When Neptune Technology Group decided to embark on a lean enterprise-wide transformation, they had several lean initiatives underway.
Although the company was performing well, they weren’t seeing the major improvements they were hoping to see as a result of their focus on lean strategy. As the company’s VP of Operations said in a recent interview, “We fell into the trap that a lot of companies fall into. We implemented a lot of lean tools, but we didn’t have a lean culture.” They needed to reboot their program.
Neptune went on to hire a lean consulting partner and concentrate on building a lean culture and a customized, integrated strategy focused on their unique needs. Their efforts have paid off, and two years later, workplace safety has increased from 80% to 90% and production yields are up between 5% and 8%.
Neptune made a dramatic turnaround, but the company’s rocky experience with lean isn’t isolated. In fact, most lean initiatives will fail: 73% of lean initiatives fail in the first year.
Why do lean project fail when companies invest significant time, money, and effort into making them a success? More importantly, what steps can you take to turn around a lean initiative that’s not performing well?
Reason #1: Leaders Are Not Aligned with the Objectives of the Company
One the biggest reasons lean initiatives fail is that they’re not tied to the company’s larger objectives. As Simon Sinek says in his iconic Ted Talk, it’s important to know your “why.” If you bring the leaders of a company together in the same room and ask them if they all have the same shared mission, the vast majority will agree verbally. However, if you ask those same executives to write their vision and mission on a piece of paper, less than 5% of their answers will be in line with the others.
What this means is that at most companies, the leaders are not on the same page when it comes to their vision and mission for the company. Without a clearly shared and communicated vision and understanding of a company’s True North–its most important objectives–lean initiatives can’t have the desired impact. Your company’s leaders must be able to answer the question, “Is this lean effort bringing you closer to your company’s goals?”
Reason #2: Your Lean Program Is a Series of Projects, Not a Lean Culture
Often, companies implement lean initiatives as a series of projects or process-level changes. Each lean project has its own focus and everything is a quality-focused, tactical effort. When you take this approach, you may have quick wins or make a small impact, but it won’t lead to long-term sustainable change or make the major improvements you hope for.
Instead, companies must focus on changing their culture. By building a lean culture of leaders and teams that are excited to commit to continuous improvement and who see lean as a way to actively problem solve, it’s possible to transform the way a company operates.
Reason #3: Employees Are Not Engaged
Without an engaged team, a lean initiative will never succeed. Time and again, companies roll out lean programs without communicating to and training their staff. There must be buy-in and understanding at all levels of the organization. It’s important for your leaders and workforce alike to understand why a lean initiative is important and how it benefits them to participate.
Successful lean deployments require extensive training, practice, and oversight. Often, there can be cultural obstacles to overcome. People may be resistant to change, protective of their functional areas, or concerned that a new way of doing things renders them obsolete. It’s important to get your workforce excited about lean and about actively taking part. Not only can strategic approaches like engaging them in dynamic activities help them connect with lean initiatives, but it makes your overall efforts more grounded and successful.
Reason #4: The Training and Program Design Is Too Theoretical
In many ways, lean has become diluted. Much of it is taught in a classroom setting, far removed from where the ideas will be implemented. This goes against the very core of lean thinking, which suggests that change must happen where business takes place. The core separation of a dry training session that’s seen as separate from the actual workplace and something that workers have to cross off a list won’t yield the engagement and results desired. It’s important to move lean strategy from the theoretical to the applied world of business.
Instead, companies need to look for ways to share ideas that are hands-on and to create a working classroom. Ask how you can show your team these ideas in action, in a way that helps them understand and practice the concepts in a real way. The best approach to set up your team for success takes them through procedural changes with active hands-on training, case studies, and different ways of learning that leave them engaged and excited. From there, behavioral and cultural change will follow.
Reason #5: There’s a Leadership Gap
Your company’s leaders have to model the right behavior when it comes to lean– and when that breaks down, it’s hard to get teams on board and excited. When a new lean initiative launches, everyone is ready to participate. The executive champion who’s driving the lean initiative garners support, throws necessary resources behind the project, and leads the way. However, as momentum dies down and projects fail to generate the results the company hoped for, leaders may stop investing or even actively distance themselves from the failing initiative.
A leadership gap is typically present when lean initiatives fail. Companies need to evaluate how lean initiatives tie into their bigger objectives and determine how leaders can best support the development of a lean culture. From driving top-down change to being present at meetings where lean efforts are discussed, a company’s top executives set the tone for how those efforts live out their mission.
Reason #6: Lean Solutions Are Not Customized to Your Unique Needs
Lean solutions frequently fail because they’re not customized to a company’s unique needs. There are a vast number of different lean tools–hundreds, in fact. However, not every solution is right for every company, challenge, or phase of lean initiative they are in.
Companies that try to follow a rote process without any customization usually find that cookie-cutter approaches are too general to really engage workers, solve problems, and provide the sustainable change needed. Instead, when you’re implementing a lean strategy it’s important to slow down, step back and ask, “Is this really right for us? How can we customize this process to our needs?”
Reason #7: There Is No Enterprise-Wide Deployment Strategy
A failure to communicate and deploy lean initiatives throughout the enterprise can leave lean programs dying on the vine. For example, a dying program may have been launched with a meeting of top leadership who then failed to adequately communicate or train their workers. There may have been a lack of effective tools used to help move things along, or the company may have failed to lay out how the new initiatives impacted each department.
A successful enterprise-wide lean deployment follows a set strategy which begins with establishing a clear vision. From here, participants at all levels of the organization are trained and there’s clear communication regarding expectations. A successful deployment also focuses on knowledge transfers, bringing together teams to solve problems, mapping the value stream, applying lean principles to each area of the business, and determining what sustainability looks like. Finally, a deployment should include clear metrics to monitor success and provide a compass for continuous improvements.
Reason #8: They’re Only Focused on the Bottom Line
Lean initiatives have a strong reputation as a cost saving strategy. And it’s a fair reputation–when you focus on reducing waste, improving productivity, and implementing cultural change, businesses grow. They become more profitable and free up resources to reinvest in the company’s growth. However, when you’re solely focused on money, you’re going to fail to generate the results needed to make a real and sustainable change.
Failing lean initiatives are often defined by a “show me the money” attitude. When cost savings or revenue generation are the only–or even the main–key performance indicator, it typically signals a company is going to focus on short-term tactical wins rather than long-term dynamic transformation. When companies commit to the larger process of an enterprise-wide lean implementation, they capture a variety of benefits that have a positive impact on the business’ finances. But there are also benefits that are equally, and in some cases even more, important: better employee morale, improved safety, higher production, unequalled quality, and happy customers.
Choosing the Right Partner
Companies faced with failing lean initiatives can take several steps to turn things around. Focusing on systematic and enterprise-wide deployments which go beyond the theoretical interventions of a workshop to really embed lean practices into the DNA of the organization is key.
When your current lean solution isn’t working, it’s time to recognize that you need an experienced partner to guide the process. Going it alone may not be the right answer.
So how can you choose the right lean consulting firm? There are a few key points to look for when selecting a partner that’s right for your business and can be entrusted to generate a positive return on your investment of money and time. The best lean consulting companies offer:
- A customized approach vs. one size fits all: The best lean consultants create a customized program which is built on best practices but focuses on the unique context of your business. From understanding your industry to getting to know your leaders and team, successful lean initiatives are always bespoke, rather than off the shelf.
- Employment of a systematic approach to evaluating lean: The top lean consulting partners have a systematic approach for evaluating lean initiatives and determining how they can best help your company achieve its goals. They’ll ask tough questions that take you through a proven process at a pace that’s right for your company and goals.
- Real experience running businesses and a deep knowledge of the lean field: Many lean consultancies today are fly-by-night operations where a practitioner has taken a weekend workshop or has very little experience. The best lean consultants have decades of experience with lean methodologies and years of hands-on experience leading businesses. With the combination of these two aspects, top lean services providers have the unique pattern recognition and insights needed to drive sustainable change.
- Focus on sustainability: The number one differentiator for a successful lean initiative is a focus on sustainability and cultural change. Lean initiatives are set up to fail when they’re just a one-off workshop targeting a single issue. Instead, you want to choose a lean consulting partner who is going to ask tough questions about what it will take to make your lean commitment sustainable over the long-term and guide you to make the choices which will support that outcome.
- A hands-on approach: Don’t choose a lean consulting partner that generates a report which will sit on your shelf. Successful lean programs require a hands-on approach. Whether it’s guiding your leaders through their first Gemba walk to understand how the business is really functioning at its heart, or training your workers in how to see through the lens of lean in everything they do, you want a partner who is willing to walk side-by-side with your company. Coaching and support are critical elements of successful lean initiatives.
- They plan to make themselves obsolete from your business: The best lean consultants have a plan which focuses on teaching you everything you need to know and supporting you on your lean rollout. However, eventually, their plan should focus on taking themselves out of the picture as your team becomes more proficient.
Are ready to explore why your lean initiatives haven’t driven the transformation you’ve been looking for and how the right lean consulting partner can help take your business strategy efforts to the next level? Contact Incito Consulting today to arrange for a personalized consultation and to learn more about lean-driven enterprise transformations.
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