Saturday, December 5, 2015

Did Ohno Miss Something?

“The basis of the Toyota production system is the absolute elimination of waste.” – Taiichi Ohno

Every now and then, I like to go back and reread books I’ve read in the past to be reminded of important points that I’ve either forgotten or just missed the first time around.  This is particularly true of books by, or related to W. Edwards Deming, Peter Drucker, and Taiichi Ohno.  Recently, I reread Ohno’s The Toyota Production System: Beyond Large-Scale Production.  Each time I read this book, I get a better understanding of the thinking behind the development of TPS, including how I can address a number of organizational problems I face that I’ve been unable to resolve.

This time around, though, there was one point that kept coming up and I couldn’t get past.  Throughout the book, Ohno repeats the idea the TPS is completely about eliminating waste.  The issue I had with this is that, in my experience, people who focus lean efforts only on waste tend to get overly focused on the tools and end up working a number of disconnected problems that result in little sustained improvement.

A more subtle message in the book that I don’t believe gets as much attention as the elimination of waste is the challenge that Kiichiro Toyoda put forth regarding the need to “catch up with America in three years.”  Ohno writes very fondly about Toyoda, including how important he was to Japanese industry and the development of TPS.  He credits Toyoda’s statement as being inspirational, but rather than being the drive for the development of TPS, translates it into a call for the elimination of waste.

So Much More than Waste

Perhaps Ohno’s view of waste is more complex than most people can truly comprehend, but I think that the message of using lean to reduce waste has gotten so watered down that most companies fail to achieve the big gains that a true transformation can achieve.

When the focus is waste reduction, lean can easily become a toolbox to reduce costs.  In my experience, every organization that turns its lean effort toward cost reduction fails to sustain the improvements and eventually drops the effort when something else draws its attention.

I contend that the focus of lean should be the company’s vision.  This assumes that the organization has a vision and that it’s truly inspirational.  In Toyota’s case, the vision was to catch up with America.  Other companies that have been successful with lean tend to have equally inspirational vision statements.

Deming said that a company’s vision is a value judgement and must include plans for the future.  This means that it includes much more than profits or share price.  It must relate to providing better and better value to the company’s stakeholders, including customers, employees, suppliers, the community, and shareholders.  It is the focus on improving the value to all stakeholders to a level never before achieved (or even conceived) that provides inspiration. 

When the organization has a clear statement that inspires people, lean becomes the vehicle to make it happen.  It provides a method for everyone in the organization to align efforts and work together to drive sustained and never-ending improvement.  The effort begins with the vision and translates it into more and more detail as it works through the company’s long-term objectives, annual plans, dashboards, meeting rhythm, and daily problem-solving. 

It is through the alignment of these efforts, beginning with a clear and inspirational vision, that lean enables innovation and an obsessive focus on closing the gaps that are truly important to the organization.  And when lean efforts are anchored by the vision, people will not be distracted by the numerous management fads that can derail the effort.

What Did Ohno Mean?


We’ll never get inside of Ohno’s head to understand whether or not the vision of catching up to America in three years is what truly inspired the development of TPS.  It is only my interpretation that the vision is what leads to sustained gains and what drives lean at Toyota.  Perhaps I’ll see this more clearly the next time I read the book . . . or perhaps I’ll find something else I completely missed this time.

Sunday, September 20, 2015

Is it Better to Work on Strengths or Weaknesses?

It takes far less energy to move from first-rate performance to excellence than it does to move from incompetence to mediocrity. – Peter Drucker
Throughout my career, I’ve put a lot of effort into overcoming my weaknesses.  As a result of coaching and reading numerous books and articles on self-development, I have always viewed my weaknesses as barriers to success and something that I needed to work hard to overcome.  I’ve recently begun to wonder, though, whether focusing too heavily on my weaknesses took time that could have been better spent developing my strengths.
In The Effective Executive, Peter Drucker wrote that, by focusing on our weaknesses, the best we can achieve is mediocrity.  On the other hand, working to further developing our strengths can result in greatness.
Most people excel in the areas that motivate them.  Alternatively, weaknesses tend to come from the things in which people are not really interested.  Focusing attention on developing the things people either can’t improve or aren’t interested in improving can lead to frustration, stress, and an overall lack of motivation.
People are motivated when they are able to do meaningful work, learn and develop, and have fun.  And continually developing in an area of strength and utilizing the strength to contribute to an organization’s success help make this happen.
Addressing the Organization’s Weaknesses
It is obviously important to understand and continually close the critical skill gaps that exist within an organization.  Doing this effectively requires hiring the “right” people and continually making them “more right.”  One of the critical objectives of hiring is to put together a team where individual strengths complement one another and people are able to effectively cover each other’s weaknesses, but focusing the hiring process on minimizing the organization’s weaknesses, however, will never lead to greatness.
The performance review process in most organizations targets an individual’s weaknesses.  Although strengths are usually identified – although more in terms of results than the fundamental strength that led to the result – the individual is often expected to work on the weaknesses before the next review.  There is rarely conversation about how the person can further develop strengths during the coming year.
Knowing Your Strengths
Developing your strengths assumes that you know your strengths.  For most of my career, I have approached people and asked for feedback and coaching about my work, interactions with others, and overall performance.  Whenever I have these conversations, however, I try to get the other person to talk about the areas in which I need to improve – in other words, my weaknesses.  Lately however, I’ve tried to turn the discussion around and have asked for feedback on my strengths.  What I’ve found is that it puts the other person much more at ease and comfortable giving me the feedback I need to improve.
Although this has helped improve the conversation, I have found that it is important for the other person to know that I’m not looking for compliments.  I am looking for feedback on my areas of strength where, if I got even stronger, could greatly help the organization and my own career.
Like anything, this type of conversation takes practice to provide real value, so it is important to stick with it and be consistent about holding the meetings.
PDSA to Understand & Develop Strengths
To better understand strengths and weaknesses, Peter Drucker suggested writing down goals related to a specific objective or project.  After six months or so, he recommended returning to the list and reflecting on which goals were achieved and which were not.  After doing this over a period of time, a picture will start to emerge that identifies strengths and weaknesses.  In addition to showing strengths and weaknesses in execution, it will show how strong the person is in planning and selecting the right things on which to work.
This is closely aligned with W. Edwards Deming’s Theory of Knowledge and the Plan-Do-Study-Act (PDSA) Cycle.  Within a PDSA mindset, learning only takes place when the hypothesis is clear, which means that the person or team clearly and consciously understands the expected results from a given action or plan.  I believe Drucker’s advice deals with applying PDSA on a personal level to drive learning.
For this approach to be successful, I believe that the list must be remain personal.  As soon as something like this becomes public or part of a person’s performance review, there will be a tendency to skew results and show more success than really occurred and, as a result, interfere with reflection and learning.  Most organizations are not mature enough in their thinking for people to be truly open about their performance and, in particular, their weaknesses. 
It’s Not All or Nothing
Focusing on your strengths does not mean completely ignoring your weaknesses.  This is not about developing knowledge or a particular skill.  It is about using knowledge and skills to be successful.  If you have a weakness that is interfering with success, the more you know about it and address it, the more successfully you will be.  The key, though, is to avoid spending significant time overcoming a weakness.  Once it is addressed to the point where it no longer interferes with using your strengths to be successful, stop worrying about it and refocus on your strengths.

Monday, September 7, 2015

Confidence and Humility: Two Critical Leadership Characteristics

There are many traits that make one an effective leader.  Among the most important of these are confidence and humility, two attributes that many think cannot coexist in the same person.  I have found, however, that confidence and humility actually work together to improve the ability to lead and, although some people tend to possess these traits more naturally than others, they can be developed through effective coaching and feedback.
Confidence enables a leader to possess an unwavering commitment to purpose and direction of a team, while humility opens the leader up to continual learning.  And when defining confidence as self-assurance resulting from demonstrated capabilities, it is not possible to possess or have true self-assurance without the commitment to continual learning.
CONFIDENCE
W. Edwards Deming listed constancy of purpose as the first of his 14 points for effective leadership and lack of it as a deadly disease or barrier to improving business performance. Without clarity and confidence in the purpose of a business, a leader and/or those within the organization will continually question the direction and continually jump to the issue of the day resulting in very short-term, if any, success.
Confidence resulting from true abilities and understanding of the business, on the other hand, can give the leader the assurance that the purpose is correct, and prevent the daily distractions from taking the organization off course.
Another aspect of confidence is the belief that developing the abilities of team members is not a threat to the leader’s power or position, but a necessity to maintain it successfully.  A confident leader makes developing people, including the next set of leaders, a top priority for the business. 
Many people tend to confuse confidence and arrogance.  The characteristics of confidence that make it a vital leadership trait are not present in ones who display arrogance.  Discussions that include condescending remarks, as well as an overall lack of focus on developing others are clear signs of arrogance rather than confidence.  Conveying negative energy, a lack of openness to questioning of decisions and actions, and overall uncomfortableness are other characteristics of arrogant leaders.
Basically, people want to be around confident leaders but will do whatever they can to avoid arrogant ones.
HUMILITY
As mentioned above, humility gives people the belief that there is much they don’t know and lead to the desire to continually learn.  Humility enables a leaders to comfortably use inquiry when attempting to investigate a problem or develop the skills of team members because they don’t worry about others questioning their knowledge or abilities. 
Leaders who lack humility have trouble with structured problem-solving because of the tendency to jump to the countermeasure without truly understanding the root causes of a problem.  The kaizen process only works when an individual or team go into it with an open mind and the realization that they don’t always know the answer.  To do this effectively requires humility.
WORKING TOGETHER
When possessed together, humility and confidence can drive leaders toward constancy of purpose for the area they lead, along with the PDSA mindset needed to continually adjust the approach to remain on course.  When the leader models these behaviors regularly, people will be more receptive to following him or her and adopting the same traits in their own work.

Wednesday, September 2, 2015

A Simple Method for Achieving the Vision

The best way to predict the future is to create it.” – Peter Drucker
Many companies today have vision statements that are well-written and effectively describe future organizational aspirations. One has to wonder, though, that as common as they are, and as long as organizations have been doing vision statements, why so many companies continue to have trouble staying focused and miss the mark. Rather than staying focused and driving toward the future, organizational ADHD takes over and the vision turns into a virtually meaningless slogan.
One of the biggest reasons for failing to achieve the vision is a lack of understanding and appreciation of what a vision can truly do for an organization. A vision should be carefully created around what the company is expected to become over the next 5-10 years (or whatever time period makes sense for the company). It must be meaningful and able to drive all planning and improvement activities for the organization. It is a deliberate aspiration for the company; not something to be used only when convenient.
A Simple Solution
Achieving the vision is a simple process of understanding where the company wants to go, where is currently is, and continually closing the gap between the two. Just because the process is simple, though, does not make it easy. Without keeping the approach simple – and frankly most companies do not keep it simple – there is no chance of making it successful.
This post is meant to address the how of achieving the vision rather than the what. There is a process for creating effective vision statements that some leaders have obviously done very well. The method covered here assumes that the vision statement is one that clearly and effectively describes what the organization wants to become in the future.
  1. Define the Gap In the same way that a problem on the shop floor requires first to define the gap, achieving the vision requires understanding how far the organization is from the its ideal targets.
    Determining the gap involves breaking down the vision, which is often stated as a generalization, into specific 3-5 year objectives (which often include targets for safety, quality, production/schedule, and cost, although other areas can be covered). The objectives are regularly compared to current performance to determine the gaps that needs to be closed to move the organization closer to the vision.
  2. Set Annual Targets The 3-5 year targets become annual targets for different areas of the organization. Individual teams create their plans to achieve the targets, keeping the leadership team in the loop throughout the year.  The annual targets are deployed through the catchball process to ensure buy-in throughout the organization and to give the leader confidence that those accepting the objectives understand the intent as well as the targets.
  3. Establish Regular Meeting Rhythm There needs to be regular meetings to ensure: (1) the annual targets are being met; and (2) the organization is closing the gaps toward the 3-5 year objectives and ultimately the vision. The meetings are focused on problems in achieving the targets and closing the gaps toward the vision. The term rhythm is important here because the meetings need to happen on regular intervals based on the pace of the business. The key is to meet frequently enough to allow corrections to be made before things get too far off course.
    It is also important to remember that the rhythm meetings are not witch hunts. They are meant to ensure that problems are being handled effectively and to identify where additional help is needed. To keep the meetings focused, it is necessary to run them from the dashboards and only refer to the plans when needed to address a particular problem.  This keeps everyone focused on the same things, looking at the same data, and removes debate and confusion about where the problems lie.
  4. Repeat the Process Steps 1-3 need to happen every year to keep the team focused on the vision and to make sure the gaps are closing effectively.
The above process is a method that successful companies have used to turn their vision from a generalized statement of hopes and aspirations into a deliberate attempt to create the future. Developing and communicating the vision, when done correctly, can be energizing and motivating for the organization. Without a process for making it happen, though, the motivation, as well as the improvements driven, will likely not last.

Sunday, August 23, 2015

Should HR Make All Hiring Decisions?

One of the biggest problems companies have that interferes with long-term success is variation in people, team, and leadership styles throughout the organization.  This variation wreaks havoc with the company’s culture and leads to a host of problems that directly and indirectly affects performance.
An organization’s hiring process contributes directly to variation in personality, values, and leadership style.  In most companies, the hiring decision is made by the manager to whom the person will ultimately report which often leads to hiring people who are a fit for the manager’s style rather than the style of the organization.  The manager also has a need that, depending on the pressure to fill that need quickly, may drive the decision to hire someone without proper consideration to alignment of the person’s personality and values to those of the organization.
This sounds like an exaggeration but it is something that happens every day in many companies.  Unless the organization has a clear idea of its desired culture and the DNA of its people, and has a method to screen candidates to assure a proper match, its chances of creating the desired culture are very small.
Let Human Resources Do It
Giving human resources the power to make the hiring decisions is not a very popular viewpoint.  People complain that the HR team does not have the knowledge to hire the right person and is too disconnected to the workplace to effectively carry out the process.  When looked at in light of the long-term cultural ramifications, however, centralizing the hiring process within the HR team begins to make sense.  Some of the reasons for this include:
  • They touch all areas of the company and have a better understanding of the overall system than someone whose work is limited to a specific function;
  • Having an independent team handling hiring ensures consistency across the organization. They can make sure that the decision is based on competency as well as a fit to the company’s culture, which can reduce the hiring of friends or making a quick decision because of an immediate need;
  • It puts the responsibility of protecting the company DNA in one area that can continually close gaps in attempting to hire the perfect employee;
  • Like any process, the more hiring is handled by one team, the better they will get at performing the process. When hiring is decentralized, managers across the company do it so seldom that they never really get good at it.
There are obviously some basic elements that enable a centralized hiring process to work effectively.  First and foremost, human resource professionals need to spend a significant amount of time at gemba connecting with teams and working to understand the problems the teams face on a daily basis.  One way to help this is to rotate team members into human resources assignments on a regular basis.  Doing this will help HR better understand the areas they serve as well as having those served to understand human resource systems and methods.
Another important requirement to ensure the success of the process includes having a clear definition of the organization’s DNA and an understanding of how well the process is performing in terms of screening candidates for the DNA.
Finally, centralizing the hiring decisions within the human resource function requires HR team members to be responsive to the needs of its customers.  Although it may take time to find the right candidates, the process must continue to move until the position is filled.
I am not a human resource professional but having faced the numerous problems caused by variation in the hiring process, I’ve come to the conclusion that centralizing it is the best approach for most organizations.  If culture is truly valued as critical to long-term performance, we should always be looking for better ways to create it in a way that provides a true competitive advantage.  The hiring process has such a large impact on culture that it is a logical place to begin looking to understand whether it helps or hurts the company’s efforts to improve.

Sunday, August 16, 2015

A Solution Without a Problem

You are non-value added, Charles,” I was told. “Your sole job is to take care of the team member who is creating the value.” – Toyota Trainer to Charles Luttrell (from Toyota Culture: The Heart and Soul of the Toyota Way by Jeffrey Liker and Michael Hoseus)
One of the basic requirements for establishing an effective annual plan that many companies seemingly miss is a clear and consistent organizational purpose across the company.  Without clarity around why the organization exists, people will determine what is important based on their own perspective rather than that of the company, as a whole.  When this happens, it can lead to overloading people to the point where teamwork and performance is negatively affected.
Confusion around the purpose is what drives teams to create initiatives that may seem important to them but do nothing to help the company achieve its purpose.  The supply chain team implementing a new system for requisitioning material, the finance department changing the way expense reports are submitted, or process engineering installing robots on the shop floor are all examples of initiatives that may appear important to the teams driving them but can be unhelpful and disruptive to the teams working to produce products or serve customers.
What Problem Are You Solving?
When you get down to it, there are two basic jobs within an organization.  You either serve customers or help others serve customers.  Serving customers generally includes making products or delivering a service to end users – i.e., those things that generate revenue for the company.  Those who do this add value directly whereas everyone else delivers indirect value by helping those who deliver value solve problems and serve customers better.
Solving problems does not necessarily entail spending time and money on the latest technology or trend in the field.  It does entail spending time at gemba with those who provide value to understand their problems and find ways to help solve them.  Although it may involve implementing the latest technology, in many cases it does not.  It’s all about understanding and gaining agreement that a new project will solve problems and make life easier for those who provide value.  
When the purpose is clear to everyone in the organization, people will understand their roles and focus everything they do on improving the value the company, as a whole, provides.  Just as a company cannot hope to sell a product that customers are not interested in buying, a support function cannot hope to add value by selling a new initiative that its internal customers do not want.

Sunday, August 9, 2015

I Already Do Lean

The first step is transformation of the individual.  This transformation is discontinuous.  It comes from understanding of the system of profound knowledge.  The individual, transformed, will perceive new meaning to his life, events, to numbers, to interactions between people.” – W. Edwards Deming
Facing resistance when introducing lean to an organization is common – and even expected.  Especially early in the effort, people will look at lean as a passing fad or not applicable to what they do.  A less common but just as destructive type of resistance put up by some people is that they already to lean.  Dealing with this excuse for opting out of the effort requires taking the time to understand whether it stems from fear of looking ignorant by needing to learn something new or if it is ego driven.
First of all, nobody “does” lean naturally.  Although some people have more of an inclination toward lean thinking than others, everybody needs some level of learning or coaching to develop it more deeply.  The conventional western approach to business over the last century runs so counter to lean that a deep level of reprogramming is necessary for most people.  The problem for those leading the transformation, though, is to convince those who already do lean that, although they may apply components of it to their work, the big gains from lean come when it is understood and applied as a system.
Telling these people that they don’t understand lean will only get them to dig in more deeply and further block the willingness or the ability to learn.  Helping people open up to learning about lean requires spending a significant amount of time with them to learn what they do and how they work, and using a questioning approach to get them to realize that lean encompasses far more than eliminating waste, and that they have much more to learn to realize its true benefits.  It can take a lot of time to do this but, in a way, it is like going to gemba for personal transformation because driving change cannot be done without connecting to those with whom you are working to change.
Clues to Form the Questions
Spending time with those who already do lean will provide clues as to where to begin formulating the questions and the approach to drive learning.  Some of the actions and practices to look at during the time you spend with the person include:
  • Developing others is viewed as a high priority and there is clear evidence that it is actually being done;
  • People on the team the person leads have a clear line-of-sight to the company’s vision;
  • Interaction with team members is heavily oriented toward questioning to drive learning rather than advocacy and dictating orders;
  • Problems are addressed using a structured approach rather than jumping to the answer;
  • Decisions and actions are approached through the use of the Plan-Do-Study-Act (PDSA) cycle;
  • People are comfortable openly reporting and discussing problems;
  • There is a true connection to gemba that aids in setting team objectives and driving the type of support provided;
  • The processes team members use to achieve results is emphasized just as much – or more – than the results themselves;
  • The leader follows the same approach to addressing management or system-level problems as team members do for process problems;
  • Team performance is increasingly more dependent on the system than the skills or personality of the leader.
There are obviously other areas one could look to for clues for driving the conversations with someone who already thinks they know lean, but the above are a good place to start.  The key for the person driving the change is to go to gemba with the people being coached to learn what they do, how they do it, and the type of results they are achieving.  The more information you have, the better you can direct your coaching and conversations toward getting the person to slowly lower his or her defenses and open up to learning.
Transformation Can Happen
It is very satisfying to see someone have a light bulb moment with respect to lean.  It is at this point when transformation begins and learning greatly accelerates.  Although some people will never open themselves up enough to truly learn, I have found that, as long as I’m willing to take the time needed and continue to learn and develop myself, I can achieve some level of progress with most people.