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Kaizen Principles: Foundation on which the transformation takes place

Guiding principles that help in learning to think Lean

Principle refers to the People’s way of thinking. It is also called mindset.

These Principles are the starting point for Kaizen (Changing for the Better) and are embedded in all the tools; they form the very foundation on which the Kaizen transformation takes place.

Kaizen Principle 1

Below given are the five principles which has to be kept in mind before you start any Kaizen/Lean/Operational/Manufacturing excellence journey:

  1. Create customer value
  2. Eliminate waste
  3. Engage People
  4. Go to gemba
  5. Manage improvements


Create Customer Value

Customer value = Utility – Price (Utility includes Products & Service Quality)

  • Market In: ‘Market In’ is customer focus to
    • factually understand customers QCD needs
    • anticipate and understand customer’s unstated wants & needs
  • The next operation is customer
    • Every operation has customer & suppliers
    • Who are my internal customers?
    • How do my customers use my input?


  • Never pass muda, waste or problems onto the next process:
    • Don’t accept
    • Don’t make
    • Don’t pass on
  • Upstream management
    • Find the problems
    • Solve the problems
    • Avoid/Prevent problems

Kaizen Principle 2

Eliminate Waste

Company value = Price – Cost Waste increases cost and diminishes value. Therefore it is very important to focus on deletion, systematic improvement, value stream structure & pull based.

  • Focus on MUDA: Any activity customer is not ‘Prepared’ to pay for!
    • If you eliminate non value added activities the lead time will reduce and you will get higher flexibility, less stocks, better service, reduced complexity, less cost & improve freshness.
  • Total system optimization: Stresses on integration of total system & appreciates all critical factors.

 functional VS total system 3

Value stream organization

  • Value stream organization is opposite to functional organization
  • Functional organization divides, isolates, creates waste, conflict & inefficiency
  • Value stream organization integrates & appreciates all critical factors
  • There are no isolated autonomous systems – everything affects everything else
  • Pull Flow thinking
    • Pull means that no upstream should produce a good or service until the customer (downstream) asks for it.
    • Pull system reduces the lead time
    • Pull system requires focus on reduction in setup time to enable quick changeover

Engage People

Provide clear objectives at all level. Coach and empower. Develop leadership.

Kaizen Flag 4

  • Welcome problems
    • Where no problems is perceived, there can be no improvement
    • Problems are mountain of treasures
    • People are not problems
    • Increase people capability to solve problem: make people problem solver
  • No Blaming
    • Traditional blaming
      • Judges after the fact
      • Let’s ‘who-is-wrong’ override ‘what-is-wrong’
      • Drives people into defensive positions
      • Submerges issues for years
      • Creates crisis orientation

Therefore focusing on the issue or problem, not on the person, creates an open, trusting, communication rich environment. Blaming VS Leadership 5 Go To GEMBA

Gemba is a Japanese word which means ‘The Real Place’. Gemba refers to the place where value is created; in manufacturing the Gemba is the factory floor. It can be any “site” such as a construction site, sales floor or where the service provider interacts directly with the customer. In lean manufacturing, the idea of gemba is that

  • the problems are visible,
  • and the best improvement ideas will come from going to the gemba.
  • an activity that takes management to the front lines to look for waste and opportunities to practice gemba kaizen, or practical shop floor improvement.

Golden rules of Gemba

  • When an abnormality occurs, go to gemba first
  • Check with Gembutsu (machine, material, failures, rejects, unsafe conditions etc.)
  • Take temporary countermeasures on the spot
  • Remove root cause
  • Standardize to prevent trouble

Manage the transformation

Three things to be kept in mind to manage transformation

  • Focus on process and results
    • Inconsistent process gives inconsistent results
    • Ignoring the processes reduces the chances of desired results
    • While quality processes gives quality results
    • Traditional thinking says ‘I don’t care how you do it, just get it done’. (Results only thinking)
    • People work on processes; Processes create results; Results cannot be changed; Improve process to get improved results;
  • PDCA/SDCA approach

Kaizen Principle 6

  • Visible processes/problems

Visual Management is displaying information. It helps us

  • To depict
    • Parameters
    • Trends
    • Strategic data
  • To show and control process
  • To identify and mark
    • Hazards
    • Reference points
    • Standards

Change thinking- change Environment- change habits – change culture

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative. Looking for more info on Kaizen/Lean/Operational Excellence? Click here

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Announcing specialized training programs

november Training

Based on the feedback from our clients, Kaizen College is pleased to announce its public training programs 

Kaizen college is the executive education & training arm of Kaizen Institute. It operates worldwide at different locations.

We have announced these programs across three cities (Bengaluru, New Delhi and Vadodara) for the month of November.

november Training

The objective of these programs is to support participants enhance their skill sets through contemporary practical learning experiences.

Since its a small group training program, only a limited number of participants will be admitted on first come first serve basis. We may limit the number of participants from the same company if we receive more applications than the maximum number of participants. You can confirm your participation personally or nominate your representative/s for the program by sending the duly filled registration forms.

For further details or to download the brochure & registration form, you may please visit in.kaizen.com or click here

We look forward to your cooperative & participative response

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Time to change paradigms

Mind is a “pattern seeking mechanism”. Our mind gets conditioned – but once conditioned, its difficult to reshape. Learning to Unlearn is most important


A paradigm is a way of thinking (based on values and beliefs, and reinforced by standards, habits and results) which influences our way of interpreting a given situation or problem. When we react to a situation in a stereotyped or usual way this is called a paradigm.Each person reacts according to the paradigms adopted.

Paradigms usually stands a long period of time until something occurs to bring into question the validity of the model.

What is CHANGE?

Change means “to cause to be different”. Change begins with acceptance.

We resist change because we fear

  • Fear of failure
  • Creating new habit
  • No obvious need
  • Loss of control
  • Concern about support system
  • Coming out of comfort zone
  • Closed mind
  • Unwilling to learn
  • Fear of personal impact
  • Fear about new way
  • Fear of unknown

Looking at current scenario you all must have noticed that there is a huge resistance to change or changing the paradigms as people think:

  • “We’ve always worked that way”
  • “At first, I cared, but …”
  • “It’s not my responsibility”
  • “No-one told me”
  • “I don’t have the time”
  • “Anyway, it wouldn’t change anything”
  • “Another gizmo which won’t last”
  • “There are more important problems”
  • “It’s not possible here”
  • “We already have enough work”
  • “What’s in it for me?”

5 Stages of change transition

5 Stages of change transition

Individual prerequisites for change to occur

Individual prerequisites for change to occur

Observations of Paradigms

It has been found that Paradigms are common – regional, religious, personal, professional etc.,Paradigms are essential – they give us guidelines, rules & regulations. “My Paradigm is THE Paradigm!” – more of a Warning than an observation. Largely, an outsider brings a shift in a paradigm and One needs lots of courage & conviction to bring a shift in a paradigm

Common management paradigms

Managerial technology is secondary!

Set policy and results will follow!

Train employees and Gemba improves!

Rely on sophisticated tools instead of Gemba tools!

Believes Gemba will ask “What is in it for me?”!

Quality is quality manager’s job!

Efficiency is industrial engineer’s job!

Cost cutting, not cost management (muda elimination)!

KAIZEN without focus and targets!

Do not go to Gemba!

The process of change – Gemba Kaizen Activities

The process of change – Gemba Kaizen Activities

But why do we need “CHANGE”

In a jungle in Africa every morning a lion wakes up and thinks he has to RUN “Faster” than the

“Slowest” Zebra, in order to SURVIVE.In the same jungle every morning…..….a zebra wakes up and thinks he has to RUN “Faster” than the “Fastest” Lion, in order to SURVIVE.

…so it does not matter whether YOU are a Lion Or a Zebra, when the Sun is up, you need to RUN ….For SURVIVAL


YOU ARE AT WAR …..every  day , every moment , every second

BUT…is running enough ????

How to change the company culture?

People have Paradigms that are made of “Values and Habits”;Results are a consequence of the current “Values and Habits”;Values are related to Mind (what i think)…Habits are related to Gemba (what i do)…To change a Paradigm it is necessary to Change Gembas and to Change Minds…

  • Way to Change Gembas:
    • Do GK – Gemba Kaizen workshops;
    • GK will break old habits and consolidate new ones with Visual Standards;
    • Start Value Stream Projects in Model Areas;
    • Do 5S, SDCA and PDCA at all levels.
    • Continuous Gemba deployment (at the right speed of change).
  • Way to Change Minds:
    • Education and Training.
    • Benchmark (perceive better Gembas);
    • Gemba Kaizen Workshop Training (if you desire to see learn how to act);
    • Read, develop a Vision and exercise the Power of Will;
    • Continuous Education and Training (at the right speed of change).

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

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Freedom from darkness

Harish Hande doesn’t care about electrifying India, he wants the solar lamp to transform this country. Of course he was pleasantly surprised when newly appointed Prime Minister Narendra Modi said he would back the growth of solar power so that every household in India has at least one lamp by 2019, but Hande has also observed, for the last 15 years or so, that the ministry of new and renewable energy unfailingly gets a new secretary every six months. “Some don’t feel it’s an attractive post, some are quickly shifted, some retire,” he says with the air of a veteran who has figured out how to make things work despite policymakers.

freedom from darkness

But these are all relatively minor niggles. Hande, 47, won the Ramon Magsaysay Award in 2011 because the ideas at Selco (Solar Electric Light Company—India), the solar energy equipment supplier company he co-founded in 1994, shine brighter than the lights it sells to the poor.

Take, for instance, Selco’s Light For Education project whose participants include around 30,000 children in Karnataka. Solar panels are installed on school premises and the battery, about the weight of a lunch box, is given to children. Children charge the batteries when they come to school. If they don’t come to school, there’s no light at home. “We stole the idea from the midday meals scheme,” says Hande. Stole and innovated.

Or the way Selco tackled the unique problem faced by a community of poor drum-makers in Bangalore. They were willing to pay for solar power, but they had one condition. They were often evicted, with only 15-20 minutes to gather their belongings. Could Selco design a system they could run with? No problem, a design school graduate who works at Selco conjured up a solar system on a cart.

Around 1.2 billion of the world’s population doesn’t have access to reliable electricity, and 400 million of these people live in India. Hande, who jokes that while growing up, his bread and butter came from a coal-fired plant in Rourkela (his father worked in power distribution at the Steel Authority of India), understood early that coal and gas wouldn’t be enough to meet India’s growing energy needs.

Yet, as an energy engineering student at the Indian Institute of Technology, Kharagpur, and a doctoral student at the University of Massachusetts, US, Hande’s interest in solar was restricted to its supply security dynamic (the sun as a source of energy is limitless) and its environmental impact. Until a visit to the Dominican Republic in 1991 taught him a new lesson in thermodynamics. He saw the poor paying for solar lights and realized that renewable energy could be a catalyst for social change. So he spent the next two years in Sri Lanka and India—in darkness.

He took time off to see how communities in both these countries lived without electricity. “I realized I didn’t know what happens after 6pm. We were just making decisions based on Excel sheets,” he says. He learnt a few things: The moment you don’t know a language (Sinhalese), the artificial hierarchies of a formal education crumble and you are treated like anyone else; none of his formal education was useful, except perhaps the confidence he had gained by living in a hostel. In Sri Lanka especially, communities came together after dark, usually in Buddhist temples, to vent their frustrations; in India, the lost time was usually spent in isolation and the kerosene lamp made people even more depressed. “It was my most efficient period of time, I joke,” he says. That’s also probably when he realized that the poor don’t want sympathy. They want partners and collaborators.

He worries about the hierarchies he believes English-speaking India imposes on the rest of the country. He knows he may not be able to influence the thinking of a top dog at a Bangalore-based research firm who asks him how he ever manages to have “intellectual discussions” in rural India. Or the suit who eagerly shares that his children “teach” their rural counterparts every weekend. But he hopes he can someday convince urban children to partner with fellow Indians who don’t speak their lingo. “How do I tell kids that we are all part of the same society? That they need to learn from each other to create some sort of social equity? How to make kids interested in solving problems?”

Selco gets hundreds of internship applications from masters’ and PhD students every year but very few are Indians. Of the 300 applications last year, five were from this country. “I’ve now resorted to guilt-tripping parents and students when I speak to them. In the next 10 years if you complain that Americans and Europeans know more about India than you do, then you are to blame, I tell them,” Hande says

“How do I tell kids that we are all part of the same society? That they need to learn from each other to create some sort of social equity?”

At Selco at least, they try to break these barriers. Nearly 85% of Selco’s employees, including chief operating officer Mohan Hegde (a practising folk artist on weekends), come from rural India. Hegde and K. Revathi, president, have been running the company since 1 June when Hande retired as managing director to take charge of the Selco Foundation, the company’s think tank. All the brainstorming for solutions and innovations to help fight poverty takes place at the foundation. The business side executes the ideas and the company’s incubation cell teaches entrepreneurs how to replicate these successes across India (four projects are already under way in Manipur, Rajasthan, West Bengal and Madhya Pradesh; Selco is helping 25 more entrepreneurs raise funds).

Formal qualifications are not a prerequisite for any job at Selco. Twenty-eight-year-old Raghu, who greets me when I arrive and gets us tea at the Selco office in Bangalore, started out as a driver and now handles administrative duties. “He’s going to be a branch manager by the time he’s 32. That’s our goal for him,” says Hande. In rural areas they joke about Selco’s hires: Are you part of the laptop or the non-laptop crowd?

Hande checks all the boxes of someone who truly believes in sustainability. He doesn’t own any asset, he says he has about three-four pants and shirts, he borrows his father’s 1994 Maruti 800 when he needs a car, and his daughter Adhishri was 8 when she first started saying: “Is it needed or is it wanted?”

He got his cues from mentors like Neville Williams, his co-founder and a solar energy pioneer who made it to the CIA watch list after a trip to Vietnam to protest the “American War”; from photographer Jon Naar, who was a British spy in World War II; and from Paul Maycock, who predicted way back that the cost of producing solar energy would plunge by 2015. “These are guys who talked about sustainability in a very different manner. I miss their passion. Now you go to a meeting and it’s all about ties and suits.”

Hande sees the poor as asset creators, and not as a bottom of the pyramid sales opportunity. “Don’t sell to the poor. That’s our fundamental rule. And if you’re selling to the poor, make sure that the value you’re giving to the poor is much more than the monetary value they give you back,” he says.

So when Selco representatives found that 32 Sidi families in rural Karnataka spent more money annually on candles, kerosene and to charge their mobile phones than it would cost to set up a simple solar system, they had to fix this. No bank was willing to lend the money to these families, so Selco offered a 100% guarantee on their behalf. Six months later, the bank reduced this guarantee to 20% as the payments were regular. “The best response was from the Sidis,” says Hande. “They said, light is great but once the solar loan is done, I will take a loan for a sewing machine.” They had become bankable.

Acknowledgement: Mr. Harish Hande

This article was published in livemint August 2014 (www.livemint.com)

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

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Clean India Movement & 5S

If there is a ranking of countries in respect of observance of STANDARDS of sanitation and hygiene, one can be sure that India would figure close to the bottom. Some time ago, a British MP, Lucy Ivimy, was reported to have said that Indians did not know how to dispose of their rubbish and are congenital litterbugs.

From time to time, in their unguarded moments, highly placed persons in advanced industrial countries have burst out against Indians for being filthy and dirty in their ways of life. A majority of visitors to India from those countries complain of “Delhi belly” within a few hours of arrival, and some fall seriously ill.

There is no point in getting infuriated or defensive about this. The general lack of cleanliness and hygiene hits the eye wherever one goes in India — hotels, hospitals, households, workplaces, railway stations, trains, airplanes and, yes, temples. Indians think nothing of spitting whenever they like and wherever they choose, and living in surroundings which they themselves make unlivable by their dirty habits. (Source: The Hindu Businessline)

“5S” is a reference to five words starting with letter S, for the basic elements of this system. Seiri (Sort), Seiton (Set in Order), Seiso (Shine), Seiketsu (Standardize) and Shitsuke (Self-discipline). One can also term these are 5 pillars of self organization or an effective workplace. We term it pillar because it supports the improvement structure. 5S is the starting point for any Continuous Improvement initiative. It is the DNA.

The 5S approach is universal and simple. The principle is same whether you apply this in a Foundry or in a Hospital. Without practising 5S, one cannot do quick changeovers, cannot maintain Just-in-time inventory system, or cannot practice Autonomous Maintenance.

The general myth pertaining to 5S is that 5S is practised only to give a cosmetic up-lift to the workplace. 5S is more than a good looking place. With changing demands of customers, one is forced to find new ways to ensure survival. To do this, a change in the mind-set or shift in paradigm is essential. A change in mind-set is influenced by the change in the physical environment. Thus, 5S facilitates the shift in the paradigms and paves way for improvement. 5S also creates an awareness of Non-value adding activities present in the processes.

Another myth is 5S is a step-by-step methodology. But, this is not! All the 5 pillars are to be practised together and not in isolation. One can observe that the first 3 pillars are Gemba oriented. However, without Standardization and Self-discipline, no Continuous Improvement Initiative would sustain.


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Blue Ocean Leadership : Part III of III

Execution Is Built into the Four Steps

Any change initiative faces skepticism. Think of it as the “bend over—here it comes again” syndrome. While blue ocean leadership also meets such a reaction initially, it counters it by building good execution into the process. The four steps are founded on the principles of fair process: engagement, explanation, and expectation clarity. The power of these principles cannot be overstated, and we have written extensively about their impact on the quality of execution for over 20 years. (See, for example, our article “Fair Process: Managing in the Knowledge Economy,” HBR July–August 1997.)

Blue ocen leadership

In the leadership development context, the application of fair process achieves buy-in and ownership of the to-be Leadership Profiles and builds trust, preparing the ground for implementation. The principles are applied in a number of ways, with the most important practices being:

  • Respected senior managers spearhead the process. Their engagement is not ceremonial; they conduct interviews and draw the canvases. This strongly signals the importance of the initiative, which makes people at all levels feel respected and gives senior managers a visceral sense of what actions are needed to create a step change in leadership performance. Here’s a typical employee reaction: “At first, I thought this was just one of those initiatives where management loves to talk about the need for change but then essentially goes back to doing what they’ve always done. But when I saw that leading senior managers were driving the process and rolling up their sleeves to push the change, I thought to myself, ‘Hmm…they may just finally mean it.’”
  • People are engaged in defining what leaders should do. Since the to-be profiles are generated with the employees’ own input, people have confidence in the changes made. The process also makes them feel more deeply engaged with their leaders, because they have greater ownership of what their leaders are doing. Here’s what people told us: “Senior management said they were going to come and talk to people at all levels to understand what we need our leaders to do and not do, so we could thrive. And I thought, ‘I’ll believe it when someone comes knocking on my door.’ And then they knocked.”
  • People at all levels have a say in the final decision. A slice of the organization across the three management levels gets to vote in selecting the new Leadership Profiles. Though the top managers have the final say on the to-be profiles and may not choose those with the most votes, they are required to provide a clear, sound explanation for their decisions in front of all attendees. Here’s some typical feedback: “The doubts we had that our comments were just paid lip service to were dispelled when we saw how our inputs were figured into the to-be profiles. We realized then that our voices were heard.”
  • It’s easy to assess whether expectations are being met. Clarity about what needs to change to move from the as-is to the to-be Leadership Profiles makes it simple to monitor progress. The monthly review meetings between leaders and their direct reports help the organization check whether it’s making headway. We’ve found that those meetings keep leaders honest, motivate them to continue with change, and build confidence in both the process and the sincerity of the leaders. By collecting feedback from those meetings, top management can assess how rapidly leaders are making the shift from their as-is to their to-be Leadership Profiles, which becomes a key input in annual performance evaluations. This is what people say: “With the one-page visual of our old and new Leadership Profiles, we can easily track the progress in moving from the old to the new. In it, everyone can see with clarity precisely where we are in closing the gap.”

Essentially, the gift that fair process confers is trust and, hence, voluntary cooperation, a quality vital to the leader-follower relationship. Anyone who has ever worked in an organization understands how important trust is. If you trust the process and the people you work for, you’re willing to go the extra mile and give your best. If you don’t trust them, you’ll stick to the letter of the law that binds your contract with the organization and devote your energy to protecting your position and fighting over turf rather than to winning customers and creating value. Not only will your abilities be wasted, but they will often work against your organization’s performance.

Becoming a Blue Ocean Leader

We never cease to be amazed by the talent and energy we see in the organizations we study. Sadly, we are equally amazed by how much of it is squandered by poor leadership. Blue ocean leadership can help put an end to that.

The Leadership Canvases give people a concrete, visual framework in which they can surface and discuss the improvements leaders need to make. The fairness of the process makes the implementation and monitoring of those changes far easier than in traditional top-down approaches. Moreover, blue ocean leadership achieves a transformation with less time and effort, because leaders are not trying to alter who they are and break the habits of a lifetime. They are simply changing the tasks they carry out. Better yet, one of the strengths of blue ocean leadership is its scalability. You don’t have to wait for your company’s top leadership to launch this process. Whatever management level you belong to, you can awaken the sleeping potential of your people by taking them through the four steps.

Are you ready to be a blue ocean leader?

Acknowledgement: By Chan Kim, Renee Mauborgne

This article was published in Harvard Business Review May 2014

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

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IndiZEN – 6th National Convention on Operational Excellence

India has a great diversity in the maturity levels within different industries. There are certain industries which are mature and many are still at the stage where they are driving Operational Excellence (OE) in bits & pieces. In a way they are driving OE or continual improvements, but they are not really driving them in a way it should be.


Too often the greatest challenge faced by the Operational Excellence Managers is “Sustaining Change”. This happens because of lack of focus on Daily Work Management practices or SDCA approach or misunderstandings or general resistance to change. It is not unusual for improvement efforts to disappear.  Therefore sustaining change or operational excellence plays a crucial role in Continual Improvement journey. Leaders at every level in the organization must continue to demonstrate their commitment & visible leadership to sustain change so that whatever improvements happen do not disappear.

We present & invite you to IndiZEN 2015, 6th National Convention on Operational Excellence where you can Learn more about the “Sustained Operational Excellence – Key to Long Term Success of ‘Make In India”, Share your learnings & experience & Network with like minded people. IndiZEN 2015 is going to be the place to learn about the ways to sustain operational excellence. You will gain insights on how you can become an active learning organization and build the capability of your people by engaging their hearts & minds.

Block your dates, be there to learn & find the real key to Sustainability.

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

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Blue Ocean Leadership : Part II of III

The Four Steps of Blue Ocean Leadership

Now let’s walk through how to put blue ocean leadership into practice. It involves four steps:

  1. See your leadership reality.

A common mistake organizations make is to discuss changes in leadership before resolving differences of opinion over what leaders are actually doing. Without a common understanding of where leadership stands and is falling short, a forceful case for change cannot be made.

Achieving this understanding is the objective of the first step. It takes the form of what we call as-is Leadership Canvases, analytic visuals that show just how managers at each level invest their time and effort, as perceived by the customers of their leadership. An organization begins the process by creating a canvas for each of its three management levels.

A team of 12 to 15 senior managers is typically selected to carry out this project. The people chosen should cut across functions and be recognized as good leaders in the company so that the team has immediate credibility. The team is then broken into three smaller sub teams, each focused on one level and charged with interviewing its relevant leadership customers—both bosses and subordinates—and ensuring that a representative number of each are included.

The aim is to uncover how people experience current leadership and to start a companywide conversation about what leaders do and should do at each level. The customers of leaders are asked which acts and activities—good and bad—their leaders spend most of their time on, and which are key to motivation and performance but are neglected by their leaders. Getting at the specifics is important; the asis canvases must be grounded in acts and activities that reflect each level’s specific market reality and performance goals. This involves a certain amount of probing.

At a company we’ll call British Retail Group (BRG), many interviewees commented that middle managers spent much of their time playing politics. The subteam focused on that level pushed for clarification and discovered that two acts principally accounted for this judgment. One was that the leaders tended to divide responsibility among people, which created uncertainty about accountability— and some internal competitiveness. The result was a lot of finger-pointing and the perception that the leaders were playing people against one another. The subteam also found that the leaders spent much of their time in meetings with senior management. This led subordinates to conclude that their leadersnwere more interested in maximizing political “face time” and spinning news than in being present to support them. 1

After four to six weeks of interviews, sub team members come together to create as-is Leadership Profiles by pooling their findings and determining, based on frequency of citation, the dominant leadership acts and activities at each level. To help the sub teams focus on what really matters, we typically ask for no more than 10 to 15 leadership acts and activities per level. These get registered on the horizontal axis of the as-is canvas, and the extent to which leaders do them is registered on the vertical axis. The cap of 10 to 15 prevents the canvas from becoming a statement of everything and nothing.

The result is almost always eye-opening. It’s not uncommon to find that 20% to 40% of the acts and activities of leaders at all three levels provide only questionable value to those above and below them. It’s also not uncommon to find that leaders are under investing in 20% to 40% of the acts and activities that interviewees at their level cite as important.

At BRG, the canvas for senior managers revealed that their customers thought they spent most of their time on essentially middle-management acts and activities, while the canvas of middle managers indicated that they seemed to be absorbed in protecting bureaucratic procedures. Frontline leaders were seen to be focused on trying to keep their bosses happy by doing things like deferring customer queries to them, which satisfied their desire to be in control. When we asked team members to describe each canvas in a tagline, an exercise that’s part of the process, they labeled the frontline Leadership Profile “Please the Boss,” the middle manager profile “Control and Play Safe,” and the senior manager profile “Focus on the Day-to-Day.” (For an example, see the exhibit “What Middle Managers Actually Do.”)

The implications were depressing. The biggest “aha” for the sub teams was that senior managers appeared to have scarcely any time to do the real job of top management—thinking, probing, identifying opportunities on the horizon, and gearing up the organization to capitalize on them. Faced with firsthand, repeated evidence of the shortcomings of leadership practices, the sub teams could not defend the current Leadership Profiles. The canvases made a strong case for change at all three levels; it was clear that people throughout the organization wished for it.

  1. Develop alternative Leadership Profiles.

At this point the sub teams are usually eager to explore what effective Leadership Profiles would look like at each level. To achieve this, they go back to their interviewees with two sets of questions.

The first set is aimed at pinpointing the extent to which each act and activity on the canvas is either a cold spot (absorbing leaders’ time but adding little or no value) or a hot spot (energizing employees and inspiring them to apply their talents, but currently underinvested in by leaders or not addressed at all).

The second set prompts interviewees to think beyond the bounds of the company and focus on effective leadership acts they’ve observed outside the organization, in particular those that could have a strong impact if adopted by internal leaders at their level. Here fresh ideas emerge about what leaders could be doing but aren’t. This is not, however, about benchmarking against corporate icons; employees’ personal experiences are more likely to produce insights. Most of us have come across people in our lives who have had disproportionately positive influence on us. It might be a sports coach, a schoolteacher, a scoutmaster, a grandparent, or a former boss. Whoever those role models are, it’s important to get interviewees to detail which acts and activities they believe would add real value for them if undertaken by their current leaders.


To process the findings from the second round of interviews, the subteams apply an analytic tool we call the Blue Ocean Leadership Grid (see the exhibit by the same name). For each leadership level the interview results get incorporated into this grid. Typically, we start with the cold-spot acts and activities, which go into the Eliminate or Reduce quadrants depending on how negatively interviewees judge them. This energizes the subteams right away, because people immediately perceive the benefits of stopping leaders from doing things that add little or no value. Cutting back on those activities also gives leaders the time and space they need to raise their game. Without that breathing room, a step change in leadership strength would remain largely wishful thinking, given leaders’ already full plates. From the cold spots we move to the hot spots, which go into the Raise quadrant if they involve current acts and activities or Create for those not currently performed at all by leaders.

With this input, the sub teams draft two to four “to-be” canvases for each leadership level. These analytic visuals illustrate Leadership Profiles that can lift individual and organizational performance, and juxtapose them against the as-is leadership profiles. The sub teams produce a range of leadership models, rather than stop at one set of possibilities, to thoroughly explore new leadership space.

  1. Select to-be Leadership Profiles.

After two to three weeks of drawing and redrawing their Leadership Canvases, the sub teams present them at what we call a “leadership fair.” Fair attendees include board members and top, middle, and front line managers.

The event starts with members of the original senior team behind the effort describing the process and presenting the three as-is canvases. With those three visuals, the tea establishes why change is necessary, confirms that comments from interviewees at all levels were taken into account, and sets the context against which the to-be Leadership Profiles can be understood and appreciated. Although the asis canvases often present a sobering reality, as they did at BRG, the Leadership Profiles are shown and discussed only at the aggregate level. That makes individual leaders more open to change, because they feel that everyone is in the same boat.


With the stage set, the sub teams present the tobe profiles, hanging their canvases on the walls so that the audience can easily see them. Typically, the sub team that focused on frontline leaders will go first. After the presentation, the attendees are each given three Post-it notes and told to put one next to their favorite Leadership Profile. And if they find that canvas especially compelling, they can put up to three Post-its on it.

After all the votes are in, the company’s senior executives probe the attendees about why they voted as they did. The same process is then repeated for the two other leadership levels. (We find it easier to deal with each level separately and sequentially, and that doing so increases voters’ recall of the discussion.)

After about four hours everyone in attendance has a clear picture of the current Leadership Profile of each level, the completed Blue Ocean Leadership Grids, and a selection of to-be Leadership Profiles that could create a significant change in leadership performance. Armed with this information and the votes and comments of attendees, the top managers convene outside the fair room and decide which to-be Leadership Profile to move forward on at each level. Then they return and explain their decisions to the fair’s participants.

At BRG, more than 125 people voted on the profiles, and fair attendees greeted the three that were selected with enthusiasm. The tagline for frontline leaders’ to-be profile (opposite page) was “Cut Through the Crap.” (Sadly, this was later refined to “Cut Through to Serve Customers.”) In this profile, frontline leaders did not defer the vast majority of customer queries to middle management and spent less time jumping through procedural hoops. Their time was directed to training frontline personnel to deliver on company promises on the spot, resolve customer problems, quickly help customers in distress, and make meaningful cross-sales—leadership acts and activities that fired up the frontline workers, were sure to excite customers, and would have a direct impact on the company’s bottom line

“Liberate, Coach, and Empower” was the tagline for middle management’s to-be profile (above). Here leaders’ time and attention shifted from controlling to supporting employees. This involved eliminating and reducing a range of oversight activities—such as requiring weekly reports on customer calls received and funds spent on office supplies—that sapped peo-knowple’s energy and kept frontline leaders at their desks. The profile also included new actions aimed at managing, disseminating, and integrating the knowledge of frontline leaders and their staff. In practical terms, this meant spending much more time providing face-to-face coaching and feedback.


The tagline for the to-be profile of senior management (above) was “Delegate and Chart the Company’s Future.” With the acts and activities of front line and middle managers reset, senior managers would be freed up to devote a significant portion of their time to thinking about the big picture—the changes in the industry and their implications for strategy and the organization. They would spend less time putting out fires

The board members who attended the leadership fair felt strongly that the to-be Leadership Profiles supported the interests of customers as well as shareholders’ profit and growth objectives. The frontline leaders were energized and ready to charge ahead. Senior managers went from feeling towed under the waves by all the middle-management duties they had to coordinate and attend to, to feeling as if they could finally get their heads above water and see the beauty of the ocean they had to chart.

The trickiest to-be Leadership Profile was middle management’s. Letting go of control and empowering the people below them can be tough for folks in this organizational tier. But the to-be Leadership Profiles of both frontline and senior management helped clear the path to change at this level.

  1. Institutionalize new leadership practices.

After the fair is over, the original sub team members communicate the results to the people they interviewed who were not at the fair.

Organizations then distribute the agreed-on tobe profiles to the leaders at each level. The sub team members hold meetings with leaders to walk them through their canvases, explaining what should be eliminated, reduced, raised, and created. This step reinforces the buy-in that the initiative has been building by briefing leaders throughout the organization on key findings at each step of the process and tapping many of them for input. And because every leader is in effect the buyer of another level of leadership, all managers will be working to change, knowple’s ing that their bosses will be doing the same thing on the basis of input they directly provided.

The leaders are then charged with passing the message along to their direct reports and explaining to them how the new Leadership Profiles will allow them to be more effective. To keep the new profiles top of mind, the to-be canvases are pinned up prominently in the offices of both the leaders and their reports. Leaders are tasked with holding regular Monthly meetings at which they gather their direct reports’ feedback on how well they’re making the transition to the new profiles. All comments must be illustrated with specific examples. Has the leader cut back on the acts and activities that were to be eliminated and reduced in the new Leadership Profile? If yes, how? If not, in what instances was she still engaging in them? Likewise, is she focusing more on what does add value and doing the new activities in her profile? Though the meetings can be unnerving at first—both for employees who have to critique the boss and for the bosses whose actions are being exposed to scrutiny—it doesn’t take long before a team spirit and mutual respect take hold, as all people see how the changes in leadership are positively influencing their performance.

Through the changes highlighted by the to-be profiles, BRG was able to deepen its leadership strength and achieve high impact at lower cost. Consider the results produced just at the frontline level: Turnover of BRG’s 10,000-plus frontline employees dropped from about 40% to 11% in the first year, reducing both recruitment and training costs by some 50%. The total savings, including those from decreased absenteeism, amounted to more than $50 million that year. On top of that, BRG’s customer satisfaction scores climbed by over 30%, and leaders at all levels reported feeling less stressed, more Energized by their ability to act, and more confident that they were making a greater contribution to the company, customers, and their own personal development.

Keep watching this space to read Part III of this subject.

Acknowledgement: By Chan Kim, Renee Mauborgne

This article was published in Harvard Business Review May 2014

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

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Blue Ocean Leadership : Part I of III

What’s the reason for the widespread employee disengagement? According to Gallup, poor leadership is a key cause.

Blue Ocean Leadership

Most executives—not just those in America—recognize that one of their biggest challenges is closing the vast gulf between the potential and the realized talent and energy of the people they lead. As one CEO put it, “We have a large workforce that has an appetite to do a good job up and down the ranks. If we can transform them—tap into them through effective leadership—there will be an awful lot of people out there doing an awful lot of good.”

Of course, managers don’t intend to be poor leaders. The problem is that they lack a clear understanding of just what changes it would take to bring out the best in everyone and achieve high impact. We believe that leaders can obtain this understanding through an approach we call “blue ocean leadership.” It draws on our research on blue ocean strategy, our model for creating new market space by converting noncustomers into customers, and applies its concepts and analytic frameworks to help leaders release the blue ocean of unexploited talent and energy in their organizations—rapidly and at low cost.

The underlying insight is that leadership, in essence, can be thought of as a service that people in an organization “buy” or “don’t buy.” Every leader in that sense has customers: the bosses to whom the leader must deliver performance, and the followers who need the leader’s guidance and support to achieve. When people value your leadership practices, they in effect buy your leadership. They’re inspired to excel and act with commitment. But when employees don’t buy your leadership, they disengage, becoming noncustomers of your leadership. Once we started thinking about leadership in this way, we began to see that the concepts and frameworks we were developing to create new demand by converting noncustomers into customers could be adapted to help leaders convert disengaged employees into engaged ones.

Over the past 10 years we and Gavin Fraser, a Blue Ocean Strategy Network expert, have interviewed hundreds of people in organizations to understand where leadership was falling short and how it could be transformed while conserving leaders’ most precious resource: time. In this article we present the results of our research.

Key Differences from Conventional Leadership Approaches

Blue ocean leadership rapidly brings about a step change in leadership strength. It’s distinct from traditional leadership development approaches in several overarching ways. Here are the three most salient:

Focus on acts and activities. Over many years a great deal of research has generated insights into the values, qualities, and behavioral styles that make for good leadership, and these have formed the basis of development programs and executive coaching. The implicit assumption is that change in values, qualities, and behavioral styles ultimately translate into high performance.

But when people look back on these programs, many struggle to find evidence of notable change. As one executive put it, “Without years of dedicated efforts, how can you transform a person’s character or behavioral traits? And can you really measure and assess whether leaders are embracing and internalizing these personal traits and styles? In theory, yes, but in reality it’s hard at best.”

Blue ocean leadership, by contrast, focuses on what acts and activities leaders need to undertake to boost their teams’ motivation and business results, not on who leaders need to be. This difference in emphasis is important. It is markedly easier to change people’s acts and activities than their values, qualities, and behavioral traits. Of course, altering a leader’s activities is not a complete solution, and having the right values, qualities, and behavioral traits matters. But activities are something that any individual can change, given the right feedback and guidance.

Connect closely to market realities. Traditional leadership development programs tend to be quite generic and are often detached from what firms stand for in the eyes of customers and from the market results people are expected to achieve. In contrast, under blue ocean leadership, the people who face market realities are asked for their direct input on how their leaders hold them back and what those leaders could do to help them best serve customers and other key stakeholders. And when people are engaged in defining the leadership practices that will enable them to thrive, and those practices are connected to the market realities against which they need to perform, they’re highly motivated to create the best possible profile for leaders and to make the new solutions work. Their willing cooperation maximizes the acceptance of new profiles for leadership while minimizing implementation costs

Distribute leadership across all management levels. Most leadership programs focus on executives and their potential for impact now and in the future. But the key to a successful organization is having empowered leaders at every level, because outstanding organizational performance often comes down to the motivation and actions of middle and frontline leaders, who are in closer contact with the market. As one senior executive put it, “The truth is that we, the top management, are not in the field to fully appreciate the middle and frontline actions. We need effective leaders at every level to maximize corporate performance.”

Blue ocean leadership is designed to be applied across the three distinct management levels: top, middle, and frontline. It calls for profiles for leaders that are tailored to the very different tasks, degrees of power, and environments you find at each level. Extending leadership capabilities deep into the front line unleashes the latent talent and drive of a critical mass of employees, and creating strong distributed leadership significantly enhances performance across the organization.

Keep watching this space to read Part II & III of this subject.

Acknowledgement: By Chan Kim, Renee Mauborgne

This article was published in Harvard Business Review May 2014

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

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Managing Change, One Day at a Time: To change culture Change habits

At a client’s off-site meeting a few years ago, I gave a talk on how companies can bring about dramatic cultural change—the focus of my firm’s consulting work. At the end, a man quietly approached and asked, “Are you a friend of Bill’s?” Seeing my confused expression, he attempted a clarification: “Are you a friend of Bill W’s?” “Who’s Bill W?” said. The man explained that Bill Wil on was the founder of Alcoholics Anonymous and that members use the question “Are you a friend of Bill’s?” to discreetly inquire about whether acquaintances are in AA. “I’m not,” I replied. “Why do you ask?” He said that the methods I’d described to lead change reminded him of the methods AA uses to help people stop drinking—so much so that he’d wondered if I was a 12-stepper myself. I thought it was an interesting exchange but gave it no further thought at the time.

Managing Change, One Day at a Time

Soon afterward a senior executive at another client told me that the process we’d used to coach his team had inspired him to confront his alcohol abuse—even though we hadn’t, of course, discussed addiction during the coaching. This made me curious. So over the past several years, my team and I studied a variety of addiction treatment programs. We examined the methods and success rates of traditional 12- step programs along with less conventional techniques, from the regimen depicted on the TV show The Biggest Loser to therapies for troubled youth and training protocols for orca whales. We approached the endeavor with skepticism—on the surface, change management and addiction treatment seem wholly dissimilar. Over time, however, we saw many parallels between how the two bodies of work leverage human nature to modify behavior. In the process, we discovered a provocative lens and language to help change managers better understand their mission and methods.

At the simplest level, the comparison is this: Organizations can’t change their culture unless individual employees change their behavior—and changing behavior is hard. Many change programs focus on providing strategies, technologies, and training. But often that’s not enough. When it comes to modifying deeply ingrained behavior, 12-step programs have a superior track record. They use incentives, celebration, peer pressure, coaching to adopt new habits, negative reinforcement, and role models—things organizations can draw on.

Analogies are never perfect, and there are clearly points where the comparison doesn’t hold. For instance, AA relies heavily on spirituality, asking participants to put their faith in a higher power and to declare themselves powerless—sentiments that are generally not appropriate for driving corporate change. Still, in our work with clients including eBay, Dow Chemical, Accenture, AOL, and Lincoln Financial, we have found the comparison useful. Even people who have never attended a 12-step program know some of the basics from pop culture portrayals; making the similarities to corporate change explicit, as in the insights below, can help them understand the challenges of changing an organization’s culture and how to overcome them.

Nothing happens without a readiness to change. John Kotter, the preeminent change management expert, has written: “People don’t change a minute before they’re ready.” In the AA canon, “hitting rock bottom” is often the catalyst, but for companies, change readiness doesn’t require failure. Sometimes a leader’s admission of vulnerability helps others recognize and address their failings (think of the sharing done in AA meetings). You can’t force people to change—you can only help them want to. AA’s process recognizes this truth; few managers do.

KMS - Managing change

It’s important to replace old habits with new ones. Many former smokers chew gum or toothpicks. AA serves coffee to give attendees a beverage in place of the ones they’ve given up. In change management, the goal is to replace negative habits with positive ones. At one restaurant chain, store managers used to begin the day by going over the numbers from the previous shift. Although analyzing numbers isn’t inherently bad, it is an isolating behavior, usually done in an office with the door closed—and data alone often don’t explain why sales went up or down. So we helped managers start the day with a different routine: talking with crew members to learn whether anything unusual had happened on the previous shift and only then going through the numbers. This increased managers’ understanding of business conditions and boosted employee engagement— and sales rose.

Peer support and pressure drive change. One of the best ways to change human behavior is to gather people with similar problems together. This was first recognized in 1905 by the Boston physician Joseph Pratt, who organized groups for tuberculosis patients that emphasized the need for rest, fresh air, and proper nutrition. Over the past century research has shown that support groups benefit people with a wide range of medical and psychological conditions. In our work we find that bringing employees together in peer groups to discuss change initiatives can create accountability, mutual generosity, a judgment-free attitude, and increased pressure on reluctant employees to change.

Sponsorship deepens commitment and sparks results. AA pairs experienced members, or sponsors, with newcomers for one-on-one support; research has shown that these role model relationships increase both parties’ ability to stay sober. The corporate version, called peer coaching or mentorship, has been widely embraced: For example, 70% of Fortune 500 companies use it with their salespeople. We find that identifying and celebrating early adopters of the behaviors a company wants to instill can create positive contagion. Pairing these role models with slower-to-adopt colleagues can be far more effective than coaching by outside experts.

Community without hierarchy is a catalyst for change. AA is famous for its organizational structure, in which local groups are self-directed. Addiction specialists sometimes raise concerns that groups without therapists or other formal leaders lack professionalism, but research has shown that this structure increases members’ security, comfort, and sense of mutuality in the relationships they form. Corporations will always require a hierarchy, but peer role models can successfully lead projects within a change initiative.

You are the company you keep. Studies have shown that people with a close friend or relative who drinks heavily are 50% likelier to be heavy drinkers themselves. That is why AA discourages members from associating with their old drinking pals. Similarly, having an obese friend increases one’s own chances of becoming obese, and a person’s income can be estimated by averaging the income of his or her five closest friends. This knowledge can guide change managers, who should evaluate the ROI of helping particular employees to change in light of those employees’ potential to get others to follow suit. In our work we strive early on to identify influential employees; this can be as simple as asking workers which of their colleagues are informal leaders. Often it’s possible to leverage this influence in subtle ways: For example, by changing where employees sit, you can seed influentials throughout the organization.

Continuous introspection is key. Early on in the AA program, members examine their past behavior and start trying to change. AA talks about continuously taking a moral inventory; we see this in effective corporate change initiatives as well. In the wake of the global financial crisis and General Motors’s bankruptcy filing, for example, the company practiced that kind of deep introspection, found its behavior wanting, and drew on its experience in total quality management to improve its relationships with dealers. Before the crisis, GM had managed those relationships by relying heavily on checklists, specifications, and mandated actions. Now it promised and demonstrated a new focus on listening and collaboratively solving problems as a trusted adviser to its dealers (who are, in the industry’s model of franchised dealerships, part of its customer base), and it achieved better solutions and increased buy-in. The new approach is proving helpful as the company deals with recent recalls.

Changes in practice may represent breakthroughs. In the AA program, a profound transformation occurs when a participant shifts from an emotional framework of guilt, shame, remorse, and resentment toward a more positive, optimistic mind-set. But “mind-set” is hard to measure, and minds are hard to change; therefore, in our work we focus on identifiable shifts in practice. We coach new practices or habits that emphasize growth rather than cost-cutting, for example, or that grow profitability rather than revenue. When you spot such a shift, celebrate it; it’s an important marker of progress.

It pays to acknowledge small wins. AA doesn’t ask members never to drink again—that goal would probably seem unreachable. It asks them not to drink that day, and it recognizes small milestones by awarding “sobriety coins,” usually monthly, for periods of abstinence. Change managers should take a lesson from this practice and find ways for employees to demonstrate and celebrate incremental achievements. One of the biggest reasons corporate transformations fall short, according to Kotter, is that managers fail to “systematically plan for, and create, short-term wins.”

The goal is progress, not perfection. Ninety percent of recovering alcoholics relapse at some point. That’s hardly surprising: The newly sober are bombarded with sensory cues that their brains associate with their addiction—the smell of beer, the sound of glasses clinking in a toast. In organizations, too, change doesn’t always follow a straight line. However, this is an area where we diverge from many 12-step programs: Unlike AA, which takes away all a member’s sobriety coins as penalty for any relapse, we coach people to overcome setbacks and move forward to the next win. Celebrating the reversal of a relapse can help desired behaviors regain momentum.

CHANGE IS HARD—particularly when the situation involves chemicals the body craves. Neuroscience has shown that people’s emotional responses to work create their own chemical reactions, releasing powerful neurotransmitters such as adrenalin, dopamine, and serotonin. Successful change can be addictive in a positive way. No matter how habituated employees are to established business practices, they can adapt to new ways of working.

 Acknowledgement: Keith Ferrazzi

This article was published in Harvard Business Review

P.S. If your leaders and colleagues are also interested in this subject, do them a favor and share this link. They may thank you for your concern and initiative.

Looking for more info on Kaizen/Lean/Operational Excellence? Click here