1. Your book presents “practical applications of lean principles” as a pathway to improving speed to market and also reducing costs. This is a pretty common expectation of lean techniques. What angle do you present that is different from other books or methods on the market?
Chris Cooper: Our book specifically addresses the practical application of the lean principles to nonrecurring processes such as new product development, project work, or service design. Most conventional lean books ignore a lot of people’s reality, which is that their work is not done in a repeatable ‘widget factory.’ Even those books that have been written for the nonrecurring arena are based on theory and hypothesis that when tested often creates more waste than it eliminates. In revealing and separating the inevitable exploration and execution phases of nonrecurring processes, we actually flew in the face of a lot of previous advice, which was to overlap the phases and ‘manage the risk’ to generate speed. Having taken both of these approaches, we had to accept that the previous advice seldom worked, and only did so if the project got lucky. Our breakthroughs came when we genuinely asked fundamentally, “what are we trying to flow?”
Rob Westrick: It’s a pretty common expectation, but we’ve found that many lean principles that have worked well in factories, offices, and hospitals do not work in new product development (NPD). This is because NPD projects are all different, even though the process looks the same from a distance, and NPD inherently contains the risk of the unknown. Lean paradigms such as “right first time,” “standard work” for everything, and “just in time” either don’t work or need to be modified to produce results. Waste is also a lot less visible and can masquerade as useful effort even more than in a factory.
We also learned that Six Sigma methodology, with its focus on defect rates, efficiency, and standardization, often misses the huge amount of waste of iterating to a solution late in a NPD project when significant resources have been deployed. Instead, we advocate an initial period of exploration that significantly reduces the risk of the unknown at a time when the project team is relatively small and changes in specification and design are relatively cheap. Once this exploration phase has been completed, then the bulk of the project can be executed in an environment in which the more traditional lean principles are effective.
2. How is the Simpler Design System different from other techniques? How might it benefit medical device manufacturers more than other methods in terms of improving quality, reducing costs, and expediting lead times?
RW: The Simpler Design System uses many techniques, such as voice of the customer, QFD, design failure modes effects analysis [FMEA], A3, design for manufacture, etc., that will be familiar to many involved in NPD. The difference is that we link all of these techniques with the common purpose of revealing unknowns, and creating the knowledge, through learning, to make informed decisions about them. Lean practitioners are always concerned with creating flow. In a factory, this is usually in the form of orders, parts, product, people, etc. It is tempting to think that in NPD what flows are requirements, drawings, reports, and change orders. This may be true toward the end of a project, but Simpler Design System is different in that it concentrates on a flow of learning and decisions in the early stages of NPD. Many medical device manufacturers are often dealing with individual “key opinion leaders” who are highly educated healthcare professionals who may well understand the medical application of new technologies as well as or better than the manufacturers themselves. There are often many key opinion leaders with conflicting views, and NPD projects are often hampered by requirements continuing to evolve throughout the project as more application data are received or technical limitations are discovered.
In addition, healthcare is constantly demanding new technology to improve treatment outcomes, and manufacturers are locked in a technology arms race as they compete to fulfill these needs. Once a promising technology is identified, there is extreme pressure to get it to market, leading to the creation of large teams focused on getting a partially proven concept into production. This leads to significant effort invested in designs that are then changed and iterated under extreme time pressure as problems emerge late in the project.
Simpler Design System has methods for efficiently driving initial learning and decision making using visual tools that will convince even the most task-driven of managers that progress is indeed being made even if there isn’t a full bill of materials or a complete software release created yet.
3. You emphasize two mental phases of the NPD process—exploration and execution—to transform performance and reduce the end-to-end timeline, enhance quality, improve morale, and make cost performance more predictable. How does this differ from other methods?
CC: The idea is not to seek to overlap and introduce the necessary risk management required (nonvalue-added) and not move into definition before fundamentals have been understood. Much of the waste we observed in the traditional improved concurrent approach came from unknowns only becoming known too late in the day. The idea is to prioritize learning and knowledge and defer decisions to as late as possible,which is the opposite of mixing it all up intelligently through traditional project management methods. We found that the higher the level of uncertainty in a project, the less effective traditional project management will be. Also, we found that almost all nonrecurring processes that were documented and defined as a standard by organizations had nothing that covered exploration. This was assumed to be too fuzzy to define.
RW: Many other methods share this same two-phase approach. Indeed the stage-gate approach found in many companies has a “pre-study” and a “realization” phase. The problem is that the pre-study is usually focused on developing requirements and we have found that many companies create these requirements without really challenging their accuracy or stating them in a way that is both quantifiable and testable. Simpler Design System provides the tools and techniques to uncover unknowns and drive the learning required to define the new product and in a way that is both clear and testable. This strategy provides clarity to all involved, which increases the quality of the product, the accuracy of the planning, a reduction in the waste of unclear communication and the resultant iterations, and greatly improves team work and morale. The technique of “team-based project planning” is highly effective and resonates strongly with techniques used in Agile software development.
4. In light of the implementation of the medical device excise tax, medical device manufacturers are facing cuts in R&D and staffing and the delaying of plant expansions. How can your techniques (or perhaps any lean methods) be used to offset these cutbacks?
CC: By reducing waste and nonrecurring costs in the process, organizations can claw back some of what they have lost by the tax. Also, by dramatically improving the design of the actual devices, they can win more market share and grow. It is normal to see timelines cut in half and sales growth of 25% beginning with the first project fusing the [Simpler Design] methods.
5. How quickly might a company see results from lean techniques, when it is already making cuts to offset the tax?
CC: In recurring lean, when practiced well, results can come immediately with only a few failing to see results within a quarter. The real issue in the recurring environment is implementing in a way that actually targets results. Too many of the textbooks suggest lean implementation without regard to the need to create real results. On the nonrecurring side of things, the really big results — reduced solution costs, higher margins, and growth — come once the nonrecurring activity ends, but along the way reduced nonrecurring-costs can be seen very quickly.
RW: Lean techniques in NPD take longer to reach the bottom line of a company than do lean events in manufacturing and operations. However, significant improvements in the time-to-market and quality of new products can be seen within one project cycle and can be well established within a year.