Katie Anderson Discusses Larry Culp’s AME Keynote and Their Fireside Chat
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My guest for Episode #464 of the Lean Blog Interviews Podcast is Katie Anderson, who is, among other things, the author of the book Learning to Lead, Leading to Learn.
She has previously been a guest here in Episodes 233, 275, 302, 326, and 425. Katie has also been a guest twice on “My Favorite Mistake” — once with Isao Yoshino and once on her own.
Today, Katie and I talk about the recent AME annual conference that was held in Dallas. We both heard Larry Culp, CEO of General Electric (and GE Aviation) speak for 15 minutes, and we discuss that here today. We also recap highlights from (and our reflections about) the fireside chat that Katie had with Larry on stage.
Notes and highlights:
- Listen to Katie on the internal GE podcast (named “Andon That Note”) she mentions in this episode
- Discussing the panel discussion that I moderated with Deondra Wardelle and Amy Gowder
- Gary Michel, another great CEO speaker at the event
- Larry: “This is how we manage” (Lean)
- Going to the gemba? Why? Process and people
- Top down and bottom up – operationalizing Hoshin Kanri
- Learning from mistakes, how a leader reacts to bad news
- From telling to asking questions – breaking the telling habit
- Having a coach as CEO… why Larry thinks that's so important
- Larry: “You don't go to HBS to learn how to ask questions”
The podcast is sponsored by Stiles Associates, now in their 30th year of business. They are the go-to Lean recruiting firm serving the manufacturing, private equity, and healthcare industries. Learn more.
This podcast is part of the #LeanCommunicators network.
Video of the Episode:
Photos from AME:
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Automated Transcript (Not Guaranteed to be Defect Free)
Welcome to the Lean Blog Podcast. Visit our website at www.leanblog.org. Now, here's your host, Mark Graban.
Mark Graban (13s):
Hi, it's Mark Graban. Welcome to episode 464 of the podcast. It's November 30th, 2022. Joining us today is Katie Anderson. I could be wrong, but I believe this is her sixth time here on the podcast. Today we are talking about the recent AME annual conference that was held in Dallas. We both heard Larry Culp, the CEO of GE and of GE Aviation. He, he talked for 15 minutes, and we'll share some highlights and thoughts about what he said on stage, but then we'll also talk about highlights and, and reflections from the fireside chat that Katie had with Larry on stage there at AME.
Mark Graban (54s):
So, you know, Larry Culp, formerly the CEO at Danaher, Danaher being probably considered by many to be the greatest American Lean success story because as, as Larry talks about, it's not just about lean manufacturing, this is about leadership. Larry says, this is how we manage. He talked about how he doesn't know any other way to lead, and, and that's what he's brought into General Electric in what's now been four years as CEO. So, hope you enjoy the conversation here. Hopefully for those of you who attended ame, virtually, hopefully the video of Larry's talk and the fireside will be available online.
Mark Graban (1m 37s):
I think they're still working on that, but hope you enjoy at least our, maybe next best if you, if you couldn't hear it directly, is Katie and I kind of recapping what we heard, what we learned, what we thought, and so here's the episode. Well, hi everybody. Welcome to the podcast. We're joined again today, returning guests, Katie Anderson. Katie, how are you?
Katie Anderson (2m 1s):
I'm great, Mark. Always fun to be back here talking with you and especially since we've recently seen each other in person.
Mark Graban (2m 8s):
That was great. We were, and that's what we're talking about today. We're gonna share some reflections and stories and in insights from the recent AME annual conference that was held in, in Dallas and late October, the Association for Manufacturing Excellence. So yeah, it was great to see you and, and so many other people, a lot of former podcast guests were, were there and it was great to reconnect them or meet them in person for the same time, actually, because of, you know, pandemic Zoom land that we've been in. I'm sure it's the same for you.
Katie Anderson (2m 38s):
A absolutely. I mean, I've, you and I have known each other for years, I mean, over a decade at this point. But great to meet some people who are new to my world in the last three years who I've actually gotten really close and connected with and just a really vibrant week of being in person with people. So it was, it was great.
Mark Graban (2m 58s):
It was. And so, you know, the main thing that we're gonna talk about and and, and reflect on and share some ideas was based on, I, I thought this was an amazing opportunity. The final keynote speaker was Larry Culp, the CEO of ge. He's been CEO now for four years. He had been CEO previously at Danaher. Great lean and business success story that, that was, so Larry gave about 15 minutes of remarks, and then Katie had an opportunity to moderate Q&A with Larry. Tell, tell us a little bit about how that was. Yeah,
Katie Anderson (3m 36s):
It was super exciting. So this, this came to be that Larry had read my book over the summer and we can talk about how that emerged. I actually hadn't heard the story of how that had happened until we were on stage together, and I knew he was going to be the keynote speaker closing the event. And two weeks before the event, they asked, you know, would I help moderate a fireside chat with him? He wanna do a shorter keynote and then have some discussion. And of course I said yes. And, and that was that. So it was really exciting to have a chance to not only meet him, but really dive into a discussion with him about a leader who is truly leading the way with lean thinking and practice Yeah.
Katie Anderson (4m 20s):
At an executive level. Yeah.
Mark Graban (4m 21s):
Yeah. Yeah. And I, I was really excited to hear him speak for the first time. You know, I've, I've, I've read, you know, it's funny, Danaher is a very private company and in recent years there's been a couple articles, one from the Wall Street Journal that did actually take a pretty good dive into what Larry is trying to do as he frames it. His words a lean transformation Yeah. At ge. And so, you know, I guess I would say I've been a fan for, you know, it was good to actually hear more from him in person. He had a lot of great things to say.
Katie Anderson (4m 52s):
Absolutely. There were in, in preparation for the discussion, I had listened to two podcasts that he'd been on in the last two years. And I was super excited after hearing him speak and on these podcasts. So excited now to dive into our reflections of, of the session as well.
Mark Graban (5m 12s):
And then as it, as it turned out, you know, Larry's session kind of followed different opportunity I had to help moderate some things.
Katie Anderson (5m 22s):
Absolutely. So it was, I think it was a really nice setup of the day on that last day of the AME conference. So Mark was moderating a conversation with Deondra Wardell and Amy Gowder, who also is an exec at GE and also has a special connection to Mark. Mark. How do you know Amy?
Mark Graban (5m 44s):
Well, Amy and I just had her 21st wedding at anniversary. Right, yeah. After ameAME And as you mentioned, Amy Gowder, she goes by her maiden name professionally. We, we decided it, there was really no need to disclose that on stage. You know, it's funny, they had formed the panel. It was gonna be, you know, Amy, Deondra, who's been a guest on the podcast and become a dear friend of, of mine and ours. And then a third panel is Sarah Boisvert, who was a guest on the podcast before she ended up not being able to make it because of some positive things happening with the nonprofit she's involved in. So it became Amy and Deondra. And it's funny, they had formed the panel and then Amy had approached me.
Mark Graban (6m 27s):
So if anything, I got the gig. You know, I don't know if it was because of Amy, but she wasn't on the panel because of me in terms of like that conflict of interest, the kind of kind of disclosure. But, you know, there was that opportunity to, to, to ask them questions as as leaders and, you know, to, to hear what they had to say. The theme of the conference was about embracing disruption. So we were really talking about different dimensions of cultural Yes. Disruption. And it was really, it was fun to be able to explore that with them. So I, it's funny, like I'm in, I'm in the fog of like trying to moderate and keep things going and I don't have notes to go off of. I need to go back and listen to the recording, but you had some notes, thankfully, Katie.
Katie Anderson (7m 10s):
I do. And I was tweeting during the day too, with some great things that had come out of it. And, you know, some of the key themes about what both Amy and Deondra were focusing on was our sense of humanity and being human beings as leaders and showing that you care and that it's about both as a leader. And Amy talked about this, like being clear on where we need to go, but then really showing that you care and support people as well. And Deandre made this great comment that, you know, people don't care care how much you know, until they know how much you care. And I thought that was, that was pretty powerful as well. And I loved hearing then, so Amy's perspective as a senior leader at GE and how that was really connected and how she's showing up as a leader of going out to see, going to Gemba, making sure that she's checking on both process and on people.
Katie Anderson (8m 4s):
And then connected with what Larry Culp also said on stage about how his perspective on leadership and how he really wants his leadership team of which Amy's a part of to be spreading and connecting these leadership principles in service of achieving the business outcomes they need.
Mark Graban (8m 21s):
Yeah, yeah. And you know, Amy has worked reported to Larry for six months. You know, she's new to GE Aviation or it's becoming GE Aerospace. So she originally got the invitation to be part of the panel when she was in a different role with a different company. So then as it worked out, okay, well we end up with two GE executives, you know, Amy running a business unit, and then Larry running, you know, CEO of GE, but then he's also recently become GE Aerospace CEO as GE prepares to spin off the other two businesses. Larry is, you know, clearly staying with aerospace. So you, I you're right, you could hear in those comments where, you know, she's, she's been, you know, influenced by him in, in that short time even.
Katie Anderson (9m 7s):
Yeah. And you know, it was, it was great to hear two senior leaders as well talk about this. Because a lot of times at these types of conferences, we have a lot of mid-level to senior mid-level leaders and continuous improvement leaders trying to really lead the change. But to hear from two of like the top executives and companies talking about how they see this style of leadership as being the, like, the way to actually achieve what they need for their business was really powerful. And actually, before I went on stage with Larry, he made the same comment to me about how more senior executives and like the C-suite really need to hear these messages and to not just sort of keep delegating all of this down in the organization without really taking it on for themselves as well.
Katie Anderson (10m 0s):
And that message came through in the mess in what he said as well when we were on stage together.
Mark Graban (10m 5s):
Yeah. So it's, it's quite possible the next generation of lean CEOs are being developed at GE these days under Larry. And it's gonna be really interesting to see, you know, how, how that evolves. I was also gonna give a shout out to another CEO speaker the day before Gary Michel, who we, we, we had a chance to talk. He's, he's agreed to come on the podcast at some point because he was also sharing a very consistent message about, it's not just about the financials and the business results, but humanizing. I don't think that lean needs humanized, but there's always that risk of it being dehumanized of, of just focusing on process numbers, data results.
Mark Graban (10m 49s):
Gary started his keynote by showing a picture and telling a story about a frontline team member. Yes. Lot CEOs don't do that. They wanna talk about themselves and you know, I think neither Gary or Larry were at all making it about them, which I also couldn't help noticing and admiring.
Katie Anderson (11m 8s):
Yes. So the, the level of humility and generosity that came forward and how they talked was really, really incredible. And, you know, just the generosity of sharing the time and the energy and, and, and the reflections and sharing, you know, some of the challenges as well that they've had personally. And the learning, the learning curve, they've had to do something different and in a different way. And I, and I really reflect too, you know, this concept of go show you care and be human is such a message that comes out in all my conversations with Toyota leader Asino in my book, learning to lead, leading to Learn. It's the secret is about learning and learning is about caring about people and helping, you know them also be part of the solution and the learning process.
Mark Graban (11m 58s):
Yeah. And, and the swinging of generosity. I'm bring it back to your book again. Learning to lead, leading to learn. See, I said it correctly that time you
Katie Anderson (12m 6s):
Mark Graban (12m 6s):
Have it, I always stumble. But learning to lead, leading to learn, not to get cocky about that. As soon as I get cocky about it, I'm gonna get tripped up again. But Larry, Larry was very generous in his praise for the book and you know, as you'd mentioned, he had heard, or at least heard part of your appearance on an internal GE podcast. And I know that's now available for people to listen to on your website and we'll link to it in the notes. But he, he said something like, you know, those were the two best sentences about host Cony. What was the exact word he
Katie Anderson (12m 43s):
Used? So I, I was just actually looking through the transcript of the, the sessions I hadn't had much time to kind of reflect. So this was a good prompt for me to do some reflection too. And he said it was the two most coherent sentences on Hoshin Kanri that he'd ever heard. So I need to go back to that podcast and actually try and find those really coherent sentences that I said. So it was this internal GE podcast, which now I have available on my website. So that's great if you can link to that. And I love the podcast name if you're aficionado it's called and on that note, so play on words of and on being the chord you pull when you have a problem, but also and on.
Katie Anderson (13m 23s):
And I hadn't heard that story. And so what Larry's was started to tell me before we went up on stage and he is like, oh no, I'm gonna save it and I'm gonna tell that story when we're on stage together. So it turned out he had heard the podcast and then it was right before he went on summer vacation. And so he asked his team to get my book and he put it in his beach bag and read it on vacation. And I actually, I think it was in September, I got a bunch of pings from people working at GE saying, Larry just sent out an all hands email saying he came back from vacation and read your book and highly recommended it and the podcast that you had for all GE employees to really understand what Lean is all about.
Katie Anderson (14m 3s):
And so, I mean, I was thrilled at that. And then to be invited to have the conversation with him, and then when he put a big slide on the, during his keynote with my book and, you know, good to Great in a few other seminal leadership books was amazing.
Mark Graban (14m 18s):
I I was just pulling up the picture. Yeah, good to great. The Machine that Changed the World, A book by basketball coach Dean Smith, the Carolina Way, Top Grading, which I'm not real familiar with. And then a book Principles by Ray Dalio. And then there's a stack of your books in the picture. Yeah, I'll share that picture in the show notes for the episode.
Katie Anderson (14m 41s):
That was pretty, pretty amazing. And you,
Mark Graban (14m 45s):
You should do a second edition and and of the book and get a word from Larry.
Katie Anderson (14m 49s):
Absolutely. Absolutely. That will, that will, that at some point will be forthcoming. You know, I was, I didn't wanna spend the whole, you know, I only wanna ask him one question about my book cuz it wasn't about me on, on the stage. I also really appreciated him saying that, you know, this was my intention as a writer, that it was a very accessible book to read and to understand how lean applies not just in manufacturing, but across all different areas and that it's really a leadership journey. And that was why I wanted to show Mr. Yo's journey of truly learning to lead and leading to learn. Because we all have to make changes for ourselves to become a more effective leader and a coach to create learning in our organizations.
Katie Anderson (15m 33s):
And, you know, it, it, a lean transformation is truly about an individual transformation or individual growth. And then collectively how we kind of pull that together. And that's the, you know, culmination is the culture. Yeah.
Mark Graban (15m 49s):
And so, we'll we can dive more into that. And as you mentioned, and Larry said these exact words that at GE, Lean is not just manufacturing. And so I think, you know, the first thing we're gonna dive into a little bit here was his comment thinking first back to Danaher. And now under his leadership at ge, he used the phrase, this is how we manage. And that's a different way of articulating this than talking about, well, we're doing all these tools and we're doing this many events. He's really emphasizing culture and the way leaders are are leading. I'm, I'm, I'm curious to hear what some of your takeaways were on that.
Katie Anderson (16m 30s):
Absolutely. I mean, he, he talked about the power of like a Kaizen event and he, he talked about different tools, but again, it's not about the tools, it's about how we're using the tools. So leadership, behavior, mindset and actions. And you know, he also said, you know, looking, looking at this too, that you, you can't, you need leaders to really walk the walk and these are some quotes from him and that the senior team really has to be bought into this. So this is not something you can delegate. And that's something he specifically said. So, and this is, I would say leaders at all levels. It's not that just the executive can't delegate it, the executive cannot delegate it if it's gonna be successful, but we all have to be applying, applying this.
Katie Anderson (17m 16s):
And, you know, one of the first things he said, and this I think really critical and it just gets back to your podcast of which we are both holding up some t mugs for my favorite mistake, but with this concept of, of bad news and bad news first and being, and making it acceptable to have problems and bad news as a key management mindset. And then how you respond to that as the action. And he said, you know, bad news in most organizations typically does not travel fast. And then later he went on to say, and in his experience, when it doesn't travel, it can be fatal.
Katie Anderson (17m 56s):
And so if we have this culture where we don't even look at problems, then you know, we aren't really gonna be able to solve the problems. And so one of the biggest leadership shifts that has to be welcoming and embracing bad news first.
Mark Graban (18m 12s):
Yeah. So I, I liked how he emphasized that the moments of truth, as you put it, how do leaders deal with bad news? You know, he said, I want to hear bad news, I want to hear it fast. And you know, he talked about moments of truth of having to prove himself. People at ge of saying, Hm. Well, in the past people have been, you know, they were shooting the messenger and that Larry had to prove to them that he could react constructively to bad news to help, you know, you could use the phrase psychological safety to make it safe for people to report the truth, bad news or all, and, and to react in a way that's constructive of asking questions and seeking to understand instead of yelling and screaming or blaming.
Katie Anderson (18m 57s):
Right. I mean, this goes back to the same story that Mr. Yoshino shared on the first time we were guests on your podcast. My favorite mistake about the now famous paint mistake that he made and how his, when a hundred cars at Toyota had to be repainted instead, not they, not only they not yell at him or blame him, they looked at the process and then collectively looked at how they could make a better improvement for the future and actually thanked him. Cause it was an op that bad news was an opportunity to see improvement. And so how do we, it, you know, all of us, I mean, I think at the human level hold ourselves back. I mean, I think of myself as a parent sometimes too, hold ourselves back from like, ugh.
Katie Anderson (19m 37s):
But looking at the process and how do we make improvements on that? And that fosters learning Yes. Improvement and innovation.
Mark Graban (19m 45s):
Yeah. And you know, I, I wanna come back to the, a little bit more about the how they manage. But another thing I had in my notes, and thank you for asking him, you know, that question about learning from mistakes, you know, Larry said you need to acknowledge mistakes and you need to own the mistakes and then you need to get better. Like that's the spirit of the My Favorite Mistake podcast and, and, and the book I'm writing around all that. And I'll hold up… thank you for the daruma. You're welcome. I'm using one of Katie's daruma with the one I filled in.
Katie Anderson (20m 14s):
Mark Graban (20m 14s):
Great. Because the book is still very much a work in, in progress. But you know, I I I appreciate that you, that you asked them about that and I think hearing a leader and, and, and not just hearing them say it like back to how they manage Larry emphasize, you can't just talk the talk, you've gotta follow through with the right actions and demonstrating to people that I'm not gonna shoot you for bringing me bad news that flows downhill in a very positive way where the opposite gets really dysfunctional really quickly. We've heard stories from all, all sorts of corporations, Ford Motor Company, when Alan Mulally came in the famous story about like, yeah, how are all the status of everything, how can the status of everything be green when we're literally in the red losing money?
Mark Graban (20m 59s):
Cause people were afraid to report the truth and he had to change that culture there at Ford.
Katie Anderson (21m 4s):
Yeah, right. It's like, it's, it's where Larry started off the conversation and it really is, you know, psychological safety is what we, how we talk about it now, but that is fundamental to being able to be successful and to move beyond the tools, but to this really being the way that we manage and that we grow, improve and achieve the important business goals that our, you know, each organization needs to do to, you know, survive and thrive.
Mark Graban (21m 34s):
Yeah. And so Larry had learned this way of, of leading and you know, he, he was relying on paraphrasing, but a story of when he came into GE, somebody had asked, well, are you going to lead the Danaher business system way? And he is not gonna call it Danaher Business System, GE of course. But he said something to the effect of, well, you know, I don't know any other way, You know, and I thought that was an interesting reflection and, and comparing, you know, he talked about how, as you mentioned Katie, you know, that fully committed senior team, well, you know, Larry became CEO at Danaher in 2001, which is the same year Jack Welch retired.
Mark Graban (22m 14s):
Right. You know, Larry's path had not crossed with GE yet, but Larry had time to build that culture. And he said, I'm sure by the time he left that the senior executives had all come up through that culture. Yeah. Now he's coming in to lead GE where executives have not come up through that culture. I'm sure that that creates new leadership challenges to, to recognize that situation.
Katie Anderson (22m 35s):
Yep, yep. For sure. And you know, but he had, he did have to change the way he was showing up as a leader. And so he even made that comment, I asked, one of my first questions was asking about what were some personal leadership changes he needed to make and you know, he made the comment, well I didn't go to Harvard Business School to learn to ask questions, you know, you learn to like get, be intuitive about giving the answer. And so he had to actually unlearn that instinct of wanting to come in and being the problem solver, being the expert with the answer and to, to ask better questions and to listen and to listen more thoroughly and effectively as well.
Katie Anderson (23m 16s):
And he realized that that's, that was the huge leadership shift that he had to make. And so now he's quite effective at that. But that, I can imagine that there was a, a growth curve and he even mentioned that, you know, it kind of felt awkward in the beginning and now he realizes cuz he's gone through that himself, that it, it feels awkward for the leaders who report to him or are working for him to like move from this leader who has all the answers and is supposed to be the expert to now I'm the leader who is, is asking more questions, setting the challenge, but helping enable people. Yeah.
Mark Graban (23m 50s):
And he did, Larry did comment on that saying, you know, GE leaders had generally grown up through the organization expecting to get answers from their leaders, not questions. Yeah. And, and, and Larry went back to, I think it was his first P&L role within Danaher, which he added a pretty young age. He said something I, I thought, I think this is a pretty direct quote that he needed. It was humility for survival because he didn't know the answers. Right. And he couldn't, as he put it, bark out commands. He had to go on this discovery journey as, as he called it. And so it was really interesting to hear that reflection and, and you know, if he were here it would be great to ask him so that, you know, the the the shift in his leadership style of leaving Danaher where he feels like, you know, the culture is there now into a place where the culture is something to build.
Mark Graban (24m 44s):
I'm sure he's had to adjust his approach. It'd be interesting to think about how you would change your approach if you were
Katie Anderson (24m 50s):
Mark Graban (24m 51s):
Kinda making that shift.
Katie Anderson (24m 52s):
Yeah, absolutely. Well and I would, I, I think, and I imagine he's doing this, is sharing the why and the purpose behind his actions. And I always suggest to leaders who are starting to make this shift, and it's different in their organizations when we're, as we're doing what I call break the telling habit, and we're making that shift from being the expert with all the answers to more of a leader as coach, tell people what you're doing and why label it. Like say, I, I'm asking more questions because I want, I don't actually know the answer or I don't have context for this. I wanna hear how you're thinking about this and, and explaining the why can be so helpful for, for people. And he's been so transparent even on stage with us that I imagine that he is saying those things to people explaining that context.
Katie Anderson (25m 40s):
Cuz it, it helps people understand why and stop like making assumptions of why, you know, he has, he has mal intent. No, no, no. He's, he's actually wanting to be helpful.
Mark Graban (25m 49s):
Yeah. And, and, and, and part of that why as he articulated it on stage there, and this goes back to an acronym I learned in the auto industry 25 plus years ago. And it sticks with me and I think it translates well into other settings. S Q D C, safety, quality delivery cost, like that order is very intentional of emphasizing safety, emphasizing respect for the employees. Like I loved when Larry was telling me a story about when the Shingujitsu sensei, yeah. They're doing kaizen events with GE, within GE and told the story or about the sensei leading a round of applause for the frontline workers and like a sincere showing appreciation, you know, sort of way.
Mark Graban (26m 40s):
And you know, and Larry sharing how that influence is a positive one of seeing how much the Shing jisu people really deeply respect the frontline workers.
Katie Anderson (26m 49s):
Yes. They're the people who create the value, who really, you know, leaders are actually there in service of helping them do the work and do it better, safer. Yeah. You know, that, that connects to the concept we were talking about too, about going why, why you go to Gemba as a leader, go to Gemba being the word in Japanese for the place the work happens. And I asked Larry, you know, when he goes to see the front line or goes to see an organ, one of his organizations, you know, what is he looking for and what's his purpose? And he said, you know, two things I'm going to see, you know, the, actually I wrote this down, the status of the state of the lean transformations and also the process and then the state of leadership and, and how people are doing with these core principles.
Katie Anderson (27m 40s):
So how are they, how are they doing? And you're, so you're going at two levels to check on process and to check on people. And so often we just focus on that process side. We have to bring the people side into that as well. So that, that goes back to what we talked about at the beginning and what Amy and Deondra were talking about too is that sense of humanity and caring as leaders as well. So it's not just the outcome and the process, it's the, it's the people.
Mark Graban (28m 5s):
So I mean we can find in a lot of different ways, maybe two sides of the same coin. Like we, we care about results, but we're looking at process cuz that drives better results. Larry talked about daily management. He, he made some sort of comment about, well now people are actually realizing they need to look at hourly management to better win the day, you know, if you will. And all these dynamics of like for example, he mentioned both top-down and bottom-up. So for all of the, the talk about kaizen events, you know, he also talked about daily management and engaging people in improvement. And then I think part of that top down, bottom up then comes back to Hoan cony or strategy deployment.
Mark Graban (28m 50s):
And he talked about, you know, operationalizing Hoshin Kanri like what, what, what were some of your notes or reflections about the way he talked about that?
Katie Anderson (29m 1s):
Right. So, you know, he talked a lot about Hoshin Kanri sort of strategy deployment and how important it is. And I, and I talked to him a little bit as well before we had the conversation on stage that, you know, one of the challenges and what was appealing to him about the concept of Ocean is really how do you break down silos and the cross functional management of a large complex organization. Of course you're gonna have so many different functions, but you have different products, services, delivery. And so on stage, when we talked about this, he said, you know, ho and cony is also a way when you operationalize it and by operationalize it, I, my sense is from how we talked about it, it's like how do you put it into practice?
Katie Anderson (29m 45s):
So it's not just this concept or this, you know, he, he says they use the X matrix as a tool at ge, but like how does that not just become something that's slapped up on the wall, but how do you use it to break down silos through conversation, through shared alignment on priorities and so much more. But it's really about the conversations, right? So it's not just going through the motions, but how do we stay in alignment and talking across the system?
Mark Graban (30m 11s):
And, and I think that came through also in a couple different ways. One, you know, back to this word operationalize, he also used the phrase that Hoshin Kanri helps you operationalize your ambition, right? So it's one thing to have goals or ambitions or, you know, instead of just demanding breakthrough improvements that randomly pop up, you can be kind of systematic through an X matrix or other methods. So figuring out what, what do we need to accomplish? What gaps are we choosing to focus on? What initiatives are we connecting, you know, makes my head spin, like quite literally as you turning your head, and it's probably better to turn the paper than to turn your head Yeah. Yes. But you know, like operationalizing not just deploying goals, but having those conversations and those cycles of, you know, I think this is a really powerful message where it's not about just having the goal and executing the plan, but it's not about these cycles of, of discussion or catch ball, whatever you might call it, of, you know, you talk about, well sometimes we overestimate what we could accomplish and sometimes we underestimate and you, and you adjust.
Mark Graban (31m 15s):
It's not a huge mistake, it's an opportunity to adjust. Right.
Katie Anderson (31m 20s):
Well, right. It absolutely. And you know, one of my favorite phrases from Mr. Yoshino and is you have to have seemingly impossible targets. So that's the challenge, right? You know, we talk about this in the healthcare space, like the challenge should be like zero errors, zero defects. We may not know how to get there, but like it's seemingly impossible, but we need to move towards that. And so ho can help if you're doing it right and we're like failing along the way or having some successes, then we can learn, accelerate or adjust throughout there. And you know, I I'm guessing too that some of what he, when we talked about enjoying Hoshin Kanri and, and my book, it's really talking about those fundamentals and, and also how Toyota learned that it was about leaders behaviors in doing ocean, about having discussions across different functions, about really understanding the top priority and also then how they were going to help their teams achieve it.
Katie Anderson (32m 21s):
And so my sense is from all that Larry is talking about, that's what he's trying to create at, at GE as well.
Mark Graban (32m 27s):
And when, when he was talking about all of that, he made me think of a CEO now of a previous generation, Paul O'Neill, when he was at Alcoa because he set what some might called the big hairy audacious goal of, you know, zero harm. That nobody who comes to work at Alcoa should ever be hurt Yeah. At work and then evolved to you. You should actually go home healthier than you arrived, right? So there's that goal, but it's, it's not a slogan or cheerleading, then you've gotta do the work, you've gotta lead the effort to help people become better problem solvers and, and you know, to, to make sign significant progress.
Mark Graban (33m 11s):
And it seems like that same thing, you know, exists there. It's not just, I'm sure Mr. Y would, would, would, would agree if you were on the line with this, it's not just about the goal, but then what do you do to work toward it? Like what other detail would you fill in about that?
Katie Anderson (33m 26s):
Well, right. And also how do you have a structure to check and adjust? So, you know, you, you can't just like do something on the annual cycle or just check on the process, but how are you having those routine discussions, conversations, reflections, and as we know, the learning happens and the reflection and, and in the adjustment as well. And it's okay. And, and having, you know, this goes back to what we talked about bad news first. It's okay that if we're off track of achieving our goal, all right, so what are we going, what are we gonna do? What are we gonna do on that? Yeah. Yeah. It's
Mark Graban (34m 2s):
Interesting. One of
Katie Anderson (34m 2s):
Mark Graban (34m 3s):
Go ahead. I was just say one quick point on that. You know, you talking about not just doing the rote check, like did you implement this or not? I, I forget if Larry was talking about back at Danaher or if this was at GE, but in my notes he said something about somebody says like, we've done 17 kaizen events and he said something to the effect of like, okay, well which one of those had impact? Right? It's not, it's not about, it's not just about doing the things. Yes. But what are, what, what are we achieving compared to our prediction and how do we adjust if we're not getting impact that we wanted?
Katie Anderson (34m 36s):
Right? And, and I made this comment at the end of the discussion with Larry too is we don't, you don't do lean just to do lean. You're actually, it's in service of achieving important business outcomes or if you're, you know, showing up this way, whatever you, you, you're to achieve some important challenges and then how are you gonna get there? And so it's, it's connected to both the outcome that you need and the process by which you're gonna get there. And that includes the learning process as well. So you have to, you have to build that, that learning process. Sure.
Mark Graban (35m 10s):
And then, you know, we're looking at results and again, just picking from the notes here of how Larry emphasized the workforce and culture and you know, the connection of, you know, these, these shop floor kaizen events. One element of culture he touched on, I thought was interesting. He said, it's telling how executives react to the invitation to come to a shop floor. I'm sure he's evaluating and thinking, Hmm, they don't seem very interested in this or they're making excuses of why they can't do it. And so he said, you know, culturally, well, you know, why send an executive to a Weeklong Kaizen event?
Mark Graban (35m 50s):
He said it's the, in his opinion, I think he said it's the best way to internalize these lean principles. Not just hearing about them but doing things. But then he talked about the culture impact on the workforce of one, one of the union representatives. He used the word raving that they were raving about the effect on culture, like in a positive way. Like my GM days, if you used the word raving, they were raving mad about something. And, and I'm not blaming the union for being mad, GM management did a lot of stupid things back then, but like the positive effect on, on on the culture in addition to business results, it's two, it's back to two sides of the same coin again.
Katie Anderson (36m 30s):
Absolutely. I mean, I think about my early learnings as a lean practitioner back when I was working in hospitals and healthcare systems exclusively as an internal lean consultant and like the power of a Kaizen event that week-long kaizen event. It's, it's magical. And to go through that experience, not just by being the leader that's coming in and hearing the report out, but by going through that journey is so transformative and the energy it creates is so powerful. And so it was really exciting to hear Larry talk about how he believes in that as an important part of a leader's learning journey of not just achieving the business outcomes, but about their own understanding of what this is like.
Katie Anderson (37m 15s):
And he even said, you don't know what a Wednesday night, I think it was the Wednesday night, you know, events like until you've gone through it Yeah. Where you're like, oh my God, I don't know how we're gonna do this. It's not possible. And then you get to Friday and it's like amazing. So I mean that's what actually sparked my absolute passion for this type of approach to leadership. The continuous improvement to operational excellence is because it is just, it is magical. You know, I was looking through my notes too when we were talking here and you know, I, the, something that stands out to me is his comment that you have to go slow to go fast. And so like the, I reflect on the how this sort of pervasive impatience that most leaders and organizations have and they want it to happen now.
Katie Anderson (38m 7s):
And it's hard because we do need business outcomes now, but the, the time it takes to really make changes to behavior and to culture does take a long time, is you have to go slow to go fast. And I think that that's a real, a challenge for a lot of of places and why lean efforts fails cuz they really didn't achieve the results that they wanted within six months. And so yeah, that doesn't work.
Mark Graban (38m 34s):
He, I think that's the first time I've ever heard that phrase from a non Toyota person or, or, I mean, I guess I've heard it from people who've been influenced by Toyota and you see that lineage of Toyota Shingujitsu to Larry this phrase go slow to go fast of, you know, I think of a change management course I went through where they talked about, I think this comes back to John Kotter and his change model of like, you can force a lot of change really quickly, but it might be fake improvement where it's not really how often people say, oh, we haven't sustained our change, we haven't sustained our improvement.
Mark Graban (39m 14s):
I don't know if it was really ever deeply implemented
Katie Anderson (39m 16s):
Right. Or right or we didn't have the management capabilities to really sustain and continuously improve. You know, I always think back to the story of Toyota's own leadership development program called Co Pro that I talk about in learning to lead, leading to learn. And they decided to, you know, Mr as was part of the internal group creating this leadership development program, and his boss said, well, we can't have just one year because one year is too short because it's too easy to fake it and three years is too long because, you know, it gets a little exhausting, but two years is enough time where you really have to be trying and changing and it'll probably sustain at that point.
Katie Anderson (39m 59s):
But, you know, most of our, you know, we're like, oh, three months, six months, that's fine. You should be self-sufficient. But really no.
Mark Graban (40m 7s):
Well, I mean, I think you asked Larry, he made a comment about, so like when you've been CEO for years, I'm trying to remember if this was in a side conversation or on stage, but you know, he said it in a public forum, so I think that's okay. You know, he's been CEO for years now. How long has this culture change take Now I I do recall him on stage saying something about, well, you know, COVID slowed us down a little bits dealing with all of that. But I, I remember saying, well like next year, like 2023, that should be the year where it really starts to take root and click.
Katie Anderson (40m 47s):
Hmm. And I'm, it'll be different levels across the system just because that's the nature of it. You talked about, and this is connected to making behavior change stick is the power and importance of having a coach and how even as he is the CEO of this huge company and he has a coach, not just an executive coach, but a lean coach who has been with him for a long time, who helps him continue to practice and learn and be more effective in leading this way. And I really appreciated him talking about how he has a coach and that we all need, we all need coaches, right?
Katie Anderson (41m 27s):
So because we have our blind spots and he, he said, you know, it's a great outside perspective for, you know him when they're not making enough progress. So what does he need to do as a leader to help enable that? Or if he's not really listening as effectively or seeing sides of things that he needs to do. So we, we all have these opportunities. So it was it was great to hear about
Mark Graban (41m 47s):
That. Yeah, I mean I think it does set a good example and he, he, he talked about that outside perspective or the trusted sensei or advisor. You need some people who can tell you when you've screwed up. And again, if you're in a culture where bad news isn't flowing up the chain Yeah. And you haven't yet created a culture like sure the ideal would be a culture of psychological safety where people aren't afraid to, to challenge the boss. And you know, if you're still building that in different ways, like having that, that outside perspective to keep you grounded, to keep you humble. He, he talked about that a lot, you know, leading with humility.
Mark Graban (42m 28s):
Hmm. And I'm gonna just, this is my supposition here. I mean, can you, or my question like can you imagine those words, I don't wanna get sidetracked on the difference, but like, I can't imagine Jack Welch ever saying that phrase out loud unless he was mocking it maybe, right? That was just not his style leading with humility. What?
Katie Anderson (42m 48s):
Well they, you know, it's so interesting that they, you know, two different CEOs of the same company with pretty different leadership approaches and perspectives as well. And it'll be really interesting to see how Larry and leading with lean as his leadership style is gonna be able to really make GE survive, thrive and like achieve all of the big, big goals it needs to into the, into the future and, and what we've learned from the differences of those different leadership approaches too. Yeah. I actually gave, yeah, sorry. Well
Mark Graban (43m 22s):
I was gonna say first, I mean he is the first outsider ever hired as CEO, which puts you in a unique position to help change the culture without being an inadvertent defender of the culture that you created. I think there's certain things only an outsider can help shake up in an organization,
Katie Anderson (43m 40s):
Right? And, and to, to see things that become invisible when you have been habituated to them as the norm. And so that's one of a leader's role is how do you make the invisible visible? And so he has a opportunity to help others see the impact of, of, you know, leadership styles or what's been happening in the past. And he also talked about in his talk and he, and in other podcasts, I listen to how there are so many amazing people at GE and that's why he's so excited to be there is, you know, it's now it's just helping them see a different system and structure to help enable their success for realizing the impact that the, and the, the potential that the company and the people have.
Katie Anderson (44m 28s):
So it's, you know, there's a lot of greatness there. And so it's basically how do you cultivate that and create the systems and structures that allow it to survive and thrive and allow people to contribute again, their ideas and their thinking. You know, he mentioned, I think it was on a different podcast how he like out of the woodwork came all of these great lean thinkers and practitioners who are like, I'm here, I'm here. And he's like, let's use you. So, yeah, yeah, yeah.
Mark Graban (44m 52s):
But you know, one, one other thing I had in the notes here about culture I think was interesting and it's made me think of the other day, I had a chance to interview the CEO of the hospital for special surgery in New York, Lou Shapiro. And he, he was, he was very interesting. He, I mean, you know, he would point to culture at his, you know, special specialty hospital and he, he brought up the phrase, you know, a lot of people like to say culture eats strategy for lunch. He says, I don't believe that He said culture is strategy.
Katie Anderson (45m 27s):
Mark Graban (45m 28s):
And I think Larry touched on that a little bit differently. There was a story that had kind of a surprise ending. He, he talked about back in the Danaher days, cuz Danaher bought a lot of companies and would apply the Danaher business system model to it. And he said there was one organization they were looking to buy and somebody there made a comment, this is the quote, we no longer talk about bad news here because it's deemed bad for morale. Yeah. So part of me, and maybe I'm just thinking from a, I know I'm looking at it from a different lens of like runaway, like I wouldn't wanna work there. His lens was that's a company that we can turn around. Like if you have good technology and you have other strengths, you can change culture and like easier so than done.
Mark Graban (46m 11s):
But you can do it. And I think especially, you know, in the Danaher days, if the leaders couldn't come around, Danaher could bring in talent from other businesses Right. To turn it around
Katie Anderson (46m 23s):
And, and great, well if they haven't been making the problems visible, well once we start making them, we have an opportunity to change and make everything even better. So I can see how it's like, okay, we can do something with this. You know, it's true. It's like you can change culture. The the NUMMI experience, the joint venture between Toyota and GM is such a incredible example about that as well is like if leaders change their behavior to bad news, to challenges, to providing that support to really pull in the, and on going back to the, and on when the and on court is pulled showing that the frontline worker has a problem, the leader, the manager's coming to provide help.
Katie Anderson (47m 3s):
Wow. That really makes a big difference. And that was like a huge powerful shift. And you know, everyone you can, the new me results are so well known. So same thing with GE. And I think that's where Larry sees all, you know, sounded like he's very excited because of the, the people and the process and the potential at GE. So I'm really excited to see what he's gonna do. I gave him actually a daruma slightly, slightly bigger than the one I've given you. Sorry, Mark. Another time, I'll give you a bigger
Mark Graban (47m 33s):
One. I was in, I was in an event where you had a lot of small darumas that you gave away. I take no offense, it's right. Yeah.
Katie Anderson (47m 38s):
Yeah. So I gave Larry one this size a little bit smaller than some of my biggest ones, but you know, to, because he has some big business goals and so hopefully the daruma will be able to help him remember that it's okay to have setbacks and challenges fall down seven times, get up eight, but keep going forward to the, to achieve the goal. And I'm really excited to see not only the outcomes of this organization, but also the process and the learnings that happen. And with all the transparency and you know, they've had about their journey, I imagine we'll have opportunities to learn from, from and with them as well.
Mark Graban (48m 13s):
Yeah. So to steal their joke from their podcast. And on that note, do we have any, like, before we wrap up here, like maybe this is sort of grab bag of like was there anything else in the notes that you think was noteworthy? One, one note that I had back to the idea of having a coach, you know, Larry said that, you know, that his son stays such a great example and for other leaders. And then I thought this was key and this shows the humility and Larry said it helps him see how far he still has to go, which I think is a powerful thing to be willing to say in front of others.
Katie Anderson (48m 49s):
Yes. Yes. And I, I guess building on that, I asked him, cause we were talking about the concept of how he was talking with his, the leaders who report to him that it may feel awkward and, and I said, well how do you handle feeling awkward? And he's like, oh, he made a joke of, of course I don't feel awkward anymore. But, you know, but he, he's willing to show that he, he, he does. And it's always a learning journey and this is why you have a coach to help continue to challenge you to an even better you and provide that support. And that's where that learning zone is. And that's why we all need coaches and leaders as coaches in our world as well. So really shifting, shifting that as well.
Katie Anderson (49m 30s):
Yeah. And I, I think for me it was just really going back to Larry Culp was reinforcing the essence of what makes lean really successful. And it's about having clarity on the challenge or where you need to go that direction as I talk about how do you as a leader provide the support to enable your people to learn their way forward. And then how do you develop yourself as a leader too? And to have that humility to know it's okay not to have the answers. And you always need to make some changes too. And I just remembered one thing, I was taking a note while you were talking and you mentioned that Danaher Business System, and I think it's really interesting that they shifted, they originally called it the Danaher Production System, and so it was really focused on manufacturing and the processes, but they actually changed it to focus on this is the way we manage and lead.
Katie Anderson (50m 25s):
And that's how Larry's focusing on here. I work with some clients who are like trying to create their own production system, but in we're also talking about yes, that's great for looking at how you're improving processes, but then what's your leadership system along with that to enable it? Because it, you can do all you want with the production system, but if you don't have the management and leadership capabilities and system to support that, you'll, you'll end up going back to just tools and projects.
Mark Graban (50m 52s):
Yeah. And, and I think when it comes to, you know, business improvement, production improvement, you know, Larry emphasized, the other thing I was gonna pull out from my notes here is, you know, so what you won't read about maybe out in the media is what's happening daily in the factories, right? This is, this is not just about talking differently. And another quote I wrote down or paraphrase was, you know, we need leaders who don't just mouth the words and don't just hire consultants. It's about working differently, not just talking differently. And, you know, he, he said, we want to aim for better results and have, he used the phrase Tru lean culture and then he asked me, you know, how how do you change the culture?
Mark Graban (51m 35s):
You change the way you work.
Katie Anderson (51m 37s):
Mark Graban (51m 37s):
So I think again, it's two sides of the same coin. Even, you know, I think back to models that go back to dating myself, TQM, days of, of learn do. Right. You know, the, the, these are very intertwined, sort of like, you know, talking different, acting different, working differently, leading differently. It, it's, it's all intertwined.
Katie Anderson (52m 0s):
Absolutely. And you know, we, we focus so much on, oh, we need to create this culture. And again, culture is just the accumulation of the acceptable and standard norms of behavior and action. And it's not, we can't just change our mindset. If we change our actions first, then it helps shift the mindset. So it's actions, actions, actions, not just talking it, but walking it. And again, Larry's clearly a leader who, who's doing that. So super exciting and it was such a thrill to be able to not only meet him in person, but have that chance to be on stage and talk one on one with him. And of course here, here how he's leading and thrilled to hear what he had to say about learning to lead, leading to learn.
Mark Graban (52m 41s):
Yeah. Yeah. I was happy for you. I'm happy for others who are going to be exposed to, to the book. And I think the, the, the final thing I was, I gonna share from the notes here, and again this is kind of grab bag here, but there were so many great nuggets,
Katie Anderson (52m 58s):
Mark Graban (52m 59s):
Goodness, a lot of great things being said. One, going back to our discussion earlier about going to the gemba and seeing what's really happening. He, he said, you know, he realizes going to the gemba might be an unrepresented sample, but it's all I've got. Yes. And an incomplete picture is better than a PowerPoint deck. Like I wanna get
Katie Anderson (53m 20s):
Yes. I love that's a, that's a great quote, right? Going to see something is better just staying in your conference room and relying on synthesized secondhand information and you can't make all your decisions on that, but it gives you a pulse of where things are. Yeah. Of things where things are really,
Mark Graban (53m 37s):
Yeah. And then a final thing I'll add here, you know, back to the idea of doing the work, being lean and leading, lean, not just implementing lean. And, and he emphasized the difference there of implementing lean versus being lean. And then, then he asks a question, how many companies want the Danaher stock price multiple without putting in the work? So that was interesting. I don't know the answer to that, but there are some, you know, and that's kind of a sour note to end on. I think the positive side of it is, again, like you, you can't just talk about this to your workers. You can't just talk about it to Wall Street.
Mark Graban (54m 17s):
You gotta do the work and it seems like they're doing the work.
Katie Anderson (54m 20s):
Absolutely. And you know, this goes back to go slow to go fast. Know that you have to change as well and lead the way. And that's gonna feel awkward at times. Have a coach who helps you and to, to know that it can't be delegated. I, you know, it was very clear that you ha you have to, has to be led from the top. And even if your company isn't there yet, you're, you know, the people. This is more now for our listeners here, like you're growing into those senior leadership roles and you'll have opportunities. So how do you cultivate this type of leadership within your sphere of influence and this current role, or this current company? But then, you know, it's gonna change and there's gonna be more, more ahas along the way.
Katie Anderson (55m 3s):
So we just have to keep, keep going and keep, keep our eye on, as Amy said, the true north and keep learning our way forward.
Mark Graban (55m 12s):
Well, that's a good note to end it on there. So I'll remind everybody, you know, the show notes here for this episode are gonna be pretty rich. There will be links to things including Katie's book, leading Learning to Lead, leading to Learn. See, I knew I would get as soon as I get, that's
Katie Anderson (55m 28s):
Alright. But you know, it's a cycle. You have to lead to learn, learn to lead all of the same, just keep going and around in the shade of
Mark Graban (55m 35s):
Learning. I, I jinxed myself in, in, in, again, stumbling over the title my fault, my mistake but the, the internal GE podcast episode that Amy mentioned, there's a lot of great photos like the photo of you giving the Jerma to Larry and, and him holding your book. We can put some of those photos in the, in the show notes and a link to the episode for My Favorite Mistake with Katie and Mr. Yoshino. People wanna follow up on that.
Katie Anderson (56m 3s):
Yes. And great. And I talked about in the same way that Larry had to start making a shift asking more questions. My favorite mistake from back then was learning how to do the same. So, yeah. Well, thank you Mark. It was so wonderful to hang out for four days in person and really, and to finally meet Amy as well and to spend some time together and I look forward to more time together in the coming year and also more conversations and reflections like this here together.
Mark Graban (56m 34s):
Yeah. And I'm glad we could hang out for about an hour-ish here. Yeah. You know, hearing our retelling of all the great stuff that was shared, you know, hopefully provide some value if people don't get a chance. I hope people do get a chance to hear some of this directly from Larry in other venues in the future.
Katie Anderson (56m 52s):
Yep. AB absolutely. And I think this also speaks to how one of the challenges we often find is having time to reflect. And sometimes the best way to reflect is to have a deadline and to have a reflect reflection, buddy. So Mark, thank you for being my reflection buddy and for having this on the calendar because this gave me the space and time, or I created the space and time to reflect on it and I enjoyed the, the discussion as well. Yeah.
Mark Graban (57m 20s):
That's the way to put it. Creating the space and a little bit into how the sausage is made, sometimes delaying the start of an episode, 30 minutes gives you that time to Yeah. Do a quick run through of
Katie Anderson (57m 31s):
No, it was great. Well, I'm sure there'll be more reflections in nuggets to have from, from this the AME Dallas event and also this, this discussion with Larry Culp and more. And I look forward to hearing what people think and hear and reflect on after hearing this podcast discussion with you and me.
Mark Graban (57m 53s):
Yeah. And if people want to connect with, with you, Katie, the website is kbjanderson.com and I'll, I'll put that in the show notes as well.
Katie Anderson (58m 1s):
Yeah, correct. And same as my Twitter handle and you can find me on LinkedIn in the same way. And my YouTube channel now has that handled too. So all is aligned.
Mark Graban (58m 11s):
We'll see if Twitter is still working by the time.
Katie Anderson (58m 13s):
Yeah. Yeah. I mean like, you know. But for now, for now,
Mark Graban (58m 19s):
Katie, thanks again.
Katie Anderson (58m 20s):
Thank you. Thanks Mark.
Mark Graban (58m 21s):
Well thanks again Katie, for being our guest yet again here. Always enjoy it and I'm sure she'll be back. You can find links and more in the show notes or go to leanblog.org/464.
Announcer (58m 38s):
Thanks for listening. This has been the Lean Blog podcast For lean news and commentary Updated daily, visit www.leanblog.org. And if you have questions or comments about this email Mark at lean\firstname.lastname@example.org.
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