Regardless of our desires and beliefs, we lose our sense of direction if our minds can’t build a complete picture of what is going around. When our desires don’t come true, we can show patience if there are understandable reasons. If work prevents us from doing what we believe is right, we need to understand why. If there is no reason, our minds can’t rest.
“Let it go” is always an option to avoid unrest. I mostly didn’t choose this option because I thought this option lets my potential energy go too. I tried to understand the reasons for management decisions when I was an engineer at Toyota. I kept on trying when I was in Chief, Manager, Director, and VP positions. I ended my 32 years of corporate life last year, and I am still thinking.
I can't remember all success and failure figures, but I clearly remember my feelings when management decisions conflicted with the beliefs of employees, including me. Admittedly, my subordinates felt the same when I didn’t help them to complete their pictures. Life is understood backward, and I want to share my understanding of why we get lost somewhere between strategy and results.
How do you measure the effectiveness of your strategies?
KPI’s measure your success and give a sense of achievement. Nice feeling! But have you ever compared the current condition with what it could have been?
“Learning without reflection is a waste. Reflection without learning is dangerous." Confucius.
Habitually, we learn from the results of experience and start living the next one. Stopping for a while and making Japanese "Hansei” (reflection) is a great learning opportunity. Hansei criticizes the experience itself by asking "what could I have done better?", and teaches more than that experience does. Facing the reality that your targets were conservative, or you were unfair to yourself being satisfied with what you achieved, shows you your potential.
“Our potential lies between what is and what could be.” Kim Butler.
Organizations in Lean journey choose different strategic goals; achieving a benchmark in the industry, best-in-class productivity, quality, or cost. During three decades in Automotive OEM’s and supplier development activities, I had enough time to observe (in fact, learned by continuous suffering from) the relationship between strategies and results. Ill-defined goals and weaknesses in strategy implementation always result in wasted efforts and pain in frontline operations. Lack of Hansei conceals accountability with excuses and causes opportunity costs to stay unnoticed.
Some common strategic mistakes that I observe:
1. Imitating the goal.
If your Benchmark is a well-performing Lean company, you can start imitating its actions. Nonetheless, don’t expect too much because imitation does not bring sustainable behavior change.
You can ask "Beam me there, Scotty'" but even Scott can manage this; your body may go, leaving your soul here.
Whenever I see top-level managers who don't believe in Lean but order middle-level managers to implement it, their situation reminds me, Captain Kirk and Scotty.
Lean organizations control their activities and results using high-quality visuals. For somebody who knows Lean, it's easy to understand, evaluate, and thus replicate the visuals and related activities of the Benchmark. This simplicity is an attractive lure, masking the difficulty of visualizing and hence replicating the culture behind actions.
Let's consider Obeya's for example. High-level visualization of projects, strategies and KPI's looks very attractive to many people. Some organizations escalate problems to managers and executives in monthly meetings at Obeya’s, which is too late because problems continue to grow and trigger other problems until they get noticed by the management.
For some others, Obeya is just a ritual to confirm the level of cooperation and speed. Imagine an organization that solves problems quickly by high-level accountability and collaboration. Can this behavior be easily analyzed and copied?
2. Choosing the short-cut
Strategies following a pre-determined route under any circumstances are vulnerable because you never know what obstacles you may face in your journey.
If we make another Hansei now, we can see the difference between what we are today and what we planned to be.
When roadmap revisions are indispensable, choosing short-cuts can be either wise or too dangerous. In any case, implementation is not less important than strategy.
Therefore, knowing your exact position and direction is a life-saving skill once you are on the way. “Base your management decisions on a long-term philosophy." This TPS principle creates its full effect when applied in all decision making processes, not only in strategic decisions.
3. Overestimating performance.
Accuracy of position and direction information is crucialç However, your progress depends on your performance.
Challenging targets develop people. On the other hand, overestimating current performance harms them by setting unrealistic goals.
Unfortunately, “Performance Management” repulses those who have no idea about its components.
Additionally, a one-time performance assessment at the planning stage is not very meaningful, as performance changes in time.
These mistakes create a circular cycle of setting targets and following KPI’s measuring performance instead of building it. You can break this cycle that makes employees feel worthless by making Hansei together with them. This exercise clearly shows you the components of the performance. Click here to see amazing Hansei areas.
How do strategies and systems affect performance?
Classical management focuses on well-formulated strategies and sophisticated systems to achieve desired results. “Do it, no matter how you feel" kind of control neglects human behavior; but can’t eliminate it. Mechanically structured Strategy Deployment sticks to fixed-roadmaps and KPI trees that create fear and drive defensive behaviors. Systems affect performance, but they affect behaviors too.
What brings an organization to its current position is the way its employees behave and build systems to improve their work. Hoshin Kanri is the best alternative to classical strategy deployment because it focuses on human factors both at strategy and implementation, thus effectively managing the performance.
How behaviors affect performance?
A thorough understanding of an organization's culture requires surveys, interviews, and detailed analysis. The effects of the culture in daily behaviors, however, can be understood to a satisfactory degree by simple structured observation. At the end of the day, what we superficially call culture is nothing but the composition of behaviors.
Wherever a typical behavior is observable, a cultural motive is influential. The orientation of this influence affects the performance deeply.
Where managers commit to hidden individual agendas, powerful cultural motives are still observed but in a scattered manner, hindering group synergy.
Organizations that engage in group survival perform better by building systems and developing cooperation behavior.
Following this line of thinking, we can imagine the performance as the vectorial sum of behaviors and systems:
How to evaluate your current performance?
The fastest way to feel the performance in a workplace is to look at targets-results relations. Activities (behaviors) take place in between these two. When I work with Lean manufacturing organizations, I usually start by asking what the goals are and what is being done to achieve them. This observation provides an understanding of existing systems and typical behaviors. Categorizing data in these two dimensions helps to visualize the current performance and thus define the potential.
Maturity of Lean systems
This dimension defines the level of Lean systems in comparison to the Toyota benchmark. I evaluate the structure of existing systems, whether they cover all operational areas, and they cooperate with other systems like HR and Strategy in a balanced way.
Engagement of employees
Employees who are engaged with the company goals believe that combating problems will develop the organization and themselves together. They do not experience significant difficulty in following system requirements and desired behavior.
You can do a similar evaluation for your company. Consequently, an organization takes its place in one of the following four quadrants:
This simple Check-up reveals symptoms that require urgent treatment and some signs that need attention:
Zone 1. Establish Lean systems for manufacturing and management.
Lean systems may be in place but not sophisticated enough to allow objective evaluation of behaviors. You can evaluate behaviors objectively if you have systems with built-in principles. Systems drive behavior in this way.
A mature justice system, for example, has clear and coherent definitions of crime and punishment. The ultimate goal of the system isn’t to define consequent punishment for all possible crimes but to shape the culture where crimes will not occur. Mature systems possess structures that support cultural development.
Where to start, from systems of from behaviors?
The word "system" is not friendly because it brings a sense of limitation of freedom in mind. "Behavior" is a relatively neutral word but is very powerful when others emulate. Indeed, emulation triggers behavioral change as a voluntary orientation of free will, whereas imitation often stays at the role-play phase. This is the reason why managers and executives have a huge responsibility of Role Modeling.
The task then; is to construct systems that drive desirable behaviors. Here is the difficulty of starting: where to find the desirable behaviors that will develop such systems?
First, you need to create an environment (high-performance culture at embryo phase) where the right behaviors are born and become visible to anyone so that emulation starts.
You can be the role model and start shaping the culture around you.
Once the right behavior is born, it will be visible to its environment and trigger emulations. I don't quite agree with people saying that the culture comes top-down. Every employee has the innate capacity to take the responsibility of being a role model for shaping the culture around them.
Next, establish Lean systems gradually in a way that your organization digests them. After a newly introduced system starts to generate desired behaviors, you can enrich their content by values (Lean Principles). Allow sone time for new behaviors to root in the culture. The digestion of new ideas is a process that takes time. To begin installing another Lean system without having this process completed will block behaviors to switch from imitation to emulation phase.
Anyone who can see the process from this angle can also see that result-oriented and quickly implemented Lean systems don't bring sustainable results. On the contrary, Lean can generate excellent results when used for behavioral development. Culture brings sustainability.
Zone 2. Grow Lean systems and culture together
We can’t see highly engaged employees in big organizations having unclear and weak systems. Organizations in Zone 2 possess positive behaviors reflecting the motivation and commitment of their employees. This energy is observable in Start-ups and rapidly growing organizations.
Leaders are the key to transform Lean from a set of replicated tools into an organizational culture and management system. Therefore, organizations in Zone 2 are lucky. Be careful; however, that residence permits issued to motivated leaders in this zone are temporary!
If they can realize their potential by establishing well-performing Lean systems, their motivation turns into a sense of self-actualization. If the company grows without investing in system infrastructure, however, this motivation may turn into frustration. Only that?
As a small organization grows, newcomers add new beliefs (values) to the culture. Growth increases workloads to a level where the founders can no longer afford to join every decision-making process.
So, as we all do, newcomers make their decisions based on their own beliefs. Conflicts arise naturally because their beliefs are not the same.
These conflicts, if overlooked by managers, settle in the culture. The manager's attitude: "I have no time to deal with conflicts now" is well known. What isn’t known is that this attitude is nothing but the childhood of a monster: "need to a comprehensive change" that will indispensably challenge the organization in the future.
If what lies behind different employee behavior are different beliefs they have, then the right time to deal with the beliefs is right now!
Do you need a tool to deal with the values? As systems drive actions, they are great tools that turn beliefs into observable behaviors. Using systems only for process waste elimination? What a big waste!
Zone 3. Focus on human factors.
Organizations here are either residents of this zone or stopping over here during their migration between Zones 1 and 4.
Old residents here have advanced Lean systems; however, can’t use their human resource effectively. No problem, if they have no plans to grow and if they are fine staying here. However, any attempt to grow without due preparation involves a risk that we learn from organizations coming from Zone 4.
Those coming here from zone 4 have a severe problem of losing employee engagement for some reason. Typically, cultural structure fails to support rapid system growth. Insisting on central decision making is a common mistake that causes overloads on some employees while disregarding what other employees have to contribute.
I also experienced chaotic conditions when nobody knew how to distribute jobs among people because unexpected problems occur at unforeseen times once the balance is lost.
Management should solve the chaos before damaging the engagement of employees, but it isn’t easy. Beware of the risk and prepare for growth when you are in Zone 3. In any case, I recommend to arm slides and crosscheck before take-off.
Zone 4. Overconfidence kills.
Nice to be here. Let's take a picture of this beautiful moment because pictures do not change in time, but real life does.
Companies here look healthy and comfortable, with advanced Lean systems and motivated employees. We tend to spend more time to recover from sicknesses than we do for maintaining our health. The critical word in Zone 4 is sustainability.
What brought the success may be extraordinary efforts, finding a profitable niche, an innovative idea that popped or having high profile employees. Chance is another factor. The success may be perceived as given, by newcomers and some of your existing employees. Being unaware of the real cost of today's victory may trigger fake overconfidence, which is a deadly mistake.
Whatever the factors that brought success to be and undoubtedly not the chance, they are barely enough to maintain it forever. Just like Lean uses standardization to maintain the advantage gained and to provide a foundation for further improvement, develop behaviors and protect them by systems to achieve sustainability.
I lived in every zone for some period of my professional life. I hope these four strategies may help you. Regardless of the zone, you are now in and your strategy, if you want every employee to find the right direction whenever they feel lost, achieve consensus on shared values (beliefs) and link them to behaviors. If you wisely use the systems to protect the right behaviors, you can create a complete picture that is sustainable.
Levent Turk, September 9, 2019
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