Are Lean thinking and social business compatible?

Are Lean thinking and social business compatible

Are Lean thinking and social business compatibleThe short answer is, it depends. There are many ways to interpret Lean, just as there are many ways to interpret social business, and some of the tools used under these names are not compatible with each other. However, the thing I am most interested in is their compatibility on a very fundamental level, on the level of their core premises from which the various tools are but imperfect manifestations.

Just like value-stream mapping is not the same thing as Lean, crowdsourcing is not the same thing as social business. While a toolkit approach to Lean or social business may produce results, it is usually very difficult to retain those results unless the toolkit is based on something more and ingrained into the corporate culture. In order to explore the compatibility of the paradigms, it is necessary to explore their core.

Lean thinking

Lean is a popular buzzword nowadays, and it has stretched far from its roots in manufacturing into fields such as healthcare (open access) and car repairs. There are many definitions of Lean, but the various definitions share common elements from which a coherent picture can be drawn.

Toyota values

Lean originated at Toyota mostly from the 1950s on, after Eiji Toyoda visited Ford and came to the conclusion that their mass production model could not work at Toyota, which was manufacturing a tiny fraction of the numbers the big US companies churned out. Toyota’s response was the development of the Toyota Production System, TPS, that would eventually make them the largest car manufacturer in the world.

Nowadays, Toyota defines the Toyota Way as two groups of values: respect for people that consists of respect and teamwork and continuous improvement that consists of challenge, kaizen, and genchi gembutsu.

Challenge: We form long-term vision, meeting challenges with courage and creativity to realize our dreams.

Kaizen: We improve our business operations continuously, always driving innovation and evolution.

Genchi gembutsu: We practice genchi gembutsu.. go to the source to find the facts to make correct decisions, build consensus and achieve goals at our best speed.

Respect: We respect others, make every effort to understand each other, take responsibility and do our best to build mutual trust.

Teamwork: We stimulate personal and professional growth, share the opportunities of development and maximize individual and team performance.

In his book Gemba Walks, James P. Womack provides an insightful account of what respect for people means for managers at Toyota :

The manager begins by asking an employee he or she supervises what the problem is with the way work is currently being done. Next the manager challenges the employee’s answer and enters into dialogue about what the real problem is. (It’s rarely the problem showing on the surface.)

Then the manager asks what is causing this problem and enters into another dialogue about its root causes. (True dialogue requires the employee to gather evidence on the gemba [where the work takes place] for joint evaluation.)

Then the manager asks what should be done about the problem and asks the employee why he or she has proposed one countermeasure instead of another. (This generally require considering a range of countermeasures and collecting more evidence.)

Then the manager asks how they – manager and employee – will know if the countermeasure has achieved a positive result, and again engages in dialogue on the bext indicator.

Finally, after agreement is reached on the most appropriate measure of success, the employee sets out to implement the countermeasure.

Over time I’ve come to realize that engaging in this problem-solving process is actually the highest form of respect. The manager is saying to the employee that the manager can’t solve the problem alone, because the manager isn’t close enough to the problem to know the facts. The manager truly respects the employee’s knowledge and his or her dedication to finding the best answer. But the employee can’t solve the problem alone either, because he or she is often too close to the issue to see its context, and may refrain from asking tough questions about his or her own work. Only by showing mutual respect – each for the other and for each other’s role – is it possible to solve problems, make work more satisfying, and move organizational performance to an ever-higher level.

Lean is deeply humanistic and Confucian. To quote Wikipedia on Confucianism, its core is “the belief that human beings are teachable, improvable and perfectible through personal and communal endeavor especially including self-cultivation and self-creation.” Self-learning and self-improvement have a prominent place in Lean, to the point that it is fundamentally impossible for management to improve operations, they can only challenge and help the shop floor employees to improve them.

Lean Enterprise Institute’s definition of Lean

James P. Womack, one of the researchers who introduced Lean to the Western world, founded a nonprofit organization, Lean Enterprise Institute, in 1997 to promote Lean thinking around the world.

Their definition of Lean is as follows:

The core idea is to maximize customer value while minimizing waste. Simply, lean means creating more value for customers with fewer resources.

A lean organization understands customer value and focuses its key processes to continuously increase it. The ultimate goal is to provide perfect value to the customer through a perfect value creation process that has zero waste.

The definition of Lean used in this post

Based on the accounts above, the definition of Lean I use in this post consists of three core values:

Create value for the customer: Customer determines what is valuable. If the customer does not appreciate (and thus, by extension, be willing to pay for) some feature, that feature is irrelevant. A company should strive to create maximal value for its customers.

Eliminate waste: All activities that are not value-adding, are waste. Even parts of activities that are value-adding may be waste, if there is a better way to create the valuable outcome. A company should strive to eliminate waste in all of its activities.

Respect people: All human beings are improvable and perfectible through personal and communal endeavor. Continuous improvement towards perfection (which Toyota calls the True North) is a desirable goal in all things, even though full perfection can never be achieved. Therefore, all people, all employees, deserve the opportunity to improve themselves and their work and full support from the organization in doing so.

All three values are needed to distinguish Lean from other value systems. Respect for people alone is not enough to create a unique management philosophy. Yet, without respect for people, value creation and waste elimination could take significantly different forms than they do in Lean practice. Respect for people is the characteristic that fundamentally separates Lean from Taylorism.

Social business

There are many definitions of social business floating around, and most of them refer to the use of social media or social collaboration tools to achieve business benefits. Just like the various toolkit views of Lean, such definitions fail to grasp the most significant aspects of the new business philosophy, that it is really a culture change that is required without which the tools are of only limited use.

Nonetheless, there are at least two definitions of social business where the cultural aspects are properly recognized. These definitions have been brought forward by IBM and SideraWorks.

IBM’s definition of social business:

A social business is an organization whose culture and systems encourage networks of people to create business value. Social businesses connect individuals, so they can rapidly share information, knowledge and ideas by having conversations and publishing informal content. They analyze social content from multiple channels and sources, in addition to structured data, to gain insights from both external and internal stake-holders. When those things happen, innovation and business execution rates increase, better decisions are made, and customers and employees are more engaged and satisfied. Social businesses enjoy lower operating costs, faster speed-to-market, improved customer and employee engagement, and increased profitability. (Social Business: Patterns in achieving social business success by leading and pioneering organizations)

SideraWork’s definition of social business:

Social Business is the creation of an organization that is optimized to benefit its entire ecosystem (customers, employees, owners, partners) by embedding collaboration, information sharing, and active engagement into its operations and culture. The result is a more responsive, adaptable, effective, and ultimately more successful company. (What Is Social Business?)

Significantly, the above definitions make no reference to any particular tools to be utilized in achieving these goals. Thus, they are at the correct level, that of values, so that they can form the basis of a meaningful comparison with Lean.

The definition of social business used in this post

Based on the accounts above, the definition of social business I use in this post consists of three core values:

Empower employees and customers: Decision-making is widely distributed within an organization. Customer input is collected whenever possible and rapidly reacted to.

Promote networking and collaboration: Self-organized collaboration is encouraged. Direct contacts between departments and between employees and customers are encouraged.

Promote transparency and openness: All information is widely accessible, except when there are special reasons (e.g. legal reasons) to restrict access.

Operating a company beyond a mere few employees based on these values has become practicable only with the introduction of various social collaboration tools – just imagine attempting to achieve full transparency in a multinational company before personal computers or even with just email – but the values themselves are not dependent on such tools. It is nonetheless no coincidence that this value system has surfaced now, because even though the ideals have been bubbling under before, they are much more relevant now that the technology to truly utilize them exists.

The compatibility of Lean and social business

With the values out in the open, it is easy to see that Lean and social business are not in major conflict with each other. If anything, they complement each other in many ways!

The view of what it means to be human in Lean and the associated principle of respect for people provides a deeper justification to all social business values. Social business, on the other hand, opens a plethora of new opportunities for Lean, as it enables taking respect for people to lengths that have been unimaginable for much of Lean’s existence – just think how much technology has improved since the 1950s.

The most challenging part is combining Lean’s principle of waste elimination with the ideals of social business. It is by no means obvious how this combination will work out.

It is also worth noting that the toolkit of Lean and the toolkit of social business have hardly any overlap at all at the moment despite their striking compatibility on value level. This is easily explained by their independent evolution in completely different circles and decades apart, but it also means that their combination may have surprising potential.

We have an interesting journey ahead of us to discover what that potential is, exactly.

Photo: arr ee ess pee ee cee tee by Inha Leex Hale @ Flickr (CC) (From John Shook’s book Managing to Learn)

Author: Ville Kilkku

I run my own consultancy business, so if you find the ideas on this blog intriguing, contact me at consulting@kilkku.com or call me at +358 50 588 5043 and we can discuss how I can help you solve your business problems. I am currently based in Turku, Finland, but work globally. Google+