Effective Information Flows

The previous post, Measuring Process Flow, defined the first component of Lada’s Laws as Service Time = Work Time + Wait Time.   This post describes how the ratio between work time and wait time indicates how effectively information is used within an office.

Let’s face it.  Information is lazy.  Billions have been spent on information technologies but no one is able to get the right information at the right time in the right format.

Lada’s Laws are an indicator of information effectiveness.  The Agile and Lean Glossary defines the Lean Ratio as the second component of Lada’s Laws:

Lean Ratio = Service Time / Work Time

Where:

Work Time = The total time it would take to create a product or service if there were no blockages or interruptions

Service Time = The wall clock time to provide a product or service to a customer from initiation to delivery

A Lean ratio of 2 our less indicates the effective use of information within an office.  A Lean ratio of 10 or higher is more typical.  A ratio of this magnitude indicates that even if the people are busy the information is not. 

The Paper Mentality
There are two primary causes of ineffective information:

1)   Processes still conforming to paper-based constraints

2)   Data processing systems

An amazing number of processes are still designed as if paper were the primary transport of data.  This was the case during the 50s when time and motion studies were popular; but not today.  The large investments made in technology have largely eliminated paper.  It’s no longer the preferred transport for information.  Whereas paper is disappearing, paper-based constraints to processes are still prevalent.

One constraint paper placed on processes was to make them serial. It was too expensive to copy paper to make parallel flows.  Since paper was hard to move, batches of work were passed from one person to the next.  The arrival of paper was the equivalent of a baton transfer that indicated a transfer of responsibility for who was to work on it next.  Since it was difficult to predict the arrival of paper, people were given many different tasks to insure they stayed busy.  And once paper started down a process, it was almost impossible to find it until it emerged out the other side.

Today processes are still bound up by these paper-based constraints.  Even though most data now travels electronically.  In fact many processes have worse performance now than they did when they were purely paper-based.

Serial processes are still the norm.  Batches of work must be completed before new work is started.  People keep so many balls in the air that more time is spent juggling than working.  Exception processing and expediting are 80% of the effort not 20%.  And meanwhile, everyone is deluged with data making it harder and harder to find the information they are looking for.

Breaking Free from the Paper Legacy
To achieve a Lean ratio less than 2 requires a clear focus on discarding paper-based constraints.  Lean processes are designed to achieve the continuous flow of information from one customer value added step to the next. 

Parallel processes are used to segregate complexity and reduce service times.  Work is pulled in priority order only when needed so work-in-process is kept to a minimum.  Expediting is eliminated and exceptions are reduced by delivering the right information to the right person at the right time. 

The Lean ratio is easy to measure and gives an organization a clear target to shoot for.  Rather than a goal to work harder or faster, the Lean ratio focuses attention on making information more effective and as a result makes the organization more effective as well.

Measuring Process Flow

The previous post, Measuring Service Time, defined service time as the wall clock time to provide a service from start to finish.  This post describes how to use service time as a measure of process flow.

The productivity of people and tools has dramatically increased over the last 20 years.  Yet with all of that increase in productivity, things still seem to take too long to get done.  The service times of processes have remained stubbornly high.

Traditional process improvement is conducted from the perspective of helping make people more productive.  But what about information?  It’s impossible to perform any process without information.  However, the productivity of information is largely ignored.  In most organizations people are busy but information is lazy.

Why Information is Lazy

To understand why this is true, it is necessary to break service time down into two parts.  The Agile and Lean Glossary defines the first component of Lada’s Law as:

Service Time = Work Time + Wait Time

Where:

Service Time = The wall clock time to provide a product or service to a customer from initiation to delivery

Work Time = The total time it would take to create a product or service if there were no blockages or interruption

Wait Time = The total time a product or service, that is started but not completed, is waiting for any work to be performed

The first component of Lada’s Laws defines the two parts of service time from an information perspective rather than a people perspective.

For example, consider the following process:

1.   A service request is received via email

2.   Information about the request is entered into a database

3.   Phone calls are made to gather additional information about the request

4.   The additional information is entered into the database

5.   It is determined which resources are necessary to complete the request

6.   The request is sent for fulfillment

 

For the above example process there are periods of time when someone is working on the service request (work time), followed by periods of time when the request is waiting for someone to work on it.  From the perspective of the request’s information, it is alternately waiting and then being worked.  For this process the wait/work cycle repeats at least 5 times.

From the perspective of the individual handling the request, they never wait. They work on multiple service requests, one at a time, each at a different step in the process.  The individuals performing this work have very little non-value added time.

It is a different story from the perspective of the service request.  Whereas the people are busy, the information about the service request is very lazy.

 

Making Information as Busy as People

Let’s define the following for the process above:

• The average work time to complete the process above for one service request (work time) is .5 hours
• Each person averages a throughput of 2 service requests per hour
• At any point in time each person is assigned an average of 15 service requests; their work-in-process (WIP)

Little’s Law establishes that Work-in-Process = Service Time * Throughput.  Since Service Time = Work Time + Wait time, the average wait time for a service request is 7 hours; [(13 / 2) - .5].

Based on this information the people performing the process are very efficient.  Their average work time equals their average throughput.  

However, the service request information is very lazy.  For just this segment of the process, the average service time is 7.5 hours.  This means that if you put a tag on a service request that entered the process, that same tagged service request would exit the process an average 7.5 hours later.

For that same tagged service request, someone is actually only working on it for a total of .5 hours.  For the 7.5 hours our tagged service request is working its way through the process, it is sitting around doing nothing for 7 of those hours.  How lazy can it be?

The invention of Lean is how to make information just as busy and productive as the people of a process.  Lean does this without adding more people or more automation.  It just requires some process design changes.

The next post, Effective Information Flows, describes how the ratio between work time and wait time indicates the effectiveness of information flows.