Pipeline Workshops™: Come. Participate. Learn.

Posted June 25, 2017 By Fletcher Groves

In the weeks leading up to a Pipeline workshop™, we explain to builders what is about to happen, we describe the tools that they will have to learn to use, the facts of the business case they will confront, the knowledge they will take away from it, what they should expect to see.

We describe the challenging, disruptive, competitive nature of the learning – the degree of interaction, the level of intensity – they will experience.

At a Pipeline workshop™, it is learn-by-doing, applying production principles and disciplines to production simulation, and measuring the resulting operating performance and economic return.  We communicate our expectation that builders come prepared to learn that way, that there is no place to hide.  Nevertheless, attendees frequently tell us afterward they should have studied more, should have prepared harder, in advance of the workshop.

Brandon Hart, Clark Ellis, and I make no apologies for the extraordinarily demanding nature of a Pipeline workshop™.  It is intended to not just inform your thinking, but also to reform your thinking – to challenge it, to change it.  It is intended to test your understanding of how production systems work and how daily operating decisions drive business outcomes.  As we like to remind builders, there is a difference between being in the home building business, and being in the business of building homes.

So – you have to come to a Pipeline workshop™ prepared for what is going to be thrown at you.

In particular, exploiting the RB Builders: Lessons from the Pipeline© business case study used at every Pipeline workshop™ requires that you have a working knowledge of the following tools:

  • Variable Costing; Contribution Income Statement;  Cost-Volume-Profit (CVP) Analysis
  • Breakeven, on both a price and unit basis
  • DuPont identity for Return on Assets
  • Little’s Law* (for calculating cycle time, work-in-process, and throughput, both periodic and rate)
  • Cost of Variation
  • Theory of Constraints
  • Lean Production
  • Six Sigma

You can read the book.  The Pipeline: A Picture of Homebuilding Production, Second Edition© is usually carried, in stock, on all of the main bookseller websites;  it is also available directly from the publisher’s bookstore (www.virtualbookworm.com).

If you want it all handed to you, don’t bother to attend.  If all you want is binder material you can underline and highlight, and put on your bookshelf, don’t come.  If you aren’t willing to own what you take away from it, a Pipeline workshop™ is not for you.  If you believe improving the margin side of Return on Assets is the only game in town, a Pipeline workshop™ is about a different game.

But, if you are determined to create sustainable competitive separation, by thriving on the velocity side of Return on Assets®, by excelling at a discipline other builders find too difficult, too rigorous, too daunting, then a Pipeline workshop™ is precisely the right place for you to be.

 

Come.  Participate.  Learn.

The next Pipeline workshop™ will be held at the Ponte Vedra Inn and Club, Ponte Vedra Beach, Florida, on October 18-19, 2017.  The cost is $875.00;  the cost during early registration, open through July 17, 2017, is $745.00;  for team pricing, inquire here (flgroves@saiconsulting.com).

Sponsored by BUILDER and BuilderMT.

For more details:  www.buildervelocity.com

*We will help you out a bit on Little’s Law.  Consider this scenario:  C/T=120 days;  WIP=80;  Closings=240.  Little’s Law says:  CT = (WIP ÷ C) x 360;  WIP = (CT x C) ÷ 360;  C = (WIP ÷ CT) x 360.  Therefore:  CT = (80 ÷ 240) x 360 = 120 days;  WIP = (120 x 240) ÷ 360 = 80 units;  C = (80 ÷ 120) x 360 = 240 closings.

 

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Pipeline Workshop™ No. 8: Save the Date

Posted June 18, 2017 By Fletcher Groves

Pipeline Workshop™ No. 8 will be held October 18-19, 2017, at the Ponte Vedra Inn and Club in Ponte Vedra Beach, Florida.  The latest in the series of production management workshops in the open, sponsored Pipeline channel, it is sponsored, once again, by BUILDER and BuilderMT.

“The Pipeline workshop™ was really effective in showing how operational decisions affect business outcomes and how risky a ‘more for more’ approach to growing a home building company really is.  The Pipeline games™ were not only fun, but they were super-effective in showing how unbalancing the production system, managing the constraint resource, and managing the right amount of WIP, creates predictable operational results and maximizes financial outcomes.

“At the end of the day, running a successful business is about how much money you make on the amount of money you invest.  The Pipeline workshop™ helped me understand this better than any workshop or seminar I’ve ever attended.  I highly recommend it.”  (Charles Roberts, Vice President of Operations, Providence Homes, Jacksonville, Florida)

Welcome to the most intense, demanding, interactive, and challenging homebuilding production management learning experience on the planet.

And – it just keeps getting better.

In recent workshops, we lengthened the schedule, enabling us to do more with the deeper-dive velocity accelerators;  for Pipeline Workshop™ No. 8, the four velocity accelerators are Business Process Improvement, Epic Partnering™, Critical Chain Project Management, and OBM/Team-Based Performance Compensation – a good mix of immediately available velocity acceleration, currently possible velocity acceleration, and the future of velocity acceleration.

We continue to refine the scenarios in the Pipeline game™, which is both a production simulator and a business game.  Over the course of all the Pipeline workshops™, we have:  (1) made the game shorter, faster, and easier and quicker to grasp;  (2) switched to an operating statement format that mirrors the attributes of homebuilding operations;  and (3) found ways to transfer the learning and knowledge with fewer games.

Pipeline workshops™ are unlike any other homebuilding conference.

The learning split is 70% simulation/business case, 30% lecture;  the format is intense, interactive and competitive;  the Pipeline game™ production simulations and the RB Builders: Lessons from the Pipeline© business case test attendees’ understanding of production management and challenge their ability to solve production problems.

Pipeline workshops™ build an intuitive, instinctive understanding of production principles and disciplines, and they draw the subtle-yet-crucial distinction between being in the homebuilding business, and being in the business of building homes.

Moreover – we make it all incredibly fun:  the Ponte Vedra Inn and Club is a terrific AAA Five Diamond oceanfront resort venue;  there is a great reception at the end of the first day;  recommendations on outstanding local dining;  plenty of opportunity for networking.

Creating a visual image of homebuilding production;  establishing the connection between operating decisions and business outcomes;  building a new way of thinking systemically towards solving core problems and managing constraints;  managing limited capacity and resources, doing more with less;  dealing with variation;  managing homebuilding production as the multi-project type of workflow that it truly is;  placing the emphasis on the actions that accelerate velocity.

The fundamental proposition of a Pipeline workshop™ is this:  thriving on the velocity side of economic return – thriving on the velocity side of Return on Assets – is the best way to create sustainable competitive separation.

Registration for Pipeline Workshop™ No. 8 opens June 20, 2017.

Come.  Participate.  Learn.

 

In advance, here is the link to the website:  www.buildervelocity.com  When registration opens, so will the event registration and hotel reservation links.  The site also provides information about the workshop, provides reviews from builders who have attended previous workshops, and provides a downloadable Adobe PDF file with detailed information about the venue, agenda, and schedule.

The cost is $875.00 per person;  the cost during early registration (opens June 20, 2017, runs through July 17, 2017) is $745.00;  for team pricing, inquire here (flgroves@saiconsulting.com).

Sponsored by BUILDER and BuilderMT.

 

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(initially published on EFA® in March 2011, republished in March 2013 as the last of a four-part series in the retrospective Above Average: The Best of Escape from Averageness®, 2009-2012, updated and republished here)

I will offer you a couple of final suggestions.

First – the value you deliver to stakeholders is created by the work you do;  that work is often performed in processes;  those processes are part of a business operating model.  So – wherever possible – the other elements of the operating model (its systems, organizational structure, teammates, culture) need to support process design, not vice versa.

Second – knowledge of the design, improvement, and documentation of processes is one matter, knowledge of the management of processes is something altogether different.  In addition to the process areas, a working knowledge of management areas like Six Sigma, Lean Production, and Theory of Constraints and how to effectively blend them – find a way to use the tools that work best without regard to the religion from which they came – is essential when it comes to good process management.

Third – as I mentioned at the outset – you need to be able to distinguish between the areas that need to be managed as processes and the areas that need to be managed as a portfolio of projects, and to operate accordingly;  you would find particularly useful a knowledge of Critical Chain Project Management (CCPM) helpful;  CCPM is part of Goldratt’s Theory of Constraints.

As I noted at the outset, I rarely plug SAI on the pages of this weblog, but this is different.

SAI has done more work with processes – and done it longer – than anyone in the homebuilding industry.  Before the creation of the National Housing Quality (NHQ) Award, we were already assisting Malcolm Baldrige National Quality Award winners in their efforts to refocus, restructure, and redesign their business operations around their processes.  Before there was any interest in the homebuilding industry on the documentation and management of business and operating processes, we were already recognized experts in that field.

Our process toolbox is the best in the industry.  We pioneered the development of many of the tools and techniques we use in this area.  We are a consulting partner with iGrafx, which has some of the most advanced process flowcharting and modeling software available;  we know, because we participated in a part of its development.

We are adept at every form of process documentation, including cross-functional flowcharting, value stream mapping, and IDEF0 process modeling, all of the notation languages, as well as the methodologies – Total Quality Management (TQM), Business Process Improvement (BPI), Process Reengineering, Lean-Six Sigma (LSS), Business Process Modeling and Notation (BPMN), Theory of Constraints (TOC), and Lean/TPS – that act upon them.

But, I will make this offer to you.  Yes – we know what we are talking about.  More importantly, we are willing to talk with you, at no charge, to help you make the right decisions about workflow.

By all means, please take us up on it.  Here is my contact information:

 

      

(initially published on EFA® in March 2011, republished in March 2013 as the third of a four-part series in the retrospective Above Average: The Best of Escape from Averageness®, 2009-2012, updated and republished here)

In terms of resources, there is no single, comprehensive reference or guide to all of the areas of Business Process Improvement.  At SAI, much of what we know, we learned by doing, by seeing what worked – and what did not work – in the real world.

However, most of us who want to learn start with what those who went before us know and took the time to write about.

Here are my book recommendations:

For processes generally, I think Business Process Improvement (Harrington) and Beyond Reengineering (Hammer) are still the best.  Although there is a newer handbook, Harrington is dated because of its TQM approach;  nevertheless, it is a process classic.  Hammer is also dated, but still has the best understanding of enterprise-level processes, if you set aside the focus on reengineering.  Hammer and Champy’s precedent Reengineering the Corporation remains a worthwhile read.

Depending on your level of experience and expertise, you might also pick up The Horizontal Organization (Ostroff) or Process Redesign (Tonner, DeToro).  They have their limitations, but they can help, if you are new to improvement.

For the mapping of processes, I recommend The Basics of Process Mapping (Damelio);  Process Mapping: How to Reengineer Your Business Processes (Hunt);  Workflow Modeling (Sharp, McDermott);  Process Mapping, Process Improvement, and Process Management (Madison);  BPMN Method and Style (Silver);  and The Practical Guide to Business Process Reengineering Using IDEF0 (Feldman).

Damelio covers very basic flowcharting;  Sharp has more of an IT and project perspective, and is better on implementation issues;  Madison is a good practical guide in all three areas in its title;  Silver does a very good job of explaining BPMN 2.0 as an emerging standard.

Hunt and Feldman both cover IDEF0 process modeling, but Hunt covers IDEF0 in a broader, more thorough reengineering context, while Feldman is a more complete guide to IDEF0.

Somewhere in between are books like Improving Performance: Managing the White Space on the Organization Chart (Rummler, Brache), Cycle Time Reduction (Harbour), and Fast Cycle Time (Meyer).  These books tend to focus on processes and process mapping, but usually in the context of their views and methods on their own areas of practice, like strategy and change management.  They are also somewhat older books.

I do not recommend Business Process Mapping: Improving Customer Satisfaction (Jacka, Keller):  the use of interviews instead of cross-functional teams to document workflows;  ineffective process and operating measures;  processes that are not redesigned by the people who actually do the work;  outdated, manual process mapping methods and techniques.

Almost every book ever written about the design, analysis, improvement, and documentation of business processes is in the SAI library, including all of the ones that I recommended.  I have personally read all of them.  The recommendations are not a comprehensive list, nor are they the only worthwhile reading on the subject, but it is a good starting point.

Here are my software recommendations:

As far as business process mapping software, we use and recommend the iGrafx (www.igrafx.com) suite of process applications.  iGrafx applications support a wide range of process methodology, including basic flowcharting, cross-functional flowcharting, BPMN, Six-Sigma (SIPOC) process documentation, IDEF0, Lean Six Sigma, and Lean Value Stream Mapping (VSM).

We are an iGrafx Consulting Partner, not a seller of iGrafx products.

My first recommendation is to find a true, dedicated business process mapping application, not an application that is just a drawing tool (like Microsoft Visio).

There are a number of worthy business process mapping software applications – BizAgi, BizFlow, IDS-Sheer/ARIS, Global 360, Metastorm, others – mostly for very large enterprises, but the differentiator, in my view, is that there are only two software providers – iGrafx and KBSI-Knowledge-Based Systems – that support an IDEF0 process notation and modeling module.

So – my second recommendation is to select a true, dedicated business process mapping application that supports IDEFO process notation and modeling.

Next:  Part IV:  Final Suggestions

 

      

(initially published on EFA® in March 2011, republished in March 2013 as the second of a four-part series in the retrospective Above Average: The Best of Escape from Averageness®, 2009-2012, updated and republished here)

Our proposition regarding processes is very simple:  The goal of an enterprise is to make money;  the way an enterprise makes money is by creating value for its stakeholders, most importantly, its customers;  the way an enterprise creates value is through the work that it does;  that work is performed in some manner of workflow, which involves processes.

For us, understanding workflow is a means to an end.

It is the front-end of a problem-solving methodology, in which we first eliminate the activities, reports, inspections, and other work that is waste (muda), and, therefore, adds no value, and then make the remaining value-adding activities flow more smoothly, more directly.

In our way of explaining production principles, using the analogy of a pipeline, we want a process that is a shorter, straighter pipe.  It is a way of simplifying and streamlining processes, so that our clients can deliver more value from what remains, with the same amount of capacity.

Understanding workflow also tends to clarify the underlying problems and issues, for example, the variation and uncertainty that haunts any production system.  When process workflows are connected to performance measures – to existing performance and targeted performance – clients can start to understand the requirements and necessary conditions that have to exist for the process to be improved.

For the most part, we like to look at the current (AS-IS) state of a process through the lens of cross-functional flowcharting teams, comprised of the people who actually perform the work in the process;  management, we like to remind our clients, at best, only knows how a process is supposed to work.

Before 2000 – before the turn of the century – we would also use cross-functional flowcharting teams to redesign the same process to reflect its desired future (SHOULD-BE) state, because it made comparisons between previous and redesigned states of a process more insightful.

It makes the difference between AS-IS and SHOULD-BE more stark.

We like the starkness.  Now, however, we tend to get to the point more quickly.  We use IDEF0 process modeling in the design/redesign phase, and we document processes in IDEF0 notation.  For continuity, and to take advantage of the insight gained mapping the current state, we use the same cross-functional teams for the SHOULD-BE that we used in the AS-IS;  we just use a different methodology.

The advantage of IDEF0 lies in the ability of its hierarchical structure of graphic diagrams and supporting text diagrams to gradually and infinitely reveal increasing levels of process detail.  Unlike cross-functional flowcharting, SIPOC charts, or value stream mapping, IDEF0 process modeling does not impose a single level of process detail;  the level of detail is whatever is necessary to create the understanding.

As a result, IDEF0 presents a far better learning/training outcome than flowcharting, SIPOC, or value stream mapping.

There are additional advantages to using IDEF0 for designing and documenting the desired future state of a process. Unlike other methods, IDEF0 establishes parameters and outcomes as part of the process design. More importantly from a process design/redesign standpoint, IDEF0 does not carry the legacy – the burden – of the current state, as other methods tend to do.

I would be glad to send, any reader who requests it, the client tutorial we wrote explaining IDEF0 process modeling.

Process design, improvement, and documentation is only half the battle.  There still has to be a way to manage process workflow.  The inability to provide clients with a practical means of automating and managing processes has tended to be a shortcoming of Business Process Improvement (BPI) and Business Process Management (BPM).

There is an emerging standard known as BPMN, (Business Process Modeling and Notation), the promising aspect of which is the ability to automate and manage process steps through execution language.  Some require code to be written, others claim not to require additional code-writing.  The current version (2.0) is more open source and supported by OMG.  The common execution languages that BPMN uses are BPEL, XPDL, and XML.

The significance is that these applications extend process design, improvement, and documentation into process management and automation.  BPMN offers the prospect of process management and automation for the everyday business world.

Like IDEF process notation, BPMN uses a hierarchical, parent-child structure of processes and embedded sub-processes.

Since most of our clients are homebuilding companies, the benefit of automating processes is of less importance than industry verticals that have high-transaction volumes and high-IT components.  For our clients, we would prefer to have whatever automation is needed built into the operating system that supports the process workflow, not the other way around.

Moreover, homebuilding companies, as I said earlier, have to be concerned with project management, not just process management.

 

Next:  Part III:  Recommendations