In Part 2 of our series we interview David Joyce. He is an Executive Consultant, Systems Thinker and Lean practitioner who has 15 years of leadership experience, and 20 years of experience in the technology industry. Today, David spends his time working with executives, senior managers, front-line leaders and teams helping them instigate sustainable change by applying methods such as Agile, Lean, Systems Thinking and Intervention Theory. He is a recipient of the Lean SSC Brickell Key award for outstanding achievement and leadership, a founding fellow of the Global Lean Systems Society, and has recently published a free eBook titled Theories of Work: How We Design and Manage Work
Q: Your work on applying Systems thinking and Lean practices at the BBC earned you a lot of kudos and the Brickell Key award. What was your main learning from your work at the BBC?
A: I once worked for an Internet video startup. I took all of my Agile knowledge with me into that company and helped them, through the use of Agile management and Agile Development methods, to envision and build innovative products. We lived the Agile dream with business and development co-located, XP development practices in use, fleets of automated tests, continuous delivery of the product, automated deployment, Scrum of Scrums, and Kanban for Operations. Unfortunately we went bust, as we lacked customers!
This was a big influence on my career and on my next role heading up delivery teams at the BBC. I learned, painfully, that it's not only about building something better; it's essential to learn how to build the right thing.
Thus at the BBC I started using methods such as Systems Thinking, Lean and Kanban, in addition to Agile. As a result of my time there, my learning, and thus my focus, became three fold - Firstly how do we ensure we are building the right thing for customers? Secondly, how do we build that in the most efficient and effective way? And thirdly, how do we look at our organisation from a systemic point of view; to ensure that any problem we solve makes the whole organisation better able to meet its customer’s needs.
I also started publishing the methods I was experimenting with at the BBC on my blog. The results published on the blog led to an academic study being conducted on our work at the BBC by Dr. Peter Middleton. He published the findings in the IEEE Transactions on Engineering Management. Today, each month, thousands of people view this blog, or read the study, using it as a free resource to help them in their own experimentation.
Q: You have road-tested Systems Thinking, Lean and Kanban practices globally, in both the east and west. What have been the challenges you have faced when putting them into practice in their respective cultural milieus?
A: I have learned that the superordinate problems that executives are trying to solve are universal. Their particular operational problems may differ, as may the problems that their customers want solved, however it is my experience that most executives, regardless of country and culture, are trying to increase customer satisfaction, reduce costs, increase revenue, increase efficiency, and increase the morale of their people who work in their organisations.
When researching my book, I learned that the way executives go about solving those problems is based upon a particular management paradigm for designing and managing work, and that paradigm is pervasive globally. What astounded me is that this paradigm has come from a theory of work invented to solve problems prior to World War I. Industrial problems. There are pockets of difference today, but regardless of industry, domain, country, size of company, ownership type - private or public, or whether it is established or a startup, the same design and management norms are in place. Despite the time elapsed since their invention, these norms seem remarkably impervious to change. It is therefore more of a challenge to convention rather than culture that I see everyday.
Q: Traditional approaches to management practices seem to have evolved into a case of diminishing returns, stifling innovation and killing growth. How does an organisation break this mould and inspire creativity and innovation?
A: Gary Hamel proffers, “Management, like the combustion engine, is a mature technology that must now be reinvented for a new age”. Pick any management “guru” since World War II and they will espouse the same. All nice words. It is a fact that many alternative management methods have been suggested in various publications, but these just rebound off the status quo. The list of panaceas and fads that promise much, and purport to be the next big thing, is endless. Yet, they all come and go, and organisations are left as they were.
Steve Denning writes, “Studies show that half a century ago, the life expectancy of a firm in the Fortune 500 was around 75 years. Now it’s less than 15 years and declining even further”1
So we have clarity on the problem to solve.
Some people believe that what is needed is Organisational Agility - to be more able to adapt and respond. I would agree that organisations need to be more nimble and more responsive, however I also see the need for organisations to be more proactive, forcing their competitors to have to adapt to them.
Unfortunately Organisational Agility has become an overloaded term. The term Agile has taken on new meaning for many organisations. If you Google the term today, “Agile” will return as “Agile software development” or “Agile Project Management”. For many people this is the answer to the Hamel and Denning’s statements; if an organisation “scales” Agile it will solve its ills. Such protagonists won’t be content until the Chief Executive and board are all “doing stand-ups around a whiteboard”. It is my opinion that this is a fundamental flaw in logic, as it is addressing the wrong problem.
The real problem to solve is how do we change the way leaders in an organisation think about the design and management of work? How do we act on the organisational system that they have unintentionally created that stifles creativity and innovation? It is therefore more of a problem of organisational design than one of organisational agility.
To describe the problem, Simon Baker states, “The status quo demands that bold ideas be watered down, the corners cut off, and a safe decision be made that makes little difference”. As does Rich Rogers - “Big companies don’t innovate because they need a whole hierarchy of people to agree that an idea is good in order to pursue it”.
It’s this kind of thinking, and how it is manifest in an organisational system, that is the real problem to solve. Management needs to become a verb rather than a noun.
Q: What are some key pointers for executives to kick start improving their organisations?
A: Many executives live on an executive floor in a glass office. They see how, and how well, their organisations are doing through reports. These reports contain lagging measures such as; customer satisfaction, financial measures, achievement of milestones, sales data, quality statistics, staff morale and the like. These lagging measures only tell the executives what has happened. As W. Edwards Deming said, “It is like running a company from the rear view mirror”. John Seddon also emphasizes this when he says, “In organisations people learn to write reports that keep them out of trouble. People learn to develop a range of excuses if the numbers don’t look right”.
Deming would tell leaders that they make two mistakes:
To take the right action is to take action from a position of knowledge. With any leader I work with, the first thing we do is go into the work, to truly understand how the organisation is performing. They learn that it rarely matches what was said in the report. From this position of knowledge, a leader can then make better choices on how to improve their organisation.
Q: Do you advocate implementation of just one particular methodology, or do you prefer tailoring an approach per organisation based on various practices? What are your thoughts on mixed approaches?
A: Whenever leaders ask me “should we implement a particular methodology?” I quote Taiichi Ohno, who is considered to be the father of the Toyota Production System (today often known as Lean). When he set out, his system had no name. Ohno famously said, “If you were to give a system a name, managers will expect it to come in a box!” Instead of buying a boxed solution, Ohno ensured his managers spent weeks observing real problems in Toyota’s production facilities. He would literally tell them to stand and observe the work. He would then meet with them and ask them to reflect on what they had seen. Toyota managers in Japan still learn the same way today.
Steve J. Spear in a Harvard Business Review articles entitled “Learning to Lead at Toyota” wrote, “It takes more than three months [of training] before a new manager even arrives at the plant in which they are to be a manager".
Managers come out of their training realizing that improving actual operations was not their job - it was the job of the workers themselves. The manager’s role was to help them understand that responsibility and enable them to carry it out.
The main lessons Toyota managers learn are:
I believe tailoring through experimentation is the answer. Not to engage in “industrial tourism” to see how others are doing it and to then copy them, nor to purchase an off the shelf “best practice” solution to install into an organisation, but to instead learn in your own place of work and conduct experiments, whilst emprically measuring any betterment achieved.
Q: Measuring “value” seems to be the holy grail of measurement. What are your thoughts on going about it?
A: This certainly is a hot topic. It astounds me that this isn’t “front of mind” for every leader that I meet. Certainly a CEO is thinking about this, as they are the one person in the organisation who thinks of their organisation as a whole. However, most leaders have operational problems in their part of the organisation to solve. They are more concerned with efficiency, getting stuff out faster, sweating their assets to be more productive, or are concerned with hitting their numbers. That said, there has been an upward trend of people in organisations now talking about value.
Conversations around value paint a picture in my head of “gold at the end of the rainbow”. Organisations struggle with articulating and measuring value. There are lots of examples of pseudo value in organisations, such as what can be entered into a business case. However, when you study the organisation, you learn that these “benefits” were either put in to get through the funding gates, or are claiming the same benefits that other business cases are also claiming. I worked in one organisation they added up all the FTEs (full time employees) that would be reduced once all the inflight projects were complete. The number was higher than the company’s entire workforce!
Some organisations are trying to address the problem, by attempting to make discussions on value transparent and collaborative. It is a step in a better direction. However, in these organisations the most sophisticated method is opinion-based value ranking. Value is in the eye of the beholder. For some, value is about cost, or is about efficiency gains, or is about productivity gains. It is my view that this is focusing on the wrong things. The most important commodity for an organisation is the customer. Therefore, shouldn’t value be tied to what customers see as valuable?
I have learned that value needs to be empirical. We need to understand empirically the problems end-customers want solved, and then experiment to perfectly deliver that. With empiricism, the way we go about thinking about value today is turned on its head. It removes assumption from the room.
Risk is where knowledge ends. If we empirically understand what matters to customers, we reduce risk, and we can base prioritisation and funding decisions on knowledge rather than experience-based opinion.
Q: How easy is it to transition Lean and Kanban practices to the IT organisation, given that they were used for more traditional manufacturing and production processes?
A: It is a mistake to try to implement methods that work in manufacturing to non-manufacturing organisations. I have observed Lean working well for where it is meant; manufacturing. Where it goes awry is trying to implement those same methods elsewhere.
Ohno had a particular problem to solve - produce vehicles at the rate of customer demand. He solved this problem using methods such as Standardised work, Kanban, Poke Yoke, and also by measuring; demand, flow, end-to-end time and takt time. His focus was never solely on removing waste. His focus was on reducing the time it takes for order to delivery. A subtle difference many have overlooked.
When I visited Toyota City in Japan it now takes them 22 hours to build a vehicle from start to finish - a remarkable achievement. However, this wasn’t achieved by copying someone else, it wasn’t achieved by implementing best practices, it was achieved by challenging what at the time were management norms, and through experimentation, coming to the methods described above. They learned, through study, about variation in demand, overburden and overloading.
In non-manufacturing organisations the variety in demand is so great that you cannot run an organisation like a production line. However, many leaders of organisation try to, and then wonder why they don’t get the results that they want.
Some people think that Lean is all about removing waste. They advise we spend time in our organisations seeking out waste and removing it. Doing so will increase efficiency. This is music to the manager’s ears! What manager wouldn’t jump at the chance to remove waste in their organisation. In some organisations there is a new role of "Chief Waste Officer"!
The problem is a simple one, what led to that waste in the first place? It isn’t organic; it didn’t just “grow”. The waste was unintentionally created by how we think about the design and management of our organisations. Therefore to transition an organisation requires a change in thinking.
Q: Lean and Kanban both emphasize “total visibility”. What are some ways of putting that into practice - value stream mapping, a Kanban board, and/or?
A: In my view, to achieve visibility, the starting point is to make visible how work currently flows through an organisation. A leader should not abdicate this for someone else to do; the leader should do it in their own place of work.
How it is actually visualised is irrelevant, the heuristic learning the leader has from spending time immersed in her/his own operation is the key. They visualise it with their own eyes.
They will no longer look at a visualisation of work done by someone else which can only ever result in them reacting by bringing their current logic to bear. Instead they will see work differently.
As Ohno stated, “Anything can be improved, if you know how to look”.