases the likelihood that something is being l k doverlooked Shows us the possible causes, but not how much each contributes if at all to the problemmuch each contributes, if at all, to the problem Does not provide solutions / countermeasures © 2011 Karen Martin & Associates 42
  • 43. Cause-and-Effect Diagram People Material / Info Method Lack of experience No stnd spread sheet Changing scheduleLack of experience Time availability No sense of import No stnd spread sheet No standard work Input rec’d late Changing schedule Budgets Submitted Late Email vs. FedEx Forecast in other system Manual vs. PC No milestones Weather delays M hi M t E i t System avail. $ vs. units y Dispersed sales force Machine Measurement Environment
  • 44. Techs Moving Product Skill Set Man Man Power Flexing Between Families Schedule MachineMethods Batching Blue affect productivity Yellow Most affect TAT Estimates Sap Data Entry Shared Equipment FIFO for Repair Units Cherry Picking Troubleshooting Variation in complexity Data Collection GMP R Complaints Sent to W.R. Testing Guidelines Tech Documentation Ease of Use Flex Schedule/Breaks Repair TAT Reason Low Backlog Planning No Std Repair Productivity Non Standard Bench Set Up Bag Refill Process Labor Time Collection Demand Variation Bag Refill Process Component Parts Feed Back Frequency Shipping By product Line MaterialsMeasures Incorrect Dates Recorded Environment
  • 45. Check Sheets Helps collect and record process data in an i d ?organized way?  How often are various events occurring? P id f t b t t d i d tProvides facts about a process to drive data- based conclusions. Include the “likely candidates” from the CauseInclude the likely candidates from the Cause- and-Effect diagram. Basis for Pareto analysisBasis for Pareto analysis. Note: Data collection must be easy and time- limited or it won’t happen © 2011 Karen Martin & Associates limited or it won t happen. 45
  • 46. Root Cause Analysis: Late Shipments Check Sheets Quantify Occurrences Reason TallyReason Tally Material shortage ||||| || Quality issue requiring |||||Quality issue requiring rework ||||| Staffing/absenteeism |||||| Order entry error ||||| ||||| Changing customer ||||| ||||| ||| requirements w/ no adjustment to expected delivery ||||| ||||| ||| © 2011 Karen Martin & Associates Equipment failure | 46
  • 47. Pareto Analysis Named after Wilfredo Pareto (18th century Italian economist/statistician) who discovered the 80 20economist/statistician) who discovered the 80-20 principle.  20% of the people held 80% of the wealthp p Focuses our attention on the VITAL FEW issues that have the greatest impact to avoid spending th TRIVIAL MANYenergy on the TRIVIAL MANY. A type of bar graph that displays information/data in order of significanceinformation/data in order of significance. A visual aid for defining & prioritizing problems. © 2011 Karen Martin & Associates 47
  • 48. Pareto Chart Credit Application Delayspp y 2909 86% 100% 97% 94% 3000 3500 90% 100% 2493 77% 86% 2500 nces 60% 70% 80% 41%1500 2000 Occurren 40% 50% 60% 627 561 1000 20% 30% 40% 561 242 180 0 500 0% 10% 20% No Signature Insufficient Bank Info No prior address Current Customer No Credit History Other Reason for Delay
  • 49. Coach / Mentor’s Role Teach root cause analysis tools if owner isn’t yet proficient. Ask probing questions to make sure truep g q root cause has been found. © 2011 Karen Martin & Associates 49
  • 50. Nailing the Plan phase of PDCA is the mostPDCA is the most important step in the entire problem-solving process. © 2011 Karen Martin & Associates 50
  • 51. Planning Reminders Background  Need to quantify the problem to reduce subjective / emotional responses  Financial Financial  Labor effort (which can be monetized)  Lead time / responsiveness (which can be monetized)  Market share  Compliance-related Compliance-related  Problem definition – proper scoping is vital!  Include a precise problem statement in © 2011 Karen Martin & Associates p p background section. 51
  • 52. Planning Reminders (continued) Target Condition / Desired state Li t t t d f t i t th l ti ! List targeted performance metric, not the solution!  Must include measurable objectives  Include both % improvement and the raw numbers (fromInclude both % improvement and the raw numbers (from what to what) Root cause  You cannot solve a problem without knowing it’s root cause!  Avoid making assumptions “Do you think or do you Avoid making assumptions - Do you think or do you know?”  When multiple root causes exist, quantify and select © 2011 Karen Martin & Associates the relevant few for countermeasure development. 52
  • 53. Plannning Reminders (continued) Displaying information visually aids tremendously in the absorption rate of thetremendously in the absorption rate of the information  Pie charts, trend charts, graphs, bar diagrams, , g p , g  Drawings  Photographs P bl t fi hb di P t h t Problem trees, fishbone diagrams, Pareto charts  Value stream maps, process maps  Representations of the people involved Representations of the people involved  Anything that communicates information more quickly and effectively than words © 2011 Karen Martin & Associates 53
  • 54. © 2011 Karen Martin & Associates 54
  • 55. Thursday – Part II – Do, Check, Act Theme: Owner: Plan Do, Check, Act Theme: ________________________________ ________________________________ Background Countermeasures / Implementation Plan Current Condition Effect Confirmation Target Condition / Measurable Objectives Follow-up Actions Root Cause & Gap Analysis
  • 56. In Summary A3 reports should become a standardized formA3 reports should become a standardized form of currency for problem-solving, dialogue, and decision making in your organization creatingdecision-making in your organization– creating an organization of “scientists” who continually i ti d hi lt th himprove operations and achieve results through constant learning from the work at hand. © 2011 Karen Martin & Associates 56
  • 58. For Further Questions 7770 Regents Road #635 San Diego, CA 92122 858 677 6799858.677.6799 ksm@ksmartin.com Free monthl ne sletterFree monthly newsletter: www.ksmartin.com/subscribe Learn / Connect : 58