Why Do Most Companies Fail When They Strive to Become More Efficient and Resilient?

At the beginning of this month, Brian Strobel published an intriguing new book entitled Pursuing Excellence: A Values-Based, Systems Approach to Help Companies Become More Resilient, which interestingly posits that a company doesn’t implement Operational Excellence as a methodology, model, or tool. Instead, a company realizes Operational Excellence. It does so by integrating effective leadership, teamwork, problem-solving, systems thinking, and continuous improvement. It achieves this by aligning strategies, empowering employees, optimizing business processes, and improving the customer experience.

When I spoke with Brian recently, I asked him: “Why do most companies fail when they strive to become more efficient and resilient?” Here is his full answer:

I think the fact that people are starting to ask questions like this proves there’s a growing recognition our previous ways of doing things aren’t working.

The way that we’ve managed our companies has remained largely unchanged since the 18^th century. Since then, different philosophies have come and gone, but the central ideas for what it takes to manage our companies have remained fairly consistent.

And our approach to achieve continuous improvement must also change.

I believe that our legacy approaches to continuous improvement, to include Lean and Six Sigma, are failing to consider the whole system and account for the leadership principles necessary for success. These previous methods placed too much emphasis on the specific improvement methodology, without proper consideration for the entire system and surrounding culture, systems and structures, values and beliefs, and the particulars of our marketspace..

As I write in my latest book Pursuing Excellence, “our companies are struggling with ways to become more competitive, to reduce costs, and the chase unobtanium in their never-ending pursuit to do more with less. But to survive, this focus on efficiency must not come at the expense of innovation, agility, and moving fast."

The world is now a new place, with new rules. Succeeding will require new ways of looking at our problems. And the lens of operational excellence can help us view these things from a different perspective.

A lens is something that bends and refracts light to alter our vision. It allows us to see things differently. The right kind of lens takes what’s already there, and through convergence and divergence, provides a different perspective to view the subject. It focuses our vision on those things we need to see with more clarity.

These ideas that make up the lens of operational excellence, as shown here, provide us the context for what must be considered as we move towards driving change with a fundamental understanding that we must have everyone aware of why we need to change. In this regard, the lens helps guide the vision for our companies to become more resilient and move closer to achieving excellence.

What do you think of Brian's thoughts? How have continuous-improvement initiatives affected your company? 

Implementing Change through Projects -- What are the Common Mistakes?

An impressive new book by Jeremy Nicholls, entitled The Everyday Project Manager: A Primer for Learning the Principles of Successful Project Management, explores the key attributes and skills of successful project management and describes the practical skills that will enhance project delivery regardless of your level of experience. In addition, Jeremy posits that success and survival in business relies on change and the way that business implements change is through projects.

At the beginning of the month, I spoke to Jeremy about his book and asked him: "What are the common mistakes made when trying to implement change through projects?" Here is his full answer:

Understanding the Context for Change

In the enthusiasm to get going and DO SOMETHING, organizations frequently fail to set a project within the wider business and strategic context.  Change via projects is easiest to implement, and more effective when it aligns with the overall background of change.  By considering the broader organizational goals and – importantly – how your project aligns to those goals, you will be better able to articulate the drivers for change.  This increases buy-in and significantly improves your change implementation.  When you think about it, this applies to personal projects too – your project to decorate the bedroom might be a great idea, but if your partner’s plan is to sell the house next year, they won’t support your change.

Identifying Champions

For change to be implemented most effectively, you require support up and down the organization. It seems to be stating the obvious to say that the more people who are championing your project, the more likely it is to succeed, but it is frequently overlooked. When people deliver projects, they tend to get very caught up in the nuts and bolts of the delivery itself.  It’s a different skill set, but one that the best project managers have, to get out there and engage with stakeholders and bring people along for the journey.  Your project sponsor is the key here; if they are not excited about the project outcome then there’s no reason anyone else should be.  But the main point is don’t just be a project manager – be a project cheerleader!

Get the Basics Right

There will be certain points during a change project where things get exciting.  This can be for a good, expected reason (the much-anticipated go-live), or a not-so-good, unexpected reason (an issue that threatens to derail the project).  In either case, when the temperature of the project gets to fever pitch, the first things to get side-lined are often the good (but not quite as exciting) practices that keep a project on track.  Stay focused on the objectives; remember the reasons for doing the project in the first place.  Avoid the tendency, to throw the baby out with the bathwater when the project hits a bump.  Go back to first principles, take a breath, and keep going.

What are your thoughts on Jeremy's perspective? Has your company been successful implementing change through projects? What attributes do you think compose a successful project manager?

Developing Your Employees While Achieving Business Results -- Is it Possible?

Just this month, Lisa J. Koss published an engaging book entitled Leading for Learning: How Managers Can Get Business Results through Developmental Coaching and Inspire Deep Employee Commitment, which addresses a universal problem for many managers -- With so much "real work" to do every day, how can they also carve out time to learn, engage, build relationships, tap motivation, encourage development, and inspire?

When I spoke with Lisa a few weeks ago, I asked her: "What causes the barriers that block the concurrent development of employees and business results?" Here is her complete answer:

I personally don’t know of any manager who doesn’t want to get results – both in business and in leading others.  Managers care about both.  No one wants to feel unsuccessful in either realm.  Making a difference is the stuff of positive self-regard and feelings of self-worth, whether regarding the work product itself, or developing more capable leaders. 

What gets in the way of people managers doing both -- getting business results while developing people?  In my view, with 25 years in the field of leadership development, there are numerous reasons.  Here are three: 

First, people managers often don’t want to be.  Often promoted for their technical or business acumen, people managers often know little about people management.  They think they can gain status but ultimately stay committed to getting their own work done, emphasizing management of the business versus leading people.  Despite accepting a position with the word “people” embedded, most managers I’ve known don’t seem to contemplate the implications.  “People management” simply becomes another task, or set of problems to solve, instead of considering the role as an entirely different way to impact the business.  Consider, for example, that workplaces are actually schools… for everyone.  People managers have the great opportunity -- and responsibility -- to support others to stay relevant, to innovate, and to maximize their potential.  Whether the manager’s people learn slowly or quickly will depend, in large part, on the manager’s orientation to her role. 

Second, some people managers assume that spending time to develop others really doesn’t pay off.  The research in the social sciences say otherwise.  What’s lost in the discussion is the focus on what really matters – engagement.  Engagement is important because it can be measured with the phenomenon called “discretionary effort”.  Discretionary effort is the 15-25% more effort that employees (including you) devote to their work when feeling engaged.  These gifts to the workplace often come in difficult-to-quantify packages – like arriving to work 10 minutes earlier, reviewing one’s work again, or taking the time to recognize a colleague – but constitute a substantial increase of value and productivity in the business. 

Finally, people managers might think achieving business results and people development are incompatible has nothing to do with mindset but relates to skills.  Humans are messy…and results can be hard to measure.  The thought of “developing others” can evoke unpleasant thoughts such as:  risk-taking, the lowering of standards, or wading into unpredictable, emotional conversations. Managers can, however, can learn the skills which release these kinds of anxieties. 

When life gets overly busy and complex, embracing a more holistic approach to leadership may seem counterintuitive.  Instead of managers thinking “either-or,” people managers can do both at the same time and experience double the success.

What do you think of Lisa's perspective? Are these the types of problems and mindsets held by many mangers in your organization? Lisa clearly and directly addresses these issues in her new book. 

Strategic Planning -- Why Does it Often Fail?

In August, Sean Ryan published his first book entitled Get in Gear: The Seven Gears that Drive Strategy to Results, which helps business leaders convert business strategy to measurable results. When I spoke with Sean this month, I asked him: “Why do organizations rarely get it right when it comes to achieving the expected results from their strategic planning?” Here is his complete answer:

It’s well documented that 75% to 90% of organizations fall short of achieving the results they expect from their strategies. Sometimes, it really is just a matter of a bad strategy regardless of how well it’s executed. Maybe it’s a bad acquisition. Maybe it’s a poorly thought out effort into new markets or with new products or services. Maybe it’s New Coke! Most of the time, though, it’s a matter of a good plan poorly executed. Execution failures often occur because: 

• the organization doesn’t have the right people in the right roles with the right capabilities to execute, or
• the organization’s architecture (systems, structures, processes, and culture) isn’t aligned to the strategy, or
• the daily efforts of their team members are disconnected from the strategy. 

In Get in Gear: The Seven Gears that Drive Strategy to Results, we outline some of the failure points and how organization’s can better align the seven gears to the results that matter. 

Here’s a really common one: We ask people to outline their top five goals. Then, we ask their leaders to outline what they think the top five goals are. On average, only two out of five match. That means that 60% of the time people are working on the wrong priorities. It’s hard to achieve great results when people are working on the wrong stuff! 

You don’t have to fix all seven gears at once. You can pick the one or two that create the most friction and fix them. You’ll likely get at least somewhat better results. Then, you can work on another to get even better results. 

Over time, individuals and organizations can bring all the gears into much better alignment and achieve dramatically better results for both themselves and the broader organization.

What is your experience with strategic planning? What do you think of Sean's take on the failure points and how to rectify them?

Lean in High-Mix Low-Volume (HMLV) Manufacturing -- Does it Work?

Lean thinking and methodology have resulted in many organizations instituting powerful initiatives and gaining major improvements, but most still associate Lean principles with low-mix high-volume (LMHV) manufacturers. There are, however, a gamut of high-mix low-volume (HMLV) manufacturers that wonder if the power of Lean is really applicable to them given their very different factors regarding volume, variety, and scheduling.

I recently spoke with Shahrukh Irani – who actually just published a book entitled Job Shop Lean:  An Industrial Engineering Approach to Implementing Lean in High-Mix Low-Volume Production Systems – and asked him the very specific question: “How is Lean applicable in High-Mix Low-Volume (HMLV) manufacturing?” Here is his detailed answer: 

Of all high-mix low-volume (HMLV) manufacturers, a job shop has the most complex production system.  The classification of different production systems that is shown in Figure 1 provides the simplest evidence that forcing a job shop to adopt a production system and tools that were designed to improve a repetitive assembly line’s performance is like fitting a square peg into a round hole. 

Figure 1: Comparison of an Assembly Plant and a Custom Fabrication Job Shop

Currently, nearly every job shop has failed to realize the full gains from Lean because they have stopped at implementing only the Lean tools listed in the left-hand column of Table 1.  In contrast, the Lean tools in the right-hand column of Table 1 are ineffective, often inapplicable, in any job shop.  So how does any Lean job shop reap additional benefits from Lean?  By implementing a new “Job Shop Lean Toolbox” in which the Lean tools in the right-hand column of Table 1 have been replaced with other tools that were developed for job shops!  

Table 1: A New “Job Shop Lean Toolbox” for High-Mix Low-Volume Manufacturers

Lean tools that will work in job shops also	Lean Tools that will not work in job shops
Strategic Planning	Pencil-and-Paper Problem Solving
Top-Down Leadership	Value Stream Mapping
Gemba Walks by Managers	Assembly Line Balancing
Employee Engagement	One-Piece Flow Cells
Workplace Design with 6S	Product-specific Kanbans
TPM (Total Productive Maintenance)	FIFO Sequencing of Orders
Setup Reduction (SMED)	Pacemaker Scheduling
Error-Proofing (Poka-Yoke)	Inventory Supermarkets
Quality At Source	Work Order Release based on Pitch
Visual Workplace	Production based on Level Loading
Product and Process Standardization	Mixed Model Production with Takt Time
Right-sized Flexible Machines	Right-sized Inflexible Machines
Standard Work	Pull-based Production Scheduling
Continuous Problem-Solving	Manual Scheduling with Whiteboards

 

If the Tool Works for High-Mix Low-Volume, Then Job Shop Lean Uses It!

In Table 1, the tools in the left-hand column will also work in HMLV production systems.  “Top-down Leadership” and “Employee Involvement” are essential.  “Standard Work Instructions” and “Setup Reduction” are needed to minimize variation in setup times on any machine (or manufacturing cell) due to different parts having varying setup sequences, tooling packages, material sizes, tolerances, etc.  “Quality at Source” empowers employees to reduce costs, take pride in their workmanship and have ownership for their work.   “Right-sized Machines” appears in both columns of Table 1 because simple machines are easy to learn to use, setup, operate and maintain.    

If the Tool Does Not Work for High-Mix Low-Volume, Then Job Shop Lean Replaces It!

In Table 1, the tools in the right-hand column will almost never work in HMLV production systems because those tools are simply not applicable to MTO (Make-To-Order) HMLV production systems that do not operate like assembly lines.  It is these tools that have been replaced by a more effective set of tools, often enabled by software, to successfully implement Job Shop Lean.

What do you think of Shahrukh's observations? What are the experiences of those who work in a HMLV environment and have been part of a Lean initiative?

Becoming a New Supervisor -- What are the Challenges?

During May, Hugh Alley published a book that introduces the central skills that any supervisor must master with, at least, a basic working competency: instructing, leading, and making improvements in their own area. It is entitled Becoming the Supervisor
Achieving Your Company's Mission and Building Your Team, and it presents some of the more widely used tools that a new supervisor may need. More importantly, it ties these tools and skills to solving particular problems.

I spoke with Hugh this month and asked him: “What are the common mistakes many new supervisors make?” Here is his complete response:

I’d say that there are three common mistakes among new supervisors.

First, they are not clear enough with their employees when they assign work. They’ll describe what need to be done, but they’ll skip over the details of how the work is to be done. These details are what set the orders apart, and they are where the mistakes happen. You need to go over them with your employee. And you need a conversation about how long the work will take. When that happens, both supervisor and worker can agree, and the supervisor’s stress goes down.

Second, they act without thinking through a situation when something is amiss. Usually that’s because they don’t have a structured way to approach this sort of problem. In the book, Julie, the GM, introduces Trevor, the young supervisor to the Job Relations approach, which gives a nice structured way to think about any situation. I’ve seen team leads charging across the floor to “deal with” someone stop in their tracks and reconsider when they remember the steps of the Job Relations program. It’s very powerful.

Third, they don’t pay enough attention to standard work. They don’t make sure that people are using the best way to do a job that the organization currently knows. That consistency will typically increase productivity by 10%. The best route to that is a good job breakdown, and the concepts of the Job Instruction module from Training Within Industry are very helpful here. In the book, Trevor learns how to do this, and it solves several problems. I’ve seen it reduce the time to get new staff up to speed from three months down to one month.

If new supervisors can get those three skills nailed, they’ll be much better off. From there, they can learn all the other skills. 

What is the quality of the leadership training within your organization? Do you agree with Hugh's assessment of common mistakes by new supervisors? Has your company experienced the benefits of a training within industry (TWI) program?

The "Blendification" of Your Organization's Culture, Strategy, and Execution

Early in June, Dan Bruder published an exciting new book entitled, The Blendification System: Activating Potential by Connecting Culture, Strategy, and Execution. By focusing on the unifying purpose within each organization, this book promotes alignment between leadership and employees setting a clear, strong foundation in which every individual can thrive.

During a recent conversation with Dan, I asked him a series of questions about the book and the connection between employees, customers, and communities. Here are the important questions followed by Dan's answers:

“What is the connection between culture, strategy, and execution and why are most companies not embracing it?”

Companies are at the forefront of fostering growth within society and communities. In the US, adults spend over 50% of their waking time in work- or work-related activities.  Work is where people come together on a regular basis with the primary purpose of identifying and satisfying society’s needs.  For companies to realize their potential, they must break away from the model of oversimplification and internal silos. Human beings can accomplish tremendous outcomes when motivated, challenged, and connected.  Unfortunately, business has diminished employee motivation by relegating people to functional silos and meaningless task-oriented behaviors.

"Why aren’t companies embracing the connection between culture, strategy, and execution?"

There are three primary components that are critical for organizations to realize their potential.  They are culture, strategy, and execution.  Historically, there has been little intentionality around designing an exceptional culture while strategy has been something the executive elite do every year or two and it typically is not cascaded through the organization.  Similarly, execution has not been embedded in the culture or aligned with the strategy and employees do not see how their jobs make a difference. Generally, there has been little focus on deliberately designing culture, strategy, and execution as a connected system where each complement and complete the other.  This is primarily related to executive leaders and founders not fully grasping the potential of a united team and their ability to truly make a difference.  Essentially, it is easier to pursue profit than potential.

"Why should companies embrace the connection between culture, strategy, and execution?"

Culture, strategy, and execution are seamlessly designed and implemented together in The Blendification® System.   When these three business components are purposefully created and connected, companies experience substantial growth in engagement, innovation, and outcomes.  As the entire company aligns on a common cultural cause, the strategic platform becomes the path for employees to realize their human potential.  Finally, the execution of the strategic platform enables employees to align their work with making a positive impact on their communities.  Thus, the systematic blending of culture, strategy, and execution enables companies to be at the forefront of advancing society through their employees, customers, and communities.

What do you think of Dan's ideas? Does your company suffer from disconnects among the culture, strategy, and execution platform? 

Can Lean and Agile Techniques Be Applied to Sales?

In April, I had the opportunity to speak with Brad Jeavons shortly before the publication of his new book, Agile Sales: Delivering Customer Journeys of Value and Delight. Brad's book is the first to address incorporating enterprise excellence (Agile/Lean) into sales. Organizational excellence journeys have not included sales teams up until now. Brad's book provides a proven step-by-step approach for integrating Agile/Lean practices into sales to amplify customer experience and sales-team performance. The book contains many case examples from companies achieving amazing results from integrating agile into their sales teams.

During our conversation, I asked Brad what results have been achieved by applying Agile/Lean techniques for sales. Here is his response:

The best example I have seen is a retailer rocketing from 0% sales growth year on year to a growth of 70% year on year. I have seen sales teams in a highly commoditized market elevate their approach and bring value back into their dealings with customers. They went from 2% growth year on year to over 15% year on year with a 10% elevation in gross margin. The results are amazing and speak for themselves. My book Agile Sales provides good detail to help an organization bring agile into their sales team and optimize their results.

In addition, I followed up with: Why does Agile/Lean work well in sales teams similarly to operational teams? 

Agile and Lean philosophies share many common beliefs, tools and techniques. They both help people to collaborate, innovate, and amplify performance. The role that people are working in does not matter; people are people in operations as they are in sales. The Agile and Lean approaches to excellence are proven to help in sales as much as operations. Agile lends itself to sales as it evolved through major global technology organizations adopting more office-based practices. I made this connection several years ago after initially learning and applying Lean practices. I moved into an executive role within the organization I was working and started to work with my sales leaders and team members to apply Agile/Lean techniques. The results we saw were amazing. I genuinely believe that Agile can help a sales team optimize their results.

Throughout the book, I give this evidence -- analyzing many successful organizations that have applied Agile/Lean techniques to their sales teams and customer engagement approaches. I describe how all levels of an organisation can sustain their energy and effort on their key customers, how they can focus on what is most important and establish a culture of continuous improvement, innovation, and ultimately, performance.  Agile Sales provides many practical examples of how agile concepts have amplified customer experience and sales team performance. I have worked to make it easy for the reader to take the learnings and apply them to their organization.

The current environment requires us to think differently and pivot for future success. Agile Sales is a must-read for anyone directly involved in or leading sales teams. It provides ideas to help sales teams get back in the game, deliver greater value and delight and amplify performance and results.

Sales improvements will help organizations survive and thrive for the future, which may prove more vital than purely operational improvements.

What do you think of Brad's perspective? Have your sales teams applied any Agile or Lean techniques? What have the results been? 

Why is Lean Needed in Higher Education?

A few days before William Balzer published the second edition of his groundbreaking book Lean Higher Education: Increasing the Value and Performance of University Processes, I had a chat with him about the successful applications of Lean concepts at major universities. During the conversation, I asked him directly: "Why is Lean needed in higher education?” Here is his complete answer:

Lean provides a proven problem-solving framework to address challenges in any organization or business sector, and higher education is no exception. Universities must be more responsive, efficient, and effective to address the growing number of external challenges disrupting higher education including: 

• Eroding financial support from the government coupled with freezes or caps on cost increases.

• Rising costs at universities to maintain their educational mission coupled to the growing price sensitivity of students and families worried about the long-term burden of student loan debt.

• Attracting and retaining the best faculty and staff in a labor-intensive operations where we have not resolved how equitable compensation increases can be offset with gains in productivity.

• Greater competition such as online universities and free Massively Open Online Courses that compete for a shrinking demographic of college-aged students and employers who question whether a college education is really the best preparation. 

As we speak, COVID-19 is already sending shock waves through the higher education community.

The application of Lean to improve processes in higher education, grounded in the principles of continuous improvement and respect for people, offers a way forward, as documented in my book by 16 exemplar universities from around the world that are using Lean. When correctly implemented, practiced, and sustained, Lean Higher Education (LHE) will meet – and even exceed – the expectations of those served by these processes, engage and develop university faculty and staff who deliver critical academic and support processes (including teaching, curriculum development, and research), and enhance the efficiency and effectiveness of the university through cost avoidance, cost reduction, and greater revenue generation. 

The potential of LHE is great at any university regardless of mission, size, and resources; in the 10 years since the publication of the first edition of Lean Higher Education, LHE has demonstrated that it can help universities reinvent themselves to earn or grow their reputations as preeminent institutions that should be valued and supported. 

Are any readers affiliated with universities or colleges that have implemented some type of Lean initiative?  Have you experienced the benefits that William Balzer described?