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Michael Balle

Michael Ballé: The leadership to learn to recognize the problems you create and lead the organization to solve them

By Michael Balle, co-author of The Gold Mine and The Lean Manager - Last updated: Thursday, February 25, 2010 - Save & Share - Leave a comment

There are reasons leadership gets stuck in a dysfunctional cycle. To get out of a bad-outcome pattern, you first have to admit to yourself that you will need to learn to dig yourself out of the hole. Sadly, I’ve met many leaders of companies in similar situations, and they are convinced that it’s a matter of making the right decisions and then executing ruthlessly. Unfortunately, they are blind to the fact that it is their very decision-making process (and not the big bad world out there) that delivers unsatisfying results. The decision-making framework assumes that 1) we already know all the relevant information and 2) we know how to establish priorities correctly. If this was the case, the company would not feel the way it does. (Chances are everyone is convinced they have the right answer but others won’t listen).

The lean approach is radically different. The lean path is one of collective discovery of what the real problems are. Experienced lean practitioners recognize that in all you do, about ten percent of your activities have spectacularly good results, about ten other percent will turn out to be catastrophic, and that most activities have just indifferent consequences. Even the leanest companies occasionally make catastrophic choices (such as Toyota’s choice to lobby NHTSA rather than fix the problem with its cars), but, contrarily to most, lean companies are focused on constantly understanding the impact of their choices and how to respond to changing circumstances. The first step to getting out of the spiral is to realize that – rightly or wrongly – what you do creates problems.

The second step is to recognize the problem one creates. In fire-fighting mode, this is very difficult because there are problems all over the place, and people are not focused on solving them, but have usually become experts at “workaround” – finding clever ways to side-step dysfunctional processes to make the problem go away (and affect someone else or return at a later date). The place to start is with customers. In services, customers typically will expect:

Customer problems are a good place to start. One simple target is to solve completely one customer issue per week. The idea is not simply to compensate the customer for their lost value, but to truly investigate what in the process created the negative outcome for the customer, ask ‘why?’ repeatedly and seek the root cause of the problem. The management team can commit together to a “customer problem” exercise a week (prepared by someone on their staff) where they go to the workplace and try to agree amongst themselves on what is the fundamental problem. After 1) accepting one creates problems and 2) recognizing those problems and issue is now 3) mustering the political will to solve these problems. If the management team cannot commit to focus on specific problems together, it is unlikely to have the fill to fix what is wrong with the company. (An alternate way of doing this in the lean tradition is to find a sensei and to go and visit processes as a management team so that he or she can point our problems in processes)

Once the management team has begun to recognize some typical problems, a “kaizen event” program is a natural next step. The idea is to create ad hoc small teams of people in the organization to improve locally specific steps in the process. If this is not driven by a senior management effort to figure out what the real problems of the company are, the program will just get lost in the sands (no matter what results are achieved locally). It has to be well understood that the fourth step of getting out of the cycle is… learning how to do so. The kaizen events in lean are not there to fix the process per se, but to explore how to fix the process and teach people to have the autonomy and skill to do so every day.

The discipline of examining specific problems as a leadership group (as opposed to large, ideological debates) and to give permission to teams of frontline staff to experiment with local solutions will progressively lead to a clearer understanding of breakthrough improvement: where are breakthrough is needed on performance (where do we need to be radically better) and what is the corresponding breakthrough needed in the process (what is it that we need to learn how to do radically better). As this clarifies, the key to success is sheer grit: sticking through the hard learning part until results improve.

The lean approach is essentially about recognizing three kinds of problems one creates:

Once these problems are recognized, they will be solved by kaizen: small steps attempts by the people themselves to understand better how and where processes go wrong and find clever ways to improve things without investment. This will deliver immediate short term results, and, over the mid-term surface a few bigger things that need changing in the company’s operations to sustain these improvement in the longer term. Exercising problem-solving will also reinforce relationships amongst co-workers and reward the good people for their commitment and ingenuity.

To sum up, the lean medicine is often counterintuitive. It’s not about being brilliant at finding the magic bullet solution, but about 1) going to the workplace to see how specific cases of customers went wrong; 2) collectively agreeing on problems; 3) giving permission to people to try things to fix problems and 4) progressively coaching everyone in the company to root cause problem solving to attack both detail process concerns and breakthrough issues at company level. This is a thousand step journey, so the quicker the first step is taken, the faster we’ll get somewhere.

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