August, 2008

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Article Index

Lean Leader of the Month
Article by: Manufacturers Alliance
Linda May Hansen, Quality Auditor at Immedia Inc. Immedia Inc. designs, engineers, prints, fabricates, forms and kits point of purchase signs, displays and fixtures.
Legal Corner: The Employee Free Choice Act
Article by: Gregory Peters
Many of you have seen recent commercials and other advertisements about the Employee Free Choice Act, ("EFCA") or "employee voice" in the workplace.
Book Review: Confronting the Threat of an Aging Workforce*
Article by: John Hehre
It seems ironic to worry about losing employees during a time of rising unemployment.
MN Economic Outlook
Article by: Dr. Ernest Goss
For the month of August 2008, reported September 2, 2008. For the fifth time in 2008, Minnesota's Business Conditions Index slipped below growth neutral.
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Lean Leader of the Month
Linda May Hansen, Quality Auditor at Immedia Inc. Immedia Inc. designs, engineers, prints, fabricates, forms and kits point of purchase signs, displays and fixtures.

Immedia sells directly on a national basis to retail chains of 50 or more and to brand marketers. They are also ISO 9001 certified as well as G7 Color Management Qualified.

Why did you decide to enroll in the Lean Leader Certification? Immedia has been actively involved in Lean for 3 years and ISO for 8 years. We recently decided to pull Lean and ISO into one initiative. With that in mind, we are revitalizing and strengthening our Lean objectives to continue to drive standard work and change as well as maintain our repeatability and reproducibility to conform within the ISO structure. To facilitate that goal achievement, Immedia determined a success factor would be the Lean Leader Certification through Manufacturers Alliance. I am excited to be chosen for that role.

What were the lessons learned from leading or training your team on a lean manufacturing project? We decided to start with some basic train-the-trainer sessions, which I led and trained a group of 5. I was surprised that the lessons learned from that training were similar to our lessons learned from Kaizen events.
  • Determine your standard work, supervisors need to audit for compliance.

  • Proper planning and continued training is key to all lean initiatives.

  • Communication is more than just verbal; it must be seen and felt to be successful.

  • Solid and continual support and feedback is essential for any lean initiative.

  • Continuous improvement has to be part of the culture to truly embrace Lean.

Would you recommend others enroll and if so what would you say to describe the training the Manufacturers Alliance has to offer? I would definitely recommend others attend the Lean Leaders Certification Program.
  • The program focuses on several areas that traditional Lean training does not. One example is the Leaders Standard Work course which included a lot of common sense as well as a structured approach to follow. It is truly a component of success no matter where you are at in your Lean Journey!

  • The instructors work in the manufacturing environment just like the attendees, so their insight and knowledge is worth as much as the course material.

  • The courses are broken into manageable components for busy businesses and the prices are very reasonable (rather than going to an independent Lean consulting firm).

  • In every class I have attended, I have met other attendees and found the networking and information sharing beneficial and it is built into all the coursework.
The mission of the Manufacturers Alliance is to provide peer-to-peer training, education, and resources which inspire manufacturing companies to continuously grow, improve, and stay competitive.

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Legal Corner: The Employee Free Choice Act
Many of you have seen recent commercials and other advertisements about the Employee Free Choice Act, ("EFCA") or "employee voice" in the workplace.

You may have questions about the terms of the proposal and how it would affect a manufacturing business.

In March of 2007, the U.S. House of Representatives passed the EFCA (HR 800). Minnesota Representatives cast votes along party lines. The bill then became stalled in the Senate after President Bush threatened a veto, and it has not been brought to the Senate floor. http://www.govtrack.us/congress/bill.xpd?bill=h110-800 contains the bill's text and history.

Currently, the bill is being pushed more strongly than any labor initiative in the past 25 years, and could represent a radical change to the Depression-era National Labor Relations Act. It may also result in automatic union organizing in a wide range of industries, including manufacturing.

In essence, the bill eliminates secret ballot elections in the workplace. Rather than have an election to see if the employees want to be represented by a union, the union would only have to show that a majority of the employees had signed an "authorization card," which indicates an interest in the union. Currently, authorization cards are commonly used to request an election, Signatures on cards may be obtained by various methods of persuasion, with union organizers looking over employees' shoulders. Once a card is signed by an employee, that employee cannot change his or her mind and request the card back. Under current law, authorization cards are kept confidential by the NLRB, and are almost impossible for an employer (or employee) to challenge, unless there is evidence of forgery. The EFCA has raised fears by employers that employees will be misled or coerced into signing the cards, with no real way of remedying or challenging the authenticity of the card. Unions and labor advocates have countered that the current election system is broken, and that employers exert too much influence over their employees' votes, although the election campaign rules have been essentially unchanged for 75 years.

A second major component of the EFCA is a limit on the duration of negotiations once a union is recognized. Under current law, the only legal requirement in the bargaining process is that the parties engage in good-faith bargaining. Neither is required to agree to any particular term. There is no requirement that a contract ever be reached. The EFCA would put a 120-day limit (including 30 days with a mediator) on bargaining, after which the matter would automatically be referred to "interest arbitration." The government arbitrator might then impose terms of a collective bargaining agreement on the parties after a hearing. Neither party could challenge the arbitrator's ruling and the contract would last for two years. Labor advocates claim that this is necessary because employers have delayed negotiations under current law in order to avoid ever reaching an agreement. Employers and their advocates are understandably nervous about government-appointed arbitrators telling them how to run their businesses, and imposing contracts and costs for which they are not responsible.

Regardless of one's view of the merits of the EFCA, there is no question that it may result in higher unionization levels. In recent years, many owners, managers and human resource professionals have assumed that unions were a thing of the past. However, the EFCA could dramatically alter the playing field.
Gregory L. Peters, is an attorney with Seaton, Peters & Revnew, P.A. whose practice is limited to representing employers in labor and employment matters. Mr. Peters has worked with companies in all areas of employment counseling, employment litigation, labor arbitration, union organizing and labor negotiations. Mr. Peters can be reached at (952) 921-4607.

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Book Review: Confronting the Threat of an Aging Workforce*
It seems ironic to worry about losing employees during a time of rising unemployment.

Nonetheless, as the baby boomer generation gets older and retires, decades of often critical knowledge will leave their organizations with them.

Several factors compound this problem. First, technology has changed dramatically over the past twenty to thirty years and much of the development work was done by this group of people. Second, the sheer number of people in this category suggests that the attrition rate will be significantly higher than in the past. Finally, this older generation tended to stay with one company far longer than the younger generations do, increasing the amount of knowledge they possess. Current economic conditions may delay this exodus but the results are inevitable.

Lost Knowledge covers the issues associated with this problem in a very comprehensive fashion. The book is divided into three main sections. The first part describes the high costs associated with losing intellectual capital. DeLong develops definitions for the different kinds of knowledge, describes in detail the impact of losing this knowledge from both an operational and strategic perspective, and lays out a framework for action.

The second part of the book provides a framework for evaluating a firm's practices in the following areas: developing an HR infrastructure for retaining knowledge, improving the transfer of various different kinds of knowledge, applying information technology to capture, store and share intellectual capital, and some suggestions for recovering the knowledge once it is gone.

The last section of the book provides recommendations for developing and implementing strategies for retaining the knowledge.

DeLong argues very convincingly that this is a critical operational and strategic problem facing both industry and government. Through the use of extensive examples, he illustrates both the results of ignoring the problem as well as programs developed by organizations that have successfully addressed it.

The book is a bit dense; it reads more like an academic textbook than a classic business novel. At times the examples and some of the content seems repetitive. Nonetheless, if you are facing this issue, especially if top management is resisting efforts to attack it, the book will provide a detailed and comprehensive way to make the case for action and the framework for developing strategies appropriate for your type of business and knowledge management issues.

* DeLong, David W: Lost Knowledge: Confronting the Threat of an Aging Workforce. New York, NY: Oxford University Press, 2004
John Hehre is a senior operations executive and provides interim management and project based consulting to mid-sized private companies in need of transformative change. He can be reached at jhehre@cprocess.com.

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MN Economic Outlook
For the month of August 2008, reported September 2, 2008. For the fifth time in 2008, Minnesota's Business Conditions Index slipped below growth neutral.



The August index from a survey of supply managers declined to 44.6 from 50.3 in July and 49.0 in June. Components of the overall index for August were new orders at 40.2, production at 45.6, delivery lead time at 52.1, inventories at 47.8, and employment at 42.6. "Minnesota's unemployment rate has been steadily rising over the past several months. Our survey indicates that it is likely to continue to increase by another 0.2 percent by the end of the year before it stabilizes. Weakness was recorded among the state's nondurable goods producers, especially food processors," said Goss.
Dr. Ernest Goss of Creighton University, used the same methodology as The National Association of Purchasing Management to compile this information. An index number greater than 50 percent indicates an expansionary economy, and an index under 50 percent forecast a sluggish economy, for the next three to six months.

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