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Ask Art: How Can I Engage All Our Leaders to Learn and Teach Lean?

by Art Byrne
June 10, 2019

Ask Art: How Can I Engage All Our Leaders to Learn and Teach Lean?

by Art Byrne
June 10, 2019 | Comments (10)

Like all things lean, understanding what we did is one thing but understanding why—both the rationale and what we expected to get from it—is the important takeaway here. Failing to explore this runs the risk of implementing the lean “tools” without any understanding of the overriding business strategy, or how they link together and what kind of results you should expect. Unfortunately I think we are still mired in the “tools” phase of lean at most companies today. This type of thinking drives over 90% of the companies that go down the lean path to see it as just a cost reduction program. This of course all but guarantees that they will never become a lean enterprise.

When I was a Group Executive at the Danaher Corporation working on lean, we created the “Presidents kaizen” to engage our leaders and to spread lean learning. We had started aggressive kaizen efforts at two of my Group companies, Jacobs Chuck and Jacobs Brake (Jake Brake). We were using the Shingijutsu consultants (three ex-Toyota executives who had all worked for Taiichi Ohno implementing the Toyota Production System in the Toyota Group companies and in first tier suppliers) and were making great progress, especially at Jake Brake. We were having the usual results: large productivity gains, much better quality, shorter lead times, freeing up floor space and of course rapid reductions in inventory.

Great. Of course, with standard cost accounting, the rapid inventory decline was making our earnings look worse. This concerned the corporate finance boys and resulted in an “emergency” visit by the Rales brothers, who were the majority owners of Danaher. Oh, oh! What to do? George Koenigsaecker (then President of Jake Brake) and I decided that just taking them to the conference room and reviewing the numbers was probably a big loser for us. We needed to show them results on the shop floor first. George K. set up the tour and made the brilliant decision to have it conducted by our UAW associates. We spent about three hours on the floor, and when we got back to the conference room, there was no need for a financial review. All the Rales brothers said was, “How fast can you do this in the rest of the Danaher companies?” (There were a total of 13 companies at that time.)

Well, we were still employed but now we faced the issue of how to spread lean through the other 11 companies. We first asked Shingijutsu to help us but they said no. They felt Chuck and Brake were so bad that they wanted to see them improve first. Now, at that time both George K. and I saw lean as the greatest strategic weapon any company could have. We also understood that it was so totally different from the traditional approach that all our companies were using, that it had almost no chance of being implemented—and more importantly having the improvements stick unless it was driven from the top by the Danaher Presidents.

With that as our principal rationale, we organized the first President's kaizen, with the help of John Cosentino (the other Group executive at the time). Our first step was to take all 13 Presidents and their VPs of Operations to Japan for a week, to observe lean at a high level. I think we visited eight different companies that week. When we got back Cosentino and I basically ordered all our Presidents to participate in a three-day kaizen, every six weeks, at one of our plants. We wanted them to see and experience just how much gain could occur in a few days using the lean approach. We wanted to put them in a position where, when they went back to their own companies, they could overcome the objections from their own staff that they were bound to encounter. “Wait a minute, I know we can do this because I just saw it done at XYZ company during our last Presidents kaizen.”

Well, as you might expect, lots of bitching at first. “Hey, I’m a President of a company, why do I need to spend three days in my blue jeans working on someone else’s shop floor?” But there is no other way. Lean is a “learn by doing” activity, and we were in effect forcing them to learn and understand the opportunities. We moved a lot of equipment, created new cells and got big gains. One of our first teams reviewed a request for a new paint line that was to cost $750,000 and was in the final stages of approval. The team found that not only did we not need to spend $750,000; but there was an additional 50% capacity available on the existing paint line. Cha-Ching! Another team moved a bunch of equipment and created a one-piece-flow line that could produce the same quantity with 3 people that they were using 14 people for. You can’t just ignore gains like this.

Guess what? After about three of these kaizens the bitching stopped and the Presidents were arranging their calendars to make sure that they didn’t miss the next one. Even though none of the then-13 Danaher companies had any overlapping business, the Presidents started to build a relationship with each other. We started to build a culture of kaizen in Danaher. When Shingijutsu was finally ready to help the other companies there was no resistance and we started to see great results. This in effect was part of the early foundation of the now famous “Danaher Business System.”

When I moved on to become CEO of Wiremold, I continued this same practice, with 2-4 such events each year involving the Presidents of our subsidiary companies and my senior staff. As I moved to the Private Equity business I did the same, although in many cases it was more senior staff than Presidents. This worked extremely well. It was great for team building. We eliminated a lot of waste that we never even targeted just because of the mix of functions we had on each team. For example, we put sales and marketing people on setup teams. The team would discover that it was taking 1-2 hours to change from size A to size B which was very low volume and almost the same functionally as A. The marketing and sales guys on the team would say, “Gee, I didn’t even realize we were offering B, which we don’t need—so let’s eliminate it.” Boom, we saved 1-2 hours of wasted setup time, simplified the product offering, provided shorter lead times and lowered the cost just by having mixed management teams.

How you build your kaizen teams spills over into your day-to-day activity even when you are not having a President’s kaizen. You are trying to create a learning environment where every employee can learn to see the waste and contribute ideas of how to eliminate it. I’ve found that the best way to do this is to conduct a great deal of kaizen activity. Roughly half of your teams should be formed with hourly employees, and roughly half from salaried employees. The best ideas will come from the people doing the work. On the salary side, having people from different functions on a team can help get unexpected gains as shown above. At Wiremold we had our field salesforce participate in kaizen on the shop floor early on. We wanted them to understand what they put the organization through when they had unreasonable demands. Just as importantly we wanted them to go back and brag to their customers about the great things Wiremold was doing (which they did, by the way).

So, whether you do a President's kaizen or a senior staff type of kaizen remember that in addition to the gains you will get in the kaizen you will get a lot of “learn by doing” gains among the people who you need to drive lean forward and will not only build great teamwork but start to build the learning environment necessary to become a lean enterprise. Try it, you’ll like it.

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10 Comments | Post a Comment
Owen Berkeley-Hill June 10, 2019
2 People AGREE with this comment

Hi Art,

I could not agree more with your article, but it was very, very depressing. Why did you need to write it 30 or 40 years after Lean was discovered?

One of the glib expressions used when I joined the Ford Production System in 1996 was that we needed health engineers before doctors, which suggested focusing on prevention rather than cure, but Lean.org seems to be focused on the latter rather than developing future leaders to think Lean instinctively.  Your article seems to be a brave attempt to try and change the current, predominant leadership culture, something Bob Emiliani thinks is either tough or impossible (The Triumph of Classical Management Over Lean Management).  What Lean.org seems to have forgotten is the Jesuit (?) maxim of, “Give me the child until he is seven and I will show you the man”.  

I see little attempt by Lean Thinkers to challenge what is taught in the “gold standard” of leadership education, the MBA. And so, you have millions of newly minted MBAs coming of the B-School production lines every year having been taught a leadership philosophy which is the antithesis of everything that is Lean.  Few B-Schools teach Lean, but only as a sub-heading under Operations, therefore severely limiting the understanding of this subject as, perhaps, the most significant advance in our understanding of how a good leader should think, believe, behave and act.  What has the Lean movement done to persuade Harvard or MIT to base their management education on Lean principles? Nada!

If that was not bad enough, there is no agreed definition for this subject. I tried getting some consensus in a forum string a few years ago and was smacked down, because Lean was “contextual” and meant all things to all people.  Sadly, it is not surprising that contributions to the forums have dwindled to a parched trickle which only seems to interest itself with what apps or technology could help their so-called Lean efforts. There is little to recognise that Lean is primarily about growing and focusing the capabilities of your people (as you so rightly understood) in a culture that uses kaizen, not just to gain improvements, but to make everybody have a Pavlovian reaction when they see something that is abnormal and needs investigating.  10-20 improvements per person per year might just do that if the leadership are also involved.

Finally, the Victoria Cross or Purple Heart of Lean is the Shingo Prize, which is organised at the Huntsman School of Business (Utah State).  I wrote to the Dean, a few years ago, and asked if their MBA was based on Lean principles.  Their response was that there was no interest in such a degree.  If the Lean movement cannot change the way future leaders are taught, I believe we will still see articles like yours urging leaders to consider Lean and not leave it to a belt or an expensive consultant.

Maybe we should look for inspiration of the bottom layer of Indian society, the BOPs (Bottom of the Pyramid).  Here is a talk given by Captain Raghu Rahman to an Entrepreneurship Forum a few months back: https://www.youtube.com/watch?v=yQGaoj9Iwro&;feature=youtu.be">https://www.youtube.com/watch?v=yQGaoj9Iwro&;feature=youtu.be. Do these poor people have a better grasp of Lean than the MBA?

 

 

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Harry Kenworthy June 10, 2019
1 Person AGREES with this reply

To build on the commentary about "higher ed", there are not many good examples of Lean thinking at the University level - the University of Washington has made some excellent progress (Shingo writeup), but this is rare. The key Lean academic/practical thinkers like Jeff Liker and Bob Emiliani have had a difficult time gaining traction within their own academic worlds with their administrations.

We submitted an RFP bid for a Lean cultural transformation to a major university in 2017 and 23 months later they are still "deciding" what to do. I sincerely believe the academic higher ed world is most resistant to change since Lean has never entered their academic training or experience. As long as states throw more money at universities to balance their budgets without even considering the levels of waste, and/or tuition, room and board cost can be escalated at 2X+ the inflation rate, there is no incentive to change. Of course, this is complemented by having the most brilliant folks on staff who already know what is best for academia.

Very sad state for higher education. Offer lean to outside "customers" but don't apply it to "ourselves". Seems like this plays very strongly into the college debt crisis for students due to the enormous unaddressed wastes involved.

 

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Bob Emiliani June 10, 2019
1 Person AGREES with this reply

Hi Owen – You make an interesting point about the cure versus prevention. In the undergraduate and graduate programs that I teach, the focus is teaching students to think differently. They eagerly apply the Lean principles and practices that they learned in school with some success. However, they soon run into traditions associated with classical management that are enforced by managers at higher levels, which undercuts their ability to initiate anything other than small local improvements that usually have little business impact. True, they are learning, but they are also getting frustrated and it is not long before most are forced to capitulate to the twin demands of: 1) business traditions and 2) the institution of leadership which seeks to preserve the status quo. Top-tier business schools, bottom-tier business schools, economists, and others consider TPS and Lean to be an insignificant tweak to classical management practice. Economists assume that competition in the marketplace will sort out which management practice delivers better results and thus become dominant. Obviously, that is a bad assumption. As we know, Lean must be led, but the process for finding Lean leaders has been inadequate and may even be the wrong approach to expanding the adoption of lean management https://tinyurl.com/y27a69x7

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Bob Emiliani June 10, 2019

Hi Harry - It is true that the top administrators that I have served under have shown no interest in Lean management for the university. But that has NEVER stopped me from applying Lean principles and practices to my work as a professor (which consists of teaching, research, and related administrative tasks). I just plow forward and focus on applying what I learned from Shingijutsu when I worked in industry. Like most organizations, universities are resistant to change – but it is bifurcated. Changes is easier in administrative work (where you find Lean, if it exists) than in academic work. The reason is that university presidents do not want to confront the faculty. Nor do they know Lean well enough to persuade faculty of its merits and engage them in kaizen (for improving academic programs, courses, etc.). Without doubt, these are clear failures of university leadership -- particularly in relation to the student debt catastrophe. Finally, for the past 10 years or so, public higher education, in particular, has faced budget cuts and have not had “more money thrown at them.” Each budget cycle, education money was diverted to industry for tax breaks, jobs, etc. (zero-sum game). Both universities and industry need Lean management.

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art byrne June 12, 2019

Owen, thanks for your comments. We all share the same frustration. I yeild to the good professor Emiliani in his response to you. If a lean zealot like Bob can't get his own school interested in offering a lean degree program then , at least at this point it is probably a lost cause. I'd rather focus on the few in industry that are even willing to try lean and teach them what they need to do to become lean leaders. Over time I think their results will shift the conversation such that every leader will feel forced to adopt lean lest they fall too far behind. This is and will be a slow process with the last ones on the train being the acedemics. It's hard to teach something new to someone who already knows everything.

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Jean Cunningham June 14, 2019

I agree there is not enough interest in academia.  Another good masters program is the one at Ohio State University, Masters of Business Operational Excellence. It is not only lean, but definitely focused on an option to traditional managment.  And many schools are teaching lean within operations.  

Art mentions the standard cost problem, and it is one while we have tried to crack the nut with educators, it has been slow (but not absent.)

As Art says, we know this is a better way to lead our companies. I thought we would be much further along by now, but the fact that we are not, will not allow me to stop the efforts.  

We need to drive to next generation of leaders. And continue to fight traditional managment.

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Bob Emiliani June 15, 2019

Hi Jean - "We need to drive to next generation of leaders. And continue to fight traditional managment." That sounds like just keep doing the same things that have been done in the past -- but try harder. There needs to be a fundamental re-thinking of the problem. See https://bobemiliani.com/lean-graft-incompatibility/">https://bobemiliani.com/lean-graft-incompatibility/ Given the trove of new information in my TCM book, I would hope that it motivates LEI and others organizations that promote Lean to try new things (see Chapter 4, "Dismantling Classical Management" -- it offfers creatiive and practical pathways for upsetting the status quo). 

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Bob Emiliani June 15, 2019

Additionally, it is not respectful to ask the next generation of leaders to confront the same difficult problems as the past generation of leaders were unsuccessful in dealing with, under the assumption that there is no new information that could help improve their prospects for success. In my teaching of Lean leadership, I teach both the promise of Lean and the peril of traditions (TCM book) so that future leaders have full disclosure and can chart a better path based on knowing the facts of the situation. LEI can use the TCM book in its teaching to responsibly do the same.

Leslie Barker June 10, 2019

Does the prevention come from business school or from within the person / leader?

 

I’m not letting any business school off the hook. The president’s kaizen Art refers to seems to focus on teaching leaders to study and change other people’s work. It is good learning, for sure.

 

But truly instilling lean comes when it is applied to your own work. Where is the president’s kaizen that changes the way an executive team works together? Should they not increase the quality of / decrease the waste in their own work and its ability to deliver results at a certain pace or sustain changes that are already known to prevent problems? Is there not a cycle of work for leaders that must be common and can then be improved upon? Such as daily gemba time? Regular PDCA checks? Confirm a good condition?

 

The heart of engaging leaders to learn and teach is not in changing others work / not in what is learned in business school. Art and Bob both referred to it. It is in improving the way the leadership team as a whole works in a standard way.  It may have started with “thou shalt.” It eventually turned into each leader practicing problem solving every 6 weeks. That is a good start to a cycle of work. Keep building on it. Regularly.

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art byrne June 12, 2019

Leslie, thanks for your comments. Your right of course that leaders must eventually change the way they work. But, before you can get even close to that you need to get them engaged in lean at some level. In fact getting CEOs, owners and other leaders even interested in lean has been one of the most challeging aspects of the lean movement. At Danaher we kind of forced that with the mandatory attendence at the Presidents kaizens. We knew that in less our Division Presidents drove it lean would go nowhere in Danaher. Exposing them to what was possible was a first step but the sucesses built on themselves. At first they complained about having to go. After about three kaizens they didn't want to miss them. They started to build a sense of team work amoung this leadership team. As we drove lean into their businesses they started to change their behavior, spent more time at the gemba, worked with their own teams, participated in daily management and built a real team focused on lean in their own management team. Maybe this isn't as pure an approach as you would like but a] you have to start somewhere and b] it worked.

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