Baselines are essential to improvements. They are the starting point for a process to be changed, or are reference points for ongoing processes. Baselines can be used in two main ways.
First, they can be used to establish current conditions prior to a project. This is essential to knowing if the changes actually had the positive impact they were expected to.
The other common use of baselines is as a comparison point for an ongoing metric. In this application, a baseline is sometimes referred to as a jumping-off point. This type of metric is typically reset every year as a new starting point to evaluate progress on annual goals. (Note: You may also see a baseline compare a current period to an earlier period. For example, financial analysts routinely use the previous quarter and the year-ago quarter as baselines to evaluate earnings in the current period.)
People should not be standing watching machines or pulling levers. They are far more intelligent than that. Give them jobs that use that intelligence, and sever their ties to machines. Focusing on this premise, that workers are more than just machines, shows great respect for people, one of the central tenets of continuous improvement.
Scalability is the ability to easily ramp up or down to changing requirements. The term is in common use in information technology, specifically in reference to the ability of a system to grow to accommodate increasing traffic.
ABC inventory is a method of categorizing inventory to segment items into different inventory management processes. Typically, the segmentation is done by calculating out the annual usage of the parts, and labeling the top 70% of parts (by cost) as ‘A’ parts, the next 25% as ‘B’ parts, and the final 5% as ‘C’ parts. On occasion, an organization may include all parts without usage over the last year as another category (i.e. ‘D’ parts).
The power of this categorization lies in the Pareto Principle. Typically, around 15-20% of your parts will fall into the ‘A’ category. Around 30% will be in group ‘B’ with the remaining items in group ‘C’. The bottom line is that the majority of your inventory cost is contained in a relatively small quantity of part numbers. That means that you can get big gains with relatively low effort.
The program leader faces a particularly challenging task in promoting this principle. In a nutshell, he or she will be dictating to the senior staff not only who they hire, but how they spend their time.
Many senior leaders spend far too few hours of the week developing their subordinates…and their own replacements. For some, it is just not a priority. They have a lot on their plate, and they just don’t emphasize mentoring. For others, though, it is actually a conscious decision.
Some leaders are insecure, and don’t want to create competition for themselves. They don’t want to give their boss a viable alternative. The reality is that leaders who fall into this category are…
Control limits are lines established 3 standard deviations from the mean on a control chart. Keep in mind that the control chart depicts averages, so exhibits a normal distribution. (See Central Limit Theorem) 99.7% of all random variation (common cause) will fall within the upper and lower control limits. Outliers can generally be assumed to be outliers, indicating that the process is out of control.
When a process is said to be ‘in control’, statistically speaking, that means that all the variation can be attributed to common causes. All of the observed variation is just a function of the natural randomness built into a system or process.
In a nutshell, an ‘in control’ process is free of special cause variation.
A control, or control group is a tool used to confirm whether changes are actually having an effect. The control group is exposed to the same conditions as the test group with the exception of the variable that is being examined.
For example, you may be experimenting whether increasing tire pressure makes a difference in mileage. You would keep all other factors the same (route, vehicle type, brand of gas, etc.) the same for two groups. The only difference would be in tire pressure. The control group would have the current tire pressure, and the test group would have the higher pressure.
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