Implementing Lean or World Class Manufacturing – Don’t Underestimate the Effort

July 4, 2017

In the good old days, one of the toughest projects one could tackle would be running an ERP implementation project implementation.  We learned quickly that successfully implementing a MRP or ERP system was fraught with danger and uncertainty.  We also learned that the true effort and the complexity of the task was usually grievously under-estimated.  Though the effort it takes to be successful in an ERP system implementation is fairly well documented and understood, implementing Lean and World Class Manufacturing is less so.

Implementing Lean Manufacturing and Six Sigma brings up many questions about how to successfully go about it.  Recently I was asked, “Why is it such a big deal implementing Lean Manufacturing?  After all, the book I just read suggests I only need to worry about managing the value stream . . . Why is it so hard to do?”

To help those who have a strong background as a traditional APICS member using ERP systems, we can draw some analogies that are common between both types of implementations.  In the table below, we will examine some of these.

Implementation Issue: ERP Implementations: Lean/World Class Implementations:
Importance of having experienced “been there, done that” consultants and/or insiders with excellent Project Management Skills running the process. Critical.  There are a huge number of critical path activities that must be connected and well coordinated.  Hitting key milestones is the key throughout the process. Ultra-critical.  ERP is arguably 80% technology and 20% people, while Lean/World Class is the opposite.  Negotiating the painful and emotional changes of a full-blown Lean implementation effort is another magnitude of difficulty because you are affecting almost everyone – not just system users.
Importance of training – both “off the shelf,” and customized, based on the realities of your implementation. Critical.  If effective training in concepts, navigation and how your instance needs to operate is not achieved for a majority of the users, failure to achieve the benefits in the short term is certain.  Your implementation may even be considered a failure for this reason alone. Critical.  Remember, Lean/World Class is 80% to 90% people and 10% to 20% technology and tools.  Blow the training, reinforcement and customization part, and you can kiss any potential benefits goodbye.  Unlike the ERP project where you can get it done by brute force by a small group of Subject Matter Experts, you really only get one chance with Lean/World Class implementations.  If you fail, there will be such a bad taste in everyone’s mouth that you will never get another chance – maybe your replacements will, someday.
Importance in recognizing that implementation success is largely dependant on successfully managing changes in the organization’s structure and ways of doing business. Very important.  If the user community and leadership does not embrace the unavoidable changes to the structure and operations of the entity, passive and aggressive resistance to change can derail the process.  Top management buy-in and commitment for the one to three years of the process is required.  If your team is strong enough, top management does not necessarily have to be the primary sponsor and cheerleader to be successful (though it helps). Ultra-critical.  For traditionally run firms the structural changes represented by implementing Lean/World Class Manufacturing guarantees massive passive and aggressive resistance.  Look at the big three automakers’ struggles for the last 15 years, and you will find that management legacies of the 70’s are alive and well despite the loud and public proclamations of “getting Lean.”  Successful implementers of Lean/World Class typically succeed because top management is the principle cheerleader and champion.  Delegating leadership in a Lean/World Class implementation is NEVER successful, no matter how strong the implementation team may be.
Patience required before measurable results are evident. Lots and lots of patience is required – as the benefits of implementation do not occur until business processes are operating with the new system and the old has been turned off. Minimal patience required.  Why?  Companies just starting out, routinely find a lot of “low hanging fruit” in the form of dramatically reduced waste in parts of the enterprise.  I have routinely been able to get a 25%, 40%, or even a 60% productivity improvement in an operating unit in only a few weeks.
Patience required to achieve full implementation and reap the full benefits of implementation. Not much, as when you finish the (properly completed) implementation of your ERP system the benefits will begin to pile up.  Success tends to breed success, and as long as the old system is dead (no going back!), people will adapt to the new reality readily.  Think of it this way: you have replaced the old with the new; people are really doing what they have always done, just with new tools, bells, and whistles. Saintly patience.  The structural change of implementing Lean/World Class is painful at best, and usually excruciating for just about everyone – and in particular the middle management community, who will find their roles completely transformed.  In case you did not know it, this group also is the biggest source of “passive” resistance.  Fail to thoroughly educate, train, promote and or remove them at your peril.  Moving from centralized “control by the few,” to team-based “control by the many” is not automatic, nor is it intuitive.  If you think people will all naturally “get it,” you probably still secretly believe professional wrestling is “for real” (no offense to fans, professional wrestling can be entertaining . . . ).

 

 

Ron Crabtree

Ron Crabtree, President of MetaOps, Inc., is an organizational transformation coach/trainer, operational excellence (OpEx) adjunct facilitator at Villanova University, Lean and Six Sigma (LSS) speaker, author and thought leader in business process improvement/re-engineering (BPI/BPR). He is a consultant to private industry and government agencies in supply chain management, design of experiments (DOE), statistical process control (SPC), advanced quality systems (AQS), program evaluation review technique (PERT), enterprise resource planning (ERP), demand flow, theory of constraints, organizational change management, and value stream/process mapping and management. Ron has a BA in Management and Organizational Development, is a Master LSS Black Belt, and is Certified in Production and Inventory Management (CPIM), Integrated Resource Management (CIRM), and Supply Chain Professional (CSCP) by American Production and Inventory Control Society (APICS). If you are an executive and would like to chat with Ron about anything related to business process improvement and operational excellence, please get on his calendar here: http://bit.ly/ExecutiveChat

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