The Journey to Lean-Lean: Part 1 "Houston we have a problem"

Today I begin to share with you my experiences as I embark on what could turn out to be the most terrifying and wonderful experience of my professional career.  After 20+ years spent accompanying my clients through their journeys of organizational improvement I am turning my laptop on myself and my firm.  I do not know why it has taken this long for the idea to occur to me.  It could have been the five millionth article on Lean manufacturing that I read.  It could have been a comment that someone made to me.  Or maybe I just got tired of sounding like every other management consultant out there trying to convince potential clients that I can help them achieve unbelievable success if they just give me the opportunity (a.k.a. "purchase order").

Whatever the case I know exactly when I did realize that I had a problem.  I was driving in my car on my way to a client meeting.  Playing on my CD player was the book "Lean Thinking: Banish Waste and Create Wealth In Your Corporation" by James Womack and Daniel Jones.  Needless to say I was driving alone.

For those of you not familiar with this book what I will tell you is this.  It was in 2005 while reading this book for the first time, sitting in an airplane some 30,000 feet in the air, that I experienced a paradime shift in my professional life.  Everything I had learned and put into practice about improving processes suddenly fell by the wayside.  And I could immediately see as clear as the words on the paper how Lean Principles could be successfully applied in any organization, on any process, by any group of motivated people. 

But enough preaching, this is about me and my problems.

So back to me driving in my car listening for the dozenth time or more how every journey of Lean begins with identifying what it is that your customers Value.  And suddenly I had a terrible thought: "I have no idea what it is that my clients Value." 

Don't get me wrong.  I have completed many successful "improvement" projects in many organizations that have resulted in many satisfied customers.  But that wasn't my problem.  My problem was, even though I told myself and my clients every day that I was "unique and special" and my firm's approach to organizational improvement was "unique and special," the fact was I was doing management consulting basically the same way I had been taught to do it by the first consultants I had ever worked for.  And they in turn were doing it the same way they had been taught, and so on all the way back to Drucker.

To illustrate my point let me give you a brief summary of how to deliver a 'typical' implementation based management consulting project.  This will contrast to what 95% of consultants do which is write reports filled with recommendations, leaving the actual implementation of changes to the clients themselves.  But for the less than 5% of us who actually stick around to work with our clients to implement improvements it goes something like this...

1. Sales Meetings:  Conduct a series of 'sales' meetings with as many people as you can within the client's organization to collect as much information on issues as possible.  Introduce the client to as many impressive, well dressed, and extremely intelligent people from your firm as possible.  The more war stories these people can tell the better.  And if the stories even remotely relate to the potential client's organization, better still.
   
   Try to piece together the actual decision making process and available consulting budget.  Hopefully ultimately identify the one person within the organization with the authority to make the necessary purchasing decision.  Book a meeting with that person and then beg for the opportunity to come in and conduct a targeted organizational review and present a project proposal.
   
   
2. Project Proposal:  Now that you have passes to the building, albeit temporary passes, the next step is to bring in as many consultants from your firm as possible.  You want to bombard the client's organization with every conceivable form of analysis and data chugging imaginable.  And then pull a series of all-nighters (the more the better) so as to put together and present as compelling (and coffee-stained) a proposal as you can. 
   
   The challenge here is to free up people within your firm who are both brilliant and seasoned enough to be able to quickly evaluate a potential client's situation, while at the same time are somehow made available by your Operations group who are busy billing existing clients for every warm body they can put their hands on.  For those of you outside of the consulting industry this particular contradiction has caused internal battles within consulting firms starting from the first time Drucker's lead analyst requested resources from Operations to help sell his firm's second project.
   
   
3. Improvement Project: Assuming your over-worked and over-paid analyst was able to convince the potential client to become a current client the fun really begins.  If the people within the client organization were impressed by the level of study, scrutiny and analysis conducted before the project started, the level of intensity demonstrated by the on-site project team is enough to blow their minds.  Fueled by the ever-present fear of having the project canceled, the project team (proudly) works 20 hour days or longer to prove that they are worth every penny of the huge invoices submitted to the CFO week after week. 
   
   Of course the first thing to do is place the studies completed during the analysis phase aside and start from scratch.  To make matters worse, since there is typically anywhere from a few weeks to a few months between the presentation of the project proposal and the start of the project, chances are high that no one from the project team will have been involved in the proposal phase.  As one colleague of mine appropriately put it ".... it must seem like Groudhog Day for the client."  He is referring of course to Bill Murray's character who wakes up over and over again to the same day only to discover that he is the only one who realizes that it is the same day.  Rent it if you have time. 
   
   And so the project progresses.  Lean principles and many other proven techniques are gradually implemented within the client's organization.  Here the causes for delays tend to rest with the client resources themselves and not the consultants.  In most cases the consultants must compete for Subject Matter Expert's attention along side all the day to day operating issues that come up.  Only in rare cases does the client assign full-time resources to the project.  More often these hardworking individuals end up working long hours to cover off their regular job, in addition to the demands of the consulting project.  This lack of direct involvement also leads to more work for the consultants.  Because they are the only ones conducting the studies and analysis it becomes a major challenge to convince the client as to what improvement should be made.  Fortunately management consultants develop spectacular and truly innovative ways to present complex concepts and ideas.  The purpose of these is to ultimately convince the client, who is too busy dealing with day-to-day issues, that major changes need to be installed.
   
   But in the end at least some of the changes are made, in most cases the results are achieved, and the project is successful.  There are usually a few dinners or nights out to celebrate the end of the project and say 'good-bye' to new friends and colleagues.  Then the printers and power bars are packed up and the project team moves on to their next assignment.
   
   
4. Sustaining the Results: The final step in the consulting process is an odd one.  What makes it odd is that most management consultants will tell you that the sustainability of their results is the single most critical aspect of every engagement.  In fact I challenge you to find company literature for an implementation based firm that does not describe in great detail how sustainable their results are.  And to prove this they will trot out lists of satisfied past clients who will attest to just that. 
   
   However at the same time the reality for most firms is that almost no effort is spent ensuring the sustainability of results once the printers and power bars have been packed up.  Remember everyone involved in the project moves on to their next grueling engagement with 20 hour days trying to convince a new CFO to pay their invoices.  Even if they wanted to there is little or not time or energy left over to ensure sustainability of their past projects.
   
   
   If asked, most consultants will sheepishly admit that they may exchange emails with former clients from time to time.  But the reality is, the more time that passes from the end of a project, the more every one of us shudders at the thought of a prospective client calling up a past client to see "how things are going."
   
   

So there you have the basic process for delivering an implementation based consulting project.  I would love to hear feedback at this point from both clients and management consultants.  Just as a consultant's perspective of the level of opportunity within a particular organization will differ significantly from the perspective of those who work there day after day, so to does the perspective of the degree of opportunity within the consulting process differ between consultants (who do this day after greuling day) and those outside the industry.

This was very well demonstrated after I recently posted the question "What do our clients value?" in a Lean Six Sigma discussion group on LinkedIn.  I was bewildered and bemused at the overwhelming number of responses from highly intelligent (and presumibly successful) management consultants who tried to coach me on how to be a Lean Management Consultant.  It was only a very few who understood my question and attempted to define the Value we provide.

When you consider how these people (and me for that matter) make money it makes sense.  The larger the consulting project the more money you can charge.  As one colleague put it; "why would you want to do a project in less time and for less money?"  Wow.  Can you imagine Toyota (or any firm for that matter) deciding to maximize Revenue by leaving as much Waste in their processes as possible?

I know, right?

So there you have it.  They say the journey of 10,000 miles begins with a single step.  And the first step to solving a problem is admitting that you have a problem.  Houston we have a problem.

Get Off Your Butt And Start To Manage - For Pete's Sake!!!

I colleague of mine recently sent me a link to the following interesting article: Boosting the productivity of knowledge workers available on the McKinsey Quarterly web page.  They sent it because we had a long talk about my recent efforts to do what we have done for so many of our clients - start our own firm down the path towards becoming a LEAN organization. (more on this later...)

We talked in great length about what constitutes Value to our clients and what constitutes Waste or Muda.  If conventional Lean thinking can apply to a management consulting firm them 80% or more of our effort should turn out to be Waste as defined by our clients.  Needless to say this exercise has quickly turned into a monumental struggle of wills and rock solid beliefs  both among my esteemed colleagues and, of more concern, within my own mind. (again, more on this later...)

Back to the article.  For those of you who do not wish to register as a member of this web page let me simply say that the folks at McKinsey have come up with five interesting causes of lost productivity for knowledge workers.  They are as follows:

1. Physical barriers
2. Technical barriers
3. Social and Cultural barriers
4. Contextual barriers
5. The barrier of time

How you can call "time" a barrier to "time" still has me stumped.  However as I mentioned it does make for interesting academic reading - especially if you are looking to impress your fellow managers around the water cooler.

I am actually not writing to help promote McKinsey's web page.  I am writing to share my response to this article which may or may not be published by McKinsey.  For what they may be worth my two cents were as follows:

All these barriers are great and probably true. But what happened to good old fashioned hands on management? We find the higher the 'tech' the more these people are left to fend for themselves. A common phrase among management in these knowledge areas is "I don't have to manage them - they should know what to do."

This attitude, combined with the staggering complexity in which these knowledge workers exist is the Perfect Storm for lost productivity. In one particular example I have seen actual productivity calculated at just over 12%.  This for an office in the Finance sector with more Armani than a TIFF after hours party. 

Why does everyone feel it is perfectly acceptable to tell a factory worker that they have to complete 100 units by the end of their shift. Yet no one dares tell an engineer or a software developer that they need to complete a certain milestone by the end of the day.

One forgets that the purpose for 'managing' employees in this way is to give them the respect of ensuring that they have everything they need. Just as the factory worker has the opportunity to point out that she is starting to run out of packaging material. So to the engineer can point out that he is still waiting for a critical design document from another department. Why should the engineer lose productive time having to chase down missing information instead of getting on with the task at hand? Because they're more educated?

Give me a break. Management needs to stop looking for the 'silver bullet' - as one person noted. And get out of their offices and start doing their job of actively managing resources.

Thank you for reading.  And please tell me I'm wrong.

Grade School Track Meets Could Use Management Consulting

I attended a grade school track meet a few months ago to watch my son and daughter compete in several events. They both did my wife and I and their grandparents very proud. But as I stood out in the hot sun hour after hour watching the organizers get further and further behind schedule my (consulting) mind started to wander.

I noticed that the meet was being organized mostly by high school students with a few teachers lending a hand. I asked a few questions and learned that the students were senior physical education students who organize the event each year as part of their school curriculum.

And then a thought occurred to me. Why wasn't the school business club putting on the event. Or one of the business classes. If anyone should be learning about how to plan things, manage resources, create schedules, respond to off-schedule conditions, evaluate performance and communicating results it should be the students studying to go on to business school and then become business leaders themselves.

A business class would have noticed that communication of schedules was very poor. As was the communication of where competitors were supposed to meet before their events. It would not take even a novice business analyst very long to map out the process of conducting an event:

1) Assemble competitors
2) Give pre-event instructions
3) Line competitors up at the starting point or event location
4) Conduct the event while keeping track of individual performance
5) Compile the results
6) Post the results

I saw absolutely no consideration given to even the basic LEAN manufacturing principles. And the resulting "lost time" or Muda was everywhere.

I realize the jocks probably rule the school as they did in my day. And I can just imagine how difficult it would be for a business teacher trying to suggest to a phys ed teacher or principal that their class should have a chance to organize these events. But this is one parent (customer) who could do with a little less waiting and a little more cheering.

Thoughts?

Send it back (always look the gift horse in the mouth)

A few years ago I was in the midst of implementing Lean Manufacturing principles in a Tool and Die job shop. One of the steps in the process involved taking rough-cut blocks of steel and machining them to various sizes. One of the first opportunities we discovered was that our supplier had a wide variation when it came to how much "extra" steel they would send us on the raw blocks. Even though we only paid for the "required" size, the extra steel meant wasted time on our machines and higher cutter costs.

We invited our supplier in to explain the situation and ask them what they could do to help. The representative agreed to help us by tightening up their tolerances. And he even thanked us for bringing the additional material to his attention. Because we only paid for what we ordered all the extra steel they sent represented additional material and shipping costs to them. He even went so far as to offer to "take back" any block that came in over spec.

Almost immediately we noticed a significant reduction in the time required to machine the raw blocks of steel. A few less millimeters of steel per side, times 6 sides per block, times several hundred of blocks a day made a big difference.

Then one day I was called out to the shop to look at a couple of blocks of steel that had just come in. At first the operators had been confused when they could not match two large blocks of steel to the Bill of Material. Then they figured out that instead of sending us two five-inch blocks of steel, the supplier had mistakenly sent us two 10-inch blocks of steel.

My Purchaser said he had called the supplier who had acknowledged their mistake. He went on to proudly tell me that the supplier had told him that rather than pay to ship the heavy blocks back we could "keep the extra steel free of charge" to use on another job. That worked out to almost $1,000 worth of free steel.

I instructed my Purchaser to "call the supplier and have him please take it back."

Why? Try to think of at least three reasons.