Today’s episode #259 is Part 2 of a discussion I started with Steve Bera in episode #256. Steve was one of the original 16 “NUMMI Commandos” that General Motors sent to work with Toyota in the 1980s, as discussed in the outstanding book Comeback: The Fall & Rise of the American Automobile Industry.
In Part 1, we talked about his experience at NUMMI. Today, we talk about what happened after his two years at NUMMI, why he feared getting lost back in the regular old GM, what he’s done to teach and spread Lean in various industries over the past 30 years, and other thoughts on the current state of Lean.
A transcript of the discussion can be found at the bottom of the post. You can also read a summary I wrote of the two posts on LinkedIn.
Streaming Player (Run Time 38:35)
For a link to this episode, refer people to www.leanblog.org/259.
Topics covered in this episode:
- The book describes the confusion about the lack of a “repatriation plan” – what happened? To you? At GM? Why was it hard to spread lessons back into GM?
- What have you done since leaving GM?
- How do you see the “state of Lean/TPS” in America? How much progress are we making?
- Do you have any experience working with healthcare or seeing the opportunity for Lean as a patient?
- What’s the “risk” of a poorly executed Lean initiative?
For earlier episodes of my podcast, visit the main Podcast page, which includes information on how to subscribe via RSS, through Android apps, or via Apple iTunes. You can also subscribe and listen via Stitcher.
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Posts from my 2005 NUMMI Tour
Podcast Transcript – Part 2
Note: This transcript may contain errors… if you see a suspected error, please post a comment below and I’ll send you a coupon for a free copy of my e-Book of Lean Blog Podcast Transcripts. This transcript will be available for a limited time and will then become part of the eBook.
Mark: As NUMMI very quickly became a success story, and maybe you can summarize that a little bit, the book Comeback describes some of the confusion about the lack of a repatriation plan for yourself and the other NUMMI commandos. How would you describe what happened as two years in to the NUMMI experiment, for you?
Steve: For me, personally, and I can say this for all the rest of my partners who are the commandos, that we have gone through a change, each one of us. A change in the way we felt a business needed to be run, the relationship management with each other, the relationship management with the team members, the relationship management with the union, and with our key executives.
Again, Toyota became the model for us to try to emulate somewhere else in General Motors. The 16 of us would get together on a regular basis, usually once a month, to talk about what do we want to do with this experience when we finally have to go back into the corporation?
We were unanimous in our thinking that we all wanted to go back to one facility, whether that was one that needed change because it was not a strong performer, or a greenfield approach where we could build our own, and have our own culture based upon the values that Toyota had given us.
Roger Smith and Jim McDonald would come out on a regular basis, and we would sit in a room with them. Obviously, we would ask for a pulse check of how we were doing, and we were so emphatic and positive about the experience that we also asked the question, when we were ready to go back into the corporation, we wanted to be able to have an impact upon General Motors.
Unfortunately, for the time that I was there, we could never get a concurrence out of anybody, or any idea on what they wanted to do once our tours of duty were done. As time went on, that started to demoralize us, because we were worried about the fact that we were going to be sent back as individuals, as opposed to a team.
As my history showed, I didn’t finish my tour because I was concerned about what I had heard, that I didn’t want my next 20 years in General Motors to be like the first 20, if I was not given the opportunity to use the Toyota experience. At the same time, that was when I decided to go off in a different career direction.
Mark: What would you have anticipated, if you were sent somewhere as a Lean commando? What would’ve happened, do you think?
Steve: I think I would’ve been swallowed up by the local culture. I can tell you that not everyone had a chance to be a general manager in a facility. One of my very well respected team members out there, Larry Spiegel, he was able to be a general manager at one of the facilities, and he was a zealot on the whole Toyota system.
I believe that he was probably one of the few who were very successful in being able to implement a lot of those concepts within the corporation, and put him in the number one chair. He was the man, and I’ve always believed that it starts at the top. If it doesn’t start there, if it doesn’t cascade down, Larry, in his career, has always been the first one up front to talk about the value of that Toyota experience did for him.
Mark: As opposed to being sent in as the head of production control, you would have been swallowed up by the plant manager, and the superintendent, and all the prevailing ways of doing things, right?
Steve: That is correct. My experience, because I didn’t go back to General Motors after I left, but because I’ve been in so many corporations, both domestically and overseas, I’ve seen those companies that have been successful in implementing Lean.
Only because it may not be the CEO or the CFO, but the companies that I worked with, we had the endorsement and support of those chairs, but the mission was led by more the executive vice president, the senior vice president from the supply chain or the operations side.
Mark: If it’s OK, I want to take a quick detour, because you mentioned someone that I was very fortunate to work under, and learn a lot from, and that was Larry Spiegel.
He had two years at NUMMI, I had two years at General Motors, but my first year at GM, at an engine plant in Michigan, we had with a very traditional plant manager, management structure, but somebody at Powertrain headquarters had decided, “We’re going to hire people from these Japanese suppliers, and Nissan.”
We were sent this group of eight or nine people, into the Livonia engine plant. Maybe someone at Powertrain had thought that these were going to be some sort of commandos to come in and help change us, but I’ll tell you, that wasn’t just one person. That was a group of people. They were completely swallowed up by the existing culture.
They were quite literally exiled to these mezzanine offices that were the far corner of the factory, from the plant manager’s office. The message was clear, and in many different ways, they were not welcome there. The existing plant management, they didn’t know why they were there, they didn’t want them.
It was just frustrating, but then, after about a year, some fairly major quality problems, and productivity was terrible, too. Larry was brought in as the plant manager, the man at the top, and that just set things in a very different path for the people working there, and the future of that plant.
Like you said, he was, I think in a good way, a zealot about this new approach, and leading differently. The last thing, and I’ll stop reminiscing, was I traded emails with Larry a couple of years ago. He was teaching at the University of Michigan, and I asked him a question I had never been able to ask before.
Basically, that the plant superintendent, the number two who was still there when Larry was brought in was just the traditional yell, and scream, and blame, just old, I would say ogre of a manager. I asked Larry, “You seemed really patient with him. Why did you tolerate a lot of that behavior, and the way he kept acting?”
He said almost exactly the same way you said it just a few minutes ago. “When I went to NUMMI, I had the chance to go through a change, and he never had the benefit of that.” I thought that was really interesting. It made me a little bit more understanding or forgiving of why it was hard for the existing culture to change.
Larry really had a huge influence on me. It’s hard to understate. I’m curious, I’ve been babbling here, did you have any reactions to any of that?
Steve: I think that you’re spot on. It comes down to, because so many of our organizations have legacy practices, and we have people that have been around for many, many years. Maybe, in some cases, everything they’ve worked for has worked for them in the past.
All of a sudden, I think that we’re in a different world right now. Change is something that has to be more imminent as opposed to long-term planning. Years ago, people always asked the question, “What is your 5-year, 7-year, 10-year plan?”
Well, there’s no such thing as that anymore, because of the way that the business climate is, both domestically and overseas, the influences are so strong, you’ve got to be able to do something in the next 24 months, 36 months. Anything beyond that, you’re going to come in second, third, fourth. You’ve got to be able to change.
Now we have people who aren’t accustomed to change. Change is something that is the most difficult thing for all of us to go through. How do you do that? You’re right, without the NUMMI influence, without working with you, without working with Larry, how do you get that individual?
I think that’s where mentoring comes in, and coaching. I don’t know if that adage about you can’t teach an old dog new tricks. I don’t totally subscribe to that, to some people. There might be a percentage of those who will never change their habits or their spots and the way they manage, but I think those, as I talked about, humility.
As long as you can accept an open up your own kimono to understand what you’re all about, and where you have to change to go forward, you can change people. They need mentoring, and guidance.
Mark: I don’t know how much, I’m sure Larry was trying to coach that number too. I’m sure that was a big challenge for him. As you were saying, you chose to leave NUMMI, and to leave General Motors. What happened after that? I’m curious, if you can summarize for people what some of those next steps were, what sort of things you’re able to accomplish with that experience, having gone through that change with NUMMI.
Steve: For me, I was recruited out because, at that time, Toyota’s involvement and influence in this country was in embryonic stage of their history here. When I got recruited out, because I had now a newfound knowledge, and knew some new experience.
Maybe people thought we had the secret sauce. I think we probably did. We had something that no one else in this country did, and that was a reason to be successful, and the understanding that we could carry that torch and that banner. When I got recruited out, I was involved in consulting, and it was great to be able to go into companies that had never had an opportunity to talk about.
Of course, back then, 30 years ago, it wasn’t Lean, it was more just about TPS. Then we had to transition away from TPS because of all those people who were upset about Toyota coming into the country. We had to transition into the just-in-time world, world-class manufacturing, manufacturing excellence, and the one thing that Dr. Michael Hammer, who was instrumental in the BPR, business process reengineering.
Everyone coined the TPS environment as something new, but when you read the books, and you dissected it, for the most part, it’s all the same. The one thing you can’t do, it’s like any playbook. The playbook isn’t successful by itself. People have to pick it up, and run according to what the playbook is all about.
That’s the hardest part, getting the discipline and accountability to what the newfound disciplines are to run your business. That was my challenge in consulting, to try to change people, change companies, and the most gratifying one I had was when I worked three years with OfficeMax.
I was brought in, and I was the only consultant brought in. I was asked to help change the culture of OfficeMax. I spent three years, full-time with these guys, establishing an internal consulting group, and to this day, OfficeMax still has that same cadre of people.
I think some of them went on to other assignments, or left the company, but that same approach I had with Walgreens, I took to American Clip Company, I took to Walgreens. Those that want it, and have a thirst for it, and are willing to invest in it, it will change the way they run their business.
Mark: As you were saying, it starts at the top. Were you getting to work with people who were at the top, whether that was a plant manager, a division president, or a CEO?
Steve: Everywhere that I went, that was part of what my willingness to go in and help a company out was, to work with a vice president, is the one who would be the sponsor. There’s so many times that I was in the front of the senior vice president, executive vice president, the CEO, the president of the company, so they could hear and echo the same thoughts that I’m trying to expound upon through their organization.
I had to be sure, because they had to endorse it. They had to subscribe to it. Otherwise, people are going to, once again, feel like it’s another false start, and we couldn’t afford to have that.
Mark: As you worked in other industries, and especially you mentioned people in retailing, Walgreens, Office Depot you said?
Steve: I worked with American Clip Company. I worked with West End Company. I worked with Bissell, I worked with, of course Harley-Davidson is not retailing.
Mark: As you worked with these different areas, how much did people hate you with the whole, “We don’t build cars here,” as an objection? How do you work people past that, if they want to point out, “Harley’s different, and Walgreens, this is about health, it’s not about building cars”? What kind of discussions did you have like that?
Steve: That is an excellent point. Again, I had the fortunate career, being able to work in various industries, to carry out from one to another, not so much the product, but the challenges that I faced. Was it a management issue, was it a process problem, whatever it was.
The first question you ask when you’re going into any company is, what hurts? What are the pain points? What are you trying to resolve by having, whether it’s a consultant or internally, that your KPIs don’t measure up to what you’re trying to accomplish? I found that invariably, it could be customer service, it could be a quality issue.
It could be an absenteeism issue with people that then corresponded into other kinds of problems within the manufacturing sector, but you’re right. Walgreens doesn’t make a thing. Walgreens is a $72 billion company, and all they do is have warehouses all over the country, and their shelves are full of things.
The problem is that they were facing, “I can’t keep products on my shelf.” When I went throughout, because I had to establish a consultant team within Walgreens at each one of the DCs (Distribution Centers), and at the time we had like 32 of them. It was to train everybody within each one of the DCs.
Then I had a few people at the corporate office who would accompany me on each one of those trips, to where we would give the training, and every manager was involved in that. It was endorsed and supported by the general manager of each one of the DCs, so we never were lacking in terms of executive support.
We were never lacking in terms of team member involvement, because the thing that, again, you can’t just pontificate a success story. You have to be able to demonstrate through your improvement activities, whether you call it continuous improvement, or you call it just a reduction in quality issues.
The problem that we faced was it was a common thread that existed with everybody. It was the process was broken, and the process was being administered by people.
What we had to be able to do is to get some way to be able to administer the changing the process, and I didn’t do that. The Kaizen work was outstanding, because now you have people involved from every level in the organization to be able to identify as far as rank some of the biggest problems you have to try to solve them.
Mark: If you go back to books of Taiichi Ohno, he always said I think pretty clearly, “Start from need.” John Shook at the Lean Enterprise Institute talks about the need to identify, “What problem are we trying to solve?” That seems like a far more effective starting point than saying, “Well, we’re going to go implement these Lean methods,” because at some point who cares?
Steve: That’s exactly right. I’ve been in organizations where, when you walk out, you have all kind of collateral from the standpoint of signage and sayings. They’re all dressed up, but they’ve achieved nothing. The key is to be able to understand, “What am I trying to solve here to the involvement of everybody?” Then the key is the sustainability.
If I’m going to fix the problem, am I able to sustain it so there’s no repeatability to that same issue later on? That’s where you instill a cultural change to people that are cognizant of the fact that, “I’m not making the same kinds of mistakes I did before, and I’m coaching myself. I’m coaching those that are with me to be good at what we do.”
Mark: Different organizations out there struggle with these different aspects of Lean and TPS. It might be hard to generalize, but here we are in 2016. How would you describe the state of Lean or the state of TPS in the US? How much progress are we making? What are the big challenges out there?
Steve: I’m really still shocked over the fact that we’re having to face some of these challenges today in 2016 because the concepts, the books, all the conventions, the conferences, have been around for 25, 30 years.
When I first got to the GM building in 1979, we were already talking about some of the Japanese practices. I’m trying to understand how is it we haven’t been able to contemporize our practices? After 30 years we’re still saying, “Gee, what is some of the Lean stuff? I’ve never heard of that, what do I have to do?” it’s shocking that we don’t have leaders who try to embrace it.
Maybe they feel it’s a threat, maybe they feel it’s an investment, it doesn’t yield anything, because again they see it as more window dressing as opposed to an execution of a change in the process.
Mark: I think they probably do see it as a threat. The one challenge, and I think this is always a difficult discussion to have with people in health care when you talk about the need for culture change. Executives might at a high level talk, “Oh, yeah, we want to change the culture.”
How do you define the problem? What’s broken with the existing culture? People get far more uncomfortable with that discussion, and then I think there’s the recognition. Especially in health care, you have a lot of organizations where someone has been the CEO of that hospital for 20 or 25 years.
I think at some point they start to say, “Well, that reflects on me,” and they don’t want to talk about that. Let’s just go do some projects. Let’s train and certify more belts. That’s far less threatening than the reflection that comes with a discussion around how were we changing the way we manage.
Steve: It’s interesting because I think the health care industry has been one, particularly in the hospital side of the house. Of course you can see it, every one of us have experience in a doctor’s office about maybe some time management issues that don’t seem to be prevalent in their practice, but when I look at a hospital, and I’ve been in an emergency ward, and walk through the halls to see other people.
The one thing you have in a hospital is every person in that hospital, for the most part, is an independent business person.
This nurse has this patient or these three patients or whatever it might be. This person who does blood, this person does vital signs. In mass it’s almost impossible to measure the effectiveness of the hospital when everybody is an independent, so if you have a hospital that’s got 500 employees, and they’re all doing individual things, how do you assess the effect of that?
I think that’s the challenge in the health care industry, because again maybe the best thing in health care to see is, if I’m a nurse and you’re a patient, the best thing I can do is not have you need me. I have dwell time, so now as you and I have grown up with value-added versus non-value-added time.
Now how do you put that in perspective when you’re trying to measure the effectiveness, the utilization factor? I think there’s two things — efficiency and utilization. Those are two different things. In manufacturing it’s very easy to measure. In the hospital I find that very difficult, because utilization just means that I’m on the clock.
Of that time, if I’m eight hours on the clock, how much time am I actually doing effective work? That’s I think where the challenge is.
Mark: What you mention with the doctor’s office, and I [laughs] get faced with this, as a patient. I think what you describe as lack of time management. I think it’s more of just a fundamental assumption that goes back a really long time in health care that says, “It’s OK to make the patient wait” because the focus is on keeping the doctor 100 percent utilized.
It leads to poor flow. I think there are some organizations that through Lean in health care they’re discovering that that’s not right. It’s not respectful to the patient for us to always be behind schedule. We need to improve our processes, improve our flow, and focus on that sometimes more so than individual efficiency of individuals.
Steve: The one thing that I’ve never been asked in the medical profession is about customer satisfaction. If you’re going to multiple doctors’ offices, and I’ve been in there where I’ve seen 15 or 20 people sitting there in the waiting room, you’ll ask the question, “How are we doing on time? I’m here for my nine o’clock appointment and da-da-da. How are we running?”
“Well, we’re running about 45 minutes behind.” Ask me to fill out a customer survey [laughs] at that point in time,” but you specifically don’t get that because they’re going to say that’s the way their business is.
Mark: I know, and I blogged about this about a year ago. I’ve never been once asked to do a simple Plus-Delta at the end of an office visit. “What went well? What could have been better?” They never ask. I’ve complained to doctors’ offices where I’ve been a patient.
That just doesn’t really lead to anything constructive, but you talk about the independent functions. Hospitals are as siloed as anything in terms of functions and departments. Then you do have the unique complicating factor that more often than not the doctors are not employees of the hospital. They literally are paid based on different criteria.
That criteria doesn’t necessarily involve, and this is changing a little bit, how do we keep people out of the hospital instead of just treating them more efficiently once they’re there? We’ll start wrapping up a little bit here. I appreciate you being so generous with your time here.
Like you said, there are still people who are very new to Lean. What advice do you for them if they’re getting started?
Steve: There’s two pieces of it, which I think the most important is if I’m all of a sudden in a chair or given the responsibility to re-implement Lean, or if I’m somebody who’s on contract to go help them, the first thing that I think I need to do or anybody else does is to assess the organization’s what I call readiness for change.
Is there a culture within that organization that will be receptive to change? I think at that point in time you have to talk about the changes that have taken place historically within their organization whether it’s the organization’s structure, whether it’s personnel movements, whatever it might be, whatever those challenges that they’d faced in the past, that they’d been very effective at being able to manage.
Then it comes down to who was responsible for the success of the change process. You have to have that person who can carry that yard arm and lead that charge up the hill. I’ve always categorized as there’s only two types of leaders in the world. One is that charge up the hill, and one that leads the charge up the hill, organizations where somebody who’s going to lead that charge up the hill.
I think if you can look at the culture of readiness and the individual, you have an opportunity to be successful, but at that point in time, then you can start laying the plan in place to be able to say, “What are we going to do?”
The hard part is you can’t change an organization that’s got 1,000 or 10,000 people all at one time, whatever it might be. It’s like eating the elephant, one bite at a time. Where can you make the most impressionable impact upon an organization through change?
You do that through a well-executed plan, through something that has been endorsed and approved by everyone in the organization from the top down, and then slowly start to make that change, and use the success story as the one that will be the fodder for the next effort.
Mark: When you talk about leading that charge — I’m thinking back earlier, when you talked about not wanting to be the lone commando, thrown into one of the other GM factories. I’ve talked to a lot of people in health care who had great experience in manufacturing or maybe even at another, at this point, people who have experience with Lean in other health care organizations.
The get hired in as a director of continuous improvement. A lot of times, you’ll hear the term “lone wolf.” You think of the lone commando. They really struggle, because I think somehow their organizations have misunderstood. They think, “Well, if I hire that person, they’re going to make me Lean.”
It’s not like they’re more ordering the charge up the hill, and they’ve appointed somebody who, I think more often than not, not their fault as individuals. They’re not the right person. They’re not capable of leading that charge up the hill.
Steve: I think that the important thing, and you can attest to this as well as anybody, is if you’re going to stand up in front of a group of senior executives, mid-level executives, or even a group of team members, what image are you going to project at the first things that you say? Everybody’s going to look at us with a suspicion. It’s like, “What can you tell me or give me that I don’t already know?”
I think the important thing is to establish some credibility immediately when we come out of the gate, because you only get one chance to be successful at this. It has to be done with a lot of, I think, merit to what you bring to the organization and what changes. You’re also going to attest to the fact that you can’t do it alone.
You could have the best quarterback in the world, but if you’ve got 10 other guys that can’t do it, I don’t care. It’s not going to work, so you have to have a team, and, as I said before, you’re all going to play out of the same playbook.
Mark: Maybe as a final question here, we talked about there’s a lot of things that could go wrong. What’s the risk of a poorly executed Lean initiative? Is it that comment you made about, “You only get one chance to be successful at this”? Can you elaborate more on what those risks, or some examples of what you’ve seen as a poorly executed Lean initiative?
Steve: I think the risk, again, if you’re trying to mobilize, rally everyone around the flag, we have to be very careful that it’s not perceived to be another fashionable start, because once you have something the people believe in, and they subscribe to it, they’ll get behind it as long as the influence and the leadership, and the communication is done whereby people are seeing the change process.
The risk is if all of the sudden, it is not embraced and not led by others, people will all of the sudden just go back to, “I’m leaving my brains on the fence post outside. I’m coming in. I’m going to hit the clock at six in the morning. I’m leaving at three o’clock, and I can care less about what goes on with the business, as long as my job is protected.”
I think that’s that whole annuity thing I talked about before. You’re trying to build that esprit de corps, and I think that’s what a good Lean program does. It creates an esprit de corps that everybody will pontificate the fact that, “This is really good for us, and we’re doing very well. I’m comfortable about where my future is, and where this company’s going to be.”
Mark: What’s the most common failure mode to these different Lean initiatives that struggle? Is it a factor of not having the right leader, not having the readiness to change at the organization level?
Steve: I think an executable plan. Here again, we can publish anything we want. We can hang banners. We can do whatever we want, but there has to be something that holds the team, the individual, and the organization accountable for this path that we’re on, and it has to have the ability to be able to do a pulse check every step of the way, to be sure that we’re on target.
It is one of those things that I’ve always been comfortable with as far as being able to do the broadcasting, but I’m uncomfortable with the fact that too often it’s done as a publicity stunt, or it’s done something because it’s the flavor of the day.
Mark: There’s been a lot of that, whether it was TQM, Six Sigma, other methodologies. That’s a big challenge, and a lot of studies have been…People in health care, unfortunately, they put their guard up. They hear about something new. I’ve had people, quite literally, after a short period of time, where they start seeing the possibility with Lean, they’re excited about being able to make things run better, and they ask, “How do we know our leadership’s serious about it this time?”
“I can’t guarantee that, but you need to talk to them about that.”
Steve: Yeah. It’s interesting that everywhere I’ve gone, I’ve found those that are dressed to the T, and highly respected in every word that comes out of their mouth, but it’s more of an image as opposed to one who can demonstrate leadership.
I think that the leader has to be the one who has to have the visibility within the organization whether it’s the communication process through monthly sessions with the teams or in a podcast or in video tapes, anything.
The leader, no matter what level, has to be recognized as the one that he or she is behind this. It’s not something that’s arbitrary. It’s mandatory.
Mark: Steve, thank you so much for taking time to have a great discussion here, a two-part podcast. I really appreciate you sharing your experiences and reflections. Do you have any final thought that you might want to leave the listeners with?
Steve: The only thing that I would look at now is, and I am asking myself this question even today, if it’s not Lean what should it be? What’s next, or what’s in our tool kit?
It doesn’t matter whether you’re health care or manufacturing or high-tech, but what have you got in your tool kit that you can take out that’s going to ensure that you have optimized business performance in terms of operations, in terms of customer service, in terms of delivery, and customer satisfaction?
Mark: That’s a great question, because I think for those in health care who say Lean, [laughs] those who still want to make the argument, does not apply to health care, that’s a great question. What do they propose other than more of the same, more money, and things that we don’t have here in the US or in other countries? Great question. [laughs]
People listening to the podcast, probably a self-selecting group, believing that Lean is that way regardless of their setting, but I would love to hear from people if they know how others would maybe answer that question. Again, our guest here today has been Steve Bera. Thank you so much for being with us here today.
Steve: Thanks, Mark.