Nurture knowledge in your organization to achieve scale

Three critical management practices to build an organisation fit for scale.

Nurture knowledge in your organization to achieve scale
Photo of Greg Rosenke on Unsplash

Let’s imagine that a supermarket is running out of a popular product, such as a brand of children's cereal. They risk losing customers. Several solutions exist to avoid this problem, such as

  1. trying to convince customers to buy another brand, which is risky and unsustainable over time;
  2. having large stocks of the popular brand “just in case”, which is expensive in many ways;
  3. do nothing; or
  4. catch the problem before it happens or gets too serious.

For example, by displaying a visual signal as soon as the stock decreases, the stocker knows how to react early enough to place an order at the right time. In the event of an unexpected increase in customer demand, the stocker can report the problem as soon as it appears to their manager and together they can think about an immediate countermeasure to avoid a shortage of the popular brand. For example, they could negotiate with their suppliers for rush delivery or purchase several items at retail prices to cover the day's demand. Later in the day, they would take some time to understand the causes and conditions of the unexpected inventory drop and take steps to prevent the problem from happening again.

The system described is an example of kanban, a practice that is at the heart of lean. Without kanban, there can be no kaizen over the long run because kaizen is the result of problems encountered on a daily basis in the field.

In order to nurture knowledge in the organization, we need to get people excited about solving problems together. For this to work, the first condition is to draw their attention to the right problems. The Kanban system is above all a method of visualizing production and delivery problems: it helps people prioritize their activities and actions to produce the right product at the right time, and agree on the priorities. We all want to do a good job, to be proud of what we produce, and to be rewarded for it, not just financially. However, if we don't draw our attention to what's really important for clients, then we just decide individually and in the moment what to work on next, and this is not always the most important thing for the business. This situation creates dispersion which leads to conflicts and wasted energy.
Criterion no. 2 to nurture knowledge in the organization is to train team leaders and managers to solve problems using “kaizen”. Kaizen, which means continuous improvement at the heart of learning organizations, is not just a philosophy but a skill that can be learned by doing. We are formatted from an early age to act, much less to think: this phenomenon has become even more evident since the arrival of the Internet, which “thinks” for us. Doing kaizen means thinking like a scientist: I don't just react but I look for the best possible action before acting and then I try to see if I'm not mistaken. This is not a natural behavior and therefore needs to be developed. To do this, lean advocates create a chain of mentoring in the organization that nurtures kaizen. This means finding the team leaders and managers who will take this learning to heart. Paradoxically, it is first necessary to launch kaizen within the teams to find out who takes to it. Then train and empower those who demonstrate leadership, at all levels.

This brings us to the 3rd key criterion for nurturing knowledge in the organization: the CEO’s gemba walks. By going into the field every week, if not every day, CEOs have the opportunity to train employees in problem solving. Make no mistake: the CEO does not go out into the field to check that people are doing their job well but to demonstrate kaizen thinking. Which is to say that they themselves must learn to do kaizen if they want to be able to train others. Their main objective should be, at each “gemba walk”, to be pleasantly surprised by the solutions put in place by people and by their reasoning to improve their job and the customer experience. Teams with a trained and motivated team leader get there very quickly. For others, it's harder. Departments headed by trained and motivated managers also learn kaizen very quickly, and this shows in the results and the commitment of people. Just like kaizen, conducting gemba walks is a skill that can be learned, through practice with a sensei who teaches us to put our finger on the right problem and ask the right questions.

A company in which employees know how to resolve the right problems together, where managers focus on people development, and CEOs lead from the ground up, stands a better chance of achieving scale. It is capable of overcoming any obstacle and focuses all its energy on creating value for customers.