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How Do You Spread a Lean Transformation from One Site to Many?

Michael Ballé
2/2/2015
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Dear Gemba Coach,

How do I spread a lean program? I’ve had good results at my site and my CEO has asked me to spread lean to 30 other sites. How should I go about it?

You’re in a tough spot, no question about it. On the one hand, you’ve got to do what your CEO asks. On the other, what he or she expects might not deliver as he or she expects. How to interpret “spread”? There are two broad ways of looking at this:

  • Roll-out: The usual way would be to create a clear model from your experience –what tools you used to get what results -- and to implement this model in the other sites.
  • Enroll: Convince a group of five other site managers to work together and learn from the way you’ve done it, and then get them to work with five groups of their own.

Roll-out is the classic method of deploying any continuous improvement program. There are four elements to a roll-out program:

  1. Roadmaps: You must start with clarifying your own experience in terms of what tool helped you to reach what result. This, of course, is a fiction, since activities and results and never one-to-one relationships, reality is too complex, but it usually can be done, such as using 5S to lower accidents, yamazumi to boost  productivity, SMED to lower inventory,  and so on.
  2. Objectives: The next step is to size the improvements you’ve achieved on key objectives and get your CEO to commit to these improvements companywide, obtaining the commitment from every other site managers to reach these numbers. Typical objectives would be affect safety, on-time delivery, quality complaints, internal quality, inventory, productivity, etc.
  3. Continuous Improvement Coaches: You would then form a central office for continuous improvement coaches. Each CI coach would be full-time dedicated for the lean program, and go around the sites conducting workshops on the tools according to the roadmap. To spread the CI office, think of how many workshops you’d need a year to get the other sites off the ground. On the basis of a workshop every couple of month, you’d need 150 workshops done a year. To do the job well, a CI coach can run two workshops a month (with preparation and post-workshop hand-holding), so we’re talking about a central office of six to seven coaches.
  4. Gemba Visits: You need a commitment from your CEO to visit the lean effort at all 30 sites at a minimum of one visit a year. That’s a visit per week or so -- a heavy commitment for many CEOs.

Pros and Cons

The advantage of a roll-out program is that it’s relatively easy to set up. Programs like this have been around for 20 years now, there are enough black belt trained coaches around to recruit a lean office and it can even be farmed out to consultants if need be. Early results are fast and, with a tiny bit of luck, can be spectacular.

The downside is that looking back on these implementation efforts we now see they are mostly “catch-up”. Their merit is to clean out the poor sites and find some obvious things all sites do wrong and fix them. In all the companies I’ve visited over the years, none of these programs have ever instilled a lean culture or continued to deliver results beyond the first three years. Not “a few” not one.

There’s another way to go about spreading lean, which is taking a page out of Toyota’s book. Within Toyota, TPS spread from plant to plant as Taiichi Ohno was promoted to more senior operation roles and recruited more managers to his cause. Then it spread to Toyota’s suppliers through the top.

Supplier CEOs were told (sometimes in no uncertain terms, as described in Lean Thinking) that if they wanted to continue to work with Toyota they were expected to reduce waste in their operations and adopt just-in-time practices to be able to deliver in Toyota’s preferred continuous small batch manner. Toyota would send sensei and engineers to the supplier to help the CEO figure it out.

In the UK when Toyota started operating at Burnaston, it created study groups of five or so supplier senior execs from different companies and, as a team, they would learn TPS in each other’s gembas. Years ago, I’ve seen Toyota spread lean thinking to its dealer network.  They first did an assessment to see which suppliers were already good enough to benefit from CI (if not, catch-up was in order), and then proposed coaching to this select group on a voluntary basis.

In your case, the enrolment approach would mean:

  1. CEO challenge to improve performance: Your CEO would have to start by asking each of the 30 sites to duplicate your performance improvement curve on key indicators. This means taking a period of, say, two years, and asking each site to determine a start point, end point, and leveled monthly project on the key performance indicators mentioned.
  2. Find 5 or 6 other plant managers ready to learn how you’ve done it: Create a study group of a few other site managers ready to learn, to teach them how to develop a lean culture in their own site. Each site manager would then have to come up with their own improvement plan A3 according to the specifics of their sites.
  3. Train a few CI engineers to support these plant managers: You would be supporting each member of the group on improvement activities, but hire one or two assistants to join you so that they could learn supporting sites on given activities as well. Activities are mostly tools, but not limited to tools and site-dependent.
  4. In two years’ time, ask each member of your initial group to create a group of their own, and train five other site managers to improve the way they’ve been taught to. At this point, you’ll have a small team of CI engineers who can help you support activities in a larger group of companies.
  5. Gemba visits and a lean day: The CEO has to, similarly, visit sites, but also organize a yearly get together of all 30 site managers where a status report is given on the progress of all sites against indicators as a presentation of site by site improvement plans to discuss successes and disappointments.

Change Minds, Not Sites

I realize that many traditional thinking CEOs will balk at the second approach, considering this would take too much time and be too uncertain and people dependent. But let’s face it, this is how lean cultures do spread in companies and in actual fact, experience shows results come much faster this way than in the previous one.

History tends to be very path dependent. The innovative CEOs who turned to lean 20 years ago did so with Toyota veteran consultants, many of whom came from Japan for five-day workshops, for obvious logistics reason. This spread the idea that workshop-based programs could create lean turnarounds. There is so far no evidence that it does, other than when the CEO is directly, hands-on involved, in managing the turnaround with the support of these expert consultants as described in Art Byrne’s great book Lean Turnaround.

The confusion here is that, to be successful, you don’t want to turn around the site, you want to change the site manager’s mind. No two ways about it, company-level results are obtained site manager by site manager, and the result of how they run their own operations, so one way or the other site managers need to be trained to lean thinking. The question is which way: roll-out or enrollment?

5 Comments | Post a Comment
Arnout Orelio February 4, 2015

Hi Michael,

Great reflection on how to 'spread'. Especially to comment on how we perceive things (lean by workshops) versus what is actually happening (lean culture by CEO).

Question: in your enrolment plan, it seems like the CEO is still delegating lean to the site(manager)s? Is this what you intented and why?

What would happen if the CEO was asked to take part in the study group or another way of personal, hands-on engagement? 

Michael Balle February 4, 2015

Yes, it's what Art Byrne advocates, and I'm sure he's right. In my firsthand experience, the CEOs I know are reluctant to participate directly in kaizen events, and not entirely for bad reasons. However, they are very interested in the outcomes of kaizen activities and many kaizen activities are results of direct Gemba challenges from the CEO. 

 

It's hard to compare because I have no experience of CEOs participating in study groups other than Art's accounts, and when CEOs participate directly in problem saving, everyone falls into "let the boss decide". Challenging, and then studying what each study groups comes up with lets the group some breathing air to work things through and gain autonomy, whilst benefiting from the learning. Good point, no good answers :))

Vivek Anand February 4, 2015

Very well written article. In our quest to implement Lean, we forget that Lean management is beyond just process tools. It also lays great focus on developing its people & extended network of suppliers & partners.

I appreciate your taking the cue from the way Toyota developed its suppliers & using it to implement lean across all sites.

I believe that we should follow a mix of both the approaches (rollout & enrol) while implementing Lean.

Rollout will take the initiative immediately to the level of the front line executive - & that is where most of the continuous improvement (Kaizen) comes from.

Enrol is more to do with getting the strategic level improvement. It will involve the middle management and could focus on strategic projects within the organization.

 

Vitezslav Pilmaier February 5, 2015

Very good article and insight to the difference between roll-out and en-roll. It is obvious, that the CEO role is a key factor in both approaches.

And I do agree with the comment, that in the final end somehow we end-up of mixture of both roll-out and en-roll approaches.

My opinion and some experience is, that to start spread lean (and kaizen) culture from one site to another it is important that both sites speak the same language and for such purpose it might be good to start with a roll-out of basic tools (usually consisting of 5S, H&S basics, TPM and standards) and after some time switch to the en-rollment approach...

Arnout Orelio February 14, 2015

Hi Michael,

Thanks for your response!

To probe some more:

How to get the CEO to challenge in 'the right way'? How can we make them experience the difference between 'demanding results' and 'challinging the results to develop people'

The risk seems to be that they not really care how to lean results are achieved. How can we make the care?

Arnout