Three reasons why Lean transformations fail

July 24, 2018

Prioritising the wrong "P"

A real lean transformation focuses on People, Process and Profit in the order listed. A considerable amount of effort must be put on building the People -- a culture that will focus on building great processes. The eventual outcome of a great process is profit.

Companies miss this priority and jump right away into building processes when the people are not ready. It is like buying a great car and giving it to someone before they learn to drive. You know what the outcome will be when that person drives the car.

Build people who will in turn build great processes which will lead to profit

 

Looking lean rather than being lean

You have decided to embark on a lean journey. What is the first thing you do? Hire a consultant. You need a consultant who can be your coach but cannot blindly follow what they say. In most cases the consultant will come and ask you to do a series of activities. You factory will be full of posters about 5S (sounds familiar?)

The 5S vigilantes will be on the lookout for offenders. Boy!!! if they find someone misplacing a stapler from its intended position. All hell breaks loose. In all of this, the purpose of 5S gets lost and with it the purpose of lean.

In many places, there is a lack of clear purpose before some change is implemented. This breeds bad blood and leads to an eventual failure of Lean implementation. The organisation must evaluate each change for impact on business and establish a clear purpose for each of the change that they are implementing.

Change for the sake of change without purpose is also a waste. For example, most of the information these days are in your computers. A huge amount of time is spent on find information, and the server is full of crap. A good place to implement 5S would be this. However, I have seen companies spend resources marking spot for items that are never used or will never move (Yes! In one company I saw tape around a conference room table that was firmly attached to the floor. If the company is worried that someone might move the table and they would not be able to find, they have bigger problems than 5S)

You would be achieving nothing by implementing 5S on where to keep a stapler when that is not used at all. You get a better result if the 5S is implemented for the way files are stored in a server for everyone to access information instantly. "Looking lean" is marking a spot for your massive conference table or a stapler that you rarely use whereas "Being lean" is organising and standardising network folders in your server that you use everyday. The second has a business impact whereas the first is just a show piece.

Implement changes with a purpose. Change without purpose is a waste too

 

Confusing 'Means' with the 'End'

Lean is the 'means' to achieving the 'End'—creating value for the customer. You customer is not going to pay you more because you are a lean organisation. They pay only when they get the value. If all your Lean implementation does not create any value to your customer, then it is all a waste.

In many places, I have seen companies taking great pride in implementing lean but forget that it is a means to an end that results with customer satisfaction. The focus is more on how many kaizen competitions that they win or CII awards they win. Other companies set a goal of how many Black Belts they will have by the year end or number of kaizens that they will implement. This confusion between 'means' and 'end' eventually leads to the realisation that lean has not benefited the company. The management then drops Lean and looks out for the next silver bullet -- AI, IOT, Industry 4.0, BI, and finally BS (ok… this is my addition)

Lean is the 'means' to achieve the 'end' -- creating value for the customer. Lean is not the 'end' itself


 

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