Monday, April 5, 2021

Why Lean in Sales?

By Pascal Dennis (bio)

Why indeed? Isn’t Lean a factory thing?

Well, no…Lean is a business system comprising the entire enterprise.


The Toyota Business System, for example, addresses the three critical “loops”:
  1. Design
  2. Make
  3. Sell
Guess which one is considered most important? Sell – because it’s closest to the customer.

Sales are about information. What features does the customer want? At what price point? What promotions does he respond to? How does she want to receive her products or service?

How was our last promotion perceived? And so on...

Production (Operations), usually our most valuable & expensive asset, runs on information. We only make what our information tells us to make.

If our information is wonky, our most valuable asset is unlikely to operate in its sweet spot. Result: overproduction, inventory and all the associated ills.

So how do we introduce Lean in Sales?

Here are some questions to get you started:
  1. What is value in Sales? (Who are our internal & external customers and what do they need from us?)

  2. What is waste?

  3. What are some core mental models in our Sales department?

  4. What are our current processes for delivering this value?
  5. How aligned are they to delivering the value our customers expect?

  6. How do we improve them?
Lean is harder outside the factory – because our product & processes are typically invisible.

If you make scrap in a factory, everyone can see it. “Hey, we made a whole pile of junk yesterday…”

In business processes, by contrast, you can’t see the scrap. A good forecast & a bad forecast look identical…

On the plus side, sales folks are usually smart & creative. If you introduce the fundamentals with finesse, they run with them.

All for now.

Pascal

PS For more, check out The Remedy – Bringing Lean Out of the Factory to Transform the Entire Organization.




In case you missed our last few blogs... please feel free to have another look…

Back to Basics - What is Value?
You Want to Get More Done? Do Less…
Strategy Deployment & Language
Where Lean Has Gone Wrong & What to Do About It, Part 2

Monday, March 22, 2021

Back to Basics - What is Value?

By Pascal Dennis (bio)

Value is Lean’s guiding star, Mother Lode and raison d’etre.

So what is value? Here are some common definitions:
  • ‘What the customer is willing to pay for.’
    • Okay, but what if the customer doesn’t know what they’re willing to pay for? (Would customers have said yes to the IPad in conception?)
  • Value = Quality/Cost
    • A serviceable definition
  • Changes form, fit or function of a product
    • A nice manufacturing definition, but does it apply in, say, a bank or hospital?
  • An action that moves a process forward
    • Nebulous, no?



All of these are correct, in their way. Value is like a gemstone – hold it up to the light and different colors emerge.

Most importantly, the team must connect closely with internal and external customers and understand value from their point of view.

This is the beauty of connectivity and commerce. Work is activity that creates value. Our work enables our customer, who is thereby able to create more value.

The splendid work of Steve Jobs, Bill Gates and their teams compound my productivity (such as it is).

Work ennobles and enriches both the worker and the recipient, which is why we revere it so.

(Of course, there are extreme philosophies that demean work, and believe value is fixed and cannot be created. For these, the only question for such is how to divide the economic pie.

But you rarely see them in a factory, hospital, design studio or any place value is created.)

In summary, value is Lean’s guiding star. Get close to your customer and ask them what they need from you.

Best regards,

Pascal



In case you missed our last few blogs... please feel free to have another look…

You Want to Get More Done? Do Less…
Strategy Deployment & Language
Where Lean Has Gone Wrong & What to Do About It, Part 2
Where Lean Has Gone Wrong & What to Do About It, Part 1

Monday, March 8, 2021

You Want to Get More Done? Do Less…

By Pascal Dennis (bio)

Continuing with Strategy Deployment today, and highlighting an especially interesting paradox.

How to get more breakthrough activity done?

Do less…

Don’t crowd the Right Hand Side of your strategy A3. (I was taught ‘no more than 5 activities – and even that’s too much!’)

If we have ten countermeasures on the RHS of our paper, do we really understand the strategic problem?

Chances are we’re simply buffering our lack of understanding with volume. (“One of these is sure to have an impact!”)


Fatigue and exhaustion is the risk of course. We have a limited number of hours for improvement activity – often 10% or less of our time.

Surely, we have to use this precious time wisely.

Understanding the ‘less is more’ principle is vital for senior leaders. Remember, everything on your A3 maybe multiplied many times over on baby A3’s.

I’ve been lucky enough to observe great masters of A3 thinking, who are able to distill complex problems down to their essense.

“Here’s our critical gap and root causes. And here are the two things we’re going to do about it…”

‘Says easy, does hard’ – but we have to keep trying.

Best regards,

Pascal



In case you missed our last few blogs... please feel free to have another look…

Strategy Deployment & Language
Where Lean Has Gone Wrong & What to Do About It, Part 2
Where Lean Has Gone Wrong & What to Do About It, Part 1
What is Courage & What’s It Mean for Strategy?