Implementing Lean methodologies promotes IT, business agility

Niel Nickolaisen

Many years ago I read a Harvard Business Review article that inspired me. The article, "Beyond Toyota -- How to root out waste and pursue perfection," explained how one company, Lantech.com LLC, in Louisville, Ky., used Lean thinking, tools and methodologies -- in this case, the Toyota Production System -- to dramatically improve its processes.

Niel Nickolaisen
The Real Niel
Niel Nickolaisen

Over the years I have used this article as pre-reading for my IT teams as we take on process improvement initiatives and improve our contributions to IT and business agility. It is a great, well-written example of what is possible when we combine the desire to get better with repeatable methods -- in this case, lean tools.

From lean methodologies, I have learned about the seven forms of waste and how to map those to IT processes:

  • Rework: How many times in IT do we ask for do-overs?
  • Waiting: For example, we often have to wait for the input of a subject-matter expert before we can make a decision.
  • Overprocessing: Research tells us that 64% of the software features and functions we develop are rarely if ever used.
  • Excess inventory: A recent study found that about 40% of our software licenses are shelfware.
  • Excess motion: How many of our status reporting mechanisms actually generate value rather than churn?
  • Excess movement: Am I the only one whose projects get caught in multiple decision loops?
  • Overproduction: How many of us buy licenses in large batches rather than just in time?

If we address these forms of waste, we can improve our processes; in turn, the IT department's credibility grows and we are more successful. But is rooting out waste a guarantee of success? How do we ensure that we are doing the right things, not just doing things the right way? In other words, I have started to wonder how to go beyond Lean.

I have come to believe that what is "Beyond Toyota" is agility. Not agile software development but business agility. With the pace of technological change and the competitiveness of the marketplace, our lives can change pretty dramatically very quickly. How many companies that once rode high are now obsolete? How many have gone from good to great to gone? I suspect that even more have gone from good to gone and good to lousy. If one of IT's capabilities is agility, we can respond to changes better. If we are really good at IT agility, we can lead the marketplace and force others to respond to what we are doing.

Implementing Lean methodologies is a critical element of business agility. If our IT processes are complex, bureaucratic and filled with waste, these processes will get in the way of our agility.

We also need focus -- not just any focus but focus on our sustainable competitive advantage -- the one thing that we do better than our current and future competitors. We should focus our IT innovation and creativity on continually addressing and improving one business need at a time.

It seems to me that an effective, agile IT culture requires trust. Questioning the motives and actions of our teams and peers becomes concrete that we must wade through as we make decisions and execute our plans. Trust allows us to push decision making to the edges of the organization, where market and customer intelligence are the most timely and relevant.

Finally, IT agility and business agility rely on collaboration. A proverb claims, "No one of us is as smart as all of us." We need to collaborate, not only inside the organization but across the entire supply chain and market chain. Otherwise, we might miss potential solutions and -- even more dangerous to an agile business -- early nuances of changes.

We can improve both IT and business processes continuously by aligning IT innovation with the organization's most pressing needs. In my case, I don't need to do virtualization better than anyone else on earth, but I might need to do business intelligence better than competitors so that my business can make better decisions about products, customers, competitors and markets. I need to trust first and always consider the costs of a lack of trust when dealing with my team and my peers. Finally, I should think collaboratively -- even better, I should implement technology that makes collaboration easier.

We IT leaders can play a critical role in moving "beyond Lean." We have incredible knowledge about our organizations' IT processes, we can identify ways to use technology to exploit our sustainable competitive advantage and we can model trust and collaboration. In fact, doing so might be the key to moving "beyond the CIO" and being recognized as business, rather than technology, leaders.

Niel Nickolaisen is CIO at Western Governors University in Salt Lake City. He is a frequent speaker, presenter and writer on IT's dual role enabling strategy and delivering operational excellence. Write to him at nnick@wgu.edu.

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