What is the Business Unit Leaders’ Role in Implementing Lean?

QUESTION: How do the roles of leaders at different levels of the hierarchy (e.g. CEO, COO, VP-Ops, Plant Manager, Production Superintendent, Supervisor, Team Leader) differ with respect to implementing lean? (Part 2)

ANSWER: Happy New Year, fellow manufacturing excellence Champions!  I hope everyone had a safe and enjoyable holiday break.  Now it’s time for us to re-engage with the topic of Lean Leadership!

In our first entry to this new IW feature, we grouped leaders into three categories for purposes of discussing roles and responsibilities based on the level of the organization. They are:

1. Board of Directors, C-level executives, senior Leadership team

2. General Managers, VPs of Mfg/Ops, Engineering, Quality, Supply Chain, etc. at Corporate Staff or the Business Unit level

3. Plant Managers, Value Stream/Department Managers, Supervisors, Engineers, and other professionals

Last time we spoke directly to group # 1 and suggested that this, ideally, is where the Lean Revolution should start.  Why?  Because this is where the most important company strategies are set and where alignment must be established first.  We also recommended that regular progress updates to the Board of Directors should be part of the broad-based communications plan.

Now let’s turn to group # 2.  This is the Division or Business Unit group that interprets the overall strategy to the specific businesses of the company.  Group # 1 might publish a broad strategy such as:  “We want to be the best in the world at what is important to our customers and shareholders.”  The President/General Manager of the Scooter Division, with her leadership team, might publish the business strategy this way:  “The Scooter Division is committed to manufacturing and selling the safest, highest quality scooter in the world.”  Then the leadership team at the Division level would go about detailing some key objectives for that strategy such as:

• Complete a Voice of the Customer spreadsheet on the top 20% of our customers by annual sales volume.  (Note use of Pareto to prioritize the use of scarce resources.)
• Complete a product/process design project to collect the Critical-To-Quality (CTQ) attributes on those products accounting for 80% of unit sales.
• And so on.  The objectives on this list may well overlap with objectives at the factory level (more on that in the next entry), but the objectives in Group # 2 should be led by leaders from Group # 2.  This requires that they directly engage and begin to “walk the talk” as opposed to the more common issue where this group simply “talks the talk”.

Another important responsibility of this group is to reach out to Group # 1 and assist with their education and training needs.  No Director, CEO, CFO et al necessarily needs to know how to lead a Kaizen event.  On the other hand, putting this group into a “Lean 101” type class would be helpful.  They need to understand basic terminology so they can ask intelligent questions; understand presentations that will be made to keep them informed; comment publicly when called upon; interact with managers, supervisors, and hourly associates when they visit division and plant locations.  I always recommend that there be at least one expert, i.e. a certified Lean & Six Sigma Master Blackbelt at the Group # 2 level to conduct training of the various Group # 1 and Group # 2 leaders and well as to train Blackbelts and Greenbelts as required at the factory level.  Someone from the HR Training Department should guide the expert to develop content/level of detail appropriate to the various audiences.

Other important responsibilities for Group # 2 are:

• Lead continuous improvement in your own areas, e.g. marketing, customer service, finance, IT, HR, supply chain, design engineering, etc.  Excellence must be broad-based, not just on the factory shop floors!   Folks in the plants will tell you that about half of the problems they deal with in the shop got sent there from somewhere else!  
• Leaders must show up at special recognition events!  When a small team of associates have completed a major improvement project, show up to celebrate and congratulate them.  Reinforce how important their work is to growing the business, improving long-term job security and the like.  And plan a few extra minutes to just hang around and chat informally with the people who are actively executing the strategy to achieve and sustain excellence.  This sends a powerful and aligned message!
• Provide “air cover” for those below you in the structure of organization.  There is no linear path to excellence.  It is more likely to be a saw-tooth pattern of peaks and valleys though the trend will be upward forever.  But there will be mistakes and we should certainly expect to learn from them.  However, the quickest way to turn the people off who are busting their tails to improve is to react negatively to honest mistakes and start looking for blame.  Our mission is to stop the traditional approach of finding out WHO made a mistake and change the culture to find out WHAT broke down in the process?   And how can I help us get back on track? 

This last bullet may be the single-most important thing Group # 2 leaders can do for the organization.  This is the group who can educate and “re-train” what the C-level leaders should expect and the need to instinctively look for the WHAT.  At the same time they can shield the Group # 3 leaders from needless distractions and fire drills that often result when something goes wrong.  I hope it’s clear that Group # 2 is the critical group for keeping the continuous improvement strategy on track and for “making it ok” to change the culture across the company.

Next time we’ll speak to the leadership roles in the plants.

“Even if you’re on the right track, you’ll get run over if you just sit there.”---Will Rogers

Larry E. Fast