Chapter 5

Go Lean: Implementation Strategy, Startup, and Evolution

In This Chapter

Preparing for implementation

Starting the transformation

Moving past the starting line

A journey of a thousand miles begins with a single step.

— Lao-tzu

As you know by now, Lean is a journey. It is not a prescription, where you follow steps 1, 2, and 3 and — voila! — you’re there. It is not a one-size-fits-all continuous-improvement methodology. Lean is like the quest for perfect health: Your pursuit is multifaceted — nutrition, exercise, rest, beliefs. It requires discipline. It’s a way of life.

No two people pursue health in exactly the same way. Each person considers how his lifestyle, age, goals, and starting point set him up for pursuit of perfect health. Each person may consult with experts to develop a plan that will work for them in the short term and over the long haul. Everyone must continuously learn about new exercise options and health trends. As all these new developments occur, each person has to discern if the new information is relevant to his personal path. Ultimately, each person’s success requires discipline, a change of mindset, and the incorporation of healthy practices. Everyday healthy choices will lead to small incremental improvements. Although “perfect health” is an ideal state to strive for, staying the course moves you in the right direction.

An organization’s Lean journey is similar to this kind of quest. You have to assess your present state and determine the right Lean strategy, based on your specific goals, objectives, experience, and the current state of the organization. You change how you approach leadership in both mindset and actions. To be successful, the organization develops new disciplines and healthy practices. You may hire a sensei to start you on the right path to change.

When forming your strategy, don’t just copy someone like Toyota. Although Toyota’s history serves as a good reference, it’s not an exact blueprint for anyone else. You have to follow your own path, make your own adjustments, and find your own way.

In this chapter, we offer strategies and tips to help you begin your journey. You figure out how to prevent the “program-of-the-month” trap. And you see how to evolve from your starting point to a place of living Lean.

Preparing to Go Lean

Going Lean is rigorous, to be sure, but it’s more of an evolution than a revolution. Lean focuses on the means to achieving results just as much as it does on results themselves. You don’t solely measure your improvement progress by quarterly profit performance, although, over time, you experience improved performance in your financial measures as well as improvements to the other quadrant measures of the balanced scorecard.

Lean is a very action-oriented methodology; it includes the projects, kaizen events (see Chapter 9), and continuous learning. The planning process for a Lean initiative doesn’t require an elaborate production, but you must develop it to the point where everyone in the organization receives and is aligned to a clear, consistent vision and message about where they’re going and how they’ll be getting underway.

As you begin your Lean journey, you need to put a few things in place. The most successful organizations have top leadership own, live, lead, and encourage Lean, and expand it to all levels and corners of the enterprise. They also must put people, policies, resources and vision in place to ensure a successful journey.

Lean is easier than many other approaches because you don’t have to follow a singular prescribed rollout. You have a lot of latitude and leeway in your approach. But for the same reason, Lean can be more difficult than other approaches, because you don’t have a firm prescription to follow and a precise roadmap to fall back on. You need to chart your own course and find your own way. The good news is that, with Lean, finding your way tends to happen naturally. Start where you can have the biggest, most positive impact on your customer or where you can eliminate a significant issue or waste in your organization.

Starting from the top

Lean succeeds in the long term if and only if the management team is dedicated to the journey and has established and communicated a clear vision of where they want to take the organization. You may start Lean in any part of the organization, but if you want sustainable results beyond a small portion of the company — and who doesn’t? — the senior managers must endorse and actively participate in the effort. People respond to the cues they get from leadership at all levels — such as recognition, performance standards, and acceptable behaviors — especially in crisis situations.

Senior managers must understand the tools of Lean, the role that the people and culture play in sustainability, the importance of leading from gemba — where the action happens — and the philosophy of kaizen. They must practice Lean themselves in the course of their regular work routines. They must set a vision and communicate the messages of Lean. And they must follow up by performing Lean management actions (see Chapter 13).

Applying standardized work from the top down

Everyone in a Lean organization has standardized work. For people like the factory-floor assembler or call center employee, most of their work is standardized. Senior managers spend much of their time responding to interruptions, crises, and exceptions — and the rest of their time they spend brainstorming how to have fewer interruptions, crises, and exceptions! But senior managers have standardized work, too — not as much as the front-line worker, but they have it nonetheless. Lean managers use standardized methods such as Plan-Do-Check-Act (PDCA) when they respond to issues. They develop capability in the organization by understanding the issues thoroughly through knowing firsthand what’s happening, asking probing questions, and guiding problem solving. Their job is not to give solutions, but to guide their people to find the best solution.

Examples of where standardized work applies in senior management include gemba walks (see Chapter 13), standard reports, and the conduct of routine meetings, briefings, and structured reviews. This kind of work may amount to less than half the senior manager’s time, but when standardized, it enables the managers to work more effectively, freeing up time and resources for more value-added activities throughout the organization.

Focusing on the message and vision

Staff, directors, shareholders, analysts, suppliers, customers . . . all these constituents must know that you’re embarking on this Lean journey. You can’t take the journey by yourself and not tell anyone — they’ll all wonder where you’ve gone! You must set the vision for your new path and articulate the mission. Take the time to craft these messages, and convey them to the audiences as the journey begins.

You are starting a journey. Your messages need to inform and reflect that this is a change for the long term. There is a danger in flooding the organization with new buzz words and slogans. Be careful not to inadvertently fuel the program-of-the-month rumor mill by presenting Lean as the “next greatest thing.” Balance buzz with action.

The beauty of Lean for executives and senior managers is that it provides a toolkit with methods and techniques to back-up management’s classic platitudes. Some of these are:

We’re customer-centric! Management’s been touting this for years, but how could they really make it happen? Lean gives the executive the techniques to examine added value throughout the organization and conduct business operations from the customer’s point of view.

People are our most important resource! That’s the one you’re used to hearing right before the next round of layoffs. Lean teaches executives about true respect for employees, and provides the toolkit for safety, security, engagement, celebration, and growth.

Think win-win. Unfortunately, without a method, this one’s been only half-true: management’s win for themselves. Lean techniques enable managers to create a win for all parties.

Do it right the first time. (Also known as Quality is Job #1 — or, as they say in the software industry, Quality is Job 1.1 — i.e., fix the bugs in the next release!). But, how do you actually do it right the first time? You can’t test and rework products into submission. Lean, using statistical methods, poka-yoke (see Chapter 11), and other tools provides the basis for making this real.

Leading by example

In addition to performing standard work, the senior managers must also lead by setting the example. Managers translate the foreign and abstract concepts of Lean into practical behaviors that everyone can observe and emulate. They must change the way they think and react, especially in times of crisis. People will be watching to see if the managers are committed to the change to a Lean way of operating or if they’re just giving it lip service. Managers must also use visual controls. Charts, graphs, trends, and reports should be highly visible and apparent to everyone. The manager’s job is to reinforce the standard, notice non-conformance, investigate what is its root cause, and eliminate barriers to success.

Managers must exemplify discipline and accountability. They must perform to the expectations they set for others. They must hold themselves accountable, just as they expect everyone else to hold one another accountable. People will follow the leader — be sure you’re leading them in the right direction.

One of the most powerful showcases for Lean behavior is in meeting management. Managers should prepare for meetings and have a firm well-defined agenda, with the outcomes articulated explicitly. They must always arrive on time and finish on time — standardized work! When possible, conduct the meetings where the action happens — gemba. Consider stand-up meetings and challenge the “hour meeting” mindset.

Managers must also conduct the same Lean practices that they expect of everyone else, including going to gemba, developing and analyzing value-stream maps, participating in kaizen events and kaizen improvement projects, partaking in continuous training and learning, and overtly demonstrating regular, continuous improvements.

Creating the Lean infrastructure

Although there’s no standard recipe for a Lean deployment, you’ll need to put in place a framework of support elements before you begin the trip. You must acquire certain specific Lean expertise (see Finding the Master and Developing the Students in the next section). You need to disseminate Lean knowledge across the organization in a controlled manner. You must also bring in cooperative human resource practices, set up certain financial and accounting practices, and put in place some specific IT infrastructure. This support framework is critical to a successful rollout.

Adjusting the people policies

When moving into Lean from a traditional environment, you much change numerous personnel policies and practices in order to align with the people-centered principles of Lean. For example:

Incentive, recognition and reward systems traditionally focused on the individuals will have to expand to include individuals and teams.

Policies must support the realignment and reassignment of employees displaced due to productivity improvements.

Organizational structures and labor agreements, if applicable, will have to be adjusted to support a Lean environment. Frequently, this includes a reduction in the number of organizational levels, the consolidation of job categories, the ability to cross train, and flexible work rules.

Promotions will have to be based on performance, knowledge, and capability. The company may establish standard path progressions for multifunctional workers.

Acquiring training materials

Lean courseware includes formal training on the practices of kaizen and the Lean toolkit (see Chapters 10, 11, 12, and 13). Additional courses are available on organizational development, coaching/mentoring, communication skills, and change management. These courses are offered by numerous practitioners and training and consulting firms (see Chapter 19 for recommendations).

Most training firms typically prefer to perform the training for you, rather than license the training materials to you. If you’re embracing Lean fully and organically, you want to own the materials and have the ability to adapt them to your organization to use in a variety of settings and formats. But if you’re just sticking your toe in the water, you can either send people to training or bring the trainers to you.

Putting the people in place

To initiate the Lean effort, you have to put in place the logistical support pieces. People at all levels of the organization will need training. In addition, kaizen events must be scheduled and tracked. Outside resources like trainers, consultants, materials, and software tools will also need coordination. A core group of people will assemble to perform this work.

Make sure that you have the support resources to handle the volume of changes generated by the kaizen activities. You may need to pace the events so you don’t create muri or over stressing support departments like IT or maintenance.

Putting the support tools in place

The Lean practitioner uses software application tools as part of his optimization work. These tools include process mapping, value-stream mapping (VSM), statistical analysis, process orchestration and graphical mapping and charting tools. Some of these are individual desktop-computer tools, whereas others are shared by workgroups. The IT organization must include these in its cadre of applications support. Other software tools include programs for facility layouts and graphics packages for visual aides.

In addition to software tools, the Lean practitioner uses more traditional tools:

Markers and flip charts to record idea generation and team sessions.

Video cameras record the processes, enabling the team to analyze the film for improvement.

Digital cameras record before and after shots of the areas, particularly in conjunction with kaizen events.

Stopwatches establish and verify performance standards; use this data for line balancing and takt time (see Chapter 7) comparison.

A toolbox full of screwdrivers, wrenches, and hammers may come in handy for creating display boards, hanging visual aides or other improvement activities. And don’t forget the duct tape!

If your organization’s policies permit it, use your mobile devices to take photos or videos of the area. Be sure to transfer them from your mobile device to a centralized place where the team can access them.

Finding the Master and Developing the Students

One of the most famous sensei-student relationships was in the movie The Karate Kid (1984). Daniel, the new kid in town, is getting his butt kicked by the local karate bullies. Mr. Miyagi, a handyman and karate master, steps in and saves Daniel by fighting off the whole lot. Later and after much pestering by Daniel, Mr. Miyagi agrees to become his sensei, or teacher. When the lessons begin, Daniel does not understand Mr. Miyagi’s unconventional methods. His lessons include washing Mr. Miyagi’s car (“wax on, wax off”) and painting his fence (“brush up, brush down”). After Daniel blows up in frustration because he feels like he’s not learning anything, Mr. Miyagi points out to Daniel that he has been learning karate while doing these tasks. As a sensei, Mr. Miyagi has knowledge, experience, and his own unique way of passing on the knowledge. Mr. Miyagi demands that Daniel complete tasks in a precise way — focusing on the “how.” He also has the understanding that karate is not just the external techniques and moves, but also the internal belief in the heart and mind.

Lots of great references and books on Lean are out there (you’re reading the best introductory one, of course!), but you can’t gain the necessary experience from a book. Successful Lean organizations find a sensei or a master, not unlike Mr. Miyagi. The Lean sensei teaches, challenges, and guides the organization on their path to Lean implementation. The organization may not always understand the sensei’s methods at first, but eventually, with the right sensei, everyone in the organization finds themselves living Lean. In this section we tell you about the Lean sensei, and Lean students.

The Lean sensei

The Lean journey does not mandate a Lean sensei, but if you want to be successful, having a sensei is highly recommended. Many companies have found it beneficial to bring in an external Lean sensei when starting the Lean journey. A Lean sensei has knowledge of Lean principles, methods, and implementation. They guide and teach. Like Mr. Miyagi’s methods, their methods may be unconventional by traditional business standards. They also have a broad understanding that Lean is more than just the external techniques — to truly get Lean, you must change your attitudes, perceptions, and actions.

Identifying the role of a sensei

The sensei teaches the principles of Lean and guides the journey. The sensei lives where the action is in the organization. The sensei guides and teaches through gemba walks with individuals and small groups of managers. By questioning practices and processes, pointing out what is un-Lean in the process and focusing on waste elimination, the sensei teaches. Senseis may lead kaizen events, and don’t be surprised if you find them rolling up their sleeves and getting dirty with the details. They oversee — but do not own — the short- and long-term vision. Think of the sensei as the wise master, who will do just about anything to teach a point.

What are the benefits of having a Lean sensei? A sensei will

Jumpstart your initial Lean implementation.

Ensure your Lean efforts stay on course.

Offer a broad view of the organization to ensure constancy of purpose.

Customize the approach and materials based on the organization’s particular situation.

Provide tactical direction in support of the long-term vision.

Set high expectations, allowing your organization to achieve more than it thought possible

Produce results faster.

Serve as an independent observer and advisor.

Hiring a sensei

The Society of Manufacturing Engineers, the Association for Manufacturing Excellence, and the Shingo Prize have joined together to create a Lean Certification, but there is no unique credential for a Lean sensei. So how do you find a sensei? You can find candidates by contacting consulting companies (Shingijutsu Co., one of the sources of senseis in Japan, also operates globally), hiring a former employee from a Lean company such as Toyota, asking other Lean companies for references, and even searching the Internet. You will find an abundance of potential sensei candidates whose talents range from hack to expert. To find the one who is right for your organization, be clear about what you are looking for and how much you can afford to pay.

Before hiring a sensei, your company must understand its expectations and the background of the prospective sensei. Here are some questions to ask of yourself and the sensei:

Is our long term vision clear so the sensei can help us work toward it?

What are our expectations of a sensei?

Where did the sensei receive his training?

What experience does he have?

What expectations does the company have of the sensei?

How long does the company expect to rely on an outside resource?

What is the company willing to spend on a sensei?

Does the company intend to develop an internal sensei?

How many senseis do you need? It depends on the size of your company or operating units. You’re better off starting with one sensei and at one location. As your efforts increase, under the sensei’s guidance you may want to bring on more senseis. If you have more than one, make sure they’re in alignment. You don’t want too many cooks in the kitchen.

Organizations truly committed to Lean understand that they must continuously learn, stretch, and grow. To ensure that happens, you need a teacher and guide to show you the next step in the journey. Over time, is that teacher the same person or always an external resource? Probably not. You will likely find that your organization responds better to a different sensei as the journey progresses — not unlike your school experience where your kindergarten teacher was different from your high school teacher.

Agree upon performance expectations of the sensei as part of the original contract (for an external resource) or part of the performance appraisal (for an internal resource). At the end of the day, you’re looking for performance improvement in your operations. Connect the sensei’s activities with the organizational performance metrics.

Set up a formal mentoring process within your organization and build your own leadership capability to reduce your reliance on outside resources over the long term. As Lean becomes the way your organization does business, transition to having everyone own Lean as the way they do their business activities.

Senseis in the organization

Following the philosophy, “you can’t be a prophet in your own land”, a sensei is usually external to the organization — especially during the initial phases of implementation. In some cases, the sensei is a member of the management team who has a broad and deep knowledge of Lean. The sensei may also have experience from other companies or have previously been under the tutelage of an external sensei.

If the company sources its sensei internally, they must be granted proper authority and the backing of the management team. Don’t just deem a functional manager as sensei. Focus the sensei solely on Lean, and have them report directly to the highest levels of the organization.

Lean students

Every member of the Lean organization is a student of Lean. In an unending quest to improve, everyone must learn — constantly. But you won’t spend hours in a classroom — the majority of learning happens where the action is — in gemba. Every place becomes a classroom, and every situation becomes a class.

All levels of your organization will learn new skills as the Lean journey progresses. You will learn from classes, workshops, books, interactions with a sensei, on the job, from trial and error, from mistakes, from online blogs or other resources — the sources are endless.

To stay fresh and make daily improvements, everyone must continuously seek out knowledge. Particularly once you have worked in the same job or in the same area or with the same people for an extended period of time, you need fresh perspective, because you can easily get comfortable and stagnate. As a student of Lean, your responsibility is to seek knowledge daily. You may learn a new job, apply a new technique, learn about a different part of the value stream — learning is all around you!

You’ll know when you’re an advanced student of Lean: You will not only start applying Lean concepts beyond the workplace, but you will also look for Lean in everyday life. When you’ve taught your kids how to 5S their room and conduct gemba walks around your house, you’ll know that you’ve changed your thinking.

The ongoing Lean curriculum

The curriculum of a Lean student is not fixed. Sure, you need to learn the basics — like value-stream mapping, kaizen, elimination of waste, 5S, visual management, poke-yoke, kanban and all the other tools found in Parts III and VI of this book. But if you stop there, it’s like dropping out of grade school.

To become a Lean student, you must have knowledge and competency in at least four skill areas:

Technical skills in applying the tools of Lean, from kaizen to kanban, and everything in between

Leadership skills including coaching, empowerment, collaboration, service, conflict resolution, negotiations, teaming, and self-awareness

Strategy and planning skills including project planning and management, goal setting, and problem solving

Applied skills including demonstrated competency in the real world — where theory and practical application meet

As time passes, you may add pieces to the puzzle. Remember that your responsibility is to be a lifelong learner.

Lean certification

Although several types of Lean certifications are available, there are no standard industry certifications in Lean knowledge, skill, or demonstrated mastery. The whole notion of “Lean certification” is still developing. The Society of Manufacturing Engineers, the Association for Manufacturing Excellence, and the Shingo Prize sponsor lean certifications (see Chapter 19). Note also that Lean Six Sigma consultants have applied “belt” certifications based on a Six Sigma-style structure, but it’s not strictly Lean.

Lean certification is a mildly controversial topic. Not all Lean practitioners agree to the value of certification. After all, Lean is life-long learning. A certificate alone does not make you a Lean expert. In the end, only you can determine the value of a certificate. You may belong to an organization that esteems certificates and credentials, in which case certification may be of value.

If you select a certification program, choose one that has both theoretical and practical criteria. Lean knowledge is gained more from practical problem solving application than theoretical, classroom knowledge.

Most certification programs focus on the application of tools. Recognize that tools are only part of the equation. You need additional development in the culture, people, change, and leadership — Respect the People — part of Lean.

Beginning the Journey: The Lean Rollout

You can start Lean anywhere, in any place, and at any time. There’s no special magic place to begin. A common way to start the process is by performing a 5S (see Chapter 11) or a kaizen event (see Chapter 9) in an area of need or interest. This action begins the journey; then you ensure the journey is progressing by executing to a plan or a framework. Don’t make the rollout a big deal or burden it with bureaucratic management — keep it straight­forward and simple. It is Lean, after all.

Minding the big picture

True Lean is a process of small, incremental improvements. Sounds simple enough, except that these improvements are happening all over the enterprise, involving the entire organization, across multiple value streams, simultaneously. If you aren’t careful, things can get out of control. In this section, we share strategies to keep your Lean efforts on track.

Understanding the enterprise value streams

Within the context of the high-level value stream of the enterprise, most companies have many, many internal value streams. They also may have single areas, or monuments, that services multiple value streams, such as a large piece of equipment or a hospital lab. When the organization understands the many different value streams it has, and how those different value streams interrelate, the organization is better able to coordinate the improvement efforts and avoid sub-optimizing (improving one part of the enterprise at the peril of another).

Avoiding the Kaizen blitzkrieg

Especially in the beginning of the Lean journey, people are motivated to get something done — and now! Many organizations respond to this urgency by hosting as many kaizen events as they possibly can. They may set a metric for the number of kaizen activities performed. In response, everyone runs right out and checks off the “I did a kaizen!” box — without coordination, without a larger scale vision, without connection.

When all these blitzes are happening at once, you may minimize the results or create muri in the support departments, who try to assist everyone at once. One area may free up floor space, but it may be too small or in the wrong location to be useful or to amount to a true savings. In another scenario, one area may move the muda (see Chapter 6) to another part of the facility or value stream, without truly eliminating anything.

Don’t turn your kaizen blitz into a kaizen blitzkrieg — where instead of improvement, you leave only devastation behind. Build into your process ways to coordinate major kaizen activities, so that you yield overall improvements.

Kaizen events are a great way to start, but they need a proper scope, vision and tie to the performance objectives of the organization. If the events are random and have little positive results on the organization’s goals or positive impact to your customer, you can actually demoralize your organization, fuel the resistors, create a culture of negativity and doubt, and derail your progress.

Connecting the pieces

The Lean toolbox has an array of different tools (see Parts III and VI). The organization must understand how, when, and why the different tools are used. If you’re trying to level schedules and implement kanban (see Chapter 11), and yet your changeover times are still counted in days, you’re implementing the wrong tool at the wrong time. By understanding each tool in the toolkit, you’ll better match the implementation of the techniques to your particular situation.

Most organizations have other initiatives already occurring across the organization. These initiatives may be continuous-improvement initiatives or large-scale projects like an Enterprise Resource Planning (ERP) computer system implementation, or acquisitions of other organizations. You must define how all these things fit together.

Neglecting to connect the dots for the organization will cause confusion. Some people in the organization will be waiting for Lean to fail and will jump to the conclusion that Lean is just another program of the month. Showing the organization how it all fits together will help minimize the impact of these naysayers.

Keeping your finger on the pulse of the organization

As we discuss in Chapters 3 and 4, communication is the lifeblood of the Lean transformation. You need to take the pulse of the organization, continually. If people start reverting backward to un-Lean behaviors and tendencies, or moving off course, you need to be aware and correct it.

Communication activities should be two-way. Make them visual. Remember also to appeal to multiple learning styles, appropriate for the situation.

Enlist volunteers from various parts of the organization to act as a communication advisory team. This strategy will help you keep the message real, keep the movement consistent, and keep you connected to the pulse of the organization.

Picking the starting point

As an actor studies a role to bring art to life, he asks the question, “What’s my motivation?” When you’re bringing Lean to life in your organization, you, too, should ask yourself this question: What’s your motivation? Identify where you have the greatest pain points or the greatest opportunities that will impact the organization in a strategic manner or help you to serve your customer more effectively. Find your greatest motivation, and you’ve found your starting point.

Impact on the customer

The first place to look is where you have the greatest impact on the customer. Evaluate where you have strained customer relationships or value-creation, and identify the potential sources of the issues. Thoroughly define the problem by exploring potential causes and continue to refine the problem definition to focus your resources on the right problem. Use PDCA (see Chapter 9) to implement the first solution. Continue this process until you have closed the gap with your customer. Build the customer relationship through action and communication.

5S and the enterprise 5S blitz

5S areas where you can reduce waste or improve customer value (see Chapter 11). 5S is a powerful tool, and it helps people begin their Lean journey by “getting the house in order.” But be careful not to overdo it and go on a 5S blitz, or everyone will think you’re just a crazy compulsively neat person. That’s because 5S by itself is just a tool, and it’s most powerful when used in combination with other tools or in conjunction with a greater vision.

Quick visual improvement

To build momentum for a Lean initiative, apply measurement and visualization — creating transparency and providing feedback. Find a work area where visualization has an impact, and is quick and relevant, such as:

Removing an inventory warehouse or storage

Reducing setup times from hours to minutes

Reducing repair time for vehicles needed to support soldiers in the field

Wide-open spaces

If your motivation is to create space in your facility to accommodate new business, eliminate unnecessary real-estate, or bring workgroups together, you’ll want to create wide-open spaces. Free up large concentrated spaces in your facility. Start by conducting a series of coordinated kaizen and 5S activities to create the right space in the right location.

Creating awareness

In the beginning of your Lean journey, you want to create a buzz, get people excited, and engage them in your Lean efforts. As you progress, you want to keep the organization motivated and involved in the Lean transformation. Ultimately, you want your organization to live and breathe Lean. For this to happen, people need to know what’s going on and why it is important. In this section, we tell you how to create the initial buzz, improve communication and engage people for the long haul.

Communicating the reason(s)

Before describing the principles and practices of Lean, or why Lean has been selected as the approach to improvement, people need to know why the initiative is necessary. They need to hear and understand that something’s wrong with how things are working today, and that there are consequences if we don’t change our ways. They need to know what the consequences are; the risks of inaction. These reasons for change must be critically important, undeniable, and fundamentally impactful to everyone in the organization.

Leading by listening

Before rolling out a plan or approach, you need to know that people understand the reason for change and believe they must support a change initiative. Listening is the most powerful communication skills you can use. Whether you’re on an intentional gemba walk or hanging out at the water cooler, listening will enable you to gauge the pulse of the people. Figure 5-1 depicts an effective listening model.

Your ability to ask probing, open-ended questions will enhance your understanding and your people’s understanding.

Identifying the approach

Communicate your intention to implement a Lean approach to the organization. Describe why Lean is the preferred way to address the organization’s challenges. Make it personal for people; explain how Lean will affect them and make a difference in their lives. Be sure to communicate that this is a change in the way you are doing business, and that it’s not just a short-term special event. Maintain credibility by backing up your message up with consistent and congruent actions.

Highlighting progress

Create momentum from early progress by communicating successes. Let people know what has happened, why it’s important to them, what will happen next, how the next change is relevant for them, and reinforce the organizations long-term vision.

Highlighting progress is an on-going activity. Many organizations start strong when communicating progress, but lose their momentum over time. If people don’t hear about Lean advances, they may think you have abandoned your journey.

Reinforcing the long-term view

Constantly keeping the motivation and long-term vision in front of people will make Lean real for them, even if their area hasn’t yet started implementation. The message to the organization is that this is not about a kaizen here and there — Lean is about the long-term sustainability and viability of the organization as a whole.

Lean by doing

The best way to create awareness and understanding of Lean is to get involved. Get on a kaizen team, 5S your workspace, learn a new technique, and find a pertinent application for it. There is no better way to grasp the concepts of Lean than by actively participating and implementing improvements every day.

Avoiding program-of-the-month syndrome

Since the beginning of continuous-improvement time, battling program-of-the-month syndrome has been a challenge. As long as there are consultants, they will innovate and introduce new methodologies into the market. Or when movements lose steam, clever consultants and opportunists will repackage tools and techniques with a twist. Amidst these ebbing and flowing tides of methods and systems, companies committed to the Lean journey maintain their focus, keep the journey invigorated and determine how best to adapt to changing business conditions. In the following sections, we give you tips how to avoid the program-of-the-month syndrome.

Continuous communication

Communication remains important along your entire Lean journey. People need to know that you are truly committed, and that the organization is committed. They also need to discuss what’s happening, and how it affects them. If you do not communicate commitment, people will make things up, start rumors, or do nothing in hopes that “this too shall pass.” (See Chapter 4 for more about the importance of a communication strategy to help people change.)

Great expectations

By setting expectations with the staff, customers, stakeholders, and others, you support the Lean principles and establish the behaviors and tone for the organization. When you’re clear about the performance and behaviors you expect, and when you hold all the people in the organization accountable, they know that Lean is here for the long term and isn’t just a passing fancy. When you connect the dots for them in terms of Lean, you reinforce that Lean is the foundation. Communicate other activities or initiatives in the context of Lean.

Measurable outcomes

When you continually show measurable progress, you build momentum in the organization. As the momentum builds, you increase your progress. Staying the course with Lean — and keeping the momentum going — will show the organization that Lean is not just here for the short term.

Put the outcomes in terms that any individual can see and understand. Translate the impact to a personal level. The outcomes are not necessarily direct financial measures; they could be freed-up floor space, decreased time to serve a customer, a reduced approval chain, or anything that the individual can observe and use to verify the longer-term performance.

Walking the walk

If yesterday, you hailed the TLA (Three-Letter Acronym) improvement program, today you cheerlead the Charge 4 Lean, and tomorrow you’re touting The Ten Thetas, you’ll feed organizational frenzy. You’ll doom your improvement journey to a certain death at the hands of the cynics and naysayers — and you’ll deserve it. You must remain a serious practitioner and leader of a Lean process initiative. If you’re inconsistent and noncommittal, Lean will be just another bygone program of the month. As a practitioner, build capability through asking quality questions, guiding problem-solving, and understanding what is really happening in gemba.

Separating the wheat from the chaff: Handling new initiatives

New ideas and approaches emerge regularly. Don’t ignore them. Become familiar with them and develop a process to characterize them and determine your response. In many cases, “new” ideas are really just repackaged old ideas, so fundamentally, they offer nothing compelling. Technology is disruptive, so new whiz-bang IT solutions can offer speed, scale, and extensibility beyond local boundaries and manual effort. Most often, the new offerings are new tools that you can accommodate effectively into the Lean toolkit. As you evaluate the potential for new initiatives, ask yourself the following questions:

Does this initiative have potential relevance to the organization? If so, where in the organization does it fit?

Are there activities currently underway in these areas — within the organization and elsewhere? If so, what can we learn from them?

Is someone offering something fundamentally new, or is it a repackaging of what we already know?

How does this fit into Lean? Does our Lean initiative accommodate this?

Measurements: The enterprise at a glance

As you begin your Lean initiative, determine the relevant measurements for your organization. This may require you to measure things that you have not measured before. Most organizations commit the majority of their measurement focus to internal financials, but Lean practice compels you to balance your attention across a broader set of measures. These include customer, people, and process metrics.

Develop measurement capabilities in the following categories:

Customer: Satisfaction, net-promoter score, and measures across the value stream between them and their customers

Safety: Lost-time accidents, near-miss incidents, and repetitive-motion or ergonomic risk

People: Learning, proficiency, satisfaction, absenteeism, turnover, certifications or course work

Quality: Defects per million opportunities, defects by type and source, spills, rework, scrap

Delivery: On-time delivery, premium freight, total shipping cost per product, customer wait time

Value-stream costs: Inventory turns, cost per unit, cost per service hour; days outstanding, supplier payments

Tie your Lean implementation metrics to overall company performance metrics, to make the Lean implementation metrics meaningful from a business standpoint. A double-digit savings in floor space is great, but if you don’t have work to put in it, then the freed up floor space doesn’t mean much to the business.

Be sure that your metrics and incentives don’t conflict with one another, where meeting one objective is counterproductive to the achievement of another.

Localized within a value steam, add other measures — both process and outcome metrics — relevant to Lean implementation. Example metrics include:

Percent of team cross-trained

Performance to takt

Actual setup reduction versus target

Percent of kaizen events complete versus planned

Number of work orders completed to plan

A Lean leader must care and focus on both the results and the methods of how the people are creating the results. If you are getting results, but creating a lot of waste in the process, you are not implementing Lean.

Make information visual by delivering data in graphical form. Make the postings broadly visible and accessible. Post graphs of these metrics in communication stations across your facility and via your intranet.

Living Lean

After your Lean initiative gets its legs and begins to run, you’ve changed your organization forever. The positive effects of Lean are contagious, and the mindset of kaizen has a certain dogged determination and undeniable inevitability to it. As a result, over time, your enterprise Lean initiative will evolve into an ongoing, sustaining phase. This is when you know you’re living Lean.

The Lean evolution

The evolution of a Lean initiative begins with the rollout phase and moves into its sustaining phase sometime after you’ve trained everyone, performed kaizen events across the enterprise, and the positive results have occurred widely enough and consistently enough that everyone begins to believe in its power.

What happens then? Are you “done”? Have you “become Lean”? Can you now put the Lean techniques and methods and tools aside — thank you very much — and move on with your business? Absolutely not! You don’t put anything aside. You focus even more on your culture and the mindset you have created for your organization.

The minute you declare your organization “Lean” is the minute you’ve lost your way!

Inwardly Lean

The first Lean activities begin with training and kaizen events (see Chapters 9), usually in a selected department, program area or workgroup. Successful events give rise to larger improvement projects. These projects address a specific challenge area in a particular value stream, and involve time and effort on the part of a project team and the Lean sensei, who together apply the Lean toolkit to improve the process and outcomes. After a few projects have been successful and the positive results become visible, the participants begin to internalize the value, and they understand the power of the approach. Others begin to notice. People start initiating small projects in their work areas and as part of their workgroups.

The next step in the Lean evolution is to develop an enterprise project-oriented mindset, where you address challenges with Lean projects on a broader scale — both within their value streams and in concert with other value streams. Integrated enterprise value-stream activities will begin between organizations like marketing and IT or between design, operations, and customer service.

This is the point where everyone is “doing” Lean stuff. It’s a very exciting time: The organization is growing and learning, people are improving their work processes and environments, and the results are showing — in improved business productivity and performance. Figure 5-2 shows how Lean organizations evolve over time.

In a large organization, it takes years to reach a level of ubiquitous enterprise-wide Lean practice.

At some point, someone in the organization climbs the next rung on the evolution ladder. Instead of creating a project team to approach a challenge, he improves his part of the value stream on his own. No fanfare, no project team or official results — he makes the Nike marketing team proud and “just does it.” At this stage, the mechanical formalities begin to drop away and the mindsets begin to change. People begin to see the world through different eyes. They’re acting on instinct. PDCA is a habit. People’s performance is judged on Lean actions and progress. Lean is in their DNA.

Outwardly Lean

After people within their own work areas become comfortable with internal projects, they begin examining the cause-and-effect conditions that give rise to the waste in their segment of the value stream. Very quickly, this leads to an expansion of view: They begin to look outside their own world.

Groups begin to look up and down their value stream. They begin to suggest projects with suppliers, and other projects with customers. Eventually, this may lead to integrated value-stream projects involving suppliers, customers, and even the customers’ customers. Meanwhile, groups within the enterprise have begun to explore the relationships between them more fully.

All these are examples of outward Lean behavior. Outwardly, Lean is important because it represents the emergence of a systems view, the more holistic view of the organization and its life in the value chain. The external view provides the objectivity needed to adjust how the enterprise fits into the world. It promotes adaptivity — the ability to adapt and survive in the economic gene pool.

This adaptivity leads to a decrease in what’s known as functional sub- optimization (a phenomenon where a lot of time and effort is spent fixing problems in a function or area that doesn’t matter in the bigger picture).

Functional sub-optimization is a symptom of inward focus, where you think your world and your problems are the only ones that matter. Don’t be mistaken: Improving any area and removing waste from any value stream are the right things to do, but diverting enterprise resources to further strengthening a strong link in the chain when there are weak links all around isn’t a smart move.

Eliminating waste is just that: elimination. It’s not moving waste. Using logistics tools like postponement, third-party kitting, distribution centers, and topping up to move your waste to someone else is nothing more than sweeping dirt under the rug. Sure, your room looks clean, but the dirt is still there. Don’t move muda; eliminate it.

Practically Lean

Lean practice compels you to define your ideal state and continually work towards it. But be practical about how you approach your journey. You want to provide the best value to your customer, and you will have to challenge traditions and the traditional mindset of your organization to make progress. If you find your “next right step” for the organization seems contrary to pure Lean principles, but at the same time, it moves you in the right direction without creating excess waste, don’t stand on ceremony. Remember that no step or state is ever your final answer; it’s just the next right step. Establish the new standard, measure the outcomes, and conduct your next kaizen. Continually reassess to see how you can improve the solution — again, and again, and again.

Turnover due to high retirement levels or rapid changes in emerging markets may also be a reality. You need to apply a practical strategy as a leader in these situations. For the retirees, motivate knowledge transfer to build capability. For the high turnover in emerging markets, error-proof the processes and retain your key people.

Natural disasters are statistical probabilities, so be practical and plan for them. Don’t build excess inventories around the world — remember inventory is a form of waste and products in inventory are at risk to the same disasters. Work together with your suppliers, whom you have developed as long-term partners, to create contingency plans, especially on long lead-time or critical items.

Mature Lean organizations especially rely on Lean principles when crises arise. Organizations just beginning a Lean journey risk reverting to old behaviors when the going gets tough. When stuff happens, leaders must focus even more on the Lean culture and application of the Lean tools and principles. Use Lean principles and practices in crisis management planning from the beginning of your Lean journey.

After a crisis or disaster situation has passed, reflect on the people, processes, and outcomes, and improve your response plans for the future, based on what worked and what you learned.

Unleashing the mindset of kaizen

Vision is not enough; it must be combined with venture. It is not enough to stare up the steps; we must step up the stairs.

— Vaclav Havel

Lean learning is always performed in concert with application. The power of understanding is released by putting it into action. The Lean organization’s thirst for knowledge is complemented by the equally strong hunger for improvement. Lean organizations turn knowledge into progress.

Unleash the continuous-improvement mindset by fueling people’s thirst for more, and by providing comfort in the notion that no matter where we are or what we’ve achieved, we can always accomplish something better:

We can always know and delight our customers even more.

We can make our value chain even more effective.

We can create greater capability in our people and partners.

We can always find and remove more waste.

We can work to standards more consistently.

We can better balance the cycle time to the takt time.

We can remove more defects, reduce variation, and improve quality.

We can improve our application and leverage of technology.

Continuous improvement isn’t a death march. It’s not tireless drudgery. This isn’t an assault on Mount Everest. The maturing Lean organization doesn’t feed off Herculean victories; it thrives on constant progress. The Lean mindset, therefore, never has the need to rest on its laurels because it never tires out.

The Lean organization is like a long-distance runner, rather than a sprinter. Lean is a sustainable aerobic movement, leveraged through fitness, disciplined through training, maintained by momentum, fueled by balanced nutrition, and spiced by endorphins.

Facilitating with finance

The finance and accounting functions directly support the Lean journey by providing financial measures of the benefits and effectiveness of processes and operations as they’re transformed. This role is similar to the role of finance in a Six Sigma initiative, where improvements are independently measured and validated for their bottom-line financial impact.

There’s nothing like financial incentives to move the mountain. When Lean processes make money, everyone notices. The finance and accounting function is responsible for working with the Lean practitioners across the enterprise to define the key metrics that demonstrate the financial benefits that accrue from Lean process improvements.

Standard accounting practices and systems don’t capture, manage, analyze, or report financial information according to Lean practices. You need to develop specialized applications first, and then tune the financial systems over time, in order to implement financial practices that align with your Lean initiative. You can find many books in the market about Lean accounting to guide your development of these new practices.

Because Lean operations cut across traditional functional boundaries and generate new types of metrics, traditional accounting systems and measures don’t facilitate the Lean organization. Not having the right metrics can be a real problem. Remember the part about how the finance organizations are slow to change? When you ask them to change how they count the beans, you may encounter some resistance.

Now I am the master

Over the long term, as the Lean initiative progresses, everyone in the organization develops Lean abilities and masters certain tools and techniques. Over time, the novices become the masters. Expertise develops naturally from within.

As the initiative matures, the organization continues Lean principles and behaviors more by momentum and cultural predisposition than by impulse. It’s not a matter of who carries the torch, because everyone is carrying his own torch. Lean behaviors become ingrained, and, because organizations are slow to change, those behaviors don’t disappear. Continuous learning and improvement become cultural mainstays.

Still, management must maintain leadership and continue the Lean direction. They must continue to exhibit Lean behaviors, build capability and ensure the organization stays on course.

An enterprise doesn’t need to maintain a significant organizational entity to support the long-term Lean initiative. However, a core group is required:

To maintain, improve, guide, and focus the organization’s Lean practices.

To integrate Lean practices into other organizations — such as new suppliers, merger or acquisition partners, and new distributors.

To stay abreast of Lean developments and trends in other industries.

In the years to come, as you become a mature Lean organization, you must continue to invest in the people and the organization. People will flow through your organization; the new ones need to develop the same capabilities and cultural awareness as the old-timers, and the old-timers need to keep their skills fresh. Even the most successful organizations experience drift naturally over time. To minimize the drift, invest in your people, reinforce your culture, keep close to your customer, relentlessly look for ways to reduce waste, measure what you value and always remember for the long term where you ideally want to go — your ideal state.