Developing a Lean Leadership Culture

1. What is Lean Leadership in the context of building a World-Class
Lean Culture
Mark Forkun Gnosis Business Solutions. www.gnosis.com.pl 2014 Page 1
Developing Lean Leaders
Mark Forkun, 25 years of experience building and restructuring both independent firms and corporations, lean leadership writer and conference speaker, explains what lean leadership is and why it is needed, talking about Toyota’s approach to forming leaders.
Why lean leadership? These days organisations around the world have at least dabbled in the tools of lean and achieved enough positive results to keep going. Yet, so many are disappointed that the new, beautiful processes, so well documented in value stream maps, do not perform as envisioned. People lack the discipline to follow the new procedures, sustain the newly embossed standardised work, call for help using the andon system, and solve problems as they occur.
When the concept lean, becomes the goal, we missed the point. Lean is a journey winning the hearts and minds of each and every employee, so that we achieve three things; a motivated team, with self-reliant employees, each looking to improve what they did yesterday, each day all day.
Using a lean approach, let us ask why this is.
Why? Because they lack the discipline and focus. Why? Because they do not see what is in it for them to do this new, extra work. Why? Because they do not really understand where these specific changes are headed and what they can do for them and the company. Why? Because they have not learned deeply enough to believe in lean. Why? Because nobody they respect and trust has been teaching and coaching (sensei) as they have gone through the change. Conclusion: leadership is weak, uncommitted to lean, and lacks skill and deep understanding. A systematic but nevertheless, a dramatic change must take place to support and sustain lean transformation that starts with a diligent and disciplined focus on self-development. (see Kolb, PDCA, PDLP)
Ask enough whys, sometimes more than five are necessary, and more often than not you will find your way to inadequate leadership. By definition, leaders lead. That means they have people who willingly follow them. Virtually every modern book on leadership concludes leaders must paint a picture of the future state and purpose of today’s activities. Leaders must passionately believe in the purpose and process. Leaders must inspire others. And in lean we know that leaders must show the way through the methods to make forward progress. Those methods – stable processes, visual management, standardised work, problem solving, clear pictures of the target versus actual – are powerful tools if used properly by leaders.
Definition of lean leadership.
Why is it any different from any other type of leadership? One could certainly argue it is not different from the theoretical ideal of a leader, but it is also radically different from what passes for leadership in so many organisations around the world. We know the lean leader must possess the general characteristics and skills that we expect of effective leaders – painting a vision, getting to know what drives the people they lead, active listening, empathetic questioning, the ability to help people find a way to satisfy their needs, and you can add to the list. So what are the peculiar “lean things”?

2. What is Lean Leadership in the context of building a World-Class
Lean Culture
Mark Forkun Gnosis Business Solutions. www.gnosis.com.pl 2014 Page 2
The real essence of lean according to Toyota is embodied in two seemingly simple, but powerful concepts – respect for people and continuous improvement. Respect for people in Toyota means viewing them as long-term partners in the business that appreciate in value over time and then mining that value by challenging people to stretch themselves and grow. People who are unchallenged and stagnant, even if treated nicely, are disrespected in the Toyota view. The way people can grow their capabilities is through participating in continuous improvement. Continuous improvement literally means making things better every day, sometimes taking big steps and more often taking small steps.
Continuous improvement sounds like a great idea – always getting better – but there are clear skill sets needed and a variety of supporting tools. That is where lean comes in. Let’s consider some of the characteristics of lean leaders and what they do that is quite a bit different from typical leaders these days.
WHAT DO LEAN LEADERS DO AND WHAT DO THEY NEED TO KNOW?
The starting point for a lean leader is managing from the gemba. This has become almost a truism, but few know what it really means. Obviously it means the leader has to be where the thing of importance is happening. That could be where the customers are (e.g., using the product, waiting in a supermarket), where the finances are being done, where the product is being built, where the product is being tested, where components are stored in inventory, and more.
There is a growing popularity of standardised work for leaders. Basically this consists of an organised pattern of walking and observing the gemba, perhaps with a different focus area every day. This satisfies the first requirement of going to the gemba, but it can also be just “showing up.”
As Taiichi Ohno said:
“If you are out there at the gemba, do something for them (the workers). If you do the workers will think, ‘He’s watching us, but he comes up with some good ideas.’ That way when the workers see you they will look forward to your help again, and as a result they will begin telling you what makes the work hard to do and ask you to think of ways to make it better.”
Figure 1: The Lean Leadership Model

3. What is Lean Leadership in the context of building a World-Class
Lean Culture
Mark Forkun Gnosis Business Solutions. www.gnosis.com.pl 2014 Page 3
Learning how to add value at the gemba is a totally different skill set to learning to walk a set pattern. It may be standardised walking and looking, but not standardised value adding. To add value requires skills that include many abilities:
To understand the process and see waste;
To ask the right questions and understand the problems;
To generate some ideas, but more importantly to draw out the ideas of those at the gemba;
To be a role model for good problem solving;
To have the skills in problems solving to be a role model and coach (sensei)
DEVELOPING LEAN LEADERS
It is not easy to develop lean leaders, but it is not unnaturally hard. The truth is that it is hard to learn any new skills, particularly for adults. Try to teach someone who has little experience to play a musical instrument, or to develop skills in tennis, or to learn to cook cakes, or many other new skills. Lean leadership requires a complex skill set that unfortunately few managers have developed.
At Toyota there is tremendous respect for “on-the-job development” (OJD) guided by a sensei (master trainer). Perhaps it is related to the long tradition within the company, and within Japan, of the master-apprentice relationship. We know how to teach. We can tell the difference between a good tennis teacher and a poor one. We would never let our children go to a short course to learn a new sport and expect them to come back in a week as experts. We know it takes dedication, practice, feedback from a good teacher, and years of intensive study. Why do we think we can develop a leader in an offsite or at a university short-course on leadership? It cannot be done. It has to happen at the place of work, at the gemba, with deliberate practice, with a coach, spread over years.
Figure 2: The Personal Development Plan - PDP

4. What is Lean Leadership in the context of building a World-Class
Lean Culture
Mark Forkun Gnosis Business Solutions. www.gnosis.com.pl 2014 Page 4
Toyota does this. At Toyota, and in countless other firms, I would go to the gemba, observe the process, talk to the people, show them that I was genuinely interested in what they were doing, ask for their views and advice. If they needed something from me, I made 100% sure, that if I did not have the answer, or we agreed on something, I would get back to them. No matter if this was a Director responsible for procurement or production, or a manual operator. I always made sure they knew I would respond to whatever we agreed. I estimate it would take at least three years years of OJD before I could really trust someone to be a gemba leader. The process is simple. You are thrown into a challenging situation and as you work your way through it the coach (sensei) shows up to check on your progress and provide advice, ask questions, and make sure you are not in over your head. But you must have the drive to solve the problems and to win the trust of the people. Through repeated practice doing this the leader will advance. Those who learn the most and demonstrate it at the place of work, the gemba, get promoted to higher levels of challenge.
On-the-Job Development (OJD) – The most developed form of training is OJD. Leaders being taught to be coaches select one person they will develop. After two days of training on the basics of OJD, they work with that person to select a project that person will work on, then coach that person through the process, while that person is leading a team to solve the problem.
Primarily we are talking about being a coach and mentor (sensei). They all started top down and the senior leaders became trainers with the help of a small number of coaches. Senior leaders were repeatedly learning as they coached group after group of subordinates and evaluated their problem solving process. This is noticeably different from the usual corporate training programme, and consistent with the fundamentals of teaching a complex skill.
YOUR PERSONAL DEVELOPMENT PLAN (PDP). YOUR SELF DEVELOPMENT JOURNEY
I do not know of any other company that has been willing to make such a serious long-term commitment as I have experienced at Toyota to developing leaders. I view the Toyota story as a kind of True North. Think of a compass. You continually check, are we heading in the right direction?. Do we need to make a correction!. How is my team doing. Remember, the goal of True North is necessary to reach, but what is important is the journey. The “How’, of getting there. That is why management by objectives is not an option. We need to set True North, but with lean leadership it’s about How you get there. A lean leader has in one hand the hard skills of lean, such as problem solving skills, looking at the eight wastes, the constant need for 5S, the idea of pull not push. But in the other hand our lean leader holds what is most important. The soft skills of how to engage each employee all day every day. The skill and values of respect for people, building trust through sincerity and honesty and caring for the members, something which is called Mendomi. Care for others. Directionally this is what you want to do. How close can you get?
I recall a five day work shop I held in Belgium some time ago for a multi-national corporation that brought together 26 leaders from around the world to discuss and agree on how to move from a six sigma culture to a Toyota Way mind set. We made amazing progress during those five intensive days. It was an eye opener for me how CEO’s from China to India to South America to Europe, all agreed and committed themselves to a vision, mission and a set of values around the Toyota Way.

5. What is Lean Leadership in the context of building a World-Class
Lean Culture
Mark Forkun Gnosis Business Solutions. www.gnosis.com.pl 2014 Page 5
Fundamentally, they all knew that each person, whether Chinese, Russian, European, Indian or American, people need goals, but they also work better in an environment that cares and nurtures them, each day, all day. At the end of the five days the CEO of the group asked me a really tough question. He said he was fully committed to the new direction his company had taken. It was the right True North direction. A values driven World-Class company based on lean leaders. But he had a problem. He was about to make a very difficult decision which involved closing a production plant that had existed for over 150 years and employed some 30 percent of the local town. How, was he to equate what we had learnt, discovered and agreed to here, in Belgium, when in a few weeks he would need to make 20,000 employees redundant!. That was a tough question. This was my answer.
If the business has thoroughly analysed the situation and the business decision is to close a business unit then that is the right decision and one he must make. But more importantly, is not the goal, what is necessary, closing the business unit. But the HOW. How you close it is based on your lean leadership skills and values. In business we have many choices, some are tough ones. But we always, each day all day practice them. The road map to how we close is based on those values and principles we agreed too. So putting lean leadership into practice, we still close the factory, but the how we do it is fundamental to showing our true metal. This is where management by objectives completely does not work. It looks at the goal, is short term thinking and is often rewarded with some form of promotion or financial reward. So, let’s think how do we communicate to the employees our decision. Its better they know as soon as possible. Prepare them. Let them know what is happening. Then find opportunities for preparing them for looking for another job. Reskilling, interview practice techniques, cv writing, helping with relocation. Working with the local government agencies to assist in the process and so on. Yes, we set KPI’s, for closing a factory. For example, exit interviews on how the employees felt during the process. Was the company open, fair, honest. Did it support during the process. Did they help me in the ‘out process’. How many ex- employees found new work within three months of leaving. All this reflects our lean leadership skills. After all, closing a factory in a ‘Problem’ which needs to be solved, just as we have a problem in fixing a machine or a sales channel which is under performing. Each problem requires us to use those skills, tools, principles and above all values that are embedded in lean leadership.
In the meantime, at the end of the day, we are all responsible for our own development. We, the company, can provide training, but it’s up to us to self-develop. Self- development should follow the model we all know works for training. We must identify a goal for our future state. We must break this down into smaller chunks that we will practice. We should find a coach or seek out feedback 360 degrees around us.
Most importantly, we must become learners. The PDCA process applies as well to self-development as it does to solving a problem: we must have some sort of plan, do it, check what happened, and make adjustments based on what happened. Every activity, every interaction, is an opportunity for self-reflection and learning. Often companies who have some form of development programme for employees and yearly assessment completely miss the point. Assessment with your pier should be once a month as a more formal exercise, discussion your PDP, giving time for discussion on self- reflection and learning from our successes and failures. Our pier or sensei is there to listen and ask the right questions, give advice and support. This is also about caring for the development of our member. Often failures, for example the inability to win over a subordinate, are more instructive

6. What is Lean Leadership in the context of building a World-Class
Lean Culture
Mark Forkun Gnosis Business Solutions. www.gnosis.com.pl 2014 Page 6
than successes. Working to control what we can control – ourselves – is a lifetime journey. Becoming better people will always pay off, regardless of the particular organisation we are part of, to better our lives, those we love, and ultimately our communities and society.
Should you be interested to learn more regarding lean leadership and building a World-Class Lean thinking and behaving organisation, whether, you are a private firm or a corporation. I welcome your enquiry. My contact details can be found at the footer of this article.
Mark Forkun BSc. ACCA, MBA, ILM.