Velocity: Combining Lean, Six Sigma and the Theory of Constraints to Achieve Breakthrough Performance - A Business Novel (英語) ハードカバー – 2009/12/29
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Millions of readers remember The Goal, the landmark business novel that sets forth by way of story the essential principles of Eliyahu Goldratt's innovative methods of production. Now, from the AGI-Goldratt Institute and Jeff Cox, the same creative writer who co-authored The Goal, comes VELOCITY, the book that reveals how to achieve outstanding bottom-line results by integrating the world's three most powerful continuous improvement disciplines: Lean, Six Sigma, and Goldratt's Theory of Constraints.
Used by the United States Navy and United States Marine Corps to dramatically improve some of the most complex, logistically vast supply chains in the world, the VELOCITY APPROACH draws on the strengths of all three disciplines to deliver breakthrough performance gains. In physics, speed with direction is velocity; in business, the application of VELOCITY means your organization can achieve operational speed with strategic direction to outmaneuver competitors, gain loyalty with customers, and rapidly build sustainable earnings growth -- in as little as one or two business quarters.
Dee Jacob and Suzan Bergland, two princi-pals of AGI, have been teaching the concepts, techniques, and tools of VELOCITY to major corporations, including Procter & Gamble, ITT, and Northrop Grumman, for years. Now they unlock the door for you to see how to apply their insights and methods to your organization -- be it business, not-for-profit, manufacturing, or service based -- in order to shorten lead times, slash inventories, reduce production variability, and increase sales.
Writer Jeff Cox returns with the vivid, realistic style that made The Goal so readable yet so edifying. Thrust into the presidency of the subsidiary company where she has managed sales and marketing, Amy Cieolara is mandated by her corporate superiors to implement Lean Six Sigma (LSS) in order to appease a key customer. Assigned to help her is LSS Master Black Belt Wayne Reese, installed as her operations manager. But as time goes on and corporate pressure mounts, Amy finds she has to start thinking for herself -- and learning from everyone around her -- and she arrives at the series of steps that form the core of the VELOCITY APPROACH.
VELOCITY offers keen insight into the human and organizational factors that so often derail growth while teaching you proven, practical techniques for restarting and revving up the internal engines of your company to reach new levels of success. Colorful characters, believable situations, and everything from dice games to AGI's "reality tree" techniques make this business novel a vital resource for everyone seeking to deliver business improvement in these challenging economic times -- and far into the future.
"AGI's VELOCITY APPROACH enabled us to get control over the uncertainties of our repair and remanufacturing business, leading to significant improvements in our overall performance. The changes we made to the way we manage our business positioned us to not only survive but to thrive in what could be called the worst recession since the Great Depression." -- Carl Coslow, President, Republic Industries International
"As we transformed the entire Naval Aviation logistics system, our leadership team decided that 'AIRSpeed,' our continuous process improvement program, would combine best business practices -- Lean, Six Sigma, and Theory of Constraints. This strategy not only enabled Naval Aviation to reduce turnaround times 40 percent and work in process nearly 50 percent in areas applied, but enhanced the quality of life of our sailors and marines." -- VADM Walter B. Massenburg, USN (Ret.), former Commander, Naval Air Systems Command; Architect and Chief Operating Officer of Naval Aviation Enterprise
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The story was a touch dry, but I still found it interested and wanted to see what the ultimate solution would be for the company Hi-T. The main character Amy is likeable and you end up rooting for her. They of course introduce another character similar to Jonah from The Goal who provides clear thought (in this book Tom Dawson). The other managers are split on how they want to fix the problems and embracing the change that is needed.
The book takes you through at a high level some of these disciplines:
Lean - Creating value for customers by way of products and services with minimum waste at optimal speed in perfect balance with market demand.
Six Sigma - Identifying and eliminating defects, errors, and anything quantifiable that is unwanted by customers.
Value Stream - Laying out the stages of a process or a project. Diagramming the flow and the various branches of input.
Takt Time - Time available to work divided by demand - the time available to make the product divided by the units needed.
Theory of Constraints - Holds that every system - business system or manufacturing system - is made up of resources that each have varying limits. Performance of the total system is constrained by whatever resource is most limited or the bottleneck of the system.
While other concepts are discussed in various detail the book explains throughput well. This is the rate at which inventory is converted into completed sales, or cash. This is the language every company knows and needs to understand. This concept can be translated to service or manufacturing (and retail even).
Overall, I enjoyed reading about how this company fixed the problems they were having and embraced (reluctantly to start) some new ideas and some changes to how they have worked for years. Good read with a lot of takeaways about lead, six sigma and Theory of Constraints.
Rather than attack Lean Six Sigma, the authors instead have written a novel about the implementation of these tools into a business, speaking about the positive and the negative during the growth process. What the book makes clear is that it is not Lean Six Sigma that causes the problem, rather the attempt of a company to create a culture in which Lean Six Sigma is used in every corner of a business, essentially creating islands of excellence within various workgroups. Through reading, we understand that removing waste and variation within different areas of a company does not necessarily affect throughput in a positive way; we must concentrate our efforts where they are most needed, not arbitrarily to every facet of an organization.
Velocity makes it clear that a perfectly balanced system is not only rare, but also not necessarily in the best interest of throughput. Velocity teaches us the importance of having a constraint within a system, rather than the accepted idea of removing constraints. It also teaches us how to optimize the constraint while still maintaining it, to achieve the best possible flow through the process.
The authors have obviously been there and done it. They share knowledge in this book that can only be gained by experiencing implementation of Lean, Six Sigma and TOC and readers can save lots of time and money by adopting the advice within.
I thought that perhaps too much of the book spent time on the plagued LSS program but still gave it 5 stars considering the impact it can have on your business/career if you read it and act on it.
The people issues described and the practical solutions provided to these problems are insightful and worth considering when implementing initiatives.
*How reepeatable are the results of the dice game? How sound is the statistics behind it?
*How close is the game in resemblance to reality of a production line? What are the limitations? Under what conditions would the TOC approach (DBR) work better or worse?
*Under what conditions does a balanced line with takt time work better or worse than an unbalanced line? How to quantify the variability in order to determine which approach to use?
Here is a link that discuss more on these topics.
While the book follows the same business novel format as its predecessors, it gets lost in the personal/love story in a way that is far more distracting and contrived. The main message is still there, it's just entwined in a soap-opera tale, more so than the Goldratt books.
The combination of Lean, Six Sigma, and Theory of Constraints is not as clearly and convincingly depicted as TOC was in "The Goal," or "It's Not Luck." In the end, it almost seemed as if one or two systems would have been better to try to use all three simultaneously. While a little imagination could apply the other two books to nearly any industry, "Velocity" clearly belongs primarily to manufacturing and related fields.