Lean Management of a Dispersed Organization
Many senior executives have struggled and failed to gain the advantage of a multi-site or dispersed organization. Instead of capitalizing on the potential value of multiple sites for learning, it seems that too often the same lessons have to be learned over and over again without any shared learning. This is a failure of senior management. In a lean organization, managing learning and improvement is the primary function of senior managers in addition to deploying capital.
Some years ago there was a case study article written about a very successful Sherwin-Williams paint plant that was a pioneer in implementing self-managed work teams in a manufacturing plant. We used to use this case study in our training. I was speaking at one of Norman Bodek’s Productivity conferences and I mentioned this case. After my talk three individuals who were in the audience came up to me. Each wore “Sherwin-Williams” badge. They also wore a puzzled look on their faces. They were surprised at the mention of this case study. They had never heard this case or about any such a success story in one of their plants.
This drives me crazy! Every experiment at improvement is just that – an experiment. It requires an investment. Whether the lessons learned are positive or negative, the entire organization should reap the benefits of those lessons. One of the core principles of the Toyota Production System is experimentation. Continuous improvement requires on-going experimentation and learning from those experiments. Too often we experiment and then hide the lessons learned.
Managing learning is one challenge of senior managers. Another challenge is balancing the need for developing a shared culture across the company and for allowing necessary local adaptation to diverse cultures and work processes. So, what does the leader of a global dispersed organization do to manage the implementation of lean and gain its advantages in the most economic means?
Let’s pretend that I am the CEO, COO or VP of Manufacturing for a large consumer products company with about thirty manufacturing plants and distribution centers across Europe, North and South America, as well as China and Japan. I am newly appointed and I want to introduce myself to the management of these thirty plants. In a face-to-face meeting, and in writing, I would say something like the following:
“As the newly appointed leader of the global manufacturing and distribution organization, you are probably wondering what my expectations are. I think it is important that I set clear expectations. So, here are some of the things I expect and that I believe in.
Continuous improvement: First, and perhaps most important, I believe that everyone, and that includes me, you, and everyone in your organizations, must be engaged in continuous improvement. We all must improve customer service, eliminate waste, and improve quality. None of us are there. None of us have achieved our potential. The important thing is that we are working hard to improve. We all should possess a “creative dissatisfaction” that drives us to the next level. So, when I visit your locations, which I intend to do often, I want to see a process of continuous improvement that involves every member of your organization.
Scorekeeping: Lean manufacturing requires managing by the facts and that means keeping score. I will have a balanced scorecard for the organization. This will include key financial measures, process improvement measures (such as reduction in in-process inventory), learning and development and customer satisfaction. Each location should have their own balanced scorecard with these same categories of measures.
Teamwork and Engagement: The world’s greatest experts are “on-the-spot”, where the core work gets done. It is your job to help them be expert. I believe that every frontline employee should be working on a team to improve the processes for which they are responsible. Your job is to enable them to be expert and to solve problems.
Experiment, and then experiment again: Most learning and improvement comes from simply trying things and measuring the results. When I visit you location I would like to see and learn from your experiments. There is no shame in a failed experiment. There is only shame in failing to experiment and learn from that experiment.
Standard work: When you try something and learn, you standardize what works. Work standards are not set in stone. They are the best way we know how to do something today. This is true for managers as well as front-line employees. I will have my own standard work and I will share this with you. I want to see your standard work. Every manager should have standard work that includes walks through the location, observations of safety practices, charts and graphs, etc.
Visual Display: No sport ever garnered a lot of fans without a scoreboard. No team ever achieved excellence without seeing their data every day, if not every minute. Every team, in every location, should have a visual display board with their key data measures graphed and up-to-date, process maps, problem solving visualized, and safety information. Visual displays will be standard practice in all of our locations.
Celebrate Success: One principle that I know leads to success is the simple idea of recognizing and rewarding good performance. This can be done in a hundred different ways. I would like to know how you are celebrating your heroes, those who set records, innovate, and contribute to our shared success. Remember that Generals make heroes of the common soldier whose actions on the battlefield determine the victory.
Interruption Free: I hate “walls”, fiefdoms, or the failure to share information or help your fellow team members. From the customer’s point of view, we are just one organization, one brand. If the product has a defect or is too expensive, they do not care which piece of the organization is responsible. I am responsible. You are responsible. We are all responsible for sharing information and lessons learned through the walls of the organization.
“In order to make this real, I plan to have a global leadership conference every six months. But, the first year, I will have it every quarter to speed the process. Every one of you will come prepared as both an expert teacher, and as a humble student. I want you to come with a two to five page description of what you are doing to implement a high performing lean organization and culture. I want this to include your analysis of what you have learned in your efforts. I want to hear what has worked and what has not worked. This is not a competition to impress me or anyone else. It is forum for learning. Your failures, or negative results, are important because they can save time and money on the part of others. Of course, your positive results can also be copied. Each of you will make a short presentation and answer questions from your “students.” We are all going to “go-to-school” on the lessons that each of you is learning. We will all get smarter in the process.
“Please keep in mind that it isn’t where you are that is important. It is where you are going and your efforts to get there. This is what I am looking for and this is what you can expect from me. Oh, by the way, all of the above is just as relevant to our staff organizations as it is to the line manufacturing and distribution organizations.”
So, that is what I would propose as a beginning to implementing lean across a dispersed organization. Then, I would search for and develop the tools that would aid the organization in that implementation. But, as the leader, I would see my primary role as “Chief Learning Officer.” I would be very interested to hear what you would do in addition, or instead, of the above. What have you seen lead to success across a dispersed organization?