edition - University of Wisconsin–Stout

.,

Assessing the Percentage of Business and Industry Utilizing Lean

Strategies Where University of Wisconsin-Stout

Graduates are Employed

By

Thomas Harvey

A Research Paper Submitted in P31iial Fulfillment of the

Requirements for the Master of Science Degree

III

Training and Development

Approved: 4 Semester Credits

J ames Keyes, PhD

The Graduate School University of Wisconsin-Stout

August 2010

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The Graduate School University of Wisconsin-Stout

Menomonie, WI

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Author: Harvey, Thomas K.

Title: Assessing the Percentage of Business and Industry Utilizing Lean

Strategies Where University of Wisconsin-Stout Graduates are Employed

Graduate Degree/ Major: MS Training and Development

Research Adviser: James Keyes, Ph.D.

MonthlYear: August 2010

Number of Pages: 61

Style Manual Used: American Psychological Association, 6th edition

Abstract

Lean manufacturing or lean production is an organizational approach to process

management, known simply as lean. Lean focuses on the removal of any aspect of a process not

intended to bring about greater customer satisfaction and product value. The purpose of this

study was to determine the percentage of businesses and industries utilizing lean, as an

operational strategy, where University of Wisconsin-Stout graduates were employed. The aim

was to understand the increase in the number of student enrollments in lean related courses

offered by the College of Operations and Management at the University of Wisconsin-Stout.

Quantitative data was gathered by a research-based survey sent to 425 Bachelor of

Science graduates from the University of Wisconsin-Stout (Stout). The three majors targeted in

the study were Business, Business Administration and Engineering Technology; pat1icipants

graduated between 1995 and 2008. Responses were returned from 20% of p311ici pants.

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The results of the survey indicated lean strategies are used widely by business and

industries where Stout graduates are employed. Almost half, 48%, of respondent's report that

their current employer utilizes lean methods within their organization. Of those reporting to use

lean, 52% reported the use of lean throughout the entire organization, with 29% repOliing the use

of the lean in production/operations side of the organization.

The increase in the number of students enrolling in lean-based operations and business

classes appears to be based on the wide implementation of lean strategies across a range of

business and industries. The University of Wisconsin-Stout may continue to see a continued

demand for the knowledge, skills and abilities based centered on the principles of lean

production.

The Graduate School

University of Wisconsin Stout

Menomonie, WI

Acknowl edgments

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I would like to acknowledge and thank all of my instructors that I have encountered in

my pursuit of my degrees. My goal would not be possible without the help and suppoli of the

home unit, thanks to you both.

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Table of Contents

.......................................................................................... . .... . ................ Page

Abstract .. ............................................................................................................. ............................ 2

List of Tables .............................................. .. .................................................................................. 7

List of Figures ............................................................................................. .... ... .. ........ .. ..... ..... .... ... 8

Chapter I: Introduction ...... ................... .... ........ ...... ............................................ ....... .... .................. 9

Statement of the Problem ................. ........................................................................................... 9

Purpose of the Study ................................................................................................................. 10

Assumptions of the Study ......................................................................................................... 10

Definition of Tenns ................................................................................................................... 10

Limitations of the Study ............................................................................... ............. .. .............. 12

Methodology .......... .. .................. ...... ... .. .................................................................................... 12

Chapter II : Literature Review ........................ .......................................................................... ..... 14

Lean Manufacturing-An Overview .................................................... ..................... ... ............... 14

Benchmarking ........................................................................................................... 16

Just in Time ............................................................................................................... 17

Six Sigma .................................... .. ..... .. ...... ........................................... ....... .... ...... ... 19

Lean Six Sigma .... ... ........... .......... ..... ... .. ............ .... .. ... ...... .. ........ .. ...... ...... ...... ....... ... 21

Theory of Constraints ......................... ..... .... .. .... .. .. ................................................... 24

Chapter III: Methodology ............................................................................................................. 27

Subject Selection and Description ....................... .. ................. ............................................... ... 27

Instrumentation ....................................................................... .................................................. 27

Data Collection Procedures ....................................................................................................... 28

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Data Analysis ............................................................................................................................ 29

Limitations .......... .......................................................................................................... ........ .... 30

Summary .......................................................................................... ........ .... .......... ................... 30

Chapter IV: Results ...................................................................................................................... 31

Data Analysis ........... ...... .... ................................... ................. ... ....... ....... ....... ........................... 31

Organizations where Lean is utilized ........................................................................................ 33

When Lean is not utilized ....................................................................... ........ .......................... 37

A Look at University of Wisconsin-Stout Graduates .............................. .... ............................. 39

Chapter V: Discussion .... .............................................................................. .......... ...................... 41

Limitations ................................................................................................................................ 41

Conclusions ............................................................................................................................... 41

Recommendations ........................................................................................ ............................. 42

References .............................................................................. ...... ................. .. ....... ....................... 45

Appendix A : Survey Invitation ..................................................................................................... 48

Appendix B: IRB Exemption .... .. .................................................. .. ....... ................ ....................... 49

Appendix C: Survey Results ......................................................................................................... 50

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List of Tables

Table] : Select the business or industry that best describes your organization ................ .. .. .. 3]

Table 2: How many people are in your organization? ... ...... ... ...... ........ ............ .... .... ............... 32

Table 3: Within your organization, where do you employ lean? ................................... .... ..... 34

Table 4: How long has your organization used lean? .............................................................. 34

Table 5: Lean has given our organization a return on our investment in it .................... ........ 35

Table 6: In what way could or should UW Stout be preparing graduates to utilize lean in

industry ............................................................................................ 40

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List of Figures

Figure 1: Do you cunently use lean as your operational strategy? .................................... 33

Figure 2: Select the benefits your organization has realized in its use of Lean ...................... 37

Figure 3: Reasons an organization may not use Lean .................................................... 39

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Chapter I: Introduction

Today's businesses are facing a competitive global marketplace. While many books and

articles have been written regarding lean as an operational and process management strategy,

little information exists on the number of organizations in business and industry utilizing lean at

the time of this study. However, lean is not the only operational strategy currently in use in

business and industry; competing with lean is: Six Sigma, Theory of Constraints, Lean Six

Sigma, Just in Time. Process management, as defined by the book of the same name (Becker,

Kugeler and Rosemann, 2003) is a method of planning and measuring outputs of a process in

business or manufacturing. Organizations across sectors and scales of business and industry see a

managed process as a way to increased profitability. Not all organizations employ an operational

or process management strategy; some organizations have even moved away from lean in recent

times in favor of a more agile approach to manufacturing (James, 2005). The research was

conducted to ascertain the number of businesses and organizations using lean where graduates of

the University of Wisconsin-Stout are cUlTently employed specifically.

Statement of the Problem

The University of Wisconsin-Stout programs in Business, Business Administration and

Engineering Technology has experienced an increase in the demand for courses based in lean

theory and practice. This study was conducted in an attempt to understand the demand for lean

courses and to project if the need would continue. Little data exists as to the percentage of

organizations utilizing lean practices in 2010 or what operational or process management

strategy is in place where University of Wisconsin-Stout graduates gained employment.

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Purpose of the Study

The intention of this study was to determine if the Business, Business Administration and

Engineering Technology programs at the University of Wisconsin-Stout should continue to meet

the demands of the students seeking course work relating to lean methodologies. Furthermore,

the study will conclude if a change is needed to increase the number of classes and coops offered

to students of these programs.

Assumptions of the Study

The assumptions of this study are:

1. Not all respondents will know their current employers organizational or

operational strategy.

2. Not all invitees will participate in the study.

3. Not all contact information provided to the researcher may be up to date and

accurate.

Definition of Terms

Benchmarking. A continuous, systematic process for evaluating the products, services

and work processes of an organization recognized as representing the best practices in

organizational improvement (Spendolini, 1992).

Just In Time (lIT). A system of planning for a manufacturing process that optimizes the

scheduling of materials to alTive at the manufacturer when needed and in only quantities req uired

for meeting the objective (Hirano & Makota, 2006).

Lean. Lean manufacturing or lean production is an organizational approach to process

management. Lean focuses on the removal of any aspect of a process not intended to bring about

greater customer satisfaction and product value. (Endsley, Maghill, and Godfrey, 2006).

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Lean Six Sigma. Is a relatively new process improvement method that combines both

lean and Six Sigma methodologies. It began in the late 1990s as companies began cross-training

employees in the two frameworks and combined aspects of each operational strategy (George,

Rowlands & Kastle, 2004).

Original Equipment Manufactures. (OEM) Is a manufacturer or producer of a finished

product; generally the last manufacturer before the end-user purchases the product (Womack,

Jones, & Roos, 1990).

Process Management. The application of the Imowledge, skills, techniques of an

organizations to define, visualize, measure, control, report and improve processes with the goal

to meet customer requirements with profit (Thorn, 2009).

Theory of Constraints. An approach to continuous improvement (reducing operating

expenses and inventory and increasing output) based on a five-step procedure: (1) identifying

constraints, (2) exploiting the binding constraints, (3) subordinating everything else to the

decisions made in the second step, (4) increasing capacity of the binding constraints, and (5)

repeating the process when new binding constraints are identified. It seeks to identify a

company's constraints or bottlenecks and exploit them so that tlu'oughput is maximized and

inventories and operating costs are minimized. (Goldratt, 1984)

Total Quality Management (TQM) This management strategy employs all facets of an

organization (design, engineering, production, marketing, and finance) in order to meet their

business objectives and meet customer expectations by minimizing production errors,

streamlining the supply chain, utilizing modern equipment and training employees (Aguayo,

1991 ).

Six Sigma. Developed by Motorola, this management strategy seeks to reduce the

OCCUITence of error and variability through data analysis (Motorola University , 2010).

Value. Is a determination of the worth of a product or service that is assessed by the

customer (Womack, Jones, & Roos, 1990).

Limitations of the Study

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1. The subjects of this study are limited the undergraduates of the University of

Wisconsin-Stout programs in Business, Business Administration and Engineering

Technology from the years running consecutively from 1995 to 2009.

2. The participation is voluntary by respondents.

3. Respondent has to know of the operational strategies of their employer, past and

present.

4. Recommendations are for the University of Wisconsin-Stout, it's programs,

Business, Business Administration and Engineering Technology and the College

of Operations and Management.

5. The findings in this studying are not predicted to be valid after 5 years.

Methodology

A web-based anonymous survey was selected to pursue this inquiry. An invitation to

pmiicipate was sent to all UW -Stout graduates drawn from a spectrum of undergraduate and

graduate programs in Business, Business Administration and Engineering Technology at the

University of Wisconsin-Stout. Targeted business and industry graduates were: distribution, food

production, and hospitality/tourism, manufacturing, medical, and retail.

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A return rate of20% was realized on theon-line survey sent out to 425 graduates of the

University of Wisconsin-Stout programs Business, Business Administration and Engineering

Technology. The selected graduates were from the 1995 to 2009. All invitees were provided the

0ppOliunity to withdraw from the survey at any time.

Approval for this research was sought from the Institutional Review Board (lRB) at the

University of Wisconsin-Stout, which granted an exemption for this research. The survey and

data were compiled with the help and technical assistance from the Applied Research Center

located at the University of Wisconsin-Stout.

Chapter II: Literature Review

Lean Manufacturing-An Overview

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The intention of this study was to asceliain the number of employers in business and

industry utilizing lean as a strategy where University of Wisconsin-Stout graduates were

cUlTently employed. Lean manufacturing was a process developed by Toyota Production System

and the early influence of Dr. W. Edwards Deming, a renowned American statistician; Deming

worked along side the Japanese during their post-war industrial growth (Aguayo, 1991). Deming,

founder of Total Quality Management (TQM) (Dobyns, 1990), promoted the concepts of quality

through the reductions of flaws inherent in the process of manufacture of a product, streamlining

the supply chain as well as modernizing equipment and training employees to the highest degree

possible. Later in life Deming stated that, in issues effecting quality, 96% of the problems were

in the work system and 4% attributed to the individual worker (George, Rowlands & Kastle,

2004). Deming did not work alone to develop quality improvement methods while in Japan;

Taiichi Ohno, Shigeo Shingo and Eiji Toyoda worked to continually develop Deming's concept

into a process at Toyota, from the years 1948-75 (Emiliani, Stec, Grasso, & Stodder, J., 2007).

The lean manufacturing concept began within the Toyota Production System in Japan and

was both investigated and documented in the seminal work of James Womack, Daniel Jones and

Daniel Roos (1990). Womack, Jones & Roos gave credit to follow researcher John Krafcik for

coining the term lean as early as 1988 (Krafcik, 1988). There was an apparent need for lean, in

the large scale, original equipment manufactures (OEM) of the world as explained by Womack

(1990) the author of The Machine That Changed the World, was in outgrowth of organizational

expectations placed on modern mass production. No longer was the individual craftsperson able

to produce their quality goods at a competitive price most consumers can afford, a result of the

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industrial revolution. While mass-producers can produce mass goods manufactured at a price

consumers can afford, there are both wastes and variations in product quality associated with

minimally skilled workers running complex and expensive machinery. To meet the demands of

the consumer in the post-industrial era OEM utilized resources that, by today ' s standards, were

wasteful. The extra employees, extra material and replacement parts on-hand needed to keep up

production are all examples of waste; the craftsperson did not have to contend with such

overhead as pali of their production methods. Lean production/manufacturing is as simple as

getting the right things to the right place, at the right time and in the right quantity to achieve the

perfect work flow. Nothing more and nothing less is needed or warranted in this production

model. This philosophy changed the way business and industry chased profit.

Lean manufacturing offers a dynamic work environment that is too restrictive operates

under severe limitations or prescriptive constraints. Womack, Jones & Roos gave the example of

one Japanese automaker, Toyota, which had the flexibility to offer more automotive products in

the marketplace than did the big 3 auto makers of Detroit during the same period in time. Toyota

was capable of producing the feat with half the labor effort and they did it in half the production

time it would have taken General Motors (GM) to do the same. They achieved this benchmark

by consistently evaluating the process constructing their system of production. Toyota also

changed the way a worker viewed the down time of retooling a machine. At one time a worker

would enjoy the long work delay associated setting up to run a different product on the

production line. A worker may have considered this retooling as pali of business and the

company absorbs the loss resulting from such an event. Toyota convinced their workers it was to

everyone's mutual benefit (increase in productivity and wage) to change a retooling process that

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was measured in the number of hours, to a process that took only minutes to produce the same

outcome.

While this production method is spreading around the world and into a variety of

industries, Womack and Jones (1996) asserted in order to make the transition to lean and to

capitalize on what lean could do for an organization is dependent on a committed workforce.

With lean workers need different skills; workers are now sharing what is known about their work

and adding the to the process of production. Information is shared across the organization not

just up and down as traditionally held organization operates. This meant workers were more

challenged on the job; they have become more productive, perhaps even stressed about their

work. Less individual pursuit and more collaborative engagement across the organization was

the new norm. Professional skills will be needed along with creativity and problem solving skills.

Thinking became more important than doing as one conceptualizes their newfound

responsibilities within the organization. Teamwork was central across sectors of in organization;

ad hoc groups are formed as needed to service specific ends.

While it is important to have a complete understanding of ones own organizational

capacity, the concept of how well one organization does inside their own sector of business and

industry is critical for a high performing organization. A systematic process for evaluating the

products, services and work processes of an organization, recognized as representing the best

practices, expands the knowledge of how efficiently one's operations are truly running. This

barometer is known in manufacturing as benchmarking.

Benchmarking According to Spendolini (1992) the utilization of metrics, within the areas of product

design and development, cycle time, production time, material handling, overhead costs and

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finally the retail prices, allows an organization to rank itself with similar organizations within an

industry, when compared to others in the same industry. Once the common and comparative

practices are identified and compared from one organization to another, especially an innovator

or a leader with in the industry, an organization can indentify the areas within their own

organization they need to change in order to become more efficient (and competitive) in their

operations. Additionally, benchmarking is used to establish criteria in which an organization can

also measure itself for use in the future or in comparison of the effolis past. Lean is often a viable

operational and process management strategy to achieve and evaluate industry-leading

benchmarks. However, lean methodologies have direct competition as an operational strategy in

business and industry around the world setting or challenging existing benchmarks with differing

approaches to process management.

Just in Time As early as 1934 the principles of Just in Time (lIT) emerged as Sakichi Toyoda moved

from textiles into automobile and then truck production (Ohno, 1988). As an earlier operational

strategy of Toyotas Total Production System, "The goal is to provide the right information, to the

right people, at the right time-just in time so they can take action based on that information

(Kerschberg and Jeong, 2005)." This key tenant of JIT is seen in the lean philosophy the

production methods of today.

Under ideal operational conditions for Just in Time, a company would have just enough

production material on the floor, on a single day to produce the given number of units set for

production for that day. Additionally, any product manufactured that day would be shipped

immediately. Any material aITiving could be queued for immediate use. Thus we observe a cycle

of planned management where needs are forecasted and production follows. While this ideal was

rarely obtained, organizations have realized a return on investment in the application of these

principles. Inventory is seen as waste; it represents tied-up capital, which could be utilized to

greater effect if it were not sitting on a shelf. Idol machinery and over staffing human capital

were seen as equally inefficient.

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These ideal principles are achieved by commanding the inventory control process and

production, with the foresight of anticipating consumer demand for the product. However,

reducing unneeded inventory and simply controlling total outputs does not address or reflect the

Demming view of quality improvement. With lIT, the most likely oPPOltunity to improve on the

customer delight of the product is on-time delivery; early delivery of the product or service

offered to the customer is the extent of the potential improvement in this process management

approach.

lIT can be administered on management levels where buy-in for the entire organization is

not necessary, depending on the long term strategic planning of the organization. lIT does

require commitment from the top of an organization it does not require a workforce trained in

applying a celtain prescribed process to each task or duty. For Ohno (1988) the belief was

quality was sure to improve, considering there is just enough material to produce what is needed

and the worker would strive to get it right the first time knowing resources were limited in

availability. This had the potential of putting an undue stress on the line worker to reach this

goal, unaided by improvements within the system. Oil production and refinement are examples

in the influence of lIT principles appear to work will for an industry (Bongiorni 2004). The

downfall of this philosophy may be in the dependence of suppliers of material. In 1992 General

Motor's attempt at lIT was hampered by a railroad strike, which left idled a 70,000 workforce.

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This vulnerable aspect of JIT, coupled with the fact that it may be hard to determine future

demand of a product made it largely ineffective for wide application in business and industry.

Six Sigma Six Sigma was developed at Motorola USA in 1981 (Telmant, 2001) as a methodology

to improve the quality of outputs by reducing the cause of defects and variations of products in

their manufacturing and business operations. This approach developed as a result of Motorola's

loss of television-set market share to the superior Japanese television manufacturer. Much like

Deming's statistically based TQM (Stamatis, 2004), Motorola's production methods are

statistically founded as well. One Sigma, as it is known in manufacturing, is a yield of 31 % in

defect-free products; Motorola's Six Sigma strives to meet an impressive 99.9966% defect-free

production goal. In every day terms it means this: 3.4 defects are found in one million customer

requested products (Long, 2010). For example, of the 3.2 million prescriptions written for

patients in the U.S. each year (Caplan, 2007), 7,000 deaths occur as a result of unreadable or

illegible writing on the part of the person writing the prescriptions. Here we can see numbers do

matter, the move to improvement has to be made and a sound process was needed to reduce

operational errors in areas other than manufacturing.

While an accuracy rate of99.999978% is laudable for many industries and businesses, it

is not accurate enough in the medical field. There is no significant statistical difference in these

elTor percentages year after year; this is an on going issue with the medical industry. The point

here is that numbers are not the only metric to measure customer satisfaction or safety. There are

times in which business and industry has to move beyond the numbers. To this end Motorola has

moved Six Sigma into 3 levels of their organization (Motorola University, 2010), as a metric, as

a methodology, and as a management system.

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Six Sigma is more than a method of removing flaws often inherent in the manufacturing

process and thus the product. For Six Sigma companies the potential for process improvement

needs to be included in every business practice, including those jobs that are considered non

revenue producing. Six Sigma has been applied to business practices that appear to be

unconventional, such as properly filed paperwork, customer complaints, and even effectiveness

of solvents used in manufacturing to cleaning the corporate offices. Once indices and metrics are

developed they could be applied in broad application.

As quality management methods stand, Six Sigma shares the need for organization wide

buy-in, which is lead and supported by top management. FUliher, an organization will have

processes for business and manufacturing that are documented; they can be measured, analyzed,

improved shared, and even benchmarked. However, what sets Six Sigma apart from other

methodologies is the way in which leadership supports this philosophy, considering the (often

high) up front costs, the need to produce measureable and quantifiable financial retUl11 for a Six

Sigma project, use of ranked participants as change agents and finally the likelihood that

decisions will be based on data sets; to the exclusion of other information. This very prescriptive

approach requires an understanding of a statistical understanding to accountability; this is not an

approach, which lead to a quick financial retUl11 on problem solving. Further, to implement Six

Sigma an organization will either have to develop a belt-canying Six Sigma expert or obtain this

knowledge base from outside the organization. Most organizations do not have the resources or

the sustained 10ng-telID vision to accomplish this complex feat. However, this may be changing

as Six Sigma can now be seen expanding into sectors of business and industry where Six Sigma

application is an emerging trend (Edgeman & Dugan, 2008).

In the work titled, "Six Sigma from products to people to pollution," Edgeman and

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Dugan (2008) assert the day has arrived for the Six Sigma concepts to move beyond the walls of

OEM's and into arenas that may not seem to fit the Six Sigma customer profile. While the

widely accepted approach of Define-Measure-Analyze-Improve-Control (DMAIC) or Design for

Six Sigma (DFSS) inherent to Six Sigma are similar to Deming's Plan-Do-Study-Act, they are

now taking on ethical issues in their application outside of manufacturing. Although historically

aligned to profit, the DFSS of Six Sigma may help in the advancement of genetic engineering,

for example, but what if prolonged life leads a company to payout benefits longer than they may

have before a certain discovery is made and implemented? This conundrum seems to be in

opposition of the fundamental assumption that statistics always provides the answer.

While Six Sigma has improved the situation of the recipients of such a discovery it may

not help the bottom line of the healthcare business applying this methodology, a double-edged

sword if you will. This may explain the need for an operations methodology where the statistics

are not weighed as heavily in consideration of the organizations objectives. While Six Sigma has

a focus on reducing variations on the production of a product and service through process

management, for some organizations more is needed on the organizational level.

Lean Six Sigma Six Sigma is not a process management approach that fits for all organizations. In an

effort to seek out a viable process improvement method, which fits the strategic objectives of an

organization, a combination of both lean and Six Sigma methodologies have been combined in

what is known as Lean Six Sigma. What qualifies Lean Six Sigma as a process improvement

method is the fact customer delight is seen as the preeminent goal. Statistical data is used to

identify and eliminate problems inherent in the production process and leadership and

employees have to buy into the philosophy. (George, Rowlands and Kastle, 2004). Lean Six

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Sigma combines production objectives and customer satisfaction into one process.

The four critical elements in Lean Six Sigma are not significantly different than lean or in

Six Sigma. Process improvement, when evaluated shares many common attributes. Customer

delight, improvement to the processes, teamwork of individuals based in different departments

through out the organization, and their decisions that are data-based, and leadership at the top of

the organization in support of the methodology (George, Rowlands & Kastle) are foundations to

the Lean Six Sigma philosophy.

Today's consumers are under siege with the amount of products and services offered

from the global marketplace. No longer does Motorola just a cell phone to consumers, they offer

117 models in their attempt to prove they understand customer delight (Motorola University).

Gone are the days were business produced just what an engineer recommended, or what the boss

wanted to see and when the boss wanted to see it. Customers have the ability to shop in the

international marketplace, the Internet, and select the product at the price where they find

consumer value resides as they define it. Lean Six Sigma ensures that the first question that is

asked is asked in the customer's behalf. The manufacture has to consider the "Voice of the

Consumer" (VOC) when operating in today's highly competitive business environment. Defects

no longer have to be tolerated; this is a different than the time were at the time when only 1 or 2

OEM's of a product served the world.

Determining what is a defect and how to reliably measure them is an impOliant step for

any provider of goods or of a service. For one business it may be helpful service, for others it

may be timely shipping of a product that delights the customer. Each organization needs to

understand how the customer expectations have a perception on value. Value is impOliant for the

customer, not just during improvement projects but at all times that the goods and services are

23

out in the public domain. Organizations utilizing Lean Six Sigma try to uphold this concept as a

key premise to their operations. Once an organization gains an understanding of the customer

they then have to evaluate their process to meet the covenanted customer delight benchmark.

Trial and error are no longer the accepted approach to process improvement. Customer

expectations are often too high for a new product or technology; they want it to work right the

moment it comes off the shelf. Reducing variations or defects in the products or services is the

key tenant in the Six Sigma approach. In their book "What is Six Sigma," George, Rowlands,

and Kastle (2004) offer a case study (p. 27) as an example of the lean attributes to demonstrate

how the 2 are tied together. Six surgeons were performing similar bypass surgeries; each

requested a surgical tray that reflected their own approach to surgery. That required six different

trays prepared for six different surgeons. By assembling all the surgeons in one room the topic

was explored as to why each surgeon a distinctly different set of tools for the same procedure. As

the surgeons reflected on this question it was evident there was a methodology to examine their

various needs. Considering the fact there was statistical evidence that proved there was a benefit

to the patients in having 6 different surgical trays the doctors agreed to a standardized surgical

tray. By applying these tools, reduction in the variation of services offered (Six Sigma) along

with the process thinking (lean), Stanford hospital was able to reduce costs $25 million and at the

same time reduced mortality from 7.1 % down to 3.7% in the cardio depaJ1ment.

This example demonstrates that Six Sigma requires skill sets in two different abilities to

implement this methodology. First is the statistical analysis of all the aspects of the business that

can be identified and measured, The second skill set needed is the ability evaluate the process

and the work flow of an organization. The change agents needed to bring this about are trained in

the same manner as Six Sigma; green belts are the lower level where information is generally

24

collected and analyzed. The black belt has the responsibility for the project overall. These

certifications are earned tlu'ough a comprehensive training program which may be offered in-

house, by outside consultants and finally, at colleges and universities.

Theory of Constraints As lean has emerged as a product Toyota Production System, the Theory of Constraints

(TOC) evolved out of the previous work of Eliyahu Goldratt PhD. Optimized Production

Technology was an attempt by Goldratt to address the needs of industry and an attempt to

enlarge the production capacity of any manufacturer tlu'ough a process reliant on his software

application. Disappointed by the fact his idea never came into fruition Goldratt followed up his

software with a book entitled Goal (Goldratt & Cox, 1986), which explored the idea of

constraints and bottlenecks; a constraint is anything that prevents a producer from reaching their

capacity. A "bottle neck is any resource whose capacity is equal to or less than the demand

placed upon it. The maximum speed at which a producer can manufacture goods is related to the

slowest operation within the system. A non-bottleneck is any resource whose capacity is greater

than the demand placed on it " (Goldratt & Cox, p. 139). When considering the capacity of a

manufacturer to produce their product Goldratt evaluates tlu'ee areas he believes effects

production. The first is tlu'oughput, this is seen as a goal in the number of units to produce or the

money generated from producing these units; secondary is the operating expense. This category

looks at how much money it will cost to produce given the number of units. And finally,

inventory is the money the company has to invest in order to meet the tlu·oughput. In order the

measure these 3 areas consistently Goldratt has developed 5 steps to evaluate any given

production process (page 301):

Step 1. Identify the system's bottlenecks.

Step 2 Decide how to exploit the bottlenecks.

Step 3 Subordinate everything else to the above decision.

Step 4 Elevate the systems bottlenecks.

Step 5 If, in a previous step, a bottleneck has been broken go back to step 1.

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There is not a limit, minimum or maximum to the number of constraints an organization

can face . These constraints may be internal, not being able to meet the demand of the consumer;

it may be external as well. An example of external constraint is when production exceeds

consumption. Goldratt has updated his earlier work and now includes the notion of a Thinking

Process as a way to not only manage a production process but also manage the system. With this

updated model Goldratt asserts the real power to effectively and efficiently bring about change

within an organization are (Goldratt Institute, 2009 p.9) :

• Understanding the interdependencies between and across processes that contribute to

delivering a product or service,

• Understanding the impact that those interdependencies and normal variability have on

their cOlnbined, overall performance, and

• Appropriately buffering for interdependencies and normal variability so that that

performance can be predictably and consistently high.

The TOe Thinking Processes utilizes logic trees to provide a plan for change. The

process guides the organization through the decision making of problem structuring, problem

identification, solution building, and identification of bottlenecks to overcome, and finally the

implementation of the solution. Goldratt claims once organizational leadership adopts his

26

methodology the producer will be able to address any sudden shift in the marketplace (Goldratt

Institute). However, this operational strategy appears limited in both scope and metrics when

compared to lean, Six Sigma and Lean Six Sigma methodologies. It appears to focus on a few

individuals within an organization having the vision and values to affect the outputs of the

organization. This approach cannot be seen as needing organization wide by in. In the three

operational and quality improvement methods already explored in this work TOC does not have

the holistic vision lean or Six Sigma produce for an organization. TOC does not address the

value-added process to ensure customer delight many of today's OEM's believe is necessary in

the increasingly global marketplace.

The theories behind the concept of bottlenecks are not a product of Eliyahu Goldratt

alone. The idea in which production will only be as strong as the weakest link of the supply

chain/operations was explored greatly in the Just in Time operational philosophy (Olmo).

It is clear from the literature reviewed for this research lean offers the best balance of

supply chain logistics, production methodology and overall operational strategy of all the process

management philosophies in existence today. It can be a holistic approach for an organization to

reduce what is not need to bring delight to the customer. Lean has also displayed the ability to

move beyond serving the OEM's of the world. Furthetlliore, Gary Conner, author of Lean for the

small shop, (2001) makes the case for the use oflean; it is time to expand the limits of lean to

just OEM's. The practices are scalable to the smallest shops, offices and the small businesses in

America today.

27

Chapter III: Methodology

Research was conducted to asceliain the number and scope of businesses and

organizations utilizing lean where graduates of the University of Wisconsin-Stout (UW Stout)

are currently employed. A convenience survey was conducted with graduates of the Business,

Business Administration and Engineering Technology programs from the years 1995 through

2009. The research for this study was to determine if the Business, Business Administration and

Engineering Technology programs at the UW Stout should expand their capacity to offer lean

methodology related courses. This chapter will describe how subjects selection and description,

the method of constructing the instrument, the data collection procedures, how the data was

analyzed and finally, the limitations of this research.

Subject Selection and Description

To investigate the number of businesses and organizations practicing in lean concepts a

sample group for a qualitative study was drawn from graduates holding a Bachelor of Science

degree from the University of Wisconsin-Stout. The subjects in this research graduated in the

years 1995 to 2009 from the Business, Business Administration and Engineering Technology

programs within the College of Operations and Management at the university. This population of

undergraduates had the opportunity to enroll in process improvement related course work while

attending the University of Wisconsin-Stout.

Instrumentation

The anonymous survey constructed for this research was developed following the

discovery in the lack of a reliable data on the number of business and organizations utilizing lean

practices. A need to investigate trends relating to lean was also apparent as the investigation for

the construction of the instrument took place. The instrument was designed to identify

28

organizations inside and outside of traditional OEM's employing lean principles. To effectively

utilize the data for future purposes it was critical to identify: which sectors of the economy use

lean, the number of people within the organization, where within an organization a process

improvement methods were utilized, and how long was the method in place. It was also

impOltant to research process improvement methods in place before an organization moved to

lean or away from lean practices. It was also important for the respondent of the survey to

convey their understanding of why lean may work for their organization as well as why lean may

not work for an organization. Equally impoltant was to understand why an organization would

move to adopt lean principles and what would keep an organization from implementing lean.

This study has been reviewed and the project is exempt under Category 2 of the Federal

Exempt Guidelines by The University of Wisconsin-Stout's Institutional Review Board ORB)

(Appendix B). The IRB has determined this study meets the ethical obligations required by

federal law and University of Wisconsin-Stout policies, IRB approval was sought to protect and

preserve the rights of the participants. All personal contact infOlmation was deposed at the

conclusion of the data collection.

Data Collection Procedures

An email was sent to 425 University of Wisconsin-Stout graduates inviting them to

participate the 18 question qualitative survey. One week later a reminder to paIticipant in the

survey was dispatched to the entire group. Participation in this anonymous online survey was

voluntary; the paIticipant had the right to stop the survey at any time. Participant confidentiality

was protected. Their selection and palticipation were not shared with other palties and all such

information relating to participants was destroyed at the conclusion of the data collection

process.

29

The respondent observed two decision points in the survey. One point explores lean as

the current process improvement strategy or process management where the University of

Wisconsin-Stout graduate was employed. In the same setting, the instance where lean was not

the cunent process improvement strategy; the respondent was asked to share their understanding

of why lean was not the current process improvement strategy or process management approach.

The respondents chose one decision point and proceed to share their knowledge of their

organization.

Data Analysis

The Research was conducted to ascertain the number and scope of businesses and

organizations utilizing lean where graduates of the University of Wisconsin-Stout were

employed. Considering no two qualitative surveys are the same each approach to their evaluation

will be different (Patton, 2002). However, using a through literature review and the data from the

survey, an evaluation was performed based on the prearranged goals for the research.

• Evaluate the number of organizations utilizing lean philosophies where University of

Wisconsin-Stout finds employment.

• Sectors of business and industry where is lean operated.

• Length of time lean been in use at the current employer.

• Why lean is working.

• If lean is not used, why not.

• What is process improvement strategy or process management is utilized in place of lean.

Coding of the data was done using NVivo Qualitative software through the Applied

Research Center at the University of Wisconsin-Stout. After all the data was collected and coded,

it was reviewed for revisions where needed. After all coding was completed; reports were

created to determine the frequency of the comments in each theme. Tables and figures were

created for each theme/subtheme containing frequencies.

30

Limitations

The subjects of this study are limited the undergraduates of the University of Wisconsin

Stout programs in Business, Business Administration and Engineering Technology from the

years running consecutively from 1995 to 2009.

Summary

a. The participation of respondents was voluntary.

b. The respondent had to know of the operational strategies of their employer, past

and present.

c. Recommendations are for the University of Wisconsin-Stout, it ' s programs,

Business, Business Administration and Engineering Technology and the College

of Operations and Management.

d. The findings in this studying are not predicted to be valid after 5 years.

A web-based survey was used to reach alumni of the University of Wisconsin-Stout. This

national investigation was intended to reveal both the industries and the sector of the business

where lean and other process improvement methodologies are practiced. An addition to those

goals, it is important to establish a benchmark at this time in order to understand trends that

develop as a result of future research into this topic.

31

Chapter IV: Results

The intention of this chapter is to report the findings of the eighteen question instrument

sent out to Stout graduates in business and industry. At the third question, "Do you cUlTently use

lean as a strategy within your organization?" a decision point is created. If a respondent replies to

the question in the affirmative, the subject is directed to one set of questions illuminating the

practices oflean principles within the paI1icuiar organization. If the respondent replied that lean

was not used, the respondent was directed to a different set of questions than those, which replied

in the affirmative. The rational for the approach was to understand ifthere is a shift away from or

towards lean and to understand what other process management techniques exist in the

organizations where graduates of the University of Wisconsin-Stout work.

Data Analysis

The first question in the survey was constructed to ascertain the specific sector of a

business or industry the Stout graduate was employed within. When the question as asked,

"Describe the business or industry that best describes your organization," 100% of respondents

selected an option; there is a clear understanding of the cross section of opportunities for Stout

grads.

Table 1

Select the business or industry that best describes your organization.

Response Frequency (N=78) Percentage

Manufacturing 31 38%

14

I

17%

- - --- . - .- - _. 8

I

10%

InsurancelFinancial

Hospitality/Tourism

- - --

6 1- 8% Retail

32

- . - -

Distribution 5 7%

Technology 5 7%

Medical 4 6%

Service 4 6%

Food Production 1%

The second question was focused the number of employees in the organizations where

Stout students were working. The size of an organization may speak to the notion of how fast

change can occur within an organization, or how responsive that organization might be to

adapting to new methodologies. The finds reflect there are more small and large firms utilizing

lean methods, however, around 10% of the sampled population works in the mid-range size of

organizations; just under half of the respondents work in large organizations.

Table 2

How many people are in your organization?


1-10 8 10%

11-25 9 11% L _____ _ I 26-50 4 5%

51-100 5 6%

101-500 16 21%

More than 500 37 47%

33

Organizations where Lean is utilized

The survey addresses one of the principle questions of this investigation, which was, "Do

you cUlTently use lean as a strategy within your organization?" The effort was to quantify the

number of employers utilizing lean, a question which lacked sufficient evidence and lead to this

research. Any recommendations to result out of the research would be expressed based on the

findings. Clearly, lean is practiced in about half of all the employers of students from the

Business; Business Administration and Engineering Technology programs sat the University of

Wisconsin-Stout.

Figure 1

Do you currently use Lean as a strategy within your organization?

Yes

No

It is not only important to know how many employers utilize lean methodologies, but

where, within an organization lean is practiced; question 4 sought to answer that. This reflects an

effOli to understand which aspect of an organization can benefit from this process management ·

approach. A majority of replies stated the use of lean throughout the entire organization. This

opposes the idea lean is limited to the production aspect in business and industry.

34

Table 3

Within your organization, where do you employ lean?


Top to Bottom 19 61%

Production 8 26%

-Supply Chain 3 10%

Industrial Engineering 3%

The fifth question of the survey, results reflected in Table 4, addresses how long lean has

been practiced in the corresponding organization. Stout graduates reported 52% of their

employers have made commitments to lean for 5 or more years. While the remainder, 48% have

implemented lean in the last 5 years or less; 29% of respondents have seen lean come online in

their organization since 2008. The data shows the slight decline in the use of lean principles in

the last 3-5 years, however the numbers of organizations putting lean into practice is beginning

to increase once again.

Table 4

How long has your organization used lean?


Ten years or more 3 10%

Five to ten years 13 42%

Three to five years 6 19%

r _ • • _.~ . -- - -

Two years 3 10%

One year 3%

Less than one year 5 16%

35

ImpOliant to any organization for the methodologies selected for process management is

profit or a return on investment (ROI) for an organization, lean is no exception. When asked,

"Has lean given your organization a return on its investment?" In Table 5 Stout graduates

reported they strongly agreed, at a rate of 39% of the time, that lean had provided a return on

investment to their organization. Those that would agree to the statement are slightly higher at a

rate of 42%. While 16% of respondents could not confirm if lean lead to a profit of a loss, it is

clear for 81 % of those polled, their organization have receive a financial benefit for establishing

lean as their method of process management.

Table 5

Lean has given our organization a return on our investment in iI.

Response

Strongly agree

Disagree

Neither agree or disagree

~ Agree

Strongly agree

Frequency (N=31)

o

5

13

12

Percentage

3%

0%

16%

42%

39%

Not all organizations started with lean as a way to reduce waste, improve efficiencies,

and maximize customer delight. Some organizations tried the statistical-based model introduced

by Demming in the last century; Total Quality Management was attempted by 13 % of employers

of Stout graduates before moving to lean. Toyota's Just-in-Time principles were applied injust

6% of organizations surveyed. The highest rating of this category went to Motorola's Six Sigma;

29% of the locations Stout graduates were employed at use the variation-control process

36

management method. For some employers, 29%, lean is the first recognized attempt at a process

management solution, having not tried any other methodology previously. It appears that 16% of

respondents utilize a multi-method approach to process management. One Stout graduate

observed both Total Quality Management and Theory of Constraints employed in their

workplace, at the same time. Others repolied the use of Six Sigma in one area of the organization

while at the same time utilizing Just-in-Time concepts for a competitive edge. One Stout

alumnus indicated that "several tools from multiple strategies" were implemented in their place

of work; this demonstrates a "cafeteria" approach where one picks and chooses from all the

options available, based on what they want out of each operational strategy.

When asked, "what brought your organization to lean?" 42% of those polled responded

that it was a management decision to move to lean practices some where within their

organization. Streamlining a process was the motivation of moving to lean for 26% of

organizations. The choices of the reputation of lean, a management decision, too many

operational enors, to reduce waste, streamline process and the recommendation of a consultant

were all the reasons for 7% of the sampled population to accept lean as their organizations

operational strategy. Because lean addresses all of the considerations stated above, leans

reputation lead 6% of those examined to use lean in day-to-day operations. While lean is known

for its ability to reduce waste, it was only 10% of the population that admitted it as the single,

most impoliant reason for the move to lean.

The move to lean is intended to produce a benefit to an organization. When the use of

lean had ended for an organization this research attempted to understand the issues sunounding

the decision to move away from lean practices. Of those responding to this question on the

survey 50% of respondents believed it was not the COlTect organizational fit. There were 20%

that responded that when current management left, so did the lean practices within the

organization.

Figure 2

Select the benefits your organization realized in its use of Lean

37

40% ,------------------------------------------------------------------------

30% +----------------------------------------------------------------i

20% +-------------------------------------------,---~-----

10% +-------------------------------------------;

Greater teamwork

across organization

Increase production

When Lean is not utilized

Reduction of Reduced Reduced waste Increased All of the above errors redundancy profits

As stated above, 52% of respondents indicated that lean was not in use at their respective

place of employment. Of those employers where University of Wisconsin-Stout were employed,

half of the aforementioned respondents had observed no process management approach was in

place. It is fair to conclude from the statistical analysis that only 25% of all employers examined

in this research do not use any fOlmal, planned, or measurable approach in how their employers

conduct their operations. Six Sigma is clearly the second choice in the workplace; for those

polled, 20%, have selected Six Sigma as their pre felTed operation strategy. Total Quality

Management and Just-in-Time shared equal usage in non-lean use at ten percent. Three

respondents failed to indicate which operational strategy, other than lean, was in place at the

38

employer. Lean Sigma was intentionally left off the list of options to choose from . Those that did

utilize lean would have answered a different set of questions based on how the decision point

was placed early in the survey.

There were organizations which had implemented lean in their past, but had moved to

another operational strategy. Half, 50%, of those that had implemented lean, had moved on to

Six Sigma as their operational strategy. While 17% have accepted Just-in-Time as the new

approach to conducting business. The length of time lean was in use in organizations where Stout

graduates work is informative. Employers that no longer use lean principles had stated, at a rate

of 17%, that lean was used for 3 to 5 year time period before the use of lean had ended.

However, the majority, 83%, stated that lean was only in practice for one year or less before its

discontinuance. To attempt to understand why lean may not have worked for certain

organizations, respondents replied 5% of the time that lean was too complex. On a similar track

50% of those polled stated that lean was not a con-ect fit for the organization that had moved

away from lean principles. When management changed so did the process management approach

according to 4% of the population; it appeared lean left with the management that support it.

In examining the reasons why an organization may not be seeking a lean advantage, the

sample group, as displayed in Figure 3, stated 52% of organizations lack the knowledge to utilize

lean. While the lean philosophy states that anything that does not add value to the customer is

waste and, thus, should be eliminated, 22% of respondents stated there was no value in

implementing lean. Too implement lean would have been too complex of a process management

philosophy to practice, according to 13% of those polled. That figure comprises a 65% segment

of organizations that have either no knowledge of lean of believe it is too complex to implement.

For organizations not using lean, 9% believed they would not know when they are "there";

meaning the outcomes or justification for the use of lean are not easily identifiable. A small

percentage, 4%, believed the successes of Jean methods are yet unproven.

Figure 3

Reasons an organization may not use Lean

60% ~---------------------------------------------------------

52% 50% +--------------------------------------------------r--~

40% -r-------------------------------------------------~

30% ~-------------------------------------------------~

22% 20% +--------------------------------------f---,------~

13% 9%

10% +---~~M------------------~

0% +--------'--

Success is unproven

Won't know when "there"

Too complex Don't see value in No knowledge of Lean Lean

A Look at University of Wisconsin-Stout Graduates

39

The largest segment of respondents, 74%, identified themselves as undergraduates with a

degree in General Business Administration. The next largest population, 16% had graduated

Stout with an undergraduate degree in Engineering Technology; 9% of those polled did not

identify which program they had graduated from.

When asked how the alumni ofthis survey believed the University of Wisconsin-Stout

had prepared them for an organization interested in lean, 5% strongly disagreed with asseltion

they were prepared. Almost in balance with those graduates, 3%, that strongly believed

University of Wisconsin-Stout had prepared them for lean practices in business and industry. An

additional 20% of respondents disagree with the premise that they we prepared to practice lean, a

40

smaller percentage compared to the 23% that did agree the University of Wisconsin-Stout had

prepared them for lean in the workplace. However, 49% of those surveyed took a neutral

position and stated they neither, agree with or disagree with the question pertaining to the

question asking if the University of Wisconsin-Stout had prepared them well for lean in business

and industry.

When University of Wisconsin-Stout graduates were asked how Stout could or should be

preparing students for lean in business and industry their insights can be seen in Table 6.

Table 6

In }Fhat way could or should UW Stout be preparing graduates to utilize lean in industry.


More classes on lean 33 58%

Co-ops and internships 36 63%

On campus workshops 24 42%

Guest speakers 19 33%

It is clear that the graduates of the University of Wisconsin-Stout have clear ideas on

their preparation for work in business and industry. Their views reflect a hands-on approach to

learning about lean. The possibility of working in an organization where lean principles are

currently practiced was seen as the greatest opportunity to bring that knowledge forward. A

greater concentration of classes focused on lean was also important to a majority of respondents.

While a large minority believed their knowledge, skills and ability of using lean would improve

with workshops and guest speakers on campus.

41

Chapter V: Discussion

To determine the number of organizations utilizing lean as an operational strategy or

process management, where University of Wisconsin-Stout graduates work, a convenience

survey was conducted among graduates of the Business, Business Administration and

Engineering Technology programs from the years 1995 through 2009. The investigation was to

assist in determining the scope of the use of lean within an organization and if there has been an

identifiable trend in the increase or decrease of the use of lean and how to prepare students to

meet the needs of business and industry.

Limitations

The subjects of this study are limited the undergraduates of the University of Wisconsin

Stout programs in Business, Business Administration and Engineering Technology from the

years running consecutively from 1995 to 2009.

a. The participation of respondents was voluntary.

b. There is no way to confirm the responses to the survey.

c. The respondent had to know of the operational strategies of their employer, past

and present.

d. The findings in this studying are not predicted to be valid after 5 years.

Conclusions

This work examined operational strategies other than lean, which are in place in business

and industry. Some operational strategies focus specifically at the supply chain .TIT, for example.

There was also production methodologies (TOe) used conjunction with supply chain practices

(.TIT) in places where graduates of Stout worked. Both TQM and Six Sigma are centered on the

42

elimination of variations in production was also practiced among those surveyed. Even the

blended methodologies of Lean Six Sigma which is focused on the improving organizational

efficiencies through the practice of eliminating variations in production and the elimination of

any process that does not add value to the customer was popular in organizations surveyed. Six

Sigma and Lean Six Sigma requires highly trained individuals specializing in the analyzing of

data; this approach requires individuals committed to the process and may not have another

function . within the organization. Lean does not require the level statistical evaluation Six Sigma

requires, which may be one of the reasons lean is in place in 48% of respondents work. It is

easier to employ within an organization and the stmi-up costs are not as great as the cost of

implementing a Six Sigma strategy (George, Rowlands and Kastle). Lean offers what may be the

most widely adaptable approach to process management applicable to modern production

methods to be seen to date.

Recommendations

Lean is the most widely applied process management methodology in place for working

graduates of the University of Wisconsin-Stout. Of the organizations investigated, 20% utilized

Six Sigma while TQM along with JIT both experienced a rate of implementation of just 10%

each. When compared to 48% of respondents stating lean practices where in use, lean is

practiced at a rate that is more than twice as large as the nearest alternative methodology. Lean

usage appears to be on the increase in the last several years. In the last five years 48% of those

surveyed stated lean had been implemented. Those repOliing, 52%, state lean has been a part of

their organizations philosophy for five years or longer. It is also import to note that while 61 % of

organizations use lean through out their entire organization, 26% of organizations found it

43

beneficial to the production side of the organization. Only 10% of respondents claimed the use of

lean was limited to the supply chain management.

As a result of this study there is reason to believe that further research into the process

management practices of employers where University of Wisconsin-Stout graduates are

employed should continue. The first consideration for this recommendation is to help identify

trends in business and industry as it relates to what operational strategies many University of

Wisconsin-Stout graduates may experience in the workforce. The second consideration is to

advise the University of Wisconsin-Stout as to the forecasted need for education of lean

principles graduates will need when they enter the workforce. While there is a clear need for the

University of Wisconsin-Stout to continue or increase the number of lean related course

offerings, respondents have identified the oppol1unity of increased co-ops and internships as vital

to their understanding and preparation to practice lean in business and industry upon graduation.

Only slightly less significant was the need for more or more extensive classes on lean. This

would address the needs of 85% of respondents that don't use lean; stating their organizations

lack a working knowledge oflean, that it is too complex or don't see the value to their

organization to implement lean. It appears the recommendation of those surveyed would

decrease the lack of understanding and knowledge for the application of lean in their respective

organizations. When Stout graduates contribute to the success of an organization through their

knowledge and application of lean principles it not only increase the value of the graduate to the

employer, but to the University of Wisconsin-Stout in its attempt to meet the needs of business

and industry.

The survey respondents revealed there are benefits to the utilization of lean within the

place of their employment. If students have a working and applicable knowledge oflean it may

44

increase their opportunity for employment. This claim is substantiated by the fact that those

organizations that employ lean practices, 81 % have claimed to receive a return on the investment

for implementing lean. As Figure 2 revealed, there are many benefits for the use of lean in

business and industry. The University of Wisconsin-Stout can play an impOliant pati in preparing

individuals for the practice of lean. If a Stout graduate has the knowledge, skills and ability to

lead an organization to reduce errors in production, reduce waste and increase profits, the

demand for their services will be in demand. Thus the demand for University of Wisconsin-Stout

students will increase in business and industry.

It is clear that process management is a way to success for a globally completive

organization. This research proves lean experiences the widest application of process

management methods applied today, where graduates of the University of Wisconsin-Stout

graduates work. Lean is seen in organizations of various sizes and in various sectors of the

economy. To meet the needs of organizations moving to lean or already utilizing lean practices

the University of Wisconsin-Stout serves a critical role. The exposure to lean for students outside

of business administration and engineering technology is becoming increasing important based

on the results of this survey. My hope is this research leads the University of Wisconsin-Stout to

evaluate the needs of business and industry and offer the students of Stout an education rich in

applicable lean practices in preparation of their employment in a variety of areas around the

world.

References

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Fireside: Whitby, Ontario

Becker, J., Kugeler, M. & Rosemann, M. (2003). Process management. New York: Springer

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Bongiorni, S. (2004). All in the timing. The Greater Baton Rouge Business Report. 19 July 2004

Caplan, J (2007). Cause of death: Sloppy doctors. Time. Retrieved from

http://www.time.com/time/healthiarticle/0.8599.1578074.00.html

Conner, G. (2001). Lean manufacturing for the small shop. Dearborn, Michigan: Society of

Manufacturing Engineers

Edgeman, R. & Dugan, G (2008). Six sigma from products to people to pollution. Total Quality

Management. 19(1-9)

Emiliani, B. Stec, D., Grasso, L & Stodder, J. (2007). Better thinking, better results: case study

and analysis of a enterprise-wide lean transformation. Center for Lean Business

Management, ISBN 978-0-9722591-2-5

George, M., Rowlands, D. & Kastle, B. (2004). What is lean six sigma? New York:

McGraw-Hill

Goldratt, E. & Cox, J. (1986). The goal: a process of ongoing improvement. Hudson, NY: North

River Press

Goldratt Institute (2009). The theory of constraints and its thinking processes. Manuscript

submitted for publication.

Hirano, H. & Makota, F. (2006). JIT is flow: practice and principles of lean manufacturing.

Vancouver, W A: PCS Press Inc.

James, T. (2005). Stepping back from lean. Manufacturing Engineer, 84 (1) p. 16-21

Johnson R., Kast, F. & Rosenzweig, 1. (1973). The themy and management of systems. New

York: McGraw-Hill

Kerschberg, L. and Jeong, H. (2005). Just-in-time knowledge management. Retrieved from

eceb.gmu. edu/pubs/JIT _ KM_ Kerschberg_Jeongpd!

Krafcik,1. (1988). Triumph of the lean production system. Sloan Management Review, 30(1)

p.41-52

Long, 1. (2010). What is lean? Manuscript submitted for publication.

Motorola University (2010). What is six sigma? Retrieved from

http://www.motorola.com/BusinessIUS-EN/Motorola+University/Six+Sigma+Articles

Ohno, T. (1988). Toyota production system. New York: Productivity Press

Patton, M. (2002). Qualitative research and evaluations methods. Thousand Oaks, CA: Sage

Publications

Spendolinni, M. (1992). The benchmarking book. New York: AMACON

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Stamatis, D. (2004). Six sigma fundamentals: a complete guide to the system, method and tools.

New York: Productivity Press

Tennant, G. (2001). Six sigma: spc and tqm in manufacturing and services. Aldershot, UK:

Gower Publishing

Thorn, W. (2009). People, process, and petformance management in project management.

Retrieved from http://www.pmhut.com!people-process-and -performance-management -in

proj ect -management

Womack, J ., Jones, D. & Roos, D. (1990). The machine that changed the ."orld. New York:

Simon & Schuster

Womack, 1. & Jones, D. (1996). Lean thinking. New York: Simon & Schuster

Womack, 1. & Jones, D. (2005). Lean solutions. New York: Free Press

47

48

Appendix A: Survey Invitation

Greetings Fellow Stout Alum:

My name is Tom Harvey and I am currently pursuing a graduate degree at UW-Stout. I am researching Lean as a management strategy across the spectrum of business and industries represented by Stout graduates. Even if your organization does not currently use Lean there are questions in the survey for you as well. This, less than 5-minute, survey will allow post-secondary institutions, such as Stout, to improve their educational priorities based on your input into this research; so please participate now.

You can double-click on the provided link to complete the survey, if necessary you may copy & paste the link into your Internet browser to connect to the survey. Your participation in this study is entirely voluntary. You may choose not to participate without any adverse consequences to you. If you complete the survey I will provide you with the results of my research , just email for a copy at the completion of the research.

This survey will terminate in 15 days so your quick action is vital to this research. Feel free to contact me at (715) 456-3623 cell, (715) 232-1145 office or by email at [email protected] if you have any questions or ideas pertaining to my research; any input is welcome. Thank you for your valuable time. Go Blue Devils!

This project has been reviewed by the UW-Stout IRI3 as required by the Code of Federal Regulat ions Title 45 Part 46

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Date:

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Appendix B: IRB Exemption

December 16, 2009

Thomas Harvey Jim Keyes

Sue Foxwell, Research Administrator and Human ~6UJ y~~ Protections Administrator, UW -Stout Institutional Review Board for the Protection of Human Subjects in Research (IRB)

Subject: Protection of Human Subjects in Research

49

Your project, "Lean Manufacturing in Business & Induslly " is Exempt from review by the Institutional Review Board for the Protection of Human Subjects. The project is exempt under Category 2 of the Federal Exempt Guidelines and holds for 5 years. Your project is approved from December 14,2009, through December 13,2014.

Please copy and paste the following message to the top of your survey form before dissemination:

[I.T=h=iS=. p=ro=~c=ct=h=as=b=c=cn=r=CY=ic=W=Cd=b=Y=t1=lc=U=W=-=S=to=ut=IR=B=as=rc='q=ui=rc=d=b=Y =th=c C=o=d=c =of==;

Federal Regulations Title 45 Part 46 I I L-__________________________________________ ~

If you are conducting an online surveylinterview, please copy and paste the following message to the top of the form:

"This research has been approved by the UW-Stout IRB as required by the Code of Federal regulations Title 45 Part 46."

Please contact the IRB if the plan of your research changes. Thank you for your cooperation with the IRB and best wishes with your project.

*NOTE: This is the only notice you will receive - no paper copy will be sent.

50

Appendix C: Survey Results

1. Select the business or industry that best describes your organization.

# Answer Response % 1 a. Distribution 3 4%

2 b. Food Production I 1 1%

3 c. Hospitality/Tourism 7 9%

4 d. Manufacturing 26 33%

5 e. Medical 5 6%

6 f. Retail 6 8%

7 g. Other 30 38%

Total 78 100%

g. Other # Statistic Value

Financial Services / Banking 6 Mean 5.14

Insurance 6 Variance 3.06

Technology and professional services 3 Standard Deviatio n 1.75

Facility Services 2 Total Responses 78

Aerospace 1

Center for Applied Ethics 1

Construction 1

Distribution/Manufacturing 1

Electrical 1

Government 1

Health Fitness Clubs 1

Multifamily/Real Estate 1

Paper Converting 1

Railroad Transportation 1

Real Estate Development 1

Sawmill for log home company 1

Software / Consulting 1

Wholesale-giftware 1

2. How many people are in your organization?

# Answer Response % I 1-10 8 10%

2 11-25 9 12%

3 26-50 • 4 5%

4 51-100 • 5 6%

5 101-500 • 16 21%

6 More than 500 37 47%

Statistic Val ue Total Responses 78

3. Do you currently use Lean as a strategy within your organization?

# Answer

1 Yes

2 No

Total

Statistic Mean

Variance

Standard Deviation

Total Responses

Response % 41 48%

44 52%

85 100%

Value 1.52

0.25

0.50

85 -

51

4. Within your organization, where do you enlploy Lean?

# Answer Response

1 a. Production/Operations I 8

2 b. Supply Chain 3

3 c. Industrial Engineering 1

4 d. Transpoliation I 0

5 e. Top to bottom 19

Total 31

Statistic Value Mean 3.61

Variance 3.31

Standard Deviation 1.82

Total Responses 31

5. To the best of your knowledge how long has your organization used Lean?

# Answer Response 1 Ten years or more - 3

2 Five to ten years 1 • .",,- .. '''" ;.:. ..... ""''''_ 13

3 Three to fi ve years -' - l 6

4 Two years 3

5 One year 1

6 Less than one year 5

Total 31


Variance 2.57


Total Responses 31

% 10%

42%

19%

10%

3%

16%

100%

52

% 26%

10%

3%

0%

61%

100%

53

6. Lean has given our organization a return on our investment in it. State your understanding of this statement.

# Answer Response % 1 Strongly Disagree 1 3%

2 Disagree I 0 0%

3 Neither Agree nor 5 16%

4 Agree r~ ',11 •• 13 42%

5 Strongly Agree ,.i.c_' '~"'-I 12 39%

Total 31 100%


Variance 0.85


Total Responses 31

7. What, if any, was your operational strategy before moving to Lean?

Answer Response % 1 a. None r·," " 9 29%

2 b.TQM 4 13%

3 c. Six Sigma ~. 9 29%

4 d. Just In Time • 2 6%

5 e. Lean Sigma I 0 0%

6 f. TOe Manufacturing I 0 0%

7 g. Other I 7 23%

Total 31 100%

I g. Other

Not positive - know that other methods were used, though

Tools from mUltiple strategies still incorporated today.

Both Band F

Depends on the area, we use Six Sigma and Just in Time also

All Above

VMr


Variance 5.06


Total Responses 31

8. If you do not utilize Lean, select your current operational strategy?

# Answer 1 a. None

2 b.TQM

3 c. Six Sigma

4 d. Just In Time

5 e. TOe Manufacturing

6 f. Other

Total

f. Other N/A

Response 15

3

6

3

0

3

30


Variance 2.70


Total Responses 30

9. If your organization has moved away from Lean as an operational strategy what are you currently using?

% 50%

10%

20%

10%

0%

10%

100%

54

# Answer Response %

1 a.TQM 0 0%

2 b. Six Sigma 3 12%

3 c. Just In Time 1 4%

4 d. TOe Manufacturing 0 0%

5 e. Never used Lean 20 77%

6 f. Other 2 8%

Total 26 100%

f. Other N/A


Variance 1.20


Total Responses 26

10. To the best of your knowledge, if your organization has used Lean in the past, how long was it employed?

Answer 1 Ten years or more I

2 Five to ten years I

3 Three to five years

4 Two years I

5 One Year I

6 Less than one year

Total

Statistic Mean

Value 5.50

Variance 1.50

Total Responses I 6 I

Response % 0 0%

0 0%

1 17%

0 0%

0 0%

5 83%

6 100%

I Standard Deviation I 1.22 I

55

11. If your organization does not use Lean select the reason it does not.

56

# Answer Response %

a. Too expensive 0 0%

2 b. No knowledge of Lean . -."-!.- - • '....:. r,ta 12 52%

3 c. Too complex 3 13%

4 d. Success is unproven 1 4%

5 e. It is just "the latest thing" 0 0%

6 f. Won't know when we are 2 9%

7 g. Did not see a value in it 5 22%

Total 23 100%


Variance 4.60


Total Responses 23

12. What brought your organization to Lean?

# Answer 1 Leans reputation

2 Management decision

3 Too many operational

4 Reduce waste

5 Streamline processes

6 Recommendation of

7 Other -Total

Other Has always been part of our culture.

All of above

Management, reputation, operational elTors, reduce waste.

All of the above

Economy

Statistic Value

Mean 3.71

Variance 4.01


Total Responses 31

57

Response % 2 6%

13 42%

0 0%

3 10%

8 26%

0 0%

5 16%

31 100%

58

13. Select the benefits to your organization has realized in its use of Lean.

# Answer Response

Increase in production 2

2 Reduction of errors 2

3 Reduced waste 5

4 Reduced redundancy 2

5 Increased profits 7

6 Greater team work across

7 Other 12

Total 31

Other All of above

Several of the above (reduced waste, redundancy, increased production efficiency,

All of the above on various projects

None yet


Variance 4.03


Total Responses 31

%

6%

6%

16%

6%

23%

3%

39%

100%

8

59

14. Describe your understanding of why Lean may not have worked within your organization.

Answer

1 Too complex

2 Proved unsuccessful

3 Change in management

4 Moved to different

5 Was not the COlTect fit in

6 Other

Total

Other nla

Hasn't been used.

I

I

Probable would not work in my industry

Just a distribution plant that has not tried Lean

Unknown


Variance 1.82


Total Responses 20

Response %

1 5%

0 0%

4 20%

0 0%

10 50%

5 25%

20 100%

60

15. UW Stout has prepared me well for the use of Lean as an operational strategy in business/industry?

# Answer Response 1 Strongly Disagree 3

2 Disagree 12

3 Neither Agree nor 30

4 Agree 14

5 Strongly Agree • 2 I- -

Total 61


Variance 0.77


Total Responses 61

16. In what way could/should UW Stout be preparing graduates to utilize Lean in industry?

# Answer Response 1 a. More classes on Lean 33

2 b. Co-ops and Internships 36

3 c. On campus workshops l"'''1,' '"'~ .~=i, 24

4 d. Guest speakers 19

Statistic Value Total Responses 57

% 5%

20%

49%

23%

3%

100%

% 58%

63%

42%

33%

61

17. Class of:

Value Total 1997 5 2007 4

2000 7 1995 2 2009

1996 6 1999 5 [No Value] 9

2008 6 2006 5

2001 4 2005 6 Value Total

2003 8 1998 4 BS 78

2002 9 2004 [No Value] 9

6

18. Prinlary Degree

Value I Total General Business Administration I 64

Engineering Technology 14

[No Value] 9

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