The Only Genuine Knowledge Is That of Actual Experience

“The only genuine knowledge is that of actual experience.”

~ Chinese proverb

Training is a big part of lean transformation.  Countless hours and dollars are spent in training rooms, seminars, and classrooms every year. It’s common for people to be trained on a new way of doing things only for them to leave the training room or return from a conference to go back to work without making any changes.  This very well may be because the lack of change was part of (or lack of) the training plan.

Training followed by inaction results in nothing gained.

A company I used to work for would send several people to the AME International Conference every year.  Each attendee knew before going that the whole point of going to the conference was to bring back at least one good idea, teach it to others and implement it.

Having people attend expensive and time consuming training without a plan to improve the organization in some way is wasteful.

Here are three ways to get the most out of training.

1.  Use experiential learning techniques whenever possible.  Physical activity directly related to the the training reinforces learning. 

Our friend Jamie Parker at FedEx office demonstrated a great example of this at AME last October.  She provided class each participant with set of eight printed cards a little smaller A3 or tabloid sized paper.  Each card had a form of waste printed on it.  ThIMG_0987e set represented all of the eight wastes. 

She then showed photographs of various scenes an challenged the participants to identify the waste by holding up the corresponding card.  For example, when she showed a photograph of people standing in a queue at an airport, participants held up the waiting card.

The physical activity of selecting the correct card and holding it up built engagement and forced participants to think more deeply about the training material.

2.  Apply what was learned right away.  Use it or lose it, as the saying goes.  Don’t delay the use of newly gained information.  If it isn’t immediately reinforced through action, it will likely be forgotten.

Immediately go from the training room to the gemba.  Apply what has been learned.  If participants attend a training session on standard work, have them go to their workplace, select a simple process, and write standard work for it right away.

IMG_0985Blake Watermeier of ARC Document Solutions uses smaller, but similar cards to Jamie’s.  Blake has learners go to the gemba with a set of waste cards about 3 x 6 inches.  The participants find a form of waste and photograph the card in front of the waste.  The photographs are shared and discussed in follow up sessions.

3.  Follow up.  Continuous improvement training isn’t a one and done type of event.  Put the emphasis on “continuous.”  Learn to do 5S, then do it every day.  The only reason to learn lean tools is to apply them repeatedly.

Have learners leave the training session with an implementation plan.  Keep it simple and achievable.  Have them make some small improvements, then have a follow up session in which the participants present their improvements and get feedback.

4.  Ingrain the newly gained knowledge into the organization’s culture.  If you’re going to teach people 5S, then practice it daily.  Be relentless and accept no excuses.  PDCA.  Improve the skills daily.  This never ends.

If you allow yourself to stop practicing a lean skill, there is little point in starting.  Again, it isn’t improvement.  It’s continuous improvement.

5.  Don’t bite off more than you can chew.  Learn a new skill.  Take the time to refine the new skill until it is no longer new.  Then move on to the next.

Avoid overburdening the workforce new lean tools.  Think tortoise, not hare.  Pace the team and help them gain proficiency.

Plan for a simple training session to take weeks, if not months to become cultural transformation.  Continuous improvement is a daily practice.  Good training is essential.  The action taken after the training is what generates the improvements.

A Goal to Explore Out of the Box

By Kevin Meyer

Unless you try to do something beyond what you have already mastered, you will never grow. – Ralph Emerson

It’s that arbitrary time of the year when many folks reflect on the past and set goals for the coming year.  I enjoy reading how other people in the Lean world approach this activity as planning, hoshin, and reflection, hansei, are core components of Lean.  Karen Martin just went into hers with some nice detail, and I especially like the ritualistic aspect of her process.  Matt May has described his in the past as well, with a nod to Seth Godin’s “shopping list” concept.

I have a similar process that I’ve alluded to in a few previous posts.  Each year toward the end of December my wife and I take a vacation to someplace nice and quiet.  Instead of playing tourist to visit a bunch of new places like we usually do in the summer, this trip is purposely to have some R&R, reconnect, and recenter.  This latest one, from which I returned just last night, was two weeks at a beach house on Nevis, with nothing to do except relax, eat, talk, and watch the sunset.  And, for me, perform my annual ritual.

I take a look at my journal – a well-worn Moleskine (usually volumes 1, 2, and 3 by the end of the year), compare the plan to what happened, read the notes, and generally reflect on the year.  Although the process has weekly, monthly, and quarterly components, the end-of-year reflection is the most intense.  What did I achieve, what did I miss, what countermeasures do I need to put into place, and what should I do the next year.

This is all fairly standard, and many folks do it.  It eventually turns into what I call “My Shibumi” – after Matt May’s book, The Shibumi Strategy, and also because it somehow makes me think of My Sharona by The Knack, a band I unexpectedly partied with a couple decades ago.  I create key goals for the upcoming year, usually a couple each in categories such as physical, emotional, spiritual, intellectual, and professional.

But the most important goal I set is my “do something different” goal.  This is the one that stretches me out of my comfort zone, challenges my perspectives and biases, and helps turn me into a well-rounded human and citizen of the planet.

I’ve had this type of annual goal for about twenty years, initially informally but very formal for the past decade or so.  Earlier ones were fairly physical, like ski five European countries in six days, learn to windsurf, dive, and hang glide, and run a full marathon.

As I’ve become older they have become more intellectual, such as a deep dive into Buddhism and last year’s exploration of the history of the Bible.  I read over a dozen books on the topic, and it really opened my eyes to the complexity of the 500,000 variants resulting from intentional and unintentional translation and transcription errors, Church politics, and archeological methods.  I’ve also learned to program HTML, rebuilt a 1973 Triumph Spitfire, explored being vegan and vegetarian (ending up as a “pescatarian” for the past decade), and quit a great job at a great company to do my own thing.

I’m by far not the only one that creates such annual stretch goals.  Consider Facebook’s Mark Zuckerberg.  He has had goals to learn Mandarin, meet a new person each and every day, only eat meat he butchered himself, and write one thank you note each day.

He choses the goal after an analysis of the gap between where he is and where he wants to be.  A key outcome is that he learns something new, and often unexpected. Trying to learn Mandarin taught him that he didn’t listen well and a year of killing animals made him consider becoming vegetarian. The goal to meet a new person each day, which he achieved by giving face-to-face chats at schools, helped him understand the personal side of problems with immigration policy. Those secondary effects are often more important and meaningful than the original goal itself.

So what’s my goal for 2016?  I toyed with the perennial “get into shape” but after only a couple months on Paul Aker’s Lean Health program, I’ve lost over 15 pounds and am in the best shape I’ve been since the 1990s.  If you want to get into shape by leveraging Lean, get his new book.  I also thought about a deep dive into minimalism and simplicity, but my wife and I have been doing that at a less intense level for several years so I decided it wasn’t radical enough. The slow and steady improvement was working well.  I’ve wanted to finish a book on the nexus of Lean and Zen, but I pretty much did that also while on Nevis (stay tuned!), so that’s out.

One Hundred Years of SolitudeI’ve decided on another intellectual pursuit to broaden my horizons.  I’m going to read one of the top works of literature from each of the major ethnic groups or geographical areas – European, Latin American, Chinese, Hindustani, Arabic, African, and so forth.  It should work out to roughly one a month.  I’ve decided to start this month with Latin American.  Since I’ve already read several books by Mario Vargas Llosa, a Nobel Prize winner I met in Peru many years ago, the first one will be One Hundred Years of Solitude by Gabriel Garcia Marquez, also a Nobel Prize winner.

How will you explore out of the box this year? Perhaps more importantly, how will you ensure you actually do it, and why?  You’ll probably be amazed at what you learn about yourself – and the world.

5 Thoughts On Dealing With Leadership Resistance

By Steve KaneOvercome Your Obstacles

Gemba Academy recently conducted a one-question survey. The question was “What are you struggling with on your continuous improvement journey?” The most common response was related to dealing with leadership resistance or reluctance.

It was abundantly clear from the survey results that many people deal with the frustration of not being led on their Lean journey. Oftentimes leaders were seen as an obstacle, keeping people or organizations from being Lean.

For the respondents to our survey and others who share their sentiments, here are five quotes to help you with your struggles.

“Peace of mind comes from not wanting to change others”

~ Gerald Jampolsky

Let go of any desire you might have to change others.  You can’t force others to go along with you on your journey.  You can, however, invite them.  Practice Lean to the best of your abilities within your area of responsibility.  Be an example for others to follow.


“People are naturally resistant to change that is forced upon them.”

~ Dale Carnegie

Getting your boss to buy into your idea of how an organization should be run will likely be an up hill battle. Show, don’t tell the benefits of Lean through your own actions and accomplishments.


“Trade expectations for appreciation and your whole world will change in an instant.”

~ Tony Robbins

Appreciate the opportunities you have to share and implement Lean practices whenever and wherever you can. Use Lean principles to make your work better and easier. Appreciate the opportunities to help others (especially your boss) learn from you and grow.


“The quality of a person’s life is in direct proportion to their commitment to excellence, regardless of their chosen field of endeavor.”

~ Vincent Lombardi

Don’t give up on being Lean. Your commitment to excellence is about you. By consistently demonstrating excellence, others will take notice and want to learn. This is how you influence others. This is your contribution to the organization.


“Patience, persistence, and perspiration make an unbeatable combination for success.”

~ Napoleon Hill

Lean is a journey. It will be long and sometimes difficult, especially if you are going it alone. Don’t let the actions or inactions of others dissuade you. Stick to your principles.

Become the leader who removes the obstacles to Lean.

A Reflective Perspective on Schein

By Kevin Meyer

I will take time to be alone today. I will take time to be quiet. In this silence I will listen… and I will hear my answers. – Ruth Fishel

Morro Bay beach with Morro RockOne of my great pleasures is going for a walk on the beach a couple blocks from my house. Contrary to the popular perception of California as a land of crazies, crowds, and freeways, Morro Bay is a small working fishing village with 10,000 residents and one stop light, at the southern end of Big Sur and the prettiest drive in the world. There are over 200 wineries within 30 miles. (end tourism bureau advertisement)

And, of course, our six mile long beach with the remnant of a long-dead (hopefully) volcano at one end. Deserted, even in high season.

A long walk in such a beautiful spot creates a connection between nature, body, mind, and God. A connection often never made while buried in the chaos of normal life. It is a time for reflection and recentering.

How am I doing, mentally, spiritually, and physically? Am I on track to achieve my personal and professional goals? What countermeasures do I need to put in place? What new opportunities can I create? What activities – and thoughts – should I stop?

Regularly asking, and answering, those questions is critical for effective professional and personal leadership.

The walk is also an exercise in observation. I always try to find something I haven’t noticed before. Whether it has always been there or is a result of the ever-changing seascape from tides or storms.  This exercise has helped me become more observant in other situations.

Zen has a concept called seijaku – stillness, quietude, and solitude. It is in a state of seijaku when we become very self-aware and can harness the essence of creative energy.

Solitude gives birth to the original in us, to beauty, unfamiliar and perilous…. – Thomas Mann

My walks, perhaps kinhin, on our deserted beach every day or two has that affect. It’s when I connect the dots and come up with new ideas – many admittedly crazy, some not.  I find it sad, and perhaps disturbing, that more and more people seem to find it difficult to enjoy and embrace the power of solitude, of being alone. Many of the younger generations, raised in a world of artificial hyperstimulation, seem incapable of appreciating quiet solitude.

In a business world of teams we may persuade ourselves that we are at our most wonderful in a group, drawing on its power and influence, but as Michel de Montaigne insisted, ‘The only true freedom comes in solitude.’

The sources of music, painting — and writing itself — are solitary. The presence of others can be a joy, but also a problem. Other people may offer a solution to our problems, but it is usually a solution to their problems, and if it helps us it is usually by luck.

The simple reason we don’t find solutions this way is because we spend very little time with ourselves, and are discouraged from doing so in the modern world.

People go to the ends of the earth to see the great mountains, and wonder at them, and to explore the great rivers, and wonder about them. But the greatest wonder of them all — themselves — they never look at or wonder at. – Saint Augustine.

A couple weeks ago a few of us at Gemba Academy were discussing books we’ve found interesting. Jon Miller suggested Edgar Schein’s Humble Inquiry: The Gentle Art of Asking Instead of Telling. Those of you who know Jon know he’s a bit of an intellectual powerhouse so, with a little trepidation that the book may not be appropriate for mental mortals like myself, I downloaded a copy.

I loved it. Schein describes three types of humility and four types of inquiry, focusing in on the power of inquiry based on here-and-now humility. This form of humility happens when we presume to be dependent on someone else because that someone has something we need – perhaps knowledge.

It struck me that, although Schein was intending to describe a relationship between two or more people, his concepts are also very appropriate for our discussions with ourselves – assuming we have them, of course.

Consider the following excerpt:

What we ask, how we ask it, where we ask it, and when we ask it all matter. But the essence of Humble Inquiry goes beyond just overt questioning. The kind of inquiry I am talking about derives from an attitude of interest and curiosity. It implies a desire to build a relationship that will lead to more open communication. It also implies that one makes oneself vulnerable and, thereby, arouses positive helping behavior in the other person.

Feelings of Here-and-now Humility are, for the most part, the basis of curiosity and interest. If I feel I have something to learn from you or want to hear from you some of your experiences or feelings because I care for you, or need something from you to accomplish a task, this makes me temporarily dependent and vulnerable. It is precisely my temporary subordination that creates psychological safety for you and, therefore, increases the chances that you will tell me what I need to know and help me get the job done.

Creating a humble, vulnerable relationship with yourself opens you up to being able to inquire, discover, reflect, and perhaps create change. Accepting yourself for who you are creates peace.

Effective personal leadership, requiring conscious individual reflection, is critical for effective professional leadership. Take some time, alone and perhaps in the grandeur of nature, to humbly ask yourself some tough questions. You might be surprised at the response.

Improvement Through Personal Fulfillment

AdobeStock_64602072By Steve Kane

Tony Robbins is well known for his motivational speaking, books, interviews and articles.  A consistent theme in his work is the six human needs.

1. Certainty: assurance you can avoid pain and gain pleasure

2. Uncertainty/Variety: the need for the unknown, change, new stimuli

3. Significance: feeling unique, important, special or needed

4. Connection/Love: a strong feeling of closeness or union with someone or something

5. Growth: an expansion of capacity, capability or understanding

6. Contribution: a sense of service and focus on helping, giving to and supporting others

In his article “The 6 Human Needs: Why We Do What We Do,” Robbins explains “all behavior is simply an attempt to meet this six needs.

“The force of life is the drive for fulfillment. . .” ~ Tony Robbins

In the Lean world we advocate continuous improvement.  This means continuous change.  Common challenges in Lean transformation is a lack of buy-in and a lack of sustainment.

People are not really resistant to change.  According to Robbins’ second human need (variety), there is actually a need for change.  So, why is it so common to encounter resistance to improvements (changes) at work?

“. . .We all have a need to experience a life of meaning.” ~ Tony Robbins

Changes made within an organization are changes made to people.  How the changes are implemented can make the difference between fulfillment and emptiness for the associates involved.  Think about changes as they relate to the Six Human Needs.

Pitfalls of leadership forcing change on employees

1. Certainty.  A change can challenge a person’s sense of certainty in that it can cause the fear of experiencing pain when pleasure or at least security or consistency is expected.

2. Uncertainty/Variety.  This might be satisfied when a person is in some control of the changes being made.  Think about going on a road trip.  We don’t know what we’ll experience around the next bend, but we’ll enjoy the adventure.  After all, we’re in the driver’s seat.

3. Significance.  When changes are decided by one group of people and dictated to another group, the latter can instantly feel insignificant.  Being left out of the conversation could communicate distrust or not valuing input.  In a way, it says “you’re not needed to participate in the thinking or decision making process.”  This is particularly risky because the best ideas often come from people who work in the process being changed day-in and day-out.

4. Connection/Love.  Being left out of the process instantly disconnects people by dividing them into two camps: those inside the inner circle and those outside.  This could build distrust and resentment.

5. Growth.  Not being involved in the decision making or change planning process treats people like they are just a pair of hands instead of a pair of hands connected to a brain (an idea borrowed from Kevin Meyer).  There’s no opportunity to learn and grow professionally.  There’s no fulfillment in simply being told what to do.

6. Contribution.  Keeping people out of the decision making process robs them of the opportunity to make a meaningful contribution to the organization.  Simple labor is the least meaningful contribution a person can make when it comes to continuous improvement.  The gold is in the ideas.

Any of these pitfalls could at best prevent buy-in and at worst create a deep sense of resentment.

Help people meet their human needs in a continuous improvement environment

1. Be predictable and inclusive in your change process.  Let everyone know the target you’re trying to hit before any ideas are collected or decisions are made.

2. Let people benefit from the variety of the changes to be made by allowing them to contribute ideas and take some control of certain aspects of the change.

3. Allow people to contribute.  All ideas are good ideas.  Even if not all ideas can be implemented, simply considering an idea can help make someone feel important or needed.  Show appreciation for the thoughts and efforts people offer.

4. Create a sense of connection by allowing people to rise to a challenge together.  People relying on each other builds bonds and camaraderie.

5. Resist the urge to tell people how things should be done.  Also resist the temptation to directly answer questions when possible.  Ask questions in return instead.  People won’t grow unless they are challenged to think for themselves.

6.  Know when to lead, when to follow and when to get out of the way.  Oftentimes, people are able to make their greatest contributions when they have the freedom to work without supervision.  Give them some space.

Remember that the improvement being made now is not the end goal.  It is simply the step that will position you for the next step in your Lean journey.  By helping people meet these needs you help them have meaningful and fulfilling lives.  If that’s done well, continuous improvement can gain momentum that will be difficult to stop.

Discovering the Inner Merton

By Kevin Meyer

If you are too obsessed with success, you will forget to live. If you have learned only how to be a success, your life has probably been wasted.
― Thomas Merton, Love and Living

Sometimes there are dots just waiting to be connected…

thomas-mertonI was rather surprised when Pope Francis mentioned Thomas Merton in his address to Congress a couple weeks ago.  I have learned a lot about Merton over the last decade while on a random intellectual quest that has included other seemingly unrelated modern day folks like Hernando de Soto and Mario Vargas Llosa – a Nobel prize winner who I happened to meet many years ago.  Merton’s Thoughts in Solitude is one of my favorite books.

More on Thomas Merton in a bit. First some background.

People close to me know that for over two decades I’ve had an annual goal to “do or learn something radically different.” From this I’ve learned to windsurf and dive, ran a full marathon, rebuilt a ’73 Triumph Spitfire (which, admittedly, is like working on a lawnmower…), and skied five different countries over six consecutive days.

In the mid-90s I taught myself HTML programming which turned into various projects that eventually helped create Gemba Academy. As I’ve become older the annual projects have become less physical and more intellectual, including a year-long immersion into Buddhism, with a trip to Bhutan.  Just one of the 65 countries my wife and I have been to.  Go and see… and learn.

Perhaps to assuage the concerns of some family members who were concerned about that particular intellectual odyssey, this year’s goal is a deep dive into Biblical history. Not the stories and history IN the Bible, but a secular investigation of the history OF the Bible. I’ve read probably a dozen books written by respected scholars – from multiple perspectives since the historical accounts are far from settled.

What an unexpectedly fascinating journey! Humor me for a couple paragraphs while I expose my inner geek.

There are over 200,000 variants among 5,700 ancient Greek Biblical manuscripts alone, not even counting translation issues derived from them, created by the copying processes of amateur and professional scribes that were in some cases an attempt to please their benefactors and in others just plain sloppy. Most are minor and fairly inconsequential, but some aren’t, for example the last twelve verses of Mark and John 7:53-8:12 which are not found in any of the oldest manuscripts and are now assumed by scholars to have been added by scribes.

Compounding the intentional and unintentional copy and translation errors was the process of deciding what went into the Bible. From hundreds of potential texts, through lists developed by high profile folks including a disingenuous ship merchant in the second century (a great story itself), to the synod of Hippo and councils of Carthage, Nicaea, and Rome in the fourth century where in some cases the politics of church control outweighed what was effectively an exercise in hindsight called the five guidelines of canonicity.

Just when things seem settled, for better or for worse, there were the discoveries of the Muratorian fragment in the Vatican archives in 1740, the Nag Hammadi texts in 1945, and the Dead Sea scrolls in 1947 to both confirm and throw doubts on some of those early decisions.

History, perhaps especially religious history, has a way of being filled with more intrigue and drama than any novel written by even the best writer. Without getting into off-topic details, I will say that this year’s quest has actually reinforced my own faith.  Finding errors, and especially the process to understand the source of errors, can create authenticity.

So let’s get back to Thomas Merton and the interesting connections between the dots – yes, eventually including Lean.

Thomas Merton and Dalai LamaI first came across Thomas Merton during my deep dive into Buddhism a few years back. I was surprised to discover a large number of Christian scholars and Catholic priests, like Merton, who openly embraced components of Buddhism. Merton went further than most, with deep study into the Zen tradition, which he discussed in Zen and the Birds of Appetite, as well as a book he co-authored with none other than the Dalai Lama, The Way of Chuang Tzu.

At the core of Merton’s interest was his belief that most Christian traditions had become so focused on ritual and dogma that they had forgotten about the quest for understanding and a true personal relationship with the ultimate source of that knowledge.

He embraced, both in his writing and his own spiritual journey, the fundamental Buddhist concept that there is no single, perfect path, and that each of us has to learn and understand ourselves before creating our own unique journey.  That does conflict with many Christian and especially the Catholic traditions.  But, as we’ll soon see, not all of them.

Hence why it was remarkable that Pope Francis lauded Thomas Merton, a Catholic priest that believed in multiple paths to salvation and once said “I see no contradiction between Buddhism and Christianity. I intend to become as good a Buddhist as I can.”  Wow.

Allow me to add another dot. For most of the current era the Gnostics were more commonly known as “those crazy Gnostics.” Strange rituals and beliefs, loosely associated with Christianity, their scriptures quickly discarded by the early Vatican councils and not included in the traditional Biblical canon. Then the Nag Hammadi texts were found in 1945 and fully translated a couple decades later (interestingly with financial support from none other than the noted psychiatrist, Carl Jung), suddenly supporting some of earliest known manuscripts that had been deemed too controversial by the early church.

Contrary to the prior perception of Gnostics, these newly-discovered texts described a spiritual belief system far more aligned with traditional Christianity than originally thought, with one of the major differences being they did not insist that everyone must believe as they did.

To the Gnostics, faith is an inner experience, still generally aligned with classical Christianity, but one that does not have to be the same for everyone, and is grounded in individual investigation, introspection, reflection, and circumstance – as opposed to ritual. It is a dynamic process of seeking truth, not arrogantly declaring it.  Starting to sound familiar?

And this, finally, becomes the tie back to Lean.

Almost daily I come across articles, questions, and comments about the “true path to Lean” – and the supposedly correct sequence of tools performed in the singularly correct fashion to accomplish a transformation. That misconception is what, along with not understanding the respect for humanity pillar, causes most Lean failures.

Like the spiritual journeys of Buddhists, Gnostics, and many Christians like Thomas Merton, when on a Lean journey you must first seek to learn and understand, contemplate and reflect on how it applies to your circumstance and beliefs, and only then apply what makes sense to create your own path.

Learn about Lean, create a relationship with the underlying knowledge of Lean, and apply it based on circumstance, data, and beliefs. Don’t simply accept what others say or copy what others do.

Living is the constant adjustment of thought to life and life to thought in such a way that we are always growing, always experiencing new things in the old and old things in the new. Thus life is always new.
― Thomas Merton, Thoughts in Solitude

Learn and experience new things.  Live.  Create dots.  If you create a lot of dots, sometimes interesting connections can be made.

Discovering the Value of People

By Kevin Meyer

Big news in the business world:

Wal-Mart is famous for keeping costs down, including employee-related costs. In Joplin, the company is testing a new approach: investing in workers through higher wages and training, on the theory that this will pay off all around—for customers, the company and employees.

Yes, at just one of their 4500 stores, Wal-Mart has discovered skills training.  If it works they plan to roll out this innovative program to the other stores.

That isn’t a story from 1975 or even 1995.  It’s from this past week.  September, 2015.  Good for them, though, even if they did take a few decades to realize the potential value of people.  A concept that many other companies in many other industries have leveraged to create competitive advantage for a long time.

Pretty much every organization has a mission statement, often gathering dust on the wall in a corner of a conference room, that says “our employees are our most valuable asset.”  Really?  How is that demonstrated?

I bet Whirlpool had a statement like that, as they were laying off thousands of highly experienced people at their Fort Smith plant to chase “cheap” labor to a new facility filled with new inexperienced people in Ramos Arizpe, Mexico, while hiring at their nearby Clyde plant, and then only a couple years later they started looking for people to refill a plant they had closed.  You can’t make that stuff up.

But that’s what happens when you run a company based on traditional accounting methods, where labor is purely a cost and there is no offsetting P&L or balance sheet line for the value of people.  There’s a benefit to reducing cost, there is no balancing benefit to preserving the value of brains.

It takes a strong manager to realize that those brains are creating value that more than offsets their cost, even if it isn’t directly shown on the financial statements, and to buck the questions of their bosses and financial folks.  It takes an even stronger and more capable leader to invest in, develop, and mentor those brains to really tap into the potential value.  Organizations that have such leaders understand the problems with traditional accounting.  As a side note, you can learn more about those problems, and get to know some of those leading organizations, at the Lean Accounting Summit next month.

Truly empowered high-performing people can have an impact far beyond improvements in productivity and quality.  Consider your perception of the Chipotle brand after reading this article about a fatal accident that happened in front of one of their restaurants.

She [Chipotle shift leader] appeared to be in her early 20s – not much older then her direct reports or the victim of the accident. Yet, she acted with the compassion and appropriateness of a far older leader.

The next day, I called the Chipotle restaurant to offer my appreciation to the store’s manager. I told the leader how supportive, flexible, and respectful the Chipotle crew was to all in attendance.

As our phone conversation drew to a close, I said, “I know that our presence last night was not what you expected. We no doubt hurt your business.”

Before I finished my thought, the store manager responded, “There are a lot more important things in life than making our numbers last night. I’m just glad we were able to be there.”

Great people, led by great leaders, create great companies.  As Richard Branson says, “Clients do not come first.  Employees come first.  If you take care of and develop your employees, they will take care of the clients.”

I was thinking about a sandwich for lunch, but I think I’ll head down to Chipotle for a veggie burrito.

Owning Numerical Ignorance

By Kevin Meyer

Earlier this year I discussed the value created by writing by hand.  By writing on whiteboards or scribbling in a notebook, ownership, learning, and understanding is created.

Similarly, truly understanding numbers creates ownership, learning, and understanding – thereby creating the potential for action.

I’m not talking about statistics or the interpretation of statistics.  We all know that different perspectives can be “created” from otherwise accurate data to tell any story.  Just ask anyone in Washington – from any side.

I am talking about numbers that don’t accurately reflect underlying conditions, or numbers that don’t relate to the reality of the process owners.

gas price in CaliforniaAs one example, here’s a photo from my local gas pump here on the central coast of California, just today.  As my brother in-law remarked while visiting from Michigan last week, “that’s not per gallon, right?”  Yep, per gallon, typical for all gas stations around here, and yes far more than most other parts of the country are paying.

Most Californians are used to it, most U.S. visitors from outside of California just look wide-eyed, and most visitors from Europe still go “wow, that’s cheap.”  But how many understand that while everyone pays 18.4 cents in federal gas taxes, each state is radically different in terms of state gas taxes… taking California’s gas tax to over 60 cents a gallon, among the highest in the country?  How many understand that California requires a special gas formulation in the summer, produced only at in-state refineries, reducing scale and increasing risk from at-capacity refinery downtime, contributing to nearly an extra dollar per gallon in cost?

My point isn’t whether this price is too high or not – perhaps our air is cleaner due to special gas and perhaps our roads are better due to higher taxes (my brother in-law actually thought so) – but having the basic information in order to analyze that value relationship.  In order to create simplicity, a laudable goal, critical information and knowledge is lost.

Another example: home water use is typically measured in “units.”  Here’s one article from last Sunday’s paper on water usage here in California, obviously a popular subject.  What the heck is “25 units of water?”  To make matters worse, a “unit” is different in different parts of the world.  Here in the U.S. it’s typically 100 cubic feet, or 748.5 gallons.  Elsewhere it’s a cubic meter, or 220 gallons.

But who relates to a “unit?”  Here in California, where we’re being asked to reduce water usage by 25%, how do we relate to the numbers we see on our monthly bill?  I’m being asked to reduce water use from 10 to 7.5 “units.”  Whatever.  But ask me to reduce by 1871 gallons a month and I start to think about shorter showers, low flow toilets, changing from grass to a more natural drought-tolerant landscaping, and so forth.  Especially if my cost for those 2.5 units is about to skyrocket.

I understand it, I own it, and I can learn how to improve.

One final example: individual income taxes.  Romney stepped into it a bit during the last election cycle by stating that 47% of taxpayers pay no federal taxes.  A little misleading as all except for 14% (primarily the elderly) do generally pay federal payroll taxes for Social Security and so forth – just no direct federal income taxes. Still, the point that nearly half of taxpayers don’t contribute to a general expenditure bucket they have voting control over and receive benefits from is an interesting point outside the scope of this post.

But how many of those 47%, and even the rest, really understand how much taxes are being paid and especially how they are being used?  For the vast majority of people taxes are simply lines on their pay stub, generally ignored, and an annual reconciliation effort where they are often excited that they gave a loan to the government and now get it back, without interest.  Probably even more so now that paper pay stubs are becoming a rarity, and people have to take action to log into a system to review an online pay stub.  How many really do that?  How many can tell you how much they pay every two weeks in federal, state, Social Security, disability, and other taxes?

The net amount becomes the reference value.  Just like the gross amount is the reference value for gas prices.

Those of us who are self-employed or own companies are a little different since we have to actually cut a physical check to the Feds (and state) each quarter.  Ouch!  Now it becomes reality, and you start to be very interested in how much it is and how it is used.  Although it would be a bureaucratic and compliance nightmare, perhaps everyone should have to physically write a check, withdrawing real money from your account, instead of simply accepting the net deposit?  If you have to give up the equivalent of a vacation, a dinner, or even a beer to make that payment, it becomes real.

Ownership, understanding, and learning is created.

So be careful with simplifying numbers.  While simplification is a great goal, too much simplification may remove knowledge and create dangerous ignorance.

You’re Good When You Think You’re Bad

By Kevin Meyer

Well over a decade ago I created my first lean enterprise assessment, just as a tool to help me understand gaps in my organization.  I’m generally loathe to use such tools as they are often misinterpreted, gamed, or whatnot – but so be it.  It’s a tool and just a tool.  Coincidentally that first assessment tried to measure the use of lean tools, which led us down the toolhead path – and smack into a wall.  We learned our lesson, and began asking “why” and then “how” before choosing the appropriate tool for the problem.

Over time that assessment morphed into something that tries to measure behaviors and perspectives, not tools.  It’s fairly lengthy, but still very well-received.  And scary, as it is virtually impossible to receive a high score unless you have implemented lean from your suppliers through to your customers, and truly created a culture of continuous improvement.  There are forty questions in four sections: respect for people and community, creating customer value, leadership and alignment, and accountability and results.

Note: If you’d like a free copy of the assessment, just sign up for a Gemba Academy 7 Day Trial.  In addition to being able to preview all 750+ lean and six sigma training videos, you’ll receive a link to download a PDF of the assessment.  

Gemba Academy subscribers receive access to an editable version, deployment and analysis tools, and the accompanying Lean Enterprise Strategy Kit.

But my point isn’t to pander those tools.  Along the way, both in my organizations and in the hundreds of others that have used the assessment, I noticed a common trend:

  • First assessment: high score
  • Second assessment (generally 1 to 2 years later): much lower score
  • Third assessment: static to even lower score

Most people wouldn’t consider that to be progress.  How can you get worse?  But think about what’s happening.  And that’s fundamentally why the assessment is just a tool – it helps you prioritize areas to work on.  Nothing more.

Before starting down the lean journey, most organizations think they’re pretty good.  Inventory?  Helps buffer issues obviously caused by suppliers and anyone except ourselves.  Obviously.  Waste?  Comes with the territory because our products and processes are more complex, different, inherently unstable, “artsy,” etc. (pick one).  People?  Can’t be trusted.

So they look at the assessment, especially the first one that didn’t try to point out such fallacious fantasies (!), and skew it higher.  In their own minds.  Or consider it an impossible utopia.

Then, if they have a solid lean leader, they start to learn.  They visit other real lean organizations, attend seminars, workshops, conferences, and perhaps even training programs by the likes of Gemba Academy.  And they start to realize how far down the totem pole they are.  That’s fine, as long as they start to improve.

As they learn, they discover even more areas for improvement.  As they drain the inventory swamp they uncover more problems.  As they train their people – and learn to respect their brains – more opportunities arise.  And they feel even worse.

They try a lot of tools.  Perhaps judiciously, but probably without a lot of forethought.  Many of those tools fail – but they were tried.  And over time as appropriate problems and opportunities present themselves, they remember and apply them again with success.

Nearly a decade later the organization sometimes feels horrible – almost like a failure.  There are so many issues, so many problems, so many opportunities.  So many tools have been tried and abandoned.  But let me tell you about one such organization – and I know because it was the one I ran for over eight years, and I’m damn proud of those people.

That organization trains on lean, has a solid 5S program, uses manual and visual systems to manage production across three facilities instead of shop floor MRP, has reduced lead times by 90%, has morning standup meetings in all key departments, is rated best-in-class for quality by its major customers, and outcompetes its “low cost country” competitors – on price and quality – from the not-so-cheap state of California.  TWI is used extensively, autonomous teams have been deployed, and ridiculous budgeting processes have been eliminated.  It hosts tours and workshops by AME, local and state business groups, and in all cases there’s a big “wow!”  It was even successful enough that it built a new 120,000 sq ft facility – in California in the middle of a recession no less – that leverages massive reconfigurability concepts.

But in their minds, they have so, so far to go.  The journey seems to get longer and longer.  They don’t want to apply for prizes or awards – there just isn’t the time because there are so many issues to work on.  Certifications?  A rainbow of belts?  Nowhere.

The more you learn and the more you improve, the more you understand how far away perfection really is.  The depression of excellence?  Until you remember those days long ago, when you smugly thought you were great.

The Value of Uber and Airbnb

By Kevin Meyer

The following is not an advertisement, even if it sounds like it. I will admit I am a big fan of Uber and use the service pretty much anytime I travel. Now that they’re in my relatively small town, I might start using the service instead of paying for airport parking, especially on longer trips.

After dozens of rides I have yet to have a negative experience. The cars are new and clean, the drivers well-dressed and polite, and the cars arrive on time and within minutes of being requested. In Seattle a few weeks ago the car was a new Tesla, a few weeks earlier in Jacksonville it was a BMW 7 series. The convenience of having the financial transaction handled by the app eliminates the need for cash and negotiation. Sound like any taxi ride you’ve had? Ever? Nope. Welcome to disruption.

This misnomer of “sharing.”

Services like Uber, Airbnb, and others are often called the “sharing economy.” That’s an incorrect characterization. No one is sharing – both parties are out to obtain value. Micro-scale demand is being matched with micro capacity. Such demand and capacity has always existed, however it took real-time computational power to match them in a dynamic fashion that creates value for both parties.

Instead of a batch of taxis prowling the streets in search of fares, a single limo driver with an hour to kill between assignments can now fill that gap – that capacity. Hence why you often get nice rides like Teslas and BMWs with drivers in suits. At peak times fares go up, incenting an increase in capacity to match the increase in demand… instead of making the demand wait for hours in the rain.

The value to our environment.

The impact of this micro-scale demand and capacity matching is huge – and one that should be embraced by capitalists, socialists, and environmentalists alike. Uber, as of six months ago, is providing one million rides per day (yes, per day).  Airbnb has over one million rooms in its portfolio, and is doing 37 million room-nights per year of bookings. More that some of the world’s largest hotel chains.  And that’s last year’s data.

How many fewer cars, guzzling gas and expelling fumes, are on the streets because of the short-term capacity of unused limos and even private vehicles being freed up?  One million rides a day equates to a lot of cars.  How many fewer hotels, consuming utilities whether empty or full and contributing to urban heat islands, have been built because of the micro capacity of unused private rooms being freed up?  37 million room-nights is a lot of hotels.

The value is growing, but isn’t all roses.

New such services are being created every day.  You’ve seen all of those cranes and other pieces of construction equipment that sit idle for days at a time?  No longer, thanks to Yard Club.  Tutors, house cleaners, private aircraft. You name it.  Have a short term availability?  Match it to someone that needs it now.  Sometimes it can go even deeper, such as with same-day delivery services partnering with the likes of Uber and Lyft to further improve their efficiency and reach.

Sure there are issues, although many of those are more political than real.  Uber’s background checks are more extensive than taxi drivers… except in some key states  and countries like California and South Korea.  Airbnb does pose an issue for cities resting comfortably – until now – on hotel room tax receipts.  Those problems will eventually be resolved, just like they have been in the past when innovation disrupts the status quo.  Sometimes it won’t be pretty, at least for a while.

The potential value to you and your organization.

But let’s take the concept of matching micro capacity and micro demand to an even more immediate, direct level.  Where do you have a few minutes of potential capacity in your day that can be filled by creating value – recognizing that value is sometimes the mindful pleasure of just sitting on a beach or enjoying a long lunch?  Where can what seems to be larger chunks of demand by a group in your organization be divided and filled by smaller chunks of capacity?

How do most meetings, CYA policies, ego, and lack of training or even trust affect your ability to match internal organizational demand with capacity?  Does your organization look like a batch of beat up taxis driving around in search of demand, or smartly-dressed drivers in BMWs efficiently filling a few minutes of available time with a person willing to pay above par for that value?