Check out this tweet by Michael Ballé!
This is a damn good definition of Lean: “satisfying customers by developing people”. Great improvement from old-time definitions about “improving processes”, “eliminating waste” or the horrifying “cutting costs by firing people” (well, this has never been a serious definition, but sadly many people interpreted lean methods like that).
Please, don’t take me wrong: improving your processes and eliminating waste (mercilessly) are great things to do, but they are means, not a goal. Cutting costs is fantastic too, but it must be more the result of your efforts to create value and satisfy your customers than a goal by itself. And firing people, well… Developing people so that they can satisfy your customers is the only recipe to long-term success, which is the ultimate goal of any company.
Last Monday I attended a webinar about “aligning goals to vision” by Michael Ballé and the Lean Leadership Institute. It was the last of four webinars based on Michael’s book “Lead with respect”. You can find a summary with my notes here:
- Lean approach to vision can be described as “deliver quickly several times a day what people want“. The challenge in some cases is defining the customer (“people”) and value (“what people want”), especially in those businesses where lean has not been used very often.
- Lean is unique defining customer needs because the needs are defined one by one. Lean abolishes generic customers: customers don’t have to fit my process anymore.
- Companies have human capital (knowledge) and social capital (trust), both are critical for the company success. Social capital, hard to build, easy to lose.
- Keep this always in mind when implementing lean:
- Some work will not solve problems, it will help the corporation understand where problems are. Challenges are better understood by the corporation and therefore problem solving will be effective. This is critical.
- Don’t standardize visuals. Let people create their own panels and change and adapt them as many times as needed. Be dynamic. Sometimes visuals are forced to be similar across the organization (trying to honor the Lean principle of standardization) but this is an error.
- Lean financial impact analysis:ROCE = margin x turns
- ROCE: return of capital
- Margin: improves with Jidoka (first time quality that reduces waste)
- Turns: improves with JIT (just in time that reduces Lead time and increases responsiveness to the customer)
- The Lean dynamics:
- Customer lifestyle: take care of customer’s problems at a reasonable cost.
- Value analysis: improve quality by solving quality issues right away.
- Value engineering: learn about customer preferences to figure out new features for your product or service.
- Final summary: organize the company for learning (choose leaders for their ability to lead teams, teach and learn), not just for output (choose leaders for their ability to hit the numbers).
If you are interested in the webinars, they are available here:
I also recommend the book: