Lean Connections

Perhaps you too have seen the recent survey by the Corporate Executive Board (CEB). 

Which way out?

Looks like 25% or so of the executives whom surveyed companies have identified as “high-potential” leaders plan to exit their respective companies within the next 12 months. Oops!  (Not sure how they actually got to this number – would you be telling your CEO of your plans to get-outta-Dodge?)  My guess:  the number is probably much higher.

So, is it too late for intervention? Can these organizations salvage the situation? 

The same survey indicates that an additional 21 percent (so now we’re looking at 45% total) of employees today (yes, your employees!) identify themselves as “highly disengaged,” and this percentage has risen, alarmingly, by about 300% since 2007.  Perhaps these statistics would be different today if more companies were doing some basic things a bit better, and if one of the foundational principles of “Lean Thinking,” respect for people, were at the core of their best people practices.

The CEB goes on to describe some tactics which companies might want to implement to re-engage and more effectively manage high-potential employees (though more progressive organizations might actually want to call them associates or team members):

• Stimulate — Emerging leaders need stimulating work, recognition and the chance to grow. If your company doesn’t provide these, they can quickly disengage.
• Test — Explicitly test candidates for internal promotion for ability, engagement and aspiration to make sure they’re able to handle the tougher roles as their careers progress.
• Manage — Having line managers oversee high-potential employees only limits their access to opportunities and encourages hoarding of talent. Instead, manage these high-potential employees at the corporate level.
• Challenge — High potential employees need to be in positions where new capabilities can — or must — be acquired.
• Recognize — High potential employees will be more engaged if they are recognized through pay, so offer them differentiated compensation and recognition.
• Engage — Incorporate high-potential employees into strategic planning. Share future strategies with them and emphasize their role in making them come to fruition.

Now, for you Lean Thinkers reading about these “new” insights, the CED prescription doesn’t really sound all that revolutionary, does it?  Maybe different words, yet very similar to what Lean Leaders actually do when they engage in “manager standard work.”   My guess is that Lean implementation, done the right way with people and continuous improvement in mind (not just thinking about tools), still has a long way to go in most North American companies.  Especially in those which will find the the CED survey and Harvard Business Review article revealing to them something which they apparently don’t already know.

Once again the general business press, writing about UC San Francisco, really has this all wrong. This is not Lean Thinking; it is not operational excellence; it is not “transformation.” It is misguided, misleading and, pure and simple, misinformation.  And it is undoubtedly dangerous for the credibility and passion of true operational excellence and Lean leaders and companies world-wide. Why do they write this stuff?

The first three paragraphs of this article appearing in today’s San Francisco Business Times caught my attention because of how seriously inappropriate it is to “dub” any initiative which will result in the elimination of 538 people as an operational excellence plan.   Who did the “dubbing?”

UC San Francisco, which faces a daunting budget deficit in this and coming years, is envisioning a restructuring that could slash up to 538 jobs over the next three years.

The game plan, dubbed “Operational Excellence,” could eliminate up to 35 central administration positions, up to 225 jobs in IT, 100 in human resources, 95 in finance and 83 in research administration, for a total of up to 538, according to a report sent to UCSF’s senior management in early April.

The proposed three-year plan aims to re-engineer internal organizations and processes, “transform” the IT department, integrate “service teams” in HR, finance and research administration, and create or save additional revenue through efficiency.  Read more: Restructuring at UC San Francisco could chop 538 jobs – San Francisco Business Times: 

(Note: I’m not an SF Business Times subscriber so I asked a Bay Area colleague to read me the rest of the story this morning; it didn’t get any better).

Why do some today still persist in equating business and operational improvement efforts with personnel cuts?  In a truly operationally excellent environment it’s all about continuous improvement and respect for people.  This way of thinking is just, as my Lean colleague Mark Graban puts it, L.A.M.E thinking!   We saw some of the same previously when the Wall Street Journal published a front page story about Lean apparently gone wrong at Starbucks. Why won’t this misguided thinking just die?

In his report of March 24, 2010, An Update on UCSF 2011: A Focus on Operational Excellence, UC San Francisco Chief Business Officer John Plotts sets a much clearer and more accurate tone regarding the true meaning of improvement efforts:

It is important to note that while the challenges in front of us demand immediate attention, it is in the University’s best interest to view these challenges as an opportunity to commit to a new way of doing business that encourages the continual examination of what we do and to ask, “Why do we do this? Is there a better way?”

By dedicating ourselves to continual improvement – this year and in the years to come – we can be sure that UCSF is well run and that our resources are supporting our top priorities:  patients and health, discovery and education.  Committing to excellence in all we do will allow UCSF to be the best university we can make it.

Bravo, Mr. Plotts, for being a Lean Thinker, And that’s the way I see it.  Adam Zak