Leading Lean: Know the Score and What to Do
September 29, 2008
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You can’t manage what you can’t understand. Measurement by itself adds no value.
Scoreboards have been as big a part of sports as measurements have been of business. But measurement by itself adds no value. A common but flawed concept is that you can’t manage what you can’t measure. It would be more accurate to say you can’t manage what you can’t understand. Measurement is nothing more than a tool to aid in understanding the current state. As Albert Einstein said: “Not everything that counts can be counted, and not everything that can be counted counts.”
When I was a supervisor, before I earned the privilege of disrupting other supervisor’s lives, I endured a barrage of daily direction. This incessant direction-setting was based on fragmented information, flawed decision-making and misunderstood reactions, all derived from measurements but not from understanding.
This happens every day in organizations. An executive or manager asks a question about a safety issue and everyone immediately drops everything else to work on safety. Then a quality issue draws questions on the factory floor and the organization gets a short-term no-holds-barred focus on quality. One inquiry at a time based on some chart that’s a bit off kilter and the organization runs first to the cost side of the ship, then to the quality side of the ship, and soon the ship is just rocking with no direction at all.
When we create a model process of lean we start with a scoreboard, regardless of the specific process. It isn’t exciting but it is effective. A scoreboard is much more than measurements; measurements are just a tool. Writing measurements on some chart, hanging it up, and expecting everyone to divine what it means is not only insufficient, many people find it insulting.
The scoreboard itself is a process; it doesn’t just show measurements-it also shows everyone what needs to be done. Here’s how to make it so. First, your measurements must be balanced. Your scoreboard must present a balanced set of measurements-e.g., safety, quality, delivery and cost-as a whole. Balance prevents the organization from running amok without direction.
Second, your measurements must be predictive-this is the part that shows everyone what needs to be done. Most measurements are a look back, which is useful, but nowhere near as important as looking ahead. People shy away from predictive measurements because they are rarely comprehensive. But a partial look into the future is more useful than a comprehensive look into the past. Your purpose is to make decisions, and measurements that lead to action-instead of reaction-will produce more sustainable positive results.
Once you have a scoreboard you need a process for working with it. Lean leaders must not forget that people cannot be expected to start acting more productively and proactively just because they’ve put up a wall with numbers on it. So you need to develop a process that standardizes who will be involved in reviewing the measurements, what decisions they are expected to make, what actions they are expected to take, how frequently to meet and even for how long.
Remember to remind the team that you’re doing this to advance your progress along your lean journey! Whether you have 90-minute meetings on the third Friday of the month, 5-minute review meetings every morning, or follow some other schedule is not important. What is important is that you establish and follow a regular schedule to review the scoreboard, make decisions and take action for improvement.
Your scoreboard is your guide to generating understanding and agreement about the actions required for moving ahead in your lean journey. Measurements alone do not accomplish this.
Know the score, and you and your team will know what to do.
Jamie Flinchbaugh is a founder and partner of the Lean Learning Center in Novi, MI, and the co-author of The Hitchhiker’s Guide to Lean: Lessons from the Road. He shares his successful and varied experiences of lean transformation as a practitioner and leader through companies such as Chrysler and DTE Energy. He also has a wide range of practical experience in industrial operations, including production, maintenance, material control, product development and manufacturing engineering. Jamie is a graduate fellow of the Leaders for Manufacturing Program at the Massachusetts Institute of Technology, where his research thesis was on implementing lean manufacturing through factory design. He also holds a B.S. in Engineering from Lehigh University in Bethlehem, PA, and an M.S. in Engineering from the University of Michigan. To contact Jamie directly, go to the web site www.leanlearningcenter.com.
Scoreboards have been as big a part of sports as measurements have been of business. But measurement by itself adds no value. A common but flawed concept is that you can’t manage what you can’t measure. It would be more accurate to say you can’t manage what you can’t understand. Measurement is nothing more than a tool to aid in understanding the current state. As Albert Einstein said: “Not everything that counts can be counted, and not everything that can be counted counts.”
When I was a supervisor, before I earned the privilege of disrupting other supervisor’s lives, I endured a barrage of daily direction. This incessant direction-setting was based on fragmented information, flawed decision-making and misunderstood reactions, all derived from measurements but not from understanding.
This happens every day in organizations. An executive or manager asks a question about a safety issue and everyone immediately drops everything else to work on safety. Then a quality issue draws questions on the factory floor and the organization gets a short-term no-holds-barred focus on quality. One inquiry at a time based on some chart that’s a bit off kilter and the organization runs first to the cost side of the ship, then to the quality side of the ship, and soon the ship is just rocking with no direction at all.
When we create a model process of lean we start with a scoreboard, regardless of the specific process. It isn’t exciting but it is effective. A scoreboard is much more than measurements; measurements are just a tool. Writing measurements on some chart, hanging it up, and expecting everyone to divine what it means is not only insufficient, many people find it insulting.
The scoreboard itself is a process; it doesn’t just show measurements-it also shows everyone what needs to be done. Here’s how to make it so. First, your measurements must be balanced. Your scoreboard must present a balanced set of measurements-e.g., safety, quality, delivery and cost-as a whole. Balance prevents the organization from running amok without direction.
Second, your measurements must be predictive-this is the part that shows everyone what needs to be done. Most measurements are a look back, which is useful, but nowhere near as important as looking ahead. People shy away from predictive measurements because they are rarely comprehensive. But a partial look into the future is more useful than a comprehensive look into the past. Your purpose is to make decisions, and measurements that lead to action-instead of reaction-will produce more sustainable positive results.
Once you have a scoreboard you need a process for working with it. Lean leaders must not forget that people cannot be expected to start acting more productively and proactively just because they’ve put up a wall with numbers on it. So you need to develop a process that standardizes who will be involved in reviewing the measurements, what decisions they are expected to make, what actions they are expected to take, how frequently to meet and even for how long.
Remember to remind the team that you’re doing this to advance your progress along your lean journey! Whether you have 90-minute meetings on the third Friday of the month, 5-minute review meetings every morning, or follow some other schedule is not important. What is important is that you establish and follow a regular schedule to review the scoreboard, make decisions and take action for improvement.
Your scoreboard is your guide to generating understanding and agreement about the actions required for moving ahead in your lean journey. Measurements alone do not accomplish this.
Know the score, and you and your team will know what to do.
Jamie Flinchbaugh is a founder and partner of the Lean Learning Center in Novi, MI, and the co-author of The Hitchhiker’s Guide to Lean: Lessons from the Road. He shares his successful and varied experiences of lean transformation as a practitioner and leader through companies such as Chrysler and DTE Energy. He also has a wide range of practical experience in industrial operations, including production, maintenance, material control, product development and manufacturing engineering. Jamie is a graduate fellow of the Leaders for Manufacturing Program at the Massachusetts Institute of Technology, where his research thesis was on implementing lean manufacturing through factory design. He also holds a B.S. in Engineering from Lehigh University in Bethlehem, PA, and an M.S. in Engineering from the University of Michigan. To contact Jamie directly, go to the web site www.leanlearningcenter.com.
