The Culture of Lean – Part 1
by Dave Rizzardo
Lean has proven to significantly enhance the competitiveness and profitability of
companies throughout the world, and some have been transformed into organizations
that are characterized as World-Class; however, far too many companies have fallen
short in developing the Lean, continuous improvement, culture that is essential for longterm sustainable excellence. To understand why this occurs, we must try to grasp what is
really meant by a culture of Lean. Other more familiar components of Lean such as the
various tools and techniques or the deadly 7 wastes are more tangible and easier to
document and clearly explain; however, an understanding of the culture within which
these tools operate is absolutely critical for realizing the power of Lean. In this article, I
will try to provide at least a glimpse or a sense of what it truly means to be living within the
culture of Lean. This is “Part 1” of a 3 part series on this topic.
Consider the following statement in reference to Toyota’s competitiveness from an article
titled, “No Satisfaction at Toyota”: “It is rooted in an institutional obsession with
improvement that Toyota manages to instill in each one of its workers, a pervasive lack of
complacency with whatever was accomplished yesterday.”1 I believe the four word phrase
“institutional obsession with improvement” both efficiently and effectively captures the
very nature of a Lean culture. If we delve into the meaning of this phrase and how it
relates to ongoing excellence, we can gain valuable insights into how to develop, or
adjust, a company’s Lean journey, and guard against faulty assumptions and definitions
that can throw organizations off-track. So, we’ll refer back to the phrase “institutional
obsession with improvement” as we build upon our understanding of the culture that most
every organization desires, but too few exhibit. However, let’s first ask the basic question,
“Why go Lean at all?”
Why must a company that is deemed successful, maybe even considered tops in their
industry, need to concern itself with improvement, let alone being obsessive about it? If it
ain’t broke, don’t fix it; right? Wrong! Wrong! Wrong! That cliché has run its course and
should now be considered outdated, irrelevant, and never spoken again; consider it
extinct. What killed it off? Competition has destroyed its applicability. The chaotic
competitive environment of today demands that you continuously rethink the current state
of your products, processes and procedures as to how they are helping you flow value to
your customers, even if not considered broken by whatever “brokenness” measure you
choose to utilize. Rather, you must break it apart and make it better. If you don’t, I
assure you that there is a competitor, or future competitor somewhere, who is finding a
way to steal your business and profits, or expanding into new market opportunities that
you never even considered because you’ve been busy patting yourself on the back and
celebrating your success. Yes, we do need to celebrate successes, but not for too long.
Nowadays, to even stand still, you must be moving forward, very quickly. This is the
reason why every single organization in every sector must “go Lean.”
Let’s consider what we can learn about a Lean culture by peering into a Lean facility such
as one of the Toyota facilities, or any facility which may be regarded as a “model of
Lean.” If you’ve ever toured one of these places or viewed a videotape of one, I’m sure
you saw many excellent examples of the application of Lean techniques such as visual
controls, cellular manufacturing, standard work, evidence of quick setups, etc. However,
this is like viewing only the tip of the iceberg, that which can be seen above the water line.
Maryland Technology Enterprise Institute, A. James Clark School of Engineering, University of Maryland.
If somehow you were able to dive deep below the water level of Toyota’s success, you’d
discover that the tools and techniques are supported and engaged via a continuous
improvement culture. This is a culture where the workforce views their jobs not only as
performing some specific activity, but rather one that also embraces the idea that they are
part of a never ending improvement effort of rooting out and eradicating waste of all
forms. The Lean tools and techniques are just some visible manifestations of this
mindset which isn’t easily grasped on a tour. Ultimately, the result is streamlined flow of
value to the customer, and improved profitability and competitiveness. In Jeffrey K.
Liker’s book The Toyota Way he elaborates on this “iceberg model” of the Toyota
Production System (TPS) in explaining their culture of continuous improvement, and he
includes a quote from a Toyota employee that ends with the statement “It’s a part of who
we are.”2 Well said.
In summary to this point, many companies are extremely successful in creating the visible
Lean advancements which are protruding above the water surface: the 5S’s and such;
however, nothing is often found below the surface providing the stability and long-term
strength. Surface Lean, or what also can be thought of as “technique Lean” just isn’t
good enough any more. The various Lean techniques and tools which we implement to
eliminate waste are all critical components of the overall strategy, but these methods do
not define the strategy completely. Make sure there’s something lying underneath the
water level at your company, an obsession with improvement. In “Part 2” of this 3 part
article, we will continue on our journey by asking the question “Do we really need to be
obsessive about improvement?” Stay tuned.
Dave Rizzardo is Mtech’s Lean Services Manager and can be reached at 410-916-3230 or
daver@umd.edu.
1
Fishman, Charles. "No Satisfaction at Toyota." Fast Company 111Dec 2006 82. Web.23
Oct 2008. <http://www.fastcompany.com/magazine/111/open_no-satisfaction.html>.
2
Liker, Jeffrey. The Toyota Way: 14 Management Principles from the World's Greatest
Manufacturer. New York: McGraw-Hill, 2004. Print.
Maryland Technology Enterprise Institute, A. James Clark School of Engineering, University of Maryland.
The Culture of Lean – Part 2
by Dave Rizzardo
This is “Part 2” of a 3 part series which began looking into what it really means to have a
Lean culture. Last month, we highlighted the phrase “institutional obsession with
improvement”1 which has been used to describe the Lean environment exemplified at
Toyota. In this installment, we’ll question whether we really need to be obsessive about
improvement? Is obsessive added just to enhance the text with some hyperbole? I
believe that obsession is absolutely essential for the simple fact that complacency is real,
and can be extremely damaging to your business. There seems to be a natural or innate
belief that there is security in the comfortable world of current success; we just need to
maintain the status quo. Keep on doing what we’ve been doing. We’ve finally made it.
However, today’s reality is that long term stability is only obtained by moving towards the
ideal of continuous improvement, regardless of current standing in the marketplace. This
is one of the many paradoxes of Lean. To be stable, you have to continuously and
purposely introduce the instability of change and improvement.
Descriptors like fanatical, cultish, relentless, tenacious, and of course obsessive, are
often found in the articles and books written about Toyota and like companies. These
aren’t just colorful words to spice up the discussion. Rather, these describe the mindset
which is required to combat the complacency that success breeds, which if ignored, and
allowed to stifle improvement, will lead to competitive disadvantage for any organization.
And to make matters worse, as John Kotter writes in his 2008 book, A Sense of Urgency,
“Complacency can live on long after great success has disappeared. Perceptions do not
have to be accurate.”2 In other words, we may be excusing our inaction because of
success which, in reality, may not even be the actual current condition.
Now that we’ve established that obsessive is not only appropriate, but required, let’s
evaluate our assumptions regarding improvement as related to a Lean culture. I believe
that even our basic definition and understanding of improvement must be reexamined. In
the past, if something went wrong or something wasn’t done properly, we realized we
needed to improve; a change was required to correct or repair the situation. We always
viewed improvement from the “right or wrong” or “good or bad” perspective. This is a
“reactive” approach to improvement or change. Lean requires that improvement be less
of a reactive response, and more of a “proactive” movement, not just introduced when
initiated by some abnormality to the status quo or by some external stimulus.
Of course, at times, an effective reactive response is warranted, but this must not be the
primary basis of your improvement strategy. If reactive improvement was sufficient, this
would imply that Lean had a defined endpoint which would be reached when the
abnormal condition or external stimulus has been addressed and everything has been
restored to the “right” or “good” condition. Along the Lean journey, there are many
milestones to reach, but there is no endpoint. It must be considered an ongoing journey
of excellence. We must be proactive and quit reacting defensively and wasting time
justifying the “rightness” of the way things are currently done.
To summarize to this point our glimpse into the essence of the culture of Lean,
continuous improvement must become more than simply a slogan or a “program of the
month,” or year or even decade, within your company. There is no magical endpoint or
Lean level that allows complacency to be acceptable. You must develop a passion within
Maryland Technology Enterprise Institute, A. James Clark School of Engineering, University of Maryland.
the organization, an extremely deep level of passion which can accurately be described
as an obsession with improvement that must pervade the workplace – an obsession with
continuously eliminating those things that add time and cost, but do nothing to add value
for the customer. By continuously eliminating the waste, we put ourselves in a position to
offer our products or services at the highest quality, lowest cost, shortest lead time, and
with the greatest flexibility possible, thus creating a competitive advantage. Next month
we continue our Lean culture journey by questioning the meaning of the word
“institutional” as it relates to a culture of continuous improvement, or an “institutional
obsession with improvement.”
Dave Rizzardo is Mtech’s Lean Services Manager and can be reached at 410-916-3230 or
daver@umd.edu.
1
Fishman, Charles. "No Satisfaction at Toyota." Fast Company 111Dec 2006 82. Web.23
Oct 2008. <http://www.fastcompany.com/magazine/111/open_no-satisfaction.html>.
2
Kotter, John. A Sense of Urgency. Boston: Harvard Business School Publishing, 2008.
Print.
The Culture of Lean – Part 3
by Dave Rizzardo
Maryland Technology Enterprise Institute, A. James Clark School of Engineering, University of Maryland.
This is “Part 3” of our 3 part series which has been delving into what it really means to
have a Lean culture. Let’s begin this final installment by backtracking in our phrase
“institutional obsession with improvement”1 and consider the meaning of the word
“institutional.” The definition of institutionalize is to make something an established
custom or an accepted part of the structure of a large organization or society. Notice the
words “part of the structure.” This implies something which is not out of the ordinary. Not
something additional or different that you reluctantly have to make time for. Not
something outside of your job responsibilities. Lean must become “part of the structure”;
it’s what we do around here every day. Lean must become woven into the very fabric of
your organization. A better descriptor would be that Lean must become the fabric. Lean
must be evident in your systems, policies, practices, and procedures. It must be evident
in your meeting agendas, your hiring policies, your training plans, your job descriptions,
and your key metrics.
A related concept to this idea of institutionalized Lean is alignment. If any internal
systems are not in alignment with Lean, you will bring your continuous improvement effort
to a grinding halt. For example, consider your compensation system. If you still pay
primarily on individual, localized, output that can lead to the waste of overproduction and
all of its associated wastes, then you may have a condition which I call organizational
hypocrisy. You are trying to lead an organization in the Lean, team-based, cooperative
direction, but reward people for individual output which may be detrimental to the
performance of the overall system or value stream. A similar concern relates to
departmental metrics which also may not be in alignment with your Lean strategy.
Beware of organizational hypocrisy. If allowed to exist within your company, employee
trust will be lost, and without trust, I promise you that the potential continuous
improvement power within the workforce will remain dormant.
Another area that must be evaluated for the existence of alignment issues is with your
front-line supervisors or team leaders. The CEO of an organization may effectively
explain the Lean strategy and direction of the organization, and how everyone will be
involved in the glorious transformation to World Class status; however, if Lean leadership
does not exist at the front-line, in the trenches, a Lean culture will be thwarted. If
decisions and actions at the floor level are in contradiction to the CEO’s Lean message,
once again, organizational hypocrisy will grow. Notice that I stated “leadership” at the
front-line, not just acceptance or passive buy-in. Most everyone acknowledges the key
role of company leadership at the top of the organization when embarking on any
significant change strategy, but often, the role of the front-line leader is overlooked, or
simply obtaining “buy-in” is the desired goal. To develop a Lean culture, leadership at the
day-to-day execution level is required. A different type of top-level leadership is also
required, but this is a topic for another day.
One other point to consider on the aspect of institutionalizing Lean is that it does not
apply only to a select few individuals within the company. Lean must become a part of
everyone’s job, from the CEO to the janitorial crew. Everyone is connected and part of
the overall system of creating a product or service for the final customer, who in turn,
provides payment for such products or services. Optimizing the system or value stream,
means the whole system, and no one is excluded. Even if you are multiple steps
removed from the final customer, it is only through satisfying your internal customers that
you connect to the value stream that generates revenue which enables you to receive a
Maryland Technology Enterprise Institute, A. James Clark School of Engineering, University of Maryland.
paycheck. The basic definition of everyone’s job changes from not only doing whatever
the “job” traditionally would entail, but also improving the job.
In summary, Lean must be institutional from both a broad perspective, involving everyone
everywhere within your organization, and also a deep perspective, as evidenced in the
specific policies, activities, and decisions that take place within the company.
Transforming to a level of institutional Lean is one of the greatest challenges for any
company on a Lean journey, but this is what makes Lean stick. Initially, Lean is extremely
disruptive to the current operating state. But as already noted, it is only through the
continual inducement of change that long term stability and excellence is realized. In a
sense, the challenge is to institutionalize constant disruption. If your organization’s
culture can honestly be described as having an institutional obsession with improvement
then you are well along the path of being Lean, and likely among the elite producers in
the world. However, there really is no such thing as “being Lean” since being somewhere
implies reaching a destination or endpoint and as you know, this Lean journey of
excellence is never-ending, but the payoff is improved profitability and competitive
strength. Good luck on your own company’s Lean journey as you develop a true,
continuous improvement, culture of Lean!
Dave Rizzardo is Mtech’s Lean Services Manager and can be reached at 410-916-3230 or
daver@umd.edu.
1
Fishman, Charles. "No Satisfaction at Toyota." Fast Company 111Dec 2006 82. Web.23
Oct 2008. <http://www.fastcompany.com/magazine/111/open_no-satisfaction.html>.
Maryland Technology Enterprise Institute, A. James Clark School of Engineering, University of Maryland.