Anthony Bennett draws on his experiences of lean implementations in the defence sector and public service to illustrate how lean can go badly wrong when the focus is flawed and respect for people is forgotten.
In both the private and public sector, recession has created a renewed drive to reduce costs through headcount reductions and other ‘efficiency’ savings. ‘Lean will solve that’, consultants will tell you.
‘We are going lean’, reflect state managing directors, expecting a quick return for the bottom line. ‘Oh great’, say the workforce, wondering which priority of the latest ‘top priorities’ this one falls into! But is Lean the answer and, by implementing it for such short term gains, what damage is caused? I would argue that lean has to be considered for the long term improvement strategy and needs to be separated from the negative implications of economies and head count efficiencies if it is to gain traction or achieve results.
Lean = mean?
In 2006, a major public sector organisation required to immediately reduce costs and, with limited options available to the organisation, difficult decisions had to be taken. With the assistance of external consultants it was decided to utilise ‘lean thinking’ in order to reorganise and find the savings required.
Board Members were handed the headcount reductions they had to find within their own departments and, with the assistance of the consultants, workshops were organised to teach the five principles of lean thinking along with the eight wastes: transport; inventory; movement; people elements; waiting; over production; over specification; and defects. The ‘success’ of these workshops was based on the application of these ideas to the targeted headcount reduction.
During the average workshop, process maps were established and green dots were used on Post-It notes for ‘value add’ activity, red dots for ‘non-value add’ activity. But with the focus of the workshops being to find and implement the required headcount reduction, employees in the workshop were soon dismayed to see their own activities being covered with red dots, their outputs being ‘non value add’ by consultants.
To those individuals, lean was mean and threatening. In the first year of these workshops the headcount reductions were identified and while most were absorbed with no ‘real’ jobs lost, the experience of lean among the workforce left some devastated. Their engagement with ‘improvement’ was tainted and their willingness to engage in future improvement disappeared.
Womack and Jones in their excellent book Lean Thinking warn of the dangers of this approach. They advocate that successful lean implementation is a five year strategy, so lean is for the long term. They also state that they would not involve themselves in organisations using lean for purely job cuts and that promises should be made to employees that jobs would not be lost through lean implementation.
However, the latest government spending reviews have given clear warnings that real jobs will be lost as the public sector leans-up and it is expected that manufacturing and other private sector companies will recover such job losses in order to achieve growth and avoid massive increases in unemployment. But how does this ambition for growth sit with an industry strategy of ‘doing more with less’ and the necessary downsizing for a smaller but higher skilled workforce? This is where a realistic approach has to be taken. Ideally where waste in the process has been removed, the additional capacity can and should then be utilised for further value creation and the business can explore new opportunities to grow.
When this approach is adopted, employees will be far more willing to participate in lean workshops, find the waste themselves and then focus on flow and finding value for the customer.
At times roles do have to be amalgamated and jobs lost. This makes any promises of ‘no job losses from lean’ hard to keep. The important principle to adhere to in this, and all areas of lean, is the preservation of trust. If trust is eroded, your chances of achieving long term gains will also diminish. This is why the benefits of creating a ‘real lean’ culture cannot be underestimated.
Respect for People
Many of the respected commentators on lean advocate respect for people as being the central tenet behind ‘real lean’. Clearly this was not demonstrated in the lean implementation described above. Of course there is a place for tools and techniques, the unemotional and analytical side of the lean methodology, but on their own, they will not bring your workforce with you.
Respected employees, with a deep and extensive knowledge of their work should be fully involved in designing any improvement to their departments.
For those embarking on their lean journey this can, at times, be difficult to accept but a successful leader must both accept this for themselves and encourage others to understand what it means for their day to day roles. Give them the requirement for improvement (the what), explain the need for change (the why) and take on whatever discussions necessary to ensure that both elements are understood. Crucially, however, the ‘how’ should be left to the workforce to devise.
This was a steep learning curve for managers in the early stages of the particular public sector lean programme I have described. To start with, proposals were offered by employees in workshops for the redesign of organisational structures and outputs were amalgamated with those from other sections only ideas to be rejected as unacceptable to management! Sometimes whole days had been assigned for these so called improvement workshops but ‘political sensitivities’ and ‘lines not to be crossed’ had not been exposed to the workers at the start. The how of improvement will only be uncovered if respected workers are given known parameters by the leaders at the start.
Three years on
After the first year of the lean programme discussed here and the headcount reductions had been identified, a new approach was taken using a team of internal consultants from the workforce. Trying to recover from the first experiences of employees was extremely difficult but, with a renewed purpose of ‘continuous improvement’ with no threat of job losses, momentum for improvement workshops developed.
By giving clarity to the ‘what’ and ‘why’ explanations at the beginning and, leaving the ‘how’ to the employees, bottom up ideas were allowed to develop and, importantly gain the required buy-in for change.
This was a complete step change in approach and the wider benefits of the lean implementation could then be developed with a more involved workforce.
In this article, I have given a flavour of how some aspects of one organisation’s lean journey were undertaken in order to define how lean can be approached wrongly and help others avoid making the same mistakes. There is no doubt that the approach taken in the above implementation was destructive, undermining teams and doing nothing to encourage improvement. Today there are still senior managers, who, because of this experience in the early stages of transformation, now resent the term lean. They experienced lean as mean and it took a long time for some to see the benefits that continuous improvement could bring. Although lean leaders in sectors where the approach has been longer established than in public sector, such as manufacturing, may feel that their maturity of lean understanding would avoid the kind of insensitive waste focus I have described, current economic and efficiency pressures in all businesses mean it can be easy to become complacent about the focus of lean programmes. By focusing on value as seen by the customer and, continually improving our processes, through the full utilisation of people, real lean culture can be realised by both employees and the business.