The godfather of lean

I arrived early for a conference in Sweden as it gave me a chance to listen to an American professor who styles himself the ‘godfather of lean’. It was a public sector conference; the godfather promised he would talk about the public sector, but didn’t. He gave the audience his high-level view of the Toyota system (more on that coming) and his only case study was of work he did with a car-rental company which, frankly, he should have been embarrassed to show.

By his own admission, the intervention in the car-rental company had failed. It was done for the wrong reasons (to reduce costs) and it consisted of teaching managers on every car-rental site tools, having Kaizen events and training ‘lean coaches’. He told us that improvement was sporadic, senior management was not committed and the lean coaches got fired or moved on. To rationalise this failure the godfather told us the problem was that they had created a Buddha image but had forgotten to put a soul into it.

I was gagging. The problems they set out to ‘fix’ were the problems they thought they had, no studying the system to learn what problems they really had.

The godfather explained that lean is a philosophy, a set of values to engage people in the continuous improvement of safety, morale, quality, cost and productivity. All you need, he said was a process, something you repeat. If you have a customer and you do work for the customer, then it must be repeatable, he told us. He warned against believing that ‘what we do is different’, arguing that anyone who thinks they have lots of variety or think everything they do is a one-off, is kidding themselves; it is just a human defence. But of course this was his rationale for the emphasis on standardising work, at the heart of his tools-based problem-solving philosophy.

My gagging went to anger. My mind went to HMRC (newsletters passim) where standardisation has had a shocking impact on performance. While I sat through loads more mulch on philosophy (lean is a business strategy, people are the heart and soul, the pillars are continuous improvement and respect for people. You need to challenge, conduct Kaizen events, practice respect for people (again), encourage teamwork; and you must ‘go and see’) – a clutter of plausible maxims, I thought maybe I should ask the godfather a question about why the HMRC lean initiative has been such a costly failure. I thought I’d explain that the standardisation of work and daily problem-solving of management’s wrong problem (the number of bits of work you did) had led to a dispute between management and unions and massive failure demand downstream. What, I wondered, would be his view as to why? It would have served to alert the audience to the flaws in his witless ramblings; I didn’t expect a good answer.

After sitting there all morning, I was astonished to discover there was no Q and A. I left the room feeling furious that the audience – most of whom were new to these ideas – could have been so badly misled. Since then I have been told that avoiding questions from their audiences is normal practice amongst these ‘lean gurus’.

Then God sent an angel

I wandered around a vast exhibition space full of anger. I think God must have been watching, because the most amazing thing happened. A lady introduced herself. She was from the Swedish Tax office(!). She told me she had been to one of my seminars in Sweden in 2005, had seen the light and went back to her tax office and got started with systems thinking. She told me they had studied their system and re-designed it. They had halved failure demand, improved their services and massively increased capacity. Our joy in that conversation required neither of us to dwell for long on the rubbish peddled by the ‘godfather’.

Later, when it was my turn to speak, I told the audience that the angel would have been of immensely more value to them than the godfather.

I asked the angel whether she had encountered any obstacles on her journey. Only one major one, she said; head office. Head office like the results but don’t ‘get it’, so keep sending irrelevant, ill-informed ‘requirements’ and injunctions. Nothing new there then.

An encounter with Bundred

Regular readers will know of my views of the Audit Commission, so I looked forward to attending a roundtable debate with Steve Bundred, the chief executive. The purpose of the roundtable was to discuss risk, innovation and efficiency. Mr Bundred opened by noting the last ten years of increased funding (NHS more than trebled, local government more than doubled – wow!) and he took the view that innovation – like adopting choice-based lettings – (can’t believe he chose THAT), a strong focus on the basics of finance, good leadership and attention to innovations in multi-agency services would see us through.

It won’t surprise you to know that when my turn came, I pointed to the fact that improvement was not commensurate with the investment, and gave examples of how the centrally-promulgated specifications had actually made performance worse, and I talked of the Audit Commission’s central role in all that. The chair noted that Mr Bundred would have the right of reply. When he got it, Mr Bundred simply said: ‘John is wrong. Inspection cannot be a barrier to innovation because people are innovating’.

He is, clearly, more canny than his communications expert, who was fool enough to attack me recently in the LGC. But I sat there thinking this is a politician’s reply; just deny.

As the meeting broke up, I asked Mr Bundred if I could have a word. He looked at his watch and reluctantly agreed to a minute. I asked him if, as chief executive of the Audit Commission, he was a public servant. He replied: ‘The same’. So I put it to him that as a public servant, if told there is evidence of problems and, moreover, evidence of opportunity provided by different means, should he not at least enquire further? His reply: ‘I do listen to what you have to say, I just don’t happen to agree with it’.

And there you have it. It is a common response amongst politicians – treat evidence as opinion. But it should not be the way public servants behave. The good news is Mr Bundred is leaving the Audit Commission next year. The sooner the better.

A bonfire of the specifiers

The Audit Commission does more than inspect, it coerces public-sector managers to do the wrong things, like create back-offices and share services. Recently a systems thinker in a local authority told me they were having to spend £300K implementing things their inspector wanted to see, while being confident these things would make no difference to their services. The Audit Commission’s inspectors and all of those people who inhabit the specifications industry sitting over our public services are doing are just doing their jobs; these people don’t create their specifications with mal intent, it is their job to take the ministers’ policies and determine what the poor blighters who deliver public services should do. It is, as I often say, to confuse intelligence or experience with knowledge.

The good news is both opposition parties have cottoned on to the fact that this actually makes services worse. I am confident that the new government – when we get it – will abolish much of the specifications and inspection industry.

What amuses me is that when I ask opposition politicians about the specifics (will you shut down the Audit Commission, DCLG, etc?), they are guarded. I get winks, nods and smiles. When I push they express their worry that the current regime may steal their ideas. My view is who cares?

Vote for a sound policy

LGC is running a feature on policy pledges for inclusion in the incoming government’s manifesto. A bunch of systems thinkers have proposed ‘replace compliance with responsibility’. In the next few days LGC will be inviting people to vote. The ideas that come out top on the poll will be put forward to the incoming administration. Go to:


Here you will see the manifesto pledge, written by Anna Jennison-Phillips et al. When the voting starts (in the next few days) please add your voice.

HMRC help-lines don’t help

An accounting firm is warning people not to trust what they are told by HMRC’s ‘telephone help-lines’. They warn that the help-lines do not always give the correct answer; so if you rely on a verbal assurance from a telephone helpline and later get inspected by a tax inspector, it is likely that the inspector will take a different view. The inspector may then raise a penalty. The accountants say two recent cases show how the taxpayer suffers when there is a disagreement between the helpline advice and the tax inspector.

Amazing isn’t it? They design a service that doesn’t work and you suffer the penalty.

Regime bears down on benefit claimants

I received a mail from a man who received incapacity benefit. I say ‘received’ because without any notice it was withdrawn, and he didn’t find out until his benefit had already been stopped for four weeks. It put him into trouble with his bank, incurring overdraft charges.

Distraught, he phoned the DWP on an 084 number; as he is not a BT customer this is, he says, charged at a premium rate. After lengthy queuing he got told he could ask for the decision to be reconsidered (takes two weeks) and if he was not happy with the result of that he could appeal (takes up to six months). A form was sent to him so that he could apply for another benefit called ’employment and support allowance’. As he pointed out, all the information he had to put on the form was information the DWP already had.

Three weeks passed, no reply. Then lots of calling, being placed in queues, promised call backs which never came. When he did get to talk to people they could not help as his files were with ‘decision-makers’, who don’t take phone calls. More time passed, more phone calls that led to no help – he was even asked if he wanted to re-apply for incapacity benefit and he had to tell the agent the rules preclude someone re-applying within three months of being turned down. He just wanted the ‘reconsideration’ completed (now weeks overdue). He was forever promised call-backs and they never came.

More time passed, more calls and this time when he got to a person they told him his case had been referred to ’employment and support allowance’ because he had filled in the form. He was not happy, just wanted his ‘reconsideration’ completed, was (again) promised a call-back to let him know and (again) none came. More calls, got though to someone who told him the reconsideration was completed and as he was now in receipt of ’employment and support allowance’ (he was not), then the rejection stood.

The poor man is still spending most of his waking time trying to get someone to sort this out. He was, not surprisingly, going nuts. What caused him to write to me? He watched a video on the web (‘Culture change is free’) in which I talked about the problems with public-sector service factories. As he said

‘I want to thank you for your speech as all of the above makes sense now.’

I’m glad I helped him keep sane; but I’d be more pleased if we could get the DWP and the Treasury to recognise the error of their ways.

If you haven’t seen the video you can watch it at: http://www.vimeo.com/4670102

From efficiency to effectiveness: LGC conference, January 13th, London

I shall be speaking at the above conference. To book on-line go to: http://www.lga.gov.uk/events

Systems Thinking – introductory days

January 14th, Copenhagen; find out more at: http://www.vanguard-consult.dk/Arrangementer.htm.
February 4th, Bridgend (Wales); for bookings: info@vanguardconsult.co.uk

Open Fundamentals programmes

We are running two open programmes on Systems Thinking Fundamentals, one in Hull, the other in Bridgend (Wales). These are action-learning programmes where attendees are expected to do things in their organisations between the taught sessions. You get more time between sessions in Hull.

Hull dates: January 26th, March 5th, April 21st and May 26th.
Bridgend dates: February 9th, 16th, 23rd and March 2nd.
For bookings: info@vanguardconsult.co.uk