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 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

Igniting New Growth - My Improbable Journey, Part 1

Pascal Dennis, co-author of (Harnessing Digital Disruption)

Singapore, Toronto, San Francisco, Bangkok, KwaZulu-Natal, Auckland - all these are part of my improbable journey these past eight years. It all began with a delayed flight out of a Moroccan airport. It was the summer of 2017. I was sitting in the backyard with my wife, Pamela.

Laurent Simon, who would become my friend & business partner, was the one in Morrocco. He decided to send a LinkedIn note.

‘I like your books,’ he said. ‘We should write one together…”

‘About what?’ I asked.

“Harnessing digital disruption…”

Laurent Simon in San Francisco

As we chatted, I checked out Laurent’s LinkedIn profile: INSEAD business school, and impressive achievements in the cosmetics industry, management consulting & financial services. Head of Innovation leader at a major international bank. A smart guy.

‘I’m having a drink with my wife,’ I told him. ‘Maybe we can chat some more next week.’

And thus began our weekly WhatsApp calls. Laurent described his innovation work in the Asia Pacific region. I described my adventures in manufacturing, consumer goods, and health care. And the fun & business results my team & I had enjoyed working with a marvelous financial service company. Each week I would summarize what I’d learned in a mind map, which became part of our body of knowledge.

Laurent and I were natural disruptors, simpatico both professionally and temperamentally. I loved being a Strategy sherpa and mentor to senior leaders. But I was also a composer & leader of the Crazy Angels band. Laurent was a Renaissance man who swam effortlessly in multiple languages and cultures.

Pascal Dennis in San Francisco

Laurent lived in Singapore; I lived in Toronto. His environment was heat, humidity and rain. Mine was snow, ice and the cold wind sweeping down from Hudson’s Bay. We finally met in person in the fall of 2017 at a conference in Kwazulu-Natal, South Africa, where I was giving a talk. And that’s where we added another routine – long walks during which we would ‘shoot the breeze’. Soon after we began to have regular meetings in Singapore, Toronto and places in between.

We had both spent the previous decade helping companies transform their work, people and management systems. We’d both seen the power of the so-called Lean management system – the methods and mindset underlying the Toyota Production System. We understood that Lean represented a series of revolutions that had ‘changed the world’:

• Quality in the process – the realization that all work comprises a system of activities and information, and that the value chain will only work if each step was done right the first time
• Flow – understanding demand, capacity and the process in great detail; applying the laws of so-called production physics to maximize flow and minimize lead time and cost
• Continuous improvement – the realization that virtually nothing in the work is ‘fixed’, and that things like working content, sequence, layout, timing are all malleable and can be endlessly improved
• Leadership – the art of defining, deploying and executing a great aspiration in accord with a concise winning logic; how to build a learning infrastructure to supports, develops and deeply engages people
• ‘Customer in’ mentality – putting oneself in the customer’s shoes, and deeply understanding their needs and wants
• Strategy and decision-making – how strategy is developed and implemented; how we align and motivate disparate groups of people in complex organizations toward a shared Aspiration; how we make problems visible and deploy remedies; how we overcome the thorny problems of governance.

But Laurent and I differed on a critical point. He believed that Lean is essentially about protecting your core business, and not about igniting new growth. I disagreed: ‘Lean is also a growth strategy,’ I argued. It took a while, but I came around to Laurent’s point of view. Lean is necessary, but not sufficient. If it was, why were the business valuations of GAFA - Google, Amazon, Facebook (Meta) and Apple – higher than those the great industrial companies I revered? Had Toyota, Honeywell, Proctor & Gamble and the like lost their mojo? Certainly not – the great industrials were as strong as ever. Something was happening, and I was determined to find out what it was.

Best wishes,

Pascal Dennis




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

Year-End: Why Is Reflection So Difficult?
What is a Good Life?
All Systems Must Support Humanity – Including Lean
To Learn Corporate Strategy, Study the Military Masters

Lean is a System

By Pascal Dennis (bio)

The eternal verities are just that, and we need to keep returning to them.

Lean methods have such an appealing clarity and intuitiveness that we can easily lose sight of the most important thing:

They’re just tools – methods, drills, routines that are part of a broader system and set of principles.

And that system, which some people call the Toyota Production System (TPS), helps us continually address the most important questions of management:

• What is our Purpose?
• What should be happening?
• What is actually happening?
• How do we get back to a good condition?
• What is our ideal condition?
• What will we do next to get closer to our ideal condition?

These questions are a fractal, of course, and apply at all levels from the front line (Level 1) on up.

And as parts of a system, Lean methods must express the core principles, and connect to:

• Purpose, and
• One another

If a given method, say 5S, does not connect to our over-arching Purpose, by helping to make problems visible, for example, why are we doing it?

And a given method like 5S only makes lasting sense and provides lasting value if it is connected to other methods, which in turn are connected to Purpose.

So 5S is connected to Standardized Work, which is connected to building quality into the process, which is essential if we are to flow our products & services to our customers, which is essential to meeting our Purpose.

You get the idea. Sorry to belabor the point, but losing sight of our core principles and purpose is a clear & present danger, perhaps the biggest one facing the ‘Lean movement’.

If we navigate according to our principles & purpose, we can change the world.

If not, we’ll perhaps deliver some helpful cost savings, and while being relegated to the dusty & damp management tool shed.

Best regards,

Pascal

Creativity & Innovation

By Al, Norval,

In a previous blog I wrote the problem of organizations pushing products out to customers rather than having customer problems pull products from Designers. As a countermeasure to this, Lean Innovation needs to:

 

• Develop a deep understanding of Customer problems through direct observation of the customer experience
• Eliminate waste from our Product Design processes  
• Carry multiple alternative deeper into the design process to allow time to explore alternatives

 

Doing this allows the creation of an environment that fosters creativity and innovative solutions to customer problems can come alive.

But how do we become creative all of a sudden? Many times I’ve heard it said, you can’t schedule an invention.

We start by “thinking like a twelve year old”. Why think like a twelve year old? We invoke our twelve year old mindset since it was one of curiosity that wasn’t encumbered by the structured learning process adults go through. An unfortunate by-product of this learning process is that adults stop asking why and how. To think like a twelve year old, we must unlearn many of things we learned becoming adults.

To help us with this new way of thinking we look for seven alternatives for any problem we are faced with. Why seven alternatives? Developing a couple of alternatives is easy but developing seven is difficult. This causes us to stretch and begin to think out of the box. To further assist us in our creative thinking we look for inspiration from nature. Natural designs are elegant in their simplicity. Understanding this and applying them to our problem leads to creative alternatives we would never have come up with before.

Developing seven alternatives is one thing but we must then quickly turn them into working prototypes. Not fancy and costly prototypes but quick and crude physical mock-ups. We need to make the intangible concepts into something people can look at, touch, feel and even listen to and smell. We activate all of our senses to help us learn more about the prototype. We call this type of learning “Trystorming”. It’s brainstorming with a practical, physical application that accelerates the learning process which becomes a platform for even more creative ideas. We use the learning from several prototypes to refine our designs and converge on an optimal solution.

All the while we’re practicing PDCA and with rapid experimentation and feedback.

Can we schedule inventions? – No, but we can certainly accelerate the process of designing creative value added solutions for our Customer problems.

Paying more than list price.

Target Conditions vs Random Acts of Improvement.

What can we do vs what do we need to do.

 

 

 

Customer Focussed Innovation

By Al Norval,

Ever notice how many companies push products out to customers rather than first understanding what Customers really find value adding and then designing products to fill that need?

Why is it that organizations do that?

It starts with not taking time to understand the Customer and their needs. Every product design is a countermeasure to a Customer problem. Before we can design the product we need to have a deep understanding of their problems. Not just the things that people will tell you in focus group feedback sessions but the deep, unspoken, unarticulated needs they have, many of which they don’t even realize they have. To do this we need to study our Customers, live in their world, experience their problems through their eyes. This allows us to truly Grasp the Situation and start the problem solving process following the PDCA cycle. It allows us to define the problem in the Customers terms. Only then will we have the insight to design products and services that will provide value to our customers.

But knowing this, why is it that many companies still don’t do it?
As I’ve reflected on this, I’ve come up with a few reasons. It takes time and resources to study our Customers both of which are in short supply when designers are pushed into meeting shorter launch time lines and shrinking budgets. It’s often easier to assume we know what’s best for the Customer. This is a type of Hubris or Big Company Disease both of which we’ve written about in previous blogs.

Another reason is we get attached to one particular concept and keep pushing it through to launch even though feedback and data say we shouldn’t. By the time we realize the product is flawed it’s too late since we have nothing else. Again Hubris and arrogance lead to poor product acceptance in the marketplace.

Interestingly enough, the root cause in both cases is a product innovation process that is full of waste.

True Lean Innovation is about taking the waste out of the Design process and carrying several alternatives deep into the process to allow designers time to explore alternatives until the last possible moment. This way we can launch products that deliver more value to customers. Having a process like this allows creativity to flourish since we are not forced to pick the one best idea very early on in the process.

In another blog, we’ll talk more about how to foster creativity as part of our design process and how to look at many alternatives and slowly converge on a solution. But none of this is possible without first and foremost taking the time to truly understand what drives the value proposition for your Customers.

The Remedy Wins the Shingo Prize

By Pascal Dennis,

The good people at Shingo Prize have seen fit to give The Remedy the nod.

They do important work & I'm humbled and deeply obliged for all their efforts.

It's an odd feeling. After finishing a book, I often forget I what I wrote.

(Maybe because the process is so intense & exhausting -- you need a break from the damned thing...)

"That's the other Pascal," I joke. "I'm his idiot brother."

Still, it's a footprint in time, a nod, a tip of the hat -- a sign that somebody finds your stuff helpful.

For that I am deeply grateful.

Pascal

P.S. BTW ya'll, be sure to attend next year's International Shingo Prize Conference, May 7 - 10 in Atlanta (http://www.shingoprize.com/).


I'll be there for sure!

Root Cause of Health Care Crisis?

By Pascal Dennis,

Health Care is a disaster North & South of the border.

Neither Americans, nor Canadians can look on their situation with any satisfaction.

Costs are exploding -- and crowding out other critical expenditures like education, R & D and infrastructure.

Health care outcomes are disappointing. Miracles occur within the silos, catastrophe across them.

What's the root cause of this sorry state of affairs?

Why can't smart, skilled and caring medical professionals do what they're trying to do?

Deming taught us that the problem is in the system -- and he's right again.

Mis-medication, wrong site surgery, infection and other nosocomial calamities occur despite the heroics of nurses, doctors, pharmacists and the many other specialists who keep hospitals going. Indeed, things would likely be much worse but for their heroics.

So what's the root cause of our health care crisis?

Tom Papas, the protagonist of the business novel, The Remedy, tries to answer this question in chapter 13.

He is in rough shape -- he might be losing his father to a mis-medication.

Tom's conclusion: the customer is not the customer.

Only patients, he concludes, can arbitrate the millions of daily decisions that comprise the provision of medical care.

Yet the patient is not the customer in these transactions.

As evidence he reflects on how difficult it has been for his family to get Safety, Quality or Cost information from hospitals.

"And why should they give me info?" he laments. "I'm not the customer."

I've gotten a lot of mail about this chapter!

So what do ya'll think? Is Tom right, or is he not thinking clearly because of his desperate situation?

Are there other root causes that are more important? Any other thoughts or insights?

I'd be pleased to hear from you.

Best regards,
Pascal

Strategy Deployment & the D-Day Invasion

By Pascal Dennis,

On June 6, 1944 a vast allied army landed on the beaches of Normandy and began the liberation of Europe.

General Eisenhower commanded the attacking force -- five beaches and five attacking armies.
 

General Irwen Rommel, the Desert Fox, commanded the defenders -- (with little support & much interference from Berlin)

D-Day was a triumph of strategy deployment against long odds. It was the biggest amphibious assault ever planned and the failure modes were daunting.

What if the preceding naval bombardment failed to disable the Nazi guns?

What is the sea was rougher, the waves higher, the tide stronger than expected?

What if the cloud cover lifted and the moon lit up the attackers?

What if, what if, what if -- the strategist's eternal question.

How did Eisenhower and his staff deal with these uncertainties? Did they dictate the tactics of each army at each beach?

"Thou shalt..."

For example, did they dictate minute assault details, in advance, to the Canadian Army on Juno beach or the American 1st Army at Omaha beach?

Of course not -- it would be absurd to do so. Only the army in the field can adjust to the conditions on the battlefield -- they see them best.

In my experience, "Command & control" in military circles does not mean "tightly control/limit/inhibit" -- as it does in civilian circles. It simply means Check & Adjust your plan.

Eisenhower provided overall objectives to each army and suggested tactics -- knowing that these would be adjusted in the field of battle.

Rommel, by contrast, was hindered by interference from Hitler and his inner circle -- people remote from the battlefield, who had rarely, if ever, visited Normandy.

What's the lesson for those of us who develop and deploy business strategies?

Follow the recipe laid out in The Remedy and Getting the Right Things Done:

1. Develop the plan

2. Deploy the plan

3. Monitor the plan

4. Improve the system

Deploy the plan does not mean controlling every tactical element. It means providing guidance and support for those in the battlefield.

It means teaching them how to translate overall objectives into meaningful tactics -- and giving them the freedom to do so.

Don't worry -- you're not giving up control. You'll have plenty of chances for input in the Check & Adjust phases.

Think of strategy as a river. Leaders define objectives (getting to the sea) and the banks of the river.

Then they let the water go.

Check out The Remedy or Getting the Right Things Done for more.

Last & most important

Let's honour our D-Day veterans, who put their lives on the line to make a better world.

Thanks for all you did for us.

Lean Laughs



Innovation

By Al Norval

“None of my inventions came by accident. I see a worthwhile need to be met and I make trial after trial until it comes. What it boils down to is one per cent inspiration and ninety-nine per cent perspiration” – Thomas Alva Edison



Fabulous quote from one of the greatest inventors of all time. Edison was very familiar with the scientific method and how it is embodied within the PDCA cycle. It starts with a deep understanding of the Customer, their unmet needs and the problems they are having. From this he was able to define the problem and form a hypothesis after which he would run a series of experiments. The key was the Check/ Adjust of each experiment against his hypothesis. The power of a hypothesis is in its binary nature which allows the scientist either confirm the hypothesis or rule out that experiment. In either case, Edison knew the power of knowledge gained from each experiment. In that way he didn’t see experiments as a failure as he learned something new from each one. What he learned allowed him to constantly refine his designs until he had one that met his hypothesis.

For the electric light bulb this involved over a thousand experiments until he finally came up with a carbon filament that would pass the test of time.

Perspiration indeed!

For us within the Lean community the same holds true. Rapid experimentation against the problems we are trying to resolve, leads to faster learning and ultimately better countermeasures.

Can we all learn from Thomas Edison – observe, set a hypothesis, experiment, check, learn, make adjustments, repeat.

Sounds simple, all it takes is a little hard work.

Empowering Team Members

By Al Norval

Many organizations talk about Empowering people.

In truth they may ask for people’s opinion or input on ideas but that speaks more to involving people not to truly empowering them. To empower people means we will allow and encourage them to solve problems for themselves. This means Leaders don’t undermine Team Members or second guess the countermeasures the team has come up with. Rather it says Leaders must coach and mentor their teams developing the teams capability along the way.

Sounds simple. But what happens when the problems the team face exceeds their capabilities?   Team Members become anxious and learning stops. The easy and expedient answer is to give the problem to someone else. While this may lead to quick resolution of the problem, it does little to build the capability of the organization for the long term.

What happens when the opposite occurs – when the problems the team faces are less than their capabilities?  Team Members become bored and give up. Again no learning occurs within the organization.

The key is to give teams problems that are a good match for their capabilities. When this occurs Team Members excel. The key for Leaders is to give teams and team members problems which stretch their capabilities without exceeding them. Adults respond to this challenge and work becomes interesting and learning occurs. Over time the capability of Team Members and in fact the organization as a whole goes up.
With more capability, more problems can be addressed leading to a cycle of continuous improvement.

This entire process requires finesse on the part of Leadership – giving people problems that are not too hard and not too simple.  Finesse enabled by Mental Model #2 – Go to Gemba to see and understand for yourself.

Yokoten

By Al Norval

In the Lean world we hear all kinds of Japanese words. Indeed, it seems like a badge of honour to know obscure Japanese words that baffle your fellow teammates. I’d like to highlight one that isn’t mainstream but is critically important – Yokoten.

Yokoten is a process for sharing learning laterally across an organization. It entails copying and improving on kaizen ideas that work. You can think of yokoten as "horizontal deployment" or "sideways expansion". The corresponding image is one of ideas unfolding across an organization. Yokoten is horizontal and peer-to-peer, with the expectation that people go see for themselves and learn how another area did kaizen and then improve on those kaizen ideas in the application to their local problems.

It's not a vertical, top-down requirement to "copy exactly". Nor is it a “best practices” or “benchmarking” approach nor is it as some organizations refer to a “lift and shift” model. Rather, it is a process where people are encouraged to go see for themselves, and return to their own area to add their own wisdom and ideas to the knowledge they gained.

Simply put, Yokoten equals copy and improve. The role of the senior managers is to make people aware of the existence of these good kaizen examples so that they can go see for themselves, gain the knowledge and improve upon it further. Simply telling subordinates to copy it may be kaizen of a sort but it would not serve the second important aspect of the Toyota Production System, the respect for and development of people.

An effective Yokoten process is a critical step to building capability within the organization and becoming a true learning organization. It truly is one of the capabilities of outstanding organizations.

Lean Laughs



The Work of Leaders

By Pascal Dennis

Had a eureka moment the other day: The leader's job is to ensure that all their people are working on the right things.

Rather bland, but true, no?

Respect for humanity means I won't waste my team's time asking them to do stupid or wasteful things.

Here's an extreme example to illustrate the point:

One of the most vicious punishments meted out in the awful Soviet gulags was this:

Spend all day digging out a large hole. Then spend the next day filling it back in.

Prisoners would go mad with the meaninglessness of it.

But consider how it parallels so much corporate work.

I've seen good, smart people doing much the same work -- at the whim of some executive, or to satisfy some absurd corporate rule.

"Dig out that hole! Now fill it back in!"

After a while people really do get twitchy. To paraphrase Winston Smith at the end of Animal Farm,
"Two plus two really does equal five..."

So those of us that are lucky enough to be leaders have to accept this heavy responsibility.

Use my people's time wisely.

They're not cannon fodder.

P.S. Check out Getting the Right Things Done for help on how to do this!

Lean Outside the Factory -- Reverse Magic!

By Pascal Denis

Last Fall, I had the pleasure of taking my teenage daughters, Katie & Eleanor, to Las Vegas.

We'd hoped to see the great magician, David Copperfield, who I'd seen make tigers, elephants and the like disappear. On TV I saw David make the Statue of Liberty disappear.

 

Sadly, he was out of town & we had to settle for Cher...

Anyhow, somehow I made the following connection. (Must have been the desert air...)

 

Lean's next frontier is the office -- sales, marketing, engineering, design, planning & scheduling, finance and so on.

 

Deploying the "profound system of knowledge" here requires us to perform reverse magic.

David Copperfield makes visible things, invisible.

 

 

We have to do the opposite & make the invisible, visible.

Office work, is what Peter Drucker called "knowledge" work - most of it is hidden in the box knows as a computer.

Our job is to take it out that box and put it up on the wall, where everyone can see it.

Otherwise, waste multiplies exponentially, and our office processes become our constraint.

 

Here's a challenge for you:

 

a) review total lead time for your top three value streams,

b) where is most of the delay -- in operations (factory, hospital ward, laboratory etc) or outside operations?

 

 
If you're like many organizations, most of the delay in outside operations.

 

Yet where do we spend most of our improvement work?

 

So...let's work our magic and make the invisible, visible. Then our Lean activities can really take flight.

 

That's what The Remedy -- Taking Lean Out of the Factory to Transform Your Organization, is all about.

Lean at the Imperial Grill -- and at Starbucks

By Pascal Dennis

Had a good time in Dallas at the LEI Transformation Summit. I gave a presentation on Big Company Disease (and The Remedy), which people seemed to enjoy.

I much enjoyed the Starbuck team's presentation on their Lean transformation work. Took me back to my dad's restaurant, The Imperial Grill, where I grew up & which figures in all my books.

You can't succeed in a family-owned restaurant -- or a Starbucks if you don't apply Lean fundamentals.

Waste & value, visual management, standardized work, 5 S, close connection to the customers, simple replenishment pull and so on are simply common sense.  At the Imperial Grill I experienced each form of waste viscerally. Motion waste, for example, means sore feet.

The best waiters and waitresses effortlessly serve multiple tables with minimal motion.

They always add value whenever they move -- by greeting a customer, clearing a table, or closing out a tab.

Waiting waste means unhappy customers who don’t come back. Conveyance waste means unnecessary trips to the farmers market to get our meat and produce. Correction or scrap waste means making the wrong thing, or overcooking something, and having to throw it out. Over-processing means too many steps in a process, so you fall behind -- a killer during the breakfast and lunch rush. Inventory waste means carrying more raw materials than you need, which means either throwing stuff out when it goes bad, or buying a bigger fridge. Knowledge waste means wasting your time doing the above when you could be improving the business.

My senseis taught me that overproduction is the worst form of waste -- because it entails every other kind of waste. At the Imperial Grill, making more than we could sell meant was unthinkable, a sure way of going out of business. My parents understood value and waste in their guts, and had a deep connection with their customers. As a result, the Imperial Grill thrived against tough competition from national restaurant chains.

My folks are retired now and the Imperial Grill has given way to luxury condominiums. But it lives on in The Remedy and other books!

Power of Simple Images

By Al Norval

Complexity is over-rated!

It’s easy to be complicated but it’s difficult to be simple. Elegance is simple, yet it is not easily achieved.

One of Lean’s most powerful principles is to make things visual. People often do this yet fail to think about what message they are trying to convey. The result is overly complex visuals which fail to meet their purpose. Confusion reigns. Instead, what we really want is to be able to understand the current condition at a glance. Then we can tell if we on target or off target so we can launch problem solving.

The same holds true in our communications. We’ve often heard that a picture is worth a thousand words but what if that picture is so complicated we can’t understand it. A thousand words may not be enough to explain it. In today’s age of powerful graphics available on every laptop, we often see fancy slides that look like a Las Vegas light show. We call this Powerpoint Junk. The image is so complex the message is lost.

Gen. Stanley A. McChrystal, the leader of American and NATO forces in Afghanistan, was shown a PowerPoint slide in Kabul last summer that was meant to portray the complexity of American military strategy. “When we understand that slide, we’ll have won the war,” General McChrystal dryly remarked, as the room erupted in laughter.

The Mental Model of simple visual images for all important things can dispel the fog of Big Company Disease and allow us to focus on the real problems.



Cheers

Supporting the Value Stream

By Al Norval,

Where is value created?

In the value streams where people change or transform the functionality of materials or services into things which our customers are willing to pay for. It isn’t created in the staff groups that live in Corporate headquarters. Yet, the question often comes up – who is there to serve who?

Wouldn’t it make sense for staff groups to work on problems that eliminate waste from the value streams. This allows our people to spend more time creating value for our customers. Alas, often this isn’t the case. Instead we see staff groups acting like petty bureaucrats making and enforcing policies that take people away from doing value added work in the value streams and spending their time on things they weren’t trained for or filling in reports to managers in faraway places who would never dream of going to Gemba. Why? It’s easier to ask someone to fill in a report for me.

A recent example that comes to mind is a large multi-national company that downsized it’s HR dept. Now all inquiries about benefits, job postings, and in fact any HR policy were to be handled by the Team Leaders and the Shift Supervisors. Without the depth of training and experience to handle the issues that come up, these folks now spend large portions of their day chasing around searching for answers to questions raised by Team Members. The rate of improvement has slowed down but they did reduce costs in HR.

Wouldn’t it make sense to do things the other way around. To focus on eliminating everything that takes away from front line people doing value creating work for our customers. Isn’t this the real role of support staff – to support the value stream and the people in it.

Lean Laughs