Changing Management Thinking by John Seddon

This month’s and immediately also our first guest blogger is none other than John Seddon.

John Seddon is an occupational psychologist and management thinker credited with translating the Toyota Production System (TPS) for service organisations. John maintains the TPS is not a set of tools, but a different way of thinking about the design and management of work. ‘Lean’ as tools, he insists, is to completely miss the point and was something Taiichi Ohno (the architect of the TPS) argued against.

The principles behind the systems approach are counter-intuitive to the command-and-control mindset and, hence, are best learned by doing. John and his colleagues in Vanguard have developed methods to help managers study and re-design their organisations as systems, teaching in the same way as Ohno taught. In service organisations change is much faster than in manufacturing, for nothing is ‘made’. Profound results can be achieved rapidly provided managers change the way they think.

John is a visiting professor at Cardiff and Derby Universities and a visiting fellow at Hull University.

We, mankind, invented management. It doesn’t work very well, we can change it.

We invented it…

Adam Smith extolled the increase in productivity through specialisation; Henry Ford showed how specialisation and standardisation drove down unit costs; service organisations have become industrialised, front-, back- and now middle-offices abound. Economy of scale is management’s preoccupation. These ideas are conventional.

It doesn’t work very well…

Henry Ford gave us the 5-day man; today the same levels of demoralisation are found in industrialised service organisations. Managers demoralise their workers by managing activity (big mistake as most of the variation in performance is down to the system, the way the work works).

Service isn’t working. Customers find they rarely get their needs met in a single transaction, so dissatisfaction increases and failure demand increases. Managers are blind to failure demand, treating all demand as though it is work to be done (big mistake as knowledge of demand is management’s greatest lever).

By managing costs managers cause costs to rise. Specialisation increases fragmentation of work, standardisation prevents the system from absorbing the variety of customer demands. Conventional industrial designs create more work. Calling this ‘waste’ is insufficient and misleading; we need to understand its causes. They are in the way we think about the design and management of work.

We can change it…

By helping managers study how the work works. When managers study their service organisations they learn some counterintuitive truths. When they see that most variation in performance is down to the system they appreciate the need to remove activity management and replace it with management that works on the system, not the people. When they see the volumes of failure demand and determine that the causes lie in standardisation and specialisation of work, they appreciate the need to learn to manage value rather than cost. Managing value drives costs out. It’s a paradox. When they design a system that puts workers in control of the work, they achieve real control and substantial improvement.

But we can only change it by seeing it. To change management thinking first we need to learn how to look.

Professor John Seddon
www.systemsthinking.co.uk

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One Comment on “Changing Management Thinking by John Seddon”

  1. BrianSJ
    November 12, 2010 at 09:10 #

    The above sounds more like Volvo at Kalmar and Uddevalla than TPS.

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