Understanding and Dealing with Paradigms
Ironically, the only constant in the world is change … there is no escaping it. Lean and daily kaizen goals will drive change in every organization. Think back watching “Star Wars,” when Darth Vader tells Luke with a shaking fist, “Do not underestimate the power of the Dark Side.” While we lose dramatic effect when we say it, the emphasis is just as important, “Do not underestimate the power of paradigms.”
We start every training class with asking:
■ How many times have you had a great idea for improving a process?
■ How many of you had trouble implementing your new idea?
This is the concept Joel Barker explores in his video series, Business of Paradigms.1 He states: “Paradigms are sets of rules and regulations that do two things:
1. First, they establish boundaries.
2. Second, these rules and regulations then go on to tell you how to be successful by solving problems within these boundaries.”
Paradigms are good, as they help filter out unneeded data; however, they can be bad when our paradigm becomes “the” paradigm or the only way to see things. The real challenge lies in recognizing and dealing with them. We are all full of great ideas on how to improve; but all great ideas tend to meet some resistance. Many times, those great ideas come from outsiders because they are not vested in your paradigms. Do not fall victim to the Dark Side of paradigm paralysis!
Change Management
Change management is not only a large part of Lean; it is an essential part of becoming Lean. As you move from accepting new ideas and then transitioning them into reality, one should not mitigate the importance of this component to successfully disseminate, deploy, and sustain Lean. We have a saying when implementing Lean: 50% is task and 50% is people. Fifty percent is applying the Lean tools to any process, which is the scientific management part of Lean. The other 50% is what we call the people piece, or change management. There must be a balance between these two pieces. Listed below are various change tools to consider when implementing Lean systems. Keep in mind that people mainly fear changes they perceive as negative. None of us resist changes we perceive as positive. Would any of you object to the change of increasing your pay by 10%? Even if the change was made without telling you ahead of time? We would all view this increase in pay as positive. Positive changes or changes that fit our paradigms pass through our filters easily. It is only the changes we perceive as negative that generate resistance.
Change Tools
The first change tool we call the “change equation.” We review this up front with all our clients, normally starting in the assessment phase (Figure 7.1).
Figure 7.1 Change equation. (Source: Protzman, Charles. The Lean Practitioner's Field Book. Productivity Press.)
R = Resistance to Change
Notice there is a multiplication sign between each letter. This is because if any of the letters equal zero or are not addressed, we will not overcome the Rchange, which stands for resistance to change, thus effective change will not occur. In addition, each step needs to be followed in order.
C = Compelling Need to Change
We have learned Lean is generally not proposed in most companies unless there is a perceived need to change. The question to ask is, “Is there really a compelling need to change?” If we could shout this a thousand-times louder, it still would not come close to how crucial this is in making a change.
There are two ways to incentivize change:
1. One way is to have an actual crisis or business case, where without change, the organization will not survive.
2. The other way is to invent a crisis or to set very high goals (challenges or stretch targets) for the organization that cannot be achieved by doing it the way it has always been done.
Lean leaders must find a way to drive Lean improvements and implement employee ideas every day. This is called daily kaizen. We have learned if you implement one idea they will give you another. The CEO must create the compelling need to change for the organization as a whole. This means not only do we go through the change equation, but the CEO must determine a way to continuously repeat the change equation cycle to create a systemic way to drive continuous improvement every day.
V = Vision
Vision is important in the change equation because without a vision how can you chart a course? People must understand the vision and the change required to support the vision, including the how, when, and what their contribution will be as well as their role in the change. This will make the change easier to sell and become adopted, thus reducing the resistance to change. Communicate, communicate, and communicate. It is critical when you begin deploying Lean that team members communicate clearly as to why a Lean transformation is needed.
N = Next Steps
N stands for next steps. Once we know we have a compelling need to change, know, and understand the vision, we need to determine the next steps (not just the first) to get to the vision. These steps come from assessing where we are currently, relative to the vision. If the roadmap of how we are going to achieve the vision is communicated and people gain an understanding of it, this will help diminish the resistance to change.
S = Sustain
The final letter, S, stands for sustain, which we have added to the original equation. Once we have implemented our steps, we must sustain ongoing improvement. This is the most difficult step of all. Sustaining is the true test of whether there was a compelling enough reason to change, and a sign if the other letters were implemented properly. There are different parts to this equation. We must deal with the change itself, the rate of change, and the repercussions of the change. To be successful, we need to give people as much control over the change as possible. We need to over-communicate why we must change, train people in the changes, and show how the changes will help them and the organization. We need to be sensitive to the fact that change is uncomfortable for most of us, and how deploying Lean can literally turn people’s worlds upside down. No matter how hard you try, you cannot simply make other people change.
The Three-Legged Stool for Lean Implementation
This example (see Figure 7.2) illustrates how to sustain Lean. The first leg is the change equation, the second is establishing the pull for Lean, and the third developing Lean practitioner skills:
Figure 7.2 Three-legged stool for Lean implementation. (Source: Protzman, Charles. The Lean Practitioner's Field Book. Productivity Press.)
■ Everything starts with the change equation. If there is no passion for Lean and a compelling need to change, the stool will fall down.
■ The next two items require a balance. The pull for Lean and the ownership must come from and be with the top of the organization, board of director level, president, or general manager. The pull for Lean creates the need for Lean resources. However, pushing Lean on an organization normally results in much resistance. Therefore, making the Lean leader be responsible to implement Lean does not normally work very well unless it is combined with line ownership. Otherwise, everyone will just say it is the Lean leader’s job to do Lean, not them.
■ If there is a pull for Lean, then there must be Lean resources trained to meet the demand. Initially, the Lean team, which should be composed of both Lean practitioners and team members from the floor (future Lean practitioners), need to learn the Lean tools while working, over some span of time, on several projects. Six to nine months is a normal amount of time to really learn the fundamentals of the Lean tools. We are referring to a thorough grounding in the tools and exposure to the different environments for Lean implementation (i.e., assembly, machining, transactional, etc.). Once they are trained, we can create the pull for them from the line organization. Eventually, everyone in the organization should become a Lean practitioner.
The Change Acceleration Process 2
The change acceleration process (CAP) model was popularized by GE and used at AlliedSignal (now Honeywell). The model is:
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If the change you are trying to deploy is not accepted, then you will not achieve an effective result. One must understand (leverage stakeholders analysis tools) and deal with resistance from key stakeholders, build an effective influence strategy and communication plan for the change, and determine its effectiveness. Again, the relationship in the equation is multiplicative, which suggests if any of the components are zero, the change will not be effective. This process involves building a predictive model by assessing each key stakeholder’s anticipated resistance to change and building a strategy to increase their acceptance. Following a more formal-change roadmap will help ensure the success of the change. The roadmap will help by deploying and aiding risk mitigation with ongoing communication and barrier removal throughout the effort. The change acceleration process (CAP) is outlined below:
1. Creating a shared need
2. Shaping a shared vision
3. Mobilizing commitment
4. Making change last
5. Monitoring progress
6. Changing systems and structures
Rapid Improvement
Rapid Improvement = low cost + high benefit + easy to implement solutions.
Rapid improvement or quick wins should be implemented immediately, with no hesitation. Once implemented, video and share the success stories around the gemba, highlighting the employees who got it done.
“Right Seat on the Right Bus”
As you proceed on your Lean journey, paradigm shifts in thinking are required to transform the organization. You may find not everyone can, or is willing to, make the adjustments necessary to move the organization forward in this new direction. You need to assess if you have the right people in “the right seat on the right bus.”3 This concept is from the book, Good to Great,4 which we have found invaluable in our change-management toolset. The goal is to find out if your employees are on the right bus or, in other words, supporting your change initiative. Once this is established, assess if they are in the right seat on the bus (in the organization chart) to help us get to the next level of change. It is important to identify and determine the best course of action to take when encountering concrete heads. If not addressed, they may negatively impact the ability of the organization to achieve Lean success. People are a company’s most valuable resource. This is especially important to consider when implementing a culture change to Lean thinking.
Change: Are You Empowered? If So How Much? The Freedom Scale
Leading Lean initiatives requires a level of comfort with delegation. Engaging frontline staff in problem-solving and supporting them in the initiatives requires managers to be able to empower and delegate activities they may not have in the past for a variety of reasons. How do we overcome delegation challenges? It is done through empowerment. To help with this we use a tool called the empowerment or freedom scale.5 The scale is composed of the following five levels:
1. Told what to do
2. Ask what to do
3. Recommend, then take action
4. Take action, notify at once
5. Take action, notify periodically
These levels represent the comfort levels between a manager/supervisor and their direct reports or team they are championing. The scale can be utilized for individual tasks, job descriptions, and team projects.
Putting a Reward System in Place
Change is hard; the uncertainty surrounding change experienced by individuals can be very stressful and must be managed. As mentioned above, it is extremely important that attention is given to reward the participants who are impacted by a successful change effort. Thoughtful consideration must be given to the development of a recognition and reward system. Putting a reward system in place can provide incentives for participation in the current change process, and reinforce willingness for staff to participate in future change. People will work to make their job go away if there is no fear of being laid off. All reward systems have their own pros and cons. Make sure you understand these prior to implementing the system. Recognition is a powerful reward and should always first be considered in place of, or in addition to, financial rewards.
Company Suggestion Systems
The suggestion system is at the heart of the Lean culture, however most companies fail when they implement them, or don’t nearly get the full potential.
Employee suggestion systems if deployed correctly can foster a culture of daily continuous improvement, which can facilitate rapid change acceleration. In fact, this is the crux of the Lean system. To put this in perspective, the daily suggestion system at Toyota is owned by a board of directors member. In 1988,6 the Toyota suggestion rate was four suggestions per month per employee with a 96% implementation rate, resulting in 20 million ideas over a 40-year period. In comparison, the typical US company averages about one-sixth of a suggestion per month per employee. The Toyota suggestion system is not a normal type of suggestion system. There is no suggestion box that gets reviewed by management prior to implementation. The suggestions system accumulates many small ideas, some of which lead to big ideas. We then look to see if they are transferable within other areas of the company. This idea is called “Yokoten” in Japanese and is easy to understand. Can we take these ideas and:
■ Transfer them to other sites/plants another area or process
■ Further them and generate new ideas
■ Utilize them for people development and discriminator for advancement
Small ideas (especially if they are implemented by in-house personnel) are the best ideas, because other companies cannot easily copy them unless they have identical processes and equipment to yours. For example, “poka yoke” (mistake-proofing) on machines, speeds and feeds, total productive maintenance changes, etc. is difficult for someone else to copy and can create a “barrier to entry” for your competition. Keep in mind, if you can buy it from a catalogue, so can your competition.
Paying for Suggestions
Companies should not pay for suggestions. Suggestions systems are a complicated issue, there is no easy answer and this topic can be a book in itself. Toyota’s suggestion system is described in the book, 40 years, 20 Million Ideas. During this time, employees were paid small amounts for their ideas, but when they received a payment, they shared it with their co-workers; after all, without their co-workers, they could not have implemented the idea. They can then compete for monthly and yearly awards. Supervisors and managers (hereinafter referred to as management team) need to be actively engaged in helping to develop the team charter, define and clarify the scope of the Lean project, establish metrics, and provide support and guidance throughout the Lean initiative.
It has been our experience that 40%–60% of midlevel managers initially resist Lean initiatives.
Change Barriers—Impact of Barriers: Removal Degree of Difficulty
Whenever implementing change, we run into barriers. We classify these barriers as cultural, process, and technical.
We describe these below:
1. Cultural barriers result in entrenched habits, behaviors, and attitudes. They have a degree of difficulty = 100×. Cultural barriers can only be removed by the senior leadership team.
2. Process barriers (10×) are best removed by using cross-functional teams and championed by senior leadership. These are good candidates for Lean system-wide kaizen projects or in some cases point kaizen events.
3. Technical barriers (1×) are those specific to machines or the industry. Technical barriers can normally be removed by individuals or cross-functional teams.
To remove these barriers one must:
1. Identify the barrier and ask if there is a compelling need to change the barrier.
2. If there is, then categorize the type of barrier and choose the appropriate method or approach to deal with the barrier.
3. Pick and charter the appropriate team or individual to attack and remove the barrier using plan–do–study–act (PDSA).
4. Have the team map the process and identify the critical metrics. Then see if the process is at entitlement and needs a paradigm shift to a new process or standard.
Change: Threat or Opportunity?
Team members who view change as a threat, only focus on the negative, which many times results in a self-fulfilling prophecy. Those who embrace change and see it as positive not only succeed but also have fun doing it, and they tend to advance in their organizations. Some people are just naturally early adopters for change, while others wait and sit back to see what will happen.
“What’s in It for Me?”
Whether a team member sees a threat or an opportunity, it is only natural to ask the question, “What’s in it for me?” Remember, change can be a difficult adjustment for many individuals. When there is change in the wind, an uneasiness of the unknown begins as people try to understand the impact to their local areas. There’s no quicker way to negatively impact the culture than to not effectively communicate change! Whenever challenged with a new initiative, it is important to answer these questions, or else employees will feel left in the dark, creating an unnerving void. They will fill in any gaps not clearly communicated with the worst-case scenario, often creating or spreading rumors that will run rampant in the office and potentially on the internet.
1. What is the change we are making?
2. Why are we making the change?
3. How will it affect the employees? Now and in the future?
4. How will it affect the company? Now and in the future?
5. What is in it for the employee if we make the change?
6. What is in it for the company if we make the change?
Share as much of the implementation plan as possible to provide when, where, and how the change will be implemented. People feel much more secure knowing there is a plan in place and that they have a future role in the company.
This tool forces leadership to think through each of these questions. The answers must be compelling enough to support the big “C” in the change equation. We suggest scripting answers to the above questions prior to starting the Lean journey (see Figure 7.3). Once scripted, it is important to communicate the answers with the staff in each department prior to rolling out the Lean implementation. The biggest concerns people will have are: “What is in it for us,” and “How will it affect us?”
Figure 7.3 Scripting example for change questions. (Source: Protzman, Charles. The Lean Practitioner's Field Book. Productivity Press.)
Sacred Cows
All organization have “sacred cows.”7 As an organization begins to implement change, they often encounter the largest and most difficult of the cultural barriers; this is referred to as the sacred cow. Sacred cows are outmoded, generally invisible, beliefs, assumptions, practices, systems, or strategies that inhibit change. These barriers are ineffective, and prevent responsiveness to new opportunities. If not recognized and addressed, the transition to a Lean organization may be challenging. They tend to be embedded in the organization and are systemic. They can only be removed at a very high, and sometimes by the highest, level of the organization.
We find in our practice that once these barriers are eliminated, there is a major positive upswing in culture among employees. The reason that it must come from a high level in the organization is because of certain peoples’ beliefs; they become emotionally tied to this barrier, and may have spent many years defending it based on those beliefs. It is important to take this into consideration, as you want this removal to be a positive win for everybody.
Overcoming “Big Company Disease”
Most batch-based organizations are designed in functional silos where executive leadership is located far from the manufacturing floor, with most their time spent in meetings. The leaders have no time left to walk the floor (gemba) to see what is occurring firsthand. Over time companies fall victim to firefighting where the executive team spends most their time firefighting versus growing the business. In today’s literature, this is referred to as “big company disease”.
Lean processes can be applied anywhere. Any process can be improved by applying Lean. We have had companies and hospitals that, over the first five years, literally saved millions of dollars, avoided hiring significantly more labor, combined and freed up significant space, and avoided major construction projects. Notice that we quantified these results over the first five years. Many times, companies don’t see huge bottom-line improvements immediately, as it takes time to embed Lean throughout the overall system: however, some projects can quickly result in large gains.
Implementing Lean requires a counterintuitive paradigm shift in thinking to offset the ever-prevalent resistance to change from the current system. This requires an ongoing shifting of attitudes during the transition from the old batch business model. This includes the need to adopt new accounting techniques and instituting significant structural organizational changes. In short, developing a new way of thinking.
A consistent theme throughout this book, as mentioned earlier, is the balance required between philosophy and tools. As such, about 50% is based on Lean tools, system thinking, and practical application, while the other 50% is associated with learning proper problem-solving techniques.
Bumps in the Road
We all fall victim to this tendency, as we tend to get caught up in the excitement of implementing and making things better. When we find out we have inadvertently upset someone (especially at the executive level) we need to take a step back, and take a breath. No matter how big a deal it seems initially, it too shall pass. Once the problem is smoothed over, we need to understand how and why we upset someone, to try and avoid it as best as possible in the future. Instead of concentrating on these issues with a negative perspective, we need to step back and look at these occurrences as just bumps in the road. People that appear negative, skeptics, are not always against you. This is referred to as a rational resistance to change. Once their objections are answered, they can easily be brought on board with the changes. We must patiently solicit and overcome every objection and take away every excuse to get people to buy in to the change. This can be a very painstaking process but with perseverance it will pay off in the long run.
Succession Planning
Every company needs to be prepared, in the event someone leaves, or is unable to continue on in the position assigned. In addition, there is a major “brain drain” going on in our country, where once someone leaves, all of their knowledge follows them out the door. With the amount of turnover and attrition in our society, we find many organizations do not have any succession plans in place.
As leaders, part of our duty should be to develop our people to be able to take our place (see Figure 7.4), as well as develop plans to share the knowledge throughout the organization. If there is no one there to take our place, then it is much more difficult for us to advance, since there is no one to replace us. Therefore, it is in our own best interest to ensure we are constantly developing a successor(s).
Figure 7.4 Leadership assessment summary. (Source: BIG Archive—AlliedSignal TQ training materials.)
Notes
1. Video—Business of Paradigms, Joel Barker.
2. http://bvonderlinn.wordpress.com/2009/01/25/overview-of-ges-change-acceleration-process-cap/. In 1989–1990, under the direction of Jack Welch.
3. Collins, Jim. Good to Great (New York: Harper Business Press), 2001.
4. Collins, Jim. Good to Great (New York: Harper Business Press), 2001.
5. Coopers and Lybrand. AlliedSignal TQ Training Course 1994.
6. Yasuda, Yuzo. 40 Years, 20 Million Ideas: The Toyota Suggestion System (NewYork: Productivity Press), 1990.
7. Kriegel, Robert. Sacred Cows Make the Best Burgers (New York: Warne), 1997.