Lean Flight Initiative 4 Conference presentatio

Kenley, C. Robert

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LAI and Enterprise Excellence: Presented to Lean Flight Initiative 4 Four Seasons Hotel, Atlanta, Georgia, US  C. Robert Kenley, Ph.D. Massachusetts Institute of Technology May 11, 2011  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 2 Lean Flight Initiative, Atlanta, GA, May 11, 2011  Origin of LAI In 1992 US Air Force asked: Can the concepts, principles and practices of the Toyota Production System be applied to the military aircraft industry?  In 1990, an MIT Press book by Womack, Jones, and Roos on the automobile industry introduces Lean Production as a new industrial paradigm MIT wondered:   Does Lean apply to an industry with significantly different products and customers?   Will Lean principles and practices be extended beyond the Toyota Production System? U.S. AIR FORCE http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 3 Lean Flight Initiative, Atlanta, GA, May 11, 2011  First Major Publication by LAI on the Value Creation Framework * Source: Murman et al., Lean Enterprise Value, Palgrave 2002"“How various stakeholders find particular worth, utility, benefit, or reward in exchange for their respective contributions to the enterprise.”*!Value Identification Value Proposition Value Delivery Value Phases “Dynamic and Iterative” Identify the stakeholders and their value expectations Develop a robust value proposition to meet the expectations Deliver on the promise with good technical and program performance http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 4 Lean Flight Initiative, Atlanta, GA, May 11, 2011  The Current LAI Vision and Mission Emphasizes Enterprise Excellence Vision The Lean Advancement Initiative (LAI) at MIT enables enterprises to effectively, efficiently, and reliably create value in complex and rapidly changing environments.  Mission LAI enables the focused and accelerated transformation of complex enterprises through collaborative stakeholder engagement in developing and institutionalizing principles, processes, behaviors, and tools for enterprise excellence.  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 5 Lean Flight Initiative, Atlanta, GA, May 11, 2011  Is this your story? E. gave me a call this morning ….  They are currently going through a change to their management structure…. he DEFINITELY sees the value of doing an enterprise transformation ....  He talked about feeling like he is over a “holding company of 15 silos” (that’s his 15 departments).    When he was doing “local lean” as head of the ED, he would see an improvement, but then would notice that it would not be aligned with the rest of the enterprise.  Now as Interim President, he sees this problem “magnified.”   Conversation with a healthcare executive in May 2011  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 6 Lean Flight Initiative, Atlanta, GA, May 11, 2011  Enterprise Excellence Defined An enterprise is “a complex, integrated, and interdependent system of people, processes, and technology that creates value as determined by its key stakeholders.  An enterprise typically consists of multiple organizations (e.g., suppliers, partners, regulators) rather than a single corporation, division, or government unit.” An enterprise has achieved excellence when “it effectively, efficiently, and reliably creates sustained value as determined by its key stakeholders (including comparisons with relevant benchmarks) over time and changing circumstances.” Amacon Press –Release: Aug. 2011 http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 7 Lean Flight Initiative, Atlanta, GA, May 11, 2011  Enterprise Transformation Framework LESAT and  EA Framework Assessment of  Current State and  Design of  Future State ESAT Methodology for Developing Transformation Plan 7 Enterprise Principles http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 8 Lean Flight Initiative, Atlanta, GA, May 11, 2011  Source: D. Nightingale and J. Srinivasan, MIT 2010 6. Ensure  stability and flow within and across the enterprise. 5. Address  internal and external  enterprise interdependencies. 4. Focus  on enterprise effectiveness before efficiency. 3. Identify relevant stakeholders  and determine their value propositions.  2.  Secure leadership commitment to drive and institutionalize enterprise behaviors. 1. Adopt a  holistic approach  to enterprise transformation.  7 Principles of Lean Enterprise Transformation 7. Emphasize organizational learning. http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 9 Lean Flight Initiative, Atlanta, GA, May 11, 2011  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 10 Lean Flight Initiative, Atlanta, GA, May 11, 2011  PTSD: A Significant Pathology of War A Major Concern Being Addressed by LAI Resources:  RAND, 2008 Invisible Wounds of War •  Challenges with Access to and Quality of Care •  Challenges with Culture and Stigma •  Consideration of Families http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 11 Lean Flight Initiative, Atlanta, GA, May 11, 2011     Psychological Health is an  Enterprise Challenge “The current system is insufficient to meet the needs of today’s forces and their beneficiaries and will not be sufficient to meet the needs of the future.” -  DoD Task Force on  Mental Health,2007 “This isn’t just a debt of gratitude.  This is a debt that must be repaid because they have sacrificed so much. They have done exactly what this country has asked. They have fought and suffered and their lives have been affected forever.” 4-Star Speaks Out on Struggle with PTSD Admiral Michael Mullen, Chairman of the Joint Chiefs of Staff Army Times, 11-26-2008 http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 12 Lean Flight Initiative, Atlanta, GA, May 11, 2011  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 13 Lean Flight Initiative, Atlanta, GA, May 11, 2011  Engage Senior Leadership Admiral Mike Mullen, Chairman of the Joint Chiefs of Staff General Peter Chiarelli, Vice-Chief of U.S. Army and  VADM Adam Robinson, Army Surgeon General ARMY  Admiral Jonathan Greenert, Vice-Chief of Naval Operations and  VADM Adam Robinson, Navy Surgeon General NAVY Dr. James B. Peake, Lt. Gen.(ret), Former Secretary of Veterans Affairs and Honorable Togo West, Former Secretary of the Army   General Howie Chandler, Vice Chief of U.S. Air Force and LT. General Bruce Green, Air Force Surgeon General AIR FORCE General James Amos, Assistant Commandant of the Marine Corps MARINE CORPS ADVISORS http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 14 Lean Flight Initiative, Atlanta, GA, May 11, 2011  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 15 Lean Flight Initiative, Atlanta, GA, May 11, 2011  Stakeholder: Supplier High Current Performance Low Low High Relative Importance Fair and Equitable Treatment Reasonable ROI Timely Payment Long Term Relationships Joint Forecasting Early/Accurate Req. ID http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 16 Lean Flight Initiative, Atlanta, GA, May 11, 2011   16	  Approved RegulationsDevelop Acquire Field Sustain Dispose OtherHQDA Staff/SecretariatASAALTAMCATECIndustryDRUs/CommandsWarfighter TRADOCConduct developmental test in support of EMDConduct operational tests to support milestone decisions prior to LRIP and/or full mte production.Conduct safety/efficiency/ sustainability assessments for rapid acquisitionPerform R&D ProposeProduceTestEstablishPolicyStrategic DirectionProgram ResourcesSet PrioritiesAllocate Resources & PeopleExternal Interface: OSD/Congress/ STRATCOMProvide Technical ExpertiseProvide sparesProvide Log SupportMaintain Critical AssetsForeign GovtRequestsState Dept / Admin PolicyCoordinates International agree. FMSConduct ASTWGASTAGManage Acq. WorkforceConduct Resourcing STRATCOMCong. Rel.Manage ContractingDevelop TechnologyLead: RDECOMSupport: PMsContract CmdTRADOCIndustryAcedemiaATECDevelop ProgramsProvide Reqs. Thru accelerated capabilities Dev.Provide reqs. Thru deliberate capabilities dev.Provide forces for experimentationConduct StudiesManage ProgramLead: Acq Map PEOQuick Reaction CapabilitiesLead: RDECOMRefine Reqs. for accelerated capabilities Dev.Refine reqs. For deliberate capabilities dev.Provide forces for testingField major programsLead: Field / PEOPerform capabilities integration (request net)Perform RESET (request Log support)Conduct Rapid Acq.Conduct ASARC DABS1Army StaffS3Internal AMC AnalysisOversee ExecutionS1MSCsS1HQDAD1SubordCmdsD1HQDAD1MSCsJ&AsAcq. StrategyAcq PlanContracting ApproachWarfighter outcomes proposed HTOs w/PEO, TRADOC EndorsementReview/ Approve Reqs.Oversight / adjustmentsCapture leadership intent•Standardize Practices•Statues•Cong. Language•Admin. GuidanceSSecDef Guidance for Dev. Of Force (GDF)OSD Prog GuidanceCDR’s NarrativeADM Develop Policy•APPG•APGM •ACP•POM•Budget•TAA Force LevelDArmy S&TMaster PlanDApproved J&AsDONS Director RequirementFielded EquipmentD•Temp•Supp Stat•TDS•Tech read . A•Acq Strat•APB•ICE Develop TempADMDLOAsMOUsTreatiesMOAsIntl Data Exch.DNew HiresRe-HiresTrained Cert. WorkforceD •TRADOC (future Needs)•RDECOM & Other Perf. (Opport..)•ASA(ALT) & DDR&E (framework & PrioritiesBasic Research Strat.•RDECOM & Other Perf. (incl. Acedemia)•DDR&E•CongressDProvision of Appropriated resources:Determine Reqs.  of Appropriated resources:S2HHQ Policy Sch.S1MSCsDevelop & Build InfrastructureS1Army StaffD1Army StaffD1MSCsPM & Other Customers(eg. REF, JIEDDO, RDECOM)PM & MDA or other CustomersTRADOC PMFORSCOM PM/DAMDS & DOT&ECongressPM / JIEDDOREF / RDECOMG3 / COCOMIndustryPM / JIEDDOREF / RDECOMG3 / COCOMIndustryExecute DT / OT for system model upgradesTRADOC PMFORSCOM PM/DAPM & Milestone Decision Authority (MDA)Conduct in-service assessmentsPM / Other CustomersG3G3 / TRADOCPM or other customersDeliver Materials and Service SupportPerform Sustainment (readiness as metric)Lead: LCMCRequest Logistics Support for UnitsConduct ASARC DABTreaty GuidanceChem Inventory Execute Chem DemilInventory EliminationProvide Disposal & DestructionPerform Reuse and RecoveryIdentify Items for DisposalSustain / Upgrade test infrastructurePMTest Ranges& Other customers(REF, JIEDDO, other servicesTest Ranges / FacilitiesSupport Socio-Economic ProgramsTactical Units & Support to toher Enterprises.RDECOMAFSBSACCFielding Quick Reaction CapabilityLead: RDECOMSPT: Contract CmdLCMCG8 / G3Inform Total Army Reqs.1 2 2 3 1 3 4 3 3 2 0 21 0 2 1 0 0 0 1 1 2 4 02 2 4 4 1 3 4 4 4 4 4 28 2 10w w w w w w w w s s7 2 9 s w w w w w w w s5 4 9w s s w w w s s w0 2 2 s s6 2 8s w w w w w s wReset Cycle TimeEquipment ReadinessDefense Acquisition Executive Summary (DAES)Contract CloseoutOrder FulfillmentEarned Value Management (EVM)Increase capability to generate trained, ready forces to meet ARFORGEN requirementsImprove execution of sustainment and reset functionsMaintain a trained and ready military and civilian workforceTechnology Transfer RateProduction%LINs fully equipped during ARFORGEN cycle% AWF certified % AWF on glide path for CLPsAlignment of programs with user requirementProvide greater transparency and visibility of accurate data and information to enhance decision makingEstablish an "enterprise focused culture" which embraces the principles of CPIMetrics StakeholderValuesKey ProcessesStrategicObjectives  Identify the Enterprise Core Value and Map Critical Processes   Analyze the Critical Processes for Waste, Opportunities and Gaps  (Analysis Tools will Vary – depending on the Application)   LESAT Tool Measures the Effectiveness and Lean Maturity of the Enterprise   X-Matrix is used to validate / identify gaps between Strategy, Value Delivered, Processes, and Metrics Measure and Analyze the Current Operating Model  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 17 Lean Flight Initiative, Atlanta, GA, May 11, 2011  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 18 Lean Flight Initiative, Atlanta, GA, May 11, 2011  Enterprise Architecture Framework Policy / External Factors Process Organization Knowledge Strategy A	Products / Services Information Technology http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 19 Lean Flight Initiative, Atlanta, GA, May 11, 2011  EA Example: Reduce Time to Market Imperative Policy / External Factors Process Organization Knowledge Strategy Information Technology Modular and platform product architectures to promote reuse, standardization, technology insertions, etc. Global product development and manufacturing; ITAR restrictions IPD teams with representatives from engineering design, manufacturing and suppliers; collaborative team members with holistic perspective IPD members must understand critical dimensions of product life cycle Engineering Data Management System to support new process Streamlined Integrated Product/Process Development Process; Design standardization and reuse Products / Services Reduce time to market for new product Introduction Responsive support structure, enabled by standardized components and reliable products http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 20 Lean Flight Initiative, Atlanta, GA, May 11, 2011  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 21 Lean Flight Initiative, Atlanta, GA, May 11, 2011  Alignment Equip	  units	  to	  100%	  of	  	  materiel	   requirements	  on -­‐ 6me,	  every -­‐ 6me,	  with	  a	  33%	  cost	  reduc6on Reduce	  cycle	  6me	  by	  	  50% Reduce	  Opera6ons	  and	   Maintenance	  costs	  for	  systems	   by	  50% Achieve	  100%	  data	   transparency	  and	  asset	  visibility Be a credible organization  respected by al Develop	  a	  skilled,	  professional,	   con6nually improving	  workforce	  and	  be	   recognized	  among	  the	  top	   places	  to	  work Become	  the	  ME	  that	  serves	  as	   the	  benchmark	  for	  delivering	   fully	  integrated	  Acquisi6on,	   Logis6cs	  &	  Technology	   capabili6es	  to	  line ’ Strategic	   Goal ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü ü Goal	  #5:	  Bus.	   Processes	  &	  Info	   Tech Goal	  #4:	  Human	   Capital	  Strategy Goal	  #3:	  Leadership Goal	  #2:	  Industrial	   Base Goal	  #1:	  Roles	  and	   ResponsibiliJes Aligning Performa ce Measures to Goals for Army Materiel Enterprise http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 22 Lean Flight Initiative, Atlanta, GA, May 11, 2011  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 23 Lean Flight Initiative, Atlanta, GA, May 11, 2011  Example: ME Project 2.5 – Reduce Operating and Support  Costs of Fielded and Future Systems Operating Support Cost Reduction (DMAIC1) Value Engineering Program (DMAIC1) Engineering Support to Depot (DMEDI2) 22 Descendants Such As: ME Strategic Goal ME Enabling Goals 59 Descendant Projects (Gated & Non-Gated) 42 Parent Projects (Non-Gated) Goals Drove Project Selection Project Results Drove Transformation Notes: 1.  Five-phased methodology for improving existing processes; Define-Measure-Analyze-Improve-Control 2.  Five-phased methodology for developing new processes; Define-Measure-Explore-Develop-Implement Execution of Army Materiel Enterprise Transformation Plan  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 24 Lean Flight Initiative, Atlanta, GA, May 11, 2011  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 25 Lean Flight Initiative, Atlanta, GA, May 11, 2011  0246810120%Not	  Started1	  -­‐ 20%Define26	  -­‐ 40%Measure41	  -­‐ 60%Analyze61	  -­‐ 80%Improve81	  -­‐ 99%Control100%CompletedFollow	  OnJust	  Do	  ItStart	  NowData current as of 3 March 2010 21 projects making significant progress Note: Start Now Projects were 62% Complete Status of 42 Army Materiel Enterprise Parent Projects 189151) Start Now2) Just Do it3) Follow OnProject PrioritizationCategorieshttp://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 26 Lean Flight Initiative, Atlanta, GA, May 11, 2011  http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 27 Lean Flight Initiative, Atlanta, GA, May 11, 2011   Summertime Enterprise Thinking Architecting the Future Enterprise June 13-14, 2011 Prof. Debbie Nightingale Donna Rhodes, Ph.D. June 20-21, 2011 Principles of Enterprise Transformation Prof. Debbie Nightingale Jayakanth Srinivasan, Ph.D  New Course Value-Driven Tradespace Exploration for System Design Future Enterprise Donna Rhodes, Ph.D Adam Ross, Ph.D June 6-8, 2011 Epoch-Based Thinking: Anticipating System and Enterprise Strategies for Dynamic Futures Donna Rhodes, Ph.D. Adam Ross, Ph.D. June 9-10, 2011 LAI Lean Academies: Enterprise, Healthcare, and Product Development July 18-20 or July 18-22, 2011 Eric Dickson, M.D. Hugh McManus, Ph.D. Prof. Earll Murman PD Track Healthcare Track Enterprise Track July 18-20 July 18-20 July 21-22 Eric Rebentisch, Ph.D. Julie Vannerson, M.D. Prof. Annalisa Weigel http://web.mit.edu/professional/ http://lean.mit.edu © 2011 Massachusetts Institute of Technology, C. Robert Kenley, Ph.D  - 28 Lean Flight Initiative, Atlanta, GA, May 11, 2011  C. Robert Kenley Research Associate, Lean Advancement Initiative   Massachusetts Institute of Technology 77 Massachusetts Avenue E38-616 Cambridge, MA 02139 kenley@mit.edu 617-324-1758  http://lean.mit.edu  Thank You! 

LAI and Enterprise Excellence: Presented to Lean Flight Initiative 4

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LAI and Enterprise Excellence: Presented to Lean Flight Initiative 4

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