How to lead a global lean transformation and make it stick

Implementing a lean system

 Leading a global lean transformation programme is not easy. In fact, 90% of lean transformations fail. For those seeking operational improvements across different sites, challenges are vast: from insufficient senior-management involvement, through to lack of favourable employee mindsets required to make change happen.

Peter Hines is a globally recognised leader in Lean Manufacturing, a multiple Shingo award-winning author and a senior certified facilitator at The Shingo Institute. He has consulted to Global fortune 500 companies such as GSK, Mars, and Siemens on pioneering Lean application including network sourcing and value stream mapping. We asked him your burning lean questions on how to succeed in global lean programme roll-out:

Peter Hines on Lean transformation

 1. What’s the most effective way of building out the skills required to support a Lean journey?

If you are trying to create a lean journey leader clearly, developing an understanding of what the journey is, creating the knowledge, the skills the appetite and enthusiasm to do it are all really important areas at beginning to address. There are many ways to do this, but generally what I would say, the starting point is with the senior management, the VPs in the organisation. If they don’t understand what lean journey is about, how can they lead the actual programme? So what we find is, the sort of Masterclasses that we ran at TLN are ideal to bring people in, get that high-level understanding and after that, start thinking about how you cascade that down to the middle-management and lower levels in the organisation.

2. How to find the balance between rigid Lean standards and requirements and the flexibility to modify tools and processes to fit the application/work where they are used?

Clearly within lean, there is a number of tools and techniques, but quite frankly, that's not where I would start. The starting point is understanding what are you trying to achieve in your organisation? What's the strategy? What's the goal? Then deploying that down to everyone in the organisation in a way that they can understand what are we trying to achieve and why. Then let them start thinking about how they might make the improvements, the improvements are bottom-up. My view is, when you start thinking about the tools and techniques that you’d apply it's good to start standardizing a number of maybe five or six tools and techniques in the business, this is what it is, this is how it operates and then teach people how to do it, but let them have some autonomy to move it around, to make it work in their environment. For instance, if you’re applying 5S as a tool, how you do that on the shop floor might be a slightly different than how you do it in the R&D environment, so give some flexibility, get people involved and empower them by letting them think in their own way.

3. How to decide which metrics to focus on?

When you’re thinking about metrics, obviously we all are in business to achieve results. The sort of results we might want to achieve is the growth of the business, decreasing turn-over, the profitability, shareholder value. These are the general top level KPIs. However, if you’re trying to create improvement I would say those are all outputs or results, lag measures. Better than thinking about that, start thinking about a lead measure that will actually lead to those results. For example, what is the percentage of people involved in an improvement activity? What's the level of engagement of people? What's the skill level of your people? If you work on those sort of KPI, as lead or even behavioural measures, you’re much more likely to produce the results that we talked about in terms of growth, turn-over and profitability.

4. How to keep the momentum after continuous improvement lean events?

One of the issues that we find in many organisations is not starting the lean programme, usually the first six months or a year,  it’s all fun, exciting, people get very engaged. Often the problem comes year and a half, two years in. The improvement has gone really well and then people start saying: Didn't we do this last year? So it maybe starts to plateau or even slide a little bit. What we need to do is many different things. We need to make sure people understand what they're trying to achieve, we need to make sure that there's a coherent improvement system with the bottom up ideas probably more important than anything else, the role of the senior leaders, the standard work of the leaders, the leader’s standard work in going around motivating, sharing things that are happening, identifying opportunities for improvement, coaching, recognising people when they are making gains. This is something that we see not happening well enough that's why things slip back.

5. How to align efforts across global sites?

You find big multinational organisations doing lean and sometimes you find one site that's a real standout, doing fantastically. Then you’re going to another site, same company, maybe even in the same country, not doing nearly as well. Some of the research that we’ve done is trying to understand how do you get this to be a consistent across different sites, across the group. Working with one major global pharmaceutical medical device organisation, what we found is, we tried to understand why they had been so successful at one of their very best sites. We looked at 10 different steps of how they have gone from top level strategy, defining strategy locally, behaviours, deploying this down, creating improvement, employing tools, leaders activity and learning and development approaches. What we found is that the majority of the reason that they had been successful is they actually developed the approach themselves. They worked on six or seven own formula, they owned it and that’s why it worked. The challenge they had is how are we going to implement this across the group? When the success had actually been local involvement of the people. What we decided to do is not put it in a can, size it up, give it to the next site and tell them to do exactly the same, but actually go through the same learning process that the very successful site had gone through, actually help them to understand steps and work with them to understand what do we do to make this work in our environment, be that in France, Germany or Singapore. In other words, they owned the result themselves. It was their programme, not something the corporate office has just told them to do.

6. How do you get functions working effectively together, pulling the correct lean tools in to resolve flow disruption

Sometimes in organisations, we found that lean, improvement activities, enterprise excellence, whatever you want to call it, are actually well embedded in one or two functions, typically the operations, maybe supply chain. And then you go to other environments, maybe HR, or finance or engineering, whatever it happens to be, and there's almost no activity in that environment. So really what we need to do is to think about this whole-company approach, rather than just one particular area, so part of this is starting to look at core processes and systems in the organisation. For most organisations, there is three core processes:

  1. One is producing the product or service required by the customers
  2. The second is developing new products or services
  3. The third is winning business, finding new customers, selling the product

That's probably a starting place. Look at those three core processes and all of those are quite cross-functional. Start looking at how to optimise the processes, rather than measure and reinforce the functional silos. Start cross-functionally rather than make the silos even deeper.

Learn exactly how to create a sustainable world-class Lean culture at Nestlé: 

 Leading the Lean Enterprise

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