First some brief background:  In the 1980’s, Toyota Motor Company introduced the world to a revolutionary approach to manufacturing that yielded stunning improvements in quality and speed, while simultaneously achieving significant reductions in cost.  Their approach, which has since been called “Lean Production,” was based on the recognition that most processes are laden with wasteful, unnecessary steps that add little to no value for customers.  The “Lean” approach uses a variety of tools to identify these steps and then to reduce or eliminate them, thereby improving productivity and increasing customer value.

While these methods and their results have received great acclaim throughout the manufacturing sector, Toyota has also applied these same principles to such non-manufacturing processes as engineering, sales, customer service, and administration – and with equally impressive results.  Broadly, this entire approach to process improvement, pioneered by Toyota, is known as “Lean Thinking.”

At RSI, we’re constantly evaluating our performance, looking for ways to continuously improve everything that we do.  As I researched the latest thinking and came across “Lean,” it became clear to me that this approach held tremendous promise.  In particular, I was fascinated by these elements:

• The intense focus on understanding what customers value and then delivering it
• The focus on eliminating “waste” in our processes to deliver results (customer value) faster, cheaper, and more effectively
• The focus on improving quality at the same time as reducing cost
• The orientation toward taking action vs. endless study
• The use of cross-functional teams of front-line workers to identify and implement their own improvements.  In other words, it’s a “bottom-up” vs. “top-down” approach.

The cornerstone to the approach is the use of improvement teams. 

At RSI, we identify a process we want to improve and then assemble a cross-functional team to spend three days “mapping” every step in the current process, identifying challenges and opportunities for improvement, and then creating a “future state map” of the desired result.  Subsequent 3-day events are conducted where additional teams address the identified opportunities and roll out process improvements.  All improvement efforts have goals and metrics to monitor and track results.

So far, more than 50 of our staff have received introductory level training in Lean tools, and more than 30 people have participated in 3-day improvement events.  We’ve rolled out a better process for integrating new customers into our company, and we’re currently working on a series of improvements to our renewal/open enrollment process as well as our COBRA processing.  Other key processes are slated for evaluation and improvement throughout the remainder of 2007 and 2008. 

Perhaps as important as the process improvements themselves, is the engagement of our staff in creating better ways to do their own work.  In your company as well as ours, the people closest to the “front line” usually know more than anyone else what’s working and what isn’t.  “Lean Thinking” gives them the tools to apply that knowledge to improve the way we deliver value for customers.  I’m tremendously excited by what I’ve seen already.

If you’d like to hear more about this approach or to discuss what we’re learning in greater depth, please give me a call or drop me an e-mail at dfriedman@rsionline.com.  I’d love to share more.  I’d also be happy to connect you with Tim Dromboski, our continuous improvement manager, who is leading our Lean initiative.

Warmly,
David

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