Implementing Lean | the “and OE” Problem (the “and Lean” Problem)

In order to give us a background for this problem when implementing lean (or operational excellence in our case), I offer the following story, which formed my thinking on this issue.  For more background on our assessment of the condition of “Lean” in North America, check out this post.   In 2003, one of our regional health care product manufacturers won the coveted Malcolm Baldrige National Quality Award. It was the second time the company had been visited by the audit team. The first time was several years earlier. The first time, the audit team provided a detailed report that outlined many areas for improvement.

Then President, John Friel, examined the report and concurred with many of the recommendations. After making so many changes prior to the audit, Friel was looking for “what they had missed.” His conclusion was simple and elegant and provided the rallying point the company needed.

Friel realized that the company’s biggest failure was doing business as usual “and Baldrige.”

For the next few years, Friel and his leadership team strived to replace everything they had been doing with a system based on the Baldrige framework. A short time later, President Bush shook Mr. Friel’s hand as he honored him with the award.

First, please don’t think that I am equivocating any award with the Operational Excellence System. Awards are an evaluation against some best practices and, while I admire those who win them, I often wonder whether the changes will sustain over the very long term.

Implementing Lean | Successes and Failures

I shared this story because it allowed me to think clearly about the successes and failures I have seen as I coach leaders to implement Operational Excellence or to implement what they are calling lean. In cases where the organization has succeeded in implementing lean, and where the change is deep and substantial, I’ve watched the top level leader completely replace his or her business operating system (the way they manage, lead, and operate their particular business functions) with Operational Excellence. Where I’ve seen organizations fail at implementing lean, I’ve noted that the top level leader resisted this “total replacement.” In both cases, the size of the organization or business unit did not matter: if the top level leader did not demand total replacement the result was limited success.

Implementing Lean (or Operational Excellence) | the “And OE” problem

The KCOE calls this phenomenon the “And OE” error: organizational leaders try to keep their previous operating and human conventions AND DO OPERATIONAL EXCELLENCE. We see it early and often, especially with organizations who have already begun implementing lean or ones that are thinking about implementing lean. We use the principle to evaluate prospective clients. Now we’ve decided to pose this phenomenon for your consideration and thought.

We acknowledge that a top level leader is just a human like any of us. But, we also acknowledge that most of us went through a conversion in our mindsets that stimulated and cemented the world class values in us. The result is that our mindsets and actions generally follow those values now. Many of us have allowed these values to drive our behavior outside of the workplace. We all know the results that Operational Excellence, the way we have designed the System and its implementation leads to better work and life results.

Here is a Point of Recognition: when implementing an Operational Excellence System based on the KCOE  System, some top level leaders resist replacing their operating system with Operational Excellence.

Implementing Lean (Operational Excellence) | Solving the Problem

We will be hosting an invite-only symposium in 2011 that will attempt to develop a range of solutions for this problem found when implementing lean. Our challenge during this KCOE System Symposium will be to analyze this problem, find the root cause or causes, develop some planned solutions and a plan for testing them, and finally develop a checking method to see if our planned solutions work.

The benefit of addressing this phenomenon is far-reaching. Regardless of where you are in the organization, leaders will resist change. If we allow ourselves to imagine the implementation as a process flowing value to the organization on both the human and operational sides then the “And OE…” mindset interrupts the flow.

Implementing Lean | More Information

If you are interested in the Symposium, leave us a comment or two on the problem as you see it. Implementing Lean (or in our case, Operational Excellence: the System Required for Lean to Work) is a worthy goal and vision, but is incredibly difficult to attain.