How to consistently build a Lean Culture

What is a Lean Culture is a great question to ask before going lean, since most failures are linked to missing the link between implementing tools and putting in place the relevant complete system according to your context.

1- What does the term Culture cover in the context of companies ?

The term « culture » takes its origin from anthropology from 1930 to 1970. It has then been applied to companies around 1970’s, getting more and more general and ordinarily. Culture definitions do cover three types:

  • Descriptive –through a complex set covering different habits taken by men and women living in communities
  • Historical –the culture covers heritage and transmission
  • Normative –the set of rules and regulations put in place to live together and guide behaviors.

Experts define a company culture as the expression of implicit and explicit norms, at administrative, behavioral and organisational level, ruling relationship between men and women building the organization. Two generic company cultures approaches can briefly give us references for our next steps.

The 7S Mc Kinsey defines an easy-to-remember 7 words starting by S definition for a culture. The culture is thus composed of 7 interdependent elements :

A central core element, the Shared Values: called “superordinate goals” when the model was first developed, these are the core values of the company that are evidenced in the corporate culture and the general work ethic.

3 soft elements:

  • Skills : actual skills and competencies of employees working for company.
  • Style : the style of leadership adopted.
  • Staff : the employees and their general capabilities.

3 Hard elements:

  • Strategy : the plan devised to maintain and build competitive advantage over the competition –strategy statements.
  • Structure : the way the organization is structured and who reports to whom- Org chart and reporting lines.
  • Systems : the daily activities and procedures that staff members engage in to get the job done –formal processes and IT systems.

Describing these 7 elements and working on them allows to define and evolve the culture of a company.

The Edgar Schein’s cultural model describes 3 different levels which define a culture :

  • The Artifacts are what we see from an external viewpoint : what is published, visible like processes, charts, the acted observable behaviors –dressing, physical layout…
  • The Espoused values are what people say,the conscious strategies, phlosophies, ideologies, goals and aspirations.
  • The Underlying principles are what people deeply believe and act on, the core, the essence.

Edgar Schein (1996) defines the culture as « the basic tacit assumptions about how the world is and ought to be that a group of people share and that determines their perceptions, thoughs, feelings and their overt behavior ».

In order to understand a culture, it is thus critical to spend time researching for the non tangible aspects, below the iceberg’s surface.

 

2- Toyota Production System is a cultural unique way to perform operations

The strength of Toyota Production System -TPS, that we could call the Toyota Way is that it’s a longlasting, starting from a japanese collective Eastern culture in automotive industry. Several books have been written on this topic, starting with Toyota Way by Jeffrey Liker, then Toyota Culture, from Jeffrey Liker and Michael Hoseus. However there is a large variety of continuous improvement or Lean cultures, and some different from Toyota.

Indeed Toyota is today the most profitable automotive company, since 2008. Yes, the compay seems to recover fast from its issues- recall of 23 million vehicles over 2009-2014 and as well Japan 2011 earthquake. The current very high raising profitability of 18 B$ and volume production (>10 million vehicles / year) are impressive.

And also balance these great figures with the fact that it remains with a strong discipline linked to Toyota historical culture and stays restricted to the automotive industry. As TPS is unique and has been built for the automotive industry market, it will work for some other organizations and not for others. The Toyota Way is a Culture, don’t try to imitate it, you’ll kill yourself ; As there is a Toyota Way to Continuous improvement, there are other ways to business and continuous improvement, like Virgin Way, HP Way, GE Way, 3M Way to innovation, Google Way. For instance, in 1995-2000, the GE Way in appying Six Sigma improvement at all levels allowed General Electric to be one of the most famous, diverse and proftable companies in the 1990-2000 decade.

As Elyahu Goldratt quotes in his bestseller management book « The Goal » which introduces the Theory of Constraints, only 20% of japanese companies have succeeded, after lots of efforts and trying many times, to implement a TPS-based continuous improvement approach in their organizations up to 2011. And in the USA, in Industry Week 2007 article, only 2% have achieved their Lean Transformation goals and 24% have some significant results –however different from initial expectations.

When people get to know about Lean as TPS, a first large majority of them will not get inspired by the lable it conveys in terms of industry, japanese culture. Then when they get to know the level of mastery Toyota has developed through it’s TPS, a large part of remaining people will get by it’s complexity.

 

3- ‘Going Lean’ means in fact to find your own way to continuous improvement culture

Why is the culture the foundations of change ? Let’s look at an interesting Lean Case Study : Applying it to NUMMI. The article explains interesting information from John Shook on NUMMI, which went from the worst to the best GM plant in a few months: http://sloanreview.mit.edu/article/how-to-change-a-culture-lessons-from-nummi/.

Only one tool of the whole TPS has been put in place, with a strong discipline : the Andon cord tool, in order to make everyone an expert problem finder and experimenter. And this completely changed the culture from ‘finger pointing’ to ‘problem solving’. This led John Shook to confirm Schein’s version that working on cultural artifacts is an efficient way to change culture.

There is addition and interesting parallel to perform between these 3 Schein’s cultural level evolution by acting on behaviors, and the NLP (Neuro Linguistic Programming) approach of the 6 logical levels of Robert Dilts: 1- Environment, 2- Behaviors, 3- Capabilities, 4- Values and Beliefs, 5- Identity, 6- Purpose. The NLP levels 1-2 could refer for Artifacts, levels 3-4 for Espoused values and 5-6 for underlying principles.

Robert Dilts states on the contrary that, in a blocked situation, we can only change in a person a low level (for instance 2- Behaviors) without having an action at a higher level such as: 3- Capabilities, or 4- Values and Beliefs. This would mean that NUMMI succeeded also because the whole management team worked deeply on the higher levels in order to instill a behavioral change: Purpose, Identity, and deep Values and Beliefs.

To integrate these previous elements, here are the successful process steps to proceed to a culture evolution:

  • First step, work on your Purpose, Identity, and deep values that characterize your unique culture.
  • Second step, define the actions and behaviors you want to see and stick to them drastically with the relevant tools –focused ones, not many tools.
  • Third step, design the work processes that are necessary to reinforce those behaviors. The « Toyota culture » from Jeffrey Liker and Mike Hoseus gives us a relevant of the main processes stream to change a culture:
    • HR processes: hiring people, training people, engaging people in Continuous improvement,
    • People support Processes: cross functional, work groups, clean and safe workplaces, visual management and two ways communications, servant leadership at the service of employees and their value added,
    • Organizational Supporting processes: Stable employment commitment and tools, HR policies and practices, Slow promotion and rewards, strategic policy deployment.

[/vc_column_text][/vc_column][/vc_row][vc_row full_width=”” parallax=”” parallax_image=””][vc_column width=”1/1″][vc_column_text]As a conclusion, in order to make your culture evolve for higher results, move your company from « envy » and « imitation » from other industries and benchmarks, to « inspiration » and « uniqueness » to progressively find the right balance between external benchmark and internal capabilities and key assets. No company has succeeded by copying, all extraordinary companies have built their own Way, find the way to build yours !

Ralph Waldo Emerson: « Envy is ignorance and imitation is suicide ».