Wednesday, August 5, 2009

Fear of flying

So--46 years after Toyota adopted hoshin kanri as its management system--why haven't American execs copped on to it? And this despite the huge, huge success of the Balanced Scorecard (or at least the success of Balanced Scorecard consultants), derived as the Balanced Scorecard was from Analog Devices' implementation of hoshin kanri... Not to mention the success of Six Sigma's Breakthrough Strategy, again derived from hoshin... Not to mention the successes, respectively, of the Baldrige Award or the Shingo Prize, themselves based upon a technique (the President's Diagnosis), again derived from hoshin... Und so veiter, und so veiter, etc., etc., blah blah blah.

One wonders...

Actually, I think I know why: the fear of flying.

Let me explain.

To quote Jeremy Hope and Robin Fraser, authors of Beyond Budgeting and fathers of the similarly named movement, the future is about "radical decentralization."

Radical decentralizaton means that, in the enterprises of the future (Toyota, for example), front line employees are trained and empowered to discover and fix defects in real time. Moreover, if upon discovery of a defect an employee is not, unaided, able to fix said defect, he/she is empowered to interrupt production--even stop a major manufacturing process or entire production line--to call managers to come running to assist. At Virgina Mason Medical Center, my partner Mike Rona extended this practice to healthcare in the form of a Patient Safety Alert system. (Brilliant.)

Well, what American or European or, for that matter, Asian-trained fast-track MBA would be willing--in his/her right mind--be willing to do that? In any industry, let alone healthcare? There is baked in to to the degrees offered by our schools of higher management education, shall we say, a fear of flying. Which is to say that there is a fear of letting go of power. As a result, while American, European, and even Asian companies may dabble with the Balanced Scorecard, Just in Time (JIT), Six Sigma, and even Total Productive Maintenance (TPM), there is never any real empowerment of the workforce.

It looks like empowerment; but it is not empowerment.

For empowerment--aka "radical decentralization"--to work, two things must be present. Or, as John Shook put it, "It takes two to A3." First, you need a genuine delegation of responsibility to the workforce. And indeed, the tools of JIT, Six Sigma, and TPM are all designed in precisely this manner. Only an empowered workforce can make JIT, Six Sigma, and TPM work the way they are supposed to. Second, you need a management control system that respects empowerment. This would be hoshin kanri, and not its half-baked cousin, the Balanced Scorecard. Instead of embracing hoshin kanri, our managers still cling to the control system designed by Alfred Sloan in the 1920s, a system which is still the core message of the curricula of our schools of business: partial decentralization (to divisional presidents, and definitely not to the proletariat) and control by means of management accounting.

And the Balanced Scorecard? I am reminded of the brightly painted, coin-operated airplane rides my mother, arms full of groceries, used to put me in on the way to her car.

I thought I was flying; but I was not flying.

How poignant.

1 comment:

Mike Davis said...

Agreed again my newly found friend. Ref my comment to your blog of 2 days ago.
So you motivated me to start-up my blog:
Here it is at :

Mike Davis