Principle 4 - To improve the outcome, improve the system (Item 2)

In order to improve the outcome; improve the system and its associated processes.

Corollary: All people work in a system: outcomes are improved when people work on improving the system

Why this question is important

You must set targets for improvement of your processes based on the needs of the customers of those processes.

Targets are important.

• They are uniting in that they give direction and focus, and so are very important for Principle 2 (`Focus on Achieving Results').
• You don't have to know how to achieve them when you set them – otherwise you will always be working in the world that you know and within which you are comfortable – and that is too restrictive these days.
• If you do not know how to reach them or if they are outside your process capability, you will need a plan of how to reach them.
• If you do not have such a plan, then all you are doing is wishing that you will reach your target.

SIPOC

SIPOC is a useful concept when thinking about systems and processes. It is an acronym for the chain Supplier-Input-Process-Output-Customers. That is, Suppliers make Input to your Processes which turn it into Output for your Customers.

SIPOC implies a chain of suppliers and customers – both customers of the process and end-customers. Some are within the company and some are external. Because of the chain, it can be difficult to know who the customers are. This confusion can paralyze understanding about customer needs. The rule is "Customers are the ones who define problems in the output". The one who needs the product or service defines the service and is the customer. We saw in Principle 3 (`Customers') that feedback from customers is an essential, constant and critical need. Customer feedback is the mother's milk of improvement. Improvement is the essence of survival. Customer complaints are "gifts".

Of course, all customers and suppliers in the chain are caught in the capabilities of their own systems. If you understand your customers' systems, and the needs and difficulties of your customers' customers, you may be able to provide better service.

In this systems view, all work is an interdependent series of factors and events that produce some output (e.g., products and services) that serve some purpose (e.g. needs of customers). If there are problems with the output, it is because there are problems in the system.

Internal Customers

We now turn to the way people are affected by and can assist in improving processes.

Everything we wrote about external customers in Principle 3 (`Customers') applies to the internal customers — with one exception. Internal customers are really caught with one supplier. Internal customers usually cannot go somewhere else in the company to get what they really need. These people are customers of the process. For example:

• A person in an assembly line who is receiving shoddy work from up the line cannot get that work from someone else. They have to work with that supplier.
• A person who required information from people in the company to do their work finds that it is consistently late and inaccurate. They have to work with those suppliers.
• A person constantly finds that their boss does not keep them informed enough of what is going on to be able to do their job - the boss withholds information (or authority) when delegating. The person has to work with that supplier.

All these examples show a `captured customer'. The solution is to enable those internal customers to say to their suppliers "what you supply to me is not satisfactory". That can be a huge thinking shift. Very few businesses have begun to make the shift.

Gemba

Gemba is a very useful concept in our understanding of internal customers. `Gemba' is Japanese and means "the place where actual work is being done"; there is no equivalent in English. It is often translated as `shop floor' but that misses the point somewhat.

Gemba work is provided directly to the customers. Not everyone works in the gemba. Only those who are part of the value-adding/value-creating flow as it heads towards the customer are part of the gemba.

Your company is made up of many systems and work flows. Not all of them are gemba. Only those systems that relate directly to a flow of work that adds value to the customer is gemba.

This means that there are two different systems: the gemba and those who support the gemba. The gemba measures its success in how well it serves customers. The non-gemba measures success in how well it serves the gemba.

So, why is this concept important? The intent is not to establish yet another new hierarchy of importance among people, a new internal pecking order. The purpose is to help identify system functions. Consider these:

Very few managers are gemba, yet every decision they make is felt in the gemba

Everything is felt in the gemba. Every policy change, plan, decision or process change. Often the gemba will not know why or who changed something. They will just see that something that did work will no longer work.

It is extremely important that the gemba has say in decisions that affect them.

Do not keep the gemba waiting, do not disrupt the flow of the gemba. You will see later the importance of managing bottlenecks. The gemba usually has its hands on the bottlenecks.

Very few of the people in your company are actually doing gemba work. Most people are engaged in work that supports the gemba. The ratio of gemba to non-gemba might be an important performance measurement for you. Many companies find they have about five non-gemba for each gemba. However, the ratio you have now (by Principle 4) is exactly the number you need to produce your current output. Your processes are designed to need exactly the level of support you have. If you want to change the ratio, you have to change the processes. A useful way of removing bottlenecks from the gemba is to have non-gemba people do those bits of the gemba's work that is really non-gemba, e.g. paper work.

Training should improve the way the gemba works. However, training will also disrupt the gemba and so must be implemented in a way that minimizes that disruption.

The more you can enable the gemba the better – provide it with skills, knowledge, power and authority to make decisions.

Do not have gemba people doing things just for the sake of doing things.

Almost all non-gemba people work with information.

Many companies have made significant advancements by just considering the work the gemba is doing and freeing up the gemba as much as possible from non-essential work.

Improve your support processes

Now a significant thing happens. Although non-gemba usually far outnumber the gemba, and everything the non-gemba do is felt in the gemba, most companies spend their process improvement efforts on the gemba. You can usually make considerable easy gains by improving the non-gemba.

Because they are not directly involved product and service delivery, support processes are not usually designed in the same detail as product and service delivery processes. You should design and operate your support processes so that also they provide value to your customers (in line with Principle 3 `Customers') and support your Goals and objectives.

Management and improvement of non-gemba support services should proceed in a similar manner to that for gemba processes, and include evaluation, in-process measurements and satisfaction of internal customers with the services provided. Support process design should be coordinated and integrated to ensure efficient and effective linkage between non-gemba and gemba processes.