The Changing Face of Startups?

I was quite happy that, during this past month, I got the chance to speak to Boyd Cohen -- one of the foremost climate strategists helping to lead communities, cities, and companies on the journey towards the low carbon economy -- about his most recent book, Post-Capitalist Entrepreneurship: Startups for the 99%. His thought-provoking book challenges many of our underlying assumptions about how entrepreneurs form startups and the objectives and roles (or lack thereof) of startup investors in a post-capitalist society.

During our conversation, I asked him: “Why has there been such a radical change in the dynamics of startups?" Here is his response:

Several factors have been evolving and even disrupting the startup scene during the past 5 to10 years. The democratization of the tools of innovation have led to massive reductions in costs, time, and barriers for startups. This includes the proliferation of cloud computing, Software as a Service, and co-working spaces.  But furthermore, the growing number of technologically unemployed and the resentment and frustration with growing inequality has given rise to a new breed of entrepreneur who is less focused on private ownership of land, capital, and human resources (the basic tenets of capitalism) and instead focused on inclusive, open, and collaborative business models, such as platform cooperatives and commons-based peer production. The highly disruptive, and distributed capabilities of blockchain even further these trends, opening up opportunities for alternative currencies and initial coin offerings (token sales) as well as automated distributed autonomous organizations where no intermediary monetizes transactions between peers. 

What do you think of Boyd's perspective? What are your thoughts on entrepreneurs who are pursuing radically different approaches to value creation and extraction?  


Total Productive Maintenance (TPM) and Lean Maintenance -- What's the Difference?

“What is the difference between Total Productive Maintenance (TPM) and Lean Maintenance?”

That's the question I just posed to Torsten Dederichs, who just published a new book entitled Lean Maintenance: A Practical, Step-By-Step Guide for Increasing Efficiency with Javier Girón Blanco. Considering the amount of money industrial companies spend maintaining their plants and  maintenancing their equipment, I figured it'd be best to include his entire answer here:

What is the difference between onions and apples? Onions are vegetables and apples are fruits.

The first principle of TPM is that the operator is the first line of defense against unplanned downtime. Because operators know their equipment best, they can identify problems long before they get critical. This approach is  a very valuable approach for increasing reliability and reducing  wasted time and repairs.

But what happens when the operators cannot solve the issue themselves? What if the repair needs skilled crafts or engineers? The operator raises a maintenance notification, which launches the maintenance process. And in this same second the operator leaves the TPM world and hands over his engine to our “Lean Maintenance” approach.

Maintenance technicians are the "go-to folks" when machines break down. They are modern-day heroes who can fix anything at anytime. The role of the “hero” becomes evident when maintenance starts to work in a predominantly reactive mode, fire-fighting its way through the day. At this point,  employees begin to view maintenance as a necessary evil because it is basically a cost center that requires management attention as well as capital (spare parts inventory) and personnel. This sentiment is exacerbated when maintenance is performed “at all costs” -- work orders take more time, money and effort to get done, budgets are exceeded, and an unhealthy relationship develops between maintenance and production. At this point, upper management starts to consider ways to get costs under control: top-down cost reductions (meaning that less maintenance gets done, with the corresponding availability risk) and partial or total outsourcing. These measures can provide a quick fix but will not resolve the firefighting nor fix the broken relationship between maintenance and production. This situation can lead to frustration, as things go back to where they were before. To break this vicious circle we propose a different approach.

Maintenance can be a source of profitability by ensuring high availability. As mentioned previously, companies with an efficient and effective maintenance function have a clear competitive advantage. A Lean maintenance function ensures that all resources are dedicated to value-adding activities, taking out the process “waste,” and being able to do more with the current resources.

To achieve Lean maintenance, many elements must be in place: the interfaces between production and maintenance along the full maintenance process must be smooth and maintenance work must be properly selected, prioritized, planned, scheduled and carried out. Everyone involved in the process should know how he or she can contribute to this goal.

The description of the ideal maintenance process and the method for achieving it is the focus of Lean Maintenance: A Practical, Step-By-Step Guide for Increasing Efficiency.

What do you consider the differences between TPM and Lean maintenance? Have you practiced Lean maintenance in your company?  


Do Misconceptions About Lean Cause Many Initiatives to Fail?

At conferences, in magazine articles, and in books, we often hear of the benefits that Lean initiatives provide to organizations' efficiency and general workplace culture, but the failure rates are never comprehensively analyzed. In August, Cordell Hensley published an interesting new book, Lean Misconceptions: Why Many Lean Initiatives Fail and How You Can Avoid the Mistakes, that sheds light on why more than half of performance-improvement initiatives fail to achieve desired results.When I spoke with Cordell last week, I asked him: "What are the common mistakes that cause Lean initiatives to fail?” Here's the answer he provided:

The focus on removing waste is fundamental within Lean, but it should not be the only objective when beginning on your journey. Many organizations think simple: Lean = less waste. While this is true, it is like saying the TARDIS is just a police telephone box.

For example, I am always surprised by how few have heard of MURA (unevenness) or MURI (overburden). These are as, or potentially more, important than MUDA (waste). These other two create waste; and if you don’t focus on removing unevenness and overburden, then your efforts to reduce waste will be in vain. 

In addition, while removing or reducing waste is fundamental within Lean, I argue that it is too easy to ignore or skip the objective of creating capability. I’m not talking about getting a few experts in or training your leadership team but actively engaging everyone in the thinking behind what you’re trying to do.

Lean provides the impetus for challenging the status quo, for seeing every process as something that can be improved, including the improvement process itself. Arguably, improving processes is the easy bit, and identifying waste is relatively simple as well, but it is the change of focus of every employee to solving problems that only comes from a shift in organizational thinking. It is a shift from an organization where employees do as they’re told by management to one where they are engaged in making things better, for everyone, including the shareholders.

Today’s leaders seem to want an answer to their problem that they can buy “off the shelf.” This doesn’t exist! There is no silver bullet or panacea  that can fix  problems or improve performance for every business. The results they seek are readily available, but it takes effort, it takes learning, it takes a shift in paradigms.

Lean has been around for several decades. It evolved from research on Toyota followed by the application by hundreds if not thousands of organizations and their consultants. Many users and “experts” within organizations, however,  have modified and adjusted the thinking to suit their immediate needs. This has created misconceptions within the industry and has denigrated the term to little more than a process improvement technique. 

This evolution has, in most cases, reduced the potential that organizations can achieve and has sadly been used to put many thousands of people out of work. Throughout my book, I try to demonstrate a different view of Lean and the culture desired to enable organizations not only to improve their processes and systems but also to create the capability to learn and adapt to the ever-changing world in which they operate.

What do you think of Cordell's perspective? Have you been involved in a Lean initiative that has not lived up to expectations? What do you think are its shortcomings?


What New Engineers Should Know About Problem Solving

Melisa Buie, the director of operations at Coherent Inc., published a very helpful book for new engineers just entering the workforce entitled Problem Solving for New Engineers: What Every Engineering Manager Wants You to Know. The book focuses on developing a strategy for minimizing, eliminating, and finally controlling variation.

During a recent conversation with Melisa, I asked her: “What hinders new engineers most regarding problem solving?” Here is her complete response:

Problem solving requires a paradigm shift for most scientists and engineers when they transition from the academic world of memorization, retention, and recitation of knowledge to a creative more fluid kind of thinking. From our pre-kindergarten interactions to the day we graduate with a BS or MS degree, we are taught that knowledge rules. Knowledge is the most important thing. In school, the person who knows the most wins or gets the ‘A.' We are taught that knowing is the most important thing. Knowing is valued most.

In school, that knowledge is gained from our books, from our professors, experts, or journals. We participate in science through demonstrations and labs, both of which are scripted with known results. We are told when to watch, when to pay attention, and when to record our findings. These experiments are then recorded in nice packages called lab reports and graded. Our grades are determined by the care we take in recording our findings in the templates provided. Our labs are recipes that we follow.

Helen Keller wrote: “The more I handled things and learned their names and uses, the more joyous and confident grew my sense of kinship with the rest of the world.” Problem solving is about handling things and gaining kinship with the world. Problem solving is about discovery and creativity. The sooner we can flip the switch from being told something to figuring it out for ourselves -- discovering for ourselves -- the sooner we begin to really enjoy science and engineering.

Don’t get me wrong, knowing is important but equally important, after graduation and joining the workforce, is gaining confidence with handling things. The nice thing is that we don’t have to give up our quest for knowledge -- if we make the leap to discovery, we begin to experience discovering for ourselves. 

For the engineers reading this post: What hindered or helped your problem-solving skills when you entered the workforce?    


Social Responsibility and Shared Value = Higher Profits

This past month, John C. Camillus, Bopaya Bidanda, and N. Chandra Mohan published a book titled The Business of Humanity: Strategic Management in the Era of Globalization, Innovation, and Shared Value, which explains why many organizations are pursuing a novel, forward-thinking business model. These companies are building "humanity" into their models as the driver of economic, environmental, and social sustainability.

During a recent email conversation with the authors this month, I asked them: “Can companies built on shared value sustain for the long term?” Here is their collective response:

That is a fundamental question that goes to the heart of the Business of Humanity® Proposition. Our answer is an emphatic "Yes!"

Iconic figures such as Nobel Peace Prize-winner Muhammad Yunus contribute to keeping this question alive by proposing “social business” as a model, de-emphasizing profits and focusing primarily on addressing social concerns. This mindset, though most commendable, raises justifiable questions about sustainability.

We see shared value as a requirement for the survival of business. For instance, the importance of sharing value with communities is becoming apparent and activist non-governmental organizations (NGOs) make it an imperative. Remember that Tata Motors had to abandon a $300 million investment in an assembly plant because the local community felt that it had been exploited when land was acquired for the plant.

We go even further by arguing that sharing value strategically with the organization’s stakeholders enhances profitability. The disruptive innovations that are part of the Business of Humanity’s profit-enhancing business model will create damaging conflicts between stakeholders if they are not purposefully engaged in the process of value creation and understand that they will be earning a slice of a substantially larger pie.

We are definitely not being Pollyannaish. When Paul Polman, the chairman of Unilever, was asked how his company could continue to make profits with its emphasis on social and environmental sustainability, his response was that he did not see how profits could be sustained without such an emphasis. The Business of Humanity strategy development process is designed to ensure that shared value promotes profitability and, consequently, sustainability.

Do you think there is validity to the argument that a more human-centered capitalism is vital as a long-term business strategy and the correct method for sustainable economic behavior?  


Lean Initiatives in the Construction Industry -- Can they succeed?

Just this month, Gary Santorella published a new edition of his forward-thinking book, Lean Culture for the Construction Industry: Building Responsible and Committed Project Teams. Much has changed in the construction industry since Gary published the first edition of his book back in 2010, so I contacted him to discuss what he has observed and learned working with professionals in this industry during the past seven years. One of the questions I asked was:“What are the main obstacles to a Lean initiative in a construction environment?” Here is his very candid and insightful answer:

The main obstacle is not an intellectual one, but psychological. In an industry that relies heavily on a multitude of personalities and companies, all of whom have competing interests, there is a natural tendency to resist tools that were developed in a controlled manufacturing environment. When you allow people to talk freely, there is a sense of skepticism that Lean practitioners “just don’t get us or what we do.” And, in many ways, they are right. Many of those trying to implement Lean in the construction industry are a bit tone deaf. They hear resistance as an intellectual challenge, and therefore counter it by generating copious amounts of data, imposing weighty (and sometimes faulty) measurements, and implementing Lean tools in such a way that is cumbersome – all of which only serves to justify the divide.

Given that most Lean practitioners are engineers by training, I understand the inclination to go straight for the analytics rather than attend to interpersonal struggles and issues influencing workplace culture, but in doing so, they ignore the realities of our industry. On any given day, the average Project Manager interacts with scores of individuals, each of whom comes from a variety of different backgrounds. From owners, architects, and city planners, to inspectors, workers and various employees and departments within their own company,  managers in construction, more than any other industry, have to be able to navigate the murky waters of human dynamics and interpersonal politics. That’s not to say that there aren’t ample opportunities for measurement and Lean tool implementation. Pull-planning, Value Stream Mapping, 5S and Kanbans have literally transformed businesses that were bleeding money in the form of waste. We know the flow stoppages that are the result of people choosing to store information idiosyncratically on their personal hard drives rather than using the standard practice of uploading to a common share drive. But when we emphasize data, and measurement, and tools we are taking Lean out of its proper context and missing the most transformative element of Lean – it’s ability to transform a culture.

The construction industry is, unfortunately, fraught with blame, finger-pointing, and self-protective cover-your-butt behaviors. The average Owner-Architect-Contractor meeting is more of an exercise of the fine art of attack and counter attack than productive waste identification and problem solving. Teaching people to use Lean tools in the context of their interactional realities is far more productive than measuring everything. When all of the competing parties understand that there is far more to be gained – financially and psychologically - by viewing problems as opportunities to improve, rather than as weapons, that’s when people start to understand the true power of Lean.

As Lean practitioners, we need be as interested in helping people to embrace the concerns of all of the parties, as we are in implementing the tools. To me, this is the true power of Lean. I love the framework because if implemented properly, it melds process and measurement with the psychological realities of human interest, and embodies the true meaning of the word teamwork by empowering people to change their working environment for the better. It’s exciting and humbling to see people come to the realization that they are far better off as a united whole, than a bunch of separate competing interests who are resigned to doing battle with each other. To me, this is the true power of Lean. The tools should be a means to get there, rather than the end result. 

What do you think of Gary's comments? For those working in the construction industry, do you agree with his observation of behaviors and habits?


Employee Engagement is More than Just Rewards

At the beginning of May, Kelly Graves published a compelling new book titled The Management and Employee Development Review: Competitive Advantage through Transformative Teamwork and Evolved Mindsets, which helps managers build a motivated an engaged workforce. I spoke to Kelly this past week, and I asked him: What are the common mistakes managers make when trying to motivate employees? What can managers do to successfully engage and motivate employees? Here is his detailed answer:

It is human nature for managers to take the path of least resistance, and this choice often leads to only temporarily solving symptoms -- not the core problems. When motivating employees, however, it is wise to look to behavior modification techniques to guide you. First, let’s look at what most managers attempt to do to motivate employees -- Often, they want to prove they have all the answers or simply short-cut the process due to time constraints, so they follow what they have seen or read what other managers have done to motivate employees. 

Many managers rely on what they think employees want using short-term rewards -- such as money, pizza parties, gift cards, or a fun-oriented team-building event with no long-term follow-through, which can often cause more harm than productivity if not handled by someone educated in cultural dynamics. These are all fun ideas and may provide short-term excitement but they will not create lasting motivation. In fact, employees may not want some of these because they involve spending more time away from their families and more time with people at work, with whom they feel they already spend too much time. In addition, one-time financial rewards doesn’t directly equate to long-term motivation.

As a manager, it is imperative above all else to provide that “why” to your team -- why are they here and why they should embrace the company goals.In other words, you must give them something to believe in that is bigger than themselves.  Provide them with a clear destination, and make sure they understand that this goal is paramount for the success of the organization, the department but more importantly, how it directly impacts their lives. The central objective of a great manager and motivator of people is to touch your employees at their core so they see and believe in your vision as fervently as you. To achieve this higher state, one must climb inside the mind of their employees and tap into their intrinsic motivation.

Intrinsic motivation is the desire to seek out new challenges, to analyze one's capacity, and to observe and to gain knowledge. It is driven by an interest or enjoyment in the task itself, and exists within the individual rather than relying on external pressures or a desire for reward. Intrinsic motivation is a natural motivational tendency and is a critical element in cognitive, social, and physical development. Employees who are intrinsically motivated are more likely to engage in the task willingly as well as work to improve their skills, which will increase their capabilities. Employees are likely to be intrinsically motivated if they:

•    Attribute their results to factors under their control, also known as autonomy.

•    Believe they have the skills to be effective agents in reaching their desired goals, also known as self-efficacy beliefs.

•    Are interested in mastering a skill, not just in achieving it for some outside force.

Try these 10 steps to motivate your employees: 
  1. Provide a healthy environment: As the manager, it is your responsibility to provide the environment that enables members of your team to feel challenged and engaged by the work they perform.  
  2.  Create a trusting environment: Trust is a powerful motivational element and managers that are more transparent with their employees will create employees who return that trust. Once trust is part of the culture, innovation, creativity and performance follow. 
  3. Involve them: Asking what  would make their jobs easier, more productive and more fulfilling. In essence, people want to feel valued and acknowledged for their expertise.
  4. Encourage responsible risk taking: Encourage your employees to exceed expectations by taking responsible risks. If they succeed, reinforce the effort and the ability to take responsible risk. If they fail, ask what parts went well and what parts didn’t. Help them to learn and utilize critical thinking skills so they can learn how to learn to take responsible risk. 
  5. Anticipate failure and normalize it: Coach your employees that responsible risk taking comes with a certain amount of experimentation or adjustment also known as short-term failure. This type of thinking must be coached or all you will have on your team are drones following your lead or “doing it the way we have always done it” due to fear to step out of their comfort zones, which will result in continuous mediocrity. 
  6.  Challenging Work: People simply want to improve at their jobs. Overcoming a challenge or finding a creative solution to a problem is a characteristic that strongly motivates employees. 
  7. Career Advancement: One of the most forgotten yet powerful motivators are helping employees outline their careers. Employees are extremely motivated when they know what the next rung on the ladder looks like and what they need to do to achieve it. 
  8.  A clearly defined goal. First the manager needs to outline what the department goals are. Next, spelling out specific tasks and behaviors which support the department goals help employees understand how they contribute to the greater organizational objectives. This helps the employee understand the organizational objectives, how the departments goals directly support’s the organizational objectives and how their specific tasks and behaviors directly support the department goals. This concept transcends work for the sake of work and teaches them how they directly contribute to the success of the company. 
  9. Give regular, direct and supportive feedback: Both positive and performance enhancing feedback is vital to continuous improvement and when done well it provides the motivation to move employees continually on the path toward success. Feedback needs to be timely, specific and presented in such a way that the employee is clear about what behaviors they need to modify or continue using in order to improve performance.  
  10. Recognition and increased status when the goal is achieved: People not only want to be recognized for doing a good job, their emotional well-being depends on it. Similar to involving them in the process is recognizing them in front of others, which increases their status among peers. This simple tip will jump start a poor performer or catapult an already strong performer to superstardom.
What do think of Kelly's advice? As a manager, what do you think works best regarding work culture and employee engagement?


How Do You Engage, Involve, and Motivate Employees?

Any Lean or performance-improvement initiative cannot survive on tools alone. Leaders must cultivate learning environments and develop the shared values that serve as the foundation for  dynamic culture. This month, Janis Allen and Mike McCarthy published an interesting book called How to Engage, Involve, and Motivate Employees: Building a Culture of Lean Leadership and Two-Way Communication that shows just how important it is to motivate and excite employees to take ownership of their roles.

When I spoke with Mike recently, I asked him, "Why do current employee-engagement programs fall short?” Here is his complete answer:

When asked, “Do you have an employee engagement program?” many managers answer, “Sure! Look at these engagement survey scores.” Beware! Quite often, people tell us what we want to hear on engagement surveys. If you really want to know about engagement, gemba gembutsu (go to the shop floor and see for yourself). Ask questions. Ask operators what ideas they have for improving the work. Then: 1. listen, and 2. help them test their ideas. You are now engaging people in improving their own work.

“Engagement” is a noun. Nouns are names of objects. Engage is a verb. Verbs are action. So, instead of asking your company’s managers “Do you have engagement?” say “Let’s go walk the shop floor and engage with our operators by asking what improvements they are making.” It’s the difference between saying “I have a stapler,” (the name of the object sitting on the desk doing nothing) and saying “I’m stapling these papers” (stapling is a verb, action, and you are doing something).

Engaged = observable actions by employees working on improvements. So, when a visitor comes into your workplace and asks, “Are your employees engaged?” say, “Let’s go talk to them. Then you tell me.” Take that visitor to the work area and introduce him to an employee. Say, “Allie, would you show our visitor the changes the team made on the shop floor?” If your employees can do this, they are actively engaged. The purpose of engaging employees is to inspire them to make improvements they can be proud of.

Survey Scores Vs. Go Engage. My new automobile monitors oil level, tire pressure, and other indicators electronically. I get an email with a link once a month that shows me if the tire pressure etc. has been low during the past month. What’s wrong with this picture? After all, I “have” a tire pressure report. Here’s what’s wrong: If I’m about to go on a long trip, I need to know right now if the tire pressure is low. I need to go to the garage (gemba gembutsu) and measure the psi in my tires by pressing (action verb) my tire pressure gauge to each valve stem and see for myself. When your focus is on a measurement tool rather than the actions you want, you get off track. If you steadily gazed at the speedometer while driving, you’d run off the road!

“What do you want me to say, Boss?” Many employees don’t tell the truth on engagement surveys; they say what they think management expects them to say. And in case this so-called anonymous survey isn’t really anonymous, who wants to be the one who says, “I’m not engaged?” This is another reason survey data is not an accurate indicator of actual engagement.

At an airline departure gate, we heard the announcement, “Please complete our customer survey when you receive the email. We want you to rate us a five, not a four. Five is alive; four is out the door. Ha ha. Just to help you remember to rate us a five, we have this basket of snacks here on the counter for you. Help yourselves. It’s not a bribe or anything.”

We saw a half-dozen people help themselves to the snacks. We wonder how many completed the survey, and even if they all rated the airline “Five is alive,” if it was an accurate indicator of their customer experience, whether they would fly with that airline again, and what they tell their colleagues about that airline. Often, people say what they think someone wants to hear. Why not? The person giving the score has nothing to lose. So beware of surveys. People have all kinds of wrong motives for the ratings they give.

Leaders can show people how they can take actions to make improvements they can be proud of. You can help them to do it. The most important results for your organization are the real actions taken to make improvements. But a positive side-effect of those engagement actions is that answers on engagement surveys will also improve. The survey improvement will be based on employees’ actions, their good results, and the satisfying feeling of being on a team. With action-focused engagement, your survey results will be based on actions and their real experience, not just words! And your company will be growing and prospering. 

Does your company have an employee-engagement program? Does it commit many of the mistakes Mike McCarthy mentioned here?


Is the Hoshin Kanri Forest More Effective than the Traditional Hoshin Kanri?

Many companies involved in Lean initiatives know the effectiveness of Hoshin Kanri as a policy-deployment methodology. It ensures that an organization's clear strategic goals drive progress and action at every level within that company and it incentivizes proper behavior.

Earlier this year, Javier Villalba-Diez published a book that expands on the concept called The Hoshin Kanri Forest: Lean Strategic Organizational Design. In this book, Javier introduces a theory called the Hoshin Kanri Forest that considers organizations as networks with organizational structure, functional connectivity, and effective dynamic patterns for attaining an optimal strategic organizational design towards the strategic goal of Lean management. I had a chance recently to speak with Javier about his book, and I asked him “What makes the Hoshin Kanri Forest methodology different and more effective than traditional Hoshin Kanri?” Here is his answer:

The crucial finding (there are others) of Hoshin Kanri Forest, and what makes it more effective than traditional Hoshin Kanri methodologies, is that it embeds complexity within the organizational design configuration. For the first time in Lean history, Lean practitioners have a model that enables them to embrace complexity in the management system.

Traditional Hoshin Kanri approaches aim to create alignment throughout the organization by coordinating several organizational units. This is typically done by describing a Hoshin (long-term goal) and cascading or deploying this goal throughout the organization (usually through some sort of problem-solving empowerment methodology). The problems with this approach, which is very deterministic and regular, pops up when complexity arises and the matrix-like thinking is no longer able to cope with the complexity associated usually to product or environmental variability.

To picture an example, the average path length (the number of managers information needs to touch to get from one manager to another in average) of a matrix organization of N=800 managers equals 100. This means that in average, to transmit a message/management order from any given node to any other, we would need 100 steps. The Hoshin Kanri Forest introduces the standardization of business communication through (CPD)nA (which is a developed form of the traditional current-state / target-state based PDCA). By doing so, the Hoshin Kanri Forest is able to create forest-like organizational networks that present several important topological advantages as compared with traditional organizational design configurations.

In the previous example, the APL of a Hoshin Kanri Forest organization is typically APL=ln(ln(N) which for N=800 managers equals APL=1,9!!! This is a 50-fold increase in performance than the traditional design configuration! With the same organization, with the same people, the Hoshin Kanri Forest changes the organizational design to enable the organization to compute complexity. In addition, the Hoshin Kanri Forest shows why methodologies such as Kata do not provide the necessary tool set to compute organizational complexity. But to find out more detail about this and other advantages of Hoshin Kanri Forest, you will need to read the book! ;-) You can visit the book´s website for more information: www.hoshinkanriforest.com

Here is a video of Javier explaining the differences between traditional Hoshin Kanri and the Hoshin Kanri Forest:


What are Current Leader-Development Systems Lacking?

This month, David Veech published a very interesting new book called Leadersights: Creating Great Leaders Who Create Great Workplaces. This book addresses an important need: How organizations can create a leader-development system that defines, builds, and reinforces critical leader behaviors. When I had the chance to speak with David about his book, I asked him: What is the biggest problem with current leader-development systems and how can they be improved? He provided an insightful answer:

I'm not sure there are problems with leader-development systems that would threaten the livelihood of organizations, but as with everything else in our continuous-improvement community, there are always parts we can improve. I’ve centered and focused on a couple of areas, and I’ve tried to simplify things a bit as I try to communicate with people about becoming better leaders.

After years of studying the Toyota Production System and other companies that demonstrate consistent success, specifically those profiled in Jim Collins’ books Good to Great and Great by Choice, I have come to believe that the key features of any leader-development program must be built on a platform of servant leadership. I get a lot of agreement with this from people, but there are lots of pieces to becoming an effective servant leader.

The most significant of these pieces is the structure of the workplace. If we have an organization structure that is based on traditional, functional silos, and one that bases compensation of the accomplishment of self-set goals, that structure forces leaders into a particularly results-oriented focus, regardless of their personal leadership style preferences. The system affects their leadership behavior. When a leader assumes a new role, the subtle (or not-so-subtle) competitive pressures implied by the results-oriented system force that leader, out of self-preservation, to either undo what previous leaders have done, or make a change that has their fingerprints on it so they can stand out a bit from the crowd. In most organizations, leaders rotate through key positions moderately frequently (sometimes as little as 18 months between roles), and they get conditioned to this kind of activity even though personally they may be humble and very people-oriented. Lean helps because we try to change the work structures for better performance, and because we focus on the development of people as the primary outcome.

Changing the fundamental structure of the conventional organization is a large undertaking, so I have tried to outline something of a more subversive approach than blowing things up and rebuilding from the rubble. We’ll need to first identify what behaviors are truly important to us as a workplace. Empathy. Listening. Encouraging. Correcting. Coaching. These we describe and operationalize in our statement of corporate values, which with our vision and mission set out our operating philosophy. Then we tie these to performance appraisals and bonus compensation. These are hard to measure, so this is a leap of faith for most workplaces. More importantly though, we must have systems and leaders who model and teach these behaviors, and as with other skills we want to develop, these need to be set out in the leaders’ standardized work. I think this might be the biggest departure from what most of us talk about when we describe leaders’ standardized work. Where most of us use this tool as a checklist and reminder of the key things we must complete daily, weekly, and monthly, we don’t articulate how to be empathetic; how to listen; how to encourage. I think we can fix this be setting out standardized work for these types of skills and reinforcing these skills through frequent coaching as a task within Short-Interval Leadership. 

Ultimately, leaders only need to do three things: Decide to love, continue to learn, and let go of the control they think they have over the workplace. Those skills I mentioned are all components of these three decisions/actions/ habits. These allow us to integrate various leadership styles in our daily work, including the “go out and get noticed” piece that I call “connecting”. But I have to take this back to the structure conversation. Without key changes in the way we describe, hire, evaluate, and compensate leaders; and without key changes in how the work is structured in the workplace away from batch-and-queue, lots of handoffs, and transaction-driven and toward flow, it will be very difficult to build these types of leaders for the future.  

What type of leadership-development system exists in your organization?  What are the major factors affecting your leaders' behaviors?