Lean Webinar Series: A3 Management - Part I

Lean Webinar Series
A3 Management – Part I
December 6, 2011
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© 2011 Karen Martin & Associates, LLC 2

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Your Instructor
 Early career as a scientist; migrated to quality &

operations design in the mid-80’s.
 Launched Karen Martin & Associates in 1993.
 Provide business performance improvement and
Lean transformation support in office, service &
knowledge work environments.
 Co-author of The Kaizen Event Planner; co-
developer of Metrics-Based Process Mapping:
An Excel-Based Solution; author of forthcoming
The Outstanding Organization (McGraw-Hill, Karen Martin, Principal
Karen Martin & Associates, LLC
May 2012).
 Instructor in University of California, San Diego’s
Lean Enterprise program.
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Webinar Schedule
Content
 11:00 am -12:00 pm PT
Q&A
 12:00-12:30 pm PT
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2012 Webinars
Month Topic
January Strategy Deployment (Hoshin Kanri)
February A Factory of One – Dan Markovitz
March The Outstanding Organization: Achieving Clarity
April The Outstanding Organization: Achieving Focus
May The Outstanding Organization: Achieving Discipline
June The Outstanding Organization: Achieving Engagement
The Outstanding Organization

by Karen Martin
Book launch – May 18, 2012
8
Agenda
Part 1 - Tuesday, December 6

 A3 Overview
 “Plan” stage of PDSA
 Root cause analysis
Part 2 – Wednesday, December 7
 “Do-Study-Adjust” stages of PDSA
 How to accelerate building problem owners’ and coaches’
capabilities
 Common problem-solving pitfalls

For Further Study
Why is problem-solving so challenging?
It takes a different kind

of thinking to solve a
problem than the kind
of thinking that produced
the problem.
— Albert Einstein

What is A3?
The core of Toyota’s renowned management

system.
A structured method for applying the PDSA
(plan-do-study-adjust) approach to problem-
solving.
International designation for 11 x 17” paper.

The A3 Report
 A concise “story board” that reflects

the problem solver’s discoveries &
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 learning.
 Highly visual – graphics, charts,
maps, drawings, etc.
 “Making it pretty” isn’t the goal –
hand drawn A3s are OK.
 Neither the format nor the specific
sections are set in stone.
The A3 Report is a Communication,
Consensus-Building and Learning Tool
The A3 report is
a story board that
reflects the
problem-solving
process.
It is created as
you progress
through PDSA,
not after.
George Koenigsaecker, Leading the Lean Enterprise Transformation.
14
PDSA Cycle – The Scientific Method
Develop
Plan hypothesis &
design
experiment
Analyze
results &
adjust as
appropriate
Adjust Do Conduct
experiment
Measure
Study results
Problem-Solving Steps
{
Plan 1. Identify the problem
2. Explore the problem deeply
At least  What’s the true root cause?
50% of 3. Consider potential solutions
the total
time
 Hypothesize
4. Test solutions
 Confirm hypothesis
Do 5. Implement solution(s)
6. Measure results
Study  Did the hypothesis prove out?
Adjust 7. Adjust as needed; prepare
to improve again
Sample A3 Report
Plan Do, Study, Adjust
17
Benefits of the A3
 Creates consistency in how

organizations go about solving
problems, managing projects, and
making decisions.
 Builds critical thinking and problem-
solving capabilities across the entire
organization.
 Forces a holistic/comprehensive view
of the problem and solutions; requires
collaborative problem-solving.
 Reduction in “silo-ism”
 Thorough root cause analyses reduce
the risk of “band-aid” solutions.
Benefits of the A3 (continued)
 Ownership role drives accountability and reduces risk of

“it’s everything else’s problem.”
 Stimulates data-driven decisions.
 Fairness and accountability replace blame and deceit.
 Transparency re: problems spawns a commitment to
action.
 Develops deep organizational capabilities.

Common Components of the A3 Report
Theme: ________________________________ Owner: ________________________________
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.
 Problem owners have the authority to
engage anyone needed and the
responsibility to engage all relevant
parties.
Coach
 Person teaching the owner the problem-
solving process.
 Typically the owner’s direct supervisor.
Theme: ________________________________ Owner: ________________________________
Current Condition
Effect Confirmation
Follow-up Actions
Theme: ________________________________ Owner: ________________________________
Current Condition
Effect Confirmation
Follow-up Actions
Coach / Mentor’s Role
Assure problem is relevant to the

organization’s annual business goals.
 Focus resources on the highest priority
problems.

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 issues.
Avoid judging, concluding re: cause, or offering
solutions.
 E.g.: Flawed order entry process vs. Streamline order
entry process

Theme: “What is our area of focus?” Owner: Person accountable for results.

• Problem statement • What?
• Context - why is this a problem? (visual) • Who?
• When?
• Where? (if relevant)
Current Condition
• Diagram of current situation or process
• What about it is not ideal?
Effect Confirmation
• Extent of the problem (metrics)
• What measurable results did the solution
achieve (or will be measured to verify
Target Condition / Measurable Objectives effectiveness)?
• Diagram of desired state • Who’s responsible for ongoing
• Measurable targets – how will we know that measurement?
the improvement has been successful?
Follow-up Actions
Root Cause & Gap Analysis • Where else in the organization can this
• Graphical depiction of the most likely direct solution be applied?
(root) causes
• 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
Background – information for understanding the
importance and extent of the problem.
 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.
“Sell” the need for improvement; create a sense of
urgency.
Sample Background Material
sss
FY 2008 FY 2009 FY 2010
Gray – highest industry quality scores

Purple – average industry quality scores (benchmark)
Blue – client quality scores
28
Sample Background Material
0
0
29
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 if owner is
unfamiliar with them.
© 2009 Karen Martin & Associates 30

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 31


• Context - why is this a problem? • Who?
• When?
Current Condition
Effect Confirmation
Follow-up Actions
(root) causes
and communicated?
The A3 Process:
Current Condition
Two primary goals

 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, tables,
photos, etc.).
 Highlight key factors in the current state.
 Provide evidence of the problem (data)
 Avoid qualitative opinions.
 Avoid suggesting solutions or judging.


• When?
Current & Target Conditions
• Include pre- and post metrics table
Desired Target Projected %
Metric Current State
Condition Improvement
Lead Time Effect Confirmation

Quality
Labor Effort
Morale/Turnover
effectiveness)?
Inventory Turns
Market Share
• Who’s responsible for ongoing
measurement?
Returned Parts
Follow-up Actions
(root) causes
and communicated?
Ask probing questions to assure relevant

metrics have been selected.
 3-5 key performance indicators
 How will we know if we’d been successful?
35
© 2011 Karen Martin & Associates, LLC
Current State Documentation
Options
 Go to the gemba! – OBSERVE

 Performance / audit data
 Mapping
 Value Stream Maps (VSM) - strategic
 Metrics-Based Process Mapping (MBPM) – tactical
 Spaghetti diagrams
 Documentation / job aid review
 Videotape / photos
 Worker interviews
 Work samples
 Etc.

Sample A3s – Current State
Poor
correspondence
quality
Missing
inventory
resulting in
write-offs

• When?
Current Condition
Effect Confirmation
Follow-up Actions
(root) causes
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?
Pointers
 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.

Target Condition vs. Effect
Confirmation
When setting target metrics, begin thinking

how you’ll confirm performance (effect
confirmation section).
 Who? How frequently? How?

Ask probing questions to assure target

condition meets business needs.
It’s better to set stretch objectives and fall
a little short, than to set objectives that
you’re sure you’ll hit.
41

• When?
Current Condition
Effect Confirmation
Follow-up Actions
(root) causes
and communicated?
The A3 Report:
Root Cause Analysis
Show the root cause of the problem(s) identified

in the current state.
Separate symptoms and opinions from cause-
and-effect determination.
Consider which techniques will be most useful in
gaining root cause insight.
Identify additional tests, if needed, to establish
level of certainty re: cause and effect.
Summarize your findings visually.

Root Cause Analysis (RCA)
RCA is necessary to:

 Avoid jumping to
conclusions.
 Avoid creating “band-aid”
fixes (addressing only the
symptoms).
 Select proper
countermeasures.
 Design and implement
lasting solutions that truly
eliminate the problem.

Root Cause Analysis Tools
Simple problems
 Five Why’s
 Problem Analysis Tree
More complex problems
 Brainstorm causes (fishbone) If
necessary
 Tally frequency of most likely causes
(check sheet)
 Identify relevant few (Pareto analysis)
for countermeasure development

46
Teach root cause analysis tools if owner

isn’t yet proficient. (mentor)
Ask probing questions to make sure true
root cause has been found. (coach)
47
Nailing the Plan phase of
PDSA is the most
important step in the
entire problem-solving process.

Tomorrow – Part 2 – Do, Study, Adjust
Theme: ________________________________ Owner: ________________________________
Current Condition
Effect Confirmation
Follow-up Actions
In Summary
A3 reports should become a standardized form

of currency for problem-solving, dialogue, and
decision-making in your organization– creating
an organization of “scientists” who continually
improve operations and achieve results through
constant learning from the work at hand.
— John Shook, Managing to Learn

Your Questions
How long developing a tactical A3 take (3

levels of A3)?
Who should be involved in developing A3?
Please provide examples of healthcare
organizations where A3 has been used
successfully to achieve improvement.

For Further Questions
Karen Martin, Principal

7770 Regents Road #635
San Diego, CA 92122
858.677.6799
[email protected]
Connect, learn, and thought-share

Monthly newsletter: www.ksmartin.com/subscribe
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Lean Webinar Series

To new friends and old across the U.S.

© 2011 Karen Martin & Associates, LLC 2

© 2011 Karen Martin & Associates, LLC 4

1. Raise your hand – you

2. Type your question

© 2011 Karen Martin & Associates, LLC 5

 Early career as a scientist; migrated to quality &

Recorded webinars are available on our Vimeo site:

Materials are available on our SlideShare site:

To register for our newsletter to learn about future webinars:

© 2011 Karen Martin & Associates, LLC 7

The Outstanding Organization

Part 1 - Tuesday, December 6

© 2011 Karen Martin & Associates, LLC 9

It takes a different kind

© 2011 Karen Martin & Associates, LLC 11

The core of Toyota’s renowned management

© 2011 Karen Martin & Associates, LLC 12

 A concise “story board” that reflects

George Koenigsaecker, Leading the Lean Enterprise Transformation.

 Creates consistency in how

 Ownership role drives accountability and reduces risk of

© 2011 Karen Martin & Associates, LLC 19

Background Countermeasures / Implementation Plan

Target Condition / Measurable Objectives

Background Countermeasures / Implementation Plan

Target Condition / Measurable Objectives

Background Countermeasures / Implementation Plan

Target Condition / Measurable Objectives

Assure problem is relevant to the

© 2011 Karen Martin & Associates, LLC 24

What is our area of focus?

© 2011 Karen Martin & Associates, LLC 25

Background Countermeasures / Implementation Plan

FY 2008 FY 2009 FY 2010

Gray – highest industry quality scores

Ask probing questions to assure proper

© 2009 Karen Martin & Associates 30

Become proficient in visual data display

© 2009 Karen Martin & Associates 31

Background Countermeasures / Implementation Plan

Two primary goals

© 2011 Karen Martin & Associates, LLC 33

Background Countermeasures / Implementation Plan

Lead Time Effect Confirmation

Ask probing questions to assure relevant

 Go to the gemba! – OBSERVE

© 2011 Karen Martin & Associates, LLC 36

Background Countermeasures / Implementation Plan

© 2011 Karen Martin & Associates, LLC 39

When setting target metrics, begin thinking

© 2011 Karen Martin & Associates, LLC 40

Ask probing questions to assure target

Background Countermeasures / Implementation Plan

Show the root cause of the problem(s) identified

© 2011 Karen Martin & Associates, LLC 43

RCA is necessary to:

© 2011 Karen Martin & Associates, LLC 44