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Published July 7, 2009
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If you were to do a search of company mission statements you would probably find that many companies, if not a majority, make the claim that their employees are their most important asset, or something to that effect. It's a nice statement, but is it really true?

Respect for people


Ask any seasoned Lean practitioner and you will hear about two basic tenets of the Toyota Production System, or pillars of the "House of Lean." They are Just-In-Time and Respect for People. Most companies – in fact, an overwhelming majority of companies – that have attempted to emulate the Toyota model, have failed miserably due in large part to their reliance on only one of the pillars – Just-In-Time.

These companies suffered from "tool-itis," a condition that manifests from investing only in specific tools, like SMED or 5S, which leads only to isolated and unsustainable improvements. These companies failed to invest in their "most important asset" and, therefore, failed to show true Respect for People.

It's about people


Lean, first and foremost, is about people. Businesses do not run without people, yet most businesses spend only fractions of a percent of their annual budgets on cultivating and supporting these "most important assets." Like our machines, we run our people until they break and, like our machines, poor quality and service usually start to appear long before our people finally break. We need to maintain the skills that our employees have through continual education and training, we need to eliminate work hazards, we need to relieve them of any unnecessary burdens that wear them down and cause them to have an injury or to produce or miss defective products. In other words, like machines that need total productive maintenance, our employees need total people maintenance.

TPM – Total People Maintenance


There's a saying that Toyota doesn't build cars – they build people, and their people manufacture products that consumers want to buy. A great deal of time, effort, and money is spent on building these people, this most important asset. During this current recession, Toyota shut down production at their Princeton, IN, and San Antonio, TX, plants in the US, but didn't send their full-time people home. Instead, they used this time to send their people through additional training. The cost was estimated to be $35 million dollars, but Toyota recognizes that this investment will pay off in multiples down the road through employee retention (lower recruitment and new hire training costs), fewer defects, and one giant intangible: loyalty. Now that's an investment in their most important asset.

What about your company? Are you using this slowdown in business to reassess your employees' skills and provide the necessary training to improve these skills, or have you cut your staff back to the bare minimum and now no one has time to catch their breath, let alone for training? For many companies, it's the latter.

Respecting your employees doesn't mean simply being nice to them, nor does it mean knowing the names of their children. Many senior executives and company owners feel that they already respect their employees, but if you are one of these executives and you are more concerned about pleasing shareholders than treating every stakeholder – including employees – with equal respect, then you do not respect your employees. Pushing people – and their equipment – to their breaking points at the end of a month or quarter just to "make the numbers" shows a complete lack of respect for employees.

An investment in the future


Training is not an expense – it's an investment. Benjamin Franklin said, "An investment in knowledge always pays the best interest." A company that invests in its people can realize fantastic returns.

A few years ago I was reading an article about Kip Tindell, chairman and CEO of The Container Store. In this article Kip was talking about some of his basic management philosophies, including focusing on the company's most important asset, the employees, and the investment the company makes in these assets. He said, "If you take care of your employees, they'll take care of your customers – and that will take care of your shareholders. To myopically focus on the shareholders is wrong, (so) we invest heavily in our employees. Our sales staff receives 240 hours of training; the industry average is eight."

It's this attitude that propelled The Container Store from an initial investment of $35,000 in 1978 to a $500 million juggernaut by 2007, one that experienced 15 to 20 percent annual growth year after year. They didn't grow by focusing on the client. They focused on the employees and the employees took care of the business.

Ask, don't tell


Companies that truly show respect for their employees ask for their help in solving problems rather than dictating expectations.

Companies that truly show respect for their employees gives these employees the proper training, tools, materials and equipment to do their jobs properly, and then lets them do their jobs.
Companies that truly show respect for their employees will give these employees a safe but challenging work environment, one that utilizes their innate talents and learned skills in a constant pursuit of perfection.

Companies that truly show respect for their employees recognize that the aggregated years of experience that these employees have is worth its weight in gold, and that mining these nuggets of gold will result in payoffs well into the future.
Tom Southworth is a Lean Consultant with CONNSTEP, Connecticut's Manufacturing Extension Partnership (MEP). He is a Senior Member of ASQ, an ASQ Certified Manager of Quality & Organizational Excellence, and is a SME Lean Bronze Certified-sensei. He can be reached by email at tsouthworth@connstep.org.


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