Designing Effective Lean Transformations

Dan Jones & René Aernoudts
November 2, 2010
Designing Effective Lean Transformations

1. Introduction
2. Why ‘Designing Effective Lean Transformations’ is an issue
3. Root causes… and Countermeasures
4. Key advice
Agenda

Lean Global Network
 Global Mission: ‘to be the leading educators for society in
maximizing value and minimizing waste. To accomplish this
goal, we develop, advance and implement lean principles,
tools, and techniques as a system designed to enable positive
change’.
 Affiliates support lean transformations by developing lean
practitioners and leaders through education, coaching,
support, action research, events and learning materials.
 Founded in 1997 by Dr. Jim Womack & Prof. Dan Jones –
authors of leading literature on Lean: “The Machine that
Changed the World”, “Lean Thinking” en “Lean Solutions”.
 Executive Committee: Dan Jones, John Shook, Normal Faull
and René Aernoudts.
Jim Womack
Dan Jones

Lean Global Network
 LGN is a non-profit corporation with Headquarters in Boston, Cambridge,
USA and consists of a growing number of non profit or nongovernmental
organisations (currently 17) devoted to the promotion of lean thinking and
the development of lean leaders.

René Aernoudts
 MD Lean Management Institute Netherlands
 Executive Board member Lean Global Network
 Adjunct faculty at Virginia Tech, USA
 Research ‘Leadership in Lean Transformations’
 14 years of Lean experience in over 70 projects
worldwide (government, food & process
industry, retail & logistics, raw materials, heavy
equipment, financial industry)
 Fascination: developing people & organisations
in a Lean Thinking environment

Why is this an issue?
 Most Lean Transformations (70 to 75%*) do
not achieve the results they aimed for!
 Two critical factors identified as major
contributors to success or failure:
• The way transformations are designed
• The role and behaviour of involved
management
 The way the workforce thinks and acts, is for
80% determined by the way their
management thinks and acts
* Source: research performed in the USA and Europe
within 1500 organizations by leading universities
Designing Effective Lean Transformations

Root causes… and Countermeasures
1. Understanding by top management
2. Lean methodology
3. Design of a Lean Transformation
4. Change & Learning Approach

Understanding by top management
Root causes:
 A manager’s own ‘mental model’: a person’s assumptions about how the
world works, based on their experience, upbringing and character
 Often this current role and behaviour seem to have been successful for
them
 No previous experience with Lean
 No true understanding of what it is and what can be achieved
 Raised in a traditional way of reducing costs
 Uncertainty about their expected role, power, necessary skills and ability
to cope with a changing environment
Locked in a ‘bad process’… (it’s not bad people!)

Understanding by top management
Countermeasures:
 Create awareness for the ‘traditional’ mental model
 Reward the good things it brought but be clear about the necessity of ‘a
new way of thinking’
 Clarify what’s expected of the manager in their new role and behaviour
 Provide help to get true understanding of what Lean is
 Create ‘small learning experiments’…

Lean methodology
Root causes:
 If you are new to Lean Thinking, the
methodology in itself seems pretty
weird and complex… and full of
paradoxes
 People trying to convince you that Lean
is a good thing appear to be part of a
new ‘religion’ or ‘cult…’
 Lean shows itself as a set of mere tools
but is in fact an integrated system
 Lean is not providing easy solutions, but
puts ‘tension on the system’, which
“will create problems…”

Lean methodology
Countermeasures:
 Create awareness that Lean is an
integrated system, that will ‘get’ to
you step by step and that you will
have to ‘Learn To See’
 Prevent to get stuck in ‘Lean jargon’
 Be clear about Lean not being a
‘quick fix’, but a driver to structurally
eliminate problems by eliminating
root causes
 Spend time ‘getting to know’ Lean

Design of a Lean Transformation
Root causes:
 Static-static thinking versus static-dynamic
 Design following a traditional Project Management approach (Push)
 Not connected to the core business issues (Pull)
 Design done by staff people or an external expert, hired to try to convince
the organisation to follow his or her ‘model’
 ‘Copy/paste’ or ‘boxed/instrumentalised’ approach
 ‘One size fits all…’

Design of a Lean Transformation
Countermeasures:
 Start with the real business issues and understand the types of problems
you’re trying to solve:
 Problem
 Maintenance
 Development
 Characteristic/unsolvable
 Design a fitting approach using experienced resources and ‘owners’ of the
process
 Only use ‘thoroughly tested’ approaches, so run controlled experiments
 Follow the PDCA cycle

Example…
Strategy Deployment, A3 thinking, leading principles,
Go See (Gemba Walking), Ask Why, Show Respect,
Standard Work for management, Education
Lean
Leadership
Value Stream
Improvement
Operational
management
Identify Value Streams, eliminate waste, creating flow,
pull systems etc. either via Kaizen of Kaikaku on Point,
Flow or System level
Performance, Capacity and Visual Management
Working on Basic Stability (4M’s, OEE, 5S and other tools)
Problem Solving Culture and Continuous Improvement
Knowledge,
Skills,
Behaviour
To ensure a solid understanding, acceptance and motivation
for working in a new way we invest in a build up of
knowledge, management skills, education and behavior.

Let’s revisit some basic Lean questions
1. How will you
satisfy the
customer and
obtain a profit?
2. What are
your main
problems in
production?
3. How will you
achieve 100% JIT?
4. How will you
build in 100%
quality?
5. How will you
stabilize the
availability to
100%?
6. How will you
standardize work
100%?
7. How will you
develop natural work
team leaders?
8. How will you
sustain and
improve?
•On-time delivery
•Inventory
•Lead-time
•Customer defects
•Scrap
•Rework
•Capacity losses
•Downtime
•Scrap & Rework
•Labor productivity
•Scrap & rework
•Safety
•Team morale
•Skills development
•Small improvements
•Recurring problems
•Firefighting
•Poor problem solving
Typical Problems
Countermeasures or
analysis tools
•VS Mapping
•Flow of product
•Pull system / kanban
•Abnormality detection
•Stop the machine
•Process Cpk
•6 losses: OEE
•OA/Maintenance
•Problem solving
•Job Instruction
•Standardized work
•Motion analysis
•TWI/Job Relations
•TWI/Job Instructions
•TWI/Job Methods
•PDCA
•Root cause analysis
•Recurrence prevention
Key TPS Questions
Source: Art Smalley

Change & Learning Approach
Root causes:
 Training in tools (not in ‘the thinking’) in
a ‘traditional’ way, ‘One-off’ training
events in classrooms
 No clear structure in approach:
connecting the real questions,
deploying the strategy, understanding
what lean is, how to sustain results,
how to share learnings throughout the
organisation
 Not seen as a process in itself

Change & Learning Approach
Countermeasures:
 Rethink the way you educate
management!
 Apply Lean on the approach
 Create a common language and way
to learn using the A3 thinking
process
 Create new learning routines based
on Learn-Apply-Reflect
 Create a clear structure, providing
answers to different solutions

Learning levels
Ways of learning (examples):
Thinking Rationale Read books, listen to others
Feeling Experience Simulations, visits, gemba walks
Acting Will power Application in own environment,
controled experiments

Key advice
 Design based on true business questions
 Use a developmental approach
 Run controlled experiments as learning
environments using all involved to participate
 Learn-Apply-Reflect (short learning cycles)
 Build in P-D-C-A in education and development programs (C-A!)
 Let the managers become the trainers (quickly!)
 Teach using all three levels of learning (Thinking, Feeling,
Acting)
Create a pull for learning & development

Designing Effective Lean Transformations

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