Shorter Hours Is the Kaizen Mindset

Are businesses finally starting to question the assumption that more hours at the office equals more value for the customer?

Back in November, I mentioned that the New York Times and the Wall Street Journal both ran articles on the productivity benefits of reduced work hours. Not to be outdone, NPR reported that Microsoft Japan moved to a four-day workweek this summer while increasing productivity by 40%. 

Last week the Wall Street Journal hit the topic again. The essay, adapted from a new book by Alex Soojung-Kim Pang, adds more anecdotal evidence that reducing work time doesn’t undermine the ability to deliver customer value, and it’s better for workers. As the author points out, 

“Making the change [to shorter work hours] spurs staffs to collaborate more effectively, prioritize more ruthlessly, and develop deep respect for one another’s time. Leader gain time to scan the horizon, incubate new ideas, and recover from their weekly pressures.”

Jon Miller of Gemba Academy is skeptical that a four-day workweek is the future of work. Among other issues, he points out that four days is an arbitrary number (Why not three days? Why not two?), and that it seems to apply better to knowledge work than to, say, trucking or construction. As usual, Jon has excellent points, and he might be right.

I don’t know whether four days is the right number either. But what everyone seems to be missing is that reducing weekly work hours (in an office or a factory) is a perfect analog to reducing inventory levels. Just as reducing inventory uncovers problems in a process, reducing hours has the same effect. 

A four-day workweek is a forcing function. It reveals the gap between the current condition and the target condition. When people have to work, say, 32 hours instead of the scheduled 30 hours (or 38 instead of 35), workers must confront and resolve those issues that keep them at the office or factory longer than the target time. They have to eliminate the non-value added activities that typically consume large chunks of a worker’s day—think flabby meetings, worthless emails, pointless administrative tasks, unnecessary firefighting, etc.

We have to recognize that more working more hours doesn’t mean creating more value. We have to move beyond the expectation that working nights and weekends is an immutable law of nature. 

Let’s expand the kaizen mindset and start looking at the way we consume our only truly non-renewable resource: time. 

Why Ping-Pong Post-It Notes Are Bad For You

One of my clients, a physician in an academic medical center, has been struggling with her personal kanban. She avoided all the common pitfalls—she kept finished tasks in her Done column, limited her WIP, and used Super Sticky Post-It notes to ensure that she didn’t lose any work to evening janitorial services. But she wasn’t making a whole lot of progress, which left her was frustrated with the kanban—it wasn’t helping her manage her work.

A closer look at the Post-Its revealed the problem: giant tasks (projects, really) that had no chance of getting finished in anything less than a few months—in her case, “Work on R-01 Grant,” “Write New Oncology Paper,” “New Patient Intake Protocol,” among others. If you were to scale a note to the size of the task written on it, these should have been about the size of a Times Square billboard, not a 3x3 Post-It.

When you put projects of that size on a single Post-It, you’re setting yourself up for failure. It gets stale. It stays in the “Doing” column for so long that it turns into wallpaper, and eventually you stop seeing it. Alternatively, you ping-pong between “Doing” and “Backlog” every time you start working on the task, abandon it for other priorities, and then pick it up again a few weeks later.

Either way, it’s demoralizing and demotivating. As Teresa Amabile and Steven Kramer discovered in their book, The Progress Principle,

Of all the things that can boost emotions, motivation, and perceptions during a workday, the single most important is making progress in meaningful work.

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When you can march tasks through the kanban columns, you experience the progress that’s essential for motivation. But when you have a single, giant Post-It note sitting in your Doing column for longer than it takes to read Moby Dick, well, you’ve got a problem. 

You need to size your kanban tasks so that you have a fighting chance to keep your important work moving forward. At the same time, you have to make them significant enough to avoid being caught in a quagmire of meaningless trivialities. Sure, you do need to return a phone call from your boss and an email from a customer, but that’s probably not the best use of your personal kanban. Try sizing the tasks to be larger than 30 minutes but smaller than a week, and see what happens.

When Leaders Torture Their Employees

Pity the employees at a Starbucks in midtown NYC. In a misguided attempt to improve quality, the management posts monthly scores on a variety of metrics. . . without understanding anything about effective use of metrics. 

In this photo, you can see the percentage of customers who responded “Strongly Agree” on questions related to store cleanliness, order accuracy, food taste, connection, “going above and beyond,” and other areas of concern. 

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Measurement is a good idea, but only if it’s done well. These measurements? Not so much. 

If you read Mark Graban’s blog or book, you’ll immediately see problems with this chart. For one thing, three data points don’t make a trend. With no upper and lower control limits, the movement in scores is nothing more than management by emoji — we have no way of knowing whether the movement is just random noise in a stable system, or a real signal indicating something significant happened. And why are they looking at the scores monthly? By the time they see a decline, it’s far too late to figure out what the root cause was and how to address it.

Imagine the monthly meetings with team members, where management demands to know why the “Connection” score dropped from 32 to 29 between November and December. How could anyone answer that question intelligently? 

At best, reviewing the scores is a waste of time, forcing people to “write fiction”—concoct a justification for something that’s almost certainly random and unknowable. At worst, it’s employee abuse, given that they might very well be evaluated (rewarded or penalized) for these scores. 

Starbucks: if you’re going to measure performance, then do it properly. Don’t waste management’s or associates’ time with pointless exercises that doesn’t help anyone to improve.

That’s just torture. 

Just the Facts, Ma'am

Taiichi Ohno said, “Data is of course important in manufacturing, but I place the greatest emphasis on facts.” You can leave out the word “manufacturing,” and apply the concept to anything in your company or your life. Facts are more important than data. 

When he talked about his preference for facts over data, he was urging people to go and see for themselves. Gathering facts comes from close observation of people, of objects, of spaces. 

By contrast, spreadsheets, reports, and anecdotal accounts are not facts. They’re data. They’re two-dimensional representations of reality, which makes it easy to jump to conclusions. 

Data tells you how often a machine breaks down on an assembly line. Facts—direct observation—show you that the machine is dirty, covered in oil, and hasn’t been cleaned and maintained in a long time. 

Data tells you that customers applying for a mortgage forget to fill out certain parts of forms, forcing bank employees to follow up with customers and delaying the underwriting process. Facts—close examination of the form, and direct observation of an applicant while filling out the forms—reveal that one of the forms is poorly laid out and so cluttered that it’s easy to overlook a box.

Data tells you that the employee attrition rate is higher than industry average. Facts—spending a day in the office where people work—show that the office is kind of dark and unpleasant, that there’s no space for quiet reflection, and that the company you outsource facility services to doesn’t do a good job of cleaning the bathrooms.

Data without facts gives you an anemic, two-dimensional, black and white view of the world. Facts without data give you color and texture, but not the detailed insight you’ll need to solve the thorniest problems. 

Facts will till you to clean and maintain the machines on the assembly line, but data will help you figure out how often you need to do it to ensure quality. 

Facts will tell you that you need to improve the layout of the mortgage application forms, but data will tell you what the new error rate is, and by how much you’ve improved the materials. 

You need both facts and data to get the full picture.

Boeing Starliner Failure: Lessons for Your Lean Program

Boeing’s Starliner failed an important test flight two weeks ago. It was supposed to rendezvous with the International Space Station, but was unable to reach the correct orbit.  

The problem with this engineering marvel? Not the complex aerodynamics, not the critical separation from the Atlas V rocket, not the all-important re-entry heat shield. 

No, the problem was with the internal clock. The spacecraft’s internal clock became unsynced with the overall “mission elapsed timing” system, so the Starliner failed to fire its engines at the correct time to reach orbit.  

So—a $5 billion project was undone by something that your $10 Casio watch could handle. 

Does your lean program face the same problem? I’ve seen companies create a Kaizen Promotion Office, develop a comprehensive Lean Six Sigma Black Belt training curriculum, and invest in expensive andon systems, but they’re not making any real progress towards their business goals.

Why? The problem isn’t with this expensive “technology”—the people in the KPO, the course materials, or the andon lights. It’s with the simple synching of front line workers with the leadership. 

Front line workers grapple with daily (and hourly) production problems, while leadership is too busy to go to the gemba and learn what’s actually happening. Front line workers focus on meeting takt time, while the C-Suite leaders are sequestered in conference rooms or traveling. Without regular contact, leadership will inevitably become unsynched from the critical work of the organization. 

Read any story about a successful lean journey, and you see a common thread: the leadership team spends significant time in the gemba. The VP of manufacturing at Sage Fishing moved his desk out of his office and onto the shop floor. Jim Lancaster of Lantech spends 90 minutes daily walking the gemba. Rich Sheridan of Menlo Innovations sits in the same open room as all his employees. Etc., etc. 

Don’t get unsynched from the work being done. 

It’s Not “Time Management.” It’s Lean.

In the space of two weeks, the New York Times and the Wall Street Journal both ran articles on the productivity benefits of reduced work hours. The WSJ introduced us to the workers at Rheingans Digital Enabler in Germany, who only put in five-hour days, for a workweek of 25 hours. The same is true of employees at Tower Paddle Boards (at least during the summer months) and Collins SBA, a financial advisory firm in Australia. 

Not to be outdone, NPR reported that Microsoft Japan moved to a four-day workweek this summer while increasing productivity by 40%. Of course, software firm 37 Signals has been operating four-day work weeks over the summer since 2008. And New Zealand-based Perpetual Guardian believes in the four-day week so strongly that the founder created a non-profit to promote it. Indeed, a recent survey by the Society of Human Resource Management indicates that fifteen percent of companies offer a 32-hour workweek. 

Unfortunately, companies in the lean community don’t seem to take much note of, or try to copy these experiments, probably because the benefits aren’t reflected on the income statement or balance sheet. Overtime expense isn’t a major concern when many office workers are on salary. There’s also no scrap, no defects, and no late deliveries to erode financial performance. 

Cynics might attribute the productivity gains as a demonstration of Parkinson’s Law, which states that work fills the time available for its completion. There’s certainly some truth to that argument. But that simplistic analysis ignores the way in which reducing working hours is very much in keeping with lean thinking.

The classic Toyota metaphor about lowering the water level to reveal the rocks is typically used in relation to manufacturing. By lowering kanban levels, Toyota reduces work in process inventory. This reveals problems as they arise, and forces workers to confront and resolve problems in real time.

These companies are really doing the same thing: they’re reducing the critical resource available to knowledge workers—in this case, time—which forces them to work differently. The only way for them to deliver the same value in fewer hours is to eliminate the non-value added activities that typically consume large chunks of a worker’s day—think flabby meetings, worthless emails, pointless administrative tasks, unnecessary firefighting, etc.

Rheingans Digital Enabler’s approach is to ban social media during work hours, make most meetings 15 minutes long, and ask people to keep phones in backpacks. Menlo Innovation carefully schedules software production in predictable two-hour, four-hour, and eight-hour blocks. Cleveland Clinic, as well as the IT department at Nationwide Insurance, use a tiered huddle system to drive problem solving down to the lowest possible level and reduce the need for firefighting. 

Of course, every situation is different and will require a different approach. But the reduction in office hours can be the stimulus for creative thinking about how to increase productivity and efficiency. The evidence from the experiments run by the companies in these articles indicates that it’s a fantasy to pretend that an additional eight or 15 hours of work per week will be highly productive. 

If nothing else, remember that reducing work hours embodies the principle of respect for people. Humans have a limited capacity for cognitively demanding work—we can only focus for so long before our powers of concentration wane. We need time off to rest and recover. We need time away from work to recharge with friends and family. And that may be the best reason of all to try a shorter work week. 

Please, Not Another Argument for MBWA

Theodore Kinni argues in Strategy + Business that leaders must practice management by walking around (MBWA), a concept popularized by Tom Peters and Bob Waterman in their seminal book, In Search of Excellence. That’s the best way for them to stay connected to their businesses and understand what’s really happening with their customers. As Peters puts it, “The real meaning [of MBWA] was that you can’t lead from your office/cubicle.”

I’ve got no problem with the concept—after all, it’s similar to the lean precept of genchi gembutsu, or going to the gemba.

But here’s the problem with MBWA: it’s essentially unstructured. In fact, Peters and Waterman specifically advise managers to make their walks unpredictable, both in terms of where they go and when they go. The CEO is supposed to just wander around and, without notice, randomly pop into people’s workspace like some sort of benign animatronic ghost from a Disney World ride. Peters and Waterman believe that if front-line workers are expecting your visit, you won’t see what’s really happening on a regular basis. They argue that front-line staff will work differently; they’ll clean up their work area; they’ll cover up small problems. As a result, leaders won’t get an accurate picture of how the processes are operating.

This is a fundamentally different perspective from the one held by the leaders at organizations embracing lean. James Hereford, CEO of Fairview Health Services in Minnesota, schedules his gemba visit to each medical service every morning—and everyone knows which department he’ll be visiting that day.

Varsity Facility Services, a national provider of janitorial services to corporations, actually posts managers’ schedules in the open, visible to the entire company. When a manager completes her front-line visit, her team checks the box or flips a card from red to green to show that she did, in fact, fulfill her commitment to the team.

Jim Lancaster, president of Lantech, does his “walk-around review” (WAR walk) with his leadership team from 9-9:50 a.m. on Mondays and Fridays. They visit each department in the company in a standard sequence.

Imagine what would happen if your physical trainer followed the MBWA playbook, and he came by unannounced to ensure that you’re following your training program. In the best case, you’d be confused (Why is my trainer at my front door at 6 a.m. while I’m still in my underwear?), and in the worst case, you’d feel disrespected (What—he doesn’t trust me to do my workout?).

Conversely, imagine that you have regularly scheduled training sessions with your coach and that you know precisely what issues you’re going to address during each visit. Will that make it difficult to assess progress or diagnose problems? Probably not. In fact, it would probably make you more attentive to what you’ve been doing, or to the minor twinges that might indicate the onset of an injury, so that you can discuss them in full.

Kinni knows that MBWA might seem like too much of a luxury for time-pressed executives whose schedules are booked months in advance. But he doubles down on his belief that unscheduled MBWA is the way to go, following Peters’ suggestion that leaders keep 50% of their time unscheduled.

Good luck with that. It’s hard enough to get leaders to do MBWA in the first place, let alone asking them to keep half their days free.

I’d argue that because executives’ schedules are so heavily booked, that’s all the more reason to commit time to go to the gemba by visibly booking it in your calendar. After all, the calendar is essentially a temporal bankbook, showing you what’s sufficiently important that you’re willing to carve out time for it. As Peters succinctly says in a video, “You are your calendar,” and if you’re not willing to put it in in your calendar, it’s probably not that important to you.

So please, let’s dispense with the fantasy that unstructured time for meandering through the company will keep you “grounded.” It’s not good for the worker, and it’s unlikely to actually get done.

Commit to visiting the gemba. Let people know when you’re coming. And put it in your schedule. Then you really will stay connected to the business.

We REALLY Need to Stop Talking About Lean

Lean advocates—and I consider myself one—might do better if they stop talking about lean.

Let’s face it: When executives and workers hear “lean,” not a lot of good happens. They think it’s yet another short-term management fad. Or a cost-cutting program that will lead to layoffs. Or some Japanese thing that only works for car manufacturers.

But when you look at many of the tools and concepts from the lean playbook, they’re really just good management that any leader would want to embrace.

The Wall Street Journal recently wrote about Larry Culp’s efforts to turn around faltering General Electric. Culp, of course, was Danaher’s CEO for 14 years, and is steeped in lean thinking through the Danaher Business System. Naturally, he’s trying to instill many of those elements to GE.

Consider hoshin kanri. As the WSJ explains: "Hoshin Kanri holds that all workers should understand the company’s strategy and how their role can contribute to it, enabling feedback and improvement to come up from lower levels." 

Although the lean cognoscenti might find fault with some elements of that description, it captures the spirit of hoshin pretty well. But whether you call it “hoshin,” or “strategic planning,” or something else, it’s hard to argue that ensuring all workers understand the company’s strategy and how they contribute to it is just good business. What executive would advocate for ignorant, uninformed and disengaged workers?

Culp has also shifted focus away from earnings per share, which was once the most important metric at GE. Under Culp’s leadership, EPS is viewed not as the end goal of the business, but rather the result of well-managed operations. Lean experts will seize on this change as emblematic of a lean mindset—and although it certainly is, let’s not forget that in 1954, in The Practice of Management, Peter Drucker wrote, “The purpose of business is to create and keep a customer.” He explicitly did not argue for prioritizing profits above all else. So is de-emphasizing EPS “lean,” or is it just good management?

Lean consultants will point out that Culp embraces the lean practice of going to the gemba, the place where the work is done (typically the manufacturing floor). According to the WSJ article, Culp is often away from GE’s headquarters, visiting manufacturing plants to see how employees work and how the operations are running. He even brings top executives to factories to teach manufacturing practices. But this practice isn’t something exclusive to lean. Prior to the rise of the CEO as finance expert (as exemplified by a generation of leaders at GM), understanding how your operations work was typical—Andrew Carnegie, Henry Ford, Bill Gates, Andy Grove and many other legendary CEOs all had deep expertise in how their products were made.

In fact, if we get away from preaching the gospel of the gemba, we can simply point to the evidence that companies where leaders pay attention to their plants outperform companies where leaders don’t. In a new study from Stanford, "researchers found that plants where managers carefully monitored the manufacturing process, production targets, and employee performance, and used that data to inform decisions, were more successful. Plants where leaders infrequently reviewed performance indicators and targets, and promoted employees based on tenure or connections rather than achievement, fared worse."

You don’t have to talk about going to the gemba to make the point that close involvement with the shop floor leads to better results.

Let me be clear: I’m a lean consultant and author, and I’ve fully bought into the superiority of lean management over traditional management. I can’t imagine why anyone would want to run a company in a traditional, mass-production, command-and-control, profits-before-all-else kind of way.

But when we cloak solid business ideas in Japanese words and lean jargon, we unnecessarily create resistance and skepticism. We allow lean orthodoxy to displace common sense. And we do our companies, our clients, and ourselves a disservice.

One reason why GM fell to Toyota.

A couple of weeks ago, the Planet Money podcast aired an episode on Studs Terkel. Recently archivists found the interview tapes that formed the basis of his 1974 book, Working.

I’ve been planning to write about one of the interviews for a couple of weeks now, but I couldn’t quite bring it into focus. Today’s Gemba Academy blog post by Jon Miller, about Toyota Exec VP Mitsuru Kawai, helped clarify my thoughts by highlighting some fundamental differences between the way GM managed its employees in the 1970s, and the way Toyota deals with them today.  

Terkel interviewed Gary Bryner (starting at 8:13 here), a line worker at the GM Vega plant in Lordstown. Around the time of this interview, GM had installed Unimate robots on the line, increasing production from 60 cars per hour to 101 cars per hour, and making it the fastest line in the world. (Note: 101 cars per hour? I’m not an industrial engineer, but that seems insanely fast. Granted that cars were simpler then and perhaps easier to assemble, but it’s hard to imagine that workers could do a good job with only 36 seconds per car.)

Terkel: Yeah. So what happened to the guys in the plant that are working there now?

Bryner: It’s a funny thing. You know, when they revamped the plant [by installing the Unimate robots], they’d try to take every movement out of the guy’s day so that he could conserve seconds and time, so they could make him more efficient, more productive. 

GM’s reason for trying to be more efficient is if they could take one second and save a second on each guy’s effort, they would over a year make a million dollars. You know, they used the stopwatches. And they say, “Look, we know from experience that it takes so many seconds to walk from here to there. We know that it takes so many seconds to shoot that screw. We know the gun turns so fast with the screw so long and the hole so deep. We know how long it takes. And that’s what that guy’s going to do.” 

By contrast, here’s how Jon Miller describes Toyota Executive VP Mitsuru Kawai’s comments about Toyota’s New Global Architecture (TNGA):

Interviewer: In other words, TNGA is about the standardization of parts?

Kawai: No. In the first place, TNGA is a much larger effort. Simply put, it is “involvement by everyone.” 

He described a product development line in which the engine assemblers are over sixty years old. Their job is to do the work and complain, “It’s heavy! It’s difficult! It’s not error-proof!” so that the young team leaders and engineers use their brains to make the work lighter, easier and error-proof.

You can see the profound difference in approach here: at GM in the 1970s, managers and engineering experts define how, and how fast, work should be done. In Kawai’s description of TNGA, the line workers play an integral role in creating a better production process and design. 

On a deeper level, GM’s approach of entirely separating thinking (product design and production engineering) from doing (physical assembly), was disrespectful and inhumane. Here’s Bryner again, complaining to Terkel about the way their work was dictated by engineers with time-motion studies:

Bryner: Our argument has always been, “You know, that’s mechanical. That’s not human. Look, we tire. We sweat. We have hangovers. We have upset stomachs. We have feelings, emotions. And we’re not about to be placed in the category of a machine. 

Terkel: This is something new, isn’t it? The workers in the plant – they feel that they have a right to determine the nature of their work, too?

Bryner: We do now. We have some kind of pride being able to stand up to the giant, General Motors Corporation, and say, “Look, this is what I think is fair, and I’m willing to fight to show you that it’s fair. I just think they want to be able to be treated with dignity and some respect. And you know, that’s not asking a hell of a lot.”

The situation—and the expectation—at a Toyota plant today are quite different. In another interview that Jon Miller relates, Kawai expresses his joy that workers are actively engaged in designing and improving the assembly line: 

I am very happy that things are changing every day. On every walk, I notice “That diagram has changed,” or “They were able to shift that work,” or “Now the robot is doing that.” The fact that there are changes each time I visit tells me that people are doing kaizen. Everyone is trying to make good products at lower cost. This shows me that the gemba is alive. It is changing every day. It is reborn every day. I think this is the power of the gemba at Toyota.

I’ve never worked on an automobile assembly line, but I’m pretty sure that even at Toyota, it’s not like being on holiday. However, the stark difference between GM’s and Toyota’s management philosophy in the 1970s goes a long way towards explaining why the Detroit colossus was toppled by the Japanese upstart. I only hope that GM’s managerial mindset is different today. 

Your Lean Six Sigma Belt Program *IS* The Problem

I visited a company a few weeks ago that asks all of their employees to do a green belt project. It’s not mandatory, but completion of a project is part of their annual review. Not surprisingly, the management boasts that nearly everyone does a project. 

You know how many people do a second project? Less than 5%. 

This company is doing okay, but they definitely don’t have a culture of continuous improvement. Plenty of green belts, sure. But there’s no evidence of a continuous improvement mindset among the workers. Which is what the senior leadership wants, and why they created a Lean Six Sigma belt program in the first place. 

Read the rest of this post at Industry Week.

How "scripting the plays" can help launch your lean initiative.

My friend Bob is struggling to get a lean transformation started at his new company. He’s knowledgeable and experienced, but he’s been unable to get traction at the main plant. He’s tried everything—teaching intro classes to lean principles, taking people on waste walks, putting them in Ohno Circles, leading 5S events, practicing Toyota Kata—nothing has worked. He’s made as much progress as a piece of congressional legislation over the past few years.  

Bob believes that one of the primary causes for the lack of progress is the shortage of managerial and supervisory experience. Most of his plant leadership team was recently promoted from front-line roles. As a result, it’s difficult for them to break the habit of solving problems themselves. When something goes wrong, they immediately dive in and fix it, rather than coaching workers to understand root cause and deal with it at their level. And that makes it nearly impossible for Bob to get the managers and supervisors to focus on continuous improvement because they’re constantly distracted by the latest problem.

But of course, the more fires they douse, the more fires break out. Unless they develop front-line operators’ problem solving capability, they’re sowing the seeds of their own demise. 

So what to do?

Bill Walsh, the legendary football coach who led the San Francisco 49ers to three Super Bowl championships in eight years, was famous for scripting the first 20-25 plays of each game for his team. (This is now a habit for many NFL coaches.) Pre-determining the early phases of the game provided two major benefits. First, the ability to rehearse the exact sequence of plays during practice enabled the team to execute more cleanly during the game. Second, he could test how the opponent responded to certain plays and formations, helping him implement more effective countermeasures later in the game. 

It occurs to me that Bob might be able to “script the plays” for the managers and supervisors, which might bring stability to their work, and teach them how to coach, rather than solve, shop floor problems.

“Scripting the play” goes beyond leader standard work. It’s not just blocking out time for a gemba walk or a meeting. Rather, it would be a precise agenda for the first 30 or 45 minutes of each day: walk the floor along a pre-set route; ask a set of pre-determined questions; take 10 minutes for prescribed reflection with Bob. Only if a literal (not metaphorical) fire breaks out would they be allowed to vary from the script. 

Sure, the company could invest in leadership training. But classroom lectures, readings, and exercises are, at best, difficult to transplant to actual shop floor interactions, and at worst, a waste of time. Scripting the play might be the wedge, or the on-ramp, needed to instill new habits and help the managers and supervisors move from an operator mindset to a manager mindset. 

Have you tried anything like this? Let me know. And I’ll keep you posted on how this turns out. 

The road to hell is paved with metrics.

Michael Harris and Bill Tayler wrote a terrific article in the new Harvard Business Review on “metrics surrogation”—the tendency for people to mentally replace their business strategy with metrics. Although these metrics are supposed to reflect the company’s progress towards its goals, the focus on metrics can destroy an organization.

Wells Fargo’s “”Eight is great” initiative, which had the company measuring daily cross-sell numbers, caused employees to focus on increasing that number—not necessarily deepening the bank’s relationship with its customers. 

The Atlanta public schools cheating scandal, in which teachers received performance bonuses based on students’ scores on standardized tests, provided incentive for teachers and principals to erase wrong answers and replace them with correct ones—not necessarily improving students’ mastery of the underlying material. 

And, of course, call centers in which employees are evaluated on how fast they’re able to get off the phone motivates them to cut calls short in a variety of ways—not necessarily by solving the customers’ problems. 

In all these cases, the underlying performance or goal the organization is striving for has been replaced by the measurement of that performance. All too commonly, that leads to behavior that’s dysfunctional at best and illegal at worst. 

The authors recommend three countermeasures for this problem:  

1. Get the people responsible for implementing strategy to help formulate it.

2. Loosen the link between metrics and incentives.

3. Use multiple metrics.

All of which is valid, I guess, but I think it adds unnecessary complexity to dealing with the problem. 

W. Edwards Deming had a much simpler way to avoid surrogation (even if he didn’t call it that). In his classic, understated way, he’d simply ask:

By what method?

In other words, what’s the method for improving performance? With that simple question, people would be forced to articulate the process they’ll use to reach the organizational goal. In the case of Wells Fargo, “illegally opening accounts for customers” clearly isn’t kosher. But “inviting customers to a local branch for a complimentary financial health checkup” might work. The Atlanta teachers wouldn’t announce that they were planning on fudging test scores. But “holding after school remedial instruction” might have done the trick. And call centers could provide workers with more technical training, or give them more latitude and authority to solve customer problems based on their own judgment. 

Keep it simple: By what method?

Start small. Move fast.

An improvement team at my client was struggling to get started on their experiment. They spent nearly a month interviewing people in multiple functions, trying to understand all the possible permutations of the current condition. They discovered that it’s really, really complicated. 

And that made it difficult to start improving the process. Trying to get all the pieces in place for their first experiment was laborious—so many moving pieces, so many people to include, so many variations to consider. 

No surprise there. Office processes are notoriously intertwined. You’re about as likely to find a problem confined to a single functional silo as you are a copy of the National Enquirer in the Library of Congress.  

Which is why it’s good to start improvement projects with small steps. Mike Rother suggests that initial Toyota Kata experiments should be sized for completion in about two to three weeks. Any more than that, and the complexity of the change outweighs the improvement skill level of the people making the change. 

Equally important, if the experiment goes on for too long, it runs the risk of becoming yet another time-sucking, dispiriting corporate project with undefined benefits in the indefinite future. That’s no way to get people excited about improvement.

People are animals. They crave rewards as much as your dog wants a Milk Bone. As Teresa Amabile and Steven Kramer show in their book The Progress Principle, the gratification that comes from forward progress—no matter how small—is a powerfully motivating reward in and of itself.  When an experiment is too big and takes too long, people don’t get that emotional reward. And that makes the long continuous improvement journey feel like a life sentence in a salt mine rather than an inspiring walk in broad and sunlit uplands. 

This improvement team has just recalibrated. The process they’re trying to improve is still complex, crossing over multiple functional silos. But now they’re just taking a small piece of it, and are expecting results in a couple of weeks. 

They’re very excited. 

Start small. Move fast. 

An Unanticipated Benefit from Toyota Kata

I’m using Toyota Kata to help a client shorten its lead time for product design/delivery. This company sells primarily to department stores and mass merchants, a distribution channel that’s facing incredible pressure to shorten lead times—no one wants to guess six months out what’s going to sell, and inevitably be stuck with a bunch of closeout inventory. 

I have three teams working on experiments. As you’d expect with the kata approach, some of the experiments have yielded good results. Many more of them went nowhere. 

But the happy surprise for me (and the teams) was the improvement in cross-functional communication. The company is very siloed. Historically, people in one silo haven’t talked much to people in other silos, unless it’s to complain about something that’s gone wrong or to find out when something was going to get done. 

The experiments they’ve undertaken has forced the improvement teams to talk with people upstream and downstream from their silos. And that communication has really changed morale. It’s not all sweetness and light, of course, but there’s a greater appreciation on all sides for how their work affects others—and how difficult their jobs can be. 

We still have a long, long way to go, but the increased, and more productive conversations have already made a difference in attitude. 

How Scientific Thinking Won the Women’s World Cup Title

In the glow of the US women’s national soccer team’s World Cup title—and the long record of success the team has had over the years—it’s easy to forget that victory didn’t always seem quite so inevitable. Although the team dominated and won the World Cup in 2015, a year later it lost to Sweden in the quarterfinals of the Olympics.

Coach Jill Ellis noticed that Sweden employed a fundamentally different strategy than she expected. To add to the problem, many of her key players were getting older. She needed to make changes. But what changes?

Scientific thinking (Plan-Do-Study-Adjust, or PDSA) teaches us to experiment our way to improvements, because it’s impossible to know in advance what will work. Ellis stated publicly that she was going to put the team through an evolution that she felt necessary to win the 2019 World Cup. As Sports Illustrated reports, that’s precisely what Ellis did:

vowing to unlock more creativity in the attack, Ellis launched a period of experimentation (with formations and new players) that proved an old adage: Real change can be an ugly and uncomfortable process long before it becomes glorious.

Not all experiments are successful the first time. At the SheBelieves Cup the following year, the team notched two draws and only one win. The nadir was its game against France: the US team went down 2-0 after nine minutes to France and ultimately lost 3-0.

Critics assailed Ellis for not knowing what she was doing, and making the most talented team in the world look bad. After all, look at the lousy results.

But that’s precisely the point of experimentation—it’s to see what doesn’t work, so you can figure out what might work. That’s what happens on Mythbusters, except no one attacks those guys for “failing” when their initial attempt doesn’t work out. It’s the constant experimentation that makes the TV show interesting and enables them to get where they want to go (usually, blowing something up). Mike Rother captured this idea in a Toyota Kata slide:

By the following year, Ellis settled on an unconventional 4-3-3 lineup (four defenders, three midfielders and three forwards). She used different personnel from the Olympic team, including Rose LaVelle, who became one of the breakout stars in France.

In 2018, the team was undefeated.

It 2019 it won the World Cup.

PDSA.

"Process Mining"? Sounds Like a Waste of Time.

You know what the problem is with your lean initiative? You’re not doing any process mining. 

Yup, that’s right. You’re missing the boat on “process mining,” the latest improvement breakthrough that will catapult your firm to the top of your industry. According to a new HBR article, process mining will “revitalize process management in firms where it has lain fallow for years.” 

The authors state that companies adopting business process reengineering are so focused on the future state that they ignore a thorough analysis of the current state. Conversely, companies that adopt an incremental improvement approach

tend to spend too much time on analyzing the “as-is.” In addition, their current process analysis is frequently based on interviews and sticky notes, which executives sometimes regard as overly subjective and treat with justifiable skepticism.

I hardly know what to say about this argument. How do you define “too much time”? If you don’t know where you are and what’s actually happening, how do you know what to change? What kind of current state analysis only has interviews with no observational data? And are executives really skeptical of sticky notes? I could be wrong—I’ve never shown a hand-drawn process map to the CEO of a Fortune 10 company. Maybe executives at that pay scale really do have an issue with sticky notes. But you could always transfer the notes to Visio or Smartsheet or iGrafx if your CEO is allergic to Post-Its.  

Fortunately, now there’s a host of companies providing process mining software that will eliminate all these problems and set you on a smooth glide path to success. The software captures information and transactions as they flow through the company, and makes visible how long that (computer-mediated) work takes. 

For example, the global chemical company Chermours used process mining to analyze their order-to-cash process:

It took the process mining effort four months to uncover how the actual process was performing (not just what the ERP documentation stated). It made the entire process visible and revealed some glaring issues. Credit holds was one such issue, as process mining exposed that strategic customers were sometimes placed on credit hold needlessly to enable manual steps in the O2C process.

Look, I know that Chermours is a large company—4000 customers in 130 countries. But still. It took four months and an expensive piece of software to find out that strategic customers were needlessly placed on credit hold occasionally??? They couldn’t have figured that out in two days by going to the gemba, watching the process, and actually, you know, talking to the employees in the credit department? I’ll bet you dinner that when the CIO and CFO announced this Copernican insight to the company, there were a bunch of $20/hour front-line workers doing a facepalm.

Another great sales point for the software—the opportunity to anoint a class of high priests with specialized knowledge who take responsibility for improvement. At ABB, 

A small group coordinates the process mining effort in the head office, and as much as 80% of the process mining work is done by Quality & Operations personnel at the business unit level as part of ABB’s continuous improvement program.

Gee, that sounds terrific. Place responsibility for improvement in the hands of a few people who have the special skills and training to operate the software, and let them fix the problems. Leaving aside the fact that you’re ignoring the accumulated knowledge and wisdom of the front line employees, you’re setting yourself up for an improvement bottleneck and a nice long queue when the high priests of process mining can’t work with you for another six months. Continuous improvement? Discontinuous improvement is more like it. 

And finally, one last benefit of process mining: 

Process mining also contributes to reducing non-value-add activities and eliminating manual reporting efforts.

I have no doubt that it does make work more efficient. And so does close observation of the work with standard work combination tables. But that would only cost about three cents per page, which isn’t nearly as exciting as investing in a giant piece of expensive technology.

Look—I’m sure that sophisticated software can play an important role in process improvement, especially when you’re dealing with highly complex processes. But relying on software at the expense of direct observation is insane. 

I spent two days watching the warranty process at one of my clients. I saw how one person was slower than another because at 5’0” tall, she couldn’t reach the shipping boxes where they were stored, and she couldn’t access the database at the same time as the warranty lead. I’m sure that process mining software would have revealed precisely how much slower she was than her colleagues, but that would have completely missed the point.

Go see. Ask why. Show respect. Before you start mining. 

Adding Technology Isn't Always the Answer

It’s been a long time since I blogged about the inanity of multitasking in a cognitively demanding environment, but my friend Mark Graban sent me an article that reminded me of how important this topic is. 

According to a new study by Penn Medicine and Johns Hopkins, first year physicians spend 87% of their time on indirect patient care, half of which is consumed by the various electronic medical record systems. Worse, they spend only about three hours per workday on direct patient care, and they multitask during a large chunk of that time. 

I’m not a physician (and I don’t play one on TV), but I’m pretty sure that spending 87% of your time away from the customerpatient can’t be any good. To be sure, there’s certainly value—doctors need to do research, examine lab results, evaluate patient and family history, etc.—but 87%? And I know there’s incidental work that must be done in order to ensure high quality care and compliance with the thicket of regulations that hospitals and physicians labor under. 

But still: 87%? It’s hard to imagine a scenario in which 87% is the appropriate amount of time to spend away from the patients to whom caregivers devote their lives. And I can’t think of a single doctor (including my wife) who has said, “Yeah, I spend way too much time with sick people. There’s nothing better than a few hours in the privacy of my office messing around with the EMR.”

The multitasking issue is perhaps even more alarming. The time that the physicians have in direct contact with patients is so limited, you’d think that they’d want to maximize its effectiveness. But by multitasking, they compromise the benefits of the face-to-face interaction. The research on multitasking is voluminous and unequivocal): it simply doesn't work. Whether you’re a student taking notes, a businessperson reading email while in a meeting, or a doctor listening to a patient, if you’re splitting your attention between two cognitively demanding activities, you’re not going to do either of them well. When you think about the importance of using all your senses to really engage with a patient to deeply understand the problem, well, multitasking is a recipe for misdiagnosis, medical errors, and at the most basic human level, just plain hurt feelings. (“Why isn’t the doctor looking at me and paying close attention?”) 

The fact that the physicians are coordinating care or updating medical records for about 25% of the time they spend with patients reminds me of a story that my friend, Roger Chen, former head of CI at Martin Memorial Health System told me. Years ago, MMHS invested heavily in computers on wheels (“COWS”) for the patient rooms to make it easier for the doctors to enter information while they were with their patients. Unfortunately for MMHS’s finances, it turned out that patients hated the COWS—they felt that the doctors weren’t really paying attention to them when they were multitasking (listening and typing). So they scrapped all of them. 

We spend a lot of time in the lean community talking about value added activity, incidental work, and waste. Many hospitals are beginning to turn that lens on physician activity. It seems like a good idea to bring that mindset to the training of new doctors as well.

Better Managers Isn't Enough for Higher Engagement

(Note: this article first appeared in Industry Week.)

A recent article by Sam Walker in the Wall Street Journal argues that better managers are the key to delivering better results.

Walker cites research by Gallup showing that the quality of middle managers determines 70% of the variance between high-performing and low-performing companies. Because managers can instill (or at least heighten) a sense of purpose and meaning in employees’ work, they drive the critical measure of employee engagement, which Gallup defines as a belief among employees that they’re doing meaningful work in a climate that supports personal growth. And that in turn leads to lower turnover, higher productivity and better profits.

This isn’t really an earth-shattering insight (even if the high level of correlation is eye-opening). We’ve all heard the maxim that workers don’t leave companies; they leave their managers. So this makes sense.

Now, it’s not always easy to connect an organization’s product or service to something “meaningful.” Not everyone works in an organization singularly focused on eradicating river blindness or rescuing otters. It’s a lot harder to talk about meaning when you work in a quarry or a factory making low-density polyethylene squeeze bottles for ketchup. And there are plenty of days when the work you’re doing—no matter where you're employed—isn’t going to feel particularly meaningful (notwithstanding the apocryphal story about JFK and the janitor at NASA who proudly explained that he was helping put a man on the moon).

But what’s most dangerous in Walker’s prescription is that companies simply need to hire (or train) better managers, and everything will be right with the world. He places the burden for increasing engagement on the individual manager.

That seems risky to me. There’s so much variability in people and environments that a “good” manager in one situation might not be a good manager in another.

What if instead we created mechanisms to increase employee engagement? What if we set up policies and processes so that it’s easy for people to grow in their jobs?

That’s the beauty of focusing on improvement. Every job does provide an opportunity to grow. Challenging people to improve the process by which they do their jobs harnesses their creativity and their innate desire to succeed, leading to higher engagement.

Unfortunately, too many organizations pay lip service to the notion of improvement without creating mechanisms to make it happen. They won’t spend the money to give workers enough training: A woman I know in the OpEx department of a $30 billion company needed three weeks to get approval for the $900 to attend a recent conference. Or they rely on suggestion boxes (“Where good ideas go to die”) rather than openly posted improvement boards. Or they don’t provide workers with the slack time they need to do improvement work—workers are paid for a 40-hour week, and it requires the papal seal of approval to get overtime pay for improvement work.

Cambridge Engineering in St. Louis is an example of a company that has created these mechanisms. Workers get training in lean and problem solving, of course, but even more importantly, they have 30 minutes every day to do “lean and clean”—work on improvement projects, or just clean/maintain/5S their areas. During their busy season, the company unquestioningly pays overtime to ensure that everyone has the ability to do their half hour of daily improvement.

Of course, these mechanisms don’t guarantee a high level of employee engagement. But they reduce the reliance on the talents of individual managers and increase the likelihood that employees will feel their jobs provide them with the opportunity for personal growth.

Toyota says that there are two aspects to every job: doing the work, and improving the work. Instead of relying on individual managers for employee engagement, let’s rely on this second component for higher employee engagement—and higher company profits.

Apollo 11: A Symphony of Work, a Ballet of Knowledge

I’m heading to Houston tomorrow for the LEI Summit—always an exceptionally inspiring and educational event. I’m particularly excited to visit Houston because I just saw the new documentary, Apollo 11. It’s amazing. Composed of video taken by NASA and the Apollo 11 astronauts, along with Walter Chronkite’s actual description of the events, the movie provides a kind of fly-on-the-wall perspective of the now 50-year-old mission. It’s riveting. 

My favorite part of the movie (aside from, you know, the actual landing on the moon) is the launch status check just before the Saturn V rocket lifts off. The “go/no go poll” was dramatized in the movie Apollo 13, but not by much—it’s pretty close to the real thing. (Here’s the status check for the launch of the space shuttle Discovery.)

You seldom get to see such tight coordination of knowledge workers. In physical assembly lines or manufacturing facilities, sure. But knowledge workers are more disconnected—communication and information flows asynchronously through emails and memos. Much of their work is done on a “push” basis, rather than pulled at the moment of need by customers, which reduces not just the drama, but also the inherent tension of the need to do the job precisely right. 

But in the go/no go poll, you see dozens (hundreds?) of knowledge workers coordinating their efforts as precisely as any high-tech robotic fabrication machinery. Each person (and each team) delivers exactly what the flight director needs exactly when he needs it. It’s a symphony of work, a ballet of knowledge, a miracle of coordination. 

And when you’re choking on yet another stupid “reply all” email, it’s utterly inspiring.

Lean is *Not* a Training and Development Activity

A prospect told me recently that he wanted to work with me to bring lean/continuous improvement to his company, but first he needed to “integrate it into his Training and Development” plans.

I told him that he was making a mistake, and that he was likely to fail.

If you frame lean/CI as a training and development activity, you won’t get the of buy-in and commitment from staff that you need. Lean becomes something nice to do, not something that must be done for the long-term success—and survival—of the company.

To be sure, when lean is done well, it IS a skills and human development activity. John Shook and others have written extensively about how lean is a socio-technical system, not just a collection of tools. And yes, some training is required to learn both those tools and the fundamental way of thinking.

But try getting a plant manager, or the leadership team of a company, to commit the necessary time and attention when they see lean as simply another training and development offering of the HR department. You’d have as much success telling your 10 year old that meditation and yoga are important for success in a PE game of kickball.

Whether or not you buy into the idea of lean as strategy, the results over the past 75 years show that it’s an unequalled tool for improving both the performance of an organization and the people who work in it. It’s not just a training and development activity. It must be integral to the way the company operates. You need to think of it as the way that you do business, period