Lean or Innovation? Wrong Question!

The only difference between lean and innovation is where you point your energy

I get the question all the time, especially from organizations that have significant investment in some process improvement program—like a lean Six Sigma or lean kaizen initiative. (I hear the ghosts of Toyota engineers booing.) These companies have picked all the low-hanging fruit, squeezed as much inefficiency from their work as is humanly feasible, and are now realizing that their beloved program wasn’t all that market-focused. All that internal scrutiny left the customer without any new and useful value.

These organizations are realizing they must focus on what they should have been focusing on all along: companywide innovation.

The question comes in different forms. Often it sounds something like this:

“What’s the difference between lean and innovation?”

“Will an innovation effort clash with our lean program?”

These are the wrong kinds of question. They’re indicative of the wrong mindset. You hear it in the language, “We’re doing lean,” and “We’ve been doing lean for three years.” You don’t “do” lean. Do you “do” innovation? When was the last time you heard someone say, “We’ve been doing innovation for three years?” Geez, what did you do before?

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Systems Perspective

Dear Mr. May,

There was an excellent conversation between Dr. Russell L. Ackoff and Dr. W. Edwards Deming that addresses this topic from a systems perspective -- http://youtu.be/2MJ3lGJ4OFo. And, I think the reader needs a systems perspective to differentiate between improving quality and innovating solutions to new demands.

The existing system is geared to solve a particular problem. It may not function at optimal capability. That's where improvements to the system through improvement of its processes will boost its performance e.g. by removing waste; reducing variability. The productivity of the system will increase. It will do more with the same resources. But, it is basically still solving the same problem it was designed for. The system's aim hasn't changed.

It's important to note that the system itself resides within a larger environment: the market. And market demands change over time. The problem the system was designed to solve evaporates with the evolution of market demands to be replaced with new problems. So improving the performance of the existing system is a waste of resources. The manner in which this waste is eliminated is to change the aim of the system to solve the new problems it confronts.

Dr. Deming drew this system's view on a chalk board for the Japanese 50+ years ago. And, Dr. Ackoff added to it with his own ideas of systems thinking in the 1970s and 80s. Many of us are still struggling to fully comprehend the big picture they painted as we get mired in the weeds of lean and six sigma. We've lost sight of the system's aim and its place within the greater system it belongs to.

Hopefully this has added to the point you were trying to make.

All the best, Shrikant Kalegaonkar (Twitter: @shrikale, LinkedIn: http://www.linkedin.com/in/shrikale/)