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Jeff Liker

Jeff Liker: Lean Has a Short Half-Life Without Intense Involvement Of The CEO

By Jeff Liker, - Last updated: Thursday, June 10, 2010 - Save & Share - Leave a comment

One thing we know about lean is that you learn it by doing it, not by sitting in the office.   With all of the different types of organizations I have worked with I must admit that it has been rare to go with the CEO to the gemba.   They have not participated in kaizen activities, our meetings are in offices and board rooms, and in other cases I personally never met the CEO.  For the most part our contacts have only gone as high as the vice president level (engineering, continuous improvement, quality, operations).   That is a problem.  We have personally and painfully confirmed the conventional wisdom that lean has a short half life without intense involvement of the CEO.  A typical scenario is that we are brought in at the VP level who delegates lean to the manager-director level and we do model line projects or kaizen activities that are successful with a lot of hooh ha about how great it all is.  The local results from our activities are outstanding, the people we work with learn a ton and go through personal transformations, we are excited and life is good… until we hit the wall.  The wall could be a downturn in the economy, someone being hired with a different idea of what should be done (e.g., a six sigma champion), or often is simply the CEO running out of patience.  “Where are all the great bottom line results I had heard about?”

When we hit the wall one of two things happens.  Sometimes the lean program gets a back seat and dies a slow death and in other cases the CEO wants lean spread fast with direct accounting for bottom-line results.  Then we get cookie-cutter lean (e.g., spread the kanban, standardized work sheets everywhere, etc.) and managers who are accountable for results or else.  Often that means lean audits of various kinds.

What is the cause of the problem?  Lack of CEO commitment to a true lean transformation and the strategic business benefits that can come from it.  Of course that is the answer to the first why.  Wy are they not committed?  They have know reason to be committed since they have never experienced it and do not really understand it.  Why have they never experienced it?  They worked in a traditional organization their whole careers and by the way succeeded enough to become CEO.  How were they able to succeed without lean this long? Because they are good at what they do and learned ways to make the traditional organization perform at a reasonable level by focusing on bottom-line results.  Why are bottom line results so important?  Because that is what they are asked about by shareholders or boards of directors and the only way they know how to deliver is through cutting budgets, pressuring managers, acquiring businesses and in other ways manipulating the business so the spreadsheet looks good.

Given that analysis what can we as lean consultants do to change the thinking of the CEO and reverse thirty years of experience on how to be successful without a lean enterprise?  We know what does not work:  persuasive speeches, charming conversation, legitimacy because we wrote a book, logical debate, local successes in creating great-looking model lines, and more.  What does work?  First, as is often the case there are at least three groups of CEOs.  There are those who already believe in lean or are close to it, those at the other extreme who are unreflective bean counters who will never be convinced, and a large mass in between that have no emotional connection to lean, but can possibly be convinced. Let’s drop out the hopeless lot and focus on the middle.  We could change the organization below them as quickly as possible with the support at the VP level and expect the CEO to realize how great life is with this new efficient and responsive organization.  Better is for a lean sensei to become the personal confidante of the CEO and take casual walks through the gemba with the CEO. That takes a certain type of sensei, a great deal of persistence, and some sort of chemistry between the sensei and the CEO.

I have seen it work and it can be very effective.  There are some prerequisites.  First the sensei has to actually meet and spend time with the CEO.  Some sensei are bold enough that they insist on developing a relationship or walk away from working with the company.  I now one, actually it was a man and woman consulting team, who insisted that every week them come to the organization they spend 2 hours monday morning with the CEO walking through the operation.  That was a prerequisite to engaging them.  Second the sensei needs to find ways to engage the CEO so that they want to keep going to the gemba and find it a transformative experience.  CEOs generally are very busy, very successful, and sort on patience.  If they get bored even for a short time you are toast.  to be successful the CEO has to be convinced to actually do something, such as participate in a kaizen event.  I would expect most in the community have found that when this happens the CEO does in fact go through some sort of transformation.

In short, I do not believe there is any magic bullet here.  The CEO rules the roost and does not have to listen to lean zealots our follow our leads.  They decide.  Many will never be won over.  Perhaps if the VP is a successor to the CEO it makes sense to focus on them.  In other cases perhaps with greater effort to meet the CEO, get to know them (perhaps even outside of work), invest in a relationship with them, gradually build their trust, and when nobody is looking put them in a sack and drag them to the gemba we can begin to change their thinking.  Then we must hope that if we do in fact change them they stay in the position and are able to develop a successor who also believes in lean.

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