A developmentalpathway to lean

Change Management in Lean ProcessesDrs. René L.M.C. Aernoudts

23th of June 2004

René Aernoudts• Chairman of the Lean Management Institute in the

Netherlands • Managing director of Sentary Coaching & Consulting• Background in Business Economics, Sociology and

Organisational Behaviour• Before founding the Lean Management Institute he was a managing

partner of a renowned consulting firm• Ran lean projects in banks, cities, a brewery, NGO (WWF),

supermarkets, a commercial research organisation, a printing firm, garbage recycling companies, governmental institutes, publishingcompanies and different manufacturers (fridges, toilets, electronics)

• His objective since 1998 is to bring lean and the typical results that come with it to service and non profit organisations

• Websites: http://www.leaninstituut.nl and http://www.sentary.com

A developmental pathway to leanWhere do I start? How can I run a successful lean project?What do I have to do to achieve sustainable results?What are the typical pitfalls? What’s the best road map for me?

Definition of Lean:• It’s not about cost cutting…!• It’s about creating more value for your customers,

stakeholders and employees!• To do this we need resources, and therefore we

eliminate waste! • Question to ask at the beginning

of a Lean Project: what are wegoing to do with the resourcesfreed up by this Lean Project?

Lean: more than a toolboxParadigm, Philosophy

Leading principles

Fundamental concepts

Leadership

Change process

Methods and instruments

Indicators

Behaviour

A lot of change processes fail• Research in the USA, the UK and the

Netherlands show that 70 to 75% of all change processes fail…

• Main reasons? The participating persons and the way change processes are designed

• Planned change is not enough to solve dynamic and complex questions

• Leaders (and consultants!) need to be aware of the fact that their own role and the way they steer a change process are the crucial success factors

• What about Lean Change processes???

A lot of change processes fail

A lot of change processes fail• Polarity Blueprint versus Developmental approach• Blueprint approach chosen by more then 80% of

management. Fail rate: 80%! Success rate: 20%!• Developmental approach chosen by less then 20% of

management. Fail rate: 17%! Success rate: 83%!• Why do managers choose a blueprint method? Mainly

because it seems to create certainty, communicates (/sells) easily and keeps the power at the top

• Is a blueprint method therefore worthless? No, it’s useful when technical and instrumental aspects are involved

• A developmental approach is more effective when the situation asks for a more radical change, not only in the processes or structure but also in behaviour

A lot of change processes fail

Uhu, a bit sticky though…

Good idea huh, painting the floor!

Assumptions of PCPlanned Change• Organizations as adaptive systems to market demands • Human beings as social capital to perform objectives• Employees motivated by personal advantage• Managers using position power in steering changes • Consultants as knowledge-driven experts• Organization life as source of shortcomings• Focus on economic measures of performance• New design of business processes • Top-down steering of change process • Solution-oriented based on value chain• Episodic change with stable end situation • Single linear change process• Techno-economical process rationality • Strict norms and planning in change process• Start with abstract business models• Emphasis on expert knowledge • Separation of design and implementation of changes • Learning as reflection by change managers• Knowledge development by using techniques

Assumptions of ODOrganizational Development• Organizations as purposeful socio-technical system • Human beings as creative and collaborative persons• Employees motivated by developing human potential• Managers using personal power in mutual collaboration • Consultants as process-driven facilitators • Organization life as source of experience• Focus on improvement of effectiveness and working life• Improvements based on the existing organization• Utilization of knowledge and insight of personnel• Problem-oriented based on working experiences• Continuous change improvement• Iterative change process • Social-political process rationality • Regard for ability to change in emergent change process • Start with concrete working experiences • Application of operational knowledge• Smooth transition between phases in change • Learning as a collective and ongoing activity • Knowledge development by action research

Combining the knowledge• We need Kaizen and Kaikaku: radical change

and continuous improvement• Build a Lean Development Structure, because

it’s often difficult to create change through the operational organisation

• Empower people at all levels by letting them play an active and crucial role as change agents or process owners

• Stimulate a Lean, Learning, Living culture

First thing to do: make a mapVivid picture of the futureLean Team

Illustrative examples

Key questions

Leading lean principles

?

Objectives (measurable

results)

Let’s make a start with a map!Vivid picture of the future

Illustrative examples

?Key questions

Leading lean principles

Objectives (measurable

results)

We’ve just started…Designing the process between the key questions and the vivid image of the future:

• Four phases and four levels• Structure of a lean development

organisation (time structure with roles)• Every development process needs a

process owner (change agent)• What are the leading lean concepts for your

situation and how to apply them

Designing the Lean Development Process

Some rules:• Involve persons concerned and interested

parties in the process• We only tackle problems that really arise• We take every advice serious and give

feedback to the person that gave it to us• From a discussion culture to an advice

culture• The realisation is the main course - not the

dessert

Four phasesMOBILISE &ORIENTATE

RESEARCH &EXPERIMENT

REDESIGN,IMPLEMENT

& EQUIPINTEGRATE &

ESTABLISH

Ask process ownersRun an introduction

workshopChoose a lean process

or a product familyVisit best practices

Set up the infrastructureMeasure the

CS figures

Plan and targets Analyse customerprocess and

interfacesDraw a current

state map

Create “short tracks” or quick wins

Just do and seewhat happens

Prepare a paper

Draw future state maps

Make a plan forimplementationImplement thechosen future

stateTrain personnelin the new ways

of workingMeasure the

improvements

New advice culture

Establish training

programmesStandardize

meetingsStart with newprocesses andset up projectsStimulate the new culture

Four levels

MANAGEMENT

PROCESS OWNERS

TEAM LEADERS

INDIVIDUALEMPLOYEES

INTEGRAL LEAN DEVELOPMENT PROCESSES

IMPROVEMENT PROCESSES PER DEPARTMENT

KNOWLEDGE TRANSFER, SKILLS AND BEHAVIOUR

VISION, STRATEGY, EMPOWERING, COMMUNICATE

Development infrastructure

MANAGEMENT

PROCESS OWNERS

TEAM LEADERSINDIVIDUALEMPLOYEES KNOWLEDGE TRANSFER, SKILLS AND BEHAVIOUR

IMPROVEMENT PROCESSES PER DEPARTMENT

INTEGRAL LEAN DEVELOPMENT PROCESSES

VISION, STRATEGY, EMPOWERING, COMMUNICATE

MOBILISE &ORIENTATE

RESEARCH &EXPERIMENT

REDESIGN,IMPLEMENT & EQUIP

INTEGRATE &ESTABLISH

Example Value Stream Map (1)Description Value Stream Map

Current StateAnalysis

Throughput time

Value AddedNon Value Added NecessaryNon Value Added Not Necessary

Type of process

Lay-out and visualisation

Types of waste

Communication

Planning & Control

Levelling tasks

Return on investment1,2,3 (A,B,C)

Bottleneckconclusions

Data and indicators

Example Value Stream Map (2)Description Value Stream Map

Future StateAnalysis

Throughput time

Value AddedNon Value Added NecessaryNon Value Added Not Necessary

Type of process

Lay-out and visualisation

Types of waste

Communication

Planning & Control

Levelling tasks

Return on investment1,2,3 (A,B,C)

Bottleneckconclusions

Data and indicators

Managing a lean process

Confusion

Fear

Slow change

Frustration

False start

REALCHANGE

Vision Skills ResourcesActionPlanIncentive

Vision ResourcesActionPlan

ResourcesActionPlanIncentive

Vision ResourcesIncentive

Vision ResourcesActionPlanIncentive

Vision ActionPlanIncentive

Skills

Skills

Skills

Skills

Lean road maps

Lean road maps

Where do I start?By asking yourself the right questions! Why do I want to achieve with this Lean Project?Create a crisis…Communicate examplesVisit other organizations a few steps ahead and way beyondTransferring knowledge Ask a team and start mapping!

How can I run a successful lean project?

Follow the principles, start with the first one, although it isn’t always easy!Get some helpCreate a road mapMake your own instruments and your own business systemIncorporate people with concrete tasks

What do I have to do to achieve sustainable results?

Involve personnelCreate quick wins and communicate resultsShow the improvements from the employees perspectiveCreate a supporting infrastructureYou are the living example, be aware of your own actionsBeware of the hype of the month

What are the typical pitfalls?

Failing Leadership!Bare in mind the while managing: incentive, vision, action plan, skills and resources… It’s a golden formula without any hard work to do…We have so many other things to do that take up our time, energy and money…

What’s the best road map for me?

You saw some but…Make your own map!Share this with a few colleagues and consultantsJust go out, do it and have fun while you’re at it!

Thank you!