Whoa! I can hear you saying it now: "What is this guy thinking – it's not good to be green?" Of course it is, you say. Environmental stewardship is a key business measurement, a worthy goal to strive towards. I've written about the environment, Earth Day, reducing power consumption and saving paper, so how could I be saying that it's not good to be environmentally aware?
I'm not. What I'm saying is that it's not good to be green in your operating metrics. Now that I've thoroughly confused you, let me explain.
The ostrich syndrome
Common folklore says that when people want to avoid a troubling issue they stick their heads in the sand like an ostrich. Well, I hate to burst your bubble, but an ostrich doesn't actually do this. If an ostrich did it would suffocate and die. If you, as a company owner or executive, stick your proverbial "head in the sand" when it comes to your company's health, your company, too, would soon die.
Although this seems to make sense to most companies and executives, indeed to almost anyone, too often I see companies unknowingly sticking their heads in the sand when it comes to their companies' health, because everything is "green" – that is, everything is good.
We're good, they'll say. All of our charts, graphs, measures and metrics are all positive – they're all "in the green." We have no problems, so we don't need to change anything; everything is just fine. If this is you, then you're sticking your head in the sand and you are in danger of suffocating your company.
No problem IS a problem
There is a saying popularly attributed to Toyota that "no problem is a problem." It has been reported that, when asked by a Toyota executive what problems were occurring at the New United Motor Manufacturing Incorporated plant (NUMMI), the joint venture between Toyota and General Motors, a GM manager responded cheerfully saying something to the effect that "everything is good, there are no problems." This manager was then told "no problem IS a problem!"
Now, the statement "no problem is a problem" is not meant to belittle or humiliate anyone but, rather, to point out the fact that nothing is ever perfect and, since nothing is ever perfect, there will always be problems to be solved. Looking at charts that tell you that everything is "good," that everything is "green," that there are no problems, is leading you into a false sense of security that there are no issues in your organization that need attention, that there are no problems that need a solution.
This is the business equivalent of sticking your head in the sand. If you can't see the problems then there must not be any.
Stress the system
The only way to discover problems or, to put it another way, opportunities for improvement in your company is to do what the Lean community of practice calls "stressing the system."
You're probably thinking right about now that I've really gone off the deep end. Stress the system? Stress? Whatever happened to "respect for people" and eliminating unreasonableness or muri? Am I really telling you to stress people out? No, of course that's not what I'm saying you should do.
Stress is defined by Webster's as "strain, pressure" or as a "constraining force or influence." The verb, stress, is defined as "to subject to physical or psychological stress."
Let's all take a moment to remember what Lean is about. Lean, first and foremost, is about people. People are an organization's most important asset. To drive that point home, tell every person at work to not come in tomorrow and see how much work all of your fancy, expensive equipment gets done. Zero, that's how much. Without people, without our most important asset, nothing would get accomplished, so I'm certainly not advocating adding stress to anyone's life.
Lean is about a system of managing your business. Webster's defines a system as "an organized set of doctrines, ideas, or principles usually intended to explain the arrangement or working of a systematic whole." Jamie Flinchbaugh, author of the highly regarded book The Hitchhiker's Guide to Lean – Lessons from the Road, writes about a system being the "series of activities, connections and flows" in an organization. It's this system that you need to stress, not your people.
Try this: Gradually lower your inventory levels, both WIP and finished goods and still try to maintain your on-time delivery rates without adding hours or extra staffing. How? Seek out and eliminate waste in your system. Remember waste? Waste is anything that the customer is not willing to pay for. Waste does not add value and is something that should be eliminated. Remap your value streams to find this waste and use the collective experience of your employees to find root causes and to implement counter measures.
Audit for action, not just activity
Audits in and of themselves are waste. Audits do not add value to the product or service that you are providing. Audits can be useful, however, if the information that is discovered during an audit is used to take action to eliminate waste. Too often, though, companies audit their systems, post charts, and breathe a sigh of relief if everything is "green" – if everything is good. They then print out charts showing everything is good and post these for the world to see.
Does this activity – posting colorful charts – really add value to your product or service? No, it does not, so don't delude yourself into thinking that it does. All these charts are saying is "hooray for us – we didn't screw up as badly as we had planned for in our budget!" What these charts ought to be telling you is where you need to stress the system, where you need to take action.
Many companies who think they are Lean, green, fightin' machines post 5S scores (Sort, Set in Order, Shine, Standardize, and Sustain). Many proudly boast of how long they've achieved positive scores, believing that this is indicative that they have "a place for everything and everything in its place." If a company's 5S scores really are that good then I should also see consistent improvements in injury and accident prevention, on-time delivery, defect prevention, scrap reduction, and inventory turns but, sadly, I don't. These companies don't understand what the 5S tool is all about, that it is part of a system that constantly strives to eliminate waste.
Find the weakest link
5S scores, or any metric for that matter, that are always "green" tell me that a company needs to stress its system. It needs more stringent audit standards, first of all. It needs better training on how to identify and eliminate problems, because if safety, quality, cost, and delivery are not improving along with your supposedly positive trending charts, then the system is not being stressed.
Find the weak links in those "series of activities, connections and flows" that are causing downtime, delays, and waste, and eliminate them. Use your metrics and the information that they provide as a guide for where you should take action, and not as a lagging indicator of where you have been.