Why bother with lean? Because it Rocks!!

john.mullinax — Thu, 18 Jan 2007 03:13:00 GMT

My last post left off with the following set of questions:

Why bother with lean? Really, why would we want to imitate an old and slow industry like manufacturing? Especially given it's long and steady decline in the United States. With the acceleating pace of change in the world, we need new ideas that can help us be agile and adaptive, don't we?

While it's not always an easy journey, I find it does have it's rewards. In the manufacturing industry, few if any seriously debate the value of being lean. Basically, everyone wants to be lean and the debates today are around how to best do it. Lean thinking has literally transformed manufacturing around the world. Moreover, other industries support lean as well. For example, retail establishments like Walmart support manufacturers in continuously improving their lean-ness by providing them demand chain visibility. REI uses the principles of "flow" and "evenness" to make optimize their checkout lines, as have most retail financial service operations (i.e., bank branches) -- though lean adopters are not always consciously thinking about lean when they take these actions. In many cases, people are simply copying what has worked elsewhere.

Copying others is definately a low-effort way to make changes. It can work well in the short run, and can be genuinely helpful to long-term learning and oganizational growth. That said, I suspect the consciously early-adopters of lean in a new industry do so because they want to lead their industry. As their successes are copied, competitors may gain as well. But in the long-run, an understanding of the lean principles and a commitment to continuous improvement in a rapidly changing world allow lean thinking companies to generally increase their performance leads over time versus those who blindly copy yesterday’s (or this morning’s) actions without understanding why. I suspect that near the end of the lean adoption cycle in an industry -- for example, where we are now in the Manufacturing industry -- lean adoption and lean thinking get taken up by the last of the "hold outs" as a matter of survival more than a matter of leadership.

The funny thing is that people often view the manufacturing industry as old and slow. In today's vernacular, people want their organizations to be adaptive so they can cope with the ever accelerating pace of change. Fortunately for all of us, a framework for being adaptive already exists -- in fact, it's fundamentally built into lean thinking: understand your environment, experiment, apply improvements, and repeat.

It's worth noting that this core nugget of lean is also the fundamental idea behind the Deming Cycle (Plan-Do-Check-Act), as well as Six Sigma (Define-Measure-Analyze-Improve-Control). Thanks to John Boyd, US Army teaches it's soldiers the OODA Loop (Observe-Orient-Decide-Act) -- essentially the same idea, which Boyd built from Godel's Incompleteness Theorem, Heisenberg's Uncertainty Principle, and the Second Law of Thermodynamics- the entropy of a closed system increases. Not the first to do so, Boyd extended the idea to social evolution, and believed that the decision cycle is the central mechanism of adaptation. Jack Welch said (paraphrasing) that if change on the outside of your organization is faster than change on the inside, you're in trouble.

Though I certainly don't put myself in the same category as the giants above, I've also written about this in a different forum as Respond-Sense-Learn, based onthe ideas of Philosopher Karl Popper, as well as Peter Senge (minimizing Deming's "plan" component as a step toward greater agility).

Finally, what does any of this have to do with Microsoft? Well, quite a bit, actually. Taken together, Microsoft technologies provide an outstanding platform to help you build an adaptive organization. For example:

Bringing business intelligence to all parts of the enterprise so that workers up, down, and throughout the organization can make faster, more insightful decisions with higher success rates at each of the multiple decision events they face during a typical day.
Sharing that information with people in the flow and context of their business processes, be they structured or semi-structured/unstructured -- as so many business processes actually are.
Sharing information with visualizations that actually inspire insights, and within tools people already know and that enable immediate actions to be taken.
Rapid and easy business process composition, prototyping, experimentation, and implementation, including tools to monitor and assess the performance and "fitness" of specific business process variations against measures that matter to you.
The capability to use that same data about business process "trials" -- and potentially every prototype and production implementation is also a trial -- to build and execute simulation models that create even greater insight about your business so you can understand what truly drives the results you care about.
Ironically, the deep understanding of what drives your results that can come from enabling business intelligence throughout your organization, business process experimentation, and business simulation is actually the key to reducing information overload and controlling the flood of data that threatens to drown people's ability to do productive work. By understanding the things that really drive results, we can target our activities and only report, share, and analyze the things that actually matter.
And if you find yourself in an environment of ontological uncertainty, the collaboration and communication platform provides a wide variety of communication channels to ensure folks understand the organizational principles that will enable them, as individuals and team members, to drive in a common direction toward an uncertain future.

I believe in Boyd's idea that decision making is the primary mechanism for adaptation. The reality is that, whether we realize it or not, we all live in a world where the ability to make better decisions faster about the things that truly matter will ultimately determine our success. Many folks will make speedy, apparently "effective" decisions about things that appear to matter -- but really don't drive desired results because they are themselves driven by other "confounding" variables. Perhaps even more people will make slow, ponderous decisions on topics that may or may not drive results -- but cause opportunity and value to slip through their fingers. And a comparatively small group of people will make rapid, insightful decisions about things that truly do drive results. Over time, these people will work for the leading companies in their respective fields, because they will have created that success.

Whatever the labels you decide to use, I invite you to join me on the journey!

Beyond | IT : Deming cycle

Why bother with lean? Because it Rocks!!