Posted by: knightbird | February 18, 2015

Lean Cultural Change

In my experience, employees very quickly learn to appreciate Lean Thinking, if implemented the right way. The problems I have had are with managers. I have also fielded questions about how a Lean Executive works with Unions. Lean Executives need to accept that introducing an organization to Lean Management requires a strategic approach and the CEO must be fully committed to change. Vision, mission and direction need to be clear. Implementation must be consistent and a lot of effort spent to align all levels of your organization with the strategic goal for implementing Lean Thinking.

Look at your organization as having 3 levels of constituencies:

  • The Worker level includes everyone engaged performing labor to produce goods or services. Their Lean Thinking is team based, Visually Managed and focused on continuous improvement and elimination of waste. Workers are engaged in team improvement of Value Streams, identification of standard work and preventing defective work from advancing.
  • The mid level and senior Executive manager levels include all managers who are responsible for functions that are included in Value Streams. As you move from an organization with operations conducted in Silo’s to an organization managed by Value Streams, they will need to learn a variety of new management skills. And Visual Management of Value Streams is such a different way of managing. Because the skills they learned on their way up have changed, they need coaching and mentoring from the CEO.
  • The C Suite is responsible for the strategic implementation of Lean Thinking. This requires learning about the Lean Tool kit, understanding a Visual Management System and providing coaching, training and mentoring for their reports.

John Shook spoke about how to effect change in an organization:

“What my NUMMI experience taught me that was so powerful was that the way to change culture is not to first change how people think, but instead to start by changing how people behave—and what they do. Those of us trying to change our organization’s culture need to define the things we want to do, the ways we want to behave as well as want each other to behave, to provide training as well as then to do what is necessary to reinforce those behaviors. The culture will change as a result.”

I have advised Executives to put a support organization in place before the lean implementation. My Sensei referred to this as a “Kaizen Promotion Office.” Hire a Lean Sensei and staff who can train employees and conduct Kaizen and Kaikaku. My recommendation is that your Lean promotion staff learns the art of Humble Inquiry, often referred to as the gentle art of asking questions instead of telling employees. Any improvement event should allow for the employees to explore the Value Stream and improve it. The Sensei can guide the team with appropriate coaching and use of tools. Believe me, the improvement ideas will roll out rapidly using this approach.

Americans are competitive. And mid-level and Senior Executives are among the most aggressive that group. It can be difficult to channel their experience in a new direction. I was fortunate to have executives and managers who joined the Lean Thinking change effort.

Today, my advice is to include your direct reports in a strategic conversation, called Hoshin. Lean Implementation is a strategic effort. You are pointing the business in a direction that needs buy in. By allowing your direct reports to go to Lean Training, they will learn about the system of management and make connection with other leaders who have been there. It allows them to understand your reasons for changing the organization’s culture. I had my finance directors attend a Lean Accounting conference, and other executives attend both Lean Management and Training Within Industry conferences. Your direct reports should be having the same conversations with their reports as well through the process of Hoshin.

And it’s important to talk about the Visual Management system and implement it from the start. Your Sensei can help set the Visual Management System up. You will also need to talk to your direct reports about changes in key performance indicators. Increased sales are not the way to profitability. Instead, it’s increased sales with lowered costs of production, improved quality and quick response time. So you need to measure lowered costs of production, improved quality and quick response time.

The direct reports who didn’t buy in exhibited some common behaviors. First, some will tell you what you want to hear. They are totally bought in to your face and will appear to be working towards the common strategic goal. Behind your back, they are ignoring you and attempting to keep their reports in their silo. Second, others will try a political approach and try to enlist members of the board and community to oppose the strategy. And some will outright resist in a power play. If you are lucky, they will quit. If not, as Jim Collins advises in his Good to Great research, you need to help them “off the bus.”

If you don’t believe you can implement a cultural change, and don’t have a plan on how to do, I recommend not implementing Lean. Without the cultural components, it is just another fad. If you fail, it will just add to another long list of fads that have failed.

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