Terence T. Burton
By
December 06, 2016

ARTICLE: What's Your Lean Business System Reference Model?

Kata: A systematic global cultural development process where patterns of behaviors, values, and codes of conduct are routinely practiced through continuous structured means and deliberate actions, until the protocols become second nature with little conscious attention.

Screenshot 2016-12-06 14.47.09.png

For most organizations, the magnitude and rate of improvement from their Lean, Six Sigma, OpEx, or general strategic improvement initiatives has reached a maturity and decline point. We have definitely observed these shifting conditions in our consulting practice where our forward thinking clients are requiring higher and more immediate breakthrough improvements at a lower total cost.  Hence, our service delivery model of strategic improvement is very different than it was a decade ago.

For decades, continuous improvement has been exported and interpreted by Western organizations as an oversimplified piecemeal venue of individual tools, principles, and the associated acronyms, jargon, and manual storyboards. These approaches to improvement are extinct in our digital global economy gone wild.  In retrospect, this is a fragmented, sub-optimization strategy of improvement. The journey has not been a holistic, enterprise-wide and culturally grounded and permanently internalized strategy like Toyota. It is not the fault of the improvement methodologies; executives and their organizations have continuously allowed themselves to fall into a kind of continuous improvement pit.  Today improvement initiatives are a commodity: Everybody is already doing Lean, Six Sigma, and/or OpEx in some form or fashion with varying results. The smart organizations have integrated both, others continue to debate the relative value of one versus the other.  In too many organizations, if the plug was pulled on these improvement initiatives, most people would not notice much of a difference and continue with their daily routines. 

Recognize that the Lean philosophy is not a static, steady-state value proposition of improvement, and it is not limited to manufacturing.  The World is changing, the notion of process is shifting to a higher and increasingly complex human and technology content.  The future requires a more holistic, integrated, and systematic approach to improvement – especially the cultural and technology elements of transformation.  Successful organizations are responding to the speed of change required to remain competitive with a more holistic, higher order daily business systems approach to Lean and continuous improvement. 

 

Find your model – Global Kata

We began construction of a Lean Business System Reference Model just before the 2008 meltdown to help clients (and ourselves) through a new paradigm of Lean driven by accelerated business and economic requirements, emerging technology solutions, and a heightened focus on leadership, management infrastructure, and behavioral and cultural development needs. Over time we have built out the reference model by integrating new thinking, client implementation experiences, benchmarking, emerging technology architectures, and proven best practice information strictly for internal guidance in diversified client environments. Because it is a reference model, it is a continuous work in progress and is never complete. 

Many organizations claim to have a Lean or XYZ Company Business System, but it is in label only because the systematic and cultural substance is missing.  A major objective of the reference model and this book is to guide organizations away from the superficial mimicking and success-limiting scope of Lean manufacturing principles and tools from other successful organizations and to rethink, innovate, expand boundaries, develop the right improvement Kata culture, and become the next global Toyota organization in their own way.  

Screenshot 2016-12-06 14.48.15.png

The Lean Business System Reference Model™

Global Kata provides a holistic value system of improvement that is a much larger endeavor than how the concept has been introduced previously: four documented habits and five questions on a pocket card used on the production floor.  In all fairness, this is a good start but a very small start in the scheme of global improvement.  At the enterprise level, kata is more complex and incorporates a much broader spectrum of values, knowledge, behaviors, and technology protocols.  Why?  Because the human and technology influence of improvement is much greater on an enterprise and global scale, but soo too are the opportunities and operating benefits.  Global Kata is a deep deliberate system of adaptive leadership, organizational and talent development, and nurturing the right behavioral and thinking patterns everywhere . . . to continuously transform culture for real, to higher and higher levels of intelligence and performance.  

The diagram below provides a concept overview of the Lean Business System Reference Model™.  Our reference model serves as a guide and playbook for creating a higher order paradigm of Lean and strategic improvement in general. The reference model provides the adaptive leadership guidelines, overall architecture, operating processes and sub-processes, cultural development best practices, and key performance metrics of a holistic XYZ Business System.  Obviously there is a wealth of detailed operating system design criteria, best practices experiences, and "how-to-do" guidance behind this overview chart. 

The Lean Business System Reference Model™ provides a working framework for designing, developing, and implementing best practices relative to adaptive systematic improvement.  This reference model provides the total architecture and sub-processes for creating a for real, forever Lean Business System.    It serves as the organization’s relentless, never-ending operating system of improvement.  The reference model is a guide to adapting and architecting an organization-centric and culturally grounded Lean Business System.  It provides the detailed architecture, sub-processes, and best practices for both the visible (operating system, principles, methodologies, tools) and invisible (behavioral alignment and cultural development) sides of adaptive systematic improvement.  The Lean Business System Reference Model™ helps organizations to design, integrate, adapt, and systematize high velocity and high impact improvement in a variety of different industry environments, business requirements, cultural situations, and industry segments.  It helps organizations to implement and sustain a superior, enterprise-wide, technology-enabled, and culturally grounded Lean Business System . . . in their own way.

Guidance Metrics: Lean Business System (LBS) Analytics

LBS Analytics® is the assessment and evaluation criteria in the Lean Business System Reference Model™.  We have developed an evaluation software solution as part of the reference model to help executives, change leaders, and strategic improvement practitioners think through the design, architecture, implementation, and sustainability requirements of a higher order, enterprise-wide, technology enabled, and culturally grounded Lean Business System.  Below is a graphical example of one of the largest detractors of success: Misalignment of business strategy and improvement strategy.  

Screenshot 2016-12-06 14.48.24.png

LBS Analytics® incorporates over 600 best practice evaluation points and is very useful in pointing out gaps, root causes of underperformance, and missed opportunities with an organization's Lean and other strategic improvement initiatives.  The analytics model has been architected to provide significant value to organizations in as an enabler to:

  • Design, architecture, implementation, and ongoing sustainability of a for real Lean Business System. 
  • Baseline, evaluate, and understand gaps in current performance of an existing Lean Business System relative to leadership, strategy and execution, cultural development, desired performance, and best-in-class performance. 
  • Measure relative progress against previous assessments, across business units, or comparisons to best-in-class performance.

Collectively the assessments generate very objective and pragmatic guidance, with pointed prescriptive and graphical analytics for developing a for real, higher order XYZ Business System.  The largest value of LBS Analytics® is its ability to help organizations discover a new and superior paradigm of Lean and strategic improvement, and identify millions of dollars in new improvement opportunities.

Summary

The philosophy of improvement is universal, but the correct path to adaptive systematic improvement is very different in different industries, operating environments, and cultures.  Like all reference models it evolves every day as we acquire new knowledge through our own experiences and the successes of others.  However, the reference model is a bold step to the next evolution of enterprise-wide, technology-enabled and culturally-powered Lean. 

Terence T. Burton is Founder and President of The Center for Excellence in Operations, Inc. (CEO), a management consulting firm that works with mid-market companies and private equity organizations on Operations, Supply Chain, Go-To-Market, Cash-to-Cash, Interim Management, and other major strategic and operational improvement initiatives.  

Terry is the author of a new book by McGraw-Hill, Global KATA: Success Through the Lean Business System Reference Model™.  

 

Please feel to visit Terence's website www.ceobreakthrough.com, or follow him on Twitter, or LinkedIn, or contact him directly at burton@ceobreakthrough.com

BTOE_Awards_Long_Ad.png


Expand Knowledge with Proqis Business Transformation & Operational Excellence Events

Welcome to BTOES Insights, the content portal for Business Transformation & Operational Excellence opinions, reports & news.
Subscribe to Business Transformation & Operational Excellence Insights Now

Featured Content

  • Best Achievement of Operational Excellence in Technology & Communications: IBM
  • Best Achievement of Operational Excellence in Oil & Gas, Power & Utilities: Black & Veatch
  • Best Achievement in Cultural Transformation to deliver a high performing Operational Excellence culture: NextEra Energy
    
Official Media Partner: Business Transformation & Operational Excellence World Summit
Operational Excellence Frameworks and Learning Resources, Customer Experience, Digital Transformation and more introductions
Business Transformation & Operational Excellence World Summit - BTOES17 - Watch the highlights now!
The Business Transformation & Operational Excellence Awards 2018

EXCLUSIVE CONTENT

Operational Excellence: Snapshots Full Series

Download the Exclusive 6 in 1 report series on BTOES Insights FREE Now!

Download content

For instant access to more exclusive content, just click the previews below.

  • Intelligent BPM Systems: Impact & Opportunity
  • Surviving_the_IT_Talent_deficit.png
  • Six Sigma's Best Kept Secret: Motorola & The Malcolm Baldrige Awards
  • The Value-Switch for Digitalization Initiatives: Business Process Management
  • Process of Process Management: Strategy Execution in a Digital World