OpEx/Lean, Innovation and Wakefulness

Pascal Dennis, co-author of Harnessing Digital Disruption

We spend our lives asleep. George Gurdjieff

OpEx/Lean is at heart is about wakefulness. Sages throughout history have argued that we are sleepers in a dream, and that our grasp of what's actually happening is, at best, tenuous. Many schools of philosophy and religion include prayer, meditation, or exercises, designed to "wake" the sleeper. Stoicism remains relevant today not in the least because it emphasizes regular reflection aimed at virtue and self improvement.

I’ve practiced regular reflection for decades now using the PDCA cycle, which surely Epictetus & other Stoic masters would find simpatico. OpEx/Lean methods like visual management, 5S and standardized work are all meant to jolt us out of our slumber. Defect-proofing usually entails a visual tool that loudly signals the abnormality – Wake up! - allowing us to contain it before it becomes a defect.

Strategy Deployment, essentially the application of PDCA to our enterprise, is also about wakefulness. Our Control Tower and operating rhythms, for example, entail stand-up meetings in front of visuals that make ‘hot spots’ obvious. All my business novels, include the latest, Harnessing Digital Disruption, entail the protagonists' gradual awakening.

Pema Chodron, the American nun and Buddhist teacher challenges us to see what’s there. Her practice entails disciplined meditation – sitting still, recognizing the many attachments that distract our minds from what’s there. And lest we forget, Socrates famously advocated ‘know thyself’, believing this to be essential for a good & virtuous life.

Innovation is also about wakefulness, and seeing what the customer actually values – even though they may not see it themselves! (Steve Jobs famously said, ‘The customer doesn’t know what they want, until I show it to them.’) And then envisioning & designing an entire customer journey – one that will blow the customer’s mind. This was surely another of Jobs’ superpowers. Did Jobs’ interest in mysticism and meditation, combined with his artistic temperament not enable his creativity?

Best regards,

Pascal Dennis

E: pascal.dennis@leansystems.org

PS: To learn more about my executive mentoring programs: Exec 101 - Protecting the Core Business, and Exec 201 – Igniting New Growth, feel free to drop me an e-mail.




In case you missed our last few blogs... please feel free to have another look….

The Difference Between Protecting Your Core Business & Igniting New Growth
The Control Tower – Learning to See What Is
The Hardest Thing - Seeing What Is
Fundamentals of OpEx/Lean, Part 2

The Difference Between Protecting Your Core Business & Igniting New Growth

Pascal Dennis, co-author of Harnessing Digital Disruption

The future belongs to the ambidextrous – those who can both protect the core business with OpEx/Lean AND ignite new growth using the magic of Silicon Valley & Singapore. Our biggest challenge is understanding the very different mindset behind OpEx/Lean & Innovation. Our biggest challenge: OpEx/Lean and Innovation live in very different worlds first articulated by Aristotle 2,500 years ago.

OpEx/Lean Lives in the World of Necessity

This is the world of things that cannot be other than they are. Think Physics, Chemistry and Math; think PDCA, process management, and the Theory of Constraints. The Pareto principle – 80% of the problem is caused by 20% of the causes – is a cornerstone of this world. I absorbed this iron principle as a young Toyota manager. Up until then, like all young managers, I was prone to ‘blah blah blah’. Today I’m lucky enough to advise Boards & C-suites and guess what? The Pareto principle remains fundamental in Board decision-making.

Innovation Lives in the World of Contingency

This is the world of things than can be other than they are. Think fashion, taste, public opinion and culture. Igniting new Growth entails answering questions like:

• Who is the customer?
• What does the customer value?
• Why do they buy, or not buy, from us?

After a few Innovation sprints I realized I was ‘no longer in Kansas’. The principles of OpEx/Lean I’d worked so hard to internalize could be helpful, but were not sufficient, by a long shot! Sometimes they applied – and sometimes not! For example, customers would confidently tell us what they valued – and then ignore it when presented with our offering. And then they’d change their mind again.

Standards & analysis were helpful, for example, in the clever crafting of Discovery interview scripts (‘What hypothesis are we testing?’), and astute qualitative & quantitative analysis. But intuition and gut feel played a far bigger role than in the world of Necessity.

Pareto charts often went out the door. We would identify what we believed were the key Satisfiers and build a kick-ass offering. And then realize our approach was a dead-end because our competitors had done exactly the same as we had done.

Igniting new Growth means finding the proverbial ‘Blue Ocean’ – the place where nobody else if fishing. My Innovation mentor & co-author, Laurent Simon, taught me the magic of Discovery & Validation Interviews through which, with practice, I learned to uncover the hidden pains & needs that might truly delight the customer. These are often so obscure that not even the customer knows them!

For example, one of our projects entailed creating value in the Wealth Management division of a major bank in east Asia. Our Discovery & Validation interviews uncovered a profound, yet unspoken need of customers – anxiety about their elderly parents. We turned it into a kick-ass offering that opened up our ‘Blue Ocean’.

And this is why ambidexterity is such a challenge: Board & C-suite members have to recognize Aristotle’s two worlds and apply the methods & mental models that suit the situation. It took me a decade to understand how to protect the core business with OpEx/Lean. It has taken me another decade to understand the topsy-turvy world of Contingency and Innovation.

It’s worth it for the organization and the individual. In the age of AI, leadership, flexibility and creativity will be the key to sustained prosperity. Understanding how to navigate the worlds of Necessity and Contingency, and how to engage a high performing team (of both human & AI agents) will be a superpower.

Best wishes,

Pascal Dennis

E: pascal.dennis@leansystems.org




In case you missed our last few blogs... please feel free to have another look….

The Control Tower – Learning to See What Is
The Hardest Thing - Seeing What Is
Fundamentals of OpEx/Lean, Part 2
Fundamentals of OpEx/Lean, Part 1

The Control Tower – Learning to See What Is

Pascal Dennis, co-author of Harnessing Digital Disruption

See what is - Pema Chodron

Last time I talked about the cognitive biases that afflict human beings and hinder our ability to see. I used the Electromagnetic spectrum as a metaphor, explaining that we only see a tiny portion of what’s there. I suggested visual management, humility, diversity and going to see for yourself as possible countermeasures to our inherent near-sightedness.

How do you build all this into your management systems & daily routines? I’d like to talk about perhaps the most useful management system: the Control Tower (aka Big Room, Cockpit or ‘Obeya’). This is a large room in analogue and/or digital space that expresses ‘What is Actually Happening’ (WAH) and ‘What Should Be Happening’ WSBH with simple, clear visual systems. Typically, the Control Tower has three ‘walls’:

• What’s our Aspiration & Winning Logic?
• What is happening right now versus what should be happening?
• What are our biggest blockers & what are we doing about them?

In earlier articles I described the four levels of visual management. We need to apply these ideas to tell compelling stories for our key audiences. Typically, our audiences include:

• Our team
• Those who report to us
• Other teams whose support we need, and sometimes
• The Board

Each audience has specific questions it wants answered.

We need to define our Rules of Engagement in advance, and senior leaders are responsible for setting the tone. Here are a few sample rules:

• Talk less - seek to listen and understand.
• Leave your rank at the door
• No HiPPOs or ZEBRAs¹
• Data trumps ‘blah blah blah’
• Encourage broad engagement. Ideally, everybody should speak (with brevity & focus)

We also need to define our Control Tower’s ‘Operating Rhythm’ comprising the Purpose, Process, Expected Outcome, Inputs & Timing. Each session should have a meeting owner and a meeting observer who provides objective feedback: (‘How well did we follow our Rules of Engagement and Operating Rhythm?’)

The Control Tower is a form of theater that reflects our values, standards and culture. We’re telling a true & meaningful story to audiences that are deeply invested and whose help we need to succeed. We’re also expressing who we are, and what we believe in.

As in any good drama, leave the boring parts out. Keep report outs short & focused. ‘Target, actual, please explain’ is an excellent mantra, reinforcing the virtue of simplicity and clarity. ‘Blah, blah, blah’ usually means we don’t know what we’re talking about.

Senior leaders must set the tone by reinforcing standards of behavior. One of my formative experiences was an inept presentation to senior leaders I deeply admired. The President looked at me and simply said, ‘Please do not come here unprepared again, Pascal-san.’

The ensuing silence was painful, but I got the message: Why are you wasting everybody’s time? You know our standards. We expect much more from you. I resolved to do everything within my power to improve. That’s the power of the Control Tower, standards, and strong, ethical leadership.


^{1. Highest Paid Person’s Opinion; Zero Expertise But Really Arrogant↩}

Best wishes,

Pascal Dennis

E: pascal.dennis@leansystems.org




In case you missed our last few blogs... please feel free to have another look….

The Hardest Thing - Seeing What Is
Fundamentals of OpEx/Lean, Part 2
Fundamentals of OpEx/Lean, Part 1
Canada's Innovation Makeover: Singapore’s Cheat Sheet

The Hardest Thing - Seeing What Is

Pascal Dennis, co-author of Harnessing Digital Disruption

See what is - Pema Chodron

I’ve spent the past few decades working with Boards & C-suites around the world - smart, successful people, and for the most part dedicated to the common good. I’ve tried to help people understand a) how to protect the core business using the powerful methods of OpEx/Lean, and b) how to ignite new growth using the methods of Silicon Valley & Singapore. Such ‘ambidexterity’ is the essential to sustained prosperity.

What’s the biggest challenge? How to see what is actually happening (WAH)? Way back when I was a fledgling Toyota manager & engineer, WAH was a central theme. Our splendid mentors (senseis) drew circles on the shop floor and asked us to stand there, observing a process closely. After an hour or so, they’d ask, ‘What do you see?’

With practice, I learned to see waste, variation and strain (Muda, Muri and Mura, the ‘3M’s’). Then our senseis would ask what should be happening (WSBH)? which opened up the worlds of flow, ergonomics and process management. I learned an invaluable lesson: If you can define WAH and WSBH you have a good understanding of the problem. You can start think about countermeasures to bridge the gap. In strategy, we call this the ‘winning logic’, which informs all our activities. But it all begins with Pema Chodron’s simple request, quoted above.

Why is it so hard to see what is? Sages throughout history have pondered this question. A few years back, in INSEAD’s splendid Corporate Governance program, we learned about the hidden biases (blind spots) that can afflict Boards. These include the Anchoring, Sunk Cost, Status Quo & other traps that can lead to decision-making disasters. Daniel Kahneman and Amos Tversky helped to explain our blind spots in their classic book Thinking, Fast & Slow. Dan Ariely’s Predictably Irrational is another fine resource.

What to do? Visual management is perhaps our greatest enabler. The ingenuity of the front line in making WAH visible is inexhaustible, and a reason why ‘Total Involvement’ is a cornerstone of OpEx/Lean.

A second enabler is humility - accepting that we are fallible creatures whose grasp on reality is imperfect. A third enabler is diversity of training & experience - the broader a team’s composition, the deeper is our grasp of WAH. A fourth enabler is going to see for yourself. Do not trust the report, chart, voice or video message. Go see it, sense it, hear it, touch it…Things are almost always different than you expected.

My core metaphor here is the Electromagnetic Spectrum, which encompasses radio waves, microwaves, infrared radiation, visible light, ultraviolet radiation, X-rays, and gamma rays. Visible Light (i.e. visible to humans) is but a narrow part of the spectrum (~ 400 to 700 nanometers). In other words, we only see a small fraction of what’s there.

How do you build all this into your management systems & daily routines? Stay tuned.

Best wishess,

Pascal Dennis

E: pascal.dennis@leansystems.org

PS: To learn more about my executive mentoring programs: Exec 101 - Protecting the Core Business, and Exec 201 – Igniting New Growth, feel free to drop me an e-mail.



In case you missed our last few blogs... please feel free to have another look….

Fundamentals of OpEx/Lean, Part 2
Fundamentals of OpEx/Lean, Part 1
Canada's Innovation Makeover: Singapore’s Cheat Sheet
The Two-Gear Economy, part 2 - Singapore’s Innovation Ecosystem