George Saiz on “We Started With Respect” and His Career Focused on Improvement

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My guest for Episode #481 of the Lean Blog Interviews Podcast is George Saiz.

As a coach, writer, and speaker, George Saiz actively promotes enterprise excellence through a people-centric culture to the next generation of leaders. 

In his new business novel, We Started with Respect, he shares from his executive experience in the medical device industry and the many best-practices sites he visited as president and CEO of the Association for Manufacturing Excellence. He is retired and currently resides with his wife in Carlsbad, California.

Questions, Notes, and Highlights:

  • What's your Lean origin story?
  • The Goal — a business novel
  • The leader going first with the learning??
  • Compliance vs Commitment 
  • Using Lean as business problem solving vs. tools for operations?
  • Exposure then to Lean / TPS?
  • The need to focus on process AND people (culture)
  • What aspects of Lean don't work without a high enough level of mutual trust?
  • Gallup surveys show that two out of three employees are disengaged to some degree –causes or root causes?
  • Examples of companies that invest well in supervisor and manager training?
  • The need to DESIGN culture?
  • Tim Clark's podcast, “Culture by Design
  • Tearing down the walls — starts with executive leadership team
  • Looking back — key Influences and mentors?

The podcast is sponsored by Stiles Associates, now in its 30th year of business. They are the go-to Lean recruiting firm serving the manufacturing, private equity, and healthcare industries. Learn more.

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Automated Transcript (Not Guaranteed to be Defect Free)

Announcer (1s):
Welcome to the Lean Blog Podcast, visit our website at www.Leanblog.org. Now, here's your host, Mark Graban.

Mark Graban (12s):
Hi, it's Mark Graban Welcome to episode 481 of the podcast. It's July 26th, 2023. My guest today is George Saiz. You'll learn more about him in a minute. For more information about George and his new book, it's titled We Started With Respect. It's available now. Go to leanblog.org/481 or look in the show notes. As always Thanks for listening. hi everybody, welcome to Lean Blog Interviews. I'm Mark Graban. Our guest today is George Saiz. He is a coach, a writer, and a speaker. He actively promotes enterprise excellence through a people-centric culture to the next generation of leaders.

Mark Graban (52s):
He's the author recently released of a business novel called We Started With Respect. So in that book, and we're gonna talk about it today, he shares from his extensive executive experience in the medical device industry and what he's learned from a lot of best practices sites when he, that he visited when he was president, and CEO of AME, the Association for Manufacturing Excellence, an organization I'm sure listeners and viewers know of. So George is now retired, currently resides with his wife in Carlsbad, California. So George, welcome to the podcast, How. are you

George Saiz (1m 27s):
Good? Thanks, Mark. Happy to be here.

Mark Graban (1m 30s):
I am jealous, I'm sure of not to get too sidetracked on this so California weather in, in July. I'm, I'm sure. I I hope it's, it's a glorious time of year, right?

George Saiz (1m 42s):
It's, it is finally nice. I have to tell you that I know the, the country's gone through some climate change and it's actually been cold here the entire year since December. And So, I've had to wear long pants out to golf and had golf cause of rain. Yeah. So, but I have to say since since July came, we've finally gotten some nice 72, 73 degree days and, and clear skies. So it's a beautiful day at the beach.

Mark Graban (2m 8s):
Yeah. You're probably not gonna garner. I'm not a golfer, so it doesn't bother me. You're not gonna garner much sympathy having, having to wear long pants for the, the winter golf. But, you know, I spent two years closer to Los Angeles along the coast. And I. I, I, there's, I do miss that weather, especially summertime in other parts of the country now.

George Saiz (2m 28s):
Right, right. Absolutely.

Mark Graban (2m 30s):
Okay, but this is not the Weather podcast, sorry. But we are gonna talk about George's new book again. It's called, we Started With Respect, but we start generally here on the podcast. I like to ask people their origin stories. So, you know, everyone's got a unique story of, of where they first got exposed to Lean or tps or however it was being framed at the time. What's your Lean origin story?

George Saiz (2m 56s):
Oh, well, this a fun one. I, I had just become a new general manager of a, of a very small division that was in, it was in Dire Straits. It, it had been the, the market leader and had a dominant market share and very profitable and, and hit, had lost a lot of that. And so as I came in, it was time to transform the entire business. And And I was looking at where to start. And fortunately for me, another one of our divisions had gotten involved with Lean and they were teaching a seminar. This was within a, a Bristol Meyer Squibb companies. And they were teaching a seminar called The Goal.

George Saiz (3m 37s):
It was based on the book by Eli Goldratt. And So I was invited to come to that and, and take the, take the course and So I read the book. And it made absolutely no sense to me. You know, the lot size of wine. I thought, no, doesn't make sense, doesn't fly. You know, that doesn't, you know, I dunno, that's gonna solve anything, but I'll go down there. It was in North Carolina, And I, okay, I'll go down there, And, I'll see what they got to say. But it didn't make sense to me. And so the first half of the day was, you know, discussion and going through the book principles and everything, and it, you know, it still wasn't really doing much for me. But then the second half of the day was the Lego Block simulation, and oh my gosh, all the lights went on.

George Saiz (4m 22s):
And it, it just really, then it made sense to me, obviously. And so when I left there, I asked the, the guy that was instructing, I said, would you give me all the materials? I'd like to take my entire company through this course. And So I went back to back here to California. I was leading a California based division. And And I actually then went through some training. And I took all the employees. And I was the one that led the, the, the, the exercise So. we had about 12 employees each time. And we just went through our entire company, which was fun for me to get to know everybody. I was new in the company and we were in a turnaround situation, but it was a great experience.

George Saiz (5m 6s):
And it was the same thing that we all went through was Yeah, yeah, yeah, yeah, yeah. Then you do the legal blocks. Oh my gosh. And so it was a fantastic time for us. I, I'll tell you just a, a snippet, cause I know all of you guys have been through the same kinds of things. But as an example, when we started our Lean implementation, we would pull a work order, release a work order, pull the parts, you know, take it down through assembly, inspect it, package it, put it into finished goods. And the average time was about two to three weeks from start to finish for release to, to put it into finished goods. And when we finished, we were doing that in two hours.

George Saiz (5m 46s):
And So, you can imagine all the things that had to happen to get to that point, but it was just a fun time and, and, and fun turnaround for the company as well. So after that I was completely sold. And, and you know, it, it's just a, this is just a wonderful process.

Mark Graban (6m 4s):
Yeah. Yeah. I mean there's, the one thing that stands out to me in your telling of that story is the power of a leader going first in terms of the learning of, you know, how often does an organization get the benefit of whether it's in the context of Lean or whatever, of the general manager, c e o business unit lead going and getting the training and, and coming back and say, okay, I'm gonna not just send everyone else to it, but I'm gonna teach it. Like, it doesn't seem like that happens very often. I mean, I'm applauding you for it.

George Saiz (6m 41s):
Well, thank you. And, and And I think it's a big difference maker too, because I would see so often in companies that, that I would tour that have implemented Lean that, you know, so often it gets relegated to operations and, and the leader, the, the senior leader, the executive doesn't see it as a company-wide exercise and process. They say, well, that that's something you can do out there in, in operations. And So, I think that was an advantage for me. And then when I kept growing in my career and getting, you know, larger responsibilities in, in bigger companies, then we are always looking at our Lean implementation as, you know, enterprisewide always.

George Saiz (7m 21s):
And, and that's a huge advantage. Cause it does apply throughout our, our business.

Mark Graban (7m 27s):
Yeah. Yeah. I mean, I think there's a difference. I mean, thinking about different pathways that people could go through with Lean, a lot of organizations say, okay, well here's a list of tools that we're going to go and implement. Versus coming at it from the direction of Like. what business problem are we trying to solve? How are we applying Lean concepts or problem solving methods to those challenges? Is it a throughput challenge, a quality challenge, a safety challenge, a cost and profitability challenge? Are, are there ways where you've been able to influence business leaders to, to look at Lean from more of that perspective of business benefit as opposed to operations activity?

George Saiz (8m 12s):
Well, I think when you are able to, to share that every, as well, you can find in most aspects of your business a process. So whether you're doing accounting or you're doing sales or you're doing r and d, you still have a process. And, and if you can explain how we can break down and apply this to the process, then I think it opens their eyes to see that it is applicable throughout the company. And certainly, you know, we go back, And, I know this kind of ties in, certainly to the book, but for Toyota, at the heart of this was always respect And I think that when we do tie into the cultural aspect, And I think leaders see the benefit and can understand.

George Saiz (8m 52s):
And again, I'll say that, you know, if we treat our folks with respect, we have the chance of getting what I would call commitment. And if we don't treat them with respect, then we get, you know, maybe compliance or, or blind obedience. But it's a huge difference and it's a huge difference in the, the operating results as well.

Mark Graban (9m 14s):
So I'm gonna ask a question. A friend of mine, I'm not gonna name names or location or industry, but a friend who, who may end up listening to this episode had shared with me about conversations within his organization. There was an assessment done, and there was, I think around safety and the assessment said, well, there's a compliance-based culture, which was like, kind of low in the spectrum of where it could be. And my friend who's, you know, a longtime Lean practitioner is having to have conversations, you know, and kind of challenging people who, if I remember right, he said like, they thought compliance was fine. They thought, oh, compliance.

Mark Graban (9m 54s):
Oh, good. So to somebody or an executive, you know, how, how would you kind of try to explain the difference between compliance in other words, like commitment and like why, why is that a necessary progression to get beyond just compliance?

George Saiz (10m 13s):
Sure. Well, I think if you just envision what that means, what the word means, compliance is, I, I'm gonna do what's required of me. And that's okay, that's good. But commitment also implies that I'm not gonna do what's required of him. I'm gonna take it a step further. And if I need to take that extra step, if somebody needs some extra help, you know, it, it, I don't need to just do it and walk away and say, well, that's good enough and hope it works out. I'm not gonna walk away until I know it's gonna work out until I know it's, it's good because I care and I'm committed, you know, to the folks that are committed to me as well. So, I think, you know, it is just, you know, sometimes folks don't want to invest in this area, what we call the relational part of business, or maybe sometimes call the soft stuff.

George Saiz (10m 59s):
But really the, you know, if you look at some of the, the, the results, it's phenomenal. The operating results of companies that do focus on engagement and on commitment and on respect and trust, you know, it's, it's, it's light years.

Mark Graban (11m 17s):
And, I, I don't know if there's anyone that would ever claim that compliance is the path to world-class performance or manufacturing excellence. Like a m e is not a, you know, or, or Shingo Institute. They're not, they're not giving awards for like, the most compliant companies.

George Saiz (11m 35s):
Right.

Mark Graban (11m 35s):
Just on the surface it sounds kind of silly, right?

George Saiz (11m 38s):
It does, it does. Well, you know, in terms of like a regulatory environment, you know, are you compliant to the regulatory, you know, we all tend to, you know, like we say, the taxes, you don't try and do better than, than the IRS requires, you know, you just do, you're compliant. Sure. You know, kinda same thing in my world. We were in via medical device, you know, we weren't trying to get an A plus with the fda, but we were trying to make sure we were compliant. So there might be some areas where that applies, but you know, in terms of performance and attitude, it, I'll take commitment any day over compliance. Yeah,

Mark Graban (12m 11s):
Yeah. Or yeah, it's, I think it's in addition to, in, in that, in that spectrum or progression that compliance is fine, but not sufficient, you know, necessary but not sufficient, perhaps.

George Saiz (12m 22s):
Yeah, yeah. You definitely wanna build upon that.

Mark Graban (12m 24s):
So you, you, you talked about, you know, this exposure to, you know, the goal Ellie Gold Rat's book was, was this like early to mid nineties, just guessing of when the goal

George Saiz (12m 35s):
Was It was most popular. It was 19, 19 91.

Mark Graban (12m 39s):

  1. Yeah.

George Saiz (12m 41s):
And actually that book heavily influenced the book that I wrote is fact, it's why I wrote this book in a novel form, right? I had read business books. And I would tend to read the first five or six chapters and think, I think I got the gist of it. And I wouldn't finish it. And, and this one just kept my attention because I got involved with the characters, And I wanted to see what happened. And, and also the novel provided me the opportunity to, to give it to my wife to read And. I was, this was my first time in a leadership role as far as at a divisional level, and it was a turnaround situation. So she was able to understand a lot of the things that I was going through without just getting bombarded with a bunch of business terms.

George Saiz (13m 21s):
So I thought that if I ever wrote a book, I'd wanna write it as a, a business novel, which had some complexities, but it was the influence from the goal that that started that.

Mark Graban (13m 31s):
Yeah. Yeah. It kinda spawned a whole genre of business novels. I don't know if the goal was the first, I think it was definitely the most popular or the first popular one in that format.

George Saiz (13m 43s):
Right, right. Well, goldmine after that I think was, was very good. And, and Patrick Lencioni's book, the The Five Dysfunctions of A Team is, is also, you know, written as a business. F

Mark Graban (13m 56s):
Yeah, yeah. So The Goldmine, Michael Ballet, And I, think Pascal Dennis has a couple of business novel format

George Saiz (14m 4s):
Right. Books

Mark Graban (14m 5s):
As well. So, we, we'll, we'll come back and, and talk about the book in a second. Again, we're joined George Saiz. The book is, we started with respect, I started with weather in this conversation again. Sorry. But what I was gonna come back to was, when, when did you get exposed to, let's say, something framed as Lean or t p s and sort of combining, or layering, I assume it was more combining it with what was learned from Theory of Constraints instead of replacing,

George Saiz (14m 35s):
Right, right. It was, it was further down in, in my career after that, when I got to work for a another company that was definitely steeped in Lean and very involved. In fact, it was the group that introduced me to ame, and they had won several awards and, you know, a lot of folks that, that had been steeped in it for quite some time. And, and that's when it kinda transferred over from the, the things we learned through Gold Rat to, to more of the, the TPS based system and approach. Yeah.

Mark Graban (15m 9s):
Yeah. And you know, there's, I haven't seen a lot of this in a while, but, you know, I can't think of how much time has been spent, people debating online on LinkedIn or Blog comments of like, you know, Lean versus Theory of Constraints. Like there's a lot of time invested into that. You know, I'd rather think through, like when I was at General Motors 1995 starting my career, they brought in, I think it was literally Gold Rat, gold Rat's, Consulting group. And we read the book and there was kind of, you know, kind of a cheesy video version. Did you,

George Saiz (15m 42s):
I think I've seen that

Mark Graban (15m 43s):
Dramatization of the book, and they had, they, they were doing like a computer based, you know, simulation. But I remember, you know, there was a lot to be learned there. And then GM was starting to be influenced by Toyota People slash Lean, however we were gonna label that. I mean, I think there's, there's few, there's very few parts of it that come into conflict, really. I don't think we should be debating this versus that. What are we learning from the, from from each of them? What, what, what would you say if, if somebody were trying to start that debate, which I'm not trying to start here.

George Saiz (16m 19s):
Well, I think that that TPS really layered on the tools in the, the culture aspect on top of this. And, and so it, it, you know, in my mind it was more of progression. So I learned more about how to do it and what tools to use to accomplish that. And, you know, So I think that was, that was what made a, a difference for me. And certainly in, in, in the implementations after that were quite different because we were much more tool-based.

Mark Graban (16m 51s):
Yeah. And, and, and the thing that comes to mind now that we're kind of thinking about this, I mean, you know, the, I think if I'm remembering right, for what it's worth, the theory of constraints, people would say like, you know, your first operation should be your bottleneck, because then you can't be building up whip through the flow. And like some TPS purists, which I'm not always sure what that phrase means. Or like, well, you shouldn't have a bottleneck. You should have a bottle, a balanced operation. And, I, like, the world's complicated. We're doing, we'll figure things out and we'll see if we can really hold, you know, be a purist. I don't know what that gets us So we can, we can learn something from all these methodologies, I think.

George Saiz (17m 34s):
Right. Well for me it started with Herbie and then just kept going from there.

Mark Graban (17m 40s):
So the book we started with respect, does that title, is that born directly from one of the Lean transformations that you were a part of where it did, like, literally, am I taking the title too literally, or what was the inspiration for the title?

George Saiz (17m 57s):
Well, the inspiration I think really was the, the focus on, on culture and that, and people, and that I just am a, a big proponent that if you start there, it should start with respect and And I. And one thing that I was noticing when I was at AME and getting to go see all these companies in the, in the last several years, if you remember back, if you take back, you know, 15 years ago and folks were starting their Lean implementation, the first thing they were starting with was either 5s or they were starting with a, they set up a cell, you know, middle manufacturing, try and get some kind of a success story going and building. But even though they did that, a lot of times, you know, folks are, are resistance to change and So, you know, that would be localized to a success there.

George Saiz (18m 47s):
But there'd be a lot of battlegrounds going on about, well, we're not gonna change. We're not gonna, they're not gonna force me to do that. And, and So I just felt like that, that the culture was, was, was, is is that starting point? It, it's, it's not the, and, and I'm seeing that that companies and that, that it was touring, getting back to that, that they were starting with a focus on culture Yeah. For a couple of years before they would go into their Lean implementation. And so instead of starting with the tools and starting with that resistance to change, they're starting with culture and they're building, you know, starting with respect, they're building trust, and then they're talking about the tools and the folks then they trust management and they trust each other.

George Saiz (19m 30s):
And those tools then can go in much, you know, there's a lot less resistance to change at that point. So sorry for my little brain spasm there, but, but it, it, it was, you know, I, I just saw that really changing and And I thought that that is what made sense to me. And if I could go back and change how we did things at the implement, some of the implementations I was involved in, we would've started with that to begin with. And so it's, it's, so that's, that's end up being why the, the book was that way. Cause I thought that was the most important thing at this point to start with. I think that you'll get a much deeper and much more sustainable Lean implementation if you start Yeah. With that first.

Mark Graban (20m 11s):
Yeah. And, and a lot of times people will frame things as an or so again, like, you know, Lean or Theory of Constraints, like, well, why not? Why not? And thinking about the, the focus on process, you know, within, you know, Lean mindset and, and methodology. That doesn't mean it's process or people that we, we, we, we can, or it's not, you know, need to focus on both. Right.

George Saiz (20m 39s):
Right. I mean, it's, it's, people are the ones who are doing it. And our culture is how we get that done. Our processes are how we deliver the product. And so they're all equally important. Yeah. In fact, you'll, I, that's, there's four things that I'd like to look at as a senior leader when I, when I go to a company. and that is a begin with the people and then the culture, because I believe the people are the ones who are gonna do the job and the culture's, how they do it, then the product portfolio. Cause that's what we're gonna deliver to our customer. And then the operating systems. And those are how we deliver it to our customer. And so they're all integrated together. My belief is you can have great products in a great system, but if you don't have the right people in the right culture, you're not gonna be able to deliver it.

George Saiz (21m 20s):
And So, I like to start first with that people, but you need all four ultimately Yeah. To be successful.

Mark Graban (21m 27s):
Yeah. And you know, you, you, you bring up trust, Like what I mean, without trust, you know, Toyota uses language around mutual trust, like without mutual trust. I don't know what else you can really accomplish. Cuz when you think through, you know, scenarios where aspects of Lean or the Toyota production system only work because of trust. Like for example, I think of somebody reaching up and pulling an and on cord. It's not gonna happen without mutual trust of management. Trusting the employees aren't gonna just pull the cord cuz they don't wanna work. and that lead employees trust that their leaders aren't gonna come and yell at them or blame them or punish them.

Mark Graban (22m 11s):
Like, what, what are some other elements of Like? what, what just wouldn't work in the context of Lean without a high enough level of trust?

George Saiz (22m 23s):
Well, I, I think what you're mentioning there, that's, that's a, that's a very good point that, you know, the, the folks, when we talk about respect, I think that the one thing that I've always advocated is that if we talk about respect in the business, we tend to think about respect from management to employees. And that's very, very important. But I think that when you're developing your culture, it's gotta be a culture of respect from management to employees, from employees to management and from employee to employee. And you have to have that, that entire circle because you know, you're ultimately, you're dependent on each other as a, as a team. And as you said, you know, that, that trust, when you're gonna pull that cord, we're gonna stop that process. That management is gonna say that's a good thing to do.

George Saiz (23m 4s):
And, and there's, there's recognition. I remember going to a, a tour of a company that they had had a recognition board and they had up there posted all of their failures. And So I thought that was really interesting that they were, they were that open to say, we're gonna congratulate and reward this person because they found a failure and they found it here. And the importance that they emphasized was you found it here and it wasn't our customer finding it out there. Yeah. And they celebrated, you know, they're all the times when they found a mistake, they celebrated those. And that's, well, that's a heck of a, you know, trust there that, that's been developed. Yeah. And and respect between each other.

Mark Graban (23m 44s):
Yeah. And, I, think I'm remembering the late Norman Bodak talking about some companies that would do that same thing. I think this might have been, you know, from one of his Japan visits. But you know, in the context of doing my podcast, my favorite mistake, I've had some guests talk about celebrating Mistakes or failures, you know, within an American company. Jim, Jim McCann, who was the founder of 1-800-FLOWERS, very different type of business. You know, he, he described how, you know, they, they would kind of do a celebration and like, you know, mistake of the month

George Saiz (24m 21s):
Yeah.

Mark Graban (24m 22s):
Awards even. And like that doesn't, like, to me, that doesn't encourage more Mistakes. We're not, you know, some somehow incentivizing it. We're just recognizing the reality of Mistakes are happening and, and to, to, to celebrate the fact that somebody felt safe to call it out.

George Saiz (24m 42s):
All, right.

Mark Graban (24m 42s):
I think helps us improve.

George Saiz (24m 44s):
Can't, I mean, I can tie back into our discussion on committed versus compliant. You know, the compliant person says, oh, well not my job. You know, I did what I was supposed to do, I was compliant. Check the box. But the committed person says, I don't think that looks right. I think there's, there's a potentially a problem there. Can we check this out before it gets to the customer? And you know, they care enough about the, the company to do that and they feel safe to do it, obviously.

Mark Graban (25m 9s):
Yeah. Yeah. So, and one other thing I was gonna ask you, George, on your website, you, you, you cite some of that gets brought up a lot, you know, the Gallup employee engagement surveys, or we could almost start calling it the disengagement survey, right? Longstanding problem. It's not just a covid era thing of, you know, two out of three employees being disengaged or highly disengaged kind. Talk through this maybe from a problem standpoint, like, first off, like why, why do you think that exists? So, I wanna maybe talk about countermeasures, but Like what to to you from your, what your observations and experience Like. what, what what are the causes, if not root causes?

George Saiz (25m 50s):
Right. Well, And I do use a lot of that information in my book. And in fact I'm, I'm doing a keynote presentation and, and citing a lot of that information. You know, I think the, the, the first thing that comes to mind for me is, is the leadership approach. Cause it's, it's, it's our job as leaders to provide a culture that is both engaging and motivating to our employees. And So, you know, I I don't look to the employees and say, what's wrong with you? Why aren't you engaged? It's why have, what have we not done to create a culture that engages and motivates you? And for that, in, in fact, I like to look back and say, well then how do folks get into leadership?

George Saiz (26m 32s):
You know, when we think about our leadership model, you know, typically if there's an opening, it's usually the person that's been, you know, a functional leader, you know, they've been good at their functional role. So the person that sells the most becomes a sales manager person that produces the fastest, becomes the, the lead or the production manager. We're hoping they'll replicate that. But just because they've done that, and I'm not meaning to say to belittle this to you, but, but have they, were they a leader to begin with or have they been trained to lead? And we tend to just place them into this leadership role and then hope for the best. And, and, and so we've got this whole group of leaders out there in a, in a company and, you know, what percentage of the folks are in leaders, but they're influencing all these folks.

George Saiz (27m 16s):
And as I say, you know, I, as the ceo, I can go up and stand in front of employees and say, I'm gonna advocate for a people-centric leadership approach here in our company. But for you and for every employee, the the culture of the company is just what your leader and what their approach they're using. And so if I say people-centric leadership, but your leader is a tyrant. The company culture to you is tyrannical them. And So I think that's the gap is that we're looking at this and saying, well, there's the, there's the results of the survey. Yeah. They're not good. And I think leaders tend to respond in a more business centric stand from perspective.

George Saiz (27m 57s):
And they say, okay, I see those Gallup results. I must be leaking productivity like crazy because of that. Yeah. And so the first thing they do is develop some countermeasures to, to address that. They say we're going after engagement, but they're really after productivity. But I would say that if you, the, the people-centric leader would say, well what can I do to motivate that person to engage? I like to use the word fulfillment cuz I think fulfillment is a great trade for engagement. And if we can do find a way to fulfill our employees each day, then they've been naturally become engaged. And guess what, then all those production numbers, you know, the engagement numbers. But by the way, there's a whole slew of statistics that Gallup also publishes that shows they, they compared the top quartile companies from their Q 12 survey in employee engagement to the bottom quartile.

George Saiz (28m 48s):
And there's a whole slew of statistics of how much better it is that they're the operating results when you're in the top quartile and it ends, you know, the productivity is in there as well and safety and, but it ends with 23% more profitability. So, so when we invest and find a way to engage and motivate our employees, we're actually going to improve our business statistics as well by leaps and bounds. And so long-winded answer, I think it goes back to leadership and leadership and the culture that we establish and how we're able to engage our employees. Yeah.

Mark Graban (29m 26s):
Yeah. It's a podcast. Long-winded answers are. Okay.

George Saiz (29m 30s):
Okay, good. We

Mark Graban (29m 31s):
Have time. It's All right? Brain cramps are okay too. It has,

George Saiz (29m 36s):
Ok, good.

Mark Graban (29m 39s):
Yeah, I mean there, there's so many things you touched on there, you know, other, other causes or contributing factors of like, and this happens a lot in Healthcare, taking the best individual contributor, rewarding them by saying you're now a manager and then not really you giving them standards or, or training or expectations of like, oh, you'll figure it out. And I'm like, well, some people do, but then some people end up kind of following the pattern of whatever tyrannical leader they happen to be working for and Right. It's, it's un you know, it's, it's unfair. It's, again, not the path to world class performance, but you've probably seen companies that are willing to make that investment in supervisors, managers, training.

Mark Graban (30m 27s):
What, what have you seen that's sort of like, you know, the best of that?

George Saiz (30m 31s):
Well, I can think of, I'm trying to think of the company's name that there's the airbags and up, up in Utah, Autoliv. Yes. What a fabulous tour. I've been there a couple times and you know, clearly that, you know, the, the amount of investment they make in their managers leads leaders. In fact, I remember the first tour that I went through and it was a lead telling us about a section, And I thought, my gosh, this person has got stronger leadership principles than any manager I've ever met. And they're a lead. And it was, it was phenomenal. The, and you know, what they had done at, at that company and, and So I think that was always for me where the bar was set in terms of investing in leadership.

George Saiz (31m 18s):
And you know, I think that one of the elements that have in, in the book is every leader buys in. So it's basically a hundred percent leadership buy-in. And, and some people see that as maybe as an ultimatum, but I think about us in Lean and we have standard work in production, right? I mean, and would we in production say, well it's okay, this is, this is how we'd like you to produce this product and here's a picture of it. But you know, You don't have to follow it. You can do it any way you want. I mean, you'll

Mark Graban (31m 50s):
Figure it out.

George Saiz (31m 50s):
Yeah, yeah. You know, here's, here's what you should do in the end. You know, whatever you have to do to make it that. Well, we don't do that, but yet when it comes to leadership, one of the most important roles in our company, we just kinda leave it up to chance. And so yeah, I think it's a, it's a big gap in our systems and, and conversely it's a huge opportunity. And, and certainly we'd see that with the, the kind of numbers that they were sharing with us at Autoliv, you know, the investment was paying off hugely.

Mark Graban (32m 20s):
Yeah, yeah. No impressive results. And especially unimportant things like safety and, you know, doing some work that's inherently risky or dangerous if they didn't have good process and, and good training for everybody involved.

George Saiz (32m 34s):
Yeah. We talk about rocket science and literally they're, they're, they're developing an airbag, something that's a controlled explosion, you know, so yes, safety is a big thing there.

Mark Graban (32m 44s):
Yeah. Yeah. And you know, you think of the things you take for granted and, you know, quality and excellence. I used to use this example of like, you know, when you're driving down the road, You don't have to even think of whether a, if I were to get into a bad front end collision, would the airbag go off? Very, very likely to happen? And you also don't have to worry about it just randomly going off. Now one of their competitors, Taketa then got into a bunch of trouble with that And I, I stopped using that example, but I think it still applies with auto.

George Saiz (33m 18s):
Right, right. Yeah.

Mark Graban (33m 21s):
And then I, you know, medical devices, I think another area where, you know, you, you sort of take for granted, you know, high reliability, high performance in, in a way that healthcare delivery, you know, hospital care and, you know, you, you couldn't, or you shouldn't make that same assumption of, of high reliability unfortunately in, in other settings, So, I, sorry, I got up on a soapbox there, but, well,

George Saiz (33m 46s):
This so true. And having come out medical device, you know, arena, you know, certainly committed versus compliant was very important. Cuz we like to would say to our, our employees, you know, what if this product was being used on your spouse, your child, your mother, you know, and, and make it make everyone like it's going to be used there because you know it's gonna be used on somebody's mother, somebody's father, somebody's child.

Mark Graban (34m 9s):
Yeah. Yeah. So around culture, again, you know, that that's, you know, we, we've been talking about it here. One of the themes, you know, with the book, creating an extraordinary culture, one thing I wanted to talk about here a little bit more depth was being intentional or focusing on creating or designing or whatever word you might use of like actively focusing on culture. Why, why is that so important? Why, why is that better than the alternative?

George Saiz (34m 40s):
Right. Well, you know, for me, actually the word intentional that's used is, is the word a big word for me. And And I was always a proponent of people-centric leadership. I was involved in that, but then I went to a, a leadership summit and it was put on by ame, but it was hosted by Bob Chapman, the c e o of Barry Waymiller. And at this meeting he used the word intentional and he used it in terms of having an intentional plan for your culture. And I thought about that. And I thought about as president of this medical device company that I was at then, that, that we believed in all these things and advocated and certainly we had a set of values that we had spent a lot of time crafting and they were up on our website and up on the walls somewhere.

George Saiz (35m 23s):
But, but did we really have an intentional plan for taking those values and integrating them into the business and into the way that we interacted with each other? And the answer was no. And so that really got me thinking a lot about, at that time of how do we make this really an intentional way we do business? And and I'll tell you that when I wrote my book, I had a big aha moment related to this. I, I sent the book out to three different groups of beta readers of eight people each time. And so then I started getting this feedback. And so it was very interesting. So I had a, a guy that I worked with in the 1980s say, wow, George, you wrote all about us.

George Saiz (36m 8s):
Yeah, there were some things in there about us, but, and then, and then another person that I worked with in the 1990s at a different company, he said, wow, you wrote all about us And I. Yeah, sort of, yeah. But then somebody I worked with in the two thousands, and he said the same thing, and even a gentleman by the name of Dick Bryan who worked at Wire Mold said, you know, I read your book and, and he said, thought you told the wire mold story from start to finish, just say from, huh. And it, what really hit me was, was that from what Bob said, that the real issue is, you know, we've been vol evolving in our approach to culture and leadership. So if we go back to World War ii, you know, post World War II was very much a business-centric culture.

George Saiz (36m 49s):
And the leadership approach was command and control, you know, based on our military success. And then, you know, we get into the 1980s and it was much more team-based with quality circles and self-directed work teams. And then we go to the two thousands, you turn the century and we start talking about servant leadership and then people-centric leadership where everybody feels valued. And I think that, that the companies that participated in that, that evolving approach to culture were the ones that, that saw those changes. But the real issue was that most companies, like the companies, the companies that I worked with and the people that were re responding was they didn't have a an intentional plan. They had a culture by default.

George Saiz (37m 29s):
And so what they had was what we talked about before, somebody getting promoted into a leadership role and you know, they're doing either something they read or or the person that they work for or you know, whatever. But, but it's different depending on which door you open. You know, you open a door and it's a whole different culture in each room, and that's what your company's made up of. And so there's no intentional plan, no standard work. Employees are left to say, I don't know if I, those guys get raises differently or there's a different disciplinary plan or different promotion plan. And don don't know that. And, and then you go back into regressing into I'm just gonna be compliant cuz I don't know what's going on here. It's all confusing. And, and so yes, the whole idea of an intentional plan is having, just like we have, we have strategy deployment to help us achieve our mission and vision.

George Saiz (38m 19s):
I think we need an intentional plan of our culture to help us integrate the values because we all do have that set of values up there on the wall, but how do we get 'em into our business? How do we get 'em into the way that we do everything and interact with each other on a daily basis? Yeah.

Mark Graban (38m 35s):
Yeah. I love the way you, you talk about that and, and some of that phrase culture by default or, you know, I'm thinking of somebody I've learned a lot from the last couple years, Tim Clark, the author of a book, the Four Stages of Psychological Safety, which is about culture and leadership. And he emphasizes, yeah, you always, you have a culture, right? So in let, instead of letting, letting it be a culture by default or just evolving or happening, he uses the phrase, similar to what you're saying, culture by design know, and that's name of, of his podcast or recommend, you know, anyone listening to this, check out Tim Clark's podcast, culture by Design, great way to learn about leadership, psychological safety and, and what that leads to improvement and innovation, better business results.

Mark Graban (39m 25s):
It's all connected to, to trust and things that we've been talking about here today.

George Saiz (39m 30s):
Right? Right. Well, we believe in that for our processes, we believe in standard work. Why wouldn't we do the same thing with, with our leadership approach? And, and it's not an ultimatum, it's, it's being consistent and, and in using best practices throughout the company. Yeah.

Mark Graban (39m 47s):
So, I wanted to ask, you know, I, there's two other, I think, you know, key pillars, it seems from your book, And I, I think they're kind of interrelated So, you know, beyond creating an extraordinary culture, the other two being tearing down the walls and connecting the dots. If you would, you know, George, give us kinda a summary of what you mean by those phrases and hopefully I'm not wrong in that they're, they seem interconnected.

George Saiz (40m 11s):
Yeah, well, I think they are too. And, and, and certainly tearing down the walls, we, you know, when we do have this culture by default, and as I said, when you go into each each, you turn to the key and go to each door. You know, the, the, the culture's different and, and we tend to not have them, you know, companies, you or departments working with each other. We have the, the old over the wall mentality and, and so we've gotta tear down those walls. And it starts, to me it starts in the, the, the senior leadership, the executive leadership team. You know, too often I think that leaders, I talk about this a little bit in terms of, of teamwork, but leaders come into a meeting and you know, my question, do they come in as part of that leadership team or do they come in as a representative of their function?

George Saiz (40m 57s):
You know, they trying to protect their territory and their turf. And all that does is erect walls between departments. And, I think that when a, when a leader comes into a meeting, they should be aligned to the team that's highest on the, in that room. And in fact that the senior leadership team sh you know, that the HR person should be bringing in the toolkit of hr, but they should be part of that leadership team that's making decisions and, and are accountable. And it starts there as far as tearing down the walls. Because if the walls are up there, believe me, the walls are throughout the organization and everyone's doing duck and hide and you know, they're not gonna help each other. So it, it's So I think that first step is you've gotta tear down the walls that are between, you know, the departments and make sure that that's all open and working together.

George Saiz (41m 44s):
And then connecting the dots is, is just what we've been talking about. Then just, you know, you tear down the walls, you've gotta put something this place and it's reconnecting that and, and that's connecting with each other throughout the company. Advocate in, in the book talked about, one of the things that the teamwork team did was, was ask each department to have a, a meeting with one of their suppliers within the company, one of the supplying departments and with one of their customers. So if they were receiving parts or information from one department to meet with them and then conversely to meet with the person that they process is next in their step. But by sitting down and understanding what each other are trying to accomplish and, and you know, you realize that the other department isn't the enemy.

George Saiz (42m 28s):
You know, I've, I've led that off in many comes that I've gone to and, and started, my first thing I asked is, who's the enemy? You know, the enemy isn't, you know, the person that's working next to you isn't the other departments. And so when we understand that and understand that they're trying to do a job and, and break that down and how, how can we make that better then, you know, you open up those lines of communication and it's, it's really powerful. And then begin to connect those, those dots.

Mark Graban (42m 52s):
Yeah. Yeah. You don't ever want to hear the production department think the quality department is their enemy. I've worked in some environments like that again, that that's, that's not the foundation for world-class performance. You, you, when, when, when that exists or sadly in, in Healthcare, if people view the patient safety department as the enemy, like we should all be working the same goal. Back to what your point of, you know, what, what if that was your grandmother on the operating room table? Like, you know, but it's, it's just, I think like a lot of it flows downhill to your point of like, if the, if the executive team is not really a team and there's infighting and posturing and blaming, of course that's gonna cascade through the organization.

George Saiz (43m 43s):
Absolutely. Absolutely. I've worked in the company just like that and, and in fact, you know, I think so many times that, you know, our leadership role models are, could be people that have shown us great things to do and some that have shown us what not to do. And, and, and that was something that I did see in one company is, oh my gosh, it was, you know, the, the vice presidents were set up against each other and so there was, there was, you know, there was a lot of infighting in the company. And so yeah, absolutely. That's a big part. Starts there.

Mark Graban (44m 14s):
Yeah. It starts with respect, it starts with teamwork. There's that, that the title of the book is we started with Respect, which is a great place to start. And I'm, I'm glad you're emphasizing that. Our guest again today, George says the book is available now, paperback format, hardcover format, kindle book format, and it's, it's available for order now. So go and check that out. I'll link to George's website in the show notes as well. So I'm gonna ask one other question before we wrap up. George. You know, I, I asked about your Lean origin story, but I also like to ask, you know, at any point along the way, are there any kind of key influences or mentors that really, you know, helped your, your learning, your growth in, in your understanding and practice of Lean?

Mark Graban (44m 60s):
Anyone that, you know, as we've been kind of jogging your memory about some of these different companies and places you've been, is there anyone that you know is kind of worth kind of calling out as being, you know, influential?

George Saiz (45m 13s):
Well, there's, I've, I've been fortunate to have mentors throughout my career. You know, starting very early on when I got into my first role in, in any kind of a leadership role. And it was somebody that, that believed in me that I was pleasantly surprised by that and, and gave me an opportunity. But one mentor that I had, and this relates to Lean cuz it relates to teamwork, But, he, he advocates something that was very, very, very corny, corny statement. And, but I've kept it throughout with me, throughout my career. And he said that with teamwork, well, listen, start without teamwork, two plus two equals three we're playing against each other.

George Saiz (45m 56s):
Yeah. And he said, with teamwork, two plus two can equal five. And you know, it sounds corny, but it's something that I have found that worked. That first company that I took over as, as general manager, we had a, what we called our operating statement and it was teamwork, quality and speed. Our future depends on it. And it was, it was that simple, but I really believed in, in that teamwork. And it's amazing how simple it is. Maybe how corny that statement is, but how true it is. And it's powerful. I mean, it, it's just powerful the way you can move mountains together as a team.

George Saiz (46m 36s):
And it's certainly a lot more fun. But that, that mentor shared that with me and it's stuck with me, you know, for all these years. Yeah,

Mark Graban (46m 45s):
Yeah. And we can all be grateful, you know, hopefully we, we have mentors who, like you were saying a minute ago, were help who helped show us what to do, not just the Yeah. War stories and the wounds of that, that, that come from seeing what not to do. Hopefully we have both.

George Saiz (47m 7s):
Right, right. Well, I tried to pattern some of the characters after, after some of the folks that I was lucky enough to, to work with throughout my career.

Mark Graban (47m 14s):
Yeah. So again, the book is, we started with respect. I, I've gotta ask though, like I, you know, the the business novel format, you know, the goal kind of set the standard of where like, you know, the plant manager, there's also kind of like trouble at home and tension with his wife And I don't like, is, is that par for the course that there's kind of, you know, a subplot about the protagonist lead characters, family and other struggles? Or is this mostly a business novel about business?

George Saiz (47m 44s):
Well, it's mostly about business. I, I thought about going that way a little bit. And I, remember Alex Rogo and what he went through, but Right. Oh, it was, it was too much, you know, to, to try and weave that in was enough to write these characters. Originally though, I'll tell you, I wanted to write the book through the ice of three characters. And what it was meant to be was jobs that I had in my career. So through and So I did write it through the eyes of a distribution associate that I, a role I've had my first role in, in medical device as a supply chain manager, and then as a CEO and originally I really wanted to follow these three characters in depth of what they were going through, through this transformation. But I realized that as I started trying to do it, it was gonna get so big, it was gonna be like a Tom Clancy novel that nobody would, and So I, I do include those three characters in there, but it's, I'll say it's, it's probably 85, 90% through the CEO's eyes.

George Saiz (48m 40s):
And then we still do capture some of the things that happen with these other two characters in the, in the, in the novel. But we pretty much, I do bring in some of their, their, their outside life, but pretty much keep it, keep it contained to business. But there is a, you know, there's, there's some different characters in the, you know, there's always like the character that you wonder are they gonna make it or not. And so there, there's, there's one of those. There's also, I I, I didn't say anything this before, but there's also a character that has a unique quality about him. Oh shoot, I said him that wasn't that I just, just, just narrowed it down, But has, has a very unique quality in the way that he speaks.

George Saiz (49m 26s):
And so one of my questions after for all my beta readers is if they could figure out what was his unique qualities, And I will tell you that all 24 readers fail. They, no one was able to figure out his unique qualit. So if somebody can figure that out when they read the book and post it on a review, that'll be fun to see. I'll, I'll certainly respond if I can see it and, and say, you got it. Cause no one, no one has figured it out yet. It's a very subtle but definite part of this character.

Mark Graban (49m 56s):
All. right. Cool. Again, we've been, Jo joined today by George SAEs. The book is, we started with Respect Available now Congratulations, it's, you know, it's a, a fir a first book. It's an accomplishment, a milestone. Hope you have opportunity to celebrate that.

George Saiz (50m 15s):
Oh, absolutely. Thank you. It's been, it's been a real, fun, fun journey.

Mark Graban (50m 19s):
Yeah. are you mean with the book or today on the podcast? Hopefully

George Saiz (50m 23s):
Both.

Mark Graban (50m 27s):
Yeah. I always enjoy talking to the things we've been talking about. This is, this is fine. Yeah. It, it has been So I. Well, double check. Dangerous question. I'm not a lawyer. They say don't ask a question You don't know the answer to. Right. That's not how a podcast works. But yeah, thank, thank you for rolling with it, George. You've been a great guest and hope people will go check out the book. Really, really, really appreciate it. Thank you. Thank you, Mark. I appreciate it too. Well, thanks again to George for being our guest today. To learn more about him, to buy his new book and more, look for links in the show notes or go to leanblog.org/481.

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Mark Graban
Mark Graban is an internationally-recognized consultant, author, and professional speaker, and podcaster with experience in healthcare, manufacturing, and startups. Mark's new book is The Mistakes That Make Us: Cultivating a Culture of Learning and Innovation. He is also the author of Measures of Success: React Less, Lead Better, Improve More, the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, and the anthology Practicing Lean. Mark is also a Senior Advisor to the technology company KaiNexus.

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