Finding your company way

Tim Akerman
Tim Akerman
Categories:   Leadership   Lean   Process Improvement  
Consulting

I have been thinking about why many lean and six sigma programmes struggle to gain traction. We all know the methods work, you only have to look at people like Toyota and GE to see that. What do they have that others are missing. I have an idea of what causes many of the problems, I would be interested in your views.

Most businesses chase cash investment to grow, sometimes they need cash investment just to survive. At the same time, they deem change to reduce, time, resources and cash used by existing processes too expensive, too difficult or unsustainable! This seems counter productive.

If we now look at how many improvement projects immediately look for reduced workforce overhead for justification we start to see the real problem. Someone recently commented to me that to expect anything else is unrealistic, because there are too many people in most businesses. If a manager has recruited such an excess of people to do the work because they have designed the work ineffectively, perhaps the first headcount reduction should be the manager! I wonder how many managers would enter into a project knowing that at the end one of the management team would be made redundant? I think the answer is none! Yet many of these same people expect their staff to engage in continuous improvement or lean projects, sometimes with a stated aim of headcount reduction, ‘for the good of the business’.

If your business is engaged in a process improvement project that increases capacity, the current perspective of many managers is to say “I can do the same with less resource!”. Is that in the best interests of the business? Wouldn’t the shareholders be more impressed with “I can do more with the same resource!”. This is a more challenging aim, one that places more pressure on sales and management since they are the people who have to find and win the opportunities.

We need to change the mindset of managers from short term ‘protect what we have’ to long term growth and winning new business. Settling for what is there today isn’t what got the business set up and growing. Consider Toyota’s transformation. Ohno Taiichi was not tasked with making better weaving looms, the core business of Toyota, he was tasked with preparing the business for making cars.
The objective of the Toyota Production System was not the product of short term thinking. It was set up to enable the vision of mass car production with limited resources, to allow a weaving loom company to manufacture cars cost effectively. Given that aim, would Ohno Taiichi have been concerned about headcount reduction as he sought process improvement? I can’t see it, I believe he was driven to generate cash and resources for growth by focusing on the customers’ needs, and developing a system of work that involved and engaged all employees in improving the system of work.

So many times I have heard that we have to adopt the TPS and the Toyota Way. Why would you do that if you are not Toyota? The real problem is that we have a consumerist, pick and choose approach to improvement. There are fundamental differences in culture between Japan and the west. It’s not about using this tool or that tool, it’s not even about recruiting the right sort of people. Let’s take a simple example, the attitude to rules. In Japanese society I am told that rules are very important, often more important that principles. Don’t misunderstand me, I am not saying that the Japanese are unprincipled, far from it, this is just about the Japanese attitude to rules. Even if they believe the rule is wrong, they will obey the rule, because they respect authority and the need for order and harmony. Now look at the west, and rules are made for breaking. How could we possibly expect to put in place rules and have them adhered to, no matter what, when our societal attitude is that rules are made for breaking? Principles on the other hand, are adhered to rigidly. So if we agree principles and then try to get someone to act in a way that is not aligned with their principles, they will adhere to the principle, often regardless of the cost.

So how do we compete with companies like Toyota? I don’t believe the answer to is to mimic them, I think the answer is to work out what we want to achieve and the principles we want to operate with along the way. If we treat people as disposable, they will treat the business as disposable. It becomes a marriage of convenience, with commitment until it is no longer fun. Then we move on to the next company. This generates a short term view of employment, success and results that is destructive in the long term. What is the point of a development process that may take 5 years if the people involved at the start will be gone before it delivers? Bear in mind here that Toyota have been developing the Toyota way for 70 years and are still refining their process and thinking. If we implement what Toyota do today without considering how that is supported, initially our organisation won’t be able to cope since the infrastructure and common belief system won’t exist, then we will lose ground on them tomorrow and every day after because improvement won’t be in our ‘business DNA’.

If you want your business to be like Toyota, I believe the first rule is don’t copy them. Copies are often pale imitations of the real thing. They lack authenticity and integrity. Most of all they lack the inherent self belief that what they are doing is right underpinned by a rigorous understanding of why they are doing  it. If you want your business to be like Toyota, first work out what your customers want. Then work out how you can meet that need and make money – what is your business like?. The answer isn’t like Toyota, your business can’t be like Toyota because it isn’t Toyota. Start with understanding what you want to achieve, then move on to the principles of how that will work, then consider if rules are an appropriate way to implement those principles in your society. Don’t demand action from your workforce, first demand that your management understands their role. Then start working through the business processes in a disciplined, scientific way to understand what every part of the business is trying to achieve. Once this is known compare what each department is trying to achieve with what the business objectives are – do they align?

Plan what must be done

Do what has been planned

Check that the activity delivered the expected results

Act on the results, reinforce the practices and activities that yield successful results, change the practices that are not aligned or don’t deliver success.

Then do it again.

Keep doing this until there is nothing that can be improved upon, wither by listening to other thought processes or by applying new knowledge

You see the pattern. If you do this you will develop your own way, tailored to your business and social environment. Then perhaps, if you are very disciplined, one day people will be talking about the {insert your company name here} Way. They may even prefer it to the Toyota Way. Who knows, you might get Toyota coming to learn from you. Toyota had the advantage of learning first hand from Deming, Juran and others. They had the presence of mind to write down much of what they were trying to convey, for which we should be grateful. Their guides are not a buffet of choices, they are hard practical realities, hard to understand and even harder to implement,

I was recently reminded of one of Dr Deming’s favorite quotes:

“American managers are stupid. They think all they have to do is copy from Japan, but they don’t know what to copy”

To be honest I think we can remove American managers and substitute Western managers.

I would add my own favourite Deming quote:

“You don’t have to change. Survival is not compulsory.”

Finding your own way is hard, but it is the only way to get to somewhere new and exciting.

One final point, if you ever do get to the point where you think nothing can be improved, get out there and start talking to people. You have missed something and if you don’t find it and use it your competitors will