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Orry Fiume

Orry Fiume: The CEO must remove all barriers to lean, and some barriers are people. If one person must leave the company, do so with respect

By Orry Fiume, - Last updated: vendredi, août 1, 2014 - Save & Share - Leave a comment

The problem that you cite is a common one. Below is an excerpt from an article that I wrote for the Journal for Organizational Excellence a few years ago. The at the beginning of the article explains that Lean is a Strategy, not a manufacturing tactic or cost reduction program. This excerpt is the part of the article that discusses things the CEO must do to increase the likelihood of a successful transformation:

Mandate Lean. Perhaps the most important Lean “intervention” by Wiremold’s CEO was to make it clear that opting out of the Lean strategy was not a choice for anyone. Everyone was told (1) they must support and participate in Lean, (2) how that would benefit them, and (3) if they did not participate, they would be assisted in finding employment elsewhere.

Although it might sound harsh, there were solid reasons for this stance. In the early stages of a transformation, a small percentage of the workforce will “get it,” like it, and want to run with it. Likewise, a small percentage will hate it and try to block it at every opportunity. The tendency of the large percentage of workers in the middle will be to watch from the sidelines to see who wins. But in a Lean transformation process, true learning comes from doing—the more people that are involved in the doing, the greater the number of early successes, which then fuel additional efforts and create positive momentum. By not allowing people to opt out and by providing air cover for early adopters, the CEO can send a clear message that everyone is expected on the field, contributing to the effort.

Once the organization is rallied around a Lean strategy, the CEO must remove the barriers to Lean. At Wiremold we found that in some cases the barriers were people. But more often, we found obstacles posed by

l Systems (e.g. MRP, standard cost accounting)

2 The organizational structure (e.g., many layers, fiefdoms)

3 Policies (e.g. sales terms, compensation)

These had adequately supported the old batch-and-queue method of operating, but they had inefficiencies and wasted activity, inhibited teamwork and information flow, or reinforced behaviors that ran counter to Lean. The CEO must put everything on the table for scrutiny—allow no sacred cows—if the organization is to truly transform the way it functions.

So, the question is…how does this tie into Leading with Respect? First of all, if the person is allowed to opt out then this is showing disrespect for all of those employees that do work hard to make the Lean transformation successful. Once a person is given a fair chance to change their behavior, but consistently demonstrates that the either won’t or can’t, then the decision is that they have to leave the company. How you do this should also be in line with the Respect principle. They need to understand why this decision was made, given a decent severance package and given outplacement assistance until the find employment in a company that will allow them to continue with their traditional behavior…still lots of them around.

Fortunately, at Wiremold we only had a few instances of needing to do this, but it is essential that it be done. Some companies want to take the path of putting the non-compliant employee in a job where they can’t do any “damage”. This is like putting your head in the sand, as those people will always find ways to undermine what you are trying to do.

I hope that everyone is having a great summer,
Best Regards

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