Volume 3, Issue 1 - Summer 2018

What does lean have to do with HR?

By Rodelle Genoway.

There are many common misconceptions about human resources.

Let’s start by addressing HR’s function. More often than not, the layman thinks of it as ‘hiring and firing.’ But that’s only partly correct.

The role of HR has evolved immensely over the past two decades. It has shifted from being purely administrative in nature to a ‘business partner’ model, grounded in the leadership of an organization. Modern HR is about creating systems to ensure human capital is working as effectively and efficiently as possible — and in a manner that complies with employment law.

Under that definition, those of you familiar with lean can already see the correlation. Lean and HR are about developing systems to optimize business processes — only one is physical and the other is intangible. For an organization to reach its full potential, equal attention must be paid to both.

After spending several years with manufacturers across the Prairies either conducting lean training or assisting in lean assessments, one thing has become crystal clear: The root cause of most process problems usually boils down to inadequate HR processes.

Whether it be unclear policies, poor communication, an unstructured hiring protocol, the quick onboarding of new employees, an old-school performance management system, no compensation structure, or the lack of a termination process, how you coordinate and nurture your people will have a direct impact on the success of your lean journey. And how you support and lead your people will have the largest downstream effect on your continuous improvement culture.

It would be fair to say that the relationship between lean and HR begins at the recruitment stage. Recruitment is about marketing your organization as a great place to work. The goal is to entice the best qualified candidates to apply. As a manufacturer that embraces lean as part of your ethos, do you make it clear in the job ad that continuous improvement is a core value, and that past lean experience is preferable? When interviewing, do you set aside time to have a specific conversation about lean (I have found that one question to evoke a telling response is: What does lean mean to you?)? Remember that recruiting is just as much about new employees getting to know you as it is you getting to know your new staff, so structure systems to reinforce what matters most to you as an employer.

That carries through to the orientation and onboarding process. Do you spend a generous chunk of time trumpeting your recent or transformational wins that lean tools have helped realize? Or better yet, do you standardize ‘lean 101’ training so that new employees, regardless of department, can speak the same ‘language’ as everyone else in the organization? This is a simple educational investment with maximum ROI.

Another piece of low-hanging fruit that can be addressed early on with team members is the assurance of role clarity, which is a common root cause for organizational inefficiencies. If you’ve ever heard ‘that is not part of my job’ or ‘I didn’t know I was supposed to do that,’ you likely have a problem. Without a clear, documented description of what each job entails, new employees are moulded from tribal knowledge, and the fundamental purpose of the role is eventually forgotten.

Having a shared understanding of scope and responsibility also results in a better performance review process (which is another topic all its own). Peter Drucker once wrote, ‘What gets measured gets done.’ Compelling employees to assess their work through the lens of CI metrics is a powerful means to emphasize the importance of lean. The number of ideas suggested and implemented, the dollars saved because of those improvements, and benchmarks achieved in training and development are all KPIs that I have seen implemented in performance reviews — sometimes directly tied to compensation.

These are steps you can begin to take, today, to align your lean and HR efforts.

But the ultimate goal — an enterprise-wide culture of continuous improvement — requires a bottom-up strategy where the intangible becomes the critical link and HR truly earns its place as an underpinning to lean. After all, the inner-workings of people are not finite. The ability to navigate through change, deal with conflict, understand intrinsic motivation, instill accountability, and engage staff around a common set of objectives are prerequisites to high performance.

None of these come easy, either. The first step is for HR to understand what the business does and how it does it, including its systems and bottlenecks. The next step is to modernize HR into the leadership structure. Great things will soon come. Payroll is typically the largest line item of any business — why not ensure it is working to its full potential?

For an industry that makes tangible things, focusing on the intangible can be an uncomfortable exercise. Yet, by improving the intangible, you will lead to tangible — and rewarding — results.

Rodelle Genoway is the principal of Untapped Potential Business Consulting. She is a Chartered Professional in Human Resources as well as a certified Lean Black Belt. She holds a bachelor’s degree in commerce and a master’s degree in business administration.