What do you say we make a New Year’s resolution – all of us in the lean community – that we (especially me) spend a lot more time in 2006 looking at our own failures and weaknesses, and less at those of senior managers? I keep using the Clifford Ransom numbers – 98%+ lean failure rate – which most folks seem to think jives with our feel for the situation. The mantra we spout far too readily to explain away this debacle tends to fall collectively under the heading of senior management character flaws. Senior managers don’t understand lean and have not taken the time to learn it; they need to display ‘leadership’ and more passion; they need to start caring about their employees; they need to care more about their customers and quality. To listen to most of our suggestions, the senior manufacturing management in America consists almost exclusively of ignorant, selfish louts out to squeeze every drop of blood from the workers and cheat the customers at every turn. Michael Moore may go along with this view of our management, but those of us who work in manufacturing every day know better.
In fact, common sense dictates that all of this carrying on about senior management intellectual and character weakness is nonsense. The men and women at the top of these companies did not get there by being stupid, uncaring or unable to lead. Of course there are exceptions, but we all know that the senior managers are generally very intelligent, very hard working and very committed to success. We raise these criticisms not because the senior managers are incompetent, but because they do not see things our way. In truth, if they do not see the merit in lean manufacturing and a clear path to get there, it is because we have collectively failed to explain lean manufacturing in its entirety and a logical method for senior managers to bring it to life in their companies.
As lean consultants, proponents and advocates, we need to look at senior management as our customers. Blaming the customer for failure is not usually a very effective means of improving things.
Manufacturing (all business for that matter) is aimed first, last and everywhere in the middle at making money in the long and short term. We have done a lousy job of explaining how lean manufacturing accomplishes that end. Simply pointing to Toyota and saying they are lean and they make a lot of money is not enough to expect senior managers to leap headlong into lean. In fact, many managers such as those at Delphi, did make a leap and did many of the things we lean advocates told them to do – and failed.
The 98% failure rate is not proof of weak senior management – it is proof that the lean body of knowledge is incomplete. All of us – those who click on Superfactory and elsewhere every day to learn, and those who sign in to teach – need to step up to the glaring hole that exists somewhere in the package. My own opinion is that Lean Accounting, Lean Marketing and Sales, and Lean Management are the big unexplored frontiers that we need to get our arms around before we will be in a position to blame management for failure. But I am wide open to suggestion. What I know for sure is that far too many companies have bought exactly what we are selling and saw little or nothing at the bottom line for the problem to be senior management.
Like Pogo said, "We have met the enemy and it is us." Let’s all get to work on it in 2006.
Thomas says
I agree wholeheartedly. So where does someone go to learn how to understand both Lean and ‘traditional’ accounting well enough to help the non-ignorant but miss-guided managers know better? I know I need to be able to speak both systems well enough to catch and hold the interest/attention of those that know only one, but I have no idea where to start learning. While my position will not allow me to attend the Summit, my company will pay for any accredited degree program. Any suggestions?
Bill Waddell says
Thomas, my unbiased, objective recommendation is that your non-financial managers read my book, Rebirth of American Industry, to fully understand how traditional financials undermine the lean effort.
The accounting folks in your organization should get in touch with Brian Maskell http://www.maskell.com/ He is the ranking lean accounting wizard, in my opinion, and he has written a couple of very good books and does training and consulting work.
Jon Miller says
Hi Bill,
Another solid post. I agree with your conclusions.
On the Ransom numbers I’m not sure I see things the same way. Perhaps I use the terms ‘failure’ and ‘Lean’ differently.
There’s terminal failure, like Delphi’s and there’s day to day failure, which is an inherent part of kaizen.
Then there are specific failures such as not linking Lean efforts explicitly visible on financial statements.
Cash flow and profit are important. Using stock price performance, which is by nature not primarily a measure of long-term company performance improvement, to arbitrate Lean success or failure (i.e. cultural shift, which fundamentally is only visible over the long-term thing) doesn’t seem right to me.
How do you see this?
Jon
Karen Wilhelm says
To add to Jon’s comment, there is failure you learn from and failure you don’t. When you blame workers-union-China-etc., fire the top managers, or “reorganize,” you have not learned from failure. To learn from failure, it should be the result of a scientific experiment where a variable was changed in quest of an improvement. Then you can go back to the control state without disaster occurring. Of course, where there is no control state, you have a lot of work to do. I say this as an onlooker, however. What do practitioners say about this?
[How many people these days actually remember the Pogo comic strip? Do we all have gray hair (sans Clairol)and arthritis? Maybe it’s time for a new catch phrase.]
Michael says
Can anyone give me the link to the “Clifford Ransom numbers – 98%+ lean failure rate – which most folks seem to think jives with our feel for the situation.” ?????
Thanks