Identifying Waste to Save Time and Money
Michael Anderson, founder and CEO of BizScale: Cool. Okay, okay. So welcome, Mike, and to the other Ryan, I’m not sure if you’re new to the series, but we started a new BizScale Learning Series back in late January, and the goal of this particular series is really to start with the fundamentals of business, really building a good foundation.
The series we’ll have later in the year will be more strategic” cold emailing, cold outreach, marketing, sales, things like that. We wanted to really kick off the learning series with the start of the year, and doing things like goal-setting and really building a good foundation for the business.
BizScale event house rules
Michael: Just a couple of rules: we are recording this, but it’s for internal use only. We do like to keep these interactive where we hear from you.
Today, we’ll be going through a waste exercise. If you have any examples you can share, that’d be awesome. Treat others with respect, and stay on mute when you’re not speaking.
Michael Anderson (introduction)
Michael: A little bit about myself: I’m the founder of 3 businesses. They’re still active businesses; we’re in growth mode in all of them. It’s been very challenging to have 3 businesses, but part of our success has been really being able to outsource the day-to-day and really focus on the strategic stuff. We’ll dig into that several times over the next couple of months.
I have over 20 years of startup experience. You can see some of the companies I’ve worked at. Personally, I just love startups, so I’ve really enjoyed my time working at the startups.
Passionate about business. My wife thinks I’m obsessed about business, because I just don’t stop thinking about it.; waking up in the middle of the night, taking down notes. Really love helping others, that’s why we’ve started this series, and we really do a lot of work with entrepreneurs on the side.
We’re actually going to start a new Slack group tomorrow, so if anybody’s interested in joining that, you get some free advice, please let me know. And I’m really obsessed with growth hacks and scaling businesses.
Michael: BizScale is a managed services company. Basically, anything that you can outsource, we handle. Accounting, design, branding, website development, we have a very good offering of virtual assistance, both part-time and full-time.
The goal is really to reduce operating costs, increase revenue, and — most importantly for founders and executives — is really freeing up your time to focus on what you do best. Your strategy, your sales, your marketing. Try to offload all the day-to-day work so you can focus on the high-ROI tasks.
Learning events recap
Michael: Just a quick recap of the events so far. So we did a 2020 Lessons Learned, which tied into retrospectives. If you haven’t done one yet for 2020, we highly recommend doing that.
Think about it, we’re almost at the end of February, and it feels like the year has flown by so far. So you really wanna stop, you wanna reflect. I think last year was a very interesting year, one we won’t forget; so really making sure you go through last year, what was working well, what was not working.
We did a SWOT analysis, identifying the strengths, weaknesses, opportunities, and threats. Very good exercise, recommend you go through this at least quarterly — sorry, at least (every) six months, but we do it quarterly.
Last session was on goal setting. We do have a goal-setting template that we’ve shared, so if you’re interested in that, just let me know. This is one of the most important things; if you don’t have that North Star, you don’t really know what you’re working towards.
For someone like myself, I’ve got problems focusing, goal setting, and more importantly, tracking your goals. It’s so important. It’s something I’ve struggled with a lot. I’ve actually had to get help on that, and now we feel like we’re in really good shape and we wanna share that with others. This was just tied into the goal setting, creating an annual plan.
So let’s jump right into it. Sorry, just real quick, I should have done this at the beginning. Mike, I know you’re new, do you mind introducing yourself? Do you have your own business, do you work for somebody else?
Mike: I’m just listening in. Hello, everybody. Mike, from Syracuse.
Michael: Awesome. Welcome, Mike.
Michael: Alright, so let’s jump into it. So, identifying waste. If you haven’t heard of Six Sigma Lean Principles, definitely Google it. It’s really important stuff, because there’s so much waste in what we do, and we’re gonna dig into it.
When you think about waste, there are different types of waste, and it really depends on the type of business that you have. But basically, waste is considered your non-value adding parts of your process, and we’ll get into some specifics.
And then when you remove those, you’re saving time, you’re saving money, but more importantly, you end up improving different parts of your process. So for example, this is a pretty obvious one, but if you have certain bugs in your platform, not only are you wasting time and money, but you’re impacting your customer success, your customer satisfaction.
When you remove the waste, not only do you save time and money, but you also improve the downstream areas that are impacted, so it’s really good.
If you look at number two here (refers to slide), the map value stream, the challenge of the waste exercise is really to put the time up in front, where you’re really digging into your process. So if you’re manufacturing, you really wanna have a specific outline of all the parts of your process, and then you start digging from there.
So first, it’s really outlining your process, and then looking at each area. I’m a visual person, so I’ve always done it in a visual way. You could get away with just doing it on paper in text. But when you lay it out visually, and you can start connecting the different steps in your process, it definitely helps you out a lot.
Okay. Some folks say there’s 7 wastes, we used goleansixsigma.com and they identified 8 different types of wastes here.
So defects, any defects, it could be software, it could be a defect in the process. There’s overproduction, keeping too much inventory on hand, you’re producing more inventory than you actually need.
Waiting, waiting is a big one. I can’t really recall any time that I’ve done this exercise where waiting doesn’t come into play, and of course waiting is tied to cost. When you’re waiting on something, you’re typically incurring some kind of cost or wasting money, so that’s an important one.
Non-utilized talent, I think this is the one where these guys added it in as an 8th one. This one happens internally for us, where you have some folks working on things that they shouldn’t be, or they’re not working on certain areas.
So you have somebody that’s really talented in marketing and they’re doing a sales role, for example. Having a good matrix of your team, and what they’re really good at, what they want to learn, what interests them, goes a long way.
Transportation, one of our other businesses in the landscaping industry, we work with a lot of suppliers where they’re moving material from site to site, and they haven’t really put a cost around that, at least a few of the clients that we have. It’s amazing how much money they spent on fuel and manpower to move material around, and when you take a deeper look, it actually didn’t even make sense for them to move it to that specific location.
There’s, again, inventory, just having too much inventory.
Motion, this one doesn’t come up too much, but I think this could be applied to manufacturing and some other businesses.
And then, extra-processing. It could be repetitive steps, it could be doing things manually when they could be easily automated. I’m a big fan of using technology, either automating things or looking for duplication of work or extra-processing.
Okay, so here’s an example where we went through a waste exercise for a quality assurance team. They were building software, and they had a bunch of different teams, there’s a hundred-person team. And if you’re not familiar with software testing, you basically wanna make sure that you’re creating test cases or test scenarios that cover the flow that your users would cover.
When we dug in, we found out that multiple teams were creating these test cases, and there was this particular team that would write test cases from scratch to create the automation, so what was happening was there was a duplication of work and they didn’t realize it until we started digging in.
It ended up saving 6,000 hours per release. Their release cycle was every 6 months, but still, 6,000 hours is a lot. What happened was that they were able to use that 6,000 hours to actually do more ad-hoc testing and other types of testing, so their quality improved. That was a big one.
There was another one where the developers, as they’re handing off their code to the quality assurance team, they weren’t really describing the impacted areas. So, I’m gonna change ABC and it will impact XYZ. They weren’t doing a good job of documenting this, so the team had to always test very wide, instead of testing narrow, in just the areas that they did.
And again, just like in business, we move so fast, we don’t really have the pause to dig into some of these processes, and that’s why these exercises are so important, and to schedule them on a regular basis, and to spend the time doing it, because in the long run, you’re going to save a lot of time and money. This one, again, we ended up saving a lot of time, and it resulted in higher quality.
And the third one is just some low-hanging fruit, where for some reason or another, only certain members of the QA team had access to the database and the monitoring and logging, and that resulted in sharing of credentials and waiting.
Sometimes, folks would test without looking at the log files, which is not a good thing to do. That resulted in the QA team being able to dig in further into issues and try to identify the root cause, instead of throwing it over the fence to the developers to try and figure that out. That only went with time-saving, but all-around, that was a good improvement.
And then we’ve done several waste exercises. I wanted to share a couple from our business.
One of the things that we struggled with last year was our onboarding process. We’ve been moving between tools and trying different ways to onboard clients, and it was always fragmented. There was a lot of delay, there was duplication of work.
For example, we had a Google Form at one point, then we’d have to take the results of that form and put it into our ticketing system. Once we identified how much time we were wasting in our first case, it was just not a good process for our client, so we looked at that.
Now we have a form that’s built into our task management tool, so that form translates right into tickets that our team picks up, so it’s a very smooth process. We also, at the time that we did it, we realized that it’s very important to be clear on the roles and responsibilities, like who’s doing what in that process.
And then the other one was cross-team collaboration. If you think about marketing or social media, you have the graphic designer, you have the copywriter, you have somebody from marketing, and you need to make sure that there’s good collaboration, that there’s no delays in handoff, and we struggled a bit with that.
Some of it was just growing too quickly, some of it was just not the right tools, right process, so this one was one that moved the needle a lot because it improved the experience for our clients, which is most important. Then of course it just allowed our team to work together in a more streamlined way.
But again, maybe we would have hints of this here and there, and we would say, “Hey this doesn’t feel right.” But you’re so busy, you don’t get to focus on those problems, so it wasn’t until we did our waste exercise that we were really able to drill in and identify what the problems were and come up with some solutions. These are a couple of good examples.
Q&A + Share examples of waste
Michael: I wanted to open it up, well first, to questions. Does anybody have any questions on this one?
Brian, I know you’re kind of just launching now, so you’re a very small team. Sometimes, these exercises — maybe it doesn’t make sense for your business, per se, but on how you work.
Do you spend too much time on things that are not important, for example. I think the waste exercise is good for business, but you can also apply aspects of it to your personal life.
Brian: Yeah, definitely. I was just thinking today about how much time I spend making Instagram stories and then duplicating them on different platforms in different formats, how time consuming that is, and building the Android app at the same time, it’s kind of a lot.
Michael: Yeah, yeah, exactly. Part of that may be you’re not using the right processes for Instagram. There are some hacks there, but I just think it sounds like you have a lot on your plate, and you’re gonna need some help.
But these are really good, I think once you get going, and you get clients, and the team grows a little bit, this could be a valuable exercise that you do 6 months down the road.
Going back here, with the map exercise, especially in manufacturing, I’ve seen people using plotter paper, where they have these huge process maps on the wall because the process is just so lengthy. In those cases, if you haven’t done a waste exercise and
you’re doing it for the first time, it can be time consuming.
You can take, for example, if you had a manufacturing process that had 8 steps, maybe you just look at steps one, two, and three for the first session to do. The waste exercise could take weeks to months to really complete, it depends on — for example, if you go back here, this waste exercise, doing the assessment, mapping out the flow, digging in, that actually took a few weeks to do.
And then what took even longer is actually how to address it. We’ve said this before with the retrospective and the reflecting, identifying what worked well and what didn’t work well is part of it, but then actually doing something about it is the more important piece, so even with the waste exercise, you can identify all this waste, then you also need to spend the time to address it. Depending on what you’re tackling, it may take a while.
And sometimes, people, I won’t say they give up, but it can be a lot of work, but believe me, it’s definitely worth it in the long run.
The other thing is that if you wanna look at software engineering as an example, you can actually do the waste exercise on so many different aspects of software engineering.
You can do it on the testing side, which is what we did for this client, but you can also do it on all the other sides. For the business, for software development itself, the infrastructure team, whatever it is. You can get granular with it, with the waste exercise, and it’s usually a good thing, because you have your higher-level process and then your subprocesses, so you wanna really be able to dig in as far as you can, and sometimes, you wanna have a more narrow focus for that.
Going back here, I don’t wanna put anyone on the spot, but does anybody have any — if you think about your business, or some of your processes, do you have any areas that you feel you may have some waste?
And Brian, not to put you on the spot, but if you have anything, maybe from your past, if you wanna share, that would be great.
Brian: I can think of some current examples. Mostly around — if I had a sign-up form, and then having to copy that data, create a profile for somebody, create an account for somebody. I spend a lot of time using the terminal to de-bug things, when I should set up an admin page to be able to do these things more easily.
There’s a ton of little things that add up, that end up taking, in aggregate, hours of my day.
Michael: Yeah. I just had another session with one of my businesses. Part of it was the operations of the platform. So we get a supplier to register, we wanna be able to send them a welcome email, we wanna be able to easily check their profile to make sure that they’ve uploaded a logo and about us section. If you’re doing all that manually, it does take a lot of time.
Zapier, I’m not sure if you’ve heard of Zapier, and all these other automation tools out there, they’re great for taking some data from one system, putting it into another, or even within one sift, it just automates parts of the process.
Brian, I know you’re a technical guy, I’m sure you’ll figure out how to do that sooner than later. But that’s a great example, because hopefully soon for you, you’re going to have so many registrations that you won’t be able to keep up, so you wanna find ways to reduce the time that you spend on those repetitive tasks.
Brian: Right, yeah. I guess I’m just waiting until they become problems, but they already are.
Michael: Yeah, yeah, exactly. That was one of my issues very early on, where we would kind of treat it like a business that had a hundred thousand users. Trying to automate this and that, when you really don’t wanna spend the time automating unless it becomes a problem where you’re just spending too much of your time.
But once you get those cycles down, and you understand the flow, and you see where you can save some time is definitely worthwhile. For you, it would be great to spend more time coding or reaching out to chefs than having to do that stuff. But again, only when it becomes a problem.
Cool. Well, that’s it, we didn’t really wanna dig in too far here, but hopefully this was enough of an overview for you to look at the different types of wastes. Again, goleansixsigma is a great site for this. There are also sites out there that have different exercises that you can follow to streamline this process.
I haven’t seen any good process flow tools out there, I know there are a lot, but not one that worked very well for us, but I’m sure they're out there. There are a lot of these exercises, a lot of these tools out there where you can use those tools to kind of streamline the process and then, more importantly, to track the results. I definitely encourage you to take a look at some of the different sites out there.
If you’re interested in reaching out, here’s my contact information. All of the decks for the past events, we can share those with you guys, and again, the goal setting template from the last session is also available. Thank you very much.
I’m sure you’ve heard how many people are really expecting a big turnaround in 2021, maybe later in 2021 into 2022. All these are exercises that we have and you really wanna lay that foundation out if you haven’t, because you really wanna get yourself in position for the economic upturn that we’re going to see once we recover from this pandemic.
I’m looking forward to seeing you guys at future events, thank you guys very much for joining, appreciate it.
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