Quick Fixes Don't Deliver Success in a Lean Transformation

The general consensus is few companies that try lean are truly lean, even after decades of effort, says Jerry Solomon, recently retired from his role as vice president of operations at MarquipWardUnited.

One glaring reason is those companies forget "the most important pillar of lean, which is respect for people."

But Solomon also advances another possible reason: Perhaps the most important – or complex – elements of a lean transformation are put off too long in favor of quick wins.

Take lean product development, for example. Solomon describes lean product development as "absolutely critical."

"But companies wait a long time before they do this. Ditto for hoshin. These elements are all encompassing and very complex and generally are not addressed until way down the lean journey when the results are not as expected and people are frustrated. Instead companies have been doing the relatively easy stuff such as 5S, set-up reduction, TPM," which focus primarily on the factory floor, he says.

Solomon puts lean accounting in the same category as hoshin and lean product development in terms of breadth and complexity.

Solomon, a strong proponent of lean accounting, defines it as an accounting system that meets the needs of all customers, which includes tax authorities as well as internal customers such as manufacturing. Moreover, it is consistent with and supportive of a firm's operational strategy.

Put plainly, it's financial statements in plain English, he says. And that fosters greater respect for people.

"[Lean accounting] provides accurate, timely and understandable information to motivate the lean transformation," Solomon says.

Yet it's not widespread, even among companies pursuing lean. The retired MarquipWardUnited executive suggests several reasons why, including the fact that it focuses on managerial accounting "which is of little interest to the corporate finance people," and because it is not perceived as a way to reduce costs.

Solomon also notes companies that show success with lean -- like Lantech, Wiremold, Toyota and MarquipWardUnited for example -- have finance people who recognized the importance of accounting to support a lean journey.

"When companies start out on the journey, they want quick fixes, quick benefits," he says.

Yet a lean transformation also requires heavy lifting.