While no more than 10 percent of Lean turnarounds will succeed, I know that 100 percent of them will be met with deep and widespread resistance. That’s been the case for every company I’ve transformed on my Lean journey. That’s why it’s so important to expect this and, rather than resist or resent this human response, prepare for the various forms of resistance you will face, and have countermeasures already on hand to deal with them.
Because Lean thinking is almost completely opposite the traditional way of thinking you should expect to encounter “While no more than 10 percent of Lean turnarounds will succeed, I know that 100 percent of them will be met with deep and widespread resistance.”resistance from every part of your organization. Converting to Lean is all about people and this is what makes it difficult. People just don’t like to change. The fact that most companies that start down the Lean path see it as a cost reduction program or just a set of “tools” that can be used selectively to solve problems only compounds the problem. They miss the fact that Lean is a strategic approach to delivering more value to their customers. They also totally do not understand the “Lean is all about people” aspect of a Lean turnaround and thus make it far more difficult than it needs to be.
Even if you get the people part right you still will face resistance. Over the years I’ve constantly heard common refrains: “This will never work here.” “We are not like those other companies.” “We tried something like this once and it failed.” I’ve found that resistance to Lean is rarely felt uniformly across the organization; tdifferent people and different functions will push back in their own unique way.
So let’s take a look at the various potential resistance points and what you might do to anticipate and overcome them.
Your senior management team will be a challenge. They all got to where they are by doing things a certain way, and they will want to continue their old approach. Most will see Lean as an operational thing that does not apply to them. Making it very clear to this team that Lean is not an option will help a little, but it will not change things all that much. Insisting that this team spend 5-6 full weeks per year on kaizen teams will help get them going in the right direction. The bigger hurdle here is to get them working as one team such that senior management speaks with one voice. This will take more time as they may be used to blaming other functions when things go wrong. You will have to stop this behavior. Make it clear that you will no longer referee their arguments. This, plus running many “learn-by-doing” activities in kaizens will eventually get them there.
THE WORK FORCE/UNIONS
While I have learned that lean can work well in organizations with a strong union presence, if you present Lean solely as a cost reduction plan then you will face fierce resistance from your work force or union (if you have one). Any time you propose major organizational change you will make your workforce and union nervous. At first, people will be convinced that this is just another approach to eliminate their jobs. That’s why you can’t even think about doing Lean without publicly and consistently guaranteeing that no one will be laid off as a result of kaizen activities. They won’t believe you at first so you’ll have to show them. Next, make sure to have a mix of hourly and salaried people (50-50 works the best) on the kaizen teams so they clearly understand that your primary goal is remove the waste—with their input and participation. They will have the best ideas of how to do this so make sure you listen and implement their ideas. As their work gets easier and safer (a 5-minute changeover takes less work and is much safer than a 3-hour changeover—which they will immediately understand), they will quickly drop their resistance and become Lean champions. This is the easiest group to convert to Lean thinking if you do it right. A profit sharing plan where they can share in the gains would be a big plus here.
SALES AND MARKETING
Your sales and marketing force will initially assume that Lean is “some operational thing” that doesn’t apply to them. They won’t resist doing Lean in other parts of the company; but they will insist that they be left alone to do things the way they always have. You cannot let this happen. These individuals play a vital role in the company, and in fact they have an enormous impact on operations on rest of the company. They will have to change, to become as Lean as everyone else, because failing to do so will cripple your Lean efforts. The incentives that drive the sales team frequently reward behavior that stymies Lean in other parts of the company. For example, if sales incentives result in 50% of your shipments happening in the last week of the month, you are creating an impossible condition for your people in operations, who are trying to move from batching to one piece flow and trying to level load the factory.
In other words, you cannot have one department seeking large batch type orders—and in fact promoting that activity by allowing them to give volume discounts to get them—when the rest of the company is trying to reduce lead time and cut setup time in order to be able to quickly respond to mix changes. The sales and marketing teams need to be on the same (Lean) page as everyone else. They must be willing to change sales terms—especially if current policy causes 50 percent of the orders to ship in the last week of the month. They have to be willing to help your customers reduce their inventory and stop ordering in big batches. This is not a gimme, to be sure. But, if you put the sales and marketing teams on the early kaizens so they can start to understand the impact of their own actions, and you work with them to make the policy decisions needed for Lean, you will find that their resistance will quickly go away and they will become Lean advocates, selling the enormous benefits of Lean to your customers.
I think that most people understand that about 80 percent of a product’s ultimate cost is determined during the design stage. It is also true that the traditional design approach is excessively iterative, takes too long and is so disconnected to operations that at the end of the process the people in operations will say: “You want me to build that? How can we do that?” And, these traditional companies will pursue new products that come from the voice of the CEO or the VP of Engineering—and not the voice of the customer. Engineering will behave like sales and marketing: you won’t get a lot of pushback about Lean, as long as they can keep doing what they have been doing.
“Most finance people and teams are committed to their traditional standard cost accounting and will fight like crazy to keep it.” Of course you can’t let this happen. At Wiremold we changed to the QFD (Quality Function Deployment) approach to new products when we started Lean. We created cross-functional teams of marketing, operations and engineering for all new products and brought the voice of the customer into the process up front, in the conceptual stage. We also decided to hire all our new product development engineers right out of grad school. We put them on the shop floor learning Lean, and understanding our capabilities, for two years before they had a chance to move into product design. We didn’t want them designing things we couldn’t make. These changes pretty much eliminated any resistance to Lean from engineering.
If you can count on anything regarding a Lean transformation, you can count on a battle with finance, which for most companies is likely to feel like Resistance Central. Most finance people and teams are committed to their traditional standard cost accounting and will fight like crazy to keep it. They will give you a surplus of great excuses (none of which will be true but will give you pause). “Our auditors will never let us change our standard cost approach.” Or, “The IRS forces us to absorb inventory in a certain way.” The truth is that standard cost accounting is what I call the anti-lean as it incentivizes almost everything that you are using Lean to eliminate. You need to switch to “plain English or Lean accounting” early on to be successful in your conversion. In my experience, putting your key finance personnel on early kaizen events is perhaps the best approach to solve this problem. This gives them a chance to see things from a different perspective. There are good books (my Wiremold CFO Orry Fiume and Lantech CFO Jean Cunningham wrote one of the first and best ones, Real Numbers) to read and lean accounting seminars and training sessions that you can send them to. Be patient–but make sure that you get rid of standard cost accounting.
In my experience, you can expect the most consistent resistance to change from your middle managers, who as a group are perhaps the most threatened by the shift to Lean. They traditionally ran functional departments where they were seen as the expert, able to exercise authority without anyone challenging them. Lean requires an organizational (and radical) shift to a value stream structure, requiring input from all employees on how to remove waste. No more “check your brains at the door.” Managers must acknowledge the need for the hourly work force to be constantly engaged in contributing ideas on how to remove the waste. Most traditional managers don’t know how to deal with this shift. They try to go on behaving in an authoritarian way. They have trouble seeing the necessity for change; and others cannot easily understand how to do it.The message from the top is to work Lean; but the message they may be delivering to the people on the shop floor every day is traditional batch.
This is a tough challenge, and you can close the gap with a lot of training and close monitoring of these middle managers. Being on many kaizen teams will help. Even so, we found it necessary to add a few questions to our annual employee survey that allowed the workforce to give us direct feedback on their supervisors. This helped us know who we had to spend extra time with.
Resistance to Lean will come from every part of your organization, senior management included. Knowing where the biggest resistance will come from, however should help you focus your early efforts and smooth your Lean turnaround.