Wednesday, May 28, 2008

Root Cause Analysis, Part 2

Photos from http://www.csititanic.com/.



In an earlier post, I used the 5-why technique to determine the root cause of the RMS Titanic hitting an iceberg: communication error between the watchman and his officer regarding the availability of binoculars. While this is truly a root cause, it doesn't inform us why the Titanic, billed to be "unsinkable," sank in less than three hours once it hit the iceberg. So the next question is, once it hit the iceberg, why 1, why did it sink so quickly?


The answer to this first why unfolds in a new book called "What really sank the Titanic." In it, the authors present results of submarine recon showing the ship sank so quickly due to rivets popping along the six slits opened in the seams on the bow of the Titanic. So the next question, why 2, is why did the rivets pop?

Research indicates that the rivets used were poorer quality than standard, causing an easy fracture path for failure. The research was conducted on many rivet samples retrieved from the shipwreck site. Photomicrographs show the phosphate and sulphate inclusion level in these iron rivets is excessive, leading to a weaker fastening of the ship. You can see this on the scanning electron micrograph, shown below from www.csititanic.com, which shows a long slag inclusion provided a fracture path for this rivet's failure.


So the next question, why 3, is why the poor quality rivets were used?


These lower quality rivets were used because of a scarce supply of top quality rivets. Research on meeting minutes cites repeated references to shortages of "best best" quality rivets. So the next question, why 4, is why there was a scarce supply?

The shipbuilder, Harland & Wolff, was building three ships the size of Titanic at the same time. The Britannic and the Gigantic were ships in the same series as the Titanic, and all three were under construction at the same time. Which begs the final question, why 5, why were they building three huge ships at once?

This was a policy decision made by managers at Harland and Wolff. The basic motivator is the drive for profits which, in this case, trumped the need for quality. So to avoid the sinking of the Titanic, an executive at Harland and Wolff would have had to say, “no, we cannot meet this schedule and build the three ships safely with materials that are currently available, so we must delay one or two of the ships.” This would have allowed proper materials to be used and would have saved 1520 lives.

This analysis shows that most problems are the cause of policy decisions and ineffective management, not workers like watchmen or riveters. It was an officer who didn’t supply the binoculars, it was an executive who specified the wrong rivets rather than changing the schedule.
The root cause of the Titanic's sinking so quickly was an executive decision far removed from the sinking, both in space and time; As Deming said, “The problem is at the top, management is the problem.”

Friday, May 23, 2008

Lean @ Home



We use lean manufacturing principles at work, and they provide huge benefits. Why don't we have a "Lean @ Home" program? What would that look like?


According to the National Bestseller, The Machine that Changed the World, lean principles include



  • Teamwork

  • Communication

  • Efficient use of resources and elimination of waste

  • Continuous improvement


Teamwork


A team can take a huge leap forward in performance by simply clearly committing to work toward the common goal. Understanding others’ points of view is sometimes required before moving forward. Sometimes roles must be clarified. At home, teamwork is very important. Working together with the family toward common goals is an important concept. The goals can include financial, educational, spiritual, social, physical fitness, organizing the home, and many others. By agreeing and setting goals, groups living at home move toward success.


Communication


Many problems find their root cause in poor communication. In today's world of high technology, there is no excuse for poor communication. At home, we can use e-mail, voice mail, notes on the fridge, and best but maybe least used: talking face to face. Communication is key to achieving a lean home.


Efficient use of resources and elimination of waste


The objective of a lean system is to identify and eliminate waste. There are seven areas of waste identified in the Toyota Production System:



  1. overproduction,

  2. waiting,

  3. transporting,

  4. inappropriate processing,

  5. excessive inventory,

  6. motion,

  7. defects.

Translating this into the home, the wastes become



  1. bad habits occupying time,

  2. non-useful idle time,

  3. commute time,

  4. inefficient methods, including wasted energy

  5. hoarding,

  6. extra steps,

  7. errors.

Continuous Improvement


A key hallmark of continuous improvement is having a system in place to root out problems, discovering and solving them before they impose themselves on you. These systems function well in good companies, and they can save your home life from excessive waste.


Tools used in creating lean enterprises can be adjusted to develop lean homes. The effort is underway at our house and I will update this blog with lessons on the journey.

Wednesday, May 21, 2008

Root Cause Analysis






The RMS Titanic steamed out of Southampton England en route to New York on April 10th of 1912. This luxury liner was billed to be practically unsinkable. It struck an iceberg at 11:40 PM April 14th and sank 2:40 later. 1,520 lives were lost. This wasn’t the largest loss of life in a maritime disaster, but the Titanic still captures our imagination to this day. In fact, a recent book is out discussing the cause of the sinking. The book, called “What really sank the titanic,” is based on research conducted on samples taken from the shipwreck. I provided an earlier look at this issue, discussing how initial problems evolved into a catastrophic loss of life.


In a different angle, I looked at the root cause of the sinking, and found that Dr. W. Edwards Deming was right, yet again, when he said, "The problem is at the top. Management is the problem."


I performed a root cause analysis on the Titanic's sinking. Using the 5-Why approach, here is what I found. There are two branches to explore, first, why did the Titanic strike an iceberg at all, and second, why did it sink from the collision? This Blog entry is about the first question.

· Why 1: Why did the Titanic hit an iceberg?
o Standard operating procedures at that time for ice fields: post watchman and carry on.

· Why 2: Why did the watchman see the iceberg too late? Conditions:
o “Flat calm,” cloudless sky, 31 F. Watchmen looked for the white foam of waves crashing on icebergs' bases. That night, there were no waves.
o Moonless night: difficult to see anything.
o Not ideal conditions to see icebergs, but was the Titanic not to travel in these flat seas?
o Yes, it should be able to steam in these conditions. Since we can’t control the conditions, let’s step back up and ask why the watchmen failed to see the berg until it was too late. Did the watchman have standard tools, like binoculars?

· Why 2/B No. Why didn’t the watchman have binoculars to see in poor conditions?
o He was told they didn’t have them by an officer, even though there were two pair in the bridge.

· Why 3: Why denied?
o The officer didn't know or didn't care enough to find out. In essence, this is poor communication.

· Why 4: Why poor communication?
o If we answer this, we know why the Titanic hit the iceberg: root cause was poor communication between the watchman and the officer.


It could have been that the officer didn't know or didn't care. Either way, we are getting to the root cause. Let's say the officer didn't know...


  • Why 5: why didn't the officer know about binoculars on the bridge?


  • Poor training, new ship, lack of leadership and awareness... these are the problems, as Deming said, "at the top."


So we see, it wasn't that the watchman did a poor job, it was that he was not supported by the management system. This failure led to the Titanic striking an iceberg on its maiden voyage. Next we'll ask why the ship, described as "practically unsinkable," sank so quickly once it hit.

Monday, May 12, 2008

Profitable Ideas

People wonder if ideas can make money -- yes, there are profits in ideas. Take personal investing, for example. Investing in the right security yields profits. Essentially, we have the equation


Good Idea + Investment = Profit.


There are millions of "good ideas" on how to invest money, and often people hire experts to provide them with investment ideas (stock broker, financial planner, etc.). One problem with this arrangement is that often the expert "hired" really works for a firm who sells investments. Clients wonder, "Who holds sway over this expert, me the client -- or the firm, his employer?" Conflicts of interest occur. For those like me who are self-reliant and don't mind simple online research, I developed a system that generates good investment ideas using free online tools. The method solves the conflict, removing it from clients' worries.


First, I advocate the value investment philosophy proven effective by such icons as Warren Buffett and Benjamin Graham. I recommend reading Graham's book, The Intelligent Investor.

Grounded in the knowledge of how value investing works, you can begin searching for profitable ideas. In Graham's day, people pored over printed materials. One beautiful thing about investing today is that there are so many new tools to get results. I use an advanced, free stock screening tool. I use screening parameters I developed based on the value philosophy and generate lists of potential investments. I take those results to information boards, such as Yahoo's finance page for more detailed analysis of companies I like. Once I gain the knowledge of the business and confirm that it is worth the investment, I place the trade myself. I monitor the results and have a target sales price on the up and down side.


This method generates profits from ideas, true idea power. The key is establishing optimal parameters and maximizing your profit. I will share my stock screening parameters soon, a quick "how to" for today's value investor, but am also interested in other views, so comments are encouraged!

Check back soon for links to my course on value investing, how to pick winning investments, which is under revision temporarily.

Friday, May 9, 2008

Effective Meeting Course


Learn to run meetings effectively -- guaranteed. Follow the methods and make your meeting time more productive and be a star. Based on my research and over 20 years experience, this course will provide you with the tools you need to:


  • decide if a meeting is necessary and elminate bad ones

  • plan effectively for a meeting

  • execute an effective meeting

  • write an effective report
  • effectively run a virtual meeting

In this four-part class you will learn how to shine as a star in meeting effectiveness.


I use Digital Chalk to present my course. Click here to create a new account and register for the course. Complete four sessions, pass the exam with at least 70%, and receive a certificate of completion. Upon completion, you will also receive a .pdf checklist to use for future reference as you plan for effective meetings.


Use your new skills immediately to improve your results, get noticed: a great investment at $59.00. Guarantee: if you pass the class, implement the methods, and are not satisfied with your results, you will receive a full refund.