Leading Change at the Speed of Electrons (Part III)
You now know that changing involves making good decisions lower in your organization. You also know that, to prevent infanticide, you need to first teach managers throughout your organization how to lead. The final piece is to discuss how that is all pulled together.
The answer is: Strategy. Toyota calls this piece Hoshin Kanri. We’ve interpreted it many ways in the US, but the term currently in vogue is True North.
How do we establish True North? The answer is that we go back to our Mission Statement. What is it we promised (our shareholders, our customers, our suppliers, our communities and ourselves) we would do?
An example might help. If your mission reads “… provide defect-free products on schedule…” we just committed to two things: 1. No defects in our products; 2. Products delivered on time.
How would you measure those? Defects are easy: 100% First Pass Yield (FPY) and no field returns.
On time delivery necessitates that we choose whose clock we’re going to use. I hope you choose to use your customer’s, after all, they are who keeps you in business. How would we measure On-Time Delivery? Well, to start, we need to deliver 100% on-time to our customer’s need date. If we didn’t commit to the need date, we might also track to our committed date, but we’d continue to track the need date, too.
Okay, your mission either states or implies a lot more commitments, but to keep things simple, we’ll stop with just these two.
Our next task is to establish who is determining these True North objectives. The answer is the senior site leader and their staff.
Then what? They establish how they’ll measure and at what frequency. They’ll also assign one person from that body (site leader & staff) who will be accountable for each of those metrics. There needs to be an identity between every metric and one person who will be ultimately accountable for performance against it. They’ll also set goals and agree to measure performance against each metric at least monthly.
Next, the body will cascade each metric down throughout the organization, assigning accountability to the next layer of managers. Each person assigned accountability is responsible for tracking their performance against their metrics and posting it publicly on what many call a Key Performance Indicator (KPI) board.
Next post, we’ll talk about KPI boards and how to use them as a way to ratchet up performance. Meanwhile, Get Lean, Stay Lean.
If you have questions or comments, contact me at: [email protected] Feel free to check out our website at: www.gettingtolean.com
