What IS for the Lean company, by Pierre Delort at the Lean IT Summit

Lean IS, IS for Lean, both ?
Pierre Delort, Ph.D.
President of the French Association of CIOs
ANDSI
Association Nationale des DSI
www.andsi.fr

© Pierre Delort 2013

1

Lean Management and me
1.  Generali Proximité Assurance (GPA) – corporate organisation
manager ;
2.  Researcher at Mines ParisTech, a French Engineering
School ;
3.  (first) CIO of Réseau Ferré de France (French Railways
Infrastructure Manager) ;
4.  CIO of Inserm (the French Research Institute in Biosciences)
& President of the French Association of CIOs (ANDSI,
Association Nationale des DSI, www.andsi.fr)
2

Generali Proximité Assurance (GPA), Fall 1991.


3

Four years after, IBM’s users conference, 1995.


4

The transformation of the Back Offices


5

Results for GPA & me
Productivity (about) :
• -25/-35% (underwriters)
• -50% (management, employees)
Cycle time : -50%

Ph.D. in Business Administration
Research Center for Scientific
Business Administration


6

The past : production systems history
c. 1700 Similar Design
c. 1760 spare parts
c. 1770 standard design
c. 1800 interchangeability
c. 1850 standard parts AMPS
c. 1900 standard operations
1908 continuous flow
1913 assembly line
From c.1950 TPS


Lean

7

The Future : Economics

Information vs. Institution,
Workflow, Lean Management and Governance of the Firm.
Mines Paris Tech, 1997.

8

And I was able to understand (and teach) the reasons of our gains at GPA


“The [NPS] consultants must persuade workers that men
are, by nature, multi-talented and that superiors that do not
use all these talents are bad superiors. » Conversation with
M. Ohno, in Shinohara I., NPS : New Production System
1985).

9

CIO of Réseau Ferré de France : less Muda…
RFF Investment (€4
b/y), from 7 to 2
applications ;
• 

less data entry

(SNCF Region was
input 12 times on
average)

•  fewer errors,
•  Less Muda….
•  …. but also less
adaptability.

10

…and leaner processes
Shorten the process (1 person
instead of 2) by putting the project
manager in front of the PC,
through ;
•  visual Management of its
portfolio of project ;
•  Economy of vigilance with
Alerters (on budget, cost & time) ;
•  And a thorough ergonomics
design…
•  … for leaner processes &
operations.

This lead me to a question ;

how IS can foster Lean Management in a firm ?

11

And in 2011 I proposed then carried out a study at the Cigref.
1.  is Lean management applicable to an IS Department (Lean for IS ) ?
A.  IT operation ;
B.  Software development.
2.  can an IS Department foster or induce Lean in the Business (IS for Lean) ?
3.  and finally, does the Lean has a role to play in the digital transformation of
Business (Lean for IS for Business) ?
http://www.cigref.fr/quel-si-pour-la-firme-lean

The working group set its own definition of Lean, based on 6 principles ;
 
 
 
 

Process improvement (lead time & Just in time) ;
PDCA, standardization of operations (production adaptability & multi skilled operators) ;
Visual management, problem solving ;
New management system.


12

Q1/A : Lean & IT operations
IT#spending#breakdown#
3%#

Infrastructure :
~30 hardware & software
~20 staff

Aministra1on#
25%#

54%#

18%#

Applica1on#
development#
Applica1on#
maintenance#
Source ; Making IT Operations Lean, Mc Kinsey, Chartrin C. & all

•  More efficient Datacenters ;
  To rationalise the datacenters

(less centers and less servers) ;
  To externalize the centers (=
offshore) ;
  To manage the operations « Lean »

From the study, the gains :
Quality 20-30% ;
  Cycle time 30-50% ;
  Productivity 10-30%.
these figures are consistent with my experience in
Insurance back offices & Ph.D work
 

13

Q1/B : Lean & Software Development
Lean at Wipro (Upton & Staats, HBR, 2006) after two years ;
•  no noticeable increase in productivity ;
•  better integration (less replanning) of the volatility of the specifications.
We learned that Lean Software Development is based on :
•  Just in Time ;
•  Standardization of Operations (catalogue of services) ;
•  production adaptability (Increase the polyvalence of the staff through skill matrix…) ;
•  Visual management (stand-up meetings, Obeya…) ;
•  Problem solving (A3…) ;
•  New governance.
The lean deployment must be progressive :
•  including local experiments using such methods as “agile”,
•  And investing in task management or existing processes documentation.

14

Q2 : IS for Lean - Toyota Motor Europe (TME) IS Dept
The principles :
•  Hoshin Kanri ; a clear direction ; individual objectives relevant and coming from the company
strategy ;
•  A management of Processes and process results with (systematic) PDCA ;
•  The IS Dept has an a complementary approach to strategic and practical objectives and it focuses
more on what the company needs, rather than on users’ requests ;
•  A strong process focus ("fix Business process first") : Toyota thinks process, IT prototypes can be
made for a section or segment of business for future automation ; what is important is the new
process.
The IS Dept manages a plan (medium term) which includes :
•  Communication ;
•  needs identification ;
•  synthesis and consensus building ;
•  Its role in "Business kaizen" runs deep, because its business partners (Marketing, Sales…) are
maybe less familiar with the TPS than the production Dept of the company.

15

Case study ; Process Change Request (PCR)
PCR=improvement to the business process proposed by a supplier (with gain
sharing) and approved by TME :
The Process performances ;
  30% of the requests lost per year ;
  a long cycle-time (110 days) ; objective -30 days for the cost-down PCR ;
  Multiple interpretations and implementation of the process across Europe ;
  No visualization of PCR status across Europe.
The main targets for improvement ;
  No more lost PCR ;
  Cycle time -30% ;
  Eliminate administrative work for registration, handling & forwarding.

16

Case study ; the PCR project
A c. 9 month project, outsourced (Turkish firm) for about 400 k€
1. Requirement ; c. 5 month, in Nemawashi (Business & IT) leads to an A3 (Ringi)
composed of ; context of the decision, current situation & problems, target situation and
improvements sought after, costs incurred and benefits expected, project organization,
position in relation to the (long term) Strategic Action Plan, expected ROI…

A project under control (part of the A3) :


Jidoka

• 

Heijunka

2.Design ;
3.Construct ;
4. Test.

Twice a week

• 
• 
• 

17

Case study ; results & conclusion
PDCA is for real, the results include :
• 
• 
• 
• 

an end to the losses of requests ;
no cycle-time reduction (in fact a slight increase…) ;
a common process + visualization of PCR status ;
some reduction of administrative workload.

As a conclusion the Business Case shows that inducing Lean is based on :
1.  Designing simultaneously the process & the application ;
2.  Keeping the decisions in line with the long-term strategy ;
3.  a very specific organization of the "Software Development" function, including Business
partners, suppliers….
Personally, I didn't really find the answer to my question ; how IS can induce Lean ?
But my question became more specific (something like) ; which application ergonomic can induce Lean ? …
… and Pierre Masai (TME CIO) told me that our study could be used for internal training at Toyota.

18

Q3 ; Lean and (Big data) digital transformation
We defined the digital
transformation of the
firm as the one driven
by Big Data.
We took the example of
what Big Data* has
transformed in
Research :
•  the core process ;
•  the skills…
http://www.andsi.fr/tag/dsi-big-data/

*Induction on a massive scale using data with Low information density, cf.
lecercle.lesechos.fr/entrepreneur/tendances-innovation/221169222/big-data-low19
density-data-faible-densite-information-com

Big Data could need Lean
We assessed that Lean will be
useful, during the
transformation, to keep the firm
focused on customer, processes
and information flows.
We concluded with :
Lean brings a managerial
discipline into the
transformations of Big Data.
«Lean for IS for Business»


http://www.andsi.fr/tag/chief-data-officer/

20

Conclusion ; Three new questions
1.  What is the role of ergonomics to induce lean in businesses
(IS for Lean) ?
2.  Is the development model of some software players like
Google an effective component of the digital business ?
3.  Among the different models of software development, which
one to choose depending of Business issues ?

And there is a follow-up…..

21

Follow up
ANDSI’s Exploration Cycle : Software Asset Building (SAB) ;
•  Google-like (dec 2012) ;
•  Agile (jun 2013) ;
•  Lean (looking for ; pdt@andsi.fr) ;
•  Waterfall ;
•  Versioning.
To understand some relationship between :
•  Business features ;
•  The relevant SAB style.

http://www.andsi.fr/tag/software-asset-building/

22

Thank you

Does anyone have any questions for my answers ?
Henry K.


23

What IS for the Lean company, by Pierre Delort at the Lean IT Summit

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What IS for the Lean company, by Pierre Delort at the Lean IT Summit