Chapter 2

The Transformation Framework

Introduction

To build an organization that will last, people must possess certain behavioral characteristics that are deeply embedded. It’s useful to think of any transformation as having two key dimensions: technical and social. The technical side includes tools and methods, many of which have been adapted to the IT space. ¹ In some ways, this part of the transformation is more accessible and inviting to organizations. People love tools, as they raise the promise of immediate action and commensurate results. Tools involve doing something that we usually equate with change for the better—often a faulty assumption based on emotions and hopeful aspirations. Technology is what we do; IT is especially vulnerable to looking to tools and technology as a silver bullet for organizational problems. Unfortunately, the typical positive impact of introducing a new tool is a temporary illusion at best.

Tools have a place in a transformation, to be sure, but they do not normally change people’s behaviors or thinking patterns!

The social side of a lean IT transformation is less tangible and quite illusive. Most of us know when we are working on a team with a dynamic culture of trust, transparency, professional challenge, and accomplishment where great results seem to come naturally, albeit with struggle. But very few people can actually explain why some cultures are so effective and others are absolutely toxic. “We need a new culture around here!” is a proclamation we hear often when working with organizations interested in adopting lean IT practices and the results they enable people to achieve.

The social side (people side) of a lean IT transformation is the behavioral and thinking piece of the puzzle. Companies have been trying to figure this one out for a very long time. In this chapter, we’ll share a model framework we apply throughout this book—a house that shows the building blocks of a lasting transformation. Although the house metaphor is overused, we couldn’t resist! Lean IT is all about building an effective IT organization, and the quality of the components used in building it make a huge impact on its stability and effectiveness. The house is a simple way to illustrate that lean IT is a system of many parts working together in unison.

The ideas in this book are based on years of trial and discovery of the sequenced steps to building a sustainable lean system. In other words, we have experienced many setbacks along the way that, upon reflection, check, adjust, and try again, have in some cases led to a better understanding of what really works. We still have much to learn but what we have discovered is reflected in the framework we are sharing with you. If you are a lean practitioner, you’ll notice that many of the IT-based examples in this book can be effectively adapted to apply to all areas of your organization.

The Lean IT House

Let’s take a look at the building blocks of our house (Figure 2.1).

Foundation

Perhaps the most common mistake we see is organizations attempting to make the leap from where they currently are to a more stable, capable, and productive workplace without first establishing a solid base from which positive change will flourish. In the foundation, key elements are identified that need to be in place in order to provide an environment in which enterprise excellence becomes a deep-seated organizational habit.

Align Purpose

The keystone of a solid transformation is a clearly defined, understood, and continually reinforced purpose. In many organizations, there is no shared definition or understanding of why the company exists. Mission statements become dusty, ignored plaques hanging on walls, and rarely translate into a shared aim throughout the business. ² Purpose is frequently a loosely understood and individually applied underpinning of why we do the work we do. But when purpose is aligned, everyone in the organization can clearly answer the questions, “Why do we exist as an organization?” and “How does my work contribute to our goals?”

Improve Process

The work you do can and should be viewed as a process: Inputs are received, effort transforms something (product, service, information), and outcomes are passed on. We often see great people living by heroic efforts, contending with broken processes, and getting mediocre results. Many people have come to normalize and accept work processes that are ineffective, inefficient, laden with non-value-adding tasks, and utterly frustrating. What is clearly lacking in most work environments (and surely in IT) is a method to clearly understand work processes and improve them!

Respect People

Respect for people, at a personal, one-to-one level, plays a key role in building a culture of excellence. Most organizations list respect as one of their core values. This is admirable, but the behavior exhibited by the vast majority of companies is in fact the very opposite. A key component of respect for people ³ is developing common problem-solving skills at all levels of the organization—leaders, managers, and associates. Unseen leaders, command-and-control management decrees, vague goals, conflicting priorities, concealed problems, distrust, and gossip are all vivid examples of not respecting people! In our opinion, accommodating broken work processes as tolerable is perhaps one of the most disrespectful acts we can take!

Problem Solving

Most people will tell you problem solving is what they do all day: deal ing with whatever issues come their way and doing whatever it takes to fix them. The problem here lies with autonomy, skill set, and overburden. People often don’t have clarity of purpose and don’t possess effective problemsolving skills or have enough slack time to notice obstacles until they become too large to easily solve. When they are that large, no one has time to solve them because they are overworked. It’s a cruel cycle that is difficult to break.

An amazing insight is that, in practically every company we have visited, there is no shared problem-solving method! When people encounter a problem or improvement opportunity, they resort to a variety of methods including asking the boss, brainstorming, asking the 5 Whys, ⁴ starting an A3, ⁵ fishbone diagramming, ⁶ voting, selecting a similar problem from their past and repeating their response, or just plain guessing! When a shared routine of how we face, frame, understand, and address problems is present, the time to implement countermeasures and assess their impact is significantly reduced. At the end of the day, effective widespread problem solving drives organizational learning.

Culture of Accountability

We often hear people complain, “There’s no accountability around here!” After spending years observing people doing their work and interacting with one another, we often see the same thing. So what fosters accountability? In organizations where personal responsibility and follow-through are common practice, we see a very distinct environment: one with significant differences in the areas of respect, trust, sense of common purpose, appreciation of process, standard work, shared problem solving, and visual management. It is these foundational elements which combine to support a culture of shared accountability.

The First Pillar: Associates—Where Value Is Created

The front line is where value ⁷ is created. In IT, we are talking about business analysts, developers, database analysts (DBAs), service desk techs, operations people, infrastructure architects, maintenance techs, and all other members of the delivery stream. Anyone who directly contributes to the development, implementation, operation, maintenance, and use of technology supports the flow of information, products, and services.

The first pillar consists of three behaviors that support a culture of excellence at the front line: create value, identify problems and opportunities, and improve work processes. Let’s briefly look at them now and see how they are applied later on.

Behavior 1—Create Value

The essence of doing good work is the creation of value. The essence of doing the right work is the creation of customer value. When associates know what good work looks like, and work standards are aligned to customers’ needs and expectations, great things happen.

When IT work is viewed with a product rather than a service mentality, an amazing shift occurs. Why? Because when you shift your perspective toward delivering a product rather than a service, customer value becomes the focal point. For product-focused organizations, it is clear what customer value is, because customers buy what they value and ignore what they don’t! For service-focused areas of the business, customer value is not so evident and they are often characterized as a cost center.

Here, the emphasis shifts to the pursuit of efficiency and cost control (often the stated goal of IT) while not giving much attention to deliberate value creation. This focus misses the whole point of lean and value creation.

In today’s world, IT plays a central role developing, delivering, and supporting products that deliver value to customers. The key here is getting people in IT to understand the value they create. This can be challenging when IT staff are far removed from the customer—something you can remedy by having your staff spend more time with customer-facing end users or, better still, your end customers.

Behavior 2—Identify Problems and Opportunities

Edwards Deming said, “You can’t improve what you do not measure.” Measurements play a critical role in determining whether people are achieving targets. But unless we create an environment where identifying problems and opportunities is expected, safe, and welcomed, we will be relegated to a relentless cycle of reactive firefighting that typifies many IT shops. People need to know if they are winning or losing and if life is ever going to get better!

So much of the work that takes place in IT is undocumented, ad hoc, and performed in ways determined by the person performing the work, that it might be hard to envision standard work in all that complexity. When standard work is not the norm, everyone performs work according to their understanding of what needs to be accomplished and of how things should be done, resulting in high variability of quality and productivity.

The essence of standard work ⁸ is to move away from people doing work their way (based on individual opinion and experience) to everyone working in a more consistent fashion. When everyone on the team abides by the standard, we begin to intentionally impact variability. Standard work serves as a snapshot of what good work looks like and a baseline from which improvement can happen.

There is a common misperception that standard work hinders creativity. But the real purpose of standard work is to make repeatable work routines much more predictable and less burdensome, freeing time up for the creativity and thinking bandwidth essential for more challenging tasks. Standard work also introduces trust and discipline as common behaviors in any team. The term discipline often conjures up images of marching in single file or doing push-ups, but the discipline we’re talking about is the shared agreement that team members will honor the process. It turns out that adhering to the current standard (until a better way is found) is a shared behavior found within all organizations that have successfully transformed their culture.

Behavior 3—Improve Work Processes (through Daily Kaizen)

Kaizen is a Japanese term meaning Change for the Good and is often used to describe continuous improvement activities. Most kaizen activity we see in the workplace is project based. ⁹ Projects are a great way to get started, to introduce tools and principles, and to carve out time for improvement, but there’s a catch. The challenge with project-based kaizen is that it lacks the immediacy and emphasis of on-the-spot problem solving done in real time (as in right now). By their very nature, projects have a beginning, a middle, and an end. True kaizen does not have an end point and is continuous! The whole idea of continuous improvement is that it is unceasing and without end!

It is common that people learn lean methods and tools in a project-based setting (e.g., “Let’s do an improvement project on Service Desk procedures!”). Although there is nothing inherently wrong with learning while working on a project, the transition from project-based work to daily improvement has many deep-seated barriers, both internal and external.

Our Project-Based Paradigm

Individually, we all view our work from a certain perspective. For example, if the majority of your work is reactive in nature (responding to emergencies and frequently switching tasks), then you are likely to view how good you are at doing your job by your ability to nimbly jump from issue to issue, quickly refocus, and take immediate action. Your personal paradigm toward work may not embrace the need for a deeper level of understanding cause-and-effect relationships or the value of developing countermeasures that go beyond attacking symptoms. Project-based improvement efforts reinforce this viewpoint because “there is simply no time to make improvement during my busy workday.” After the kaizen project is complete, we go back to work and ostensibly suspend all improvement work!

The urgency and drama of the workplace often encourage reactive behavior, which places more importance on immediate action than it does on lasting results. If we can put out the fire today, we’ll worry about tomorrow’s problems when they come. And when we recognize and award heroic efforts and results at any cost, that is behavior we cultivate and encourage.

Improvement efforts that are exclusively project-based reinforce this reality and fortify reactive behavior.

Daily kaizen refers to the common practice of stopping when someone encounters a problem, swarming to see and understand, thinking and acting to deeply understand and improve, and sharing to broadcast the learning. ¹¹ There is no boundary between doing work and improving work, so improvement is done continuously throughout the workday as problems and opportunities are encountered.

When frontline staff view their work in terms of value creation, actively look for problems and opportunities for improvement, and embrace an established cadence of daily problem solving, expectations become transparent and behaviors evolve to a new common norm. Over time, the shared actions, values, and beliefs of the team begin to change.

The Second Pillar: Leadership—Where Alignment Is Cultivated

Leaders—C-level executives, directors, and managers—either actively promote alignment of purpose through a value stream perspective or unwittingly encourage disorder among departments and functions. A value stream comprises all the people, activities, departments, and hand-offs necessary to create and deliver value to the customer (be it a product, service, or information). In IT, vertical silos often focus exclusively on their specific segments of the IT value stream to the detriment of the overall flow of value to the customer.

Frontline associates focus primarily on the vertical work in front of them and within their circle of control: their department, their team, and their piece of the work product. In order to generate improvement at the value-stream level, leadership is needed to coordinate efforts horizontally among various departments to achieve positive change that is experienced by end customers. Value stream management is much easier to describe than it is to successfully execute. When leaders move from managing functional silos to managing value streams, the inherent contradictions between the goals of each silo and the objectives of the organization become blatantly apparent!

It’s not easy to shift from a localized focus of your functional area (e.g., infrastructure, security, project management). But effective leadership is more about supporting and coaching the development of people than about making proclamations and issuing orders. To do this well as a leader, you have to broaden your perspective.

Behavior 1—Set Direction

Strategy is about envisioning a future state and devising ways to reach it that will weather predictable as well as unforeseeable challenges. In a transformation, it is essential for leaders to position continuous process improvement as a central component of how to endure the obstacles that certainly lie ahead. A good strategy answers the question, “What are the most important things in this organization?” When daily continuous process improvement is absent from the strategic intent of leaders, a strong message is sent concerning the lack of priority and importance of embedding applied learning into daily work. People become conditioned to know when another program or initiative has arrived and learn that this too shall pass.

Newsflash: people think about and do what their boss talks about and does most often! Strategy can be intentional and deliberate or emergent and ad hoc. When strategy (and measurements) include key initiatives, budgets, project schedules, and operational performance, but fail to comprise targeted improvement of core business processes, few if any resources are allocated toward building a culture of enterprise excellence. It is the role of senior leadership, with the input of management, to articulate and reinforce a shared direction.

When strategy deployment ¹² is measured and tracked, time and resources are allocated toward process improvement. This sends a clear message to people that the company is serious about continuous improvement and that it is here to stay. Be careful here: The goal is to create a culture of experimentation and alignment. This is not measured by number of kaizen events or inflated reports of improvement benefits. ¹³ See Chapter for a discussion of strategy deployment.

Behavior 2—Model Ideal Behaviors

We’ve all heard the familiar phrase, actions speak louder than words. Leaders and managers communicate what is really important (and what is not) by the behaviors they demonstrate. It’s great to talk about the importance of respect for people, continuous improvement, and commitment to operational excellence, but only consistent behavior will convince people that the transformation is real and here to stay!

People tend to model their actions based on values, beliefs, and work systems. Values and beliefs are unique, personal, and internally ingrained. We don’t need to go there! Attempting to change someone’s values is ill advised and probably futile. When thought leaders model actions and conversations we want prevalent in our workplace, people tend to gravitate toward new behaviors. Thought leaders are people of influence and not exclusively leaders and managers. In fact, the most influential thought leaders are often associates who consistently model ideal behavior while achieving great results.

When work systems are adjusted to drive ideal behaviors, culture begins to shift and a new normal begins to emerge. This takes years of relent less effort and learning: think 5 to 7 years or more. As you work through this field guide, you will be building the core work systems that influence behaviors to reinforce a culture of respect, engagement, and continuous improvement.

Behavior 3—Coach and Develop People

The development of people is perhaps the most essential factor in creating and sustaining a lean transformation and even more so in an IT environment. IT professionals often equate professional development with learning new technical skills such as mastering a new application or programming language. While this is a form of people development, the type of growth we are referring to here has more to do with problem solving, communicating, and effectively working within a team.

In order for people to learn new skills, they require training, the opportunity to practice, and a coach to support their progress. Of the lean transformations we have seen that under-deliver and stall out, 100% have included training, fewer have made adequate time to practice new skills, and none have done an adequate job of developing internal coaches to nurture people as they develop new ways of thinking and acting. Coaching is a learned skill but often we find inadequate training and support for internal coaches. One organization we worked with had a saying: “Everyone shall have a coach, and everyone will be a coach!” The intent of that edict was to make it clear that, without trained, capable coaches, the transformation was going nowhere.

Visual Management

A visual management system plays a key role in creating transparency in the workplace and aligning all levels of the organization. An effective visual management system clearly answers questions such as

• What are we currently working on?
• Are we completing our work on time?
• What is important today?
• What does success look like?
• Right now, are we winning or losing as a team?
• What are the challenges and struggles we are currently facing (quality, flow, delivery, safety, etc.)?
• What continuous improvement actions are in flight?
• What is the extent of problem solving in our team?

A visual management system ensures these questions are being asked and that the answers are understood at every level of the organization. The biggest impact of a visual management system is the promotion of meaningful communication between leaders, managers, associates, and departments. The outcome is an alignment of focus and behavior leading to great results from great behaviors. Much more on this topic can be found in Chapter 7.

Metrics

Imagine watching a sporting event without a scoreboard—pretty boring wouldn’t you say? People need feedback to understand if the work they are doing is moving them toward a meaningful goal or not. Providing actionable feedback is spot-on respect for people. Meaningful, actionable metrics connect behavior with results and supply predictive indicators to make thoughtful course corrections. Without measurements, it isn’t possible to assess performance or the impact of a change.

A central element of effective continuous process improvement is a common framework for problem solving. Perhaps the most accessible and widespread problem-solving method is the Plan–Do–Check–Adjust (PDCA) ¹⁴ problem-solving cycle. This structured approach to solving problems is at the same time easy to understand and deceptively difficult to execute. I cannot check and adjust if I do not know whether a change is in fact an improvement. Measurements and standards help in this regard.

Peter Drucker ¹⁵ said, “What gets measured gets managed.” That’s usually true, but perhaps an equally important point is, “Are we managing the right things?” Measurements drive behavior. If we measure things that are outside the direct control of the people being measured, we are wasting their time and disrespecting them. A feeling of helplessness can emerge as hope dims and disengagement becomes the team norm. As you will see, metrics and measuring the right things is more a process of discovery than it is an exact science.

Reflection

Careful evaluation of our work performance, our interactions, our potential growth, our actual progress, and ourselves as human beings is the final component of our house. The Japanese term used to describe this activity is hansei, ¹⁶ which relies on self-awareness and personal assessment as a process of self-improvement. Reflection requires courage to be honest about our weaknesses and humility to get comfortable with our blind spots and shortcomings. We can only improve those aspects of ourselves that we acknowledge need improvement!

The purpose of reflection is to honestly assess what characteristics of our behavior worked and what didn’t work, and to act accordingly. This is similar to the Plan–Do–Check–Adjust cycle in that we must rigorously check our behavior, performance, and results to truthfully identify what needs to change. Like PDCA, on the surface this sounds very straightforward and simple. In practice, this is brutally difficult to accomplish!

Let’s Get Started! Your Roadmap

A key factor of a successful journey is an effective map. A map helps keep you on course and safe when you might otherwise stray into uncharted and dangerous territory. To help you on your journey, we’ve created a roadmap for you to guide your path: this book! It will give concrete advice on how to get started building and sustaining your transformation. Like any map, it doesn’t have all the answers. You’ll hit roadblocks, detours, and also wonderful discoveries on the way. But, it will provide a starting point and a heading to come back to time and again to check whether you are making progress toward your destination.

The lean IT house highlights the concepts we’ll explore as well as emphasizes the relevant building blocks you’ll need. We hope that by giving you a conceptual map at the start, you’ll have a mental model to lead a successful lean IT transformation. Let’s begin!

Notes