Why Lean Fails: Operational Excellence Treated as Tood Based Vocation, Not Principle Based Profession

By: Steven Spear

Author of 'The High-Velocity Edge' and 'Chasing the Rabbit' - from The Lean Edge- posted Sunday, April 3, 2011

Lean efforts are aplenty. Rare are successful ones-characterized by sufficient improvement in the ability to create great value by delighting customers with best in class products and services, offered reliably and responsively to change, done affordably and profitably. Nearly unheard of are sustainable successes-characterized by success over years and waves of market change and leadership succession.

Why?

The few world-class organizations that compete well on 'operational excellence,' reflected in quality, variety, time to market, affordability, agility, and many other positive attributes-manage the complex operating systems on which they depend based on few principles, adherence to which allows short term reliability and 'high velocity' sustained, broad based improvement and innovation. Furthermore and because of this, operations-the design, running, and improvement of the complex systems for development, design, and delivery-is treated as a strategic concern, occupying the time and attention of senior leaders, generation to generation.

Those, not of the very few, fail in predictable ways.

First operational excellence is defined as a vocational craft-the skilled application of tools onto problems-rather than as a principle-based profession. Then, because operational excellence is treated as a vocation, experts in standard work, line side stores and supermarkets, kanban control of just in time, and the like get relegated in role with the other skilled trades-important in supportive roles and called on episodically when needed, like plumbers, electricians, radiology techs, and phlebotomists, but not core to the competitive efforts of the organization.

What is the solution?

First, recognize that all professional disciplines-those that rise to prominence in organizations-are built on simple, sound principles, and expertise is displayed by the application of those principles to ever more sophisticated situations in order to create value. Professionals use tools but are not defined by them.

Finance, for instance, is built on net present value, option pricing, and portfolio theory. Those three ideas are what is applied to the design of transactions to maximize monetary value. Mechanical engineering is built on Newtonian mechanics, a few laws of thermodynamics, some material science. These are applied iteratively to the design of technical systems of incredible complexity, to maximize their functional value. Strategy is built on the simple principles of positioning more strongly than weakly, vis-à-vis competitors and customers to maximize ability to capture value with products and services in markets.

Second, reframe operational excellence to be like other professional disciplines, moving from the vocational application of tools, artifacts, and isolated applications and moving to bona fide principles of design, operation, and improvement in pursuit of maximizing created value [not merely eliminating waste].

The essence of operational excellence is not (and cannot be) tools like, continuous flow, focused factories within factories, value streams, and standard work.

Rather, those tools all reflect the principle that declaring in advance of use how a system is expected to operate maximizes value by maximizing the chance to be successful by harnessing best known approaches.

Likewise, the essence of operational excellence is not SPC, poke yoke, or lines pained on the floor. Rather, those tools all reflect the principle that testing in use how a system is actually operating maximizes value by maximizing the chance of seeing problems when and where they occur.

A3, DMAIC, PDCA, and Shewhart are not 'essential' to operational excellence. All are tools reflecting the principle that solving problems with the scientific method-as a bona fide hypothesis-testing exercise-maximizes value by maximizing the chance of building new, useful knowledge where ignorance prevailed previously.

In short, sustainable success is impossible so long as operational excellence is explained and practiced in a tool kit approach. That allows only imitative excellence in situations imitative of the situations in which the tools were seen used. It relegates operations experts to supportive rather than organizationally leading roles.

True sustained excellence comes about from having systematic approaches for designing complex work to capture known knowledge and to see problems as they occur, to solve problems to build new knowledge, and to incorporate systemically what was learned locally. Leadership models and cultivates these skills relentlessly.

Toyota, Apple the Navy's 'nucs' program and very few others demonstrate this in their unique capacity for reliability and high velocity improvement and innovation. The corollary is proven by the near uniqueness of Toyota, Apple, and the Navy's 'nucs' program despite the near universality of lean and six sigma tools tradespeople and kaizen jockeys.