Survival of the Leanest.
Published on Wed, 12/19/2018 - 2:58pm
By Michael Cox for American Dairymen.
Allen Bonthius is not your stereotypical dairy industry representative. For one thing, he doesn’t own any cows and has no plans to own cows in future. In fact, his primary job is as an agri-equipment sales representative.
He’s an interesting person, in part because of his infatuation with, as he calls it, “an intriguing resurgence” of a management philosophy that he believes has the potential to transform and improve dairy farms across the nation. That management philosophy is called ‘Lean Manufacturing’ and Bonthius, who spoke at this year’s ‘Great Lakes Regional Dairy Conference’, is just one of an ever-growing number of enthusiastic promotors of this unique style of management. American Dairymen Magazine recently caught up with Bonthius to learn more about Lean Manufacturing.
Lean Manufacturing is a system of managing business operations that was first introduced and developed by the Toyota Company in Japan. Lean focuses on reducing waste, improving efficiencies and empowering employees; all of which adds greatly to the bottom line. Although Lean principles have been around since the 1980s, the system is not widely used across industries, particularly dairy farms. It’s rarity however does not diminish its validity, and the merits of Lean leave a lasting impression on those who are open to embracing the principles, such as Bonthius.
More than just SOPs
“People’s eyes glaze over when we start talking about management and SOPs,” says Bonthius, who runs a non-profit Lean consulting side-business, “But Lean Manufacturing offers something practical, simple and engaging that anyone can start to implement and benefit from.” While Lean comprises of several different components such as 6 Sigma (Sort, Set, Shine, Standardize, Sustain, Safety) and The Eight Types of Waste (Defects, Excess Processing, Overproduction, Waiting, Inventory, Moving, Motion, Non-Utilized Talent), Bonthius believes dairymen can start utilizing Lean in as simple a manner as possible. “Three simple steps is all it takes to get started in Lean; create a visual step process for a task, introduce a quick daily morning meeting to discuss improvements and create a Value Stream Map,” says Bonthius. Dairies can be busy workplaces and finding time to involve staff in these three steps can be challenging, but Bonthius believes a strong collective focus is key to achieving the efficiency and profit gains Lean has to offer. “Lean is almost guaranteed to bring time and input efficiencies and greater profitability, but it needs full commitment from owners and management so that employees buy into the philosophy and it becomes a way of thinking,” Bonthius says. Employee input and participation is crucial to the success of Lean, as the people at the cold-face of the dairy have the knowledge and power to bring about improvements. Once employees see that owners and senior management are fully engaged and supportive of employee ideas and contributions, the real benefits of Lean will flourish and the workday will become less ‘fire-fighting’ and more streamlined and efficient.
Step 1 in Bonthius’ simple introduction to Lean involves drawing up a step by step, one-page visual guide on how to do a particular task on the farm. The guide should include the schedule for how frequently the task will be performed and a roster of people involved. “Without a doubt the best place to start is in the restroom,” Bonthius says, “We need to start at the simplest place that effects everyone on the dairy and expand the process from there.” Starting with a visual guide and roster for cleaning the restroom sets the tone for Lean; that everyone is involved (including owners) and that Lean will benefit everyone, provided full engagement is achieved.
Step 2 is based on a daily morning meeting with the team. This should be a short, sharp, snappy meeting of about 5 to 10 minutes. In this meeting the owner/manager can mention the 8 types of waste briefly, talk about the processes written up from Step 1, praise what success Step 1 has achieved and any suggestions for improvements and finally plan out the rest of the day. Consistency is key to achieving buy-in from the team, so it is important that meetings start and end on time, people arrive for the meeting on time and also that the meeting is used to highlight urgent issues for the day. “Team members need to mention urgent issues every morning so that they can be planned for and dealt with during the day,” Bonthius says. Quickly discussing the daily problems/breakages/maintenance in-front of the team will alert everyone and allow more efficient planning of the day.
Step 3 creates the Value Stream Map; a visual step by step diagram of where value lies in a task. For example, in calf feeding, the value is only the milk in-front of the calf. All other steps involved before and after putting milk in-front of the calf is not value and should be scrutinized for waste and inefficiencies, e.g. transporting milk. In Toyota, the value stream map focusses on the customer, so on farms, dairymen need to ask themselves who their customer is? “The customer is the cow and the calf, not the consumer,” Bonthius says. He believes that the consumer is too far removed from the team to have significant credibility, whereas treating the cows and calves as our customers creates more engagement and connection in delivering value to these customers. In the Value Stream Map, the aim is to provide maximum value to the customer with as few inputs as possible. Unnecessary steps should be eliminated or reduced. “The team, and not the dairy owner, are the people that will come up with ways to simplify the tasks and make them easier and more value added,” Bonthius says. Staff should be allocated short periods of time in groups or individually to assess a particular task and come up with ways of saving time and inputs, while delivering value to the ‘customer’.
Although Lean Manufacturing systems can seem daunting and time-consuming at first glance, the benefits from committing to the system are often staggering. Several business-support institutions and consultants across the country offer support and guidance to people starting out on their Lean journey. Local support measures and information can be found through a quick Google search. For those of us who’s first reaction is, “I don’t have time for Lean and all this employee engagement,” perhaps we should reconsider our position and ask ourselves why don’t we have time for Lean, and are our employees contributing to business improvements or merely completing routine tasks?
So why isn’t Lean Manufacturing more common across industries, particularly if it has worked so successfully in companies such as Toyota? Bonthius believes that business owners can be afraid to ask for help, especially from their employees. Some owners feel they should know all the answers, while others let their egos get in the way of business improvements. An unwillingness to change and to do things ‘the way Dad did’ is also a common stumbling block in the agri-industry. “But the reality is that the dairy industry has been in an almost straight-line consolidation since the 1930s, with Wisconsin dairies for example, declining from 130,000 to just 9,000 farms today,” Bonthius says. As with all industry consolidations, the strongest take out the weakest performers over time. It truly is a case of adapt to an ever-changing industry or die(consolidate). For dairies, Lean Manufacturing principles offer not only a lifeline for survival, but a basis of continuous future success, but only to those who are willing to embrace improvement and adapt.