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Solving Nagging Problems with the Power of LEO

Nov. 21, 2011
The management called LEO -- Listen, Enrich, and Optimize -- is an overall methodology that makes it possible to apply tools to a maximum advantage.

Managers complain that they're so busy putting out fires that they're lucky if they can get their regular jobs done. They say they can't even consider taking the time to rethink the way things really work -- or don't work. And that whole frame of mind is aided and abetted by top management, which makes a fuss over the firefighters and pretty much ignores the fire preventers.

The awards and kudos go to the saleswoman who drives two hours in her own car, on her own time, to return a lost credit card to a customer at the airport as he's about to board a plane for Europe...or the engineer from another division parachuted in to re-jigger a faulty new pump model...or the team in financial that spends the weekend meeting the deadline for the annual report. We are too busy to correct and prevent the underlying problems that continually require heroic efforts to minimize.

In my work in the quality field, I have observed clients struggling with these systemic problems regularly and realized they needed a flexible, systemic approach to prevent sudden problems by analyzing their source and developing specific solutions. So we began to develop the management approach we now call LEO, for Listen, Enrich, and Optimize, and we have spent years putting it to the test. It has passed with flying colors, because LEO is not simply another management tool, but rather an overall methodology that makes it possible to apply those tools to maximum advantage.

The basic elements of the LEO strategy are straightforward:

  • Listen: Observe and Understand. To obtain a deep comprehension of the issue at hand, put aside past assumptions and directly interact with all relevant parties - specifically including customers, suppliers, and employees. Add to your findings whatever statistical data can be uncovered.
  • Enrich: Explore and Discover. Based upon the information you have gathered, reach out (especially to the frontline employees) for ideas and possible solutions. The wider you cast your net, the more likely you will move beyond the usual suspects to discover new and better answers.
  • Optimize: Improve and Perfect. Examine the solutions you have found and select the best. Subject it to every kind of challenge it might conceivably encounter and correct any and all possible shortcomings
In designing LEO, we selected three general areas of corporate activity where potential quality resides and where the Listen, Enrich, and Optimize functions could be most effectively applied. The three areas are Fire, Flow, and Future. Fire refers to a specific, often sudden problem in any area of the organization. Flow speaks to the operations side of the company. And Future covers new products and services.

The Making of a Jelly Bean

Probably the easiest place to start seeing the benefits of LEO is to apply it to a fire. But before any fire can be put out, you have to know a great deal about the company and the underlying cause or causes of the problem. A case study will give some insight into how LEO works in putting out fires.

The problem was high costs of production on a jelly bean line. From conversations with management and frontline people, as well as studying financial data, our optimum target became obvious. Trimming the weight of the jelly bean packages could save $1 million a year.

Somewhere along the way, there was a glitch that was raising the weight of the jelly bean bags. Complicating the task: the continuous, high-speed nature of the production process. There were three lines of trays, each line turning out a million jelly bean centers an hour.

Implementing the Listen phase of LEO, we stood just past the scale, watching the finished packages of jelly beans zip by at the rate of two a second, and when a particularly heavy package arrived, we would seize it. We opened a dozen of the bags and counted the number of beans in each bag and weighed each and every bean. It was a tedious task, but the results were worth it.

There were a variety of theories on the floor as to what caused the weight variation. That's not unusual. People who work in a plant tend to be smart about how it operates. But finding the root cause of a fire requires a logical, flexible, systematic approach.

What we found in the overweight bags was an inordinate number of underweight beans. Because of those lightweights, the machine was tossing an extra bucketful of beans into a substantial number of bags. We had moved from "overweight packaging" to "underweight product" as the problem source. With that accomplished, we were ready to initiate the Enrich phase of LEO.

Finding a Fire's Flash Point

Uncovering the root cause of a fire has a lot in common with pinpointing the criminal in a bank robbery. You use deductive reasoning to eliminate as many of the suspects (potential root causes) as possible.

To accomplish that winnowing out of suspects, a LEO fire deployment typically uses split-tree analysis. Starting at the top with the project statement, the tree grows downward through a series of connecting lines and parallel boxes. In this case, there were three side-by-side boxes labeled "sugar coating," "wax coating," and "jelly bean center." Tests showed that only the latter could be responsible for the weight problem.

The investigation now focused on the substantial number of trays bearing underweight bean centers. We used a Multi-Vari Chart, a method for displaying patterns of variation. It showed that the underweight centers were being created in one particular corner of all of the affected trays. Once more, it was a process of elimination. At one point, we found that a cross beam in the machine disrupted the flow of starch. However, if the cross beam was the answer, then why wasn't every tray that came down the production line affected?

We needed a better solution -- a complete root cause. We found it when we tested the effect of delivering a less-than-normal quantity of starch to the trays, as sometimes happened during the production process. We found that these trays, if not thoroughly cleaned of the resulting defective beans, which we called globs, caused later jelly beans runs to create underweight beans.

After eliminating one suspect after another, after about two weeks of mentoring and learning, we had finally identified the guilty party. It was the glob.

Fire Prevention

Moving to the Optimize phase of LEO, we proposed steps that would both put out the fire and prevent its recurrence. We suggested cleaning the trays as soon as possible, and often, to halt the production of underweight bean centers and removing the cross beams. Once these changes were put in place, the benefits to the company proved to be far greater than the expected $1 million in savings. All told, the LEO deployment increased the productive capacity of the plant by a substantial 15%.

Such results are typical of LEO firefighting. Typically, though, the person in charge of manufacturing is less than enthusiastic when we arrive on a firefighting mission. To some degree, that's because it makes him look bad: Why was he unable to extinguish the fire on his own?

Only gradually, as people start to recognize the advantages of the LEO approach, do they develop a more cooperative attitude. For a company to get the maximum benefit from putting out fires, managers on every level need to open themselves to the LEO process and embrace it.

Subir Chowdhury is chairman and CEO of ASI Consulting Group. He'/s the author of 13 bestselling books including the latest, The Power of LEO: The Revolutionary Process for Achieving Extraordinary Results. In 2011, he was named as one of the "50 most influential business thinkers in the world" by the Thinkers50.

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