1D – Da gestão moderna à gestão lean

Thinking About Management:Traditional, Modern, Lean

Jim Womack, Founder & Senior Advisor, LEI
 What’s Lean?
• Creating more & better value for the customer using less of
everything:
 Time (concept to launch, order to delivery)
 Inventories
 Human effort (at all levels)
 Space
 Defects, rework, and scrap
 Capital expenditure
 Injuries
 Waste of human potential & improvement ideas
 First Critical Point for Managers
• All value is the end result of some process.
• All value streams (processes) consist of a series of actions by
people and equipment.
• Some of these actions create value: “Work”.
• Some are currently necessary to do the value-creating work:
“Incidental work”.
• Some are waste; to be eliminated: “Muda.”
Second Critical Point for Managers

• Management is incidental work that enables

the value-creating work.

• So, as managers, start with the work and

work backwards (upwards) to ask how you
can enable and optimize the work.
 The Advance of Lean Thinking

• Born in the auto industry, Henry Ford, 1914

• Turned into a complete business system by Toyota, by 1973
• Adopted across the world > 1980
• Starting in autos & general manufacturing
• Then in services – financial, logistics & transport, distribution, retail,
healthcare
• Recently in government & non-profits
• Now in start-ups & in every country!
 Lean Implementation
• Initially with tools, by means of point kaizen, initiated by heroic leaders:

 Andon, poka yoke, cells, kanban.

• Later by Material & Information Flow Analysis with Value Stream

Mapping.

• Usually led by external consultants and internal improvement teams

(staffs).

• Disconnected from line management.

 The Consequence
• A lot more improving by introducing lean tools (an input)
than improvement in performance (the only relevant
output to the consumer.)

• How can we all do better?

 Where We Are Today?
• We have achieved what we can expect to achieve by
consultants and improvement staffs applying tools, at the
command of “heroic” leadership.

• To do better we need to think hard about the practice of

lean management and the role of lean leadership.
 What Do Transformational Lean
Managers Need to Do?
• Gain agreement on what is important, specifically what customer
problems an organization will solve and how and the gaps.
• Create, sustain & steadily improve the value-creating processes solving
customer problems.
• By aligning & engaging everyone touching these processes to deploy,
sustain & improve them.
• Sum up: Managers need to focus on purpose, process, and people.
 Objective of this Presentation
• Creative thinking about the type of management system you
need so that lean deployment is sustainable.
• Let’s start by comparing traditional, modern & lean
management.
(As we do this, please ask yourself what type of management
system your organization has today & what type it needs for
a lean transformation.)
 Three Choices for Managers:
• Traditional management
(The small family firm; the school of “common sense”.)

• Modern management
(The Alfred Sloan School of Management.)

• Lean management
(The Eiji Toyoda Gemba School of Management.)
Let’s compare the principles of these three “schools”.
 Traditional Management

• The way of the world for eons.

• Clear “boss” (often the owner) at the top whose relationships with
direct reports are often based on personal loyalties.
• Planning and direction from the top with few feedback loops.
• Little in the way of objective measures of performance or immediate
feedback.
• No method for steady improvement: “If there is a problem, ask the
boss.”
 The Problem with Traditional
Management
• Sometimes works but…doesn’t scale.
• Henry Ford is the best example.
• The rise of “giant enterprise” at the beginning of the 20th
century required something very different.
• Alfred Sloan’s (GM) modern management was the answer
(elaborated by GE.)
 Modern Versus Lean Comparison
• The next 12 slides will compare modern management (in
normal type on the upper part of the slide) with lean
management (in italics below.)
• For each slide please ask yourself where your organization
stands.
• And remember that yours may be a large traditional
management organization instead.
 Modern vs. Lean Management

• Primary focus on vertical functions and

departments, as mechanisms of optimization
and control. (Org chart management.)

• Primary focus on horizontal flow of value across

organizational units to the customer.
 Modern vs. Lean Management

• Clear grants of managerial authority by leaders of

organizational units (through vertical delegation).

• Clear grants of managerial responsibility to solve

problems (especially cross-functional, horizontal
problems) over which managers have no authority,
within vertical organizations (including Toyota.)
 Modern vs. Lean Management

• Line managers judged on end-of-the-period results for their

span of control, increasingly financial in recent times.

• Line managers judged on the state of their process, with

rapid feedback loops with next-level management.
“If the process is right the results will be right. Manage by process instead
of results.”
 Modern vs. Lean Management
• Planning & direction from top down, with bosses giving answers:
Leads to compliance focus: “Make your plan and/or explain the variances.”

• Planning & direction in circular feed-back loops, with bosses asking

questions:
“What do you think the important issue is? Is it a problem?”
“What’s the root cause of the problem?”
“What do you think the potential solutions (countermeasures) are?”
“What countermeasure do you think we should select to test?”
“Who must do what when where to test this countermeasure?”
“What will be the measure of success?’
 Modern vs. Lean Management
• Conviction from the top that a good plan, once properly
implemented, produces the desired results. (Justifying the
compliance focus.)
• Conviction that all plans are experiments and can only be
evaluated through the scientific method in the form of PDCA,
followed by appropriate countermeasures.
“Planning is invaluable; plans rapidly become worthless.”
 Modern vs. Lean Management

• Generalist line mangers, rotated frequently with

weak process knowledge, supported by technical
staffs (including finance.)
• Line mangers on extended assignments, with deep
process knowledge, lacking the need for extensive
staff support.
 Modern vs. Lean Management
• Managers developed through formal education, often outside
the company (e.g., management schools, consulting firms), or
by sink-or-swim rotations.

• Managers developed through in-company gemba learning:

repetitive hoshin, A3 analysis, and standardized management,
in dialogue with superiors, peers, and direct reports
throughout their careers.
 Modern vs. Lean Management
• Decisions made far from the point of value
creation, by analyzing data. (“Conference room
management.”)

• Decisions made at the point of value creation, by

converting data into facts (“Go see, ask why,
show respect” gemba management.)
 Modern vs. Lean Management

• Problem solving and improvement conducted by staffs (or

consultants), often through programs with end points.

• Problem solving and improvement conducted by line

managers, often responsible for cross-functional analysis,
with staffs reserved for unique technical problems.
 Modern vs. Lean Management

• Standardization of work (if any) conducted by staffs, often

with little gemba interaction and with pro forma staff audits.

• Standardization of work conducted by line managers in

collaboration with work teams, with frequent auditing by line
managers by means of “go see, ask why, show respect”
direct observation.
 Modern vs. Lean Management
• “Go fast” as a general mandate:
“Jump to solutions” (with the consequence of going slow through the
complete cycle of product & process development, launch & fulfillment,
and problem solving.)

• “Go slow” as a general mandate:

“Start with the problem” and consider many potential countermeasures in
parallel (with higher costs & more time at the beginning, followed by
lower costs, less time & happier customers at the end.)
 Modern vs. Lean Management
• Strong emphasis on the vertical flow of authority, looking
upward toward the CEO.
Performance usually evaluated at single points.

• Strong emphasis on the horizontal flow of value, looking

toward customers.
Performance evaluated in terms of optimizing the whole process (all of the
points).

Control reconciled with flexibility!

 Conclusion from This Comparison
• Neither traditional nor modern management is
conducive to creating sustainable lean
enterprises.
• We need to transition to lean management (or
something better.)
• How can we do this?
Incidental Work of Management
• Gaining agreement across the organization on what’s
important for customers and the company (purpose),
through strategy deployment (a process).

• Deploying on important initiatives from SD to seize

opportunities & solve problems and evaluating proposals
from lower levels, with A3 analysis (a process).
 Incidental Work of Management
• Creating basic stability and daily improvement throughout the
organization, using standardized work with daily standardized
management (a process), with continuous kaizen.

• Educating the next generation of managers, by engaging direct

reports in endless cycles of strategy deployment, A3 analysis,
and standardized management.
 Methods of Lean Management
 Strategy deployment – to align and engage
employees on the few critical issues facing the
organization – the work of top management using
catch ball with every lower level.
Note: The transition from modern to lean
management might be an objective identified by
strategy deployment!
 Methods of Lean Management
 A3 analysis – to deploy top-level mandates, solve daily
problems as they arise, and (very important) evaluate proposals
from lower levels of the organization.

 Never a solo assignment; always done in vertical and horizontal

dialogue. (“An excuse to have a constructive conversation with
everyone touching a problem about where you are & where you
need to go.”)
 Methods of Lean Management

 Standardized management of standardized work

with continuous kaizen – to stabilize the
organization and permit steady improvement.
 Daily status checks and face-to-face discussions
about objective facts (using visual control) at every
level of the organization.
 A Word About Kaizen in Chaos
• Most of what modern managers call “kaizen” is actually re-
work to get back to where their process is supposed to be.
• Most managers spend about 80% of their time working on
“exceptions” (things gone wrong needing immediate
correction.)
• They need to create basic stability and real-time problem
resolution so they will have time for true kaizen =
improvement above previous levels of performance.
 Methods of Lean Management

• Educating the next level of management to

create lean managers through continuing
dialogue about problems and opportunities.

• Final element of the work of management work

at every level of management every day!
 But…Avoid the Tool Trap
• We often see examples of Strategy Deployment (Hoshin
Planning), A3, and Standardized Management with Visual
Control used as more tools.
• Quick and top-down with no dialogue.
• A humble, respectful vertical and horizontal conversation
about problems and countermeasures is the heart of lean
management and the only path to success.
Great A3 Project for Your Management Team:

• Analyze your organization’s management system.

• Characterize its current condition.
• Determine the ways it hinders lean deployment. (The Gap.)
• Identify the most promising countermeasures. (The Plan.)
• Test these countermeasures. (The Do.)
• Assess the results. (The Check/Study/Reflect.)
• Make changes as necessary. (The Act/Adjust.)
 The Role for Lean Leadership
• Taking the lead in introducing a lean management system in
your organization.
• Sharing it with your suppliers and customers.
This is hard and requires perseverance!
But…if you succeed in introducing lean management you won’t
need much heroic leadership in the future.