A frequently used quote when talking of change management is one attributed to Albert Einstein:
“The definition of insanity is repeating the same behaviours over and over again and expecting a different outcome.”
While it is debated whether or not Einstein really made this statement, which is often re-quoted in different forms of paraphrase, it is certainly a truism that if individuals, teams or organisations continue to operate in the same way that got them to their currently undesired situation, then a change in behaviours and approach is needed to deliver different (and better) results.
Unfortunately, the leaders of an organisation often become trapped in what I call the ‘Leadership Performance Trap’ and are bereft of, or afraid to try, new ideas. The result seems like a stubborn persistence in a particular strategy, despite its seemingly obvious failure to deliver the performance improvement they desire.
It must be overcome if an organisation is to prosper and attain excellence. All too often, leaders continue with an approach that consistently fails because they’re unable to consider, or attempt, alternatives. This drives a cycle of poor performance:
- The business’s performance is below par…
- Improvement programmes are instigated to address the issues and improve performance…
- The programmes fail or are only partially successful…
- The leadership initiate more programmes similar to the first to “catch up”…
- Repeat until a) bankrupt or b) acquired.
What you’ll see in these organisations are symptoms such as:
- Multiple initiatives, with so many priorities that there are no priorities
- Overloaded staff, unable to keep up with the workload being placed on them
- Continual reorganisations, with lay-offs a normal part of the annual cycle
- A large transformation function and ubiquitous consultants
- Ever-changing and misaligned priorities, with different functions and areas of the business having seemingly different objectives.
The root causes of these symptoms may differ from organisation to organisation, but common ones that I observe are:
Leadership impatience – failure to allow change and the impacts of a programme to come to fruition, ignoring Kotter’s change leadership guidance.
A deficit of problem-solving ability – not understanding the root causes of the organisation’s poor performance.
Inadequate Hoshin Kanri – unstructured breakthrough improvement planning.
Poor daily management – management attention is spent mostly firefighting daily operations.
The types of initiatives within the organisation’s improvement programmes will also be very obviously those of a perennial poor performer. There will be very little focus on waste reduction and value stream improvement and a big focus on wage arbitrage, head count reduction and large-scale IT solutions.
A Lean way out of the cycle
The antidote to this is Lean thinking and I use LEAN as an acronym to explain the approach:
LEAN = Leadership, Excellence, Analysis and No.
This is not just for those people with the job title, but the enabling of everyone in the organisation to take leadership in their own domain. By setting the appropriate boundary conditions, taking a people-focused approach to our business processes and ensuring that everyone is focused on what the customer values, we use daily management to assure continuous flow (of products, information, knowledge and services) throughout the value stream.
The pursuit of excellence is absolutely core to Lean thinking and its continuous pursuit is enabled through some of the key tenets of a Lean business system. Utilising small batch sizes, continuous flow, built-in-quality and pull systems (not only for products but also information, knowledge and services), based upon the customer demand, daily management drives rapid problem-solving and Kaizen. Team members are encouraged to constantly experiment with improvements to the system and through go-to-Gemba (go to where the value is added) leaders are able to coach and act as teachers.
Lean thinking has its foundation built on fact-based decision making, through the application of A3 thinking and a short-interval control approach. People are involved in rapid problem-solving to find the root cause and implement countermeasures. However, experimentation and learning are major elements. Therefore ‘at-the-Gemba’ problem solving, with ‘cardboard engineering’ experimentation, is common and this approach is not just for the shop-floor, but is applicable all the way to the boardroom.
In my experience, the ‘secret formula’ of Lean thinking is Hoshin Kanri (or policy deployment) and is the one area that most organisations struggle to apply. That means having the courage to say ‘No’ to the multitude of opportunities that an organisation has and to have the laser-like focus required to choose only those few things that will truly provide break-through results. It is extremely difficult and only a few organisations have the level of discipline and stamina required truly to do this. Without this ability to say no, most businesses tend to overload their people and fail to execute effectively.
Those organisations that have embedded Lean thinking into their company culture have demonstrated superior performance over significant periods of time and prove that Lean is, above everything, about integrating a principle-driven approach to an organisation’s management philosophy.
It is therefore crucial that leaders avoid the performance trap and show the courage, and foresight, to change their approach if they are to achieve a different, improved outcome.
About the Author:
Philip Holt is currently Head of Operational Excellence, Accounting Operations at Philips, where he has built up a significant reputation on Lean practices and was responsible for the development of the Philips Lean Excellence Model. By combining Japanese methods with European and American business processes, he has a keen eye for the waste within organisations and the opportunities for cultural change through employee engagement.
His book, Leading with Lean is available to buy globally.