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The Big Picture

by BILL WADDELL

Here's the way I see lean:

Lean Business Model

This is pretty much the model I use when I am writing about companies or concepts for Evolving excellence, doing my company assessment work; or teaching at a conference , seminar or company presentation. Click on the graphic and it will get big enough to read better. 

You have to be hitting all three corners, or you might as well not do anything.  It's not a cafeteria where you get to pick and choose what you want or what's easy.

Most companies - I mean the overwhelming majority of companies - are doing something with the bottom part - the tools and techniques.  Most are doing little or nothing with the management part. 

Most would like to do something about the culture and people part, but can't reconcile it with their ingrained management concepts ... that production people are a variable cost (which means they vary with volume, which means there is no avoiding the fact that when business is bad enough you just gotta lay 'em off) ... and that organizations are a semi-formal military sort of thing - they go from top to bottom and people on top give orders while people below them follow orders.

Hardly anyone calls me for help to start a lean journey.  They call me after they have been at it for a while and years of training mid-level and shop floor operations people in lean tools, and deploying them with 'CEO leadership' along with platitudes about culture and people haven't transformed the company into Toyota.  The failure is easy to diagnose ... 999 out of 1,000 have not changed the management piece one iota.  Same accounting, same basic metrics, same organizational structure, same ERP and quality systems, same conviction that 'top line' growth is always, inherently a good thing no matter what ... same results.

A couple of pretty much universal facts (at least facts based on my 20+ years of experience):

Culture can't change when the company still has management systems and measurements that say reducing headcount and labor costs is a good thing.

Lean never helps when cost reduction is the primary objective.

Demand pull is central to the tools piece, as well as the management piece. Nobody gets lean while hanging onto excuses about demand pull not being applicable to their business.

Nobody gets lean who sets their prices based on standard costs; and nobody gets lean without sales and marketing being equally involved in the transformation process.

Anyone who seems to be an exception to the above never sustains, making it pretty easy to appear to be a fortune teller when predicting their eventual demise.

Original: http://idatix.com/manufacturing-leadership/the-big-picture/

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2 Responses to "The Big Picture"

  • Marty Yuzwa
    15 May 2012 - 6:36 am

    Totally agree Bill. . . We started our journey with most of our efforts in the management section. I highly recommend that approach.

  • Steve Brenneman
    15 May 2012 - 6:48 am

    Well said Bill! Unfortunately it will probably be ignored by most company leaders who see lean in a different way than this. This is a different universe than we were taught to live in!!! Just give me a tool and show me how to use it! Don’t give me all this other BS.