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CHAPTER FIVE OUTCOMES OF LEAN

5.1 The test for any new management concept is whether or not the outcomes of the approach are sufficient to justify the cost and effort of implementation. The first section explores how outcome objectives were set by the implementation teams to understand the appropriate mechanisms for determining objective-setting. The nature of the objectives being set for Lean implementation and whether or not the objectives are realistic and appropriate are also assessed.

The next two sections explore the tangible and intangible outcomes of Lean. Due to the nature of service only a proportion of the appropriate performance measures that can be applied are tangible, hard measures. It is also important to understand the softer aspects of changes to service delivery. Therefore, it is equally important to assess the intangible impacts of Lean, especially upon employees. Within the literature too, some issues are identified concerning its impact amongst front-line staff.

The outcomes of the case studies and an early insight into the achievements of the pilot sites are then summarised and presented. Although, it should be emphasised that the pilot sites were still in early stages of implementation and hence the outcomes cannot be fully measured or predicted. Finally this chapter will also outline possible reasons for the failure to implement changes and the factors that may be relevant in ensuring sustainability.

A. Setting Outcomes

5.2 Although process improvement was the common goal across the board, how the outcomes were set, by whom, and at what scale varied widely across the case studies. What differed was the relationship between the improvement of a process and the achievement of a broader objective.

5.3 In some cases, process improvement was broken down into "bite sized chunks" which were consciously linked to the achievement of a higher objective or target. In these cases there was a degree of flexibility and freedom about the specific targets for each process, provided they contributed to the achievement of the higher objective. For example, in the case of one of the local authorities, the most direct outcomes are those expressed in the management goals, the general parameters of which are summarised in the Guidance to Managers:

"Consider areas which are key to your service where improvements would result in better customer satisfaction, higher staff morale or the achievements of externally set targets." ( CS3)

The guidance also emphasises the need to show measurable improvements, and that a balance needs to be struck between ambition versus feasibility. In this case, through the interviews it transpired that expectations (and targets) were kept tightly controlled so personnel in the organisation could meet the targets which were set.

5.4 However, in other cases this control was seen as an impediment to change, described as a "top-down 'command and control' culture":

"The rapid implementation only had a moderate success with the less politically sensitive changes taking place and everything else postponed. This may, in part, be due to the fact that the preliminary works to identify the issues have been devised almost entirely by the two people in charge of the unit. Therefore the team working was very limited in its scope to identify alternative problems or alternative issues. Similarly, other team members brought in from other departments were not allowed to bring their issues to the table. This clearly influenced the degree of commitment to the implementation." ( CS2)

5.5 In other cases, the driver for change was the only focus and desired outcome, and all other impacts should be avoided. In other words, if the driver was service improvement linked to staff empowerment there was explicit guidance that financial targets or anything involving a decrease in staff should be avoided:

"There was a deliberate reluctance to set large strategic targets for Kaizen. It was pitched much more as a tool at the service level and the manager's targets were specifically for that service. There was also a reluctance to set money targets for Kaizen as senior management felt that this would have a negative impact on people's willingness to participate. This may need to be tested in the future." ( CS2)

5.6 In one local authority, for example, the key message from the Chief Executive was that:

"Kaizen is not to cut jobs but to improve morale … to keep competitive advantage in the public sector." ( CS3)

While there was no doubt that in this case the programme was very popular with participants, with a wide range of individuals describing personal paths from deep scepticism to total commitment, there was an acknowledgement that this might limit its application to service improvement driven by the need to make efficiency savings.

5.7 This view was echoed by a senior officer from the other local authority:

"They have so far focussed on hearts and minds, rather than big stick and have not been robust in exposing savings." ( CS4)

5.8 Similarly, within the RAF case study, there was a concern that mixed messages about drivers and required outcomes might have a negative impact on the willingness of staff to participate in Lean activity:

"When we save manpower on an activity - those people don't become redundant - we move them to other areas.… The trouble is, they don't believe that, they don't see that so we have to sell that, which is why I go about making a big issue about waste."( CS8)

5.9 Interestingly, the survey (Annex 2) reported that those Lean projects deemed to be unsuccessful in achieving their original aims were the ones mainly concerned with cost or workforce reduction.

B. Tangible outcomes

5.10 While some outcomes were very limited "bite size chunks", others looked at a whole service. Some were linked to other initiatives such as ICT projects or customer access improvement programmes. There was a wide range of tangible outcomes reported, including:

5.11 Improvement in customer waiting times towards achieving a national health target:

"We have been able to say that they have increased their percentage of patients meeting their fixed target from around 40% in 2003 to currently sitting at 75 and 80 per cent as an over all 62 day target." ( CS7)

5.12 As an example of the practical impact of the above change, the journey for some cancer patients had 6 fewer steps than previously and an average reduction in time to first appointment from 23 to 12 days.

5.13 Improving service performance through migration of services into a corporate "front office":

"If a service area shows high levels of failure demand, the Northline Manager will contact the relevant department to flag up the situation and work with them to resolve the underlying process problem and improve the service. Since this approach is also used in the Business Change Process we can demonstrate before and after information on demand. At this review stage, we also measure capability - the measure of how well the service performs on what matters to the customer. In one service area Failure demand was reduced from 82% to 15% in four weeks." ( CS4)

5.14 Improving processing times. The Planning & Environment department of one of the local authorities set its goal to "register 100% of planning applications within 3 days". In six months the time taken for registration was reduced from an average of five days across the six areas to an average of two.

5.15 Achieving more for less. In one of the central government agencies the Blitz process very successfully devised a way of structuring documents in a labelled filing system so that every document could be identified quickly by the recipient who was conducting the research. This was seen to be important to cope with the increased workload with no extra resource.

5.16 Bringing services up to a standard. The Head of Environmental Health in one local authority described the use of the business change process, supported by one of the business change managers, which had turned around an inconsistent and failing service. He had come from a neighbouring council with the remit of restructuring what had been three separate services.

5.17 Improvement of customer flow. By the use of process mapping and removing non value adding activities as well as incorporating the streaming process a result achieved in one of the health cases was a reduction in flow time for patients of 48%.

5.18 In the RAF case clear reduction in staffing and other costs were reported . Between February and November 2005 there were two Value Stream Analysis events, each generated an implementation plan, including 14 RIEs. These have generated a 105 person reduction in manpower and £31m budget saving. A more recent estimate of the total savings for the platform programme to date was over £60m.

5.19 The research was designed to evaluate the pilot study results after four weeks. Therefore, it would be unreasonable to expect very rapid implementation of quantifiable results. However, there was planning for a steady phasing in of the improvement actions. In pilot study 1, the following achievements can be quantified in the weeks following the improvement event:

5.20 The second pilot study generated 96 improvement ideas and the third pilot 45 items. Both also developed an implementation plan (3 C's document) to act upon these, where possible, within a three-month time frame.

C. Intangible Outcomes

5.21 There was also a range of intangible outcomes delivering benefits to the customer, the organisation and the staff which can be summarised as:

5.22 Changing the referral process for patients:

"For the patient -- when they changed the referral process to cut out the step of referral from the GP they surveyed patients and found that they were happy because it speeded up the process." ( CS7)

5.23 Changing the culture of the service organisation:

"We used to deal with houses - we now deal with homes." ( CS2)

5.24 In one case study, Lean had contributed to a greater focus on prevention (as opposed to "policing" or reacting), improved partnership working, more satisfied and empowered staff working in more flexible ways.

"The way of work allocation now that people are nominally in teams but not locale located means that the delegation of work is easier where teams can be allocated work rather than individuals. This means that variation in workload can be spread fairly across people". ( CS2)

5.25 The improvements also supported the delivery of other programmes such as an ICT implementation or a best value review. Other benefits reported were that respondents understood the whole system and the organisation better and that after, having met others involved in the process, they had better ongoing working relationships with them and were better able to deal with problems as they arose:

"I have worked for council a long time - seen people's names on list but now know them and can call them. Kaizen helped make links between offices. Now lots of to-ing and fro-ing and e-mails across different areas." ( CS3)

"It has fundamentally changed the shape of the organisation and the shape and content of the jobs." ( CS5)

5.26 Many of the case studies reported that the improvement and change programmes had helped to create a better understanding of the need to consider the customers themselves as the receiver of the service, rather than the needs of the central department.

"There is a customer focus attitude : that they are there to serve the community - not 'ivory tower we know best'". ( CS3)

"General role of Lean thinking is increasing. Customer focus - Lean thinking helps." ( CS4)

"I was looking at how we could collectively help in improving the process from the patient point of view." ( CS7)

"Patient involvement is at the heart of the ….Plan and the…[organisation] has tried to ensure that the patient's voice is heard during the redesign process." ( CS7)

5.27 Related to the last quote, this health case involved patients directly in the mapping and redesign of services by organising special sessions for patients which were then fed into the service redesign process. Although, interestingly, within the same case study it was reported that it was felt that there was still some way to go in creating a customer focus, with one respondent commenting that compared to the private sector retail environment, where she had recently worked, customer care practices in the NHS were fairly poor.

5.28 In addition, putting things right when they go wrong was easier because the services have better information about, and understanding of, the process, as well as supporting a culture of continuous improvement:

"…previously they were producing all this audit data and nobody was actually paying attention to it. It was not in use as a tool which I think is what they want to do now. Because they have been tying that into the changes they are actually much more aware. I think they will be much more willing to recap and much more able to say right what is happening where has it gone wrong why has it gone wrong and is it something we can do to change that. And as a team we can - fine if it is an external factor then we seem to have a better ability to communicate that in an appropriate manner. To have something done about it if that is the case." ( CS7)

5.29 The two local authorities both mentioned an increased emphasis on measurement of, for example, customer demand as one of the beneficial spin offs from their improvement programmes. However, commentary on one of the agencies suggested there was an excess of performance management in that organisation, which effectively amounted, in Lean terms, to waste.

5.30 The staff also benefited in a number of ways, including greater job satisfaction, improved confidence and development of a critical mindset to embed a continuous improvement culture.

"I think for some of the staff involved they have seen some changes happen that they wanted to see and then actually making that change now, which they never managed to do before. I think the general feeling of the staff here is that they are providing the patient with a better service." ( CS7)

5.31 Staff were generally happy with the results of the change activity. A particular characteristic was where they saw efficiency improvements as helping them in their own work and enjoyment of work:

"Most people think it is a nice place to work." ( CS6)

"I think the better service we do the better life we all have the better we do our job." ( CS6)

5.32 For others, the experience had built their personal confidence and convinced them that the organisation would listen to their ideas and that it would implement change. The following comments were from Kaizen team members from one of the local authorities:

"I'd not been in the job long and realised how much knowledge admin and clerical jobs require. We are not given credit for what we know. This was my first opportunity to make a contribution to improvement." ( CS3)

"I have been in the council quite some time and it was the first time I was involved in looking at the process." ( CS3)

"It was pleasing to come to the end of the week and having gone through a complicated process with something different from what we do." ( CS3)

"We can now see how everyone works - we need more of that - team working has begun to bear down. It will improve the way we work."

D. Overview of Outcomes

5.33 Table 5.1 summaries some of the qualitative and quantitative outcomes for both the case and pilot studies. It is interesting to note that both tangible and intangible outcomes are reported for the majority of the organisations.

E. Failing to implement changes

5.34 While all the case studies documented some positive outcomes, concern was expressed across the case studies about the gap between proposals coming out of the improvement process and what was being implemented. The reasons for the possible 'failures' to implement changes are varied and have been highlighted in the literature as common factors for failure (see Annex 1).

These can be summarised as:

Lack of resources and resistance to change

5.35 Sometimes the failure was simply due to lack of resources to implement changes, maybe due to the difficulty in "backfilling" into the posts of those being seconded into change agent roles.

5.36 People also cited resistance as a failure to implement change, especially staff who might be affected by the changes but who had not been through the process. For example, in the case of one of the government agencies:

"A separate element of the Kaizen Blitz identified the problems caused by the accommodation.… On the Wednesday of the Kaizen Blitz the team started to implement … changes. Unfortunately the Team Leader …who had suggested the multi-disciplinary team approach could not be present on that day…. As a consequence, when the other team members turned up to move people's desks and swap people round into multi-disciplinary teams [those] not involved in the Kaizen Blitz refused to cooperate. Consequently this change did not take place." ( CS2)

"Even though one third of the complete workforce within the unit were involved in the Kaizen Blitz, this did not succeed in bringing about support from the Department as a whole. There was a lot of dissention from people left out of the Blitz process. This factor is probably the most important in the lack of success in implementing the idea of multidisciplinary teams." ( CS2)

Table 5.1 Summary of the Qualitative and Quantitative Outcomes of the Case and Pilot Studies

5.37 Pilot study 2 highlighted that unions needed to be engaged in Lean effectively if there was not to be formal resistance to change. A union representative was involved in the RIE, resulting in union support for Lean because of the perceived benefits of Lean working on employee morale and workplace stress. It should be noted that the policy of no compulsory redundancies had a positive effect on the willingness to adopt Lean. In the follow-up interviews it was revealed that without this protection for staff Lean would have been seen as more of a threat by staff and unions.

Post RIE/ Blitz lack of ownership for the improvement activity

5.38 There was evidence of some delays in implementation following the RIE week. From one of the health cases, it was observed that improvements from improvement events could be difficult to sustain if post event ownership was poor and follow-up did not work.

"[What happened on the following Monday?] Not a lot - it took a week. [How many recommendations? ] 8-10 - half have been implemented - harder ones have not. We have not met as a team since." ( CS3)

"This lets people slide back into their comfort zones and there is resistance to change. Small improvement that can be adopted on a personal level can be left to wait till another such event is organised. Lack of continued management support and resources can mean that this improvement is only short lived." ( CS3)

5.39 In the other health case the resistance appeared during the improvement process and was not overcome, which prevented implementation of suggested improvements after the event:

" Mapping day - some came well prepared. 20-30 people. Some people said they would not move. Their attitude focussed the discussion (and were a barrier) and decision to move forward. Two hours only . PDSA was not presented - it was all very quick…Still at planning stage - study. Still trying to implement." ( CS7)

Lack of management, and staff, commitment throughout the change process

5.40 The importance of staff engagement was explicitly recognised in one of the local authority cases, which used Kaizen, as one of the key features. The participation of practitioners which, when combined with speedy implementation, helped sustain the commitment of those affected by the changes most of whom had already been directly or indirectly engaged in the process. It was made clear that should the commitment from management to attend the Rapid Improvement Event slip, the commitment from staff to participate would probably also slip and so, therefore, would the implementation of potential improvements.

5.41 In one of the pilots both staff involved in the RIE and sponsoring managers said that the RIE process could be clearer about the next steps post RIE. The manager in particular said that while she took on board the clear message from the facilitators not to take over and "managerialise" the outcomes of the RIE, the staff were not perhaps taking as pro-active a role as they had been invited to take. She speculated that this might be due to the lack of seniority of the staff involved, which she acknowledged was a good thing in principle, combined with the culture of the organisation which did not normally encourage this sort of responsibility.

5.42 In other cases it was the perceived lack of support from, or capacity of, senior management that blocked implementation of changes:

"The outcomes of the project had been communicated to senior management but to nobody else. However, it should be observed that even some of the changes were not communicated to senior management very deliberately. In some cases some of the changes were deemed not to be part of government policy or department policy and this would cause senior management to react unfavourably to the change suggestions. Therefore some changes have taken place quietly without senior management knowledge." ( CS2)

"External constraints may limit the amount of time the CEO has to implement these changes." ( CS6)

"We need to have a stable management to see these changes through." ( CS6)

5.43 Staff and middle managers within organisations were identified as key barriers to Lean implementation in two of the case sites, largely because they had variable abilities, some had been in the organisation a long time and were only focussed on the day-to-day delivery. In some cases, managers owed their position more to professional seniority rather than to being effective managers, which impacted upon their readiness to engage with Lean improvements.

"There has been tension between front shop/back shop - with the perception that the best of the crop goes to front office…" ( CS4)

"Middle managers…there is still considerable resistance." ( CS4)

Slow natural pace of change

5.44 In most of the case study sites, interviewees reported historical tendencies for the slow pace of change in their organisation. In two cases, this lack of response had resulted in crises that had forced radical change involving new management teams. In the Lean implementations some RIEs equally suffered from this inertia problem with the improvement ideas being put back into existing bureaucracies. In one pilot site interviewees commented that a pre-Lean suggestion to introduce a customer handbook had taken two years and was still not ready. After the Lean implementation no work was immediately completed but a plan to introduce improvements to a schedule was devised.

"At this time. I don't know of any [changes]. I know the board is having meetings" ( PS2)

"I have not seen any result because we have not actually implemented them yet" ( PS2)

5.45 The purpose of the RIE approach is to introduce change quickly to minimise the risk of loss of enthusiasm. One council employee conveyed the impact of lack of action to change suggestions before Lean was introduced:

"They would see their line manager in the past. He would maybe make a suggestion and nobody comes back[to him ] - people just felt terrible" ( PS2)

5.46 The ability of the organisation to adopt changes quickly is clearly a necessary characteristic. Although this point is relevant for all public sector organisations, additional care should be taken where changes need to be formalised or adopted on a wide scale. This is especially relevant in healthcare where some changes may need to be authorised by committees that meet infrequently. The momentum for Lean has to be sustained during these delays and at times this may be difficult.

F. Sustainability

5.47 Many of the case studies addressed the issue of how to sustain continuous improvement. Resources and organisational capacity, culture change and knowledge transfer, and leadership and communication were seen as the main ways of trying to ensure this.

5.48 In the case of one of the local authorities using Kaizen it was the sheer scale of the work which appeared daunting. Each process improvement was owned by a manager and developed by a team of around a dozen people working full time over the course of a week. The commitment of all participants was impressive but there has to be some concern about the capacity of the organisation to sustain such a programme, both in terms of the skills required to drive the programme and the heavy resource required for each Kaizen.

5.49 The dangers of not providing sufficient resources or some sort of "invest-to-save" mechanism to recycle resources through improved efficiency was also highlighted in one of the health cases where the management still have not secured funding for the cost of quality improvement. They have benefited from free consultancy and hence seem to have gone into the process with the attitude that there was nothing to lose.

5.50 In four cases, though interestingly not in the government agencies which worked to a more commercial model, there was a conscious effort to transfer knowledge from external consultants to internal consultants. While this was seen as positive, there was a concern in some cases that the particular methodology used might get diluted unless there was an independent quality assurance role taken by the change agents, although, as we see from one of the health case studies, this role was by no means clear:

"…we went in and undertook the exercise with them and then explained what to do with the initial PDSA cycle with the view that they would then have the ability to - or should have the ability to undertake those on a longer term basis whether we would always be a support mechanism should we need to come back in" ( CS7)

5.51 In the RAF case the sustainability model was also based on skills transfer:

"Although they [the consultants] cost us £2000 a day they are saying there are a lot of these things you can do yourself and they are happy to do it whereas some other companies won't tell you what the secrets are and we get all the tools." ( CS8)

5.52 However there were some perceived problems with this approach:

"…in some areas we have managed to pass over the expertise to the Lean team guys, the problem in the RAF though is people keep getting posted.… You can challenge that but … the problem is our model is about transferring skills over a time period… not immediately."( CS8)

5.53 In another case study there was resistance to the idea that a continuous improvement culture could be achieved by knowledge transfer except through direct participation i.e. no manuals or "toolkits". Leadership at a strategic level and communication were seen as key to supporting the development of a continuous improvement culture which ideally needed to be the responsibility of all employees at all times rather than being driven from the top:

"Continuous improvement should be a part of one's daily work and not a once a year event that one has to attend. Each person should be flexible to learn a new way of doing things if this is in the interest of improvement." ( CS1)

5.54 An interpretation of these findings is that sustainability requires a critical mass of people who are comfortable working with Lean practices. In the short-term this requires behaviour change and those using the tools and techniques being trained in Lean. However, the objective is that once a critical mass is achieved, Lean should become standard practice and so self-sustaining. This sustainability may be difficult in public sector organisations where there are implementation difficulties associated with a naturally rapid turnover of staff, e.g. the rotation of junior doctors. Also, if practitioners within public sector organisations become experienced enough in Lean, there is a possibility that they will be attracted to work elsewhere, including a loss of some experienced staff to the management consultancies implementing Lean.

G. Replicability

5.55 Linked to the concept of sustainability is the question of replicability. This could be considered at two levels. First of all, is a particular methodology replicable across different organisations and secondly, could a particular process improvement be transferred between departments or even between organisations? There was an acceptance that, notwithstanding cultural and other contextual differences, the former might be possible (maybe through the use of external support).

5.56 On the latter point, however, there were opposing views, though this view was limited. For example, one of the improvement programmes in health makes a virtue of offering "off the peg" process improvements as a way of engaging with target hospitals:

"…[The organisation] supports … networks across all three regions in Scotland. Results demonstrate reductions in delays and improved services. The team are now encouraging services to adopt a core number of successful changes to reach national targets." ( CS7)

5.57 Health care is possibly a special case where there are many sites of a very similar nature that can adopt very similar practices. Nonetheless, it was more common to see a reluctance to completely replicate practices from one organisation in another. For example, change agents in one of the local authorities made it clear that:

In their view "drag and drop" is dangerous: "Methodology can be transferred - but not processes." ( CS4)

5.58 Similarly in another case study, while one senior manager in the same organisation saw the improvement programme as an opportunity to standardise a particular service across what had been three districts, the change managers had a rather different view:

"This is not about standardisation but specialising. Four different processes across different areas - important to look at demand across different areas…In one particular local process - look at demand for X in specific area. Otherwise lose learning aspect - staff engagement." ( CS4)

5.59 The pilot studies showed that conventional tools used in Lean implementation can be successfully adapted and applied. There were no issues for staff when they used the concept of 'non value-adding activities' and the methods of process mapping successfully identified cross-department issues. Again, the pilot studies usefully demonstrated the above comment that it is the methodology that must be transferred rather than particular solutions to specific problems.

H. Summary of Lean Outcomes

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