This month I have a featured article in Kevin Meyer’s Superfactory Newsletter. I’ve been a subscriber for many years, and Kevin does a great job.
My contribution is titled 25 Problems..or how to focus on the right systems. I hope you’ll give a read, and sign up for the Superfactory newsletter.
I haven’t contributed to Superfactory since 2003 (far too long) when I wrote both Beyond Lean and Connecting Lean and Organizational Learning.
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Should you start lean in a difficult period such as this? But shouldn’t I wait things out? Shouldn’t I take it slow? Or keep my head down? No. I think this is a great time for companies to be focused on a lean journey. Here are my reasons.
So stop waiting for the “right time.” There is no perfect time. Now is as good as it gets. Get started. Go to a class or read a book. And then take action.
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First, let me state that I don’t celebrate failure. But I do, as I wrote about last week in Fail, Learn, Lead, celebrate the learning that comes from failure.
Blogger Jason Markow started the idea of #FAILweek with the idea that people can share their failures, their lessons from failures, their thoughts on failing. That’s way too many fails for me. But I want to share my most successful business venture failure. Why successful? Because I didn’t lose 1 cent.
Monsoons
Several years ago myself and a few others had the idea of starting a new, franchise-able (a word?) restaurant. It was to be called Monsoons. We even had a logo, where my own weak artistic capabilities demonstrated its limits.
But we had much more than that. We had a chef, and a menu. we had an architect, and a design. And a darn fine design at that. We had a footprint plan, a franchise plan, and a financial plan. We had scouted and negotiated leases on several potential properties to launch with.
This was to capture the growing segment of fast casual, being able to eat with the convenience of fast food but the quality of a casual dining experience. It was to be pan-asian, taking advantage of an underrepresented market.
It wasn’t dissimilar to what Pei Wei is today, where I ate last week just to try it, and thought it was quite good. [That certainly doesn't mean that we were right, just that this was some of what we had in mind.]
And then everything ground to a halt. The project died. And we moved on.
The Failure
We failed. The business stopped. The reason, without getting into particulars, is that a key strategic decision had to be made about the method of starting and ramping. On this key decision, we had very different, but deeply held views. They were deeply held enough that there was no moving forward. Only brute force would have allowed some decision. It became clear, through the insights gained during this decision, that there were other beliefs that support it that would probably mean we would struggle again. It meant the business was dead, but for the right reason.
The Success
What made this a successful failure is that we had gotten this far without spending a single dollar, a single cent. Everything was done with the currency of relationships and the asset of hustle. People worked with us with the understanding that no promises were being made, other than the one that if this went forward, they went forward with us. We collaborated with people with the idea that if nothing happened, more opportunities would come along down the road. And in the end, everyone learned something about the restaurant business, architecture, marketing, real estate, or franchising.
The Lesson
There is nothing more important than having aligned principles among founders.
If one of you believes in the quick build and flip, and other in a sustainable organic growth model, every decision will be met with strain. If one of you believes in extreme outsourcing, and the other in extreme vertical integration, progress will freeze. If one of you believes in lawyering up, and other believes in handshakes, inconsistencies will mount.
There are a lot of differences that you can get over among a group of founders whether 2 or 10. You can come from different countries, different generations, different education levels, and socio-economic backgrounds, and you can be successful.
But if you don’t approach the business with the same fundamental principles, the best business plan in the world will not save you.
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I have a new post published on Assembly Magazine. See the full article on that site.
A great lean thinker has a lens for value….
This article originally appeared in Lean Progress, the quarterly newsletter of the Lean Learning Center available to subscribers. I also started this thought with a brief video blog in November.
What’s your definition of lean? There are many. Personally, I think you shouldn’t focus too much energy on developing definitions. Perhaps the most common definition however is “doing more with less.” It’s cute, short, and to the point. It’s says a lot, but still leaves a little to the imagination.
What do you hear when you see that definition? Most organizations hear “with less.” Particularly through the latest economic downturn, many organizations have been focused on reducing costs and even reducing their overall organization including their assets and people. This might be a situation you find yourself in.
Because you have been particularly focused on cutting and saving recently, it is easy to focus on lean being about less. I believe people are focused more on the “less” part of that definition. This of course is important because “less” is where you get the cost down and the waste out of the system. Numerous lean methods are designed primarily for this purpose such as waste walk, kaizen events, standardized work, and most value stream mapping efforts. But the “more” part of that statement is equally important. It is “doing more” – so what is the more. It should be defined as providing more value, having more capabilities, and being stronger. The true vision of lean should not be stripped down, it should be strength.
In the human body, lean is not the model that is skin and bones. Think of the image of the supermodel or Hollywood starlet. Yes, there is very little fat, but that doesn’t make it healthy. Instead, the example should be the Olympic swimmer or gymnast. This is a person who is built for purpose and performance. It is also low in fat, but it is also very healthy. It is very strong.
Consider the same difference for your organization. Build your organization for performance. Focus on how you can provide more value for your customers, both inside and outside the organization. Focus on how you can build more capabilities, more skills, more robust processes.
One way you can do this is to turn your waste into value. Consider the lumber industry as an example. For centuries really, creating lumber produced a wasteful byproduct of sawdust and wood chips. However, through innovation, this throwaway was turned into value-added products such as particleboard and wood pellets for stoves. Look at the waste streams – what can you salvage that can provide value.
Another way is consider your organizational capabilities. Perhaps the only truly sustainable competitive advantage is your intellectual capital or people capabilities. Are you fully developing these? Every project and every improvement that has a performance objective could also have a learning objective. Maybe you reduced some cost, but you also grew the capabilities of a person. IF you manage learning objectives, you can build new strength while taking out waste.
Lean is “doing more with less” but it is both sides of this equation that really matters.
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On our LinkedIn Group for the Lean Learning Center, we get many good discussions and questions. We had one from Roger Cook that I thought was worth repeating and expanding upon. Here is the question:
I’m curious if any of you have foolproof ways of insuring your metrics (which lean folks are famous for measuring everything) are actually measuring what you think they are.
The genesis of this question is my experience with Toyota, itself. I own 2 Toyotas and have them serviced at a Toyota dealership every 5000 miles. Each time, as I’m leaving, the service attendant tells me I am likely to get a questionaire from Toyota rating the service I just received, and would I please rate them excellent because this is the only acceptable answer. They obviously get graded on the results of these questionaires. Its a little alarming to me that a company as famous as Toyota is for metrics and lean, wouldn’t see that their survey results are not more than a little biased if the only acceptabale answer is excellent. Or am I the only one to see a bit of irony in this situation?
There are actually a couple of different levels at which I would like to answer this question. First, on the challenge of the dealership. And second, on measurements.
On Dealership, and Why Your Customer Doesn’t Care Whose Problem It Is
Roger’s example makes a great point. Your customer doesn’t care if the problem they experienced is with you, the supplier, the retail outlet. If Amazon puts wrong information on the product page, it reflects badly on you? If your supplier ships you defective components, your customer doesn’t care that it’s their fault.
If Wal-Mart sells a faulty product by Dell, it hurts both their brands. If Wal-Mart delivers faulty service when selling the Dell, it hurts both their brands. How does this apply to Roger’s problem, or Toyota’s?
Dealers are owned by the same people at Toyota as they are at Chevy. You get a wide range of service levels, behaviors, and attitudes, many of which Toyota would be and are ashamed of. With Roger’s specific situation, it gets worse than that. There have been cases in the past where dealerships hold banquets and other nice events for customers. The price of admission: an incomplete survey. Then the dealer would complete the surveys themselves. I’m not sure if this is quite illegal, but we don’t need to debate how far it crosses the ethics lines. Fraud of course destroys the integrity of any measurements, to Roger’s point.
The Fallacy of Measurement as King
Measurements are important. They serve a useful purpose. When I visit an organization to perform an assessment and find they have almost no measurements, I can bet the organization won’t be very strong. Facts and data are not the same thing, as Mark Graban commented on.
Any time a measurement is tied to an incentive, then it is likely to be manipulated at some level. If my pay is tied to the rating at the dealership, then the small step of asking you to rate them excellent seems worth it, because most people don’t knowingly stick it to the person that just helped them. When this happens to me, I usually lower my score and comment that I was asked to rate them a perfect score.
To answer Roger’s underlying real question about ensuring metric accuracy, the only real way that I’ve found is direct observation. Metrics are abstractions, by definition. That means they never truly represent reality. That means they are subject to manipulation, intentional or otherwise. To truly understand what is going on, you must get past the abstract and see what is truly happening.
We talk about direction observation in The Hitchhiker’s Guide to Lean . Many “lean” people talk about going to the gemba, which means “actual place.” But it takes more than going to the actual place. It required observation. This means study. It means patience. And it requires that you have the ability to digest, understand, and add meaning to what you see.
Don’t throw out your measurements. Just know that they don’t give you the whole story. Take the time to understand the current state as it actually happens, through direct observation.
You can find great conversations about topics such as these on the Lean Learning Center LinkedIn Group. While on LinkedIn, search for Lean Learning Center under Groups and sign up.
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This is our second video in our Cultural Transformation video series.
You can’t change everyone in your organization in a thorough manner in an instant of time. You have to chip away at cultural transformation piece by piece. So what’s better? Should you go an inch-wide and a mile-deep or go a mile-wide and an inch-deep? In The Hitchhiker’s Guide to Lean, we refer to the Lean Learning Laboratory, which is a process we created to help make that inch-wide, mile-deep approach work. Here my thoughts in this video:
Please share some of your comments and your experiences.
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How often do you sit in a different seat at the dinner table? A regular meeting? A plane? When I travel, often starting on a regional jet, I’m usually in seat 1B. Not 1A, or 2B, but in 1B. It’s where I’m comfortable. Of course, my objective is to be comfortable. If my objective were to learn, this would be a bad strategy.
My brother Mike has been a high school teach of rhetoric and English is now an instructional coach for other teachers. On his blog Flinchclass.com, he shares the effect that switching seats in the classroom can have:
Much of our long-term memory is episodic. The brain stores time/place memories in the hippocampus, and when information—the content of your course—is attached to those episodic memories, it is easier for the brain to store and recall. When we think about important events in our lives, we almost always return to a physical setting. Third grade in the seat by the window—watched the balloon I got for my birthday sail into the sky because my mother, who was cleaning, accidentally let it slip out the door. Mid-afternoon sitting in the corner of the bench beside the front windows of my high school—discovered Holden Caulfield narrative voice in Catcher in the Rye. Recalling those places helps us recall the events or information we associate with them.
I can remember more than anything from high school where I sat and who I sat behind, often because I was talking with that person when I was supposed to be paying attention. Because we never did change seats, and perhaps also because I wasn’t always paying attention, I remember this more than I remember the lessons.
Last week in a board meeting when several of us walked in we said “let’s sit somewhere else and change things up a bit.” We had been sitting in the same seats meeting after meeting. It did indeed affect the conversation and change my perspective, and was glad we did it.
Here’s what you can do;
1. In your next meeting, get there early and sit in a different seat, particularly one of those from someone else that comes early. They will have to do the same, and the whole meeting will be a bit less habitual and more attentive.
2. If you are running a class, whether high schoolers or executives, change up the seating. Whether they do it on their own at your request, or you purposely arrange their seating, change it up.
3. Change the perspective also by changing the location of the meeting, or do it standing up. This will also break the cycle and create a new perspective.
4. If you really want to get a point across from someone, meet in a new and unique location. Go offsite, or find a special spot. Pick someplace that will stand out, and then your critical conversation will be reinforced by the memory of the physical environment.
If you’d like to continue learning and change your perspective, you can change your inbox. Enter your email in the box at the upper right and continued receiving this content via email.
If you’re on Twitter, you know of the tradition of the Friday Follow where you share who you follow so that others might benefit in the same way. I think the same think should apply to blogging. So I occasionally post a Bloggers Friday Follows of interesting bloggers that I enjoy reading, and enjoy learning from. So far, I’ve covered the following lean bloggers:
Today I turn my attention to a different kind of lean blogger, Eric Ries and his Startup Lessons Learned. Eric is an experienced entrepreneur also with venture capital experience, and has popularized the idea of the “lean startup.”
Obviously, I have been interested in lean for a long time. I have also been involved in startups, as practitioner, advisor, investor, teacher, and coach, even acting as an Entrepreneur-in-Residence at Lehigh University. I’m fascinated by how lean concepts can apply to entrepreneurship, and did write one blog post on the subject.
Eric is out on the road talking about and writing about lean in startups. His experience and therefore perspective is decidedly software and Silicon Valley, and as a result I’m sure the catalog sales business, clothing startup, and local restaurant might read it and think “huh??”. But the lessons apply to all, you might just have to think a little harder about the application in your own space, which quite frankly is good for you to do anyway.
I’m not going to summarize all of Eric’s points here. You can read his blog which I am encouraging you to do, watch a video of a speech at Stanford, or even read Mark Graban’s summary from talk that Eric gave.
Here are some posts by Eric that I particularly recommend:
The words entrepreneur and startup have been tossed around quite a bit the past few years, from Tim Ferriss’ The 4-Hour Workweek
I hope other bloggers contribute to the idea of the Blogger Friday Follow. I don’t care what day it is, but who do you read, and why.
Recently I posted the first video series on Cultural Transformation and described the formula H x V x F > R. I received a response on a different formula, which we turned into a guest post by Rob van Stekelenborg. Rob is working with IG&H, a Dutch-based consulting firm that “makes strategy work” for their clients. Previously he was in senior operations roles at Areva and Valeo in France, and GE and Philips Electronics in the Netherlands. You can follow him on Twitter and LinkedIn. Here’s is Rob’s contribution..
T = (C x I) / R
Lean transformations typically require interventions on both content (technical) and cultural aspects (attitude and behavior) and these together initiate and drive the required change. When assisting clients on their Lean journeys, my focus is on this triangle of content, culture and change. However, this change does not happen just because you intend it. As many have learned, people don’t change because you want them to change. But they don’t dislike change either. They just don’t like being changed. For a successful and sustainable Lean transformation, Trust (T) needs to be built between leadership, managers and the workforce, but also between any support staff or consultant and line management. Trust is required in order to be accepted as leader, coach or Lean guide.
To build trust, three elements are of importance:
C is for Credibility. Previous experience, competency, logical thinking, (pro-active) references, reputation and credentials all build your credibility. You need to create followers on your Lean journey. Without credibility you will not be able to take up your role as a guide on that journey.
I is for Intimacy and represents the closeness you need to create with the teams and their leadership that you will guide. Without good relationships, you will not be able to create the openness required to discuss the real problems in the organization
R, lastly, stands for Risk. No journey is without risk, and as a guide you will need to be able to identify the risks, be frank about them, and propose appropriate countermeasures well before risks materialize. You always need to think ahead, for the pitfalls around the corner and guide the organization around them.
For anyone, to be accepted in a role of leader or guide, you need to work on all elements that will build trust. Trust that is required for people to follow you. They need to believe you based upon your credibility, be open to you based upon good relationships and at the same time you need to eliminate or at least reduce the risk people perceive when they join you on the Lean journey.
Have a good journey!
Jamie Flinchbaugh helps individuals and companies execute to their ideal state.
He is an entrepreneur, speaker, author, executive coach, consultant, husband, and father.
