Busting the myths of Lean Principles

Myth No. 1: Lean is about cutting staff

Screen Shot 2014-05-21 at 8.30.19 AMIn the course of my conference presentations around the world, I get to speak to many people about Lean Principles and organisational change. Yet even though the idea of Lean Principles has been around for a long time now, I still hear the same misconceptions about what it is and what it really means.

One major myth which needs to be firmly dispelled is that Lean is all about cutting staff. This could not be further from the truth.
The thinking goes something like this: ‘If we are to trim our organisation and our practices down, we must also trim down our staff, making things more efficient by getting rid of dead weight.’

It is important to know that Lean is actually not about trimming down at all – it is, in fact, about increasing efficiency by redesigning the entire organisation so that it can release and realise human potential. This is how it will begin to innovate.

Thus, far from being a negative, the Lean approach to staff development is overwhelmingly affirming, positive and vital to the entire operation of the company. Put more simply – it is not about cutting, it is about growing.

From ‘push’ to ‘pull’

In the past, almost every organisation around the world operated a ‘push’ selling model. Products and services were pushed out, managers pushed staff to sell and staff pushed customers to buy. This model was built on the old economic theory of supply and demand. An organisation grew a supply and it worked hard to generate a demand so that the product could be pushed and sold to customers.

But today, circumstances are vastly different. We live and work in an era defined by constant change and uncertainty. (Ironically, uncertainty has become the one constant that we can rely on). And in this modern climate, organisations must adapt, if, in the words of Bob Dylan, they are to ‘swim’ rather than ‘sink like a stone’.

In the modern era, growth and prosperity are much more likely to occur when organisations make the decision to abandon the ‘supply and demand’ push model in favour of ‘demand and supply’ – a ‘pull’ model.

So who, in this new model, is doing this pulling? It is the customers, ‘pulling’ products and services from the organisation.

Lean Management = ‘people, people, people’

In the traditional model, the front-line, customer-facing employees were looked upon as the least important in the chain of personnel – the bottom of the line of command.

Typically, these people understood little of the ‘big picture’, even though it was often their job to respond to a wide variety of customer complaints and demands. But the ‘pull’ model demands that these front line staff not only have a profound understanding of existing customer needs, but are also able to respond and identify new needs and then inform the management about what should be done to create more value for customers.

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Thus, we now have a completely different kind of information flow.

In the old model, managers told staff what to do. In the new model, staff are telling managers what to do. Now look at the implications for the importance and value that we place upon our staff. As stated earlier, this is not about cutting, it is about growing.

In the top-down model, the lower the employee, the less they knew about what the customer wanted or needed and the more mindless and robotic were their tasks.

But now, when we broaden people’s operation, we are empowering them. In knowing and appreciating their greater importance to the organisation, they become re-energised and they start to develop a renewed focus.

When, driven by the knowledge of the staff, an organisation becomes a thinking system in this way, it truly is people who create value. After this, with support from systems and processes, we find ourselves in the ideal position to innovate and deliver new business objectives.

So that’s the model, and as you can see, it is built on the value that people can bring. But how do we achieve it? Well as I’m fond of saying, all boats must rise on the rising tide of change.

By this, I mean that everyone, from senior managers down, must be constantly involved in some form of personal development, from customer-facing staff across to senior managers, whether that’s business acumen, strategic planning, new technology or how we actually manage our people.