Posted by: Knightbird | January 15, 2016

The Con Men and Who to Trust

I know this is a strange title for a blog on Lean Management, but I was motivated to write it after listening to author Maria Konnikova, author of “The Confidence Game: Why We Fall for It,” on National Public Radio [LINK HERE]. My reasons might become clear, but I am still working to put it into context. Part of my reason for vacillating is that many people have become so good at rationalizing their beliefs and although they might perpetrate a con on an individual, the actually believe in what they are doing. So I believe we have con men who know that’s what they are doing, and we have con men (and women) who believe that what they are doing is right. But I believe the result are just the same. By writing this, I am not pointing out any specific acts, but a pattern of behaviors that I believe exist that support poor performance in an organization. I have certainly heard my share of “stabbed in the back” stories. My only purpose is to make us aware of how important an ethical workplace and how Lean Management promotes it. This is not to say that ethical workplaces don’t exist without Lean.

A “Chaotic” work place is a complex environment, and it does work to some extent. We hire Executives to manage companies based on their credentials, experience and results. Every Executive tells stories that put themselves in a good light. I am reminded of “Chainsaw Al” Dunlap, who had a reputation of budget cutting extreme. He was hired by Sunbeam and proceeded to drive them into bankruptcy. Most executives just fail to perform. And because of the culture of criticism avoidance, we don’t say too much that’s negative about executives. After all, they do have to get another job after they do nothing for an organization. Of course, there are executives who do a good job. But how much of that good job is due to fortunate circumstance, and how much to great management? As Ms. Konnikova points out in her interview, con artists are just really nice people and they make you want to like them. They do a background check on you. They are complimentary about your past work. The engage you on your own turf and make you like them. While I don’t believe most con men are intentionally perpetrating a con, they do manage to use an organization for their own benefit, predominantly through salary and benefits. Given what Lean has taught me about companies that do not know what good management is, it is relative easy for some people to use that for their own gain.

Virginia Mason describes what they refer to as Capes, people who have mastered the Chaos, know what management wants, and are able to deliver results through elaborate workarounds. The know who to go to, who to avoid and how to get a result even if it means stretching ethical boundaries.

Others manage by shifting blame and proving they can manage by isolating and eliminating who the identify as problem employees. This type of organization has spies, multitudes of reports and rampant finger pointing. If a poor result is reached, the executive is fired. Fear is used to maintain results and force employees to work harder. But the hard work is not team based. It becomes an effort to shield yourself from punitive executives. But when I say punitive, it is always with an explanation. And for many reasons, that is all that is needed. When you let an employee go, you lay some blame on the reason for letting them go, but never really examine the true root cause of the problem(s) they are blamed for allowing to happen.

But I believe more prevalent is how a relationship develops between a board member (politician) and an executive. Most CEO’s become very aware of board member statements and make sure they respond to them, even if they are not good ideas. We have a term in Alaska for professional board members—“per diem Indians.” Many for profit corporations pay their board members for serving. Sometimes its a lot. And publicly traded companies often provide their board members with stock or stock options for payment, in anticipation that if the advice they give helps the corporation become more profitable, their stock will rise and they will benefit.

A true Lean Organization minimizes issues of this type. First of all, a Lean Executive will achieve outstanding results if they truly understand Lean, or make a commitment to understand it. A Lean Executive will be able to explain performance using statistical performance measures. A new style of reporting will need to be learned by any board employing a Lean Executive, and they will have to start thinking systemically while they eliminate their blame and shame culture. After all, Dr. Deming stated as one of his 14 points the goal of eliminating performance reviews. After all, a Lean employee and the team they work in are reviewed every day, by themselves. By understanding Takt Time, Cycle Time, Pull Systems, Elimination of Waste and Standard Work, they are already working at much higher level than their competitors.

Now I think this is a much tougher sell to an individual board member who has become accustomed to special treatment. A prime measurement tool for Lean processes is the control chart. When a Chaotic workplace experiences a defect that comes to the attention of a politician, the reaction is typical. They approach the CEO and complain. The CEO wants to get to the bottom of the complaint and approaches the manager, who approaches the employee closest to the problem and complains. Fix it or else. So the employee will do whatever it takes to resolve the problem. But they won’t fix the problem. And by addressing this one defect, they might create more work by establishing a regular report to make sure it doesn’t happen again. And the report eventually fades into memory, but is still made. So one report doesn’t really hurt us, does it? Wrong. My Lean Champion at one workplace asked a finance staffer about a report being done on a weekly basis. They didn’t know why the report was done, they just did it. When the Manager of the department was asked how the report was used, they said it wasn’t. It got filed. It was most likely a safety valve that could be pulled out by an executive to avoid blame by a board. See, I am managing my department. In fact, this report took 2 hours a week to compile and prepare, so after 52 weeks, it cost the company 104 hours of time, or essential 2.75 work weeks. That is one plus paychecks for a report that will likely never be used.

If a board and CEO can effectively transition to a Lean Culture, with Respect for People and Continuous Improvement applied to the entire organization, we begin to eliminate opportunity for con men, both intentional and non-intentional. A Lean System is so much more difficult to game. That’s not to say it can’t be done, but it becomes more difficult.

Oh, and a lot of consultants game organizations. They come in promising great results, but don’t really deliver any. I have seen lots of flavor of the day projects delivered by consultants with almost no benefit, and often considerable detriment. There are good consultants out there, but many will sell an off the shelf product without changing the culture. As a Lean Expert, I can make change without changing the culture. But it’s not sustainable.

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