In these two articles, editorial board members Peter Watkins and Brenton Harder look back at years of lean implementation across global operations, and explain how explain how companies can deliver change consistently and coherently around the world.
Peter Watkins, GKN
Arguably, lean has been around globally for a long time and some of its history has been noted over the centuries: in the 1500s the Venetians built ships in flow; in the 1800s the Americans used production flow for armouries; in 1913 Ford introduced the flow line for the model T; in the 30s German aircraft were manufactured to takt; then came Toyota and today’s application of lean in hospitals and government.
If lean is historically so global and its scope is so diverse, then surely deploying its principles across boundaries would be easy for GKN. Think again, as we are a very complex global engineering group with 50,000 people working in over 40 countries and four operating divisions (GKN Driveline and GKN Powder Metallurgy for the automotive market; GKN Aerospace; and GKN Land Systems for power transfer technology in agricultural, mining, construction and industrial sectors).
So how do you start to deploy a consistent, successful lean strategy across many sites around the world?
Adopting lean globally starts with changing the existing way of thinking, which could derive from any of the following:
- Company thinking – Command and control & organisational politics;
- Global financial thinking – Focus on short term results;
- Current management thinking – Have all the answers, unwilling to learn;
- Industry thinking – “We’re different – it can’t be done here”;
- Country thinking – Hierarchical rules that don’t allow for change to happen;
- Individual thinking – Unwillingness to change (this can encompass all of the above)
To describe how GKN people have successfully adopted lean over the last 10 years would fill a book, not a short article. I have narrowed this down to three main key lessons we learned. Lean thinking must be:
- Understood by everyone;
- Deployed through teaching and coaching;
- Used to develop and achieve strategic direction and business results through robust PDCA.
Making lean simply understood and connecting it to the business language is vital to ensure globally aligned deployment. At first, in GKN many leaders were reticent about lean, because they didn’t understand the language around the concepts, tools and methods.
At the time, the CEO used the business language and during a discussion with him on how we could connect lean with this language the following was developed:
The more we align and improve the “flow of value” through our suppliers and internal processes to meet our customer needs , the more we improve our overall shareholder value .
This gave birth to the concept “The Flow of Value” in GKN, which was understood and could be used by everyone, and not just lean experts.
PEOPLE DEVELOPMENT – LEADERS ARE TEACHERS
For most people lean requires a change from the current way of thinking. This does not come easily from just reading books or copying others, but from being taught and coached by leadership through “learning by doing” and solving problems together.
If the leaders are to be teachers and coaches, then a change to their current thinking needs to happen first.
As well as measures, tools and assessment frameworks, we kicked off the leadership change in GKN by introducing lean leadership development programmes based on practical learning by doing.
These were instrumental in bringing about change; they are run globally with diverse organisational participation. Graduation is attended by CEOs, where good practice and implementation is shared.
Warning: make sure that training is seen as “the answer.” This is only the start in the absence of tiered coaching by leadership (Toyota took many years developing this coaching capability). I remember, at the feedback session on our first leaders’ programme, one leader said that was the best training they had received – but what would he do with it now? Leaders as teachers and coaches can be a real alien concept for some. It is only when the organisation has developed tiered PDCA for coaching problem solving and daily CI by line leadership that the real change in thinking begins, not by means of a “one-off” training programme.
CHANGE THE MANAGEMENT SYSTEM – THE WAY WE DO IT
The purpose of a company management system is to support the achievement of strategy and yearly business results, so it’s crucial that we make the necessary changes to insert lean thinking in our management system (see bubbles in figure 2). In GKN, this has been one of the hardest areas to change, from result-oriented to process-focused and now people-focused.
We are still pursuing this management system change today, as our lean culture further develops. The initial change started with the introduction of a standard process for continuous improvement planning, operating standards for value streams, problem solving for deployment and leadership Check Act activities – value stream walks, etc.
Through our Business Process & Production Excellence approach, many of our key processes have now been defined, measured and re-organised.
As an example, GKN Land Systems’ divisional strategy for operational excellence is based on the pursuit of the following strategic points: target setting and CI planning; end to end processes; operating principles; operating standards; developing people talent.
Figure 2 explains how we are integrating lean thinking into our Management System.
It’s been 10 years since we started our lean journey at GKN – we have had some fantastic successes all over the world and yet in some areas progress is slow. One thing has become clear: global success totally relies on leadership.
Brenton Harder, Commonwealth Bank of Australia
For the past two decades, I have had the opportunity to participate in four different lean deployments across a variety of industries and international geographies. Each deployment followed a different path yielding a range of outcomes from short-term cost efficiencies to long-term cultural changes. However, without a broader context or a common “gravity”, I’ve observed that most large-scale deployments have a tendency to spin out of control:
- Many were narrowly focused with a myopic concentration on low-level and small-scale activities, typically within one functional unit. When managers attempted to apply lean to larger-scale projects, results were unsatisfactory until the scope was re-narrowed;
- Lean was not well-aligned with the strategy of the organisation as a whole. Although each individual project was worthwhile, in the aggregate the projects did not contribute to corporate goals;
- Lean efforts had not gotten at the company’s basic assumptions or its functional organisational structure. Because breakthrough improvements in performance require just such fundamental change, lean’s impact was limited;
- Geographical dispersion led to independent and disconnected programmes of execution with little synergy or cohesion. Differing lexicon and methodologies inhibited the development of a sustained community, and actually produced competing priorities and goals across the organisation.
Lean gravity provides a cohesive force that loosely unites common goals, language, and recognition of lean benefit through the development and use of a broad and interconnected community. It is an active and engaged dialogue that goes on just under the surface of an organisation through internal social networks, email exchange, and even face to face interaction. Especially for a large, international organisation, lean gravity is like a system of planets orbiting around a sun providing an invisible yet tangible “pull” across an organisation.
Through the development of such a community I’ve seen the greatest success and long-term sustainability of any process improvement or lean initiative. At my last company, we struggled for years to get the business engagement and necessary traction to engender a true ownership for continuous improvement. Instead of “fishing” for itself, the business would continually engage my process improvement team as internal consultants to “bring it fish”. Each project left nothing but an improved process behind.
It wasn’t until we replaced this structure with a robust community of practitioners assigned to each major business unit that we began to see the sustained capability needed to meet our goals. Our community started with practitioners we had purposefully “pushed” into various business units, but quickly grew to include others that had been involved with improvement efforts.
We provided a social platform through our Sales Force Chatter network, built open intranet posts, and sponsored several specialised blogs hosted by interested and engaged community members. This structure was held in orbit through a single source for common goals, language, and the recognition and celebration of broader benefits, but expanded rapidly through the interest and engagement of community members.
Lean gravity became self-replicating and sustaining. Elusive success was finally recognised by letting go and letting the business do what the business needed to do, and less about the over-reliance on a single methodology, process, or tool set. Gravity is about letting go while holding on.