The single most difficult thing to change in an organization about to implement “lean” isn’t work habits or processes but employees’ minds. It’s a different way of thinking.
Different, but necessary.

If you’re going to compete in the future, you’re going to need to find new ways to work. The old approaches no longer deliver. You see it happening every day in business – someone can do it cheaper with better results. The answer lies in removing waste.
Identify and remove the waste, and you remove its cost.

Look at your own management structure. Does it provide value for the cost? Why not put these resources to use in building a better business? Competition for the collision repair customer is only going to get worse over the next few years, and it’s those of us who start working on new solutions today who have the best chance of being around tomorrow.

Change in Thinking

Lean thinkers see the world differently. They see things in terms of process rather than cost. They’re driven by capability, not by position or structure. For example … 

• The lean world looks only at the whole or overall outcome.
• The cost world looks at each part or individual area’s performance.
• The lean world asks, “How do we improve the rate of cash generated?”
• The cost world asks, “How do we control or reduce costs of services?”
• In the lean world, the needs of the customer decide our actions.
• In the cost world, the margins of each job decide our actions.
• The lean world sees employee compensation as motivation.
• The cost world sees compensation as determining gross profit.
• In the lean world, business information is visual and communicative.
• In the cost world, management holds all the information.
• The lean world knows that competition sets the prices.
• The cost world believes that business costs set the prices.

These are just a few comparisons between traditional and “process centered” organizations, but you can see that they’re very different. Before people can be successful in a lean organization, they must first come to terms with this type of thinking.

Much of what I’ve written about in the past helps explain these above concepts. If you haven’t been reading this department, go back and read up.

The second major difference in thinking lies in how organizations are structured – how they’re managed. If you think about traditional management from the perspective of adding value to the customer’s requirement and use the tools of kaizen to map out the value-added activities performed, you’d clearly see that we, as management, provide almost zero value.

What is it that we do as managers that adds value? In other words, what tasks that we perform every day are customers willing to pay us for? Processing payroll? Managing time off? Performing an employee review? Running around trying to get someone to finish up a job? No, no, no and no. A customer isn’t willing to pay us to manage his repair through the process. We do that for free.

The Traditional Shop Manager…

Take a closer look at the role of traditional shop managers. How do you define a really good one? What are their common characteristics? Most would tell you that it’s …

1. Their ability to make stuff happen. Great body shop managers overcome outrageous adversity. They’re able to make vehicles leave at the end of each week no matter what goes wrong. They’re master expeditors. They have the ability to sort through all of the customer concerns and determine who can wait and who must go now. They manage to retain all the information about the current inventory and can tell you almost anything about every customer, present and past. 
2. Their knowledge of collision repair. Great shop managers can quickly make good decisions about repair direction. They know what can and can’t be done. They not only know how the work should be performed, they can also, in most cases, actually jump in and do the work themselves.

The two main ingredients of a great manager are knowledge (having all the information about every job) and decision-making skills (knowing how to use the information to sort through the possible outcomes and choose the best path). Managers, in most cases, structure their day to maximize their effectiveness in both categories. They have management systems that organize the information for easy reporting. People in the organization have specific responsibilities to input this information so that it can be reviewed (hopefully it’s entered promptly and correctly). They hold daily meetings to review this information with their team. Some have several meetings daily.

These meetings are designed to:

1. Gather additional information about the jobs that might not have been recorded. 
2. Raise all the issues so that the best decisions can be made. 
3. Make the decisions and direct activities for the day so that the work keeps moving forward with the least amount of customer concerns and the maximum amount of revenue production. In most cases, subsequent meetings start by reviewing the “To Do” list from the last meeting and then look at all the problems that arose since then.

Sounds pretty good, right?
Good managers, in one way or another, work like this. But is this the best way? I can tell you that most other industries work like this, so it’s difficult to criticize. But if you were to look at this system of management from a lean perspective, are these activities “value added” to the customer or are they waste?

Re-Thinking the Manager Role

If you look back at past articles, you’ll see that the objective of lean is to continually identify and remove waste from your business (removing the non-value added activities). If you’ve built this type of system, how valuable (or invaluable) does your manager become? Can the business function properly without him? Are these managers some of the highest paid in the organization? Are these managers with knowledge and decision-making skills easy to find?

You know the answers.

Now take an honest look at this type of management and ask yourself this question: Are there other people in the organization who have the ability to make good decisions?

We said that good decisions come from knowing all the information surrounding the issue at hand (as well as what else might be going on in the organization) and having the experience to understand the possible outcomes. If you’re looking for experience, wouldn’t the best resource be the people who work in that area each day, performing that type of work over and over again?

Today, you have these experts in every bay, desk and chair in the
building. The missing element is the
information.

Yet this information is collected by these same people every day. It’s recorded and stored by them in management systems, on schedules, on timecards and on whatever various tracking tools you (or your people independently) may use. This information then becomes the property of the manager and is organized so that he may have a clear picture of the overall state of the operation.

So the real question is: Is your manager really that much better of a decision-maker than the rest of the people in your organization, or is it that he just has more information about what’s going on?

I think that all of us, if we were honest with ourselves, would say that our people could make just as good a decision, if not better, than we could, if they had all the information. But it’s not easy to admit that our decision-making is no better than that of our employees.

Obviously, the first thing that will pop into a manager’s mind is, “This sounds like I’m agreeing to no longer having a job.” But wouldn’t a manager’s time be best spent working on other things? Shouldn’t he be working on improving the customer’s experience, marketing your value to new customers, improving the satisfaction of the people inside the organization and improving the overall business process?

Lean organizations do exactly this. They understand that a manager’s value isn’t in being the gatekeeper of information and directing all activities. They know it’s more important to expose the information so more decisions and possibly never-before discovered solutions are brought forth by everyone. They attempt to demystify the role of management. They understand that 10 people working on a solution is clearly much better than one.

But the risk you run in doing something like this is that the very people you need to create this environment are the same people who recognize their current value to the organization as the exact opposite. Managers gain personal reward in being the problem solvers. They’re praised for their ability to do such. At the end of the day, these “firefighters” feel good about making things happen. They love the challenge of being faced with seemingly insurmountable problems and finding a way to “pull off a good day, week, month.” Worse than that, if you place a firefighter in a situation that never burns, he’ll start the fire himself.

The role of a traditional manager, by definition, is one of control. He pushes all the buttons. It’s his job, and his job alone, to steer the ship. In many organizations, people wouldn’t dare make even the simplest decision without first getting approval from the manager.

But the reality is that this type of organizational structure is a waste of time and money. To not have these responsibilities shared by entire organizations is not only foolish, but also an injustice to everyone whose ideas and contributions are never allowed to grow.

Is it that managers think the people working in the organization aren’t smart enough? Is it a turf protection move by management?

I struggle to understand why organizations still utilize the chain of command and line of authority structure, when it’s clear that they’re wasting a precious (and already purchased) resource.

Shifting Your Organizational Structure

So how can you make your organizational structure more effective? Start by changing how your organization looks at a couple of things.

1. You must first help managers find personal reward differently – to learn to hate firefighting. You must stress that while sometimes it’s inevitable, they should hate it when they’re doing it. You must help managers understand that their real value lies in helping others learn to solve the problems. You can help managers move past controlling everything by replacing the self-induced satisfaction of “making it happen” with the greater, yet longer term, satisfaction of personal reward through building great people. 

2. You must have a vision. If you have no need to get better, then the current way things are being done is good enough. If the vision of the organization is to get better, however you define that, it’ll require a more organized and effective approach to how you do everything. People won’t have the time to clean up problems and will begin to develop the disciplines required to “do it right the first time.” Managers will realize that they don’t have time to “manage” work through the shop and that they need a simpler system that requires very little management – a system that helps everyone make better decisions when faced with problems and gives that decision-making authority to the people. 

3. You must create “leaders,” not managers. Leaders by comparison function much differently than managers. Leaders take the greater role of continually moving the organization to a better place. They don’t need to, or want to, know everything about a situation. They need to know that this information is easily available for everyone. They have no desire to make decisions; rather, they desire others to be able to make them effectively. Leaders see complex situations as opportunities to create simplicity; managers just see them as trouble. The role of a leader, however, isn’t easy. He must see much further down the road than a manager. He also must understand that the rewards are a much longer-term proposition. He must have courage to keep moving forward when, at times, everything around him says, “Just jump in and get it done.”

The Process Becomes the “Manager”

Think about this. Of all the
activities traditional managers perform each day, how many are associated with either solving problems that arose or providing information about a job, i.e. “I’m missing a part, “Are we supposed to fix this dent?” “This customer wants to know when …”? How does the manager answer these questions or solve these problems? He looks at all the information available and processes a decision based on experience.
Couldn’t the information required and problem-solving techniques the manager uses be turned into a simple system, easily available to everyone so management wouldn’t need to be called in?

In lean organizations, this is the case. The business process itself is actually the manager. It keeps everyone informed about what’s going on everywhere. The process tells everyone what should be done, when, how it should be done, where it goes next, how to know if it’s done correctly and what to do when things go wrong. The process tells everyone how they’re doing against the customer’s expectation. It also tells them what’s not working so well and what everyone needs to fix in the process.

If this were the case for your organization, couldn’t you now turn your managers into leaders?

Contributing editor John Sweigart is a principal partner in The Body Shop @ (www.thebodyshop-at.com). Along with his business partner, Brad Sullivan, they own and operate collision repair shops inside new car dealerships, as well as consult to the industry. Sweigart has spent 21 years in the collision repair industry and has done everything from being an independent shop owner to a dealership shop manager to a store, regional and, ultimately, national director of operations for Sterling Collision Centers. Both Sweigart and Sullivan have worked closely with former manufacturing executives from Federal-Mogul, Morton Thiokol and Pratt & Whitney in understanding and implementing the principles of the Toyota Production System. You can e-mail Sweigart at [email protected].