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About the Author

Mike Lougherin
CEO
Transformance Advisors

 

Mike Lougherin is an expert in the creation of sustainable lean organizations and a certified coach for the Six Disciplines strategy development and execution program. He brings exceptional experience in both industry and consulting services and has helped organizations such as Levi Strauss & Company, Hewlett-Packard, Warner Home Video, Sweetheart Cup, and Alpine Electronics improve their performance.

 

As a frequent speaker at various educational events, he provides informative and energizing presentations by leveraging his passion for excellence.


Supply Chain Comment

By Mike Loughrin, CEO of Transformance Advisors

January 3 , 2012



Supply Chain Comment: Designing a Lean Transformation Program

What Separates Lean Leaders and Laggards?


Lougherin Says:

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Lean is number one because it has a rich history of success. Those that focus on the systematic elimination of waste supported by a comprehensive approach are the leaders
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It seems like everyone is working to make their organization's lean!

And in fact, many organizations are improving performance and changing their culture through effective lean transformation programs. In contrast, other organizations are simply using a few common techniques from the lean tool box. Sadly, they are just scratching the surface and are far from reaping the big rewards available to those taking a comprehensive approach. There are also many organizations where solid lean programs exist in one functional area, but senior executives have not seen the possibilities, or they lack the courage, to expand lean to all functional areas.

Common Elements

To understand the gap between the leaders that are achieving big gains and the laggards that are taking small steps, let's explore the common elements of lean transformation programs.

Our research and experience indicates the following four ingredients are key indicators of success:

Methodology: Lean is defined as the systematic elimination of waste. A critical aspect is the systematic approach defined by the five principles of lean (specify value, identify value streams, create flow, leverage pull, and seek perfection) and inherent in the techniques found in the lean tool box.

Measurement: While research identifies creating a sustainable lean organization as the top priority, the second priority is having the ability to measure the cultural transformation. It is important to measure both the improvements in your value streams and the cultural changes within your organization.

Community: The power of a community is the ability to share best practices and drive the development of new techniques. There is great opportunity to learn from other organizations that have addressed similar challenges and then "give back" by helping others.

Coaching: There is no need for anyone to recreate the wheel. It's best to leverage the experience or internal and external resources with the skills and experience you need. In addition, educational programs, assessment tools, and program management templates are all available to speed the process and increase return on investment.


Leaders vs. Laggards

Using these four indicators of success, let's examine the differences between the leaders and the laggards:

1. Methodology

 Leaders

The leaders take a very systematic approach when applying the five principles of lean and leveraging key concepts such as the seven types of waste. Tools such as value stream mapping have prescribed steps that, when followed, produce excellent results and allow an organization to develop a culture of continuous improvement.

  Laggards

The laggards find one or two techniques from the lean tool box that seem easy and they overuse these techniques in an attempt to cut costs in a chaotic manner. Not following the systematic approach built into each lean tool will often result in an unsatisfactory outcome.

 

2. Measurement


Leaders

The leaders will assess all of their value streams and then focus attention on areas that need improvement. They will measure performance and celebrate improvements. In terms of the cultural transformation, the leaders will conduct periodic surveys of employees to measure progress and make course corrections as needed.

  Laggards

The laggards will not begin with an assessment of their value streams; they tend to focus attention on symptoms. For example, they might work to "fix" the forecasting process instead of reducing cycle time in order to eliminate the need for item level forecasts. Tracking the cultural transformation is not part of the plan for most of the laggards.

 

3. Community

 

Leaders

The leaders will join the lean community and be visible at lean educational and networking events. They will seek to learn from others and will also host tours or give presentations as a means to "give back" to other like minded organizations.

  Laggards

The laggards will not have the time or money for attending lean educational and networking events. Most will not have success stories they can share and they cannot benefit from the concept that it is better to give than to receive.

 

4. Coaching

 

Leaders

Leaders understand that the techniques from the lean tool box are systematic and how they are most effective when people are coached to use them correctly. Large organizations tend to develop internal full time lean experts that can help others get started with improvement projects. Many small and medium organizations will leverage experienced consultants that can coach their employees with an emphasis on "teaching them how to fish."

  Laggards

Laggards tend to learn by skimming articles and viewing a few webinars. They stick to one or two techniques from the lean tool box and usually perform the easy to understand steps while skipping those that seem difficult. Another popular method is to hire a lean expert – everyone knows that lean is number one and everyone has it on their resume! This approach can work very well if you hire someone with experience at one of the leaders. It can be a disaster if the so-called lean expert used to work for another laggard and has left a wake of mediocrity behind them.

Summary

Lean is number one because it has a rich history of success. Those that focus on the systematic elimination of waste supported by a comprehensive approach are the leaders. Those that chase cost cutting in a chaotic manner, without the desire for a cultural transformation, are the laggards.

The return on investment between the leaders and the laggards are great. However, there is good news for the laggards. They can get on the road to success by leveraging the four critical ingredients of lean transformation programs.

We do not need leaders and laggards! Through a comprehensive lean transformation program, all members of the lean community can win with lean.

 

 

 

 




Agree or Disagree with Our Expert's Perspective? Let Us Know Your Thoughts at the Feedback section below.

Recent Feedback

I like your distinction on Measuring.  Leaders measure project progress AND cultural transformation progress. Successful Lean Transformation is rooted in 'What's in it for Them' (WIIFT) instead of 'What's in it for Me' (WIIFM).  If an organization attempts to accelerate a Transformation or ignore the cultural 'drain' they're creating with their Transformation they will ultimately hit a 'glass ceiling' with their Project Results.  Continuously pulsing the organization for their progress in the Lean Transformation is critical to success.

Very good point and a measurement opportunity OFTEN overlooked when designing a project and a Transformation!


Doug Klapperich
Strategic Commodity Manager
Avago Technologies
Jan, 11 2013

Ouch!  Mr. Loughrin's extensive experience serves us well.  Too often I have seen organizations not follow a systematic and comprehensive process, but instead chase symptoms with a few lean tools.  


Thom Mandl
Business Advisor
G2G Consulting
Jan, 12 2013

I like the way you state the four key ingredients as indicators for success. And how you compare the leaders and the laggards. You start with stating that it looks like everybody is working to make his or her organization lean. To my belief that is true, and the big difference between the leaders and the laggards is that the leaders implements LEAN, and the laggards are working on "lean and mean", and they even use it as the name for their program. Very often the laggards use "lean and mean" as a cost cutting program amd excuse to right size the organization, instead of a continuous improvement program. Lean leaders are guided by a vision and the laggard's compass is the fear of losing market share.

Mike, thanks for sharing your insights. It presented me a thoughtful moment.


Wout Verwoerd
CEO
Verwoerd Consult
Jan, 13 2013

This is a terrific article and really hits the nail on the head.
 

Great comparison with Leaders and Laggards. Laggards tend to want to take the easy way out and as Mike points out the cultural transformation will not happen or sustain.

By far one of the best articles I've seen in Supply Chain Digest. Keep up the good work.


Gary Wickett
President
GW Lean Engineering
Jan, 14 2013
 
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