What Facebook Can Teach You About Lean and the Workforce

Employees have adopted Lean techniques faster than their employers realize. They’re communicating frequently with others so they can react immediately to changes in demand.  They’re using decision support tools to analyze total supply chain costs. And they are electronically recording and sharing their status several times a day with others who benefit from that information.

Unfortunately for businesses, employees are at home when they are performing these high productivity tasks.  Soccer moms are coordinating last-minute changes in their kid’s schedules. Consumers increased online sales through Amazon by 42% last year, and will increase total online sales to $250 Billion by 2014 according to Forrester Research. 500 million users on Facebook are regularly updating their own network of friends about the minute details of their life.

And yet when a company asks employees to improve the way they perform their work, perhaps tracking labor variances electronically rather than on paper, the company will face numerous reasons why it can’t be done. The basis of these objections lies in employee fears reflecting how the change will impact their ability to perform their job, the potential for wage loss, and potentially job elimination. In fact, in an Industry Week Continuous Improvement Survey conducted in 2010, respondents replied that employee resistance to change was the biggest obstacle in implementing Lean at their company.

The cruel irony of this employee behavior is that the same information management skills and behaviors employees possess and use personally are the major drivers of increased global competition at their companies. The web-enabled consumer is forcing companies participating along all points in the supply chain to lower costs and reduce lead-times faster than ever before.

Consumers wield significant power at the very end of the supply chain. With a click of a button, consumers can find a retailer anywhere in the world that has inventory or will ship for free. Products that are priced even a few pennies higher than the competition without delivering additional value are skipped as consumers scroll through their many purchasing options.

“Loyalty is gone” the grizzled veterans of retailing and manufacturing exclaim. The reality of this statement is their perception of loyalty was really only the lag in time between when a company’s product was no longer competitive and when their customers reacted. In the past, this could take years.  Today however, changes in the market are known as soon as websites refresh their data.  Customers react soon after.

The question remains: Why aren’t employees using the skills they have developed at home to improve their performance at work?  Companies have made it clear they need help from employees to survive. And yet employees continue to resist change.

While it’s tempting to blame the employees from holding back their newly developed skills, they are behaving rationally and predictably.  It’s not that employees are holding back their ability to make better decisions and act with agility.  It’s the environment at work that doesn’t let them perform at their best.

To understand why this is true, the table below compares the difference between why employees use technology differently at home than they do at work.

Consumer Employee
Technology Consumer applications and hardware are designed to be used without training. Enterprise applications are feature rich and have days or weeks of training required.
Benefit and Risks of Change The positive benefits of changing behavior are immediately evident. 

Consequences of failure are low.

Changing behavior can be risky in terms of lowered performance, failure and even job loss. 

Limited upside to the benefits.

Complexity of Decision Making Decisions can be made quickly.  Supporting information is available. Decisions are often complex and may require several steps and supporting information to complete.

What do you think? Are the employees at your company using their consumer skills to improve their productivity at your company?

In Lean Labor, I’ve outlined a number of methods that allow a company to look at its business in new ways and evolve its technology to adapt to change more easily. For a shorter version, send me an email and I’ll return a paper outlining a couple of specific examples that customers have already found successful.

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