If you are in the business of improvement, then you must use lean, 6 sigma or total quality tools. Or you have no credibility.
But does it make you effective?
The lean movement outside Toyota has been around for 30 years and yet it still only scores about 25% success rate (ref 1).
Why doesn’t it do better?
Some say ‘try harder’. Many say that the key part of the Toyota method is ‘respect for people’, ‘empowerment’ or something similar, and that this is still missing from most implementations. We need more ‘soft skills’, supposedly. And even if we had them, would we be able to fight the rising tide of shareholder power (“give me results this quarter”) over stakeholder power (“sustain and grow the community that the business feeds from and to”)? Big issues that ‘trying harder at lean’ will not solve.
That’s the context.
What does it mean for those who practice lean? Those whose job is to improve things?
One thing is for sure. You do not have job security. If 3/4 of the time you fail, those accountants aren’t going to want to keep paying you. I’ve certainly been there, although I jumped before I was pushed.
So what do you do…as an individual working as a change agent?
You have to take a different approach. You should think about improving yourself, as a person rather than as a professional. I mean Personal Development not Professional Development. Not another 5S or Taguchi or Poka Yoke program. I mean grow as a person. More Tony Robbins than Shigeo Shingo.
Because those failures are failures to change people’s minds. How do you do that if you can’t change your own mind? It starts with you.
Now I know that this is a scary thought for engineer types. In fact, I have to admit that I ran screaming from a live 2 day Tony Robbins event after only 4 hours of it. Luckily I have a partner who understood about Terror Barriers and the way through them. We learnt a model for understanding this that can be taught and that people can internalize.
We live in an ever faster changing world. You can see this in the strong reaction to it in all walks of life. The world needs change agents more than ever. But those change agents must be skilled in more than Lean. Then they will be really valuable.
There’s some learning to do. You need to get past your own terror, then you can help others.
Once you get past the terror, you will find freedom.
- Ignizio, James P. 2009. Optimizing Factory Performance: Cost-Effective Ways to Achieve Significant and Sustainable Improvement. 1st ed. Mcgraw-Hill Professional.
Or How to Provide Job Security for Lean Experts…
Joel Barker talked about the life cycle of paradigms in his 1992 book ‘Future Edge’.
His definition of the word ‘paradigm’ is more general than mine. He defines it as a consciously defined model or way of doing things that is useful because it solves lots of problems.
My own definition separates ‘paradigms’ from ‘models’ by saying that the paradigm is what you get when a model is sub-conscious. Despite this difference, we are in the same field, because we both care about how you change them.
He talks about the evolution of paradigms. In Phase A, they are being tried out, pioneered and tested on problems that had previously been poorly solved. In Phase B they pass into the mainstream and become adopted as the ‘go-to’ approach for (in this case) improving operations.
Lean and 6 Sigma have been mainstream for several decades, and so very much in Phase B.
But what happens to phase B paradigms?
They handle many situations, but not all. Over time, they accumulate unsolved problems. Sometimes a hammer is NOT the tool to use. Or perhaps I should say the philosophy does not help.
So what are the operational problems that Lean & 6 Sigma fail to solve?
Here are some that we have had to deal with:
• Argue against a proposed factory closure
• Reconcile supplier disputes
• Create co-operation between ‘rival’ sites
• Compare manufacturing systems of product concepts (during design)
…and some that we might have to deal with
• When to change to a new product concept
• Optimize new product design before start of manufacture
…and one that nobody talks about
• How to provide job security for lean experts
The solution to these is one or more new paradigms.
We have one: it’s the use of explicit models that force both parties to a disagreement to be clear about what they want.
But there are an infinity of other new paradigms that would work.
Lean and 6 sigma will keep you going for now.
Eventually you will need to adapt and adopt a new paradigm or two.
Suppose you work in a factory which is part of a larger group of companies.
What happens when the operations boss comes to visit you from head office?
He or she will congratulate you on your good work, meet and greet your staff…smile. However, you will always be left with an instruction to ‘keep it up’. This usually means ‘make your products cheaper next year…and the next’.
If you have been that good up to now, you know it is going to get harder and harder to reduce cost. You will feel that you are being driven against a steep mountain slope and being whipped into going up it.
Here’s what the operations boss knows. His marketing people are telling him that the gross margin of your products is being eroded and that to maintain profitability, unit manufacturing cost must keep coming down.
If there are alternative business approaches that you could take in the market, then you don’t have enough information to say and anyway it’s outside your authority.
If you are truly reaching the limit of cost reductions set by the inherent product design, then it is difficult to say so without the operations boss feeling that you lack determination. It would put your own future in jeopardy. .
The upshot is that you continue to work harder and harder to achieve less and less, until the time comes when the last cost reduction that makes any sense is to move the improvement people out and save their salaries. Your accountants will very quickly be able to tell you how much you will save in this scenario.
In the meantime, a number of increasingly (they have been getting better and better at improving) talented improvement people get more and more frustrated because they know they are achieving little in measurable results. Plus you will have to pay them.
To avoid this lose-lose situation, you need to know when to stop improving.
At that moment, you will also have to clearly decide: do we stay where we are, do we undertake a significant product redesign or do we explore different business improvement ideas that exploit the ability of manufacturing to be more flexible or responsive for the same cost?
Sometimes you have to read a book for just one insight.
The critics might be divided on whether it is a good book, but that one insight makes it gold in your eyes. I wouldn’t have read ‘Sapiens’ by Yuval Noah Harari, but for a good friend who recommended it. Then a few weeks later my brother gave me his copy and so I read it.
This was the insight.
Harari says that Homo Sapiens lived for many millennia alongside Neanderthals without immediately dominating them. So why did Sapiens become dominant? There seemed to be a number of environmental reasons. But what finally did it, he says, was Sapiens’ ability to co-operate with groups of people they did not know personally. If your influence is only with those you know, you are limited to about 150 people. When you co-operate with more, then your influence is far greater and your impact is far greater.
Sapiens succeeded over the Neanderthals because of their ability to spread common thinking beyond the immediate group. When you think the same, you act the same and so behave as a much larger cohesive and more powerful force. Who is more likely to prevail: 10 groups of 150 people who look superior but don’t have much in common with each other, or…1500 people who look inferior but think, talk and act in unison? We all know that power.
So how is this relevant to corporate life?
Well, how about ‘Standards’? There are formal ones, like ISO 9001. Or unspoken conventions, like cars having a steering wheel, the right hand pedal being for the fuel, the left hand pedal being for the brake. Imagine a world, where Fords had tiller steering, GM had a side joystick and the accelerator was on the dashboard? There is no question that the market in cars would not be as healthy as it is. Transport those standards to other countries, then you can sell your cars there. Plus you can find suppliers who can make components that will work for you better and cheaper. Everyone involved wins.
Co-operation with people you don’t know makes everyone’s life better. The impact of your ideas is far greater. In the case of Home Sapiens, it has led to dominance over the World.
The Next Big Leap in Productivity Improvement?
Was really intrigued by the article in the May-June 2018 Harvard Business Review describing the effect of a few drinks on people’s creativity.
I have long joked that the most creative marketing ideas come up in the bar after work. But, it seems that there is some truth in this.
So why do I bring the matter up?
Well, it’s another thread in my hunch. Which is that the next big leap in corporate productivity will not be a technology or organizational one, but rather a personal development one.
Now, before you get turned off by boring phrases like ‘corporate productivity’, ‘organisational’ or ‘personal development’, how about we call these ‘Shared Bonanza’, ‘People Going the Same Way’ and ‘Becoming More Aware’? I’ll follow up about all these phrases later. Meanwhile…
Creativity is the result of all this and creativity is what is desired. The world constantly needs new things, new experiences and new ways of doing things. These all have to be created. It feels like the constraint to growth everywhere and yet is somehow doesn’t find its way on to the agenda at Strategic Reviews. It’s either confined to the R&D folks or simply left to chance.
So having a few drinks may boost creativity. I am not suggesting it as a panacea, but the thought gets you thinking.
P.s. The same HBR article mentions that ‘editing’ is best done sober, so this article wasn’t completed in one session!