As part of a new LEI research project on lean management, I have been visiting with a number organizations well along in lean transformations. I ask the leaders of these initiatives about their methods, their experiences to date, and their trajectories. Then I take a walk along one or more of their value streams to observe performance and to talk with line managers about their perspectives on the lean leap. Here’s a typical story from a recent visit:
Organization A has an ambitious “lean six-sigma” program for the whole enterprise. As seems to be increasingly common, it is a consolidation of initially separate lean and six-sigma programs into one unified activity, reporting to a vice president for process improvement and quality at headquarters.
The program is being conducted by a large staff team assisted by a few external consultants. Good progress has been made in reconciling the approaches of lean and six-sigma by adapting DMAIC (Define, Measure, Analyze, Improve, Control) as the organization’s PDCA (Plan, Do, Check, Act) problem-solving method. (I’m often asked whether DMAIC or PDCA or A3 is the “correct” method to use and I always say, “Pick one, adapt it as necessary to your needs, make sure everyone understands it, and get going. The right method is the one that produces consistently good results in your organization and you will be able to judge that for yourself over time.”)
The team has offered introductory training in lean thinking and process capability for a wide range of employees and has conducted black belt and lean certifications for a substantial number of line managers. It has done this while leading a large number of rapid improvement activities (labeled “kaizen”) that engage both line managers and the front-line employees touching value streams. It also conducts six-sigma analyses of quality issues over an extended period, which collect and analyze large amounts of data.
The individual improvements have often been very impressive, particularly as measured in financial terms using six-sigma methodology. But as I talked with line managers I discovered that the improvements are not connected end-to-end as key processes cross areas, departments, and functions in the organization. Perhaps as a consequence, the business results for the organization are much less than the sum of individual achievements would suggest. This led to an observation I hear frequently: “How do we save so much money and improve quality so much on individual process steps yet little seems to be dropping to the bottom line and customers seem no happier.”
Even these isolated improvements are not easily sustained once the improvement team’s focus shifts to the next project. The line managers are sympathetic to the concepts they have learned but note that they are still fighting fires due to issues up and down stream from the areas they manage. This leaves them little time to install standard work to sustain what has been achieved and none for planning the next leap. In addition, none of the corporate metrics they are being judged on have been changed, so it’s easy to get poor performance on a metric despite a worthwhile improvement in a process. Finally, many managers noted that they will soon be rotated out of their job – as part of the organization’s high speed management advancement — without a good means of handing over what they have learned about the process to whoever takes charge next.
When I visited, the lean six-sigma team was reflecting on its achievements over several years and asked my view on where the program should be going in the next five years. I believe they were expecting me to say that they needed to speed the pace of improvement, with more training, more improvement events, and quite possibly a larger staff. My answer was quite different:
“You need to transition during the next five years from a point-improvement program driven by a staff team to a new way of thinking and acting by line managers. The line managers’ key work must be to continually solve problems end-to-end in primary and support process for which they are given responsibility. Put simply: You need to transition from a staff conducting a program to line managers routinely solving problems important to the organization, often with the technical assistance of your lean team.”
I assured them that a change in focus will not reduce the importance of the lean team. Rather it will create demand for tackling process issues that are more technically interesting, as line managers take the lead on easier problems. And it should also create a role for the lean team in advising on design of the production process for each new product. This is a critical weakness of the current organization, which routinely launches products with poorly conceived production processes, leading to the immediate need for kaizen. (It turns out that there is even a Japanese word for this practice — “touzen” – which is used to describe kaizen which should not have been necessary.)
Unfortunately, I couldn’t be so reassuring on what I see as the lean team’s biggest challenge: They need to make the case to senior management that Organization A’s management methods need to be fully rethought. Every important process needs to have a fully responsible manager who stays on the job long enough to really understand the process. And the corporate measures of management performance need to be carefully rethought so managers will consistently be rewarded for doing the right thing for the extended process over an extended period.
While it may seem difficult for a staff team to make this case to senior management, I wonder who can if the executives with the greatest knowledge of process thinking and with the best understanding of what is happening today can’t. So I urged them to try and promised to help to the extent I can through my writing and speaking.
Before I sign off, please understand that I’m not criticizing lean programs, which Dan Jones and I helped popularize in Lean Thinking. They are usually essential to get people’s attention, move organizations off dead center, and rapidly introduce new ideas while clearly demonstrating their potential. But they are never sufficient. What every organization must do at some point is make the conversion from lean programs led by staffs to problem solving by line managers. And the faster and more completely an organization makes this transition the more successful it is likely to be.
With best regards,
James P. Womack
Founder and Chairman
Lean Enterprise Institute
P.S. I plan to visit Organization A again as our research continues and I would be interested to hear from other organizations who would like to participate in our research program. We can only include a small cross-section of the many firms now pursuing a lean transformation. But if your organization is interested in participating, please let me know.