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The Importance of Proving Impact in Continuous Improvement

Posted by Stephanie Hill

Dec 7, 2022 3:44:22 PM

This blog was written by Stephanie Hill, Sr. Lean Strategist on the KaiNexus Lean Strategy Team. In this blog, Stephanie shares her experience learning the importance of proving impact as a Lean professional.

In Continuous Improvement, we are taught to look at mistakes as learning opportunities, not failures. Although sometimes this is easier said than done. In a previous role, the mistake I made impacted not only me but the other people on my team as well. What I learned through this experience is that no matter who is sitting in the executive office – demonstrating impact is crucial. In this blog post, I share my experience learning about the true value of tracking and communicating impact.

When I was recruited to run a new continuous improvement program and department at a previous employer, I was accustomed to achieving targets set by executives like, “Save 1.5x your salary.” “Reduce X% of the department’s budget.” For whatever reason, we were always in the mode of proving CI’s worth. Anyone who has studied the impact of Lean or CI will tell you that the benefits of the mindset and practice are far-reaching beyond immediate financials. An organization likely will experience greater employee morale, happier customers, and the ability to scale, among several other benefits. But at the end of the day, most organizations make decisions according to what their short-term bottom-line financial results tell them. So I became used to tracking the dollars. 

At this company, the CEO was already a Lean advocate. He was exclusively interested in the cultural impact and how we could increase workforce engagement. The CFO was my direct leader, and he told me that we did not need to capture decreased savings or increased revenue but merely engagement. I was excited by this focus and got to work spreading the mindset and practice of Lean. 

The first year I was with the company, we measured 75% engagement by the workforce in CI events, projects, or idea submissions. I celebrated this win with my new employees. We continued seeing positive growth in CI engagement, and there was tremendous excitement around improving the company’s practices. We did capture some of the savings, but it was optional for improvement efforts and significantly understated the actual financial value. 

Suddenly the CEO was gone. His replacement turned all attention to the dollars. I worked closely with him, the executive team, and the directors to align the company’s focus and identify areas to save money. Within two months, we teed up millions in savings. At the end of this exercise, my leader turned to me and said, “We are closing your department effective immediately.” We were not demonstrating sufficient ROI for the organization. 

And that was it. A flashing neon sign in my brain pointed to IMPACT. I had not been tracking, sharing, and celebrating the financial impact of the CI efforts over the years. They were there. I tracked the indicators of projects. I could easily do the math to point to the dollars. But I did not compile it. I did not let the leadership know that what we did mattered.

I have witnessed this same pattern in several previously revered CI-focused organizations. With a change in top leadership, flourishing Lean programs dissolved. I had seen this. I had seen friends lose their jobs in other companies in this same way. And yet, I had made this same mistake. There are so many benefits to a flourishing CI culture, and we can’t forget that financial impact is an important one.  

My recommendation to you is to continue tracking the cultural impact and workforce engagement of your organization - but don’t forget about the quantitative impact too! Sharing the wins of your CI program and aligning with your company’s objectives will help CI solidify its place as an invaluable department of your organization. 

Topics: Leadership, Spread Continuous Improvement

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