Jonathan Gray is VP at Hitachi Consulting, the management and technology consulting arm of Hitachi. Here he explores why Lean Six Sigma transformations fail despite the best expertise and how to lower the rate of unfulfilled continuous improvement programmes.
To achieve tangible business value from continuous improvement initiatives we must move beyond process excellence and the primary focus on method and tools. Lean and six sigma techniques have been adopted by many industries; however, we are seeing 50-70% of initiatives fail to reach their full potential, ‘hitting a wall’ after initial improvements are made.
Role-modelling lean leadership behaviour, which truly empowers and engages employees in the transformation journey and ensuring improvements are connected end-to-end. This is by aligning by aligning initiatives to core business strategy and ensuring improvement targets go beyond cost reduction; focusing on time-based and service level competitiveness, are the central tenets to real business transformation. However, there are often significant barriers which must be overcome in order to affect lasting change.
Senior leadership teams must be practically, rather than nominally engaged in moving beyond steering committees and sponsorship roles to fully embracing transformation initiatives and role-modelling the required behaviours they request from others. This must involve true collaboration at all levels and the actual break-down of organisational silos – a much bandied term, but one which often does not get any real traction – through a shift in focus from tools to change management and leadership development. Employees must be given the accountability and authority to be empowered. Leaders must translate words from leadership presentations and demonstrate them in day-to-day business life, whilst coaching others to achieve the same, throughout the organisation. Leaders must teach lean thinking.
There is a logical sequence to overcoming these barriers and it starts with the change organisation itself.
What are the new skills required in a change organisation?
Learning change management and coaching in a classroom is a world away from doing it in reality. It is critical internal change teams to understand the working context of the people they are supporting, so they can relate change activities to the daily lives of employees and the performance of their business. What is more, in this way change teams are perceived as jointly responsible for the success of those activities, demonstrating a higher level of commitment to results defined and delivered together.
To effectively change behaviour at any level, change teams must go beyond transactional interactions – typical of interactions with senior leaders and managers – as the conversation moves away from process and toward the individual. Being able and willing to move into a more interpersonal relationship when required is critical to success. This is a component rarely found in any job description, but should be a high priority when selecting members of a change team.
Lastly, while leadership development coaching is about supporting leaders to engage, motivate and empower people, in reality, the biggest problem for many leaders and managers today, is time. Leaders can have fantastic people skills but if their calendars are too full with extensive travel time or meetings, they simply have no time to demonstrate it. Personal effectiveness is an equally important skill set. Leaders must be able to create time to think, in order to prepare, delegate and coach team members. This is an often forgotten but core competence of internal change teams – to support leaders to rise to the challenge.
How do we break down organisation silos?
A team is by definition, a mutually accountable group with complementary skills, committed to a common purpose. However, senior leadership teams are often treated as distinct groups of high-performing individuals, while shared goals are often distilled down to financial performance, which can appear abstract in the day to day.
Finding a more perceptible shared objective can appear difficult. But in fact, it is business transformation itself that should be the common goal. The goal: drive performance improvements across the end-to-end value stream and create a rewarding place for people to work. This will result in a high-performing organisation and create an environment for true continuous improvement. Integrating business transformation governance directly into the business performance management system locks improvement activities directly to business results, creating pull throughout the organisation. To successfully secure business targets, teams must work together to mitigate risks and support each other in implementing end-to-end improvement initiatives.
Leaders must role model change – the lean leadership maturity model
All of the above rely on leaders being open to learning and change themselves, and creating a learning environment for those around them. Successful business transformation which delivers rapid results and lasting change cannot occur if all levels of the organisation are not involved equally.
This is why lean and six sigma methods and tools, when used in isolation, are not enough to deliver lasting operational transformation. Instead, they should be used as part of a broader approach to driving continuous improvement.
The lean leadership maturity model articulates the evolution of lean deployment in most organisations. Organisations start by deploying rigorous standards, prescriptive tools and audits to measure implementation with leaders driving implementation through compliance to standards. This will initially deliver strong results but over time improvements will slow down and results will plateau; you have hit the wall.
To get over the wall the focus must move to flexibility, experimentation and lean thinking. This needs a different approach to leadership. Leadership must focus on reinforcing lean behaviours through situational coaching. Critical to success, is the time commitment from leaders to coach and support their teams in the implementation of lean. Time spent at gemba, coaching teams and supporting continuous improvement must be the first priority, and if demonstrated consistently, is truly transformational.
Which organisations deliver change best?
Those that deliver change well tend to have strong values and are consistent in their approach to driving performance and implementing change, their leadership behaviours and focus on long-term impacts. Not to be mistaken with personal style, which is always unique to the individual, behaviours can and should be consistent. Those leadership behaviours must support the values of the organisation and be specific to what the organisation does and how it works, and are relevant to everybody with people leadership responsibility, from executives to middle managers to team leaders.
“The worst behaviour you demonstrate is the best behaviour you can expect of others” is a powerful statement, because it is simple and true. An organisation cannot have multiple standards of leadership behaviour if it hopes to create a consistent way of working and a high performing culture delivering breakthrough performance.