Most experts believe, a Lean enterprise program will only be effective with an undying willingness for it to succeed from top management, and most failures are caused by top management’s failure to drive a lean culture throughout the organization.  Oh it starts off great.  Management announces we are going to have a lean program, there may be a kick-off celebration, a lean committee is formed, and target areas are identified for lean initiatives.  So why does it sputter.  I say the problem is much more basic than lack of top management support.  It comes down to strategy or a lack of a strategic plan.  Every company is unique, has its unique problems, and a solution for one company may not be the best for another company.  What are the company’s financial objectives?  What are the company’s market objectives?  If the people who do the work in the organization don’t understand what these are, how can they be expected to make informed decisions and engage in lean initiatives that make a difference?

We at L&H are living through an example of this currently.  Our largest supplier developed a strategy that they had to increase capacity in order to meet customer demand, and that was more important than keeping prices low.  The organization has succeeded in reducing its lead times, through expansion, but we have seen unprecedented price increases even in these times with an uncertain economy.  The point is, the organization had a strategy, focused its resources at attaining the goal, achieved that goal, but at the expense of other market considerations.  Time will tell if that was a good strategy.

Where do your strategies come from?  They come from the people who will benefit from your products and services.  Notice I said will benefit.  You have your customers, and it is important to keep them happy, but how can get your competitors customers.  That’s what separates you from the competition.  Is it lead-time, price, quality, exceptional customer service, product features, engineered solutions, on-time delivery, time to market, or some combination?  Decide what you want to accomplish and run with it.

You can’t form these market strategies in a vacuum.  This is where the financial end of the business also must be considered.  What are your financial objectives?  These must be considered when forming your market strategies.  If your goal is to have the lowest price, you better have an exceptional cost reduction program in place.  If engineered solutions is your goal, you better be priced to cover the cost of a large engineering staff. 

Don’t make the strategic plan too complex.  Remember you only have limited resources to make things happen, and if you have too many objectives, the same objectives will be competing for the same resources, and you may not get the results you need.  Make sure objectives are measurable.  Don’t be alarmed if the measurements show poor results.  Remember this is a process improvement program, so the trend is the important thing.  Don’t expect instantaneous results.  Expect steady methodical and long lasting results.  Empower the people to make improvements.  Results will be long lasting if the people doing the job embrace the changes.  The goal is not to just meet business objectives, but to develop leaders as well.