The LEI senior executive series on …

Lean Leadership
A co-author with Jeffrey Liker of the Shingo Research Award-winning book Toyota Culture,
Michael Hoseus developed his lean skills at Toyota Motor
Manufacturing, KY, where he worked at the general manager
level in both Production and Human Resources. LEI recently
talked to him about how the role of a leader changes in creating a
lean culture.

Q. Most managers and executives would support the idea of

supporting continuous improvement and creating a problem
solving culture. So why are these ideas so hard to
operationalize?

A. Establishing CI and problem solving as a culture is a

challenge for most companies because they are missing key
concepts such as establishing a clear purpose and then roles and
responsibilities for everyone in their organization, including leadership and human resources to
connect to that purpose. This means, often times changing the roles of the managers and
executives as well as entire departments and it’s not easy without committed and knowledgeable
leaders.

Q. What are the most common mistakes that you see companies make when trying to
implement lean?

A. The most common mistakes in implementing lean is thinking that lean is a set of tools to be
delegated to some lean champions to implement while the leaders go about running the business
as usual. A lean transformation means that lean must be connected to the business need of the
organization and change the way the organization does business. Most organizations are still
operating in their functional “silos” and lean requires them to be operating “horizontally” across
the “supply chain to customer” value stream.

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Q. You’ve said that most organizations focus on the product value stream and ignore the
“people” value stream. What’s the people value stream?

A. Most companies involved in lean have now done value-stream mapping, which “maps” the
process of adding value the product or service they provide from start to finish, “across” their
organization. This includes identifying gaps to the standard, adding value, and pinpointing where
waste occurs. The people value stream challenges the organization to look at their people the
same way. It’s a great tool. Is there a standard for what type of people we hire or promote into
our organizations, is there a standard process to how they are hired, orientated, trained, engaged
in standardized work and problem solving? Finally, is there a standard process for evaluating,
compensating, and communicating? After these standards are set, then the organization can begin
the PDCA [plan-do-check-act] process of identifying gaps and making improvements.

Q. Can you give readers some practical advice about what they and their teams may have
to change about their current roles and behaviors in order to lead a lean transformation?

A. The role of leaders does change in a lean organization. In the traditional organization, leaders
are successful and rewarded for getting results, directing, and delegating to people and often “fire
fighting” with quick solutions to problems. In a lean organization, the focus shifts from the
results to the process needed to get the results and from directing people to coaching and
facilitating. This coaching and facilitating is toward building both personal and organizational
capability around PDCA and problem solving.

Q. Can you give us a taste of what problems your Transformation Summit learning session,
“The Role of Leadership in Creating a Sustainable Lean Culture,” will help managers
solve?

A. An inspired and engaged leadership team is vital to a successful lean implementation. This
workshop will focus on how leaders can address the “Top Ten” barriers that organizations face
in their lean transformations. An example of one of these barriers is using lean as first and
foremost and way to cut costs. This strategy can backfire and actually sub-optimize your lean
efforts. Here’s the complete list of barriers that we’ll tackle:

1. Using lean in order to cut costs

2. Leaders “delegating lean” to others
3. Not identifying the proper roles for “everyone” in the organization
4. Too much focus on “lean tools”
5. Not involving HR properly
6. Processes and improvements not connected
7. Using the wrong measures for success
8. Not being proactive in preparing for a financial crisis
9. Not linking lean to the “daily work”
10. Not objectively assessing their current progress

More interviews from LEI’s executive series on Lean Leadership

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  Dan Ariens, CEO of Ariens Co.
 Jack Billi, M.D., associate dean and associate vice president for medical affairs
University of Michigan Medical School
 C.J. Buck, CEO of Buck Knives
 Hank McHale, manufacturing CEO
 Chris Vogel, senior vice president, Wells Fargo Home and Consumer Finance
 Karl Wadensten, president, VIBCO
 John Wilson, executive vice president of manufacturing, New Balance Athletic Shoe, Inc.
 Joel Zeller, director of logistics for Polaris Industries and Robert Martichenko, LEI
faculty member

For More Information

 Workshop: Sustainable Lean Culture: Connecting the “Product” and the “People” Value
Streams
 Toyota Culture: The Heart and Soul of the Toyota Way
 “The Role of Leadership in Creating a Sustainable Lean Culture” (Learning Session at
the 2011 Lean Transformation Summit link)

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