2022 has become a real challenge for companies and leaders around the world. The natural reaction to current challenges is either to freeze and do nothing, or to rebuild. The first option threatens bankruptcy, the second leads, at a minimum, to maintaining its position (which is already good), and at best to growth.
And, judging by the widespread implementation of various improvement systems, business has chosen the path of restructuring. At the same time, an analysis of these programs showed that everyone again focused on lean manufacturing tools (or simply “lean”).
However, looking back at the path we have traveled, we can safely say that introducing lean tools alone and using training manuals from consulting firms will not effectively transform your business. The same Toyota, which is taken as a role model, and whose brand is waved like a flag by endless management gurus, came to its approach over more than 40 years of constant development. And as the founders of lean manufacturing themselves admit, focusing on tools is a mistake.
Working in projects on crisis management, implementation of digital technologies in large companies and development of IT products in startups, we were constantly convinced of the same thing - we need not just a set of tools, but a systematic approach to management.
It is “systemic” because it consists of mutually complementary components, or, say, skills that form a single system and work interconnectedly.
At its center are people, with all their complexity and imperfection. After all, the main limitation and the main asset of any company is people. Personnel decides everything.
As a result, a systematic approach is a set of knowledge and skills that any organization and any employee needs in the 21st century. That is, it doesn’t matter who – the owner, general director, financial director, chief engineer, department head or production foreman. But what to focus on depends on the personality of the first person, the stage of the organization’s life cycle and its culture, as well as on the specifics of the activity (both the company and the individual manager).
Yes, before it was enough to have a T-shaped set of competencies, when you had one dominant (production, finance, office work), and the rest were formed at the level of “I’ve heard of this and understand the term.” But times change, technology develops. And now the time comes for TTT - a figurative set of competencies. This will be especially facilitated by the development of artificial intelligence, which will automate an increasing number of tasks. As a result, to win this race, you need to have both specialized expertise and the ability to manage, organize people, processes and use modern technologies.
Naturally, they will not be ready for this. Some will be flexible and ready for new challenges, while others will resist. As a result, the stratification between the poor and the rich, the successful and the mediocre will intensify even more.
And of course, it is impossible to master everything. You need to choose what to focus on and how to use tools, combine them, and to whom and what to delegate.
What components have we identified as the basis of a systematic approach?
Lean manufacturing is at the core of the production system of any large company. And you can immerse yourself and improve it endlessly.
But we believe that here it is necessary to focus not on tools and terminology, but on the philosophy and the very essence of lean manufacturing - creating a flow of value for the consumer and eliminating all waste.
As it turns out, not only products on an industrial assembly line can have value, but also the most ordinary office report. You just need to understand who needs this report (that is, who is your client in this particular case) and what is the life cycle of the useful information that the report brings to the client. The same goes for the products, services, apps, designs, and content we produce. The path from the conditional “raw material” to the user is the flow of value, which you must constantly optimize, eliminating all unnecessary, unreasonably expensive or slowing down elements.
It is this view of any process that should form the basis for determining the tactics and tasks that you need to complete, including when launching digitalization, optimizing processes, creating new products, etc.
We have articles dedicated to working with these tools.
2. Project and product management
Without an understanding of how to implement projects, what approaches exist, and product management tools, any of your initiatives risks turning into chaos, leading to exceeding the deadlines, budget and patience of customers or senior management. We have repeatedly seen great initiatives fall apart due to disorganized implementation.
We have articles dedicated to working with these tools.
3. Systems Constraint Theory
This is Eliyahu Goldratt’s methodology, the essence of which is that the productivity of any system is limited by its so-called “bottleneck”, and overproduction of other elements inevitably leads to a crisis.
As a result, one of the main tasks is to find these limitations, focus on them and step by step eliminate them. By reducing the number of restrictions, you gradually make your system more productive. That is, the theory of systems limitation teaches how to correctly prioritize work, select priority projects and, obviously, perfectly complements the concept of lean manufacturing.
Our article “Theory of System Constraints” is devoted to working with this tool.
4. Regular management practices
A set of regular rituals that allows you to wisely use not only your working time, but also the potential of each employee in the team. Again, the main thing here is understanding the essence of the tools, the ability to adapt them to suit yourself or the situation, and not simply following the recommendations. In classical theory, PRMs include
management planning;
delegation of authority;
work with feedback from subordinates;
organizing meetings;
work with personnel and decisions regarding people;
employee performance assessment;
personnel development.
We have articles dedicated to working with these tools.
5. External and internal communication
Communication within the team and with the outside world is the secret ingredient of any organization. Without well-functioning communication, it is impossible to implement changes; any project will get bogged down in formal notes and service documents, and by the time you find out about the problems, it will be too late. You will not be able to sell even the coolest product, implement and benefit from digital technologies, identify losses and optimize business processes.
Think about this: in the last five years, when the world began to actively switch to digital, and artificial intelligence became the head of many processes, the need for so-called “soft skills”, including competent communication and emotional intelligence, sharply increased. Why? Is it really necessary in the world of robots to be able to speak pleasantly and understand the interlocutor? The answer is yes!
If a syntax error leads to incorrect code and a non-working robot algorithm, then an error in understanding a live interlocutor or incorrectly chosen words can result in endless problems and conflicts.
This is exactly the reality we have now - 90% of problems in projects or work teams would never have arisen if people had simply sat down and agreed. If a crisis has arisen somewhere, then feel free to look for who did not hear whom.
We have articles dedicated to working with these tools.
6. Implementing change: motivation, PR, resistance management and leadership
A component directly related to communication and project management.
Changes in processes, work, life are always stressful. The manager's task is to reduce this stress through communication, to apply tools for introducing change so that new technologies are used and not considered imposed from above.
This is one of the most complex components of a systematic approach, located at the intersection of psychology, management and marketing - yes, you need to be able to sell ideas and innovations to your own employees. Otherwise you will face sabotage. Resistance to changes, even those aimed at improvement, is a normal reaction of a healthy person.
Another factor that influences the success of change is the team. It must be initially selected, trained, and sometimes changed.
We have articles dedicated to working with these tools.
7. Strategy and metrics, organizational structure, business processes
“A fish rots from the head” - remember this saying? So, the effectiveness and efficiency of an organization begins with the definition of strategy and strategic objectives, a described organizational structure and streamlined business processes. By the way, a quality management system based on ISO 9001 can be an excellent assistant here.
These three components form the conditions for the operation of other tools. And, in essence, they streamline communication with formal tools so that each person on the team does their job, knows where the organization is going, who to contact on a certain issue, understands how to do their job, and receives the necessary resources.
We have articles dedicated to working with these tools.
8. Digital technologies, data management, cybersecurity
Technology makes life easier - that's a fact. But it’s not for nothing that I mention them last: without the principles of lean manufacturing, streamlined communication and business processes, playing with digitalization is a waste of time and budget. After all, its task is to speed up and optimize processes and create new products. And this cannot be achieved without the previous components of the Systems Approach.
How many times have companies introduced technologies that no one uses? How many times have digital projects faced sabotage? Digitalization is too expensive a pleasure to approach it thoughtlessly, on the wave of fashion or simply based on someone’s advertising. In addition, it is also unsafe, and in some cases, criminally punishable.
Digital technologies are, first of all, the continuation of live communication and the simplification of existing information flows. They won't make you more effective if you're in chaos to begin with. But in the hands of a competent manager who understands data flows, digital technologies become a competitive advantage.
As you can see, all components are inextricably linked with each other. This is a competency matrix that allows you to comprehensively evaluate your company and take measures to eliminate errors or improve processes. In other words, the Systematic approach is an indicator of the balance of your business. It allows you to understand what exactly your organization is missing and focus on the limitations. see their cause and act in proportion to the current situation.
We have articles dedicated to working with these tools.
It is important to understand that although these are all seemingly separate tools, each of them is connected to all the others. That is, to unlock your potential, you need to focus on specific areas, but gradually develop all the others at least to the initial level.