Applying modern manufacturing ‘lean production’ principles to ‘knowledge work’
Could modern manufacturing ‘lean production’ principles be applied to ‘knowledge work’? If they could, the implications in terms of efficiency, cost reduction, reduced duplication and drudgery would be great - not to mention the potential for reducing professional fees and opening up knowledge to broader audiences.
Conventional wisdom is that the thoughtful work of lawyers, consultants, software engineers, creative directors, et al cannot be reduced to best practice formulas, and this has rather closed down the debate. Now some new research has cast fresh light on this subject, suggesting that ‘lean’ production principles long deployed in manufacturing can in fact make a valuable contribution to increasing the efficiency of workers in the ‘knowledge’sector.
Professor David Upton of Saïd Business School, University of Oxford and Assistant Professor Bradley R Staats of Kenan-Flagler Business School, University of North Carolina set out their findings in Lean Knowledge Work in the October 2011 issue of Harvard Business Review.
“Attempts to apply lean principles to knowledge work have proved frustratingly difficult” says Professor Upton. “Unlike manufacturing, the work is not repetitive and easily defined and often relies on knowledge locked inside the individual’s head. But our research shows that such work can benefit from lean production principles in a number of ways. Even in the most creative areas of their work, we have found that creating rules and systems to guide workers can lead to more effective collaboration and to significant benefits for the organization, such as faster response times, higher quality and creativity, lower costs, and reduced drudgery and frustration for individuals leading to greater job satisfaction.”
Staats and Upton gathered detailed field data from almost 2000 knowledge-intensive software projects, and also studied knowledge workers in a range of other creative settings. Using this empirical data, they were able to sift through the vast array of oft-quoted principles of lean operations, and hone in on those that worked – and delivered genuine performance improvements - using an evidence-based, scientific approach for knowledge-based settings. The authors summarize six of these principles:
Knowledge workers experience considerable waste in terms of delays, duplication of effort, inadequate communication and inefficient systems. Routine activities such as printing documents, requesting information from others and waiting for people to join meetings unnecessarily eat up the valuable time of creative individuals. The authors encourage firms to continually root out waste and to keep asking ‘why’ – why am I attending this meeting, why am I writing this report, why am I standing at the printer, why do we do it this way. Instead of assuming the system is right, assume it is wrong. Instead of solving the same problems over and over again, create standard solutions wherever possible and train people to apply them, so more time can be devoted to real creative work.
2 Strive to make the tacit knowledge explicit
While lots of knowledge work relies on judgment or intuition, not all of it does and some can be captured in a protocol with no reduction in the quality of the work. Knowledge firms assume that many tasks cannot be standardised, but the research indicates that a surprisingly high amount can be specified. Once it has been defined in this way, it can be improved, and it can be taught to others. One Japanese bank, for example, found they could specify many of the steps in lending decisions for home mortgages and automated the vast majority of cases, leading to increased growth and reduced risk. Such approaches allow knowledge workers to spend more time on the parts of the job where they create most value, and derive most satisfaction. “Organizations can expect scepticism and resistance from skilled workers when efforts are made to capture their expertise in this way” comments Professor Staats. “So it is important that firms explain the benefits to individuals of freeing them for more interesting work, and reassure them of their ongoing value to the organization.” Articulating what people do, and how and why they do it, enables the organization to learn, to exploit best practices and transfer knowledge across the organization, all of which contribute to its competitive advantage.
3 Specify how workers should communicate
An important step in building a leaner organization is to define who should be communicating, how often, and what they should be saying in relation to any given project. Knowledge workers need to appreciate who needs and will use their information so the recipients do not waste time uncovering what they need to know. The research demonstrates how this is particularly important for companies working across cultures, whether with colleagues or external contacts.
4 Solve problems quickly and consistently
The authors show how a systematic approach to problem solving can bring sizeable benefits. They advocate defining an explicit proposal about how an aspect of work could be improved, conducting an objective test, and if the results are positive, introducing a procedure to standardise that approach. Involving the relevant workers in finding the solution, and dealing with the situation in a timely manner, where, when and with whom the problem occurs provides a key to a successful outcome.
5 Let the lean system evolve as necessary
The authors stress that introducing lean techniques is not a quick fix – though there will be obvious and immediate gains – and that long term commitment is necessary to achieve lasting results. They suggest starting small with distinct pilot projects from which lessons can be captured and applied elsewhere. They acknowledge that in some instances lean approaches will not be helpful, particularly where visionary and radical experimental work is undertaken. But they stress that in most circumstances, even for creative work, lean principles are surprisingly effective.
6 Leaders need to blaze the trail
As with most change projects, a lean initiative will deliver results only if senior and middle managers are enthusiastic drivers, and motivate and train their teams so that the learning can be applied throughout the organization. Turning an organization into a lean system requires a grassroots reinvention of how work is performed. The transformation demands sustained (though not financially large) investment, a clever approach to training, a change in culture, and new processes. This is not for the faint-hearted: senior leaders must treat it as a long-term. These significant challenges, however, offer huge rewards, since the new system will be tough for any competitor to replicate from a standing start. “This is where the real competitive power lies,” says Professor Upton.
Read the article in Harvard Business Review here
See the IEDP profile of Saïd Business School, University of Oxford
See the IEDP profile of Kenan-Flagler Business School, University of North Carolina
David Upton is the American Standard Companies Professor of Operations Management at Saïd Business School. His primary research areas are Competitive Strategy, Service and Manufacturing Improvement, Information Technology and the Social Impact of Operations. His research is based internationally, with a particular focus on India, China, South America and Europe.
Bradley R. Staats is an assistant professor of operations, technology, and innovation management at the Kenan-Flagler Business School. His research interests cover fragmentation of work, Indian software services, knowledge work, learning, outsourcing, project management, teams, and team familiarity.
Photo: Working on adding machines at the Farm Credit Administration, 1937. © Old Picture of the Day.