The Limits of Lean?

Lean

Earlier this week I went to ‘An Evening with Simon Hill’. Drawing on his experience of manufacturing industry and Yorkshire Forward, Simon Hill, Executive Director of Business at Yorkshire Forward talked about strategic business improvement using ‘Lean Principles’. Simon chose not to offer a quick reminder of what these Lean Principles are – leaving a proportion of the audience in the dark. As a reminder they are:

  1. Specify what creates value from the customers’ perspective
  2. Identify all the steps along the process chain
  3. Make those processes flow
  4. Make only what is pulled by the customer
  5. Strive for perfection by continually removing waste

With its origins in the world of total quality management Lean Principles provide a wonderful way to ensure efficient product or service delivery by allowing the whole business process to be analysed and made efficient. It emphasises systems, compliance, analysis and objectivity in pursuit of the perfect process. It really is scientific management for the late 20th Century. It is one of several business improvement tools that can help an organisation with one of its purposes – that of the efficient delivery of a product or service.

However increasingly efficiency is not the only game in town. Indeed it is not even the main game for most organisations. Renewal, re-invention and transformation are increasingly the key drivers of sustainable value creation in modern knowledge based economies. If I heard Simen rightly then after a considerable investment of money and time in implementing Lean his business had just about managed to stand still. Now this is an great achievement for a manufacturer of automotive components in South Yorkshire – but I doubt if it carries the seeds for a major economic re-birth.

My concern is the ‘story’ that Lean tells about the nature of business and enterprise. That it is about analysis, rationality, incremental improvement and mediocrity – giving the customer just what they ask for – when they ask for it. It is that the expectations of the customer should drive the production of the organisation. And Lean is not just a set of tools – it is a management philosophy – a culture. It becomes the way we think and act.

Andrew Mawson – one of the UKs most outstanding social entrepreneurs tells of the first time he asked some members of his community what they would really like to do. It turned out that they aspired to go on a day trip to the coast. Fair enough thought Andrew and worked with them to make it happen. After the trip had been undertaken he asked them what they would like to do next? And the reply came – ‘Let’s go on another trip to the (same) coast’! Let’s do it again! Andrew recognised that the aspirations of his customers were narrow. That he could provide experiences far more powerful and effective in driving community development. He understood that they had no real idea of what was possible. So he proposed that their next project was to be a journey across the Sinai desert. As their supplier he transformed their ideas of what could be achieved based on his on his knowledge, experience and expertise. This would never had happened had been trained in Lean principles.

And now Lean Simon tells us Lean consultants are being engaged by Yorkshire Forward to increase organisational efficiency. No doubt pieces of paper will soon be travelling less far on their journey through the offices, being touched by fewer people and processes generally more efficiently. And many of the employees perceptions will be reinforced that their role is not to facilitate the entrepreneurial re-birth of the region – but to design and administer effective bureaucratic processes.

For me business is about emotion, aspiration, imagination, passion, energy and risk. I am not making an argument for waste (although I do often find myself encouraging clients to ‘create slack’) but I am arguing for cultures that favour action and re-invention over perfection. If the price of Lean is a culture that favours analysis and incrementalism over imagination, re-invention and risk taking then I for one find it a price I am not prepared to pay.

At the end of the presentation I asked Simon whether he really felt that Lean held the answers to sustainable competitiveness in knowledge based business – whether it could drive the creativity and innovation necessary to compete in the future. And he answered ‘ No!’.

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2 Responses

  1. really interesting piece Mike, thank you.

    I work for an organisation that exists to create more enterprising young people across the UK. While the Lean principles are clearly efficient management principles – they are not the answer to creating a more dynamic, entrepreneurial economy.

    I dont think that Lean principles necessarily need to represent a contradiction with enterprising skills and attitudes, but particularly in public service management, I do worry that the room for ‘risk’, innovation, and entrepreneurship is severly restricted by such a process-driven approach.

    Does anyone have any examples of where systems-thinking or Lean can work to create a culture of innovation and enterprise?

  2. Interesting thoughts Mike. This piece on the implementation of lean principles in HMRC may give fellow freelancers something to think about as they fill in their self assessment tax form this month…

    http://www.guardian.co.uk/commentisfree/story/0,,2233338,00.html

    Rob

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