Has OpEx/Lean Gone Wrong?

Pascal Dennis, author of Getting the Right Things Done

This question comes up repeatedly, so I thought I’d try to address it in a fresh way. My OpEx/Lean adventure began in the early 1990’s. I was a young engineer and manager fully absorbed with the Toyota Production System (TPS). My colleagues and I believed strongly that if we could master this way of thinking & working, we’d have a superpower: we could create Value in any industry and role we found ourselves in. Peter Drucker, Taiichi Ohno, Shigeo Shingo, and our formidable Toyota senseis were our guides.

Fast forward to today, and OpEx/Lean has truly lived up to its promise. Companies like Toyota, Honeywell, Danaher, and P&G continue to set the bar for excellence, and the Toyota Production System remains the gold standard for industries like energy, healthcare, and manufacturing If you dedicate your career to mastering these methods, you’re in good shape.

However, there’s a catch. Has OpEx/Lean kept up with the world of innovation? Have we incorporated insights from innovation giants like Clayton Christensen, Steve Blank, and Alex Osterwalder? And most importantly, do we understand the different mindsets and skillsets needed to continually Innovate at high level? I’ve written about Aristotle’s two worlds: Necessity (OpEx/Lean) and Contingency (Innovation). The key challenge is to understand them both at a deep level and figuring out how to switch between them seamlessly.

About a decade ago, I became absorbed by Innovation hot spots like Silicon Valley and Singapore. I began to study the achievements of Steve Jobs and Bill Gates, and the teaching of Clayton Christenson, Steve Blank, and Alex Osterwalder. I found an innovation sensei, my friend & co-author, Laurent Simon. Laurent & I developed a practice and wrote a book about our Innovation adventures in east Asia (here’s the book). My Innovation journey has been as rich & challenging as my TPS journey.

Pascal & Laurent – Innovation Sprint in Thailand during the Kratong Festival
© 2025 Lean Pathways Inc.

My eureka moment when Laurent and I started working together on innovation projects in the Asian plant-based drink industry. Our goal was to develop & launch a new product from scratch. Our inspiration and model was a French product that should have been a commodity but instead commanded a premium price (20%+) - even in countries that did not like the French!

We too, wanted to find our ‘blue ocean’ – engaged customers who loved our offering & were happy to pay a premium for the value they received. And we wanted to launch in half the time, and at half the cost. The innovation team succeeded; we met our targets, learned a ton, and had great fun. Moreover, the methods & mindset we applied have become the New Product Launch process standard.

Post-launch, the COO, a friend & supporter, said, “Every year, we work like crazy to reduce waste, and thereby boost profit by a few percent. You’ve just shown us how to boost profit by twenty percent…”

And this is perhaps why senior leaders see OpEx/Lean as necessary, but not sufficient. OpEx/Lean lays a solid foundation and reliably delivers waste reduction year upon year. But that’s not enough. We also need to ignite new Growth using the methods & mindsets of Silicon Valley and Singapore. We want to find our blue ocean, and the dedicated, engaged customers who happily pay a premium in return for offerings that delight them. Experimenting your way up the ‘hockey stick’ curve in pursuit of an elusive blue ocean is as exhilarating as launching a major new car model. The challenge for 21st C leaders is being able to lead both.

In summary, OpEx/Lean has not gone wrong, but OpEx/Lean leaders must embrace the methods & mindsets of Innovation. We must look outside the relatively predictable world of Operations, and into the volatile, uncertain, complex and ambiguous world of the customer.

Best wishes,

Pascal Dennis

E: pascal.dennis@leansystems.org

PS To learn more about my Strategy Execution program, Getting the Right Things Done in a Digital World, feel free to drop me a line.




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

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Igniting New Growth – Aristotle’s Two Worlds, Part 2
Igniting New Growth – Aristotle’s Two Worlds
Innovation Does Not Begin with Technology

All Systems Must Support Humanity – Including Lean

By Pascal Dennis (bio)

The Toyota Production System (TPA, aka ‘Lean’) is perhaps the world’s most powerful management system.

Many people (including the Lean Pathways team & I) have dedicated themselves to learning & practicing its methods & mindsets, and to unlocking its mysteries.

Practiced diligently TPS provides a bountiful harvest. Like all great systems, TPS can be all-encompassing. It can absorb practitioners to such an extent that we can lose sight of the most important things.

Such as why are we practising TPS/Lean? What’s our Purpose?

Strong companies & people define Purpose clearly & simply. They understand that Purpose (often called True North) must be simple, visual and compelling. Something for the head & something for the heart.

And therein lies the challenge. It’s easy to forget about the heart. The Lean system, the methodologies & their interplay, is so engrossing that it absorb all our attention.

All systems, including Lean, must support our humanity – not vice versa!

Sadly, we all know organizations that lose sight of this fundamental idea. There’s a hollowness to them, an emptiness that ultimately limits their achievement.

The history of the 20th century teaches us that supposedly “idealistic” systems can even turn monstrous when disconnected from humanity.

So what’s this mean for the practicing manager and leader? Practice what I call the “Warm Heart Principle”: Easy on the people, hard on the process.

It’s not all about efficiency. It’s about effectiveness, achieving both our head & heart goals.

Don’t want to be misunderstood. I am not saying it’s okay to relax standards. Leaders have to be crispy at times, and being so is not necessarily inhumane. (Quite the opposite, in fact.)

I am saying, keep your heart goal close. Let it inform the management system you are building.

All systems must support humanity.

Best regards,

Pascal




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

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Hubris and Ethics
TPS and Agile

Lean/TPS in the Public Service – Part 2 – What are the Obstacles?

By Pascal Dennis (bio)

In my last blog, I noted that morale in the US and Canadian federal governments is at all-time lows.

Morale In The Public Sector

Moreover, the growing gap between performance in the private and public sector fuels a corrosive cynicism and disengagement – surely the last thing we need nowadays.

Why shouldn’t civil servants have the opportunity to develop what Deming called ‘pride of workmanship’? Why shouldn’t they be involved in developing and improving their work processes? Why shouldn’t their work be fun and motivating?

What are the obstacles to Lean/TPS in government? Let’s dig in

Obstacle 1: Government is culturally predisposed to making decisions for political reasons

Ontario residents are enduring a crippling example of this one. Although energy prices have never been lower, Ontario energy bills have never been higher. In fact, the past decade, Ontario energy prices have tripled, and are now among the highest in North America.

Ontario electricity has never been cheaper, but bills have never been higher.

Ontario’s Power Trip: Irrational energy planning has tripled power rates under the Liberals’ direction.

Ignoring the advice of industry & government energy professionals, the governing party has repeatedly made ill-considered forays into the notoriously tricky energy market. (Remember Enron?).

Overall cost will exceed $ 30 billion, or $ 30,000 per resident. Needless to say, the Ontario economy is blighted.

In Lean/TPS terms, the governing party has jumped to countermeasures to an ill-defined problem, and made a mess. Pity the poor government engineer, manager or executive working to develop rationale countermeasures to clearly define problems!

Obstacle 2: Absence of customer or client feedback

Rule 2 of Lean/TPS states that ‘customer-supplier connections must be direct, binary and self-diagnostic’. Such connections drive improvement in the private sector and sometimes contribute to it in health care and education.

Our Toyota plant (TMMC) had abundant feedback through multiple sources including organizations like J. D. Power, and our 3/6/9 month in service audits. My dad’s legendary restaurant, The Imperial Grill, also sought and received direct, frequent & binary customer feedback.

The most common checkpoint was the plates coming back. “Hey Martha,” Dad would say, “you didn’t finish your moussaka. Didn’t you like it?”

“Oh yes, Frankie, it was delicious. But it was big for me.”

“But you liked it! Okay, Spiro wrap it for the lady. She can have the rest at home!”

Obstacle 3: No Continuity of Leadership

Building an integrated management system took us five years at TMMC – and we had constancy of purpose and leadership. (Not to mention splendid, tolerant senseis)
Do government organizations have the same?

Are there any countermeasures?

Difficult obstacles, no?

I invite our readers to share their thoughts on countermeasures. I’ll mull it over too.

The stakes are high for public service members, and for the public.

Best regards,

Pascal




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

Is Lean/TPS Possible in the Public Service? – Part 1
Henry & Edsel Ford – the Pride & the Sorrow
Ethics Enables Leadership
Leadership in Times of Crisis

All Systems Must Support Humanity – Including Lean

By Pascal Dennis (bio)

The Toyota Production System (TPA, aka ‘Lean’) is perhaps the world’s most powerful management system.

Many people (including the Lean Pathways team & I) have dedicated themselves to learning & practicing its methods & mindsets, and to unlocking its mysteries.

Practiced diligently TPS provides a bountiful harvest. Like all great systems, TPS can be all-encompassing. It can absorb practitioners to such an extent that we can lose sight of the most important things.

Such as why are we practising TPS/Lean? What’s our Purpose?

Strong companies & people define Purpose clearly & simply. They understand that Purpose (often called True North) must be simple, visual and compelling. Something for the head & something for the heart.

And therein lies the challenge. It’s easy to forget about the heart. The Lean system, the methodologies & their interplay, is so engrossing that it absorb all our attention.

All systems, including Lean, must support our humanity – not vice versa!

Sadly, we all know organizations that lose sight of this fundamental idea. There’s a hollowness to them, an emptiness that ultimately limits their achievement.

The history of the 20th century teaches us that supposedly “idealistic” systems can even turn monstrous when disconnected from humanity.

So what’s this mean for the practicing manager and leader? Practice what I call the “Warm Heart Principle”: Easy on the people, hard on the process.

It’s not all about efficiency. It’s about effectiveness, achieving both our head & heart goals.

Don’t want to be misunderstood. I am not saying it’s okay to relax standards. Leaders have to be crispy at times, and being so is not necessarily inhumane. (Quite the opposite, in fact.)

I am saying, keep your heart goal close. Let it inform the management system you are building.

All systems must support humanity.

Best regards,

Pascal

Lean/TPS in the Public Service – What are the Obstacles?

By Pascal Dennis

In my last blog, I noted that morale in the US and Canadian federal governments is at all-time lows.

Morale In The Public Sector

Moreover, the growing gap between performance in the private and public sector fuels a corrosive cynicism and disengagement – surely the last thing we need nowadays.

Why shouldn’t civil servants have the opportunity to develop what Deming called ‘pride of workmanship’? Why shouldn’t they be involved in developing and improving their work processes? Why shouldn’t their work be fun and motivating?

What are the obstacles to Lean/TPS in government? Let’s dig in

Obstacle 1: Government is culturally predisposed to making decisions for political reasons

Ontario residents are enduring a crippling example of this one. Although energy prices have never been lower, Ontario energy bills have never been higher. In fact, the past decade, Ontario energy prices have tripled, and are now among the highest in North America.

Ontario electricity has never been cheaper, but bills have never been higher

Ontario’s Power Trip: Irrational energy planning has tripled power rates under the Liberals’ direction

Ignoring the advice of industry & government energy professionals, the governing party has repeatedly made ill-considered forays into the notoriously tricky energy market. (Remember Enron?).

Overall cost will exceed $ 30 billion, or $ 30,000 per resident. Needless to say, the Ontario economy is blighted.

In Lean/TPS terms, the governing party has jumped to countermeasures to an ill-defined problem, and made a mess. Pity the poor government engineer, manager or executive working to develop rationale countermeasures to clearly define problems!

Obstacle 2: Absence of customer or client feedback

Rule 2 of Lean/TPS states that ‘customer-supplier connections must be direct, binary and self-diagnostic’. Such connections drive improvement in the private sector and sometimes contribute to it in health care and education.

Our Toyota plant (TMMC) had abundant feedback through multiple sources including organizations like J. D. Power, and our 3/6/9 month in service audits. My dad’s legendary restaurant, The Imperial Grill, also sought and received direct, frequent & binary customer feedback.

The most common checkpoint was the plates coming back. “Hey Martha,” Dad would say, “you didn’t finish your moussaka. Didn’t you like it?”

“Oh yes, Frankie, it was delicious. But it was big for me.”

“But you liked it! Okay, Spiro wrap it for the lady. She can have the rest at home!”

Obstacle 3: No Continuity of Leadership

Building an integrated management system took us five years at TMMC – and we had constancy of purpose and leadership. (Not to mention splendid, tolerant senseis)
Do government organizations have the same?

Are there any countermeasures?

Difficult obstacles, no?

I invite our readers to share their thoughts on countermeasures. I’ll mull it over too.

The stakes are high for public service members, and for the public.

Best regards,

Pascal

Pascal Dennis Bio