If less than 1% of companies are successful with Lean

I have seen numerous times where Dr. Jeffrey Liker prominent author of the Toyota Way Series has claimed that less than 1% of companies are successful with Lean. I am not sure what criteria he bases this number on exactly but if he is even close why are we doing it? If you have studied Lean and any of Dr. Deming’s material, it would say  it’s the process not the people. Therefore, would we not have to say this failure is the process not the organization? So, if Lean has this high of failure rate why are we doing it?

When I ask this question of many “Lean” people they have a tendency to answer the question based on why companies are not successful. I never intended to ask this question to beat up on the companies trying to implement Lean. They have a tough enough job. Many will point to leadership saying that they are at fault. Truth be known, they are responsible. That is why we call them leaders. But if I am a leader and something is only having a 1% success rate, why am I going to go down that path? Why would I contemplate Lean?

The fact is that Lean, Six Sigma, TQM and many methodologies work. The fact is most weight-loss programs work. The problem is most people; most organizations don’t master them to make them successful. As Dan Pink said, “Mastery is hard.” Hence, less than 1% of companies are successful with Lean or even something as simple as a weight loss program. You can find plenty of advice; you can read books, go to seminars and enroll in programs. I am not against professional advice mind you; they have experience and knowledge that you may not have in your organization. But this is where your plan may break down. Look at all your diet plans for example, why do they stop working? It’s you, not the plan.

What does work is the same thing for both people and organizations. It is the scientific process of trial and error. You don’t get it right at first, you have to break habits, personal habits as an individual and company cultures as an organization. Successful companies do it a little bit at a time. In Lean, we call this scientific method PDCA. We plan, do it, check the results and adjust. It is a purposeful experimentation.

To me, this is the excitement of Lean, is this empowering aspect that is not easy. You teach people, rather than solve people’s problems for them. And in doing so, they learn how to make better decisions which leads to better performance.

Dr. Michael Balle stated in an interview with me, “Lean gives you an ideal; it’s a commitment to an ideal.” More importantly, you must understand your own organization, the culture that exist and the culture that your customers expect and are willing to derive value from. You have to make the process your own. You have to rid yourself of Lean or other business processes. Dr. Liker’s statement is exactly correct because successful companies that started down a Lean path are not Lean anymore, only the unsuccessful ones are. If you are successful at implementing Lean, it is simply not Lean. It’s yours.

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13 Replies to “If less than 1% of companies are successful with Lean”

  1. “If less than 1% of companies are successful with Lean, why are we doing it?”

    Lots of us are not.  I would say the efforts I see “fail” are because they don’t do it.  They have something they call TQM, six sigma, lean or whatever and try out 5% of it is some half measures with big doses of Dilbert’s pointy haired boss methods and then don’t get great results.  Wow.

    The biggest complaint (with some merit) I see is why is lean/Deming/six sigma… so hard to actually do.  If companies constantly fail to do it at all (even when they use the name) isn’t that an issue.  Isn’t that a weakness of the “solution.”  My answer is: YES.  The caveat is, until someone comes up with the management system that both gets the results Deming can and is super easy for organizations to actually adopt whole heatedly and have great success I know of nothing better than trying to do these things.

    My belief is that a partial success rate is much higher than 1%.  While many organization never go beyond slapping a few good tools on a outdated management system those few tools actually have good results.  Maybe 50% of the implementations are so lame they have minimal success at all (not even getting improvement worth the time and effort) – could be seen as “failures” to me.  Those that actually have a right to say they are practicing “lean” I would say is a pretty small number but still above 1%?

  2. I have to agree, not sure what Dr. Liker means by the <1% number – but what is a failure? If my ideal weight loss is 20 pounds and I lose 10, did I fail to implement the program totally? Am I considered one of those less than 1% failures?

  3. Lean requires a culture change.  I suspect that less than one percent of ANY culture change is successful.  It has nothing to do with Lean; culture change of any kind is almost never suceessful.

  4. I agree with you but should there not be a more successful way. Why choose a path if your chances are less than 1%? What do you do as a manager?

  5. If it was easy, everyone would be doing it.

    Lean is too much work because it makes people accountable for fixing these problems that surface. It’s easier for a middle manager to let his employees deal with suboptimal processes, as long as he doesn’t have to do extra work. In order to fix the process, the manager has to put some thought into how to fix it, but he’s already got a full workload fighting daily fires.

    So, top management has this great idea to implement Lean and save money, but middle management pushes back because it’s too hard and creates extra work. Since lean is about saving money, of course, why would we add resources to help them out?

  6. Not sure, I totally agree. Middle Managers are stuck in the middle.

    My question to you is why do it if that is the case? Are all companies successful that have implemented Lean?

  7. What I recall Jeff Liker saying was that less than 2% of auto suppliers are “truly lean” or “really lean,” something like that.

    In this podcast, he talks about the difference between “talking lean” and “actually doing it.”

    My understanding is that he’s setting the bar VERY high, meaning that you have a culture like Toyota or at least that sort of cultural commitment.

    http://podcast.leanblog.org/2006/08/leanblog-podcast-3-dr-jeffrey-liker_27/

    Does not being fully lean equal “failure?” On some level yes, but on many levels no.

    Hospitals… probably 2% are “actually doing it,” ala ThedaCare, Virginia Mason, and a few others. Does that mean the others that are doing tactical things like reducing infections, reducing waiting times, cutting some costs, are “failures” because they aren’t on the level of a Toyota yet?

    Even ThedaCare would say they’re not on the level of a Toyota.

    Does that mean people should stop pursuing, practicing, and learning more about lean? Of course not.

  8. Thanks for update Mark. i like your interpretation much better than the way I initially took what he said. This was about 18 months ago, so my recollection is a little fuzzy also.

    The only two points, I was hoping to achieve was that Lean is not easy and you have to take ownership for it to work.

    Joe

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