I get annoyed when I hear purported business improvement “experts,” especially those at large consulting firms, make inaccurate statements about lean.
What currently has me annoyed are statements coming from Ovum, a global consulting firm owned by Datamonitor. Dr. Alexander Simkin, described as an IT Services senior analyst and process improvement specialist at Ovum, said recently that when we have reached the depths of a severe recession, it may be “too late” for lean.
He argues that lean implementation takes too long and is too resource-intensive for an organization currently reviewing its IT processes, and therefore does not offer the rapid efficiency gains that CFOs are increasingly demanding of CIOs.
“What they don’t realise is that becoming Agile or Lean takes time and requires major change management. If you’re starting from a base of traditional processes, these approaches won’t provide rapid cost reduction. The efficiency of your processes may even get worse before they get better. CFOs need to know that and it’s a CIO’s job to educate them.”
Simkin doesn’t spell out what he believes would achieve rapid cost reduction. Does he mean layoffs (which typically get rid of people with valuable knowledge an experience)? Or seeking lower-cost suppliers (which may lead to quality problems and undermines the trust needed in supply chain relationships)? Or outsourcing production (which can create quality and lead-time problems)?
Good luck with those.
There may be a small grain of truth in Simkin’s statement, in that, with lean, processes may appear to get worse before they get better (but not always).
However, the more important point is that well-executed lean initiatives increase capacity, improve quality and – yes – reduce costs, and can do so rapidly. The trick is doing it right.
Simkin claims that he is not against lean or Six Sigma. He suggests they may be a good approach when the economy improves. Too bad he doesn’t understand they also make sense now.
I guess I would call him a fair-weather friend of lean.