Lean Cultures in the Top Small Workplaces

Top Small Workplaces 2008 - WSJ.com

Today’s WSJ was well worth the $2.00. Yes, I subscribe to the
online Journal, but there’s something nice about reading the
regular print version while traveling. Maybe I should just buy a

Kindle
as a different way of avoiding printing articles from home? Has
anyone used the Kindle?

OK, I sidetracked myself. Do whatever it takes - beg, borrow, or
steal to get a copy of the special “Top Small Workplaces 2008″
section. Beg, borrow, or steal…. that DOES sound like Wall
Street. OK, sidetracked myself again. Focus.

This section had some amazing profiles of some small company
cultures (well under 1,000 employees for each company, many much
smaller). It was hard to see the magic in some of the profiles –
ooh, they have incentives for employees, how innovative (not
really). And not every winning company has the stereotypical
foosball table (although one does). Playing soccer in the hallways
does not make for a cool company — having the right leadership and
culture does much deeper than that.

A few of the listed companies really stood out as embracing Lean or
Deming management principles in one way or another. I bet it’s
easier to do this in a small company — “best small companies”
could just be “best companies” even though they aren’t the biggest
companies in revenue. They seem to be the biggest in spirit and
morale. So here we have the Lean Blog “best of the best”
choices:

ATA Engineering
Inc.

Dr. Deming would love this:

Bonuses also have an egalitarian flavor: All workers receive an equal percentage of
their salary as an annual bonus. The setup works that way
for a couple of reasons. ATA leaders believe that every employee
should reap the rewards of the whole team. Managers also feel it’s too hard to accurately
assess how much one employee deserves a bonus over another;
singling people out could result in unfairness and
resentment.

“It’s a controversial topic, but what we’ve found is it’s
extremely difficult to be fair and consistent if your bonus
policies are too differential,” says General Manager and Chairman
Jeff Young. “Someone who made a big splash may be compensated, but
someone who was silent and didn’t speak up wouldn’t be.”

That type of approach isn’t very common, is it? Most managers
insist they can somehow peg each individual’s contribution to a
team (or a very large corporation). Having been under many
compensation programs in different companies, I still believe Dr.
Deming’s idea that individual incentive systems create more
problems than they’re worth (if it were my company).

One company in the WSJ list, J.A. Frate Inc. selects one trucker to
be “Driver of the Year.” I think it’s clear Dr. Deming would say
“boo” to that, as that system only creates one winner, and many
losers.

Integral Project
Management Co.

Dr. Deming also preached that feedback to employees shouldn’t
come just once or twice a year. This company follows that
approach:

Many companies give employees feedback once a year in a
performance review. At Integrated Project Management Co., feedback
is a very frequent — and highly structured — process.

Each IPM employee sits down for
a weekly one-on-one meeting with his or her manager in which they
discuss work progress, the employee’s performance and the skills
that need improvement. Managers also regularly provide
employees with an “event summary” in which they evaluate how an
employee handled a specific task such as leading a company meeting
and provide concrete steps for improvement.

…

The reason for all this feedback, says founder and Chief
Executive C. Richard Panico, isn’t to intimidate or make employees
feel inadequate. It’s more like
coaching, given in a “very encouraging” manner, to help
employees get the skills they need and move up into leadership
roles, as well as to instill company values.

Dr. Deming always said “substitute leadership.” Sounds like IPM
does just that.

Landscape Forms
Inc.

Here’s a company that uses Lean-speak (or buzzwords) –
kaizen (continuous
improvement) and muda
(waste).

Today, the company still practices and teaches those principles
and has devised several of its own ways for employees to be
actively engaged in decisions that affect their immediate work. One
way: an employee-suggestion system dubbed “muda removas.” A play on a Japanese
term, it translates as “getting rid of waste.”

In this process, developed by Landscape management, employees
and their teams come up with ways to make their jobs more efficient
and effective. If the whole team
agrees on one employee’s idea, it can be implemented — without
approval from senior management.

I love that last part. A suggestion process doesn’t have to be
bureaucratic. And guess what? This will come as a shock to many
managers — you aren’t needed to approve every single change that
is proposed. You don’t have to let managers or upper management be
a bottleneck in the improvement process.

Landscape documents how many muda removas are
implemented and publishes them in its employee newsletter. So far
this year, the company has implemented more than 1,400. Many are
small changes, such as slightly altering the manufacturing process
in a way that makes assembly easier, but they can make a big
difference in one employee’s job satisfaction or
efficiency.

This is a method I use and teach — publishing (ideally on
bulletin boards) the improvements that staff members have made.
Simple before and after diagrams and illustrations showing the
impact of changes. This is a method that Norman Bodek talks about
every chance he gets — it’s the core of the Quick and Easy Kaizen
method (that you can read about in this book:
The Idea Generator: Quick and Easy Kaizen
).

“What happens in traditional
suggestion systems is you hand suggestions off to some group and
then they tend to pile up,” says Landscape President Bill Main.
When people don’t see their suggestions acted upon in a timely
manner, “they get discouraged.”

Landscape has also encouraged the use of its muda-remova
procedures to enlist employees to come up with cost-saving ideas in
their immediate areas that would save the company money, at a time
when it’s struggling to compete with companies moving manufacturing
overseas.

I can’t emphasize that point about suggestion boxes enough. When
they work, the review of ideas and suggestions is normally a pretty
“batchy” process — managers review the ideas and give them a
thumbs up or thumbs down (often finding excuses to say NO) on a
monthly basis (or less frequently. That’s a long lag time for
getting the good ideas approved and into action. At their worst,
the suggestions literally rot in the suggestion box. One hospital
laboratory I worked with had LOST (seriously… they lost it) the
key to the one suggestion box. Needless to say, they started using
a more visual approach that avoided boxes and batching altogether
– the method from David Mann’s outstanding book:
Creating a Lean Culture: Tools to Sustain Lean
Conversions

Did you see any other ideas you liked in the WSJ feature? Any
ideas in there that you would NOT consider to be part of an
outstanding work culture? What about your company? What are the
aspects of your culture that make it a great place to work (or
not)?