Sunday, March 22, 2015

Using Lessons Learned to Drive Improvement

It is fairly common for companies to hold a lessons learned session after a major project or an incident to understand the things that did not go well and could be done better next time.  Unfortunately many of these types of sessions I have seen over the years do not really accomplish much in the way of sustainable improvement for the company.
Learning is not necessarily an easy thing for individuals, much less teams and organizations, and it often takes a cultural shift to create the type of environment where deep learning takes place and truly sustainable change occurs.
THE ELEMENTS OF LEARNING
There are several elements that need to exist for a team to learn from past events and use the learning to drive improvement.  In no particular order, these elements consist of the following:
  • Process for Learning: People on the team need to understand how to learn, in particular the PLAN-DO-STUDY-ACT (PDSA) cycle.  The PDSA cycle is based on the concept that learning is driven by continual stating and testing of hypotheses.  If a project experienced problems, for example, the team needs to consciously understand what it expected to happen, including the processes, systems, etc. that were supposed to drive the expected results.  In the end, it is these things that need to be adjusted to change the result next time.
    Sustainable change is not driven by the memory of an individual or the team in place at the time.  People move on and teams change, and if the processes and systems used for the next project are not adjusted to apply the learning, results will very likely not change.
  • Appreciation for Standardization: The organization needs to understand and believe in the benefits of standardized work.  If individuals are allowed to stray from standards – something that is much more common than people like to admit – there is nothing to assure that changes made will be followed in the future.  Standardization also provides an anchor for learning because it describes the process that is expected to be followed and drive results that meet expectations.  A standard that cannot be followed or results that do not meet expectations identifies a problem that, through the PDSA cycle, will drive learning and improvement.
  • Confidence to Learn: In many organizations, learning from others can be seen as a weakness.  Especially in organizations where internal competition is strong, learning from a peer can affect a person’s career progression.  This feeling can drive people to discard improvements made in other areas of the company to the point where learning is completely stifled.
  • Effective Problem-Solving: Improvements made in one area are often expected to be immediately adopted in one or more other areas that perform similar work.  Implementing a change without clearly understanding the problem being addressed can negatively affect performance.  People should actually be discouraged from applying an improvement from another area without first doing some level of problem-solving to assure that the change benefits performance.
I’ve attended many lessons learned sessions that, although the people involved did an excellent job of understanding the problems experienced with past events, resulted in little change.  Understanding and addressing the above elements can greatly improve the benefits associated with these efforts and drive a culture of learning and continual improvements.

Sunday, March 15, 2015

The Price of Fear

"Drive out fear so that everyone may work effectively for the company." - W. Edwards Deming

What does fear cost businesses each year?  Thousands? Millions? Billions?  It’s something that obviously can't be measured accurately, but when I think about some of the organizations I have worked with in the past, I'm guessing the figure is extremely high.

Although the type and extent of fear differs for every organization, it affects virtually all companies in one way or another.  Since much of the cost related to fear is indirect and difficult to measure, though, most companies don't think about it or put forth the effort to reduce its existence.

The Effects

Okay, fear is not necessarily a bad thing for the human race.  It is an emotion designed to lead us to take action when we sense danger.  As a fundamental instinct, fear is a short-term behavior that motivates us to avoid or escape from dangerous situations.  In this sense, fear can lead to bursts of energy and creativity to assure safety and survival.

Within the workplace, however, fear tends to be a chronic condition that wears people down over time.  Although chronic fear affects different people in different ways, most psychologists agree that it is destructive.  Any positive effects on motivation and action are short-term.

The fears that commonly exist within organizations include fear of layoffs, disagreeing with decisions and opinions, asking questions, and taking risks.  In business, the areas that are negatively affected by these fears include the following:

  • Creativity & Innovation: When people are stressed, the conscious mind blocks creativity and innovation.  Fear prevents people from relaxing to the point where they can access the right brain and develop creative solutions to problems;
  • Goals & Objectives:  People will avoid committing to stretch goals and objectives when they feel there will be repercussions if the goals are not met.  Fear also leads people to do whatever is necessary to meet a goal, whether or not it actually helps the organization meet its objectives;
  • Customer Focus: A culture of fear and blame causes people to focus on meeting the needs of their boss rather than the customer;
  • Learning: Effective learning requires the freedom to study the facts and test ideas in real situations.  Some ideas will fail, which is okay because of the learning that results.  Fear of failure blocks people from taking the time to clearly understand problems and test ideas;
  • Health Issues: There have been numerous studies on the negative effects of stress and fear on personal health.  Chronic stress suppresses the immune system, leading to an increase in colds and flu, in addition to a host of potentially more serious conditions.  At best, fear can drain energy and lead to indifference and mediocrity.
Taking Action

So what should business leaders do to address the problem of fear?  I have talked with senior leaders in the past who don’t see fear as a big problem because they don’t see it.  Company leaders unfortunately don’t commonly have the perspective to accurately judge the level of fear within the organization.

Since fear can greatly impede transformation, however, organizations pursuing lean thinking need to understand the level of fear that exists and begin to address it immediately.  I’ve seen this done with focus groups and surveys, but the most effective method is to increase visits to gemba.  Although go-and-see visits to the workplace can initially increase the level of fear and suspicion among team members when done well, the level of trust that results can significantly improve the situation.


Developing plans from the highest levels of the organization to reduce fear greatly improves the chances of success with lean.  Developing an army of problem-solvers throughout the organization requires that people feel comfortable enough to work toward what’s best for the company and its customers rather than what they think is important to the boss.  As the situation improves, the release of human potential to improve the organization can be staggering.

Sunday, March 8, 2015

Beware the Next Management Fad

It does not happen all at once.  There is no instant pudding.” – W. Edwards Deming
I recently read an article in the February issue of Fortune magazine entitled, The Algorithmic CEO that starts out with, “Get ready for the most sweeping business change since the Industrial Revolution.” The article goes on to tout mathematical algorithms as the most important instrument of change in business today, and credits the success of companies like Google, Amazon, and Apple to mathematics.
I am not arguing with the importance of math to the success of business, but as I read the article, I couldn’t stop thinking “here we go again.”  Another fad representing itself as the one piece of the puzzle that will lead us to the promise land.
We are constantly looking for the quick answer to success and can’t – or don’t – want to understand that it is the result of learning, improving, and pretty much doing a lot of things well.  There is no quick answer to make it happen – it requires hard work and requires a lot of focus, humility, a method to continually improve, and a whole lot of patience.
Management Fads
The article made me remember all the management fads I’ve run into during my career, and how they did little more than distract organizations and make a lot of money for consultants and authors.  It also reminded me of the words of W. Edwards Deming and how we will jump on anything that promises a quick fix to business problems.
As I thought about the numerous management fads through the ages, a few stood out as particularly annoying.
  • Six Sigma (yes, six sigma): I had to put this one first because it’s the most recent distraction from working on true improvement.  In a 2013 article in Inc. magazine, Geoffrey James wrote that six sigma results in, “a hierarchy of ‘belted’ experts who run around the company pretending that they know how to do other people's work better than the people who actually do the work. Endless meetings ensue, with little or no effect,” and I can’t agree more.  A 2007 Bloomberg article on the problems Home Depot was experiencing at the time wrote that store workers complained that the constant data measurement “sapped time given to customers.”  Those who have read my posts in the past already know my thoughts on six sigma, so I’ll stop here.
  • Business Process Reengineering (BPR): BPR consists of a “blank sheet” approach to designing an organizations critical processes. At the time, it was touted as a way to achieve dramatic improvements in quality and productivity.  Besides the obvious problems of starting from scratch rather than understanding the existing process - including the current problems it’s experiencing - and changing it one element at-a-time to enable it to continue to operate and assure it’s actually improving, BPR somehow turned into a vehicle for layoffs.  I remember people telling me at the time that they were “engineered out of a job.” 
  • Management by Objectives (MBO): I don’t have a problem with the philosophy of MBO as Peter Drucker created it.  Determining the organization’s high-level objectives and aligning the objectives of teams and individuals to achieve them sounds logical, and a whole lot like policy deployment.  Once the business world got ahold of it, however, it morphed into something destructive.  Objectives were often disconnected –almost random – and resulted in destroying teamwork by putting people to work on meeting personal objectives whether or not they actually helped the organization as a whole.  Drucker wrote that MBO requires a lot of effort to clarify and align objectives, but many who used it decided to shortcut the process, making it highly ineffective.
  • MRP, MRP II, ERP, etc.: I remember reading a report from the 1980s by a team of American manufacturing experts who traveled to Japan to study Japanese production techniques. The report touted the work of quality circles and focus on continually improving processes throughout the plants.  One of the conclusions of the study, however, was related to that Japanese automakers would be even more successful if they replaced their kanban systems with MRP.  Companies were certified for applying MRP (offered, by the way, by a company that provided MRP consulting services), and built staffs to manage the system as inventories grew, costs rose, and on-time delivery of products fell.
I know that the author of the Fortune article is just trying to get the attention of business leaders by comparing math algorithms to the Industrial Revolution, but it’s frustrating to think we could be facing another distraction to instituting strong leadership in organizations.  To credit the success of companies like Apple and Amazon to their use of math is a stretch.  These companies have strong and focused leadership that is on providing products and services that continually make life easier for their customers and team members.  Although they use math as a tool to help the business, it is but one part of the equation that won’t work without engaged leaders who understand and improve their ability to manage the overall system.

Monday, March 2, 2015

Want Lean to Succeed? Stop Focusing on Waste!

Although one of the most significant benefits of lean is the reduction of waste, it is not enough to say that lean is about reducing waste.  This may sound confusing, but those organizations that focus too heavily on waste as they go into lean tend to be the ones that become disappointed with the effort and end up dropping it altogether. 
Avoiding Tool Infatuation
Thinking that lean is all about reducing waste often leads to an infatuation with the tools and completely misses the idea that, without transformation, the tools will do little to drive sustained improvements.  Lean is about transforming leadership, planning, learning, and thinking.  Reductions in waste will happen, but they will be impossible to sustain without transformation.
Our obsession with quick results has somehow led to the mistaken idea that lean is a toolbox for waste reduction.  We call in a lean “expert” who knows which tool to apply to a particular problem, and expect it to be solved while we go about business as usual.  The problem may even appear to be solved – but it eventually creeps back into the process without warning – often much larger than before.  In the end, we conclude that lean doesn’t work and abandon it altogether.
So What is Transformation?
Just saying that lean is about transformation isn’t enough to make it happen.  People need to know what transformation is, what their roles will be in the effort, and what they can realistically expect as a result.  A big part of the effort will be to assure leaders stay engaged and make a sincere effort to learn a different way to lead.
Although there is no magic formula for deploying lean within an organization, there are some basic elements of transformation that need to be included in the effort.  These elements include the following:
  • Clear Vision: The organization needs to have a clear and common vision of the future.  The vision pulls people and teams together and aligns efforts toward common objectives.  Without a vision, improvement efforts will become disjointed and random, resulting in little or no sustainable success.
  • Team Learning: Long-term sustainable improvement requires a method to assure continual team learning.  The Plan-Do-Study-Act (PDSA) cycle is a method for learning that, when applied consistently, can lead to effective team learning.  Based on scientific method, the PDSA cycle reprograms the way people think and approach the work they do, and leads to the development of a true learning organization.
  • Focused Annual Planning: Making the vision a reality requires that the organization continually adjust its efforts based on a number of internal and external factors that affect performance. Instituting a clear and focused annual planning process helps maintain focus on the vision while assuring that yearly targets are achieved.  When approached effectively, the plan drives an effective balance between the daily work (the annual targets) and improvement efforts (the vision).
  • Line-of-Sight Between Work & Long-Term: The benefits of aligning the work people do with the long-term objectives of the organization are huge.  Strong and focused leadership, along with effective dashboards can help people understand how the work they do connects to long-term objectives.
  • Enlightened Leadership: Achieving any level of sustained improvement is not possible without a leadership team that is focused, aligned, and continually learning how to become better leaders.  The role of leaders shifts dramatically toward being a coach with the objective of developing the problem-solving skills of team members and creating future leaders.
These elements comprise a system of improvement and, as with any system, requires development of the whole to be effective.  Although there are times where you may put more effort in one of the elements than the others, ignoring any one will result in a breakdown of the system.  The key, however, is to understand how each is connected to the vision, and that they work together to make the vision a reality.
Waste will be significantly reduced as the organization is transformed, but it is the result of a constant and obsessive focus on achieving the vision.  Targeting waste at the outset misses the point by attempting to skip the learning that is absolutely necessary for sustainable improvement.

Sunday, February 22, 2015

The Science of Dashboards

One of the elements of lean that seems simple but is often misunderstood is the development and use of dashboards.  People are often surprised to learn that there is a science to creating an effective dashboard and that it consists of much more than posting metrics related to the area.
A dashboard should drive development of people and improvement in performance.  If these two things are not happening, then it needs to be changed.  Too often, I find that the metrics on dashboards are oriented toward providing information to management rather than providing the team with the type of feedback that helps drive improvements.  If the team does not find value in the dashboards, then it is waste.
ANATOMY OF A DASHBOARD
I approach the development of dashboards by initially questioning the team about the value it provides and the problems it encounters.  Clarifying the team’s purpose will help it zero in on the value it provides to the process and what it should measure to assure it is helping the organization achieve its objectives.  It also prevents the team from becoming too narrowly focused on one target while ignoring others that are just as important (e.g., a supply chain team focusing on the price of incoming materials rather than the total cost of the material, which includes the effects the material has on production).
One thing to keep in mind with the process is that it requires time to reflect and truly understand what is happening with the process.  Once the team purpose is clear, people can start to develop the metrics that will help drive the type of improvements needed to contribute to the organization’s success through the following steps:
  • Define lagging metric targets: Lagging metrics measure of the result of a process.  Defining the targets in terms of key areas like safety, quality, production, cost, etc. help measure what is ultimately important for the team.  The lagging metric connects the team’s work to the larger system and provides feedback regarding the success of improvement efforts;
  • Develop leading metrics: The leading metrics are the predictors of the lagging metrics in that they help to identify what is happening now that will eventually affect the lagging metrics. 
  • Identify activity-based leading metrics: Since some leading metrics are really lagging metrics, it is critical to work toward activity-based leading metrics, which measure what the team is actually doing to close the gaps in lagging metrics.  The activity metrics are, in effect, the team’s efforts to solve the problems that show up in higher-level lagging metrics.
The figure below presents a very simple example of a safety dashboard for a rotor assembly area of a factory.  The top of the dashboard provides information about the longer-term direction of the company.  Although this may seem obvious to some, it is important to always maintain the connection between the team’s efforts and the company’s vision.
Safety Dashboard Example 2
The next level of the dashboard provides what the company determined to be its ultimate measure of safety, followed by the rotor assembly team’s performance and focus for improvement.  In the example, the team determined that it needed to reduce hand injuries in order to improve its safety performance and further decided that it will conduct regular audits and provide ongoing training to team members on a variety of hand safety issues.
The benefit of this dashboard is that the team can use it to identify the gaps in safety performance and actually measure what it is doing to improve.  If safety is not improving, the team can look to the activity measure and figure out why, for example, audits are not being conducted according to plan.  Team members can take action to assure audits are conducted as planned to ultimately determine whether or not they are driving improvement as expected.
The development objective of the dashboard comes from the conversations around the dashboard.  How is the team performing?  What are you doing about the gaps? Why are you focusing on hand injuries? Etc.
The effort takes quite a bit of coaching and reflection by the team to truly understand the process and how to improve to achieve targets.  Once everyone understands that the customer of the team’s dashboard is the team, it becomes much easier to develop one that actually helps drive improvement. 

Monday, February 16, 2015

The Many Benefits of Standardized Work

Where there is no standard, there can be no kaizen.” – Taiichi Ohno

The above quote by Taiichi Ohno is used frequently to emphasize the importance of standardized work.  It’s one of those statements, though, that is so simple that I believe many people miss the true depth and significance of standardized work to an organization’s success.

Without a clear understanding of why standardized work is so important and how it drives improvement, it can be easy to miss out on many of the benefits that an effective system.

Among the benefits of integrating standardized work into the operation include:

Consistency/Stabilization  The chances of achieving stability in a process are very small without standardized work.  Clear and simple instructions help people do the work in a consistent way.  Without a standard, people are free to do the work as they see fit.

Identification of Problems  A standard defines how a process should operate every time.  Therefore, whenever the process does not follow the standard (e.g., defect, too much time, cost overrun, etc.), a problem has occurred that needs to be addressed.  Identifying a problem as a departure from standard – or expectations – makes it much more objective and easy for people to do.

Investigation of Problems When a problem occurs, the first place to look is the standard.  Did the people involved follow the standard?  If not, why not?  If so, then where did the standardized work breakdown?  How are we going to improve the standard to assure this problem will not recur?

Sustaining Improvements This is what most people think about when they read the Ohno quote.  There is no way to assure that team members will follow the improvements because there is no standard that people are expected to follow to perform the work.

Free Up Brainpower  Many people fear that standardized work attempts to turn them into robots but, in reality, the exact opposite is true.  One of the objectives of standardized work and associated training is to develop the ability to perform repetitive tasks subconsciously so brainpower can be free to focus on problem-solving.

Team Learning Incorporating improvements into standardized work assures that learning and associated improvements remain with the team rather than with individuals.  As people move in and out of the team, the improvements made over the years stays with the team.

I can only guess what Taiichi Ohno meant when he made the above statement.  The more I learn about lean, however, the more I understand the significance and depth of such a simple statement. 

Sunday, February 8, 2015

The Lean Coaching Script

No institution can possibly survive if it needs geniuses or supermen to manage it. It must be organized in such a way as to be able to get along under a leadership composed of average human beings.” – Peter Drucker
There is little argument that effective coaching is critical to drive lean thinking within an organization or a team.  Believing this and actually doing it, however, are two different things.  The ability to coach does not come naturally to most people, and without a standardized method for coaching, the variation in application can doom the effort to failure.
The Script - 4 Key Questions
Fortunately, there are four basic questions that leaders can apply in a variety of situations that, when done consistently, can drive the type of thinking that leads to improved performance throughout the organization.  The questions are based on teaching and reinforcing a standard way of looking at results to identify problems and make improvements.  The questions can be applied in a variety of situations to develop a lean mindset throughout the organization.  A further benefit of the questions is that they develop the ability of leaders to coach.  And this is all done real-time, using actual data from real processes.
The questions are as follows:
  1. What is your objective? This question helps clarify thinking about what exactly the process is expected to achieve.  It helps people understand the value they provide and how their process fits into the bigger picture.  Too often, teams go about their business without a clear or consistent idea of why they are doing what they do.  This question can help the coach guide the person being coached toward a systems thinking approach by assuring the team does not become too narrowly focused on one specific target at the expense of larger organizational objectives.  The discussion around objectives basically becomes a realtime catchball session as it helps clarify expectations and understanding.
  2. What is the data telling you? This helps the person develop an ability to use data to guide action.  Asking questions about data can lead to learning about lagging and leading indicators and how each fits into the improvement process. The discussion will naturally lead to questions about which metrics are being reported and why.
  3. What are you doing about the gaps? It is important to drive thinking around actions to understand and close gaps between targeted and actual performance.  Regularly questioning a person about gaps helps the person develop a natural inclination to look for problems on a continual basis.  The result is an almost obsessive desire to attack problems and close gaps.  Remember, though, that this is a conversation about improvement.  You are trying to develop the ability to show and address - not hide - problems, so the tone of the conversation, as well as a good deal of patience, is critical to success.
  4. What help do you need? Implied in coaching and development is the idea that it is a team effort.  Handing a problem to someone and walking off is not coaching – it is also not leadership.  You’ve got to be involved enough to guide the person through the process with the objective of helping him or her develop the ability to quickly and effectively address problems.  Especially early in the development, you need to understand what the person is thinking and why they are approaching an issue in a certain way.  The problem-solving A3 is perfect for this purpose because it helps the coach see into the mind of the person as they attempt to address a problem.  Remember that you are the coach, rather than the person working the problem, and that your objective is to help him or her develop the ability to address future problems without your help.
Developing successful coaches and leaders throughout the organization requires, at least initially, that everyone follows the script.  If people stray from the questions before they truly understand the process, the result will be variation in the way people identify and address problems, and unfortunately, very little development.
Another reason for sticking to the script is to develop the ability of leaders to question rather than tell.  If development was as easy as telling people what to do, organizations would run much better and transformation would be an easy process.