Digital transformation for chiefs and owners. Volume 2. Systems thinking. Dzhimsher Chelidze

is divided into four sections:

      – Long-term perspective philosophy;

      – The right process gives the right results;

      – Add value to the organization by developing your employees and partners;

      – Permanent solution of fundamental problems stimulates continuous learning.

      Section I. Philosophy of the long term.

      Principle 1. Make management decisions from a long-term perspective, even if this is detrimental to short-term financial objectives.

      It’s about focusing on long-term development, not operational performance. Additionally, unfortunately, it’s the one that’s most often ignored because it’s a psychological trap.

      What do owners or shareholders usually want from top management? Right, beautiful revenue figures, operating margins, EBITDA, profitability.

      As a result, all development projects, as a rule, are an attempt to sit on two chairs, to develop something, to rebuild, but not to hesitate at the moment. There’s nothing wrong with that, but, alas, it rarely works. Of course, if you move systematically and progressively, then it will be, but if you have already entered a crisis or have grown up by yourself, then this approach is unlikely to work.

      Here it is important to remember the main postulate of lean production: your main task, as a person, as an employee, as a company – to create value for the consumer, society and economy. In evaluating any work, one should focus on whether it solves this problem.

      Section II. The right process produces the right results.

      Principle 2. A continuous flow process helps to identify problems.

      Its essence is to organize the work and production process with minimal losses, stocks and unfinished production. This approach, combined with well-functioning communication, allows problems to be identified at an early stage before they become a danger or crisis. In my practice, this is generally the main rule, including in the implementation of projects – collect feedback and identify problems as early as possible.

      Principle 3. Use the pull system to avoid overproduction.

      Are you familiar with the situation where you are being squeezed into the work of another unit? I often see the principle when different units work on their own. As a result, there is stocking of raw materials warehouses or folders with incoming service / letters / tasks.

      This is the most common problem for department heads in dealing with subordinates. Many such leaders, in fact, are «transferees» – they only throw tasks over to the executive. The employee accumulates 40—50 tasks, he tries to do everything, jumps from task to task, and in the end does nothing. Additionally, as practice shows, if you limit the number of work tasks to three, productivity rises to 50%. Firstly, a person does not jump from one task to another (the process of immersing the brain in the problem takes 20—40 minutes), secondly, he has at least some diversity and variability, this protects the psyche, and allows you not to hang on to one problem.

      We need to get the domestic consumer who takes your job to get what they need at the right time and in the right amount. This is the basis of the tool «Exactly in time» – new products or tasks should come only as the previous. Additionally, here Kanban boards will help a lot. About them too, a little lower.

      In general, it is necessary to minimize the unfinished production (current and for offices).

      Principle 4. Distribute work evenly (heizunka): work like a turtle, not a hare.

      Familiar is the situation of heroism and proverbs «sometimes empty, sometimes densely»? In Japanese philosophy it is called Mura. Additionally, one of the tasks of thrifty production is to make the load evenly, without talking at the end of the month and endless heroics. And the modern planning systems, including ERP, MES and APS, that we talked about in the first book, will help. Well, so are Kanban boards if we learn to look at the process and optimize it all the time.

      Principle 5. Stop production to solve problems with part of the production culture, if so required by quality.

      Why were so valued, and are Toyota cars appreciated? Right, for quality. If we want to work with clients who have money, we need to ensure quality.

      Quality for the consumer determines your value proposition. Additionally, that’s where the smart machine with machine vision comes in, which is to watch the product and the process and see if everything works according to the technical process. You need a visual system that immediately notifies the leader of the problem. Therefore, in my projects, I make extensive use of color tags in task cards. For example, the green label means «Everything according to the plan», blue – coordination or waiting for information, red – «There is a problem, need help». Digital tools here in general give unlimited flexibility, the main thing – the leader daily to do a review and if problems arise, to turn on and eliminate the reasons.

      If we are talking about production, the tool Dzidok (equipment with machine vision or complex automation) – the foundation for «embedding» quality.

      As a result, the approach by stopping or slowing down the process and getting the required quality «from the first time» will increase the productivity of processes in the future: you will simply eliminate the causes of problems and deviations.

      Principle 6. Standard objectives are the basis for continuous improvement and delegation of authority to staff.

      Every time I hear the thesis «we do not have standard tasks», as a rule, it means that the team simply do not know or do not want to structure the work.

      Stable and reproducible working methods – the key to process management. Additionally, his task is to create a more predictable result, improve the coherence of work, and make the output more uniform. It’s the basis of flow and pull.

      Yes, if you have a very young company, then for a while it will be irrelevant, you need to run the whole system, give a result, but in the end there is nothing without it. Endless creativity always leads to crisis.

      Knowledge should be captured, for example, by reviewing projects, identifying and standardizing best approaches and methods. At the same time, it is necessary to encourage the improvement of these standards. In general, continuous improvement – the main creed of thrifty production. But to improve something, it must first be described and fixed. Otherwise, there will be chaos with all the consequences. Additionally, this is also more than relevant for IT. Creative guys do not like to standardize their work, but alas, it is necessary through «I do not want».

      Principle 7. Use visual control so no problem goes unnoticed.

      This principle is actually part of the 5th principle. As mentioned, I use color labels. But it requires discipline, and it comes from a supervisor.

      Where possible, reports should be reduced to one page, even if they were critical financial decisions. There is even an «A3 Report» tool for this.

      Principle 8. Use only reliable, proven technology.

      Technology should help people, not replace them. If we are talking about digitization and automation, it is often better to first do the whole process manually, and then implement the digit and automate.

      First, you will see the most problematic places; secondly, avoid the illusion that everything can be automated. In addition, new technologies are often unreliable and difficult to standardize, threatening the flow. The same artificial intelligence, despite all its development, still admits sometimes quite stupid mistakes.

      Therefore, instead of unverified technology, it is better to use a known, well-established process. At the same time, it is necessary to encourage the study of new technologies and ways. After all, everything