BIG boys on the ‘lean’ bandwagon

I was asked to take a look at a BIG consulting firm’s ‘lean’ transformation programme in a financial services organisation. It was a tool head approach. No knowledge of the nature of demand (the greatest point of leverage) and no knowledge of the impact of system conditions, in particular measurement, on performance.

Instead, ignorant of the damage it would cause, the interventions proposed establishing standardised work design, standard operating procedures and measuring and managing workers’ activity. I pointed out that this was the problem with the so-called lean intervention in Her Majesty’s Revenue and Customs (see ‘HMRC does ‘command-and-control lean”, August newsletter and ‘When ‘lean’ is mean’, May newsletter. It has caused HMRC workers to go on strike. They surprised me by telling me these consultants were in fact the very same people who had been working with HMRC.

I asked if they had questioned the consultants about the problems in HMRC. They had, and the consultant’s response had been the workers in HMRC would take time to get used to it. Ha!

On reflection, I think they invited me to look at this work because they were after a bit of Vanguard’s ‘special sauce’ to add to and improve their consultant’s intervention. Tricky, as to do so would be mixing chalk and cheese; oil and water. The BIG boys are on the lean bandwagon, selling a version of ‘lean’ which is not lean at all but which will appeal to command and control managers.
Small boys trying it too

A private sector out-sourcing organisation saw the power of the Vanguard Method when it was applied in one of their local authority clients. They noticed how excited the client got about it. Well you would if you experienced massive improvements and a transformation in morale to boot.

Having worked alongside Vanguard they think now they know enough about our work to offer this as a service to the market. If they are able to hoodwink people into believing them and if they are able to begin to get such clients up the learning curve, the clients will find them out. These are people who, for example, offer ‘CRM solutions’ to local authorities that do nothing more than institutionalise failure demand. They also make a fortune out of ‘backlog busting’ benefits services that, if they were truly systems thinkers, they would cease providing and instead would offer to solve the problem where it should be solved – in the clients’ front offices.

These people are opportunists; they see how excited clients get about the Vanguard Method and want to jump on the bandwagon. But they have little knowledge and don’t know what they don’t know. It won’t be long before the clients discover that they make no use of these ideas in their own organisation. For them it is about making money, not learning to be systems thinkers.

‘Lean’ health care requires supervision

The NHS is experiencing a wave of euphoria over ‘lean’. In the form this is taking – lean ‘tools’ developed in manufacturing – this initiative will fail and that is a tragedy, for ‘lean’ has much to offer the design and management of health care.

One indication that the ‘tool heads’ don’t understand the problem is their assertion that the ‘lean tools will help the NHS meet its targets’. Targets, like all arbitrary measures, distort systems. Instead of using targets NHS people should be using real measures, derived from the work, that aid the understanding and improvement of that work.

A further indication that these interventions are doomed is the fact that the ‘new process designs’ being piloted have required extra supervision, to keep people from ‘slipping back’ to what they used to do. It illustrates that the ‘solutions’ are being worked out by people who then worry about how to get others to do it. This is never a problem for Vanguard practitioners, for the right way to intervene is to ensure the people doing the work are also responsible for designing it. It is to put design in process, an essential feature of the Toyota System.

My fear is that NHS managers, duped by the tool heads, will think they have ‘done lean’ when they have not even started. Taiichi Ohno must be turning in his grave. He taught us that what matters is how we conceptualise the problems. NHS managers are not being taught any of that.

The Vanguard senseis speak

We refer to Vanguard experts as ‘senseis’, borrowing the Japanese word from Toyota. The Vanguard senseis have two kinds of expertise: systems thinking – how to design and manage work according to systems principles, and intervention theory – how to make that change.

The last time we got together I asked some of the senseis to talk to camera abut their work. The videos can be viewed at:

Shared services – what works and what doesn’t?

Ministers are driving up the creation of ‘shared services’ amongst local authorities despite the complete lack of evidence as to what works. Vanguard has learned a lot about shared services, what works and what does not work, from working with local authorities over the last three years and we are going to present our findings in a one-day seminar on September 21st, near Bristol. (We will also be running this seminar in Scotland on November 22nd.)

We will show why planning and benefits should not be shared and how costs rise and service worsens if local authorities do share these services. We will also show how sharing services that can be shared often goes disastrously wrong when local authorities (often with private-sector contractors) go about sharing the services in the wrong way (as too many have). We will also give clear advice on the best way to go about sharing services.

Services to be covered during this day include: Housing benefits processing, Planning, Adult Social Care [all of which should not be shared]; Information technology (help desk, maintenance, development), Payroll, Procurement, HR services (recruitment), Council Tax collection and Environmental services [all of which can be shared but success will depend on method].

We will also discuss the problems associated with out-sourcing to the private sector and making information technology the driver of change. This event is for local authority and government personnel ONLY; private sector sharks milling around the shared-services-opportunity pool are not invited. NFI’d as my daughter would say.

The cost is only £75, to cover the event costs. To register: contact Polly Elworthy:, 01280-822255

Vanguard getting IT partner

Over many years we have lamented the waste associated with change that is IT-led. I wrote about the problems (‘Is IT bugging you?’ You can find this article here

The article also describes the way we work with IT when it is needed: First understand the work as a system, then improve it without changing the IT – you can turn it off or treat it as a constraint – then thirdly ‘pull’ IT into the new design. The result is you spend less and get much more from your IT.

We are in discussions with a non-propriety IT supplier, important because propriety suppliers want to sell boxes and design their own organisations that way. Together we are going to offer a unique service. More from your IT at lower costs. So if you are thinking about changing your IT system remember to put us on your list!

Criminal justice: solving the right problem

Tony Blair’s latest idea is to have police dispense instant justice, making the police judge and jury and taking us in the direction of being a police state. As ever, Tony fails to solve the right problem. The problem is our criminal justice systems takes too long to deal with offenders. It is a system problem.

Denise Toscani, Vanguard Scotland, has been doing some groundbreaking work on the design of the criminal justice system. This work shows re-designing the system as one (instead of many specialist functions) achieves exactly what Tony wants. You can read more about Denise’s work in the articles section of the web site (‘Putting the summary back in summary Justice’)

‘Reform’ of legal aid

A solicitor reader writes:

‘I wondered if the recently issued proposals for the reform of purchasing of legal aid have reached your attention. Setting aside any element of special pleading (legal aid accounts for 40% of our firm’s income) the reforms represent a monumental effort to engineer parts of the legal services market around standardised outputs and outcomes. The stated goal is of course to make provision of publicly funded services sustainable around a declining budget but I can’t help feeling that it is more likely to increase costs and drive the better providers out of the market place.’

He is right. Standardised outputs and outcomes will always drive up costs, as they are doing with protocols in the Health Service, as they do with the ‘schedule of rates’ in housing repairs and so on. Why? Because such initiatives stop the systems absorbing variety.

Working to standards

A reader writes:

‘My other half works in ‘IT’ – supporting a charity’s subscription database. The database is designed by a multinational software company and contains standardised address formats. The customer told him there was a problem with the database address standards, because their customers in the Falkland Islands received letters addressed as ‘Falkland Islands, Malvinas’ – and they found that more than mildly inappropriate. When asked to alter the database, the response of the software company was ‘we are following the industry standard’. When pointed out that this was actually insulting some customers, the response was ‘when the standard changes, we’ll change the database’.

My other half changed the database himself.’

Another industry standard that gets me going is the acceptable percentage of ‘power-dialled’ calls that leave the customer talking to no one. This may have happened to you, your phone rings and no one is there. The power-dialler has no agent free to pass the call to. Why can’t this industry decide that zero percent is the right answer?

I think I know why.

Spaces available on first Lean MSc

Cardiff’s first Lean MSc programme is scheduled to start in October. There are still a few places available. I think it is an exciting design; it is modular and will take place on student sites. So don’t think about it as ‘going to Cardiff’, think about it as going to lots of different service organisations where you will learn by keeping a good connection between theory and practice. Also, as you may know, it will feature Vanguard’s work: systems thinking: how do Taiichi Ohno’s ideas translate for service design, and intervention theory: how do you make the change?

I recommend the programme to you. So if you want an MSc after your name and you want to learn about the theory and practice of lean service I suggest you contact Cardiff without delay. Claire Gardner will provide more information:

The Toyota System for service organisations

There are still some places left at our event in October. If you are thinking about coming along don’t think for too long or you may be disappointed.