by BILL WADDELL
With lean built on a foundation of respect for people, value to customers, true partnerships with suppliers and the elimination of waste which dictates an environmentally responsible approach to manufacturing, lean is very much in keeping with the urgings of the Pope in his recent Encyclical when he wrote that "business management cannot concern itself only with the interests of the proprietors, but must also assume responsibility for all the other stakeholders who contribute to the life of the business: the workers, the clients, the suppliers of various elements of production, the community of reference."
The logic and demonstrated results of the true lean companies demonstrate that this inclusive approach to running a business generates superior profits. It implies, however, a commitment to ethical behavior that seems to be beyond the reach of an increasing number of managers, and, in fact, the cultures in which many of you are trying to lead your companies. Greed is the antithesis of lean Lean management requires accepting responsibility for the welfare of all stakeholders, and treating them with genuine respect. That antithesis has become so prevalent in western culture that lean is beyond the reach of many companies.
Consider today's business news:
In the London Times there is an article discussing the practice of packaging items in smaller quantities, while keeping the price the same in hopes of sneaking price increases past gullible customers. The author of the article writes, "Whether supermarkets and manufacturers should “fess up” to changes is open to debate." Debate? No honest person is on the side of the debate arguing for deception.
The management at BAE Systems faces criminal indictment for bribery … again.
An IBM Senior Vice President was arrested for insider trading.
The former CEO of Germany's second biggest bank is facing criminal charges for skimming millions from a deal he engineered before taking bailout money and nearly putting the bank under.
MPC Products in Chicago settled criminal fraud charges and two of its vice presidents face criminal prosecution for falsifying charges to the government.
A lawsuit in New Jerseyover false claims of defective plastics is further compounded by an exert witness who was illegally paid for his 'expertness' concerning SAP software.
Siemens, German truck maker MAN Nutzfahrzeuge AG, bridge builders Mabey and Johnson, Liberty Apparel, Daewoo, Haliburton, Control Components and even the producers of a movie called "Rescue Dawn" are all tangled in court somewhere for bribery and other criminal activities. The disregard for the employees, customers and suppliers of these companies is breathtaking. Thousands of people's livelihoods and well being hinges on the actions of the managers of these companies, and the people who accepted that responsibility are lining their own pockets, putting everything and everyone else at risk.
Christians, Jews and Muslims all ascribe to the Old Testament of the Bible, so it does not strike me as forcing my Christian beliefs on much of anyone when I cite the Book of Amos. God tells Amos in Chapter 8 that there are those who wonder when the Sabbath will be over so they can go back to selling wheat with "false balances". He then goes on to tell Amos that the days are coming when people who approach business that way are going to find themselves in some serious misery – including "baldness on every head".
I don't know if God is really going to snatch every unethical businessperson bald, but I do know that only those managers who believe that accepting a paycheck for making decisions that affect the lives of employees, suppliers, customers and communities is a sacred trust – that it confers a responsibility for putting the welfare of those who have placed their trust in you ahead of your own interests - can ever achieve lean results.
Jim Fernandez says
Gee as a Lean practitioner I did not know that God and the Pope were on my side. Now I feel much better..!!!
Oh and regarding “those managers who accept paychecks for making decisions that affect the lives of employees, suppliers, customers and communities”. If your worried about making sure they understand “that it confers a responsibility for putting the welfare of those who have placed their trust in them ahead of their own interests”; Don’t worry, President Obama and the Democrats will see to it that those managers won’t have to make that moral decision on their own.
Bill Waddell says
I don’t think God or the Pope have an opinion on Lean one way or another. I do think they have an opinion on business people who use their position to take advantage of customers, employees or suppliers in an unethical way in order to personally enrich themselves; and that such behavior is the opposite of lean leadership.
Concerning Obama et al, while they are seeing to it that business people are ethical, who do suppose is going to see to it that they are ethical?
I must have been one of those unethical businessmen in a past life for I am quite bald in this incarnation. As a lean practitioner maybe I am making some small amends for past sins now–so maybe my hair will grow back!
Jim Fernandez says
I do agree with you regarding the ethics of Lean. And that there are more and more unethical company owners and managers. And it’s very sad.
Candy bars have been getting smaller and more expensive ever since I was a young boy. If I don’t think a particular candy bar is worth the money I’ll buy a different one. You pointed out that In the London Times there is an article discussing the practice of packaging items in smaller quantities, while keeping the price the same in hopes of sneaking price increases past gullible customers. You further state that there should be no debate about it because “No honest person is on the side of the debate arguing for deception.” So I assume that you are against the free market. You would not allow a company to regulate the amount of product they sell nor the price they sell it for. You would somehow regulate the market rather than let a different company compete with that company that sells less product in their packages. Or in other words, people are too stupid to spend their money wisely so we need to protect them.
You can cite many unethical business practices by company owners and Managers. But we need to be very careful with this information and not use it to ruin what little we have left of our capitalistic system. For instance, recently many large financial institutions were faced with going out of business. This due to bad decisions and probably some unethical activities. As you mentioned, under God’s plan they should have gone out of business as in, “they are going to find themselves in some serious misery”. And if they had gone out of business they would have left behind the more ethical and well run institutions.
But instead we (our government) bailed them out. For primarily the same reason that you suggest. Because they have an obligation to their customers, suppliers and workers. As I said before we need to be very careful where this thinking takes us. Now because of the bailout we have the same guys running the same businesses waiting to make the same mistakes as before.
I like God’s plan. He allows his children to fail so that they learn things. He allows me to reduce the value to my customers. He allows me to do unethical things. He allows me to hire and fire whom I want. He allows me to go out of business. And he allows me to “find myself in some serious misery”.
Mark Welch says
I have often thought that Lean is very congruent with Christianity (I can’t speak for Jews or Muslims, not being of, or having a thorough understanding of their faiths, but I would suspect the same.) Jesus’ new commandment in John 13:34 is to love one another. Yes, that’s certainly deeper than respect for people, but if we love people, we will respect them and there will be no room for greed or deception. This is one of the main reasons I’ve found healthcare much more satisfying than manufacturing – especially working in a not-for-profit hospital as I do now. No, I wouldn’t say that our staff actually loves our patients, but they certainly care deeply for them, and respect them as patients/customers, and they are very civil and respectful of each other for the most part. Sure, we aren’t perfect at it, but it’s much closer to a Christian set of values than I saw in my 12 years of manufacturing, and therefore much more satisfying for me than manufacturing ever was.
Bill Waddell says
I don’t think it is a manufacturing versus healthcare issue – after all someone had to manufacture every device, drug, fixture or tool of the healthcare trade. But I think you are right on the money concerning the nexus between respect for people and Christian teaching.
What lean provides is a set of business principles and practices that are consistent with one’s faith, and I believe that to be the case regardless of the particular brand of religion one practices. The Toyoa philosophy is deeply rooted in the Bushito Code – the Code of the Samurai and its roots in Confucianism and Buddhism – and its core virtues of loyalty, honor, courage, benevolence, honesty, respect and rectitude. And there is pretty close alignment between those principles and the New Testament, The Koran and the Talmud.
Belief in an obligation to a higher power to treat all people with respect and to, some degree, love and lean are not one and the same, but when you manage by lean principles you do not have to continually rationalize business practices that go against the grain of your ethical, moral or spiritual code.
The bottom line, to me, is that lean arose from not only a set of business practices and production techniques, but a common set of principles governing how the Toyota founders believed they should live their lives on and off the job, and I do not see how it is possible to pry the business of lean away from its underpinning social and spiritual philosophies, and have the business aspect remain intact.
Bill Waddell says
Concerning your comment:
“So I assume that you are against the free market. You would not allow a company to regulate the amount of product they sell nor the price they sell it for.”
You are making quite a leap in assuming that because I am in favor of integrity I am somehow in favor of government regulation to assure integrity. The question was should a company be honest and forthcoming with its customers, or should they try to devieve them.
I stand in favor of honesty.
Mark Welch says
Bill, I agree with you that overall it’s not an issue of manufacturing vs. health care, but my own personal experience has been that the values I’ve observed in health care align much better with my own and with my faith. I can only speak for myself. I don’t feel the tug to compromise my personal values or faith nearly as much in health care as I did in manufacturing. And, yes, someone has to make the meds, CT scanners, etc. and hopefully they aren’t having to compromise their values (assuming they’re noble) when they’re at work, either. I’d say that if they’re making great products to help people and make them with integrity, at great value, at a competitive price and with good profit, good for them! All the better! Everyone wins!
Jamie Flinchbaugh says
Not sure how I should feel since I’m as bald as they come…
And you missed the McKinsey partner who was arrested (kind of liked that one).
Anyway, I certainly agree with your sentiment here. Obviously I think that lean is about your thinking, your beliefs, your values, as I have said this many, many times. I think to build any sustainable business, that outlasts not just a period but outlasts you, it must be based on wanting to serve others. You must want people to receive more value than they end up paying for. You must want their lives or businesses to get better.
Bill Waddell says
I’m a bit follically challenged myself – I hope it means that lean saved you, Emmer and me from the wrath of God in the nick of time. I enjoy trashing McKinsey as much as the next person but I went with the IBM guy because I figured there there was little news value in reporting that a McKinsey employee was taking money while giving nothing in return.
Mark Welch says
I like your perspective, especially about serving others. I don’t have the passage at hand, but when Jesus was asked by his disciples, “Who is the greatest?” he told them, “The greatest among you is the servant of the rest.”
It’s hard to imagine what the world would be like if that kind of thinking would spread.
Anyway, I know this topic/thread isn’t intended to completely be a forum for one’s faith, but speaking for myself, the Lean philosophy fits well with mine. One day if I ever get ambitious enough I may even extract main ideas of lean and relate them to scripture, even though as Bill pointed out, the roots of the Toyota philosophy came from the Bushito Code, Confuscianism, and Buddhism. It’s not surprising to have common themes among the world’s major religions.
This has given me an idea… Do you think there is a place for a Christian Lean Thinkers group out there? :-)
Ron Holmes says
Bill, Having lived and worked abroad for 25 years I can assure you there are many, many systems of governence functioning in the world that are not democracies or even capatilist. There are lots of examples of very successful, benevolent, dictatorships, ie: Singapore…
Bill Waddell says
I suppose if you have to live under a dictator then it is best to live under a benevolent one.
I have traveled a bit myself and I have never found anyone who once lived under a dictator, but now is free, who would go back.
Freedom is something far too many Americans take for granted. You might want to travel around eastern Europe some day and see how many people whould like to go back to the old communist days, even though in countries like Hungary the economy was better under the communists. I never met a soul who would trade their freedom for a bigger paycheck.