Lean helps us keep our promise to the customer
DPaschoal provides automotive services and sells tires and other parts through its network of 125 stores in nine regions in Brazil. This is our core business (in 2022, we serviced 318,000 vehicles and 41,000 trucks), but the group also has other lines of business that include a coffee farm, a technology company and an e-commerce portal.
Our mantra, which reflects our commitment to the customer, is "measure and test before replacing". It seems obvious, but it is not always so: in Brazil, it is very common for vehicle maintenance companies to exploit customers' lack of technical understanding to get them to replace perfectly good parts. We do not do that: if a customer shows up wanting to change their tires, but we see that they can drive another 5,000 km before needing to change them, we tell them. This is also part of our commitment to the environment.
The reason we decided to introduce Lean Thinking was that we realized we did not have a standardized way of working across our network of workshops and stores. We wanted to standardize to provide customers with a faster and more consistent service. This led us to redesign our service routine, a project led by Bruno Gomes, our then Operations Director, who had previous experience with lean. Shortly after we started, the scope of the project expanded and we also decided to improve store managers' time management. That was when we started working with Lean Institute Brasil, in September 2021. The team that worked on this project, made up of about 20 people, included the Operations Director, as well as regional managers and supervisors, and the leaders of several support functions that we consider strategic - marketing, IT, project management.
Getting started
We started with the service routine. Using A3 Thinking, we analyzed the current state and the process and simplified it. We created two separate flows, for customers who show up with a clear problem and for those who present problems that need to be investigated. In fact, we implemented few changes: people realized they were already doing what they should, but without enough discipline to follow the standard in every execution. As for the store managers, they realized they needed to be nearby, to provide help whenever needed and make sure the standard was followed. The role of leadership is fundamental in helping the frontline team understand why certain tasks and actions, such as covering the customer's car while it is being serviced (to avoid damage) or showing the replaced part to the customer at the end of the service, are important.
As the standard became clearer, people began to highlight more obstacles to the workflow - whether the unavailability of a spare part or the employees' uniform, which was too hot to work in comfortably. This was not the initial goal of the project, but a welcome effect we experienced. These problems were already known, but we did not have a structured system to deal with them.
It was also important to standardize the managers' day - for example, by establishing a 15-minute daily meeting that the manager must hold together with their team to follow the work, discuss problems and plan properly. That was when we discovered the power of Daily Management, which the teams explored in each of the three pilot projects we carried out to solve the biggest problems they found.
This took place in our stores in Pouso Alegre, Minas Gerais, in Osasco, São Paulo, and in Itajaí, Santa Catarina. The projects began with the introduction of 5S, as a way to better organize the workplace and identify the tasks that were not standardized. This completely changed those stores, which are now clean and well organized (this was not in the areas our customers saw, but it was very important to do it to shape our culture and provide better working conditions for our team). Everything that was not needed was discarded. Thanks to these changes, people started paying more attention to their own behaviors and those of their colleagues: they began to correct each other whenever something was out of place or not clean. The carts were also reorganized, and all the tools that were not needed were put in a box and taken elsewhere. This helped our mechanics work faster. We want all 2,500 people who work at DPaschoal to be aware of the importance of working in a clean, efficient and well-organized workplace, as we consider this a differentiator. We want to reach a point where all our 123 stores follow the same standards.
We also introduced Daily Management, which helped us make progress in improving our NPS (Net Promoter Score) and sales. This approach creates accountability and makes people responsible for problem solving. As part of its implementation, we introduced meetings at different levels to ensure that communication flows seamlessly throughout the organization, across different layers of management. During these meetings, KPIs are monitored, performance is assessed and problems are discussed. About 150 managers and supervisors have already been trained in the use of Daily Management boards and in the culture behind it, while we continue to develop our lean skills. We are currently working on standardizing the level of the meetings between managers and frontline staff, while trying to bring these ideas and practices to other areas of the organization, including administration (where, of course, we will use different KPIs).
By involving our team in lean work, we are seeing an improvement in all our KPIs. In fact, the stores are using lean tools and practices to tackle their specific problems. At the Pouso Alegre store, for example, to improve NPS, the team began interacting with customers before they left the premises, asking whether they had been served properly and whether they had any complaints. If they have a complaint, the team addresses it immediately to try to make sure the customer leaves satisfied. It is NPS before NPS, so to speak.
When it comes to problem solving, the stores rely heavily on problem/solution trees, which we link to 5 Whys exercises. Each KPI we track in our Daily Management has its own tree, offering people a variety of options to choose from when they are looking for ways to impact a KPI. Trees and the 5 Whys are easier for people to understand than A3s, which is why the latter are generally kept for projects run by headquarters, rather than frontline projects.
Overall, this has been a very enriching experience for everyone involved. Being in the gemba, listening to people's pains and problems and helping them solve them is showing our teams that lean is not something we invented at headquarters, but something we want to keep developing together with them in the field. It is the only way to make sure it becomes the way DPaschoal works.
What we learned
For lean thinking to come to define the company's mindset, however, we need the whole team to be involved, including leadership. It is great to see that our leaders are discovering their role in this transformation. It is not enough to support change by introducing a routine once, perhaps during onboarding, and expect it to keep thriving on its own: leaders must talk to people about the new way of working, challenging them on the standards and on what they see in the gemba during their genchi genbutsu exercises. Lean thinking teaches us that capability development needs to happen continuously and on the job.
We also learned the importance of talking more about the process than about the results, so that our people do not misinterpret our priorities - a clear recipe for disaster, with people starting to cut corners to "hit the targets".
Another lesson for us was the holistic view that we realized our people need to acquire. We are finding it extremely important to help them understand their role in generating value for our customers, even if their work is not directly customer-facing. This involves clarifying everyone's roles and responsibilities, and, for that, standards are again the key.
Earlier this year, we launched projects in three more stores and, in April, we launched Daily Management across the company, with the idea of implementing it throughout our store network (and even in the other companies of the DPaschoal group). This will be our biggest challenge. To face it, we plan to take people on benchmarking visits to stores that have already achieved good results. There is no doubt that we will face some resistance at times - it is to be expected in such a large network - but we are hoping to be able to face it with the help of our regional leaders and even the Operations Director. As leaders, they all understand that they need to be ambassadors of Lean Thinking within the company, being fully involved in the transformation. It is not the first time DPaschoal has undertaken a change initiative, but this time, with leadership engagement as the ingredient we did not have before, we will be able to achieve our goal.
