One of the things that attracted me to Toyota’s management practice years ago was the requirement that people must be respected in order for continuous improvement to take place. This includes all stakeholders – employees, suppliers, customers, inventors, and communities. Toyota’s management system is a significant break from the poor way in which stakeholders are normally treated in conventional management.
In this blog post, I want to give special attention to workers, as they are the good, hard-working people who actually create value in the goods and services that organizations produce. I had great hopes and dreams for them that, unfortunately, have yet to be realized.
Workers have not fared well over the last 40 years. That, of course, is an understatement.
Prize-winning economists assured politicians, CEOs, and the rest of us that various economic policies and corporate practices – free trade, tax breaks, maximizing shareholder value, mergers, closing factories, offshoring work, and the like – were good for the country and good for the economy, though workers would suffer some pain in the short-term as they found new jobs. Economists said it was OK to break symmetry and lead without respecting workers, and so that is what business leaders did. But, as time progressed, the new job would take longer and longer to find, the pay was usually lower, the benefits were fewer, less generous, and at always at higher cost to the employee, and raises were mostly non-existent. This would take a heavy toll on workers.
Lean came to us in 1988, and was deployed in organizations within the above circumstances, which reflected the traditional framework of economics in relation to corporate wealth creation and trade. Executives saw Lean as a new route to increasing the stock price in a time where “maximize shareholder value” was becoming ever-more prominent. I was often upset by what I saw, both outside the context of Lean and within. For example, organizations that improved processes under the Lean banner and then laid people off to secure extra savings that resulted from lower head-count. In many cases, Lean success proved to be inconsequential because corporate leaders would go on to close high performing plants and offshore work in search of lower labor costs. They did this at a rapid pace, which caused too much harm to too many people too quickly – not just millions of workers, but tens of millions of family members as well. To me, this was inhuman.
I was rather excited when the workbook Learning to See: Value Stream Mapping to Add Value and Eliminate MUDA came out in 1999. I thought that value stream maps would clearly prove to executives that they did not have labor cost problems, as they long thought they did. Instead, they had massive process problems, which were the actual cause of high costs. All that had to be done was improve the processes and grow the business using existing workers. There was no need to close factories or offices, lay off workers, and go through the trouble of offshoring work to low wage countries. Right? But it soon became clear that executives did not see it that way. They demanded process improvement and also got rid of their labor cost problem by dumping it onto society.
The timing for Lean to enter into everyday business practice could not have been worse. Of course, Lean had only a small role to play in relation to traditional economic thinking, trade policies, tax breaks, and so on. Nevertheless, Lean did not live up to its promise. Since the mid-1990s, I was always concerned about the time it took for managers to realize the importance of the “Respect for People” principle. The longer it took to realize this, the more harm and human suffering that would occur. In most cases, senior managers did not, and still do not, recognize importance of the “Respect for People” principle.
When the importance of the “Respect for People” principle finally became prominent within the Lean movement in 2007, the focus was entirely on the micro relationship of supervisor-worker, and not also on the maco relationships of management-labor, company-supplier, company-community, or company-country. Uggghhh! It was too just too late. Lean had been around for nearly 20 years, and the impression that Lean was nothing more than “tools for the manager’s toolbox” had solidified. Time ticked by, and workers continued to suffer for this and many other reasons unrelated to Lean.
I think some people view me as bit nuts and some of my writings as “rants.” While surely imperfect, it was, for 22 years, my way of pushing forward the “Respect for People” principle and developing practical pathways for better leadership using the model shown at right. I was simply giving voice to workers, expressing their most basic fears. They were well-reasoned cries to focus attention on bigger problems that Lean had the potential to help correct, if even in just a small way. Worker’s lives and livelihoods where being terminated. Families were being disrupted. Workers felt helpless and no longer in control of their destiny at work or at home. It made me cry. But, apparently, few who lead the Lean community saw what I saw, or, if they did, perhaps they did not care or felt powerless to do anything.
How much good can we do? I think most Lean people would say: “Not enough for it to be worth the effort.” I disagree. Even if the good we do is very small, it will be great for the workers and their families whom we have done good for. It is worth the effort.
Collectively, we failed to meet our challenge to use Lean management to respect workers; to help workers prosper and reduce human suffering. This remains our challenge. And it remains my hope and dream.