Lean or not lean? In my circle of digital entrepreneurs, I often hear this question of whether to pursue lean or not. “Okay, lean is fine, but I’m not sure I agree with all the principles.” Or: “Ok, lean works for that but not for this.” Or: “It’s an operations thing.” Or: “do I have to do all of it?”.
I’m not sure those are the right questions.
The spectacular business successes we read of in the press don’t happen purely by chance. Their leaders are supposed to be visionaries with great strategies but, when you talk and listen to them, you learn that what they mainly have are concrete leadership models. These models which they have crafted and developed over years. Eric Schmidt from Google reveals much of this in How Google Works and these thoughts are built on in the recent Trillion Dollar Coach: The Leadership Playbook of Silicon Valley's Bill Campbell.
We also know from Marc Onetto, former Vice President of Worldwide Operations and Customer Services of Amazon, that the worldwide ecommerce leader has been greatly inspired by lean theories. Recently an Amazonian explained to me Amazon practices such as 5 why, 6-page memos, or working backwards – all of which exemplify Amazon’s adoption of lean tools.
Decathlon’s former CEO, Matthieu Leclercq, has just published a book, Why It Works, where he explains his leadership model. And, of course, Toyota continues to dominate the auto industry with its Toyota Way. Those are few examples but we could probably fill an entire book with the leadership models those great companies have developed.
Lean is a leadership model: for more than 60 years now it has been developed, analyzed, tested, adapted; largely by Toyota but also by many others, copying, adding, evolving. As a leadership model, as opposed to an improvement program, lean has had successes aplenty, large companies as well as small ones. In industry but also in healthcare, services or, in our case, digital.
Because lean is so well documented, you can find inspiration on any question you can ask yourself as a CEO, from strategy to innovation or indeed, operations.
We were recently challenging ourselves about our internal incentive system at Aramisauto. We were not happy with the way it would occasionally drive our staffs to work against each other; or worse, to work against the company or the customer. We needed to think differently, so we searched the lean community for relevant experiences or theories. And we found so many things, from Deming (who inspired Toyota in the ‘70s) to Art Byrne and Orry Fiume who have more recently succeeded with Wiremold! This led us to rethink not just our practices, but our very thinking about incentives and pay-for-performance.
Lean is unique in that it has clear theories about how to develop people, how to satisfy your customer, and how to improve your profitability: to develop your people, grow the business.
As a CEO, working with a lean sensei has taught me first the power of deep dives. Rather than try to understand what happens through reporting and management meetings, I’ve learned to go straight to the gemba and listen to frontline operators share how they see things and experience them.
Secondly, it has taught me the power of clarifying the company goals to orient everyone towards better responses to customers and to have the executive committee work on enabling frontline flexibility rather than stifling it with rigid processes.
This has also taught me how important a culture of “bad news first” is to create psychological safety in teams and engage staff in problem solving as well as involve them in team kaizen. Respect for people is key if you want your people to show the same respect to your customers and grow your business on customer satisfaction.
Finally, this has taught me the power of teamwork and having senior managers write A3s to share their thinking and solve problems across functional boundaries so that we face market challenges as one team rather than competing functions.
Being a digital company, many of our processes are fully automated and we are far more flexible in many ways than traditional businesses. The downside is that as features and software add up, our systems become complex, buggy and of course, opaque. A culture of problem solving is what we absolutely need to make sophisticated systems work and interface, and to teach people how to use them to full advantage. Lean leadership is the key that unlocks this intractable problem. Co-writing the book The Lean Sensei has helped me to realize how sensei-ing can inspire the lean leadership model.
I can’t think of any other leadership model that is so comprehensive.
To my mind, the right question is not “lean or not lean?” but: What is your leadership model?