In her recent book, Makers and Takers, How Wall Street Destroyed Main Street, journalist Rana Foroohar argues that the disproportionate power that finance exercises in the economy has had disastrous consequences for society as a whole. AI and automation threaten to replace flesh-and-blood workers, and profits are more often than not used to buy back shares or attract funds in large corporations. The financialization of the economy also takes away meaning from our daily operations and can have dramatic consequences on our lives. A lean approach provides a powerful alternative to short-term enterprise driven solely by the goal of maximizing profits while externalizing human and environmental costs. Indeed, Lean promises a more humane, productive, meaningful, and ultimately, sustainable path forward.
Catherine provides a number of examples where management focus is totally counter-productive in terms of long-term achievements and purpose. Anne-Lise argues in her account that lean purposes and values are definitely inclusive for the teams, the company and society at large.
Purpose gives sense to our daily operations and lean tools and concepts help frame team efforts to achieve it. Rose witnessed how lean can change lives and she recounts an illuminating story on the drastic reduction in neo-natal death rates in a hospital experimenting a lean approach. Cécile demonstrates that the conjunction of Just–in–Time and Jidoka help clarify which problems should come on top of our list and that lean is a bet on intelligence.
Sandrine re-enforces the point as she ponders the alarming statistics on burnout: lean could clearly prevent those with purpose, kanbans and kaizen. She concludes with an open question: What are we waiting for to create a better businessculture that the next generation can take pride in?
Finally, Jean bounces back to recollect the emotions of her early lean experiences and how she has since then seen companies survive that were going to fail, saving jobs and creating hope.
Lean is the best management standard known today to generate sustainable growth–a real, foolproof alternative to traditional management by the numbers.
How are you framing success? If, for example, you had to select one KPI from your boss or your shareholder’s point of view, what would it be?
Consider the examples I’ve encountered recently—all of which strike me as short-term profit-optimizing metrics rewarding unsustainable and ultimately unhealthy behaviours. These include KPIs such as: a car rental operation paying extra bonuses to front desk employees based on how many additional sales they can make before handing over the keys, as well as how well they invoice for car damages, all for the purpose of boosting revenues without actually delivering more value. I’ve also seen a sophisticated production line where teams measure only the line speed and the OEE, for fear their costly investment will remain idle. I’ve visited a Purchasing department threatening to move suppliers out of the supplier panel unless they complete tons of useless redundant documentation, sign charters of all kinds, submit themselves to ISO audits and reduce their selling price. And, I have observed an agile team delivering apps sprint after sprint, great at meeting output targets but blind to customer ergonomics and usage issues.
These examples make me wonder: Does no one ever worry about the customer lead time and how long she will have to wait between a request and its delivery? Pushing for additional sales at the front desk, for example, will further increase the waiting time in the customer line.
Poor customer lead times will also stem from the fear of seeing costly resources idle in plants or offices: this fear will inevitably lead to maximized productions, pushed flows and an output disconnected from actual needs, and lean has taught us that this means stocks and stagnation.
And what about quality? How do we ensure that we will refuse to accept bad parts, nor create defects, nor hand over bad parts to the next step, if we are running at full speed with a maximised OEE as our sole concern? Harassing suppliers will not bring the best out of them either, and Purchasing would probably do a better job if they chose to develop added value and intelligence on wastes within their supply chain, rather than just enforce lower prices.
And who is truly worried about customer satisfaction nowadays? The Net Promoter Score is so universally used that it fails to convey the real value of your products or services. When was the last time your postman, your garage repair attendant or your household appliance salesman told you how to answer the famous “would you recommend this product/service to your contacts” so that she doesn’t get blamed?
Our world is governed by Finance, whether we like it or not. If you plan to bring in additional sales from emerging markets, you need to look good on the bottom-line to attract funds that will help you finance your growth. But as you grow in new countries, you generate bureaucracy, complexity. So you start cutting costs, or enforce best practices and procedures, all of which leave you unprepared in the long run as new operators start hacking your market.
Lean, as I see it, is the best-known management standard to generate sustainable growth today. It is a real, fool-proof alternative to traditional management by numbers. Lean shifts a company’s focus from costly investments that cannot afford to remain idle, to well thought-out, flexible, production lines, working in pulled flows with minimal stagnation. Lean shifts the ExCom binoculars from maximised sales objectives to understanding customer usage better, reducing customer lead time and developing competencies to foster quality and attractiveness.
Lean is remarkably efficient. The art of Toyota was to observe and implement the quintessence of what we, as social animals, have learned over time, in order to successfully drive complex human organizations through a complete commitment to respect, challenge, teamwork, kaizen, genchi genbutsu, and more. The approach is tough, demanding; we also know that.
Lean is the management approach that will teach us frugality in a world that is suffocating from wastes and looting of natural resources; that will teach us respect and teamwork when headlines and networks buzz with uncompromising stances, if not hate and blame. This is why it deserves our unwavering commitment.
Anne Lise Seltzer
The Lean approach opens up a space for collective reflection and discussion to identify courses of action to be implemented and learned from together.
The first time I heard about Lean, I didn’t even know how to spell it. But two dimensions immediately caught my attention:
- Lean was about ways of working and appropriation of work tools
- Lean talked of respect and of an inclusive approach, within the team, the company, and society at large
At that time, I was in a company that had just completely renovated its industrial production equipment and processes, but had not yet achieved the expected quality levels. Despite the support that had been provided, the teams were rather distraught and were no longer able to find their bearings in this new working environment. Managers felt that they had done everything they could to transform operations and thought that the teams were resisting change. And the experts accused everyone of failing to do their job.
Discovering Lean gave me hope for a better way. I told myself that this approach could help teams to own this new work tool and find meaning in their job; and to help managers better support their teams. The interests of both parties could thus converge. And, at the same time, this would enable experts to better understand the situation rather than point fingers and look for culprits. We started… and we made a lot of mistakes… but I started to learn what Lean is.
We saw conversations blossom between operators, who had been working 30 feet away from each other for 15 years, on different steps of the process, and had never before shared anything meaningful about their work. When they finally compared their quality expectations, they discovered they rarely supplied the expected quality level, simply because they did not know the needs of the downstream steps. Lean triggered reflection on methods and gestures, which enhanced collaboration, yielding significant results in the different workshops. Quality of service shot up by 10 points in a few weeks in this 200-people distribution centre that was up-to-then perceived as a “difficult” place.
Since then, I have deepened my knowledge and experience of this approach. I discovered that the dimensions that had caught my attention were effectively articulated in a systemic way in the Toyota Production System (TPS): this learning system, with its integrating principles, methods, tools and postures, was designed to develop mastery of the right thing, deepen the knowledge over one’s job content and work environment, in order to create value for clients. A system that jointly allows each person to develop technical and relational skills on her workstation and develops autonomy, thus allowing each person to be more serene in her job.
When you start, it is not easy to imagine how it will work. But when a team gets started, and the manager understands how she can foster reflection and experimentation within her team, to improve overall performance through problem solving… wow… it’s awesome!
Once they have experimented with lean, few teams want to go back. Why? Because this system generates performance in the broadest sense: performance for all without opposing individual and collective interests within the company, with every individual understanding what they contribute to, with the added flexibility to propose ideas for improvement and be able to do “a well-done job”, one of the sources of professional pride. Without the need for change management…
The image that comes to me is that of an orchestra where everyone plays their own unique score and contributes to the overall musical piece, with each musician striving to do the right thing on their instrument, while synchronizing with others, in order to create a true harmony to share with their audience.
When I discovered Lean thinking 15 years ago, I valued this approach because it was based on the knowledge of the business, respect for people and inclusion. Today, I have come to understand how this approach achieves all this and goes even further. Lean is totally inclusive; it leaves no one to face their problem alone, neither the employee, nor the manager, nor the leaders, nor the client. For each individual, the Lean approach opens up a space for collective reflection and discussion to identify courses of action together to be implemented and learned from. To me, this inclusive approach is unique and essential to meet the challenges of today and tomorrow of each organization and for the whole society.
What makes Lean unique is the ability to change people’s lives, to inspire and enlighten individuals.
Lean changes lives. Indeed, I consider this the acid test for Lean: Are things getting better? Are lives changing? If the answer is yes, then you’re on the right track. This is why it deserves our enduring and relentless commitment and what makes it worth it.
There are a multitude of improvement approaches that focus on improved performance, cost containment, shareholder value, financial stability etc. Don’t get me wrong—all these outcomes are important. But what makes Lean unique is its ability to change people’s lives, to inspire and enlighten individuals. This is a differentiator and what lies at the heart of Lean.
“Wow! It’s liberating to have the time and space to think. It feels good. Escaping the never-ending spiral of firefighting and entering a world where I actually pause to solve stuff, has changed my life” (ICT call centre team leader).
“I used to feel my opinions didn’t matter so I learned to shut up and just get on with it. I also didn’t care. I would clock in and leave my brain at the door. Now I feel my ideas do actually matter; that I can see things management can’t see; that I can contribute in a meaningful way. It’s like a light has switched on in me and my manager” (financial administrator at a small manufacturing company).
I’ve seen this first hand. In 2014, we kicked off work in a selection of Johannesburg public hospitals that continues today. I’m the first to admit that in the beginning I was quietly concerned it wouldn’t work. As an optimist and a believer in Lean, it irked me that I felt this way. When we visited the hospitals we would observe overburdened staff and queues that exceeded capacity; and hear outcries from staff about the lack of budget and resources and how the little changes won’t make a difference: “Lean won’t work unless big money is spent on facility upgrades and more staff.” We would sit among patients and listen to their complaints about how they’d woken up at 3am to arrive at the hospital by 6am only to see the doctor later in the afternoon (sometimes the next day after sleeping on the benches!). We would also meet dedicated and exceptional people who wished to serve patients better and help make things easier.
I was over the moon when we started to see this Lean work take hold. Yes, I was proven wrong and learned my own lessons from the experience. And since then I’ve seen other hospitals making leaps in performance thanks to their hard work, belief in the approach and unwavering commitment. In one such hospital we have seen a reduction of up to 80% in neo-natal deaths as a direct result of their Lean efforts – would you say that changes lives? This obviously benefits the impact on mortality rates. But it also improves the lives of their families and the staff who take care of these patients; not to mention other factors as reducing litigation costs which could run into the hundreds of millions of taxpayers money.
There is nothing more nourishing to the soul than to witness demoralized, inhibited staff grow in their confidence and enthusiasm, and to see significant change unfold before their eyes as a result. While this trumps organizational performance, the good news is that developing human capability, with clear direction in hand, will lead to better organisational results too. A triple win for the employee, customer and organisation.
Lean is not a production system, nor is it a management system. It is a system for the learning and development of people.
The first time my company offered me the opportunity to “do Lean”, I was enthusiastic. What I was discovering, and which really interested me, was a new way to manage people. At that time, our Lean project was launched with huge support from the boss. He wanted to stimulate the generation of ideas from the teams, and was very focused on the bottom-up part of Lean.
In an interview for our company newsletter at the time, I talked about shared Leadership—a subject I had been passionate about since a management trainer introduced us to the distinction he articulated between participatory management and shared leadership. He elaborated on this by sharing two pictures. He illustrated the concept of “participatory management” with a picture of a herd of buffaloes, the largest and strongest being in front, followed by all the others. For “shared Leadership”, he showed a flight of wild geese, where the lead goose is regularly replaced (this is the most tiring position) while the team (the bird group) always continues in the right direction, in a beautiful V-shaped formation where everyone has their place at a given time. I was fascinated by this image, and for a long time I had been trying to be more of a “coach manager “, to make my teams grow and, beyond the success of the projects, to also target the development and sharing of the necessary knowledge.
I felt at the time that the Lean approach had a similar objective, even though I was far from understanding HOW the TPS targeted people’s development. To be completely honest, this first experience taught me that the road to hell is paved with good intentions. Bottom-up input without commensurate top-down activity is not worth much; and making people express themselves when the direction is unclear clear often only brings frustration Similarly, looking for a short-term ROI at each action, choosing delivery at the expense of discovery, short term over long term, puts a burden on the learning process and is absolutely not efficient. I have far too many examples of this!
By working with our client during the bid phase, we were able to show that the technical solutions he was trying to impose on us, to comply with all the requirements, were very expensive. By showing that we understood what they truly valued, we were able to propose a far more innovative technical solution, which we co-developed with them. A real success of discovery in a delivery mind set! Unfortunately, I have also experienced many projects that get lost in the infernal spiral of control, causing teams to lose all sense of initiative and discovering far too late that the technical solution is not feasible.
It was much later that I understood something essential: Lean is not a production system, nor is it a management system. It is a system for the learning and development of people. Working just-in-time (with Kanban) and stopping at every first defect (Jidoka) is a complete system designed to reveal and prioritize problems; and then engagement in structured problem-solving is a tool for people development. In a nutshell, Lean is a problem-solver’s development system, and not a problem-management system. Framed this way, Lean tools are visual tools that allow everyone to detect abnormal situations, and Lean managers serve as problem-solving teachers. All of this is done for the long-term benefit of customers and the company. Lean seeks to transform the control chain into a help chain, to change from “command and control” into “show the way and support”.
Why is Lean worth our unwavering commitment? Because it is a bet on intelligence, an approach to make people think and grow; because it is a response to a short-term, financial vision of enterprise. And also, because on the basis of these principles, it works!
Lean provides the tools and the values to create a workplace in which people have a sense of purpose, where they are trusted for their ability to think and contribute to something valuable, and where they are supported to succeed, every day and over the long haul.
According to a Gallup study, two thirds of workers have experienced burnout at least once in their career, with 23% saying they are always or often feeling burned out. And the millennial cohort shows that this problem is only getting worse: 84% of them report having experienced burnout at their current job and near half have left a job because of it, against 77% for all respondents (source: 2018 Burnout Survey by Deloitte). The report adds that job burnout is attributed to serious diseases and in some cases even death. These numbers are shocking!
Burnout is not just a human problem. It also has huge impacts on companies’ long-term stability: employee turnover and absenteeism, loss of motivation and reduced performance, or paid sick leave and healthcare spending.
The reasons for employee burnout include highly variable workloads, micromanagement or lack of support from management, unfair treatment at work, unreasonable deadlines, lack of recognition and autonomy, a sense of isolation and a feeling that their work is meaningless. All these translate into a deep mistrust for management. Job burnout has less to do with hard work and high-performance requirements than with how people are managed.
Burnout touches everyone in the organization, from the CEO to the operator. In the last two months, I’ve spoken with several CEOs or other C-levels who tell me that the stress of their job has become unsustainable, to a point where they are starting to feel burned out themselves. They complain about different things: difficulty getting people to follow the larger strategy and their lead, lack of cooperation among their departments, dealing with customer complaints and putting out fires daily, and so on. But this is just the other side of the coin. The hidden reason behind these stressful situations is that everyone in the company, from top to bottom, is failing to engage with the customer, collaborate with each other to create value, and show what they’re capable of.
So how do we resolve this burnout problem? Some companies launch low cost wellness programs like providing free fruit baskets or snacks, or more expensive ones like employee counselling, office redesign, or even flex time without reducing workload. Others just bite the bullet and try to convince everyone to power through the stress, hoping to attract investment so that their stock option is worth something later on. Other companies try reorganizations or process engineering. But all these approaches are just band-aids that do not address the deeper challenge: the need to create a work environment in which people have a sense of purpose, where they are trusted for their ability to think and contribute to something valuable, and where they are supported to succeed, every day and over the long haul. CEOs and their first line have a major role in this.
Lean provides the tools and values to achieve such a work environment, and at the same time help CEOs realize their strategy. Here are three aspects of lean which we can act on right now, to start creating safe and energizing work places:
Providing purpose: Management needs to clarify the company’s sacred mission, and frame it in a way such that everyone understands it and knows how they can contribute. When I ask CEOs what their mission is, and what they’re trying to achieve in the long run and why, I rarely get a straight answer. This question is particularly difficult because as soon as one arrives at work, the immediate requirements of the job we have to do, and the customers we must please, make thinking about the firm’s future a real mental effort.
Implementing Kanban: Kanban systems are the key to developing teamwork throughout the organization, levelling workloads, and fighting micro-management. A Kanban represents customer demand so people know whom they are working for and what value they are expected to deliver. Everyone understands clearly what needs to be achieved on any given day, they all see the next job in line so there can be no conflicting instructions coming from managers, and they learn to face obstacles together in case of stagnating Kanbans. Kanban systems require the implementation of a managerial chain of help to support employees and learn from process failures.
Engaging people in Kaizen: the objective of lean is to seek voluntary participation of everyone in improving quality, and removing waste, every day. The word “voluntary” here is important because people are at their best when they choose an objective and have a sense of autonomy in how to achieve it. The basic assumption is that a company’s competitiveness stems from the creative and ingenious ideas that people come up with to resolve problems revealed by the Kanban system. Kaizen is about providing the space and time for people to do just that.
I believe that lean is worth our unwavering commitment because it provides a real solution to stress and burnout for everyone in the company. It’s not magic, it’s a set of behaviours that people adopt, starting with the CEO. Lean starts with a desire to create humane and respectful work environments. The rest just takes practice and daily discipline. What are we waiting for to create a better business culture that the next generation can take pride in?
After an intense week of Lean training, we came to believe that everything we did could be be better.
We didn’t know what Toyota Production System meant. But our new VP Ops was so adamant, in fact he wouldn’t take our job unless we agreed to learn and try. What could be so important? We didn’t really have any better ideas. We had a great culture already and had done lots of training on people skills, but it wasn’t focused on the business. So, let’s give it a try.
We received some very minimal education and jumped right in with five simultaneous full week kaizen events. All the top leaders, as well as people from all parts of the company and from all levels, were on the teams. I was on the Conveyor kaizen team. We were a traditional company, with MRP scheduling and parts planning, Standard Cost accounting, work orders, and functional departments both inside and outside the manufacturing process.
I have always really liked manufacturing, even though my functional area was finance. I liked the people, I liked seeing the products made, and the full cycle from customer need to money in hand and customer satisfied. I never really liked silly rules and boring jobs. My mom had a business and I worked for her, so I felt fairly confident that I understood overall business methods.
But nothing prepared me for what I experienced along with the rest of the teams that week. After some basic education on pull, small batch, and waste, we got the green light, in a structured process, to change the work. Our owner was very brave and trustful to turn everything over to us. And he too was on a team, experiencing the same thing!
After that week, everything we did seemed like it could be made better. And as a finance person I never had experienced anything with such quick and obvious benefits for the customers, the employees and the company too. My eyes were opened.
Since that time, I have committed my life’s work to helping other people understand and see the benefits of lean thinking. I have met people I never dreamed I would meet. I have travelled the world in a way a young girl from Southern Indiana never imagined. I have been hugged and thanked by others whose eyes were opened. I have seen companies survive that were going to fail, saving jobs and creating hope. I continue to dream that every person can transform through lean thinking and create an amazing future for our next generations.
AUTHOR BIO: LEAN SENSEI WOMEN
Coming from different continents, horizons and professions, the individuals who form Lean Sensei Women are all recognized lean Senseis, who help companies and organizations build sustainable growth through lean management. They believe in the development of people, respectful of both teams and environment, with a view to produce more value for customers and to society.
Catherine Chabiron: Board Member, Institut Lean France. Author of Notes from the Gemba in Planet Lean and executive lean coach.
Jean Cunningham: Jean Cunningham, a former CFO and LEI board member, is widely recognized for her pioneering work in lean business management systems and the lean office. Her books include Real Numbers, The Value Add Accountant, and Easier, Simpler, Faster. She is Chairman of the Lean Enterprise Institute.
Lucy Liu: Currently the Head of Supply Chain Academy for Asahi Beverages, Australia and New Zealand. Over a 28-year stint with Toyota starting at the shop floor, she progressed to management roles include Australia TPS Office and Capability Development Department Manager.
Sandrine Olivencia: Lean sensei and member of Institut Lean France. Specialist in Obeya and product development expert for the digital world.
Cécile Roche: Lean sensei, member of the Institut Lean France, Lean Director of the Thales Group, and author of several books, in particular on Lean in Engineering.
Anne Lise Seltzer: Member of Institut Lean France. Lean Coach in Services and Support functions. Trainer for Lean & Learn at SOL France (learning organization).