It's all in the mind
Successful lean change is more than understanding the processes and implementing the tools, it has be more than a management mantra and become part of the culture of the company.
Nobody within manufacturing can have missed the steady growth of lean techniques over recent years. US companies are striving to increase productivity to meet the dual threats of downward price pressure from OEMs and the growing competition from low-cost manufacturing locations. But understanding the processes and implementing the tools of lean is just the beginning. To allow a company to benefit from transformation initiatives in the long-term, any change must be accepted and adopted by the workforce; it must be more than a management mantra, it must become part of the culture of the company.
Although great innovators when it comes to products, manufacturers have a reputation for being conservative in their adoption of new process techniques, and, among the workforce, the idea of change can be an anathema. The industrial landscape is littered by high profile failures where lean initiatives, although delivering short-term benefits, have foundered once the lean consultants have left the factory and management focus has shifted elsewhere.
One company to have succeeded in a lean transformation was Boeing Integrated Defense Systems at its Mesa, Arizona assembly plant that manufacturers the Apache helicopter for air forces around the globe. The Apache programme had been spiralling out of control with high cycle times, a huge labour count and no visible product flow. When site manager Jim Luby set about planning the turnaround he was aware of all the lean tools that were at his disposal, but high on his list of priorities was engaging the entire workforce.
“The workforce is the second most critical element, right behind a driving leadership,” Luby says. “Industry has already documented appropriate lean tools for an organisation to use. But, like any other tool, it takes a dedicated, driven and lean-educated workforce to execute process improvements. If the workforce does not buy into improve-ments, the changes will not be sustained.”
One of the most reported obstacles in endeavouring to achieve buy-in from a workforce is the fear that any lean improvement would lead to redundancies. This fear for job security was one of the hurdles that Luby had to clear at Mesa. “We absolutely did have resistance from our workforce,” Luby confides. “Many people viewed lean as a ‘now you will get rid of my job’ attitude. The employees felt that if we streamlined the process, not as many would be needed, thus many would lose their jobs.
“In fact, when lean is appropriately applied, you create capacity for more work, you lower your costs, and you are more favorable for customers because you become more affordable. What we had to do is to deal with the folks who resisted, although some did choose to leave, by involving them in the improvements. Eventually, the process gained traction and people became confident that they, in fact, would not lose their jobs.”
At Mesa the message was to educate, communicate and get the workers involved in their destiny. “Create the vision, and help people achieve that vision,” Luby says. “Part of acceptance means that those involved in the process are not only responsible for their improvements, but will have a better chance of acceptance if they are part of the solution.”
Even when the majority of the workforce achieves buy-in there will always be the holdouts; those either too set in their ways to even consider the possibility of change or those too obstinate to accept the need. “If not coached and monitored, the non-believers can crush the lean transformation,” Luby warns. “Naysayers have the incredible power to sidetrack a programme. The best thing to do is to coach them, get them involved, and if they are not converted, they need to go! That’s harsh, but necessary for the good of the entire organisation. What we also found is that the ‘converted non-believers’ became our best allies and spokespersons for the transformation. If they do not convert, they are no different than any other barrier – a barrier must be removed, and not avoided.”
There can be no doubt that Luby achieved success at Mesa. In the five years that the programme has been running they have achieved an 85% reduction in the number of hours spent on assembling each aircraft as well as reducing the total throughput time by two thirds – all with no additional space or employees. All this was achieved through a workforce that understood the vision, bought into the project and were led by enthusiastic and knowledgeable champions. “People prefer to be led,” Luby says. “People are our greatest asset, but in my opinion, the people will do what leaders model in their behaviours and expectations. Leadership is the single most critical factor in a lean transformation, because if leadership doesn’t buy into it, the process will die a slow death.
“Workers look for the verbal and non-verbal communications from their leaders. If we’re talking about lean, the leader must be visible, strong and expect results. That means that the leader will do whatever it takes to bust down barriers as well. Our workers reflect our leadership style – what you see is a mirror image of how we lead. If a leader shows that this is not important, then how could we expect the workforce to engage in it? After all, people will do what the leaders expect. Tools will change over time, but one constant must remain – effective leadership will take the workforce where it needs to go.”
At Duracell’s LaGrange, Georgia, facility they have 20 years’ experience manufacturing 9-volt and AAA batteries, and for the past five years have been following lean principles in an effort to improve plummeting profitability that tumbled to almost zero in 2001. Like other organisations that have been successful in lean transformations, Rayne Johnstun, plant manager at LaGrange, worked hard to ensure that the workforce was part of the process. He believes that the employees are more than an important element of the lean transformation, they are the focus of the event. “Changing the workforce and the culture within it is the lean transformation,” he explains. “Anyone can purchase the lean tool materials but changing the workforce into a workforce that adopts the tools and abandons their old ways is the only way that a company will see the results, so in truth I do not believe a transformation can be achieved without buy-in.”
Johnstun reported that they had some resistance but nothing overwhelming. “People want to be involved in changes that affect them and daily work,” he says. “As long as the people are involved in the changes they will get on board. To ensure buy-in we used week-long rapid improvement events where the people on the team were active participants, holding events on all three shifts to make participation possible. Setting and tracking participation results was helpful. Sharing the burning platform or sense of urgency for making changes is an absolute necessity. People want to help to save and improve their jobs if they see the need or reason.” Also instrumental in bringing the workforce onside was linking a continuous improvement suggestion system to lean initiatives and modifying annual reviews to recognise participation.
Like most industries, Autoliv’s automotive component division suffers from a market that has vast over capacity and downward price pressures. Mark Newton, plant manager at the Columbia City, Indiana, plant was given the unenviable task of increasing productivity in a plant that, although newly opened, was struggling to be productive.
“I started at Columbia City in 2000 and they had had a lot of trouble there since they opened as a start-up plant two years earlier – things were not going very well. We pulled the group together and said that if we were going to succeed we would have to do it together. So how could we make that happen?”
They went further than most companies in empowering the workforce. Rather than attempt to involve workers through strong leadership, understanding the vision and motivation, they made the workforce part of the transformation. They created teams that worked together to plan and effect the transformation. “It’s all about how you get people to buy into the change process,” Newton says. “We strongly believe as a company that, to succeed, you need to have everybody involved – teamwork is the key.”
With the company based in Indiana – the heartland of auto racing – it is no surprise that they have named their scheme for worker involvement NASGAR, North American Strategic Goals Annual Race. “The whole idea is that our industry is competitive, fast moving and full of blind corners and obstacles,” Newton continues. “The most important part of our team is the workers, or the pit crew as they are termed in NASGAR.”
Under the slogan ‘Fast, But in Control’, all the visual aids to the change process are racing themed – checkered flags, red, yellow and green flags and speeding cars.
But this is no mere lip service to worker involvement; these teams have the authority to make change themselves within certain set parameters. “The best place for decisions to be made is by the people who have the information, rather than pass it up the line,” Newton says. Every member of a team receives 10 hours’ training on subjects such as active listening, time management, SMART goals and brainstorming. The team undertakes weekly meetings of around 30 minutes under strict rules of engagement and every team will have very specific quarterly goals.
A vital part of this team empowerment is a certification process. “The certification itself goes to four different levels: becoming a team; assuming accountability; performing as a team; and high performance work team,” Newton explains. “We believe very strongly in self-managed work teams. In the initial stage we help them with their goals, but as they get more experienced we let them set their own parameters.”
Whatever method is used to ensure that the workforce is part of the change process – whether it is Autoliv’s teamwork structure, Boeing’s leadership or Duracell’s communication and empowerment – it is clear that sustainable improvement cannot be achieved by mandates alone. “Peer pressure is a powerful thing, and it can be used for the good (or bad) of an organisation,” Luby explains. “Improvement requires consensus and support of the workforce, and if there is no consensus, there cannot be any sustained improvement.” Without a workforce that is part of the solution, as opposed to part of the problem, any lean transformation will be doomed to failure.